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HomeMy WebLinkAboutCC RES 07-13RESOLUTION NO. 07-13 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, ACTING FOR ITSELF AND AS THE LEGISLATIVE BODY OF CITY OF PALM DESERT COMMUNITY FACILITIES DISTRICT NO. 2005-1 (UNIVERSITY PARK) TO AUTHORIZE THE ISSUANCE OF ITS SPECIAL TAX BONDS, SERIES 2007, IN A PRINCIPAL AMOUNT NOT TO EXCEED TWENTY MILLION DOLLARS ($20,000,000) AND APPROVING CERTAIN DOCUMENTS AND TAKING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH RECITALS: WHEREAS, the City Council of the City of Palm Desert, located in Riverside County, California (the "City Council", and hereinafter sometimes referred to also as the "legislative body of the District"), has heretofore undertaken proceedings and declared the necessity of City of Palm Desert Community Facilities District No. 2005-1 (University Park) (the "District") to issue bonds pursuant to the terms and provisions of the Mello - Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the "Act"); and WHEREAS, pursuant to Resolution Nos. 06-8 and 06-9 adopted by the legislative body of the District on January 12, 2006, certain bond propositions were submitted to the qualified electors within the District, and were approved by more than two-thirds of the votes cast at the elections held within the District on January 12, 2006; and WHEREAS, based upon Resolution Nos. 06-8 and 06-9 and the elections, the District is now authorized to issue bonds in one or more series, pursuant to the Act, in an aggregate principal amount not to exceed $70,000,000; and WHEREAS, the District has heretofore issued and sold $50,000,000 of such authorized bonds; and WHEREAS, at this time, the legislative body of the District desires to issue and sell an additional portion of such authorized bonds for the District under the Act to finance certain public facilities which the District is authorized to finance, and the District desires to accomplish the financing of such public facilities to serve the District through the issuance of bonds up to an aggregate principal amount not to exceed $20,000,000 as a series to be designated as the "City of Palm Desert Community Facilities District No. 2005-1 (University Park) Special Tax Bonds, Series 2007" (the "Bonds"); and WHEREAS, the Acquisition Agreement, dated as of March 23, 2006 (the "Acquisition Agreement"), by and among the City of Palm Desert (the "City"), the District, and certain developers of land within the District (the "Developers") specifies certain of such authorized public facilities as "Backbone Infrastructure," which Backbone Infrastructure includes, among other facilities, four well sites (including land acquisition and improvements) to be located at sites as determined by the Coachella Valley Water District concurrently with land plan, final tentative map(s), or similar document(s) (as 944844.4 RESOLUTION NO. 07-13 appropriate) heretofore or to be approved by the City's Planning Commission and the City Council (collectively, the "Well Sites"); and WHEREAS, in order to protect the City and District against construction cost increases and to provide for the full cost of the Backbone Infrastructure from proceeds of bonds issued by the District, pursuant to Section 3.1 of the Acquisition Agreement, the parties thereto have heretofore agreed the issuance of a second series of bonds by the District, if authorized by the City Council in its absolute discretion, shall be subject to the prior receipt of bids, pursuant to the terms of the Acquisition Agreement, for the construction of all Backbone Infrastructure (except for the Cook Street pedestrian bridge and the land acquisition components of the authorized park sites and the Well Sites), including but not limited to the costs of improving the Well Sites (collectively, the "Well Sites Improvements"); and WHEREAS, construction of the Well Sites Improvements is not imminent and is contingent upon the construction of certain development within the District by the owners of land therein, which construction is, based on an absorption study contained within the appraisal prepared for the District and referenced in Section 2 below, reasonably expected to occur within one-half to four years from the date hereof; and WHEREAS, construction of the Well Sites Improvements in any event is required to be provided by the owners of land therein as a condition of regulatory approval (regardless of the availability of proceeds of bonds issued by the District); and WHEREAS, the Developers have requested the City and District to expedite the issuance of the second series of bonds and authorize the issuance of such bonds prior to the receipt of bids for the construction of the Well Sites Improvements but after the receipt of all other bids required pursuant to Section 3.1 of the Acquisition Agreement; and WHEREAS, heretofore, bids have been received for all facilities required pursuant to Section 3.1 of the Acquisition Agreement prior to the issuance of a second series of bonds, except for the Well Sites Improvements, for which no bids have yet been requested or received; and WHEREAS, in order to facilitate construction of the balance of the authorized public facilities to serve the District, other than the Well Sites Improvements, in a timely manner, the City and District are willing to waive the requirements of Section 3.1 of the Acquisition Agreement as to the Well Sites Improvements only, through a supplement to the Acquisition Agreement executed by the parties thereto; and WHEREAS, additionally, Section 3.3.A. of the Acquisition Agreement provides for the allocation and deposit of proceeds of the Bonds with a priority for allocating proceeds to, and depositing proceeds into, accounts designated for the estimated costs of Backbone Infrastructure; and WHEREAS, with respect to an authorized facility constituting Backbone Infrastructure for which no bids have been received nor any contract awarded (such as the Well Sites Improvements), the aforementioned provisions of the Acquisition 2 944844.4 RESOLUTION NO. 07-13 Agreement provide that the amount to be deposited with respect to such a facility shall be based upon the amount for such facility estimated and set forth in a cost estimate report dated September 22, 2005 and prepared by RBF Consulting; and WHEREAS, subsequently, the Coachella Valley Water District has altered the specifications of the Wells Sites Improvements to require such sites to be paved, which alterations have significantly increased the costs of the Well Sites Improvements, and RBF Consulting has prepared a revised cost estimate letter as to the Well Sites Improvements, dated February 13, 2007; and WHEREAS, with respect to the Well Sites Improvements, certain Developers (Palm Desert Funding Company, LP, and Sinatra & Cook Project, LLC) desire to amend the Acquisition Agreement to provide that the amount to be deposited shall be based upon the amounts for such facilities estimated and set forth in RBF Consulting's revised cost estimate letter dated February 13, 2007, rather than RBF Consulting's cost estimate report dated September 22, 2005, and the other Developers, the City, and the District are willing to supplement and amend the Acquisition Agreement in such a manner and upon such terms and conditions as approved by the City Council; and WHEREAS, although certain forthcoming legislative approvals such as certain zoning or specific plan approvals for the proposed development within the District have not yet been issued, the City will derive special benefits from the issuance of Bonds by the District at this time, because the District's financing of the public facilities which it is authorized to finance, by the issuance of Bonds, will enable the improvement of the major streets within the District (including without limitation Gerald Ford Drive, Portola Avenue, Cook Street, and Frank Sinatra Drive) at a significantly earlier time than possible without the assistance of the District's issuance of Bonds, and the improvement of such streets are of a high priority to the City Council; and WHEREAS, the legislative body of the District has determined that it is prudent in the management of its fiscal affairs to issue the Bonds; and WHEREAS, the value of the real property in the District subject to the special tax to pay debt service on the Bonds is not Tess than three times the principal amount of the Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within the District, which fact is required as a precondition to the issuance of the Bonds; and WHEREAS, in order to effect the issuance of the Bonds, the City Council, for itself and as the legislative body of the District, desires to approve the form of a Preliminary Official Statement for the Bonds and to approve the forms of, and authorize the execution and delivery of, a Supplemental Indenture, a Bond Purchase Agreement, a First Supplement to Acquisition Agreement, and a Continuing Disclosure Agreement for the Bonds, the forms of which are on file with the City Clerk. 3 944844.4 RESOLUTION NO. 07-13 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT, ACTING FOR ITSELF AND AS THE LEGISLATIVE BODY OF CITY OF PALM DESERT COMMUNITY FACILITIES DISTRICT NO. 2005-1 (UNIVERSITY PARK), DOES HEREBY RESOLVE AS FOLLOWS: 1. Each of the above recitals is true and correct and is adopted by the City Council, acting for itself and as the legislative body of the District. 2. The legislative body of the District hereby finds and determines that, as determined in accordance with Section 53345.8 of the Act and as required by the City of Palm Desert policies adopted on October 13, 2005 pursuant to Section 53312.7 of the Act (the "Mello -Roos Goals and Policies"), the value of the real property in the District subject to the special tax to pay debt service on the Bonds is not less than three times the principal amount of the Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within the District. This determination is based on the value of the real property within the District in an appraisal prepared for the District, which appraisal has been made in a manner consistent with the Mello -Roos Goals and Policies. 3. The Mello -Roos Goals and Policies requires that the development proposed within a community facilities district must have received any required legislative approvals such as zoning or specific plan approvals prior to the issuance of public debt, but the Mello -Roos Goals and Policies also provide that such requirement may be waived if the City Council finds that such waiver is reasonable given identified special City benefits to be derived from such waiver. The City Council hereby finds and determines that although certain forthcoming legislative approvals such as certain zoning or specific plan approvals for the proposed development within the District have not yet been issued, the City will derive special benefits from the issuance of Bonds by the District at this time, because the District's financing of the public facilities which it is authorized to finance, by the issuance of Bonds, will enable the improvement of the major streets within the District (including without limitation Gerald Ford Drive, Portola Avenue, Cook Street, and Frank Sinatra Drive) at a significantly earlier time than possible without the assistance of the District's issuance of Bonds, and the improvement of such streets are of a high priority to the City Council. The City hereby waives the aforementioned requirement set forth in the Mello -Roos Goals and Policies relating to legislative developmental approvals and finds that such waiver is reasonable in view of the above -described special benefits for road improvements the City will receive due to the District's issuance of the Bonds. 4. The issuance of the Bonds in an aggregate principal amount not to exceed $20,000,000 is hereby authorized, with the exact principal amount of the Bonds to be determined by the official signing the Bond Purchase Agreement in accordance with Section 7 below. The legislative body of the District hereby determines that it is prudent in the management of its fiscal affairs to issue the Bonds. The Bonds shall mature on the dates and pay interest at the rates set forth in the Bond Purchase Agreement to be executed on behalf of the District in accordance with Section 7 hereof. The Bonds shall be governed by the terms and conditions of the First Supplemental Indenture presented 4 944844.4 RESOLUTION NO. 07-13 at this meeting, on file with the City Clerk and incorporated herein by reference (the "Supplemental Indenture"). The Supplemental Indenture shall be executed by the Mayor of the City of Palm Desert (the "Mayor") or the City Manager of the City of Palm Desert (the "City Manager", and together with the Mayor, the "Authorized Officers") in substantially the form presented at this meeting, with such additions thereto and changes therein as may be approved by such officer upon consultation with Richards, Watson & Gershon, A Professional Corporation ("Bond Counsel"). Approval of such changes shall be conclusively evidenced by the execution and delivery of the Indenture by any one of the Authorized Officers. The date or dates, maturity or maturities, pledge or assignment of any revenues of the District to the repayment of the Bonds, the manner of investment of any bond proceeds and other revenues, manner of payment, interest rate or rates, interest payment dates, denominations, form, registration privileges, manner of execution, place of payment, terms of redemption, rebate provisions, and other terms of the Bonds shall be as provided in the Supplemental Indenture as finally executed and shall be in conformance with any such terms set forth in the Bond Purchase Agreement described in Section 7 below and Official Statement described in Section 9 below and delivered to the purchasers of the Bonds. Capitalized terms used in this Resolution which are not defined herein have the meanings ascribed to them in the Supplemental Indenture. 5. The Bonds shall be executed on behalf of the District by the manual or facsimile signature of the Mayor and the seal of the District or the City, or a facsimile thereof shall be impressed or imprinted thereon and attested with the manual or facsimile signature of the City Clerk. Wells Fargo Bank, National Association, is hereby appointed to act as trustee for the Bonds. 6. Pursuant to Section 53356.1 of the Act, the legislative body of the District hereby covenants, for the benefit of the Bondowners, to commence and diligently pursue any foreclosure action regarding delinquent installments of any amount levied as a special tax for the payment of interest or principal of the Bonds, such foreclosure action to be commenced and pursued as more completely set forth in the Indenture. 7. The form of the Bond Purchase Agreement by and among the City (on behalf of the District), Stinson Securities, LLC, and Kinsell, Newcomb and De Dios, Inc. (collectively, the "Underwriter") presented at this meeting, on file with the City Clerk and incorporated herein by reference (the "Bond Purchase Agreement"), is hereby approved, and any one of the Authorized Officers is hereby authorized to execute the Bond Purchase Agreement in substantially the form hereby approved, with such additions thereto and changes therein as may be approved by such officer upon consultation with Bond Counsel. Approval of such additions and changes shall be conclusively evidenced by the execution and delivery of the Bond Purchase Agreement; provided, however, that the Bond Purchase Agreement shall be signed only if the Bonds are purchased by the Underwriter at an overall interest rate that does not exceed 7.0% per annum for the issue as a whole (calculated utilizing the true interest cost method) and the discount paid to the Underwriter (exclusive of original issue discount) does not exceed 1.5% of the principal amount of the Bonds. The legislative body of the District hereby finds and determines, pursuant to Section 53360.4 of the Act, that the sale of the Bonds at negotiated sale to the Underwriter, as contemplated by the Bond Purchase 5 944844.4 RESOLUTION NO. 07-13 Agreement, will result in a lower overall cost than a public sale. Each of the Authorized Officers is authorized to determine the day on which the Bonds are to be priced in order to attempt to produce the lowest borrowing cost for the District and may reject any terms presented by the Underwriter if determined not to be in the best interest of the District. 8. The form of the First Supplement to Acquisition Agreement by the City and the District (which Acquisition Agreement is dated as of March 23, 2006 and entered into by and among the City, the District, Palm Desert Funding Company, LP, a Delaware limited partnership, for itself and as successor to and assignee of Desert Wells 237, LLC and Albor Properties III, L.P., Palm Desert University Village, LLC, a California limited liability company (formerly known as The University Village Partnership, a California general partnership), Shaw/Palm Desert 1, LLC, a California limited liability company, and Sinatra & Cook Project, LLC, a California limited liability company), presented at this meeting, on file with the City Clerk and incorporated herein by reference (the "First Supplement to Acquisition Agreement"), is hereby approved, and any one of the Authorized Officers is hereby authorized and directed to execute the First Supplement to Acquisition Agreement in substantially the form hereby approved, with such additions therein and changes thereto as the Authorized Officer or Authorized Officers executing the same may approve, with such approval to be conclusively evidenced by the execution and delivery of the First Supplement to Acquisition Agreement. 9. The form of the Preliminary Official Statement presented at this meeting, on file with the City Clerk and incorporated herein by reference (the "Preliminary Official Statement") is hereby approved, and the Underwriter is hereby authorized to distribute the Preliminary Official Statement to prospective purchasers of the Bonds in substantially the form hereby approved, together with such additions thereto and changes therein as are determined necessary by any one of the Authorized Officers to make the Preliminary Official Statement final as of its date for purposes of Rule 15c2-12 promulgated under the Securities Exchange Act of 1934 of the Securities and Exchange Commission, including, but not limited to, such additions and changes as are necessary to make all information set forth therein accurate and not misleading. Each of the Authorized Officers is hereby authorized to execute a final Official Statement in substantially the form of the Preliminary Official Statement, together with such changes as are determined necessary by the Authorized Officer executing the Official Statement to make such Official Statement complete and accurate as of its date. The Underwriter is further authorized to distribute the final Official Statement for the Bonds and any supplement thereto to the purchasers thereof upon its execution on behalf of the District as described above. 10. The form of the Continuing Disclosure Agreement presented at this meeting, on file with the City Clerk as appended to the Preliminary Official Statement and incorporated herein by reference (the "Continuing Disclosure Agreement"), is hereby approved, and any one of the Authorized Officers is hereby authorized and directed to execute the Continuing Disclosure Agreement in substantially the form hereby approved, with such additions therein and changes thereto as the Authorized Officer or Authorized Officers executing the same deem necessary to cure any defect or ambiguity therein if such change does not materially alter the substance or content 6 944844.4 RESOLUTION NO. 07-13 thereof, with such approval to be conclusively evidenced by the execution and delivery of the Continuing Disclosure Agreement. 11. All actions heretofore taken by the officers and agents of the City and the District with respect to the establishment of the District, the issuance and sale of the Bonds, or in connection with or related to any of the agreements or documents referenced herein are hereby approved, confirmed, and ratified. The Mayor, each of the Authorized Officers, and the officers and staff of the City and the District responsible for the fiscal affairs of the District are hereby authorized and directed to take any actions, and execute and deliver any and all documents as are necessary to accomplish (a) the issuance, sale and delivery of the Bonds in accordance with the provisions of this Resolution, (b) the transactions contemplated by the Supplemental Indenture, the Bond Purchase Agreement, the First Supplement to Acquisition Agreement, and the Continuing Disclosure Agreement, and (c) the fulfillment of the purposes of the Bonds as described in the Indenture, including, but not limited to, providing certificates as to the accuracy of any information relating to the District which is included in the Official Statement. In the event that the Mayor is unavailable to sign any document authorized for execution herein, any Authorized Officer may sign such document. Any document authorized herein to be signed by the City Clerk may be signed by a duly appointed deputy clerk. 12. This Resolution shall take effect upon its adoption. The City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original resolutions. 13. PASSED AND ADOPTED this 8th day of March, 2007, by the following vote: AYES: BENSON, FERGUSON, FINERTY, SPIEGEL, and KELLY NOES: NONE ABSENT: NONE ABSTAIN: NONE ATTEST: RA H LLE i. KLA N, CITY CLERK CITY OF PALM DESERT, CALIFORNIA C , 24d(-6 R AI'�D S. KLLY, MAYOR/ 944844.4