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HomeMy WebLinkAboutRes 06-56 and FA-53 Project Area No. 1 Issuance & Sale of Tax Allocation Revenue BondsCITY OF PALM DESERT/PALM DESERT FINANCING AUTHORITY STAFF REPORT REQUEST: APPROVAL OF RESOLUTION NO. 06 56 OF THE CITY COUNCIL OF THE CITY OF PALM DESERT MAKING FINDINGS OF SIGNIFICANT PUBLIC BENEFIT IN CONNECTION WITH THE ISSUANCE AND SALE OF TAX ALLOCATION REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES A (TAX-EXEMPT), AND TAX ALLOCATION REFUNDING REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES B (TAXABLE) OF THE PALM DESERT FINANCING AUTHORITY APPROVAL OF RESOLUTION NO. FA-53 OF THE PALM DESERT FINANCING AUTHORITY ACKNOWLEDGING FINDINGS OF SIGNIFICANT PUBLIC BENEFIT IN CONNECTION WITH THE ISSUANCE AND SALE OF THE AUTHORITY'S TAX ALLOCATION REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES A (TAX-EXEMPT), AND TAX ALLOCATION REFUNDING REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES B (TAXABLE) OF THE PALM DESERT FINANCING AUTHORITY AND APPROVING THE ISSUANCE, SALE AND DELIVERY OF SUCH BONDS SUBMITTED BY: DAVE YRIGOYEN, DIRECTOR OF REDEVELOPMENT/HOUSING DATE: APRIL 27, 2006 CONTENTS: CITY COUNCIL RESOLUTION NO. 06- PALM DESERT FINANCING AUTHORITY RESOLUTION NO. FA - Recommendation: By Minute Motion: 1. That the City Council and Financing Authority Commission open a public hearing, receive Public Testimony, and after hearing such testimony: 2. That the City Council approve Resolution No. 06-56 , making findings of significant public benefit in connection with the issuance and sale of Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), 2006 Series A (Tax -Exempt), and Tax Allocation Refunding Revenue Bonds (Project Area No. 1, As Amended), 2006 Series B (Taxable) of the Palm Desert Financing Authority. 3. That the Palm Desert Financing Authority approve Resolution No. FA-s3 acknowledging finding of significant public benefit in connection with the issuance and sale of the Authority's Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), 2006 Series A (Tax -Exempt) and Tax Allocation Refunding Revenue Bonds (Project Area No. 1, As Amended), 2006 Series B (Taxable) and approving the issuance, sale and delivery of such bonds. G:1RDA'Arla Scott\Word Files\Staff Repts\PA1-CCPD-PDFA-Findings of Benefit.doc Staff Report Approval of Resolutions — Issuance/Sale of Tax Allocation Revenue Bonds — PA#1 Page 2 of 2 April 27, 2006 Executive Summary The attached resolutions of the City Council and the Financing Authority are preliminary steps that will further the process to issue tax-exempt and taxable refunding bonds of the Financing Authority payable from tax increment revenues from Project Area No. 1, As Amended. Discussion: State law requires that a member local agency of the Financing Authority within whose boundaries the financed improvements are to be located, hold a public hearing and make a finding of significant public benefit with respect to the improvements. State law also requires the City Council to hold a public hearing in connection with certain improvements financed with tax increment revenues of the Redevelopment Agency. There will be approximately $47 million of tax-exempt new money bonds and $25 million of taxable refunding bonds issued. The Refunding bonds will be used to convert the Series 1997 from tax- exempt to taxable bonds to remove the bond restrictions placed on Desert Willow. After the various costs of issuance there will be approximately $46 million in bond proceeds. These funds will be used for street widening throughout the project area, drainage improvements throughout the project area, the construction of the Portola & 1-10 Interchange, construction of a swimming pool and related shower and restroom facilities at the College of the Desert and other various projects. Staff is recommending that the City Council hold the public hearing, adopt its resolution making the findings, and that the Financing Authority subsequently adopt its resolution acknowledging those findings. Submitted by: ave Yri Director df, development/Housing Approval: JustinyiaCarthy, ACM Redevelopment Carlos`L. e rtega fty Manager/CAO Paul S. Gibson, Director of Finance RESOLUTION NO. 06-56 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT MAKING A FINDING OF SIGNIFICANT PUBLIC BENEFIT AND OTHER FINDINGS IN CONNECTION WITH THE ISSUANCE AND SALE BY THE PALM DESERT FINANCING AUTHORITY OF ITS TAX ALLOCATION REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES A, AND TAX ALLOCATION REFUNDING REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES B (TAXABLE) RECITALS: WHEREAS, the Palm Desert Financing Authority (the "Authority") has proposed to sell and issue its Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), 2006 Series A (the "Series 2006A Bonds") and Tax Allocation Refunding Revenue Bonds (Project Area No. 1, As Amended), 2006 Series B (Taxable) (the "Series 2006B Bonds," and together with the Series 2006A Bonds, the "Bonds"); and WHEREAS, proceeds of the Series 2006A Bonds are to be applied for the purpose of making a loan to the Palm Desert Redevelopment Agency (the "Agency") for the object and purpose of, among other things, assisting in the financing of certain public capital improvements of benefit to Project Area No. 1, As Amended, of the Agency (the "Project Area") including (i) the construction of on and off ramps at Portola Avenue and Interstate 10; (ii) the widening of various portions of Monterey Avenue, Portola Avenue, Country Club Drive, and various other street improvements throughout the Project Area; (iii) improvements to the frontage roads along Highway 111; (iv) a sound attenuation wall along portions of Fred Waring Drive; (v) landscape, lighting and median improvements along El Paseo; (vi) landscape improvements throughout the Project Area, (vii) a Portola Avenue Bridge over the Whitewater Channel; (viii) drainage improvements along a portion Monterey Avenue; (ix) the development of a visitors center at El Paseo and Highway 111; (x) neighborhood and arterial street utility undergroundings throughout the Project Area; (xi) a parking structure to accommodate a hotel and related development at the Desert Willow Golf Resort; (xii) a business facade enhancement grant program; and (xiii) the construction of a swimming pool and related shower and restroom facilities at the College of the Desert; and WHEREAS, proceeds of the Series 2006B Bonds are to be applied for the purpose of making a loan to the Agency for the object and purpose of, among other things, effecting the refunding of the portion of the Authority's Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), Series 1997, scheduled to mature on April 1, 2023; and P6402.1054\884008.2 Resolution No. 06- 56 WHEREAS, pursuant to Section 6586.5 of the California Government Code and after notice duly published in accordance with law, this City Council held a public hearing on this date with respect to the issuance of the proposed Bonds and received evidence concerning the public benefits therefrom; and NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. Recitals. The above recitals, and each of them, are true and correct. Section 2. Approval of Financing. The City Council hereby finds that the financing and refinancing of public capital improvements described above through the issuance by the Authority of the Bonds will result in significant public benefits to the constituents of the Agency and the City of Palm Desert, including demonstrable savings in effective interest rate and more efficient delivery of Agency and City services to residential and commercial development. The City Council hereby approves the issuance of the Bonds by the Authority. Section 3. Further Findings. The City Council hereby finds and determines that based upon the "Summary Report Regarding Payment by the Palm Desert Redevelopment Agency for All or a Portion of the Cost of the Installation and Construction of Certain Public Capital Improvements of Benefit to Project Area No. 1, As Amended," which Report was made available at the office of the City Clerk in connection with the public hearing described in the Recitals hereof, and other information presented to the City Council: (i) the above -described public capital improvements are of benefit to the Project Area and to the immediate neighborhood in which the project is located; (ii) the payment of funds for the cost of such public capital improvements will assist in the elimination of one or more blighting conditions inside the Project Area; (iii) the payment of funds for the cost of such improvements is consistent with the Agency's implementation plan adopted pursuant to Health and Safety Code Section 33490; and (iv) no other reasonable means of financing such improvements is available to the City. Section 4. Approval of Payment by Aaencv. The City Council hereby approves payment by the Agency for the cost of the installation and construction of the above -described improvements from tax increment revenues of the Agency from the Project Area. Section 5 Other Acts. The officers of the City are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents which they may deem necessary or advisable in order to effectuate the purposes of this Resolution and any such actions previously taken by such officers are hereby ratified and confirmed. P6402.1054\884008.2 Resolution No. 06-56 Section 6. Effective Date. This Resolution shall take effect immediately upon adoption. APPROVED and ADOPTED this 27th day of April 2006 by the following vote to wit: AYES: NOES: ABSENT: ABSTAIN: Jim Ferguson, Mayor ATTEST: Rachelle D. Klassen, City Clerk P6402.1054\884008.2 RESOLUTION NO. FA- 53 A RESOLUTION OF THE PALM DESERT FINANCING AUTHORITY ACKNOWLEDGING A FINDING OF SIGNIFICANT BENEFIT AND APPROVING AS TO FORM AND AUTHORIZING THE EXECUTION AND DELIVERY OF CERTAIN DOCUMENTS IN CONNECTION WITH THE ISSUANCE, SALE AND DELIVERY OF THE AUTHORITY'S TAX ALLOCATION REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES A, AND TAX ALLOCATION REFUNDING REVENUE BONDS (PROJECT AREA NO. 1, AS AMENDED), 2006 SERIES B (TAXABLE) AND AUTHORIZING CERTAIN OTHER MATTERS RELATING THERETO RECITALS: WHEREAS, the Palm Desert Financing Authority (the "Authority") is a joint powers authority duly organized and existing under and pursuant to Articles 1 through 4 (commencing with Section 6500), Chapter 5, Division 7, Title 1 of the California Government Code (the "Act") and that certain Joint Exercise of Powers Agreement dated as of January 26, 1989, by and between the City of Palm Desert (the "City") and the Palm Desert Redevelopment Agency (the "Agency"), and is authorized pursuant to Article 4 of the Act to issue bonds for the purpose of making loans to the Agency to provide financing and refinancing for public capital improvements; and WHEREAS, the Authority desires to issue and sell its Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), 2006 Series A (the "Series 2006A Bonds") and Tax Allocation Refunding Revenue Bonds (Project Area No. 1, As Amended), 2006 Series B (Taxable) (the "Series 2006B Bonds," and together with the Series 2006A Bonds, the "Bonds") to be issued and secured pursuant to a certain Indenture (as defined below); and WHEREAS, proceeds of the Series 2006A Bonds are to be applied for the purpose of making a loan to the Agency pursuant to a certain Loan Agreement (as defined below) for the object and purpose of, among other things, assisting in the financing of certain public capital improvements of benefit to Project Area No. 1, As Amended, of the Agency; and WHEREAS, proceeds of the Series 2006B Bonds are to be applied for the purpose of making a second loan to the Agency pursuant to the Loan Agreement for the object and purpose of, among other things, effecting the refunding of the portion of the Authority's Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), Series 1997, scheduled to mature on April 1, 2023; and P6402.1054\884009.3 Resolution No. FA- 53 WHEREAS, the City Council has made a finding, after a duly noticed public hearing pursuant to Section 6586.5 of the California Government Code, that the issuance of the Bonds will result in significant public benefit; NOW, THEREFORE, THE PALM DESERT FINANCING AUTHORITY DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1.Recitals. The above recitals, and each of them, are true and correct. Section 2.Acknowledament of City Council Findings. The Authority hereby acknowledges and concurs with the City Council's finding of significant public benefit and hereby approves and authorizes the issuance and sale of the Bonds. Section 3.Issuance of Bonds: Indenture. The Indenture of Trust (the "Indenture"), proposed to be entered into by and between the Authority and the Trustee (defined in Section 3 below), in the form presented at this meeting and on file in the office of the Secretary of the Authority (the "Secretary"), is hereby approved. The issuance of the Series 2006A Bonds, in an aggregate principal amount not exceeding $55,000,000, and the issuance of the Series 2006B Bonds, in an aggregate principal amount not exceeding $30,000,000, pursuant to the Indenture are hereby approved. Subject to Section 10 below, each of the President, the Chief Administrative Officer and the Treasurer of the Authority, any deputy of such officers, and any member of the Authority Commission (each, an "Authorized Officer"), acting singly, is hereby authorized and directed, for and in the name and on behalf of the Authority, to execute and deliver the Indenture in substantially said form, with such additions or changes as the Authorized Officer executing the same may approve (such approval to be conclusively evidenced by such Officer's execution and delivery thereof). Section 4.ADDointment of Trustee and Escrow Agent. The appointment of Wells Fargo Bank, N.A., as trustee (the "Trustee") under the Indenture and as escrow agent (the "Escrow Agent") under the Escrow Agreement described in Section 6 hereof is hereby approved. Section 5.Loan Aareement. The Project Area No. 1, As Amended Loan Agreement (the "Loan Agreement"), proposed to be entered into by and among the Agency, the Authority and the Trustee, in the form presented at this meeting and on file in the office of the Secretary, is hereby approved. Each of the Authorized Officers, acting singly, is hereby authorized and directed, for and in the name and on behalf of the Authority, to execute and deliver the Loan Agreement in substantially said form, with such changes therein as the Authorized Officer executing the same may approve (such approval to be conclusively evidenced by such Officer's execution and delivery thereof). Section 6.Escrow Agreement. The Escrow Agreement (Project Area No. 1, As Amended), proposed to be entered into by and among the Agency, the Authority P6402.1054\884009.3 2 Resolution No. FA- 53 and the Escrow Agent, in the form presented to this meeting and on file in the office of the Secretary, is hereby approved. Each of the Authorized Officers, acting singly, is hereby authorized and directed, for and in the name and on behalf of the Authority, to execute and deliver the Escrow Agreement in substantially said form, with such changes therein as the Authorized Officer executing the same may approve (such approval to be conclusively evidenced by such officer's execution and delivery thereof. Section 7. Preliminary Official Statement. The Preliminary Official Statement relating to the Bonds (the "Preliminary Official Statement"), in the form presented at this meeting and on file with the Secretary, is hereby approved. Each of the Authorized Officers, acting singly, is hereby authorized and directed, for and in the name and on behalf of the Authority, to cause the Preliminary Official Statement in substantially said form, with such changes therein as such Authorized Officer may approve, to be deemed final for the purposes of Rule 15c2-12 of the Securities and Exchange Act of 1934. The distribution by Stone & Youngberg LLC. (the "Underwriter") of copies of the Preliminary Official Statement to potential purchasers of the Bonds is hereby approved. Section 8.Official Statement. Each of the Authorized Officers, acting singly, is hereby authorized and directed, for and in the name and on behalf of the Authority, to cause the Preliminary Official Statement to be brought into the form of a final Official Statement (the "Official Statement"), and to execute the same for and in the name and on behalf of the Authority, with such changes therein as such Authorized Officer may approve (such approval to be conclusively evidenced by such Authorized Officer's execution and delivery thereof). The distribution and use of the Official Statement by the Underwriter in connection with the sale of the Bonds are hereby approved. Section 9.Purchase Agreement. The form of the Bond Purchase Agreement as presented to this meeting by the Underwriter and the sale of the Bonds pursuant thereto upon the terms and conditions set forth therein are hereby approved. Subject to Section 10 below, each of the Authorized Officers, acting singly, is authorized and directed, for and in the name and on behalf of the Authority, to execute and deliver the Purchase Agreement in substantially said form, with such changes therein as the officer executing the same may require or approve, including such matters as are authorized by Section 10 hereof (such approval to be conclusively evidenced by such Authorized Officer's execution and delivery thereof). Section 10. Terms of Sale of Bonds. Each of the Authorized Officers, acting singly, is hereby authorized and directed to act on behalf of the Authority to establish and determine (a) the aggregate principal amount of the Series 2006A Bonds, which amount shall not exceed $55,000,000, (b) the aggregate principal amount of the Series 2006B Bonds, which amount shall not exceed $30,000,000; (c) interest rates on the Bonds, provided that the true interest cost with respect to the Series 2006A Bonds shall not exceed 6.00 percent and the true interest cost with respect to the Series P6402.1054\884009.3 3 Resolution No. FA-5 2006B Bonds shall not exceed 7.00 percent, (d) the Underwriter's compensation (i.e., underwriter's discount) with respect to the sale of the Bonds, provided that such compensation with respect to the Series 2006A Bonds shall not exceed 1.00 percent of the aggregate principal amount of the Series 2006A Bonds, and such compensation with respect to the Series 2006B Bonds shall not exceed 1.25 percent of the aggregate principal amount of the Series 2006B Bonds, and (e) such provisions as may be required by the terms of the bond insurance, if any, or debt service reserve surety bond(s), if any, purchased in connection with the issuance of the Bonds. The authorization and powers delegated to such officer by this Section 10 shall be valid for a period of 120 days from the date of adoption of this Resolution. Section 11. Requisitions. Each of the Authorized Officers, acting singly, is hereby authorized and directed to execute one or more requisitions authorizing the Trustee to pay the costs of issuing the Bonds from the proceeds of the Bonds pursuant to the Indenture. Section 12. Other Acts. The Authorized Officers and all other officers of the Authority are hereby authorized and directed, jointly and severally, to do any and all things, to execute and deliver any and all documents which they may deem necessary or advisable in order to consummate the issuance, sale and delivery of the Bonds, or otherwise to effectuate the purposes of this Resolution, the Indenture, the Loan Agreement, the Escrow Agreement, the Purchase Agreement and the Official Statement, and any such actions previously taken by such officers are hereby ratified and confirmed. Section 13. Effective Date. This Resolution shall take effect immediately upon adoption. APPROVED AND ADOPTED this 27th day of April 2006 by the following vote to wit: AYES: NOES: ABSENT: ABSTAIN: ATTEST: Rachelle D. Klassen, Secretary P6402.1054\884009.3 Jim Ferguson, President 4