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HomeMy WebLinkAboutBonds - PA1, 2, 3, & 4/Res 06-74/Res FA-55/Res 527CITY OF PALM DESERT PALM DESERT FINANCING AUTHORITY PALM DESERT REDEVELOPMENT AGENCY STAFF REPORT REQUEST: HOLD A PUBLIC HEARING IN CONNECTION WITH THE ISSUANCE OF BONDS BY THE PALM DESERT FINANCING AUTHORITY SUBMITTED BY: DAVE YRIGOYEN, DIRECTOR OF REDEVELOPMENT/HOUSING DATE: JUNE 8, 2006 CONTENTS: AMENDED SUMMARY REPORTS FOR PROJECT AREAS NOS. 1 AND 2, AND SUMMARY REPORTS FOR PROJECT AREAS NOS. 3 AND 4 (NO FURTHER ACTION REQUIRED) Recommendation: By Minute Motion: 1. That the City Council open a public hearing, receive public testimony and comments, and then close the public hearing; and 2. That, after the close of the public hearing, proceed to consider the various resolutions relating to the issuance of bonds by the Palm Desert Financing Authority covered by the next agenda items. Executive Summary: State law requires the City Council to hold a public hearing in connection with the issuance of bonds and the financing of certain Agency projects. The City Council is requested to hold the public hearing, receive public testimony, and close the hearing. No further action is required on this item. Background and Discussion: California Government Code Section 6586.5 requires the City Council to hold a public hearing in connection with the issuance of bonds by the Palm Desert Financing Authority to finance certain public improvements. California Health and Safety Code Section 33679 also requires the City Council to hold a public hearing before the Agency commits to pay tax increment revenues for certain projects. This public hearing, which has been duly noticed under both statutes, covers both public hearing requirements. Pursuant to Section 33679, an amended summary report for Project Area No. 1, As Amended, an amended summary report for Project Area No. 2, a summary report for Project Area No. 3 and a summary report for Project Area No. 4 have all been made available to the public. Each of the summary reports describes the various projects, which may be paid for, in whole or in part, from the proposed Agency bond issues. All of the summary reports have been attached to this staff report for your convenience — no action on any of the summary reports is required at this time. The City Council is being asked only to P6401-0001\893887v 1.doc Staff Report Public Hearing — Issuance of Bonds by the Palm Desert Financing Authority Page 2 of 2 June 8, 2006 open the public hearing, receive public testimony, close the public hearing and then move on to consider the next agenda items which cover the proposed bond issues of the Palm Desert Financing Authority to finance projects for Project Area No. 1, As Amended, Project Area No. 2, Project Area No. 3 and Project Area No. 4. Staff is recommending that the City Council hold the public hearing and then proceed to consider the next agenda items. Submitted by: D Yrigoyen Director of R eve ment/Housing Approval: elopment b �� City Manager/7�0/Executive Director Carlos L. rte Paul S. i Lichr i ctor of Finance/Treasurer CITY COUNCIL ACTION: APPROVED DENILA. RECEIVED._ OTHER 0 & .'et0).,ec/ b/i_c ( i /- (_ (Y aatc. /. MET N PaA /(o AYES:_ NOES: ASSENT: A ABSTAIN: VERIFIED EY: _) Original on ile s�n(1;:ly Clerk's Office �Q,ncd, � (eked 1/G e/2 - C'l fic4/rt- IL" ---et BY FIN AUTH ON VERIFIED BY: /,,Original on file with Cityterk's Office L f , ice% AMC. C ec nmP.F:Lf `� Cio 4b/rc I re BY RDA VERIFIED BY -' OdgInai on file with City Clerk's Office P6401-0001\893887v1.doc 2 AMENDED 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 DATED: MAY 25, 2006 Estimate of Taxes The Palm Desert Financing Authority (the "Authority") proposes to issue bonds to finance payment for all or a portion of the cost of the installation and construction of certain public capital improvements, including the following: Acquisition / Improvement Core commercial areas projects (including public infrastructure, parking improvements and other improvements at and around Westfield shopping center, Highway 111 and El Paseo) Improvements to frontage roads along Highway 111 — Alessandro Alleyway (including street landscaping, parking improvements and other improvements) Estimated cost to be paid in whole or in part from bond proceeds $15,000,000 $5,000,000 Renovation and improvement of $1,200,000 parking facilities at President's Plaza El Paseo (west of Highway 74) extension and upgrade (including median work, landscaping, lighting and other related improvements) $5,000,000 Development of a multi -use community $6,100,000 center at El Paseo and Highway 111 Construction of Portola Avenue Bridge $6,000,000 across the Whitewater Channel Widening of Monterey Avenue from $1,000,000 P6402.1054\892501.3 1 Magnesia Falls Drive to Gerald Ford Drive Widening of Portola Avenue between Fred Waring Drive and Magnesia Falls Drive $3,000,000 Undergrounding of neighborhood $10,000,000 utilities throughout the Project Area The amounts set forth above are based upon the current estimates of costs and availability of other funds that Agency believes are reasonable. Such amounts may vary depending on the actual costs and availability of funds. Pursuant to a proposed loan agreement between the Authority and the Palm Desert Redevelopment Agency (the "Agency"), the Agency would pay debt service on the Authority bonds from taxes ("tax increment revenues") allocated to the Agency pursuant to California Health and Safety Code Section 33670(b) from its Project Area No. 1, As Amended (the "Project Area"). The total estimated amount of tax increment revenues allocated to the Agency from the Project Area necessary to pay debt service on the Authority bonds issued to finance all or a portion of the above -described projects (assuming an aggregate principal amount of bonds of approximately $42,000,000 and an overall interest rate of 5.15 percent, a term of the bonds of 24 years), would be approximately $72,000,000. To the extent that such bonds issued by the Authority are not sufficient to pay for all of the costs of the above -described public capital improvements, the Agency will pay for the balance of such costs from other available funds of the Agency. Facts Supporting Determinations The Project Area is an area in which there exists a combination of conditions of blight so prevalent and so substantial that it causes a reduction of, or lack of, proper utilization of the area to such an extent that it constitutes a serious physical, social and economic burden on the community which cannot reasonably be expected to be reversed or alleviated by private enterprise or governmental action, or both, without redevelopment. Among other things, the Project Area is characterized by buildings and structures, used or intended to be used for living, commercial, industrial, or other purposes, which are unfit or unsafe to occupy for such purposes and are conducive to juvenile delinquency and crime because of, among other things, inadequate provision for recreational facilities. In addition, the Project Area contains vacant and underutilized properties and properties which suffer from economic dislocation, deterioration or disuse, including depreciated or stagnant property values and impaired investments, and deteriorated, aged and obsolete buildings. The Project Area is characterized by the existence of inadequate public improvements, public facilities and open space that cannot be remedied by private or governmental action without redevelopment. The lack of adequate public improvements P6402.1054' 892501.3 2 hinders economic development opportunities and contributes to the existence of depreciated and stagnant property values and impaired investments in the Project Area. Highway 111 and El Paseo generally run east -west through the core commercial area of the City. The frontage roads provide access to the various commercial uses along Highway 111. President's Plaza is located on El Paseo east of Highway 74 and west of Portola Avenue. Inadequate public infrastructure and improvements, particularly in and around the commercial center of the City, contribute to the blighted condition of the Project Area. The installation of various public infrastructures and improvements in and around the core commercial area, including street landscaping, parking improvements and other improvements will promote the economic viability of the Project Area, improve traffic circulation, attract new businesses, encourage business expansion encourage private sector investment and enhance the public health, safety and welfare in the Project Area. The extension and upgrades of El Paseo west of Highway 74, which is adjacent to the core commercial area, will further enhance the development of the Project Area. The proposed multi -use community center at El Paseo and Highway 111 will serve residents and visitors to the Project Area and the City and will provide a new, modern and efficient facility to serve the residents and taxpayers of the City. The construction of such a multi -use community center will further encourage private sector investment in the Project Area and create job opportunities for the residents and taxpayers of the Project Area and the City. Portola Avenue and Monterey Avenue are major north —south arterials. The proposed widening, bridge, and other improvements to these major arterials and other streets throughout the Project Area will improve traffic circulation within the Project Area and thereby mitigate congestion and safety hazards. The undergrounding of utilities throughout the Project Area will eliminate unsightly and potentially hazardous overhead electrical, telephone and cable television lines, thereby improving the public health, safety and welfare. The budget constraints of the City and the extraordinary voter approval requirements applicable to traditional methods of financing (such as general obligation bonds and community facilities district special tax bonds) as a practical matter prevent the City from financing the acquisition of such open space and the acquisition of the land for and the installation and construction of the above - described improvements by any other means. No moneys of the City were, are or are reasonably expected to be available on a Tong -term basis under the budget of the City to pay for the cost of the installation and construction of the above -described public improvements. Traditional methods of financing such as the issuance of general obligation bonds are unavailable as a practical matter because of the extraordinary majority voter approval requirements of two-thirds of the electorate. Assessment financing or special tax financing could P6402.1054\892501.3 3 overburden benefiting properties with assessments or special taxes and, in addition, special taxes require a two-thirds vote and assessments are subject to a majority protest. The installation and construction of the above -described improvements are all consistent with the Agency's implementation plan. Redevelopment Purpose; Elimination of Blight The construction and installation of the above -described public improvements will serve a basic purpose of redevelopment; redevelopment includes the provision of structures as may be appropriate or necessary in the interest of the general welfare, including recreational and other facilities, as well as the provision of public recreational areas and the provision for open -space types of use, such as streets. In addition, a fundamental purpose of redevelopment is to expand employment opportunities and to provide an environment for the social, economic and psychological growth and well-being of all citizens. The construction and installation of the above -described public improvements will assist in the elimination of blight in the Project Area which is caused by the lack of adequate public improvements, assist in the revitalization of the Project Area, help to reverse depreciated or stagnant property values and impaired investments, encourage private sector investment, create job opportunities, promote the economic viability of businesses in the Project Area, attract new businesses, assist in retaining existing businesses, and encourage business expansion, all for the health, safety and welfare of the residents and taxpayers of the Project Area and the City. P6402.1054\892501.3 4 AMENDED SUMMARY REPORT REGARDING PAYMENT BY THE PALM DESERT REDEVELOPMENT AGENCY FOR ALL OR A PORTION OF THE COST OF THE ACQUISITION OF LAND FOR OPEN SPACE AND THE INSTALLATION AND CONSTRUCTION OF CERTAIN OTHER PUBLIC CAPITAL IMPROVEMENTS OF BENEFIT TO PROJECT AREA NO. 2 DATED: MAY 25, 2006 Estimate of Taxes The Palm Desert Financing Authority (the "Authority") proposes to issue bonds to finance payment for all or a portion of the cost of land for open space and the installation and construction of certain other public capital improvements, including the following: Acquisition / Improvement Estimated cost to be paid in whole or in part from bond proceeds Acquisition of open space for $13,500,000 recreational purposes Installation of Freedom Park at Country $3,000,000 Club Drive and Liberty Avenue Construction of a swimming pool and $3,500,000 related shower and restroom facilities at the College of the Desert Civic center park improvements, including the construction and improvements of public recreational buildings Construction of a parking structure to accommodate a hotel and related development at the Desert Willow Golf Resort $3,000,000 $7,000,000 Construction of a fire station and $4,000,000 related improvements P6402.1055\892560.2 1 Acquisition / Improvement Construction of a pedestrian bridge at University Park Installation of a new section of Berger Drive and related improvements Widening of Monterey Avenue between Magnesia Falls Drive and Gerald Ford Drive Improvements to the on- and off -ramps at Monterey Avenue and Interstate 10 Construction of on- and off -ramps at Portola Avenue and Interstate 10 Drainage improvements along Monterey Avenue Undergrounding of utilities on arterial streets throughout the Project Area Estimated cost to be paid in whole or in part from bond proceeds $1, 500,000 $500,000 $2,000,000 $4,000 ,000 $16,800,000 $2,000,000 $10,000,000 The amounts set forth above are based upon the current estimates of costs and availability of other funds that Agency believes are reasonable. Such amounts may vary depending on the actual costs and availability of funds. Pursuant to proposed loan agreements between the Authority and the Palm Desert Redevelopment Agency (the "Agency"), the Agency would pay debt service on the Authority bonds from taxes ("tax increment revenues") allocated to the Agency pursuant to California Health and Safety Code Section 33670(b) from its Project Area No. 2 (the "Project Area"). The total estimated amount of tax increment revenues allocated to the Agency from the Project Area necessary to pay debt service on the Authority bonds issued to finance all or a portion of the above -described projects (assuming an aggregate initial principal amount of bonds of approximately $65,000,000 and an overall interest rate of 5.22 percent, a term of the bonds of 30 years), would be approximately $139,000,000. To the extent that such bonds issued by the Authority are not sufficient to pay for all of the costs of the above -described land and public capital improvements, the Agency will pay for the balance of such costs from other available funds of the Agency. P6402.1055 \892560.2 2 Facts Supporting Determinations The Project Area is an area in which there exists a combination of conditions of blight so prevalent and so substantial that it causes a reduction of, or lack of, proper utilization of the area to such an extent that it constitutes a serious physical, social and economic burden on the community which cannot reasonably be expected to be reversed or alleviated by private enterprise or governmental action, or both, without redevelopment. Among other things, the Project Area is characterized by buildings and structures, used or intended to be used for living, commercial, industrial, or other purposes, which are unfit or unsafe to occupy for such purposes and are conducive to juvenile delinquency and crime because of, among other things, inadequate provision for recreational facilities. In addition, the Project Area contains vacant and underutilized properties and properties which suffer from economic dislocation, deterioration or disuse, including depreciated or stagnant property values and impaired investments, and deteriorated, aged and obsolete buildings. The Project Area is characterized by the existence of inadequate public improvements, public facilities and open space that cannot be remedied by private or governmental action without redevelopment. The lack of adequate public improvements hinders economic development opportunities and contributes to the existence of depreciated and stagnant property values and impaired investments in the Project Area. Improvement and development of public parks and recreational facilities assist in elimination of blighted conditions in the Project Area. The acquisition of land for open space will provide needed recreational opportunities for hiking and other activities to serve the residents and taxpayers of Project Area and the City. The installation of Freedom Park, the construction of a swimming pool and related facilities at the College of the Desert, and the construction and improvement of public recreational facilities relating to the civic center park project will enhance and provide additional needed park facilities to serve the residents and taxpayers of the Project Area and the City. These projects promote physical and mental health, and help correct the situation of inadequate facilities for recreational use and inadequate recreational improvements in the Project Area and the City, promote the sound development and redevelopment of the Project Area and reduce crime and juvenile delinquency, all for the benefit of the residents and taxpayers of the Project Area and the City. The parking structure will serve the Desert Willow Golf Resort and future hotel and other developments which would otherwise lack adequate public parking. The parking structure improvements are required in order to eliminate a factor which would substantially hinder the economically viable use of the Desert Willow Golf Resort. The construction of a new fire station will address a need with respect to public safety, health and welfare and benefit the residents and businesses of the Project Area and the City. P6402.1055\ 892560.2 3 The construction of a pedestrian bridge at University Park will mitigate congestion and safety hazards. The installation of Berger Drive will improve traffic circulation within the Project Area. These projects will enhance the economic viability of the Project Area, encourage private sector investment and enhance residential and commercial development in the Project Area. Gerald Ford is a major east -west arterial and Portola Avenue and Monterey Avenue are major north -south arterials. The proposed widening and on and off ramp improvements will improve traffic circulation within the Project Area and thereby mitigate congestion and safety hazards. The drainage improvements along Monterey Avenue will also improve traffic circulation and protect property in the Project Area and enhance the public health, safety and welfare. The undergrounding of utilities on arterial streets throughout the Project Area will eliminate unsightly and potentially hazardous overhead electrical, telephone and cable television lines, thereby improving the public health, safety and welfare. These in turn will assist in eliminating a factor which prevents or substantially hinders the economically viable use or capacity of buildings or lots and will encourage private -sector investment in the Project Area, thereby facilitating the redevelopment of the Project Area. The proposed open space and public improvements described above will assist in the elimination of blight in the Project Area which is caused by inadequate public improvements and open space. The acquisition of the land and the installation and construction of the public improvements will promote the economic viability of the Project Area businesses, attract new businesses, encourage business expansion and encourage private sector investment in the Project Area. The budget constraints of the City and the extraordinary voter approval requirements applicable to traditional methods of financing (such as general obligation bonds and community facilities district special tax bonds) as a practical matter prevent the City from financing the acquisition of such open space and the acquisition of the land for and the installation and construction of the above - described improvements by any other means. No moneys of the City were, are or are reasonably expected to be available on a long-term basis under the budget of the City to pay for the value of the land for open space or the value of the land for and the cost of the installation and construction of the above - described public improvements. Traditional methods of financing such as the issuance of general obligation bonds are unavailable as a practical matter because of the extraordinary majority voter approval requirements of two-thirds of the electorate. Assessment financing or special tax financing could overburden benefiting properties with assessments or special taxes and, in addition, special taxes require a two-thirds vote and assessments are subject to a majority protest. P6402.1055,892560.2 4 The acquisition of all of the above -described land and the installation and construction of the above -described improvements are all consistent with the Agency's implementation plan. Redevelopment Purpose; Elimination of Blight The acquisition of the above -described land and the construction of the above -described public improvements will serve a basic purpose of redevelopment; redevelopment includes the provision of structures as may be appropriate or necessary in the interest of the general welfare, including recreational and other facilities, as well as the provision of public recreational areas and the provision for open -space types of use, such as streets. In addition, a fundamental purpose of redevelopment is to expand employment opportunities and to provide an environment for the social, economic and psychological growth and well-being of all citizens. The acquisition of the above -described land and the construction of the above -described public improvements will assist in the elimination of blight in the Project Area which is caused by the lack of adequate public improvements, assist in the revitalization of the Project Area, help to reverse depreciated or stagnant property values and impaired investments, encourage private sector investment, create job opportunities, promote the economic viability of businesses in the Project Area, attract new businesses, assist in retaining existing businesses, and encourage business expansion, all for the health, safety and welfare of the residents and taxpayers of the Project Area and the City. P6402.1055\892560.2 5 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. 3 DATED: MAY 25, 2006 Estimate of Taxes The Palm Desert Financing Authority (the "Authority") proposes to issue bonds to finance payment for all or a portion of the cost of land for open space and the installation and construction of certain other public capital improvements, including the following: Acauisition / Improvement Civic center park improvements, including the construction and improvements of public recreational buildings Construction of a parking structure to accommodate a hotel and related development at the Desert Willow Golf Resort Estimated cost to be paid in whole or in part from bond proceeds $1,000,000 $3,000,000 Construction of on- and off -ramps at $8,200,000 Portola Avenue and Interstate 10 Undergrounding of utilities throughout $2,000,000 the Project Area The amounts set forth above are based upon the current estimates of costs and availability of other funds that Agency believes are reasonable. Such amounts may vary depending on the actual costs and availability of funds. Pursuant to proposed loan agreements between the Authority and the Palm Desert Redevelopment Agency (the "Agency"), the Agency would pay debt service on the Authority bonds from taxes ("tax increment revenues") allocated to the Agency pursuant to California Health and Safety Code Section 33670(b) from P6402.1056\892565.2 1 its Project Area No. 2 (the "Project Area"). The total estimated amount of tax increment revenues allocated to the Agency from the Project Area necessary to pay debt service on the Authority bonds issued to finance all or a portion of the above -described projects (assuming an aggregate initial principal amount of bonds of approximately $15,500,000 and an overall interest rate of 5.47 percent, a term of the bonds of 35 years), would be approximately $35,600,000. To the extent that such bonds issued by the Authority are not sufficient to pay for all of the costs of the above -described land and public capital improvements, the Agency will pay for the balance of such costs from other available funds of the Agency. Facts Supporting Determinations The Project Area is an area in which there exists a combination of conditions of blight so prevalent and so substantial that it causes a reduction of, or lack of, proper utilization of the area to such an extent that it constitutes a serious physical, social and economic burden on the community which cannot reasonably be expected to be reversed or alleviated by private enterprise or governmental action, or both, without redevelopment. Among other things, the Project Area is characterized by buildings and structures, used or intended to be used for living, commercial, industrial, or other purposes, which are unfit or unsafe to occupy for such purposes and are conducive to juvenile delinquency and crime because of, among other things, inadequate provision for recreational facilities. In addition, the Project Area contains vacant and underutilized properties and properties which suffer from economic dislocation, deterioration or disuse, including depreciated or stagnant property values and impaired investments, and deteriorated, aged and obsolete buildings. The Project Area is characterized by the existence of inadequate public improvements, public facilities and open space that cannot be remedied by private or governmental action without redevelopment. The lack of adequate public improvements hinders economic development opportunities and contributes to the existence of depreciated and stagnant property values and impaired investments in the Project Area. Improvement and development of public parks and recreational facilities assist in elimination of blighted conditions in the Project Area. The construction and improvement of public recreational facilities relating to the civic center park project will enhance and provide additional needed facilities to serve the residents and taxpayers of the Project Area and the City. The project promotes physical and mental health, and helps correct the situation of inadequate facilities for recreational use and inadequate recreational improvements in the Project Area and the City, promote the sound development and redevelopment of the Project Area and reduce crime and juvenile delinquency, all for the benefit of the residents and taxpayers of the Project Area and the City. The parking structure will serve the Desert Willow Golf Resort and future hotel and other developments which would otherwise lack adequate public P6402.1056\892565.2 2 parking. The parking structure improvements are required in order to eliminate a factor which would substantially hinder the economically viable use of the Desert Willow Golf Resort. The undergrounding of utilities throughout the Project Area will eliminate unsightly and potentially hazardous overhead electrical, telephone and cable television lines, thereby improving the public health, safety and welfare. These in turn will assist in eliminating a factor which prevents or substantially hinders the economically viable use or capacity of buildings or lots and will encourage private -sector investment in the Project Area, thereby facilitating the redevelopment of the Project Area. The budget constraints of the City and the extraordinary voter approval requirements applicable to traditional methods of financing (such as general obligation bonds and community facilities district special tax bonds) as a practical matter prevent the City from financing the acquisition of such open space and the acquisition of the land for and the installation and construction of the above - described improvements by any other means. No moneys of the City were, are or are reasonably expected to be available on a Tong -term basis under the budget of the City to pay for the value of the land for open space or the value of the land for and the cost of the installation and construction of the above - described public improvements. Traditional methods of financing such as the issuance of general obligation bonds are unavailable as a practical matter because of the extraordinary majority voter approval requirements of two-thirds of the electorate. Assessment financing or special tax financing could overburden benefiting properties with assessments or special taxes and, in addition, special taxes require a two-thirds vote and assessments are subject to a majority protest. The installation and construction of the above -described improvements are all consistent with the Agency's implementation plan. Redevelopment Purpose; Elimination of Blight The construction and installation of the above -described public improvements will serve a basic purpose of redevelopment; redevelopment includes the provision of structures as may be appropriate or necessary in the interest of the general welfare, including recreational and other facilities, as well as the provision of public recreational areas and the provision for open -space types of use, such as streets. In addition, a fundamental purpose of redevelopment is to expand employment opportunities and to provide an environment for the social, economic and psychological growth and well-being of all citizens. The construction and installation of the above -described public improvements will assist in the elimination of blight in the Project Area which is caused by the lack of adequate public improvements, assist in the revitalization P6402.1056\892565.2 3 of the Project Area, help to reverse depreciated or stagnant property values and impaired investments, encourage private sector investment, create job opportunities, promote the economic viability of businesses in the Project Area, attract new businesses, assist in retaining existing businesses, and encourage business expansion, all for the health, safety and welfare of the residents and taxpayers of the Project Area and the City. P6402.1056\892565.2 4 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. 4 DATED: MAY 25, 2006 Estimate of Taxes The Palm Desert Financing Authority (the "Authority") proposes to issue bonds to finance payment for all or a portion of the cost of land for open space and the installation and construction of certain other public capital improvements, including the following: Acquisition / Improvement Estimated cost to be paid in whole or in part from bond proceeds Sound attenuation wall along Fred $3,000,000 Waring Drive Undergrounding of utilities throughout $14,000,000 the Project Area The amounts set forth above are based upon the current estimates of costs and availability of other funds that Agency believes are reasonable. Such amounts may vary depending on the actual costs and availability of funds. Pursuant to a proposed loan agreement between the Authority and the Palm Desert Redevelopment Agency (the "Agency"), the Agency would pay debt service on the Authority bonds from taxes ("tax increment revenues") allocated to the Agency pursuant to California Health and Safety Code Section 33670(b) from its Project Area No. 2 (the "Project Area"). The total estimated amount of tax increment revenues allocated to the Agency from the Project Area necessary to pay debt service on the Authority bonds issued to finance all or a portion of the above -described projects (assuming an aggregate initial principal amount of bonds of approximately $17,000,000 and an overall interest rate of 5.34 percent, a term of the bonds of 29 years), would be approximately $38,500,000. To the extent that such bonds issued by the Authority are not sufficient to pay for all of the costs of the above -described land and public capital improvements, the Agency will pay for the balance of such costs from other available funds of the Agency. P6402. l 057\892567.2 1 Facts Supporting Determinations The Project Area is an area in which there exists a combination of conditions of blight so prevalent and so substantial that it causes a reduction of, or lack of, proper utilization of the area to such an extent that it constitutes a serious physical, social and economic burden on the community which cannot reasonably be expected to be reversed or alleviated by private enterprise or govemmental action, or both, without redevelopment. Among other things, the Project Area is characterized by buildings and structures, used or intended to be used for living, commercial, industrial, or other purposes, which are unfit or unsafe to occupy for such purposes and are conducive to juvenile delinquency and crime because of, among other things, inadequate provision for recreational facilities. In addition, the Project Area contains vacant and underutilized properties and properties which suffer from economic dislocation, deterioration or disuse, including depreciated or stagnant property values and impaired investments, and deteriorated, aged and obsolete buildings. The Project Area is characterized by the existence of inadequate public improvements, public facilities and open space that cannot be remedied by private or governmental action without redevelopment. The lack of adequate public improvements hinders economic development opportunities and contributes to the existence of depreciated and stagnant property values and impaired investments in the Project Area. Fred Waring Drive is a major east —west arterial, which run parallel to Highway 111. The proposed sound attenuation wall improve public health, safety and welfare and enhance the development and redevelopment of the Project Area. The undergrounding of utilities throughout the Project Area will eliminate unsightly and potentially hazardous overhead electrical, telephone and cable television lines, thereby improving the public health, safety and welfare. These in turn will assist in eliminating a factor which prevents or substantially hinders the economically viable use or capacity of buildings or Tots and will encourage private -sector investment in the Project Area, thereby facilitating the redevelopment of the Project Area. The budget constraints of the City and the extraordinary voter approval requirements applicable to traditional methods of financing (such as general obligation bonds and community facilities district special tax bonds) as a practical matter prevent the City from financing the acquisition of such open space and the acquisition of the land for and the installation and construction of the above - described improvements by any other means. No moneys of the City were, are or are reasonably expected to be available on a Tong -term basis under the budget of the City to pay for the value of the land for open space or the value of the land for and the cost of the installation and construction of the above - described public improvements. Traditional methods of financing such as the issuance of general obligation bonds are unavailable as a practical matter P6402.1057\892567.2 2 because of the extraordinary majority voter approval requirements of two-thirds of the electorate. Assessment financing or special tax financing could overburden benefiting properties with assessments or special taxes and, in addition, special taxes require a two-thirds vote and assessments are subject to a majority protest. The installation and construction of the above -described improvements are all consistent with the Agency's implementation plan. Redevelopment Purpose: Elimination of Blight The construction and installation of the above -described public improvements will serve a basic purpose of redevelopment; redevelopment includes the provision of structures as may be appropriate or necessary in the interest of the general welfare, including recreational and other facilities, as well as the provision of public recreational areas and the provision for open -space types of use, such as streets. In addition, a fundamental purpose of redevelopment is to expand employment opportunities and to provide an environment for the social, economic and psychological growth and well-being of all citizens. The construction and installation of the above -described public improvements will assist in the elimination of blight in the Project Area which is caused by the lack of adequate public improvements, assist in the revitalization of the Project Area, help to reverse depreciated or stagnant property values and impaired investments, encourage private sector investment, create job opportunities, promote the economic viability of businesses in the Project Area, attract new businesses, assist in retaining existing businesses, and encourage business expansion, all for the health, safety and welfare of the residents and taxpayers of the Project Area and the City. P6402.1057\892567.2 3 CITY OF PALM DESERT PALM DESERT FINANCING AUTHORITY PALM DESERT REDEVELOPMENT AGENCY STAFF REPORT REQUEST: APPROVAL OF RESOLUTION NO. 06-74 OF THE CITY COUNCIL OF THE CITY OF PALM DESERT SUPPLEMENTING RESOLUTION NO. 06-56 AND FURTHER 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) APPROVAL OF RESOLUTION NO. FA-55 OF THE PALM DESERT FINANCING AUTHORITY ACKNOWLEDGING A FINDING OF SIGNIFICANT BENEFIT AND AFFIRMING THE AUTHORITY'S APPROVAL OF DOCUMENTS AND CERTAIN OTHER MATTERS RELATING TO 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) APPROVAL OF RESOLUTION NO. 527 OF THE PALM DESERT REDEVELOPMENT AGENCY AFFIRMING THE AGENCY'S APPROVAL OF DOCUMENTS AND CERTAIN OTHER MATTERS RELATING TO THE SALE AND ISSUANCE BY THE PALM DESERT FINANCING AUTHORITY OF 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) SUBMITTED BY: DAVE YRIGOYEN, DIRECTOR OF REDEVELOPMENT/HOUSING DATE: JUNE 8, 2006 CONTENTS: (1) CITY COUNCIL RESOLUTION NO. 06-74 (2) PALM DESERT FINANCING AUTHORITY RESOLUTION NO. FA-55 (3) PALM DESERT REDEVELOPMENT AGENCY RESOLUTION NO.527 Recommendation: By Minute Motion: 1. That the City Council approve Resolution No. 06- 74 , making (i) findings of significant public benefit in connection with the issuance and sale of two series of bonds (the "Bonds") by the Palm Desert Financing Authority: (A) Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), 2006 Series A Staff Report Approval of Council, PDFA and RDA Resolutions — PA#1 Tax Alloc. Bonds Page 2 of 3 June 8, 2006 (the "Series 2006A Bonds"), and (B) Tax Allocation Revenue Refunding Bonds (Project Area No. 1, As Amended), 2006 Series B (Taxable) (the "Series 2006B Bonds"), and (ii) findings pursuant to Sections 33679 and 33445 of the California Health and Safety Code with respect to the projects to be funded by proceeds of the Series 2006A Bonds; 2. That the Palm Desert Financing Authority approve Resolution No. FA- 55 , acknowledging finding of significant public benefit in connection with the issuance and sale of the Bonds and affirming the Authority's approval of the issuance, sale and delivery of the Bonds and the Authority's authorizations regarding the execution and delivery of documents relating to the Bonds; and 3. That the Palm Desert Redevelopment Agency approve Resolution No.527 affirming the Agency's approval and authorizations regarding the execution and delivery of documents relating to the Bonds. Executive Summary Adoption of the attached resolutions will allow Staff to proceed with the issuance of the Bonds and the use of Series 2006A Bonds proceeds to pay for the costs of certain projects. Background and discussion: Staff has recommended the issuance of two series of Bonds relating to the financing and refinancing of projects for the Agency's Project Area No. 1, As Amended ("Project Area No. 1). The Series 2006A Bonds will be issued as tax-exempt bonds. Net proceeds of the Series 2006A Bonds will be used to pay all or a portion of the costs of certain Agency projects benefiting Project Area No. 1. The Series 2006E Bonds will be issued as taxable bonds. Net Proceeds of the Series 2006B Bonds will be used to refund a portion of certain bonds issued by the Authority in 1997, the proceeds of which were used for the development of the Desert Willow Golf Resort. Based on most recent estimates by the Financial Advisor and the Underwriter for the Bonds, the sale of the Series 2006A Bonds is expected to generate approximately $39,000,000 of net proceeds to be available for Agency projects. Previously on April 27, 2006, the City Council, the Authority and the Agency adopted resolutions approving the issuance, sale and delivery of the Bonds and proposed projects to be funded by the proceeds of the Series 2006A Bonds. After the April 27, 2006 Council meeting, Staff undertook to review the various potential Agency projects with respect to Project Area No. 1 and proposes to modify and expand on the proposed projects to be funded by the proceeds of the Series 2006A Bonds. The proposed projects are outlined in the attached City Council resolution and are also described in an Amended Summary Report, which was made available to the public in connection with the City Council public hearing. Staff Report Approval of Council, PDFA and RDA Resolutions — PA#1 Tax Alloc. Bonds Page 3 of 3 June 8, 2006 Adoption of the attached resolutions will allow Staff to proceed with the issuance of the Bonds and the use of Series 2006A proceeds to pay for the costs of the identified projects. Submitted by: Dave Yrigoy& Director of R evelopment/Housing Ap oval: cCarthy, ACM lopment Carlos L. rtegity Manager/CAO pe$ Paul S.Gbso7Director of Finance COUNCIL ACTION APPROVED DENIED RECEIVED OTHER itiocke, C-/Vas• ,Q4150/7 MEETING DATE fa.- gv-o60 AYES:seeMaterile... KeZ64,49ieed, am/ ic--6311/dOrl OES: Mot_ ABSENT: Malt, AESTAIN:_jsicetr_ VERIFIED BY: ifikh Original on File th City Clerk's Office 40prc3kred . BY RDA ON g.°412 VERIFIED BY 11260.-)1(a) Original on file with City Clerk's Office ifProre-ci BY FIN AUTH ON . °C° ......., VERIFIED BY: '-Dt<inacitn Original on file with City Clerk's Office RESOLUTION NO. 06- 74 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT SUPPLEMENTING RESOLUTION NO. 06-56 AND FURTHER 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 2006B Bonds are to be applied to make a loan to the Palm Desert Redevelopment Agency (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 WHEREAS, proceeds of the Series 2006A Bonds are to be applied to make a loan to 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"); and WHEREAS, this City Council previously adopted Resolution No. 06-56, on April 27, 2006, (i) approving the issuance of the Bonds, and (ii) finding the financing and refinancing of the public capital improvements 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 (the "City"); and WHEREAS, Resolution No. 06-56 identified certain projects proposed to be financed with proceeds of the Series 2006A Bonds; and WHEREAS, upon further review, Agency Staff proposes to modify the projects to include the following (with the following projects (the "Projects") to supersede those previously identified in Resolution No. 06-56): (i) core commercial areas projects (including public infrastructure, parking improvements and other improvements at and around Westfield shopping center, Highway 111 and El Paseo); (ii) improvements to P6402.1054\892279.2 frontage roads along Highway 111 — Alessandro Alleyway (including street landscaping, parking improvements and other improvements); (iii) renovation and improvement of parking facilities at President's Plaza; (iv) El Paseo (west of Highway 74) extension and upgrade (including median work, landscaping, lighting and other related improvements); (v) development of a multi -purpose community center at El Paseo and Highway 111; (vi) construction of Portola Avenue Bridge across the Whitewater Channel; (vii) widening of Monterey Avenue from Magnesia Falls Drive to Gerald Ford Drive; (viii) widening of Portola Avenue between Fred Waring Drive and Magnesia Falls Drive; and (ix) undergrounding of neighborhood utilities throughout the Project Area; and WHEREAS, pursuant to Section 6586.5 of the Califomia Government Code and Section 33679 of the California Health and Safety Code, after notice duly published in accordance with law, this City Council held a public hearing on this date with respect to the proposed Projects to be financed by the issuance of the Series 2006A Bonds and the issuance of the Bonds and received evidence concerning the public benefits therefrom; and WHEREAS, there has been made available in the office of the City Clerk for two weeks prior to such public hearing for public inspection and copying, at a cost not to exceed the cost of duplication, an amended summary report which includes all of the following: (i) estimates of the amount of such taxes allocated to the Agency from the Project Area proposed to be used to pay for the Projects, including interest payments; (ii) facts supporting the determinations required to be made by the City Council pursuant to Califomia Health and Safety Code Section 33445; and (iii) the redevelopment purpose for which such taxes are being used to pay for the installation and construction. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT DOES HEREBY FIND, 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 affirms its finding that the refinancing described above through the issuance by the Authority of the Series 2006B Bonds will result in significant public benefits to the constituents of the Agency and the City of Palm Desert. The City Council hereby finds that financing of the Projects described in the Recitals of this Resolution through the issuance by the Authority of the Series 2006A 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 ratifies and affirms the its approval of the issuance of the Bonds by the Authority. P6402.1054\892279.2 Section 3. Further Findings. The City Council hereby finds and determines that based upon the "Amended 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 Projects described in the Recitals of this Resolution are of benefit to the Project Area and to the immediate neighborhoods in which the Projects are located; (ii) the payment of funds for the cost of such Projects 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 Projects 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 Agency. The City Council hereby approves payment by the Agency for the cost of the installation and construction of the above -described Projects 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. Section 6. Effective Date. This Resolution shall take effect immediately upon adoption. P6402.1054\892279.2 wit: APPROVED and ADOPTED this 8th day of June 2006 by following vote to AYES: NOES: ABSENT: ABSTAIN: Jim Ferguson, Mayor ATTEST: Rachelle D. Klassen, City Clerk P6402.1054\892279.2 RESOLUTION NO. FA- 55 A RESOLUTION OF THE PALM DESERT FINANCING AUTHORITY ACKNOWLEDGING A FINDING OF SIGNIFICANT BENEFIT AND AFFIRMING THE AUTHORITY'S APPROVAL OF DOCUMENTS AND CERTAIN OTHER MATTERS RELATING TO 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) 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 an indenture of trust (the "Indenture"); and WHEREAS, proceeds of the Series 2006A Bonds are to be applied to make a loan to the Agency pursuant to a loan agreement (the "Loan Agreement") 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 2006E Bonds are to be applied to make 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 WHEREAS, on April 27, 2006, the City Council of the City of Palm Desert adopted its Resolution No. 06-56 ("City Council Resolution No. 06-56), making certain P6402.1054\892282.2 findings, including a finding of significant benefits, with respect to (i) the refinancing to be accomplished through the issuance of the Series 2006B Bonds, and (ii) the financing of certain capital improvement projects through the issuance of the Series 2006A Bonds; and WHEREAS, on April 27, 2006, the Authority adopted Resolution No. FA- 51 and Resolution No. FA-53, approving the forms of documents relating to the issuance of the Bonds, authorizing the execution and delivery thereof and setting forth certain parameters with respect to the terms of the Bonds; and WHEREAS, City Resolution No. 06-56 identified certain projects proposed to be financed with the proceeds of the Series 2006A Bonds; and WHEREAS, upon further review, Agency Staff has proposed to modify the projects, to include the following (collectively, the "Projects"): (i) core commercial areas projects (including public infrastructure, parking improvements and other improvements at and around Westfield shopping center, Highway 111 and El Paseo); (ii) improvements to frontage roads along Highway 111 — Alessandro Alleyway (including street landscaping, parking improvements and other improvements); (iii) renovation and improvement of parking facilities at President's Plaza; (iv) El Paseo (west of Highway 74) extension and upgrade (including median work, landscaping, lighting and other related improvements); (v) development of a multi -purpose community center at El Paseo and Highway 111; (vi) construction of Portola Avenue Bridge across the Whitewater Channel; (vii) widening of Monterey Avenue from Magnesia Falls Drive to Gerald Ford Drive; (viii) widening of Portola Avenue between Fred Waring Drive and Magnesia Falls Drive; and (ix) undergrounding of neighborhood utilities throughout the Project Area; and WHEREAS, on June 8, 2006, after a duly held public hearing, the City Council adopted a new resolution, (i) finding that the financing of the Projects, as now proposed by the Agency Staff, through the issuance by the Authority of the Series 2006A Bonds will result in significant public benefits to the constituents of the Agency and the City of Palm Desert, and (ii) affirming the City Council's approval of the issuance of the Bonds by the Authority; 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 benefits and hereby approves and authorizes the issuance and sale of the Bonds. Section 3.Affirmation of Resolution No. FA-51 and Resolution No. FA-53. Except as set forth in the next sentence, the Authority hereby affirms Resolution No. P6402.1054\892282.2 2 FA-51 and Resolution No. FA-53 (the "Prior Resolutions") in their entirety, including the approval, authorization and direction for the issuance of the Bonds, the execution and delivery of the Indenture, Loan Agreement, the Escrow Agreement, the Official Statement and the Purchase Agreement. The Authority hereby further affirms the parameters for the terms of the Bonds as set forth in Section 10 of Prior Resolutions, except that the true interest cost with respect to the Series 2006A Bonds shall not exceed 6.25 percent. Section 4.Other Acts. The 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 and the Prior Resolutions, and any such actions previously taken by such officers are hereby ratified and confirmed. Section 5. Effective Date. This Resolution shall take effect immediately upon adoption. to wit: APPROVED AND ADOPTED this 8th day of June 2006 by following vote AYES: NOES: ABSENT: ABSTAIN: Jim Ferguson, President ATTEST: Rachelle D. Klassen, Secretary P6402.1054\892282.2 3 RESOLUTION NO. 527 A RESOLUTION OF THE PALM DESERT REDEVELOPMENT AGENCY AFFIRMING THE AGENCY'S APPROVAL OF DOCUMENTS AND CERTAIN OTHER MATTERS RELATING TO THE SALE AND ISSUANCE BY THE PALM DESERT FINANCING AUTHORITY OF 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 determined 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 to make a loan (the "Series 2006A Loan") to the Palm Desert Redevelopment Agency (the "Agency") pursuant to a loan agreement (the "Loan Agreement") 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 to make a second loan (together with the Series 2006A Loan, the "Loans") 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 WHEREAS, on April 27, 2006, the City Council of the City of Palm Desert adopted its Resolution No. 06-56 ("City Council Resolution No. 06-56), making certain findings, including a finding of significant benefit, with respect to (i) the refinancing to be accomplished through the issuance of the Series 2006B Bonds, and (ii) the financing of certain capital improvement projects through the issuance of the Series 2006A Bonds; and WHEREAS, on April 27, 2006, the Agency adopted Resolution No. 524, approving the forms of documents relating to the issuance of the Bonds and authorizing the execution and delivery thereof; and WHEREAS, City Resolution No. 06-56 identified certain projects proposed to be financed with the proceeds of the Series 2006A Bonds; and P6402.1054\892281.2 1 WHEREAS, upon further review, Agency Staff has proposed to modify such projects, to include the following (collectively, the "Projects"): (i) core commercial areas projects (including public infrastructure, parking improvements and other improvements at and around Westfield shopping center, Highway 111 and El Paseo); (ii) improvements to frontage roads along Highway 111 — Alessandro Alleyway (including street landscaping, parking improvements and other improvements); (iii) renovation and improvement of parking facilities at President's Plaza; (iv) El Paseo (west of Highway 74) extension and upgrade (including median work, landscaping, lighting and other related improvements); (v) development of a visitors' center at El Paseo and Highway 111; (vi) construction of Portola Avenue Bridge across the Whitewater Channel; (vii) widening of Monterey Avenue from Magnesia Falls Drive to Gerald Ford Drive; (viii) widening of Portola Avenue between Fred Waring Drive and Magnesia Falls Drive; and (ix) undergrounding of neighborhood utilities throughout the Project Area; and WHEREAS, on June 8, 2006, after a duly held public hearing, the City Council adopted a new resolution, (i) finding that the financing of the Projects, as now proposed by the Agency Staff, through the issuance by the Authority of the Series 2006A Bonds will result in significant public benefits to the constituents of the Agency and the City of Palm Desert, and (ii) affirming the City Council's approval of the issuance of the Bonds by the Authority; NOW, THEREFORE, THE PALM DESERT REDEVELOPMENT AGENCY DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. Recitals. The above recitals, and each of them, are true and correct. Section 2. Affirmation of Resolution No. 524. The Agency hereby affirms Resolution No. 524 in its entirety, including the approval, authorization and direction for the execution and delivery of the Loan Agreement, the Escrow Agreement, the Continuing Disclosure Agreement, the Purchase Agreement and the costs of issuance requisitions. Section 3. Other Acts. The officers of the Agency 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 Resolution No. 524, and any such actions previously taken by such officers are hereby ratified and confirmed. Section 4. Effective Date. This Resolution shall take effect immediately upon adoption. P6402.1054\892281.2 wit: APPROVED and ADOPTED this 8th day of June 2006 by following vote to AYES: NOES: ABSENT: ABSTAIN: Jim Ferguson, Chairman ATTEST: Rachelle D. Klassen, Secretary P6402.1054\892281.2