HomeMy WebLinkAboutSA-RDA 062RESOLUTION NO. SA-RDA 062
A RESOLUTION OF THE BOARD OF DIRECTORS TO THE SUCCESSOR
AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY
AUTHORIZING THE EXECUTION AND DELIVERY OF A BOND
PURCHASE CONTRACT, AN OFFICIAL STATEMENT, AN ESCROW
AGREEMENT AND OTHER DOCUMENTS IN CONNECTION WITH THE
SUCCESSOR AGENCY'S ISSUANCE OF TAX ALLOCATION
REFUNDING (NON-HOUSING) BONDS AND TAKING RELATED
ACTIONS
RECITALS:
A. The former Palm Desert Redevelopment Agency (the "Former Agency")
was a duly constituted redevelopment agency pursuant to provisions of the Community
Redevelopment Law (the "Redevelopment Law") set forth in Section 33000 et seq. of
the Health and Safety Code ("HSC") of the State of California (the "State").
B. The Former Agency undertook to redevelop four project areas
(collectively, the "Project Areas").
C. The Former Agency and the City of Palm Desert (the "City") executed and
delivered a Joint Exercise of Powers Agreement, dated as of January 26, 1989 (the
"Joint Powers AgreemenY'), which Joint Powers Agreement created and established the
Palm Desert Financing Authority (the "Authority").
D. To finance and refinance redevelopment projects benefiting the Project
Areas, the Former Agency entered into the loan agreements listed in Attachment I
(collectively, the "Loan Agreements," each being a"Loan AgreemenY') with the Authority
and incurred loans thereunder (collectively, the "Agency Loans," with each being an
"Agency Loan").
E. To provide funding for the Agency Loans, the Authority issued the bonds
listed in Attachment I(collectively, the "Authority Bonds").
F. As of the date of this resolution, a portion of the principal amount of each
Agency Loan (and, correspondingly, an equivalent portion of the principal amount of
each series of the Authority Bonds) remains outstanding.
G. Pursuant to AB X1 26 (enacted in June 2011), and the State Supreme
Court's decision in California Redevelopment Association, et al. v. Ana Matosantos, et
al., 53 Cal. 4th 231 (2011), the Former Agency was dissolved as of February 1, 2012,
the Successor Agency of the Palm Desert Redevelopment Agency (the "Successor
Agency") was constituted, and the Oversight Board to the Successor Agency (the
"Oversight Board") was established.
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RESOLUTION NO. sa-xna o62
H. Pursuant to HSC Section 34177.5(a), the Successor Agency is authorized
to issue bonds (the "Refunding Bonds") to refund the Agency Loans, to provide savings
to the Successor Agency, provided that:
(i) the total interest cost to maturity on the Refunding Bonds plus the
principal amount of the Refunding Bonds shall not exceed the total
remaining interest cost to maturity on the refunded Agency Loans,
plus the remaining principal of the refunded Agency Loans; and
(ii) the principal amount of the Refunding Bonds shall not exceed the
amount required to defease the refunded Agency Loans, to
establish customary debt service reserves and pay related costs of
issuance.
I. The Successor Agency desires to issue Refunding Bonds to refund the
outstanding Agency Loans to achieve debt service savings.
J. The Refunding Bonds will be issued under the authority of HSC Section
34177.5 and Article 11 (commencing with Section 53580) of Chapter 3 of Part 1 of
Division 2 of Title 5 of the California Government Code (the "Refunding Bond Law").
K. The Board of Directors previously adopted Resolution No. SA-RDA-060,
on October 13, 2016 (the "SA Bond Approval Resolution"), approving the issuance of
the Refunding Bonds an Indenture (the "Indenture"), by and between the Successor
Agency and U.S. Bank National Association, as trustee, in substantially the form
attached to the SA Bond Approval Resolution.
L. Pursuant to HSC Sections 34177.5(� and 34180, the issuance of the
Refunding Bonds is subject to the Oversight Board's prior approval.
M. The Oversight Board adopted Resolution No. OB-154 on October 17,
2016 (the "Oversight Board Resolution"), approving the issuance of the Refunding
Bonds.
N. The State Department of Finance ("DOF") issued its letter, dated
December 1, 2016, providing the DOF's approval of the Oversight Board Resolution.
O. The Refunding Bonds will be issued in one or more series, and will consist
of a combination of tax-exempt bonds (the "Tax-Exempt Bonds") and taxable bonds (the
"Taxable Bonds").
NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE SUCCESSOR
AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY DOES HEREBY
RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
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RESOLUTION NO. SA-RDA 062
Section 1. Recitals. The above recitals, and each of them, are true and
correct.
Section 2. Refundina Bonds. This Board of Directors hereby confirms its
approval of the issuance of the Refunding Bonds in an aggregate principal amount not
to exceed $240,000,000 pursuant to the SA Bond Approval Resolution.
Section 3. Bond Purchase Contract. The sale of the Refunding Bonds
pursuant to a Bond Purchase Contract (the "Bond Purchase Contract"), by and
between the Successor Agency and Stifel, Nicolaus & Company, Incorporated ( the
"Underwriter") is hereby approved; rovided, that such sale shall be subject to the
following parameters: (i) the terms of the Refunding Bonds shall be in compliance
with the savings parameters set forth in clauses (A) and (B) of the Recital H of this
Resolution, (ii) the true interest cost of the Tax-Exempt Bonds shall not exceed 3.75
percent, (iii) the true interest cost of the Taxable Bonds not exceed 5.00 percent;
(iv) the Underwriter's compensation (i.e., underwriter's discount), exclusive of any
original issue discount, for the Refunding Bonds shall not exceed 0.5 percent of the
aggregate principal amount of the Refunding Bonds. The Bond Purchase Contract, in
the form on file with the Secretary of the Successor Agency, is hereby approved.
Subject to the parameters set forth above, each of the Chair of this Board, the Vice
Chair of this Board, the Executive Director and the Finance Officer of Successor
Agency (the "Authorized Officers," each an "Authorized Officer"), acting individually, is
authorized, for and in the name and on behalf of the Successor Agency, to execute
and deliver the Bond Purchase Contract, with changes therein as the Authorized
Officer executing the same may require or approve (such approval to be conclusively
evidenced by the execution and delivery thereof).
Section 4. Escrow Aareement. The Non-Housing Bonds Escrow Agreement
(the "Escrow Agreement") relating to the refunding and defeasance of the Agency
Loans and the Authority Bonds, substantially in the form on file in the office of the
Secretary of the Successor Agency, is hereby approved. Each Authorized Officer,
acting individually, is hereby authorized and directed, for and in the name and on
behalf of the Successor Agency, to execute and deliver the Escrow Agreement, in
substantially such form, with changes therein as the Authorized Officer executing the
same may require or approve (such approval to be conclusively evidenced by the
execution and delivery thereof).
Section 5. Preliminary Official Statement. The Preliminary Official Statement
(the "Preliminary Official Statement") relating to the Refunding Bonds, substantially in
the form on file in the office of the Secretary of the Successor Agency, is hereby
approved. Each Authorized Officer, acting individually, is hereby authorized and
directed, for and in the name and on behalf of the Successor Agency, to cause the
Preliminary Official Statement in substantially said form, with such additions or
changes therein as such Authorized Officer may approve, to be deemed final for the
purposes of Rule 15c2-12 promulgated under the Securities and Exchange Act of
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RESOLUTION NO. sA-xnA o62
1934, as amended (the "Rule"). The Underwriter is hereby authorized to distribute
copies of the Preliminary Official Statement to persons who may be interested in the
purchase of the Refunding Bonds.
Section 6. Official Statement. Each Authorized Officer, acting individually, is
hereby authorized and directed, for and in the name and on behalf of the Successor
Agency, to cause the Preliminary Official Statement to be brought into the form of a
final Official Statement and to execute the final Official Statement and such additional
documents prior to or concurrently with the signing of the final Official Statement as
such Authorized Officer may deem necessary or appropriate to verify the accuracy
thereof. The distribution and use of the Official Statement by the Underwriter in
connection with the sale of the Refunding Bonds are hereby approved.
Section 7. Continuing Disclosure Certificate. The Continuing Disclosure
Certificate (the "Continuing Disclosure Certificate") with respect to the Refunding
Bonds, substantially in the form attached as an appendix to the draft Preliminary
Official Statement on file in the office of the Successor Agency Secretary, is hereby
approved. Each Authorized Officer, acting individually, is hereby authorized and
directed, for and in the name and on behalf of the Successor Agency, to execute and
deliver the Continuing Disclosure Certificate in substantially such form, with changes
therein as the Authorized Officer executing the same may require or approve (such
approval to be conclusively evidenced by the execution and delivery thereof). The
appointment of Willdan Financial Services as the initial Dissemination Agent under the
Continuing Disclosure Certificate is hereby approved.
Section 8. Authorization to Proceed with Refunding in Part. In the event that
the Executive Director and the Financial Officer, in consultation with the Successor
Agency's municipal advisor, determine that a portion of the Agency Loans (the
"Uneconomic Portion") cannot be refunded concurrently with the other portion, because
refunding the Uneconomic Portion would not be in compliance with requirements of
Health and Safety Code Section 34177.5(a) and the parameters set forth herein, the
Executive Director is hereby authorized to direct the continuation of the refunding
transaction without the Uneconomic Portion. The Authorized Officers are authorized
to execute, on behalf and in the name of the Successor Agency, the Indenture and
each of the documents authorized hereby, with the applicable modifications to exclude
the Uneconomic Portion.
Section 9. Continuinq Disclosure Compliance Procedures. Reference is
hereby made to Resolution No. 2016-91 (the "City Resolution") adopted by the City
Council of the City on December 8, 2016, pursuant to which the Continuing Disclosure
Compliance Procedures (the "Continuing Disclosure Compliance Procedures") were
adopted. It is hereby affirmed that the Successor Agency adopts such Continuing
Disclosure Compliance Procedures. With respect to the Successor Agency's
continuing disclosure undertakings, each reference in the Continuing Disclosure
Compliance Procedures to the City, the City Manager and the Finance Director shall be
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RESOLUTION NO. sa-xDa o62
read as, respectively, the Successor Agency, the Successor Agency's Executive
Director and the Successor Agency's Finance Officer. The Executive Director,
consultation with bond counsel, is authorized to amend the Compliance Procedures
from time to time
Section 10. Tax-Advantaged Bonds Post-Issuance Compliance Procedures.
Reference is hereby made to the Tax-Advantaged Bonds Post-Issuance Compliance
Procedures (the "Post-Issuance Tax Compliance Procedures") also adopted pursuant
to the City Resolution. It is hereby affirmed that such Post-Issuance Tax Compliance
Procedures will be applicable to the Tax-Exempt Bonds. The Executive Director,
consultation with bond counsel, is authorized to amend the Post-Issuance Tax
Compliance Procedures from time to time.
Section 11. Other Acts. The members of this Board, the Chair, the Vice Chair,
the Executive Director, the Finance Officer and all other officers of the Successor
Agency, are hereby authorized, jointly and severally, to execute and deliver any and all
necessary documents and instruments and to do all things (including, but not limited to,
obtaining bond insurance or other types of credit enhancement, engagement of a
verification agent for the defeasance escrows) which they may deem necessary or
proper to effectuate the purposes of this Resolution. Any such previous action taken
by such officers are hereby ratified and confirmed.
APPROVED and ADOPTED this 8th day of December, 2016.
AYES: Jot�'reAx, KELLY, NESTANDE, i,IEBER, and HARNIR
NOES: xor�
ABESENT: xoxE
ABSTAIN: xorrE
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JA'�I C. HARNIK, CHAIR
ATTEST:
RA ELLE D. LASSE , SECRETAR
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
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RESOLUTION NO. SA-RDA 062
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RESOLUTION NO. SA-RDA 062
ATTACHMENT I
List of Loans to be Refunded
Loan
Project Incurred Related Authority Bonds Series
Area Year Loan A reement Desi nation
(1) 1 2002 Project Area No. 1, As Tax Allocation Refunding
� Amended, Loan Revenue Bonds (Project Area No.
Agreement, dated as of 1, As Amended) 2002 Series A
March 1, 2002
(2) 1 2003 Project Area No. 1, As Tax Allocation Revenue Bonds
Amended, Loan (Project Area No. 1, As Amended)
Agreement, dated as of Series 2003
Jul 1, 2003
(3) 1 2004 Project Area No. 1, As Tax Allocation Refunding
Amended, Loan Revenue Bonds (Project Area No.
� Agreement, dated as of 1, As Amended) 2004 Series A
June 1, 2004
(4) 1 2006 Project Area No. 1, As Tax Allocation Revenue Bonds
Amended, Loan (Project Area No. 1, As
Agreement, dated as of Amended), 2006 Series A
Jul 1, 2006
(5) 2 2002 Project Area No. 2 Loan Tax Allocation Refunding
Agreement, dated as of Revenue Bonds (Project Area No.
June 1, 2002 2, 2002 Series A
(6) 2 2003 Project Area No. 2 Loan Tax Allocation Revenue Bonds
Agreement, dated as of (Project Area No. 2), Series 2003
March 1, 2003
(7) 2 2006 Project Area No. 2 Loan Tax Allocation Refunding
(Series Agreement (2006 Senior Revenue Bonds (Project Area No.
2006A Loans), dated as of July 1, 2), 2006 Series A
Loan 2006
(8) 2 2006 Project Area No. 2 Loan Subordinate Tax Allocation
Agreement (2006 Revenue Capital Appreciation
Subordinate Loan}, dated Bonds (Project Area No. 2) 2006
as of Jul 1, 2006 Series D
(9) 3 2003 Project Area No. 3 Loan Tax Allocation Revenue Bonds
Agreement, dated as of (Project Area No. 3), Series 2003
Jul 1, 2003
(10) 3 2006 Project Area No. 3 Loan Tax Allocation Revenue Bonds
(Series Agreement (2006 Senior (Project Area No. 3) 2006 Series
2006A Loans), dated as of July 1, A;
Loan 2006
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RESOLUTION NO. SA-RDA 062
(11) 3 2006 Project Area No. 3 Loan Tax Allocation Revenue Capital
(Series Agreement (2006 Senior Appreciation Bonds (Project Area
2006B Loans), dated as of July 1, No. 3) 2006 Series B
Loan 2006
(12) 3 2006 Project Area No. 3 Loan Subordinate Tax Allocation
Agreement (2006 Revenue Capital Appreciation
Subordinate Loan), dated Bonds (Project Area No. 3) 2006
as of Jul 1, 2006 Series C
(13) 4 1998 Project Area No. 4 Loan Tax Allocation Revenue Bonds
Agreement, dated as of (Project Area No. 4), Series 1998
March 1, 1998
(14) 4 2001 Project Area No. 4 Loan Tax Allocation Revenue Bonds
Agreement, dated as of (Project Area No. 4), Series 2001
November 1, 2001
(15) 4 2006 Project Area No. 4 Loan Tax Allocation Refunding
(Series Agreement, dated as of Revenue Bonds (Project Area No.
2006A July 1, 2006 4) 2006 Series A
Loan
(16) 4 2006 Project Area No. 4 Loan Tax Allocation Revenue Capital
(Series Agreement, dated as of Appreciation Bonds (Project Area
20066 July 1, 2006 No. 4) 2006 Series B
Loan
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RESOLUTION NO. SA-RDA 062
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
2017 SERIES A
Druft fi�r Uiscussion Purposes Only
S�radling Yoccu Cur/son & Rauth
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAXABLE TAX ALLOCATION
REFUNDING BONDS
2017 SERIES B
�30ND PURCHASE CONTRACT
, 201
Successor Agency to the Palm Desert Redevelopment Agency
73510 Fred Waring Drive
Nalm Desert, California 92260
Attention: Gxecutive Uirector
Ladies and Gentlemen:
Stifel, Nicolaus & Company, lncorporated (the "Underwriter") offers to enter into this Bond
Yurchase Contract (this '`Purehase Contraet") with the Successor Agency to the Palm Desert
Redevelopment Agency (the "Agency"). 'I'his offer is made subject to the Agency's acceptance by
execution of this Purchase Contract and delivery of the same to the Underwriter on or before 11:59
p.m., California time, on the date hereof, and, if not so accepted, will be subject to withdrawal by thc
Underwriter upon notice delivered to the Agency at any time prior to such accepiance. Upon the
Agency's acceptance hereof, the Purchasc Contract will be binding upon the Agency and the
Underwriter. Capitalized tcrms that are used in this Purchase Contract and not otherwise defined
have the respective meanings given to such terms in the Indenture (as such term is defined herein).
Section 1. Purchase and Sale. Upon the terms and conditions and upon lhe basis of the
representations set forth in this Purchase Contract, the Underwriter agrees to purchase from lhe
Agency, and the Agency agrees to sell and deliver to the Underwriter, al) (but not less than all) of: (i)
the $ Successor Agency to the Palm Desert Redevelopment Agency Tax Allocation
Refunding Bonds 2017 Series A(the '`Series A Bonds") at a purchase price of $ (being an
amount cqual to thc principal amount of the Series A Bonds plus/lcss a net original issue
premium/discount of $ and less an Underwritcr's discount of $�; and (ii) the
$ Successor Agency to the Palm Desert Redevelopment Agency "I'axable 'I'ax
Allocation Refunding I3onds 2017 Series B(lhe '`Series B Bonds" and, together with the Scrics �1
Eionds, the "Bonds") at a purchasc price of $ (bcing an amount equal to the principal amount
of the Series L3 Bonds plus/less a net original issue premium/discount of $ and Iess an
Underwriter's discount or$_ _ �.
[The Agency acknowledges that the Underwriter will at Closing (as such term is defined
herein), on behalf of the Agcncy, wire a portion of the purchase price in the amounts of: (a) $
as the premium for the Policy (as such term is defined herein}; and (b) $ , as the premium }or
the Reserve Poficy (as such term is defined herein), directly to thc Insurer (as such term is defined
herein).]
RESOLUTION NO. SA-RDA 062
The obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds
shal) be conditioned on the sale and delivery of all of the Bonds by the Agency to the Underwriter at
Closing.
Section 2. Bond Terms; Authorizing Instruments.
(a) The Bonds shall be dated their date of delivery and shall mature and bear interest as
set forth on Exhibit A. The Bondti shal) be as described in, and shall be issued and secured under, an
Indenture (the "Indenture"), dated as of January 1, 2017, by and between the Agency and U.S. Bank
National Association, as trustee (the "Trustee"). The Bonds are payable and subject to redemption
as provided in the Indenture and as described in the Official Statement (as such term is detined
hcrein).
(b) The Bonds will be issued pursuant to Part l.8 (commencing with Section 34161) and
Part 1.85 of Division 24 (commencing with Section 34170) of the California Health and Safety Codc
and Article 11 (commencing with Section 53580) of Chapter 3 of Part 1 of Division 2 of Title 5 of
the Government Code of the State of California (collectively, the "Law"). The Bonds are payable
from and secured by the Agency's pledge of Tax Revenues undcr and as defined in the Indenture.
(c) The net proceeds of the sale of the Series A Bonds witl be used: (i) to refund the
2017A Prior Loans (as such term is defined in the Indenture); (ii) [to obtain a debt service reservc
insurance policy (the "Reserve Policy") issued by (the "Insurer") for deposit in the 2017A
Reserve Subaccount established under the Indenture; (iii) to obtain a municipal bond insurance
policy (the "Policy") issued by the Insurer insuring the payment of principal of and interest on thc
Series A Bonds]; and (iv) ro pay costs incurred in connection with the issuance of the Series A
Bonds.
(d) The net proceeds of the sale of the Series B Bonds will be used: (i) to refund thc
2017B Prior Loans (ds such term is defined in the Indenture); (ii) [to ob[ain a debt service reserve
insurance policy (the "Reserve Policy") issued by (the "Insurer") for deposit in the 2017B
Reserve Subaccount established under the Indenture; (iii) to obtain a municipal bond insurance
policy (the "Policy") issued by the Insurer insuring the payment of principal of and interest on the
Series B Bonds]; and (iv) to pay costs incurred in connection with the issuance of the Serics B
Bonds.
Section 3. Public Offering. The Underwriter agrees to make an initial bona fide public
offering of all of thc Bonds, at not in excess of the initial public offering yields or prices set forth on
Exhibit A. Following thc initial public offering of the Bonds, the offering prices may bc changed
from time to time by the Underwriter. The Agency acknowledges and agrees that: (a) the purchase
and sale of the Bonds pursuant to [his Purchase Contract is an arm's-length commercial transaction
between thc Agency and the Underwriter, and the only obligations that the Underwriter has to the
Agency wilh respect to the transaction contemplated hereby expressly are set forth in this Purchase
Contract; (b) in connection therewith and with the discussions, undertakings and procedures leading
up to [he consummation of such transaction, the Undcrwriter is and has been acting solely as a
principal and is not acting as a Municipal Advisor (as such term is defined in Section ISB of The
Securities Exchange Act oi 1934, as amended) to the Agency; (c) the Underwriter has not assumed
an advisory or fiduciary responsibility in favor of the Agency with respect to the offering
contemplated hereby or thc discussions, undertakings and procedures leading thereto (irrespective of
whether the Underwriter has provided other services or i� currently providing other services to the
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RESOLUTION NO. SA-RDA 062
Agency on other matters); (d} the Underwriter has financial and other interests that may differ 1�rom
and be adverse to those of the Agency; and (e) the Agency has consulted its own legal, financial,
accounting, tax and other advisors to the extent that it has deemed appropriate.
Section 4. Ofticial Statement; Continuing Disclosure.
(a) The Agency has delivered to the Underwriter the Pretiminary Official Statement
datcd _, 201_ (the "Preliminary Official Statement") and will deliver to the Underwriter
the final Official Statement dated the date of this Purchase Contract (as amended and supplemented
from time to time pursuant to Section 5(i) of this Purchase Contract, the "Official Statement")
within seven business days.
(b) The Agency authorizes the use of the Off►cial Statement and the information
contained therein by the Underwriter in connection with the pub►ic offering and the sale of the
Bonds. The Agency consents to the use by the Undecwriter prior to the date hereof of the
Preliminary Official Statement in connection with the public offering of the Bonds. Thc Underwritcr
agrees that i[ will not send any confirmation requesting payment for the purchase of any Bonds
unless the confirmation is accompanied by or preceded by the delivery of a copy of the Official
Statement. The Underwriter agrees: (i) to provide the Agency with fnal pricing information on the
Bonds on a timely basis prior to the Closing; and (ii) to take any and all other actions necessary to
comply with applicable rules of the Securities and Exchange Commission (the "SEC"} and the
Municipal Securities Rulemaking Board (the "M5RB") governing the offering, sale and delivery of
the Bonds to ultimate purchasers.
(c) In connection with the issuance of the Bonds, and in order to assist the Underwriter in
complying with the provisions of SEC Rule 15c2-12 ("Rule 15c2-12"), the Agency will enter into a
Continuing Disclosure Agreement (thc "Continuing Disclosure Undertaking") dated the date of the
Closing, under which the Agency wifl undertake to provide certain financial and operating data as
reyuired by Rule 15c2-12. The form of the Continuing Disclosure Undertaking is attached as an
appendix to the Preliminary Official Statement.
Section 5. Representations, Warranties and Covenants of the Agency. The Agency
hereby represents, warrants and agrees with the Underwriter that:
(a) Thc Board of Directors (the "Board") of thc Agency has taken official action by vne
or more resolutions (collectivcly, the "Agency Resolution") adopted by a majority of the members
of the Board at regular mcetings that were duly called, noticed and conducted, at which a quorum
was present and acting throughout, authorizing the execution, delivery and due performance of: (i)
the Indenture; (ii) the Continuing Disclosure Undertaking; (iii) the Non-Housing Bonds Escrow
Agremeent, dated as of January I, 2017 (the "Escrow Agreement"), by and among the Agency, the
Palm Desert Financing Authority (the "Authority") and U.S. Bank National Association, as escrow
agent (the "Escrow Agent"), related to the obligations that arc listed in Appendices A and B of thc
(ndenture; and (iv) this Purchase Contract (collectively, the "Agency Agreements") and the Official
Statement, and the taking of any and all such action as may be required on the part of the Agency to
carry out, give effect to and consummate the transactions that are contemplated hereby.
(b) The Agency is a redevelapment successor agency that is duly organized and existing
under the laws of the State of California (the "State") and has all necessary power and authority to
adopt [he Agency Reso{ution and to enter into and pert�orm its duties undcr the Agcncy Agreements.
RESOLUTION NO. SA-RDA 062
(c) By all necessary official action, the Agency hes: (i) duly authorized the preparation
and delivery of the Preliminary Official Statement and the preparation, execution and delivery of [he
Official Statement; (ii) duly authorized and approved the execution and delivery of, and the
performance of its obligations under, the Bonds and the Agency Agrecments; and (iii) duly
authorir_ed the consummation by the Agency of all other transactions contemplated by the Agency
Resolution, the Agency Agreements, the Preliminary Official Statement and the Official Statement.
When executed and delivered, the Agency Agreements (assuming due authorization, execution and
delivery by and enforceability against the other parties thereto) will be in full force and effect and
each will constitute legal, valid and binding agreements or obligations of the Agency, enforceable in
accordance with their respective terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws or equitable principles relating to or limiting
creditors' rights generally, the application of equitable principles, the exercise of judicia( discretion
and the limitations on legal remedies against public entities in the State.
(d) At the time of the Agency's acceptance hereof and at all times subsequent thereto up
to and including the time of the Closing, the information and statements in the Uft`icial Statement do
not and will not contain any untrue statement of a material fact or omit to state a material fact that is
required to be stated thcrein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (except that no representation is made
with respect to information relating to DTC (as such term is dcfined herein), DTC's book-entry
system)[, the Policy, the Reserve Policy or the Insurer]).
(e) As of the date hereof, except as described in the Preliminary Official Statement, there
is no action, suit, proceeding or investigation before or by any court, public board or body that is
pending against, and notice of which has been served on and received by, the Agency, or, to the best
knowledge of the Agency, threatencd, wherein an unfavorable decision, ruling or finding would: (i)
affect the crcation, organization, existence or powers of the Agency, or the titles of its members or
officers; (ii) in any way question or affect the validity or enforceability of the Agency Agreements,
the Bonds or the exclusion of the interest on the Series A Bonds from fedcral taxation or of the
interest on the Bonds from State taxation; or (iii) in any way question or affect the Purchase Contract
or the transactions contemplated by the Purchase Contract, the Official Statement, or any other
agreement or instrument ro which the Agency is a party relating to the Bonds.
(� There is no consent, approval, authorization or other order of, filing or registration
with, or certitication by, any regulatory authority that has jurisdiction over the Agency thal is
required for the execution and delivery of this Purchase Contract and the other Agency Agreements
or the consummation by the Agency of the other transactions that are contemplated by the Official
Statement or the Agency Agrcement�.
(g) Any cerliticate that is signed by any official of the Agency who is au[horized to do so
shall be deemed a representation and warranty by the Agency ro the Underwriter as to the statements
made therein.
(h) The Agency is not in default, and at no time hati the Agency defaulted in any material
respect, on any bond, note or other obligation for borrowed money or any agreement under which
any such obiigation is or was outstanding.
(i) If any event occurs of which the Agency has knowledge between the date of this
Purchase Contract and the date of the Closing that might or would cause the Ofticial Statement, as
�
RESOLUTION NO. SA-RDA 062
then supplemented or amended, to contain an untrue statement of a material fact or to omit to state a
material fact that is required to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, the Agency will notify the
Underwriter and if, in the opinion of the Underwriter, such event reyuires the preparation and
publication of a supplement or amendment to the Official Statement, the Agency will cooperate with
the Underwriter in causing the Official Statement to be amended or supplemented in a form and in a
manner that is approved by the Underwriter. Ali expenses that are thereby incurred will be paid by
the Agency, and the Underwriter will file, or cause to be filed, the amended or supplemented Official
Statement with the MSRB's Electronic Municipal Market Access database ("EMMA").
(j) The Agency will i'urnish such information, execute such instruments and take such
other action in cooperation with the Underwriter as the Undcrwriter may reasonably request in order:
(i) to qualify the Bonds for offer dnd sale under the Blue Sky or other securities laws and regulations
of such sta[es and other jurisdictions of the United States as the Underwriter may designaee; and (ii)
to dctermine the eligibility of the Bonds for investment under the laws of such states and other
jurisdictions. The Agency will not be required to execute a general or special consent to service of
process or to qualify to do business in connection with any such yualification or determination in any
jurisdiction.
(k) The Agency is not in any material respect in breach of or default under: (i) any
applicable constitutional provision, law or administrative regulation of any state or of the United
States, or any agency or instrumentality of either; (ii) any applicabte judgment or decree; or (iii) any
loan agreement, indenture, trust agreement, bond, note, resolution, agreement or other instrument to
which the Agency is a party, which breach or default has or may have an adverse effect on the ability
of the Agency to perform its obligations under the Agency Agreements, and no event has occurred
and i� continuing which with the passage of time or the giving of notice, or both, would constitute
such a default or event of default under any such instrument; and the adoption, execution and
delivery of the Agency Agreements, if applicable, and compliance with the provisions on the
Agency's part contained therein, will not conflict in any material way with or constitute a material
brcach of or a material default under any constitutionat provision, law, administrative regulation,
judgment, decree, loan agreement, indenture, trust agreement, bond, note, resolution, agreement or
other instrument to which the Agency is a party, nor will any such execution, delivery, adoptian or
rompliance result in the creation or imposition of any licn, charge or other security interest or
encumbrance of any nature whatsoever upon any of the property or assets of the Agency or under thc
term� of any such law, regulation or instrument, except as may be provided by the Agency
Agreements.
(I) Except as set forth in the Official Statement under thc caption ("CONTINUING
DISCLOSURE,J" the Agency has complied in all material respects with its continuing disclosure
undertakings in thc past five years.
(m) The financial statements relating to the receipts, expenditures and cash balances of
the Agency as of June 30, 201 [5] attached as an appendix to the Official Statement fairly represent
the receipts, expenditures and cash balances of the Agency as of such date. Except as disclosed in
the Official Statement or otherwise disclosed in writing to the Underwriter, there has not been any
materially adverse change in the financial condition of the Agency or in its operations since June 30,
201 [5] and there has been no occurrence, circumstance or combination thereof that is reasonably
expected to result in any such materially adverse change.
5
RESOLUTION NO. SA-RDA 062
(n) The Agency will refrain from taking any action, or permitting any action to be taken,
with regard to which the Agency may exercise control, that results in the loss of the tax-exempt
status of the interest on the Series A Bonds under federal law or of the interest on the Bonds under
State law.
Section 6. The Closing.
(a) At 8:00 A_M., California time, on _, 2017, or on such earlier or later
time or date as may be agreed upon by [he Underwriter and the Agency (the "Closing"), the Agency
shall deliver, or cause to be delivered, to the Trustee the Bonds in definitive form, registered in the
name of Cedc & Co., as the nominee of The Depository Trust Company, New York, IVew York
("DTC") (so that the Bonds may be authenticated by the Trustee and credited ro the account that is
specitied by the Underwriter under DTC's FAST procedures). Prior to the Closing, the Agency shall
deliver, at the offices of Richards, Watson & Gershon, A Professional Corporation ("Bond
Counsel") in Los Angeles, California, or at such other place as is mutually agreed upon by the
Underwriter and the Agency, the other documents that are described in this Purchase Contract. On
thc date of the Closing, the Underwriter shail pay the purchase price of the Bonds as set forth in
Section 1 of this Purchase Contract in immediately available funds to the order of the Trustee.
(b) The Bonds shatl be issucd in fully rcgistered form and shali be prepared and delivered
as one Bond for each maturity registered in the name of a nominee of DTC. It is anticipated that
CUSIP identitication numbers will be inserted on the Bonds, but neithcr the failure to provide such
numbers nor any error with respect thereto shall constitute a cause for failure or refusal by the
Underwriter to accept delivery of the Bonds in accordance with the terms of this Purchase Contract.
Section 7. Conditions to Underwriter's Obligations. The Underwriter has entered
into this Purchase Contract in reliance upon the representations and warranties of the Agcncy
contained herein and to be contained in the documents and instrumcnts to be delivered on the date of
the Closing, and upon the performance by the Agency of its obligations to be performed hereunder
and under such documcnts and instruments to be delivered at or prior to the date of the Closing. Thc
Underwriter's obligations under this Purchase Contract are and shall also be subject to the following
conditions:
(a) The representations and warranties of the Agency that are contained in this Purchase
Contract shall be true and correct in all material respects on the date of this Purchase Contrac[ and on
and as of thc date of the Closing as if made on the date of the Closing.
(b) As of the date of the Closing, the Official Statement shall not have b�en amendcd,
modified or supplemented, except in any case as may have been agreed ro by the Underwriter.
(c) (i) As of' the date of the Closing, the Agency Resolution and the Agency Agreements
shall be in full force and effect, and shall not have been �mended, modified or supp(emented, except
as may have been agreed to by the Agency and the Underwriter; and (ii) the Agency shall perform or
shall have performed all of its obligations that are required under or specified in the Agency
Resolution and the Agency Agreements to be performed at or prior to the date of the Closing.
(d) As of Ihe date of the Closing, all necessary official action of the Agency relating to
the Agency Agreements, the Agency Resolution and the Official Statement shall bc in fult forcc and
effect and shall not have been amcndcd, modificd or supplemented in any material respect.
0
RESOLUTION NO. SA-RDA 062
(e) Subsequent to the date of this Purchase Contract, up to and including the date of the
Closing, there shall not have occurred any change in the financial affairs of the Agency, as described
in the Offcial Statement, which in the rcasonablc professional judgment of the Underwriter
materially impairs the investment quality of the Bonds.
(t) Ati of or prior to the date of the Closing, the Underwriter shall havc receivcd each of
the following document�:
(A) Certified copies of the Agency Resolution.
(B) Duly executed copies of the Agency Agreements.
(C) The Preliminary Official Statement and the Official Statement, with the
Official Statement duly executed on behalf of the Agency.
(D) An approving opinion of Bond Counsel, dated the date of the Closing, as to
the validity of the Bonds and the exclusion of interest on the Series A Bonds from federal taxation
and of interest on the Bonds from State income taxation, addressed to the Agency, substantially in
the form attached as an appendix to the Official Statement, and a reliance letter with respect therero
addressed to the Underwriter.
(E) A supplemental opinion or opinions of Bond Counscl, dated the date of the
Closing, addressed to the Underwriter, to the effect that:
( I) The Purchase Contract has been duly executed and delivered by the
Agency and (assuming due authorization, execution and delivery by and enforceability against thc
Underwriter) is valid and binding upon the Agency, subject to laws relating to bankruptcy,
insolvency, reorganization or creditors' rights generally and to the application of equitable principles;
(2) The Bonds are exempt from registration pursuant to the Sccurities Act
of 1933, as amended, and the Indenture i� exempt from qualification pursuant to the Trust Indenture
Act of 1939, as amended;
(3) The statements containcd in the Official Statement on the cover and
under the captions ["INTRODUCTIO[V," "REFUNDING PLAN," "THE BONDS" (excluding
therefrom the statements pertaining to DTC), "SECURITY �OR THE BONDS" and "TAX
MATTERS," and in Appendices A and BJ, excluding any material that may be treated as included
under such captions by cross-reference, insofar as such statcments expressly summariac cenain
provisions of the Bonds, [he Agency Agreements and the form and content of Bond Counsel's fiinal
approving opinion, are accurate in all material respects; and
(4) The obligations that are listed in Appendices A and B of the Indenture
have been defeased in accordance with the provisions of the instruments pursuant to which they were
issued.
(F) An oQinion of the Agency's Genecal Counsel, dated the date of the Closing,
addressed to the Agency and thc Underwritcr, substantially in the form attached hereto as Exhibit D.
(G) An executcd Rule 15c2-12 certificate of the Agency, dated the c�ate of the
Prcliminary Official Statement, substantially in the form attached hereto as Exhibit B.
7
RESOLUTION NO. SA-RDA 062
(N) An executed closing certiticate of the Agency, dated the date of the Closing,
substantially in the form attached hereto as Exhibit C.
(I) The opinion of counsel to the Trustee, addressed to the Agency and thc
Underwriter, substantially to the effect thar.
(1) The Trustee is a nation�l banking association that is duly organized,
validly existing and in good standing under the laws of the United States of America, having full
powers and authority and being qualified to enter into, accept and administer the trust created under
the Indenture and to enter into thc Indenture; and
(2) The Indenturc has been duly authorized, executec! and delivered by
the Trustee, and, astiuming due authorization, execution and delivery by the Agency, the Indenwre
constitutes thc legal, valid and binding agreements of the Trustee, enforceable in accordance with its
terms, subject to laws relating in bankruptcy, insolvency or other laws affecting the enforcement of
creditors' rights generally and the application of equitable principles if equitable remedies are sought.
(J) The opinion or opinions of counsel to the Escrow Agent, addressed ro the
Agency and the Underwriter, substantially to the effect that:
( I) The Escrow Agent is a national banking association that is duly
organized, validly existing and in good standing under the laws of the United State� of America,
having full powers and authority and being qualified to enter into, accept and administer the trust
created under the Escrow Agreement and to enter into the Escrow Agreement; and
(2) The Escrow Agreement has been duly authorized, executed and
delivered by the Escrow Agent and, assuming due authorization, execution and delivery by the
Agency, the Escrow Agreement constitutes the legal, valid and binding agreements of the Escrow
Agenl, enforceable in accordance with its terms, subject to laws relating in bankruptcy, insolvency or
other laws affecting the enforcement of creditors' rights gec►erally and the application of equitable
principles if equitable remedies are sought.
(K) A certificate, dated the date of the Closing, in form and substance acceptablc
to the Underwriter and Bond Counsel, of an authorized officer of officers of the "Trutitee to the effect
that the Trustee is duly authorized to enter into the Indenture, has accepted the duties imposed by the
Indcnture and is authorized to carry out such duties, and that the Trustee has duly authenticated the
Bonds.
(L) A certificate or certificates, dated the date of the Closing, in form and
substance acceptable to the Underwriter and Bond Counsel, of an authorized officer of officers of the
Escrow Agent to the effect that the Escrow Agent is duly authorized to enter into the Escrow
Agreement, has accepted the duties imposed by the Escrow Agreement and is authorized to carry out
such duties.
(M) A certificate, dated the date of the Closing, in form and substance acceptable
to the Underwriter and Bond Countiel, of an authorized officer of officers of the Authority to the
effect that: (1) the Authority is duly authorized to enter into the Escrow Agrcement; (2) the Escrow
Agreement (assuming due execution and delivery by the othcr parties thercto) constitutes the valid
and binding obligation of the Authority; and (3) the execution and delivery of the Escrow Agreement
RESOLUTION NO. SA-RDA 062
and compliance with the provisions thereof will not conflict with or constitute a breach of or default
under any applicable law, decision, administrative rule or regulation of the State of California, the
United States, any department, division, agency or instrumentality of either thereof or any applicable
court, or under any instrument to which the Authority is a party or is otherwise subject or bound in a
manner that would materially adversely affect the Authority's performance thereundcr.
(N) Evidence of required filings with the California Debt and Investment
Advisory Commission.
(0) A copy of the executed Blanket Issuer Letter of Representations by and
between the Agency and DTC relating to the book-entry system.
(P) An exccuted verification report relating to the obligations that are listed in
Appendices A and B of the Indenture, among other matters.
(Q) Evidence that the ratings that have been assigned to the Bonds as of the date
of the Closing are as set forth in the Official Statement.
(R) A certified copy of the general resolution of the Trustee authorizing the
execution and delivery of certain documents by certain officers of the Trustee, which resolution
authorizes the execution and delivery of the Indenture and the authentication and delivery of the
Bonds by the Trustee.
(S) A certified copy of the general resolution of the Escrow Agent authorizing thc
execution and delivery of certain documents by certain officers of the Escrow Agent, which
resolution authorizes the execution and delivery of the Escrow Agreement.
(T) An opinion of Stradling Yocca Carlson & Rauth, a Professional Corporation,
counsel to the Underwriter, addressed to the Underwriter and in form and substance satisfactory to
thc Underwriter.
(U) A report of Lumesis as to compliance by the Agency and related entities with
their respective continuing disclosure undertakings.
(V) A Tax Certificate with respect to maintaining the tax-exempt stat�s of the
Serics A Bonds, duly executed by the Agency, together with Form 80:i8-G, duly executed by thc
Agency.
(W) An letter of Best Best & Krieger LLP, as Disclosure Counsel, to the effect
that, based upon an examination that they have madc, and without having undertaken to determine
independently or assuming any responsibility for the accuracy or completeness or fairness of the
statements contained in the Official S[atement, as a matter of fac[ and not opinion, such counsel
advises that, in its capacity as Disclosure Counsel, no facts came to the attention of the attorneys in
such firm rendering legal services in connection with such representation that caused such counsel to
believe that the Official Statement as of its date and as of the Closing (except for: ( l) the expressions
of opinion, the assumptions, the projections, the financiat statements, or other financial, numerical,
economic, demographic or statistical data contained in the Official Statement; (2) any CUSIP
numbers or information relating [hereto; (3) any information wi[h respeCt to DTC and DTC's book-
entry system; (and (4) any information with respect to the Policy, the Reserve Policy and the
0
RESOLUTION NO. SA-RDA 062
Insurer]) contained or contains any untrue statement of a ma[eria) fact or omitted or omits to state any
material fact necessary to make the statements therein, in light of the circumstances under which thcy
were made, not misleading.
(X) A letter from the State Department of Finance approving the issuance of the
Bonds.
(Y) A certitied copy of the resolution of thc Agency's Oversight Board approving
the issuance of the Bonds.
(Z) A certificate of Keyser, Marston & Associates, the Agency's fiscal
consultant, relating to the information provided by such party in the Official Statement, in form and
substance �atisfactory to the Underwriter and Bond Counsel.
(AA) [ADD CERTIFICATION BY OTHER PARTY TO CDA, AS NEEDED]
(BB) (Evidence satisfactory to the Underwriter of the issuance of the Policy and the
Reservc Policy by the lnsurer.
(CC) Evidence satisfactory to the Underwriter that the Trustee shall have rcceived
the Reserve Poliey from the Insurer, which Reserve Policy constiwtes a Qualified Reserve Account
Credit Instrument under and as detined in the Indenture.
(DD) An opinion of counsel to the Insurer, in form and substancc satisfactory to the
Underwriter and Bond Counsel, with respect to, among otfier matters, the Policy and the Reserve
Policy, and disclosures relating thereto and to the Insurer in the Official Statement.
(EE) A certi�cate of the Insurer, in form and substance satisfactory to the
Underwriter and Bond Counsel, with respect to, among othcr matters, the Policy and the Reserve
Policy.�
(FF) Such additional legal opinions, certiftcates, proceeding�, instruments and
other documents as the Underwriter or Bond Counsel may reasonably request to evidence
compliance by the Agency with legal requirements, the truth and accuracy, as of the date of the
Closing, of the representations of the Agency contained herein and of the Official Statement and the
due performance or satisfaction by the Agency at or prior to such time of all agreements then to be
performed and all conditions then to be satisfied by the A�ency.
All of the opinions, letters, certificates, instruments and other documents that are mentioned
in this Purchase Contraet shall be deemed to be in compliance with the provisions of this Purchase
Contract if, but only if, they are in form and substance satisfactory to the Underwriter. If the Agency
is unable to satisfy the conditions to the obligations of the Underwriter to purchase, to accept delivery
nf and to pay for the Bands as set forth in this Purchase Contract, or if the obligations of thc
Underwriter to purchase, to accept delivery of and to pay for the Bonds shall be terminated for any
reason permitted by this Purchase Contract, this Purchase Contract shall terminate and neither the
Underwritec nor the Agency shall be under any further obligations hereunder, except that the
respc:ctive obligations of the Agency and the Underwriter that are set forth in Section 11 of this
Purchase Contract shall continue in full force and effect.
�
RESOLUTION NO. SA-RDA 062
Section 8. Conditions to Agency's Obligations. The performance by the Agcncy of it,
obligations undcr this Purchase Contract is conditioned upon: (i) the performance by the Underwritcr
of its obligations hereunder; and (ii) receipt by the Agency of opinions addressed to thc Agency,
receipt by the Underwriter of opinions addressed to the Underwriter and the delivery of certif7cates
on the date of the Closing by persons and entities other than the Agency.
Section 9. Termination Events. The Underwriter shall have the right to terminate the
Underwriter's obligations under this Purchase Contract to purchase, accept delivery of and pay for
the Bonds by notifying the Agency of its election to do so if, after the execution hereof and prior to
the Closing, any of the following events occurs:
(a) the marketability of the Bonds or the market price thereof, in the reasonable
opinion of the Underwriter, has been materially and adversely affected by any decision that is issued
by a court of the United States (including the United States Tax Court) or of the State, by any ruling
or regulation (final, temporary or proposed) that is issued by or on behalf of the Department of the
Treasury of the United States, the Internal Revenue Service, or other governmental agency of the
United States, or any governmental agency of the State, or by a tentative decision or announcement
by any member of the House Ways and Means Committee, the Senate Finance Cammittee, or the
Conference Committec with respect to contemplated legislation or by legislation enacted by, pendin�
in, or favorably reported to either the House of Representativcs or either House of the Lcgislature of
the State, or formally proposed to the Congress of the United States by the President of the United
States or to the Legislature of the State by the Governor of the State in an executive communication,
affecting the tax status of the Agency or the City of Palm Desert, their property or income, their debt
or contractual obligations (including the Bonds) or the interest thereon or any tax exemption granted
or authorized by the Interna! Revenue Code of 1986, as amended;
(b) the United States becomes engaged in hostilities that result in a declar�tion of
war or a national emergency, or any other outbreak of hostilities occurs, or a local, national or
international calamiry or crisis occurs, financial or otherwise, the effect of such outbreak, calamity or
crisis being such as, in the reasonable opinion of the Underwriter, would affect materially anJ
adversely the ability of the Underwriter to market the Bonds;
(c) there occurs a general suspension of trading on the New York St�ck
Exchange or the declaration of a general banking moratorium by the United States, New York or
State authoritics;
(d) a stop ordcr, ruling, regulation or official statement by, or on behaif of, the
SEC is issued or made to the effect that the issuance, offering or sale of the Bonds or obligations
similar to the Bond� is or would be in violation of any provision of the Securities Act of 1933, as
then in effec[, the Securities Exchange Act of 1934, as then in effect, or the Trust Indenture Act of
1939, as then in effcct;
(e) legislation is enacted by the House of Representatives or the Senate of the
Congress of the United States of America, a decision by a court of the United States of America is
rendered or a ruling or regulation by or on behalf of the SEC or other governmental agency having
jurisdiction of the subject matter is made or proposed to the effect that the Bonds are not exempt
from registration, qualification or other similar requirements of the Securities Act of 1933, as then in
effect, or of the Trust Indenture Act �f 1939, as then in effect;
�
RESOLUTION NO. SA-RDA 062
(fl in the reasonable judgment of the Underwriter, the market price of the Bonds,
or the market price of obligations of the general character of the Bonds, might be materially and
adversely aff�cted because additionat material restrictions that are not in force as of the date hereof
are imposed upon trading in securities generally by any governmental authority or by any national
securities exchange;
(g) the Office of the Comptroller of the Currency, The New York Stock
Exchange, or other national securities exchange, or any governmental authority, imposes, as to the
Bonds or obligations of the general character of the Bonds, any material restrictions not now in force,
or increases materially those now in force, with respect to the extension of credit by, or the charge to
the net capital requirements of, or financial responsibility requirements of the Underwriter,
(h) a general banking moratorium is established by federal, New York or Statc
authoritics;
(i) any legislation, ordinance, rule or regulation is in[rodnced in or enacted by
any governmental body, department or agency in the State or a decision of a court of competent
jurisdiction within the State is rendered, which, in the reasonable opinion of the Underwriter, after
consultation with the Agency, materially adversely affects the market price of the Bonds;
(j) any federal or State court, authority or regulatory body takes action that
materialty and adversely affects the collection of revenues that arc pledged under the Indenture;
(k) any rating of the Bonds or the Insurer is downgraded, suspended, withdrawn
or placed on credit watch or similar status by a national rating service, which, in the reasonable
opinion of the Underwriter, materially adversely affects the marketability or market price of the
Bonds;
(I) an event occurs which in the reasonablc opinion of the Underwriter requires a
supptement or amendment to the Official Statement and: (i) the Agency refuses to prepare and
furnish such supplement or amendment; or (ii) in the reasonable judgment of the Underwriter, the
occurrence of such event materially and adversely affects the marketability of the Bonds or renders
the enforcement of the sale contracts of the Bonds impracticable;
(m) an order, decree or injunction ihat is issued by any court of competent
jurisdiction, or order, ruling, regulation (tinal, temporary or prop�sed), official statement or other
form of notice or communication that is issued or made by or on behalf of the SEC, or any other
governmental authority having jurisdic[ion of the subjec[ ma[ter, to the effect that: (i) obligations of
the general character oF the Bonds, or the Bonds, including any or all underlying drrangements, are
not exempt from registration under thc Securities Act of 1933, as amended, or that the Indenture is
not cxempt from qualitication under the Tru�t Indenture Act of 1939, as amended; or (ii) the
issuance, offering or sale of obligations of the general ch�racter of the Bonds, or the issuancc,
offering or sale of the Bonds, including any or all underlying obligations, as contemplated hereby or
by the OFticial Statement, is or would be in violation of the federal securities laws as amended and
then in effect;
(n) additional material restrictions that are not in force as of the date hereof shall
have t►een imposed upon trading in securities generally by any domestic governmental authority or
12
RESOLUTION NO. SA-RDA 062
by any domestic national securities exchange, which are material to the marketability of the Bonds;
or
(o) the commencement of any action, suit or proceeding described in Section
5(e).
Section 10. Changes in Official Statement. After the Closing, the Agency will not
adopt any amendment of or supplement to the Official Statement to which the Underwriter shall
reasonably object in writing. Within 9Q days after the Closing or within 25 days following the "end
of the underwriting period" (as such term is defined below), whichever occurs first, if any event
relating to or affecting the Bonds, the Trustee or the Agency occurti as a result of which it is
necessary, in the opinion of the Underwriter, to amend or supplement the Official Statement in order
to make the Official Statement not misleading in any material respect in the light of thc
circumstances existing at the time tha[ it is delivered to a purchaser, the Agency will forthwith
prepare and furnish to the Underwriter an amendment or supplement that wili amend or supplement
the Official Statement so that it will not contain an untrue titatement of a material fact or omit to st�te
a material fact necessary in order to make the statements therein, in the light af the circumstances
existing at the time that the Official Statement is delivered to a purchaser, not misleading. The
Agcncy will cooperate with the Underwriter in the filing by the Underwriter of such amendment or
supplement to the Ofticial Statement with the MSRB. As used herein, the term "end of the
underwriting period" means the later of such time as: (i) the Agency dclivers the Bonds to thc
Underwriter; or (ii) the Underwritcr does not retain, directly or as a member of an underwriting
syndicate, an unsold balance of the Bonds for sale to the public. Notwithstanding the foregoing,
unless the Underwriter gives notice to the contrary, the "end of the underwriting period" will be the
date of the Closing. Any notice that is delivered pursuam to this provision will be written notice
delivered to the Agency at or prior to the date of the Closing and will specify a date (other than [he
date of the Closing) to be deemed the "end of the underwriting period."
Section I1. Payment of Expenses.
(a) The Underwriter shall be under no obligation to pay, and the Agency shall pay the
following expenses incident to the performance of the Agency's obligations hercunder:
(i) the fees and disbursements of Bond Counsel;
(ii) the cost of printing and delivering the B�nds, the Preliminary Official
Statement and the Of(icial Statement (and any ameadment or supplement that is prepared pursuant to
Section 10 of this Purchase Contract);
(iii) the fees and disbursements of accountants, advisors and any other expert� or
consultants retained by the Agency, including the Agency's general counsel; and
(iv) any other expenses and costs of the Agency that are incident to the
performance of its obligations in connection with the authorization, issuance and sale of the Bonds,
including out-of-pocket expenses and regulatory expenses, reimburtiement to the Underwriter for any
meals and trave{ for Agency employees or officers that were paid for by the Underwriter, costs
relating to the issuance of the Policy and the Reserve Policy and any other expenses agreed to by the
parties.
13
RESOLUTION NO. SA-RDA 062
(b) The Underwriter shall pay all expenses incurred by it in connection with the public
offering and distribution of the Bonds including, but not limited to:
(i) all advertising expenses in connection with the offering of the Bonds; and
(ii) all out-of-pocket disbursements and expenses incurred by the Underwriter in
connection with the offering and distribution of the Bonds (including, without limitation, the fees and
expcnses of its counsel and MSRB, CUSIP Bureau, California Debt and Investment Advisory
Commission and California Public Securities Association fees, if any), except as provided in clause
(a) above or as otherwise agreed to by the Underwriter and the Agency.
Section 12. Notices. Any notice or other communication to be given to the Agency under
this Purchase Contract may be given by delivering the same in writing to the Agency at the address
that is tiet forth on the first page of this Purchase Contract, and any notice or other communicetion to
be given to the Underwriter under this Purchase Contract may be given by delivering the same in
writing to:
Stifcl, Nicolaus & Company, Incorporated
One Montgomery Street, 35th Floor
San Francisco, California 94104
Attention: Jim Cervanteti
Section 13. Survival of Representations, Warranties, Agreements. All of the
Agcncy's representations, warranties and agreements that are contained in this Purchase Contract
shall remain operative and in full force and effect regardless of: (a) any investigations made by or on
behalf of [he Underwriter; or (b) delivery of and payment for the Bonds pursuant to this Purchase
Contract. The agreements contained in this Section and in Section 1 1 shall survive the termination of
this Purchasc Contract.
Section 14. Benefit; No Assignment. This Purchase Contract is made solely for the
benefit of the Agency and the Underwriter (including thcir successors and assigns), and no othcr
person shall acquire or have any right hereunder or by virtue hercof. The rights and obligations
created by this Purchase Contract are not subject to assignment by the Underwriter or the Agency
without the prior written consent of the other parties hereto.
Section 15. Severability. In the event that any provision of this Purchase Contract is held
to be invalid or unenforccable by any court of competent jurisdiction, such holding shall not
invalidate or render unenforceable any other provision of this Purchase Contract.
Section 16. Counterparts. This Purchase Contract may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and any of the parties hereto
may execute the Purchase Contract by signing any such counterpart.
Section 17. Governing Law. This Purchase Contract shall be governed by the laws of
the State.
[REMAII�IDER OF PAGE INTENTIONALLY LEFT BLANK)
14
RESOLUTION NO. SA-RDA 062
Section 18. Effectiveness. This Purchase Contract shall become effective upon the
execution of the acceptance hereof by an authorized officer of the Agency, and shall be valid and
enforceable as of the time of such acceptance.
Very truly yours,
STIFEL, NICOLAUS & COMPANY,
INCORPORATED
B y:
Title: Authorized Officer
Accepted:
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
By:
Title: Executive Director
Timc of Execution: California Timc
�
RESOLUTION NO. SA-RDA 062
EXHIBIT A
MATURITY SCHEDULE
Principal
Payment Date
(October 1)
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
2017 SERIES A
Principal
$
Coupon
c��.
Yield
* Tenn Bond.
``' Priced te� tirst optional redemption date of _ I, 20_ at par.
A-1
�Ic
Price
RESOLUTION NO. SA-RDA 062
Principal
Payment Date
(October I)
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAXABLE TAX ALLOCATION
REFUNDING BONDS
2017 SERIES B
Principal
$
Coupo�:
�1�
Yield
* Tcrm Bond.
�`' Priced to first optional rcdcmption datc of
1. 20_ at par.
9�
Price
A-2
RESOLUTION NO. SA-RDA 062
EXHIBIT B
RU[,E 15c2-12 CERTIFICATE
$ *
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDIN(� BONDS
2017 SERIES A
$ *
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAXABGE TAX ALLOCATION
REFUNDING BONDS
2017 SERIES B
The undersigned hereby certifics and represents that the undersigned is the duly appointed
and acting representative of the Succestior Agency to the Patm Desert Redevelopment Agency (the
"Agency"), and as such is duly authorized to execute and deliver thiti Certificate on behalf of the
Agency, and further hereby certifies and reconfirms on behalf of the Agency as follows:
(1) This Certiticate is delivered in connection with the offering and sale of the above
captioned bonds (the "Bonds") in order to enable the underwriter of the Bonds to comply with
Securities and Exchange Commission Rule 15c2-12 promulgated under the Securities Exchange Act
of 1934 (the "Rule").
(2) 1n connection with ihe offering and sale of the Bonds, there has been prepared a
Preliminary Official Statement, setting forth information concerning the Bonds and the Agency (the
"Preliminary Oflicial Statement").
(3) As used herein, "Permitted Omissions" means the offering price(s), interest rate(s),
selling compensation, aggregate principal amount, principal amount per maturity, delivery dates,
ratings and other tcrms of the Bonds depending on such matters, ail with respect to the Bonds.
(4) The Preliminary Official Statement is, except for the Permit[ed Omissions, deemed
tinal within the meaning of the Rule, and the information therein is accurate and complete except for
the Permitted Omissions.
Datcd: _, 20 i _
* Preli�ninar�': .tuhjecl ►u rl�urtge.
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
BY=
Titic: Executive Dircctor
I:�I
RESOLUTION NO. SA-RDA 062
EXHIBIT C
CLOSING CERTIFICATE OF THE AGENCY
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
2017 SERIES A
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAXABLE TAX ALLOCATION
RFFUNDING BONDS
2017 SERIES B
The undersigned hereby certifies and represents that the undersigned is the duly appointed
and acting representative of the Successor Agency to the Palm Desert Redevelopment Agency (the
"Agency"), and is duly authorized to execute and deliver this Certificate and further hereby certities
and reconfirms on behalf of the Agency as followl:
(i) The represe�tations, warranties and covenants of the Agency that are
contained in the Bond Purchase Contract, dated _, 201_ (the "Purrhase Contract"), by and
between the Agency and Stifel, Nicolaus & Company, Incorporated, as underwriter, are true and
correct and in all material respects on and as of the date of the Closing, with thc same effect as if
made on the date of the Closing.
(ii) The Agency Resolution is in fufl force and effect at the date of the Closing
and has not been amended, moditied or supplemented, except as agreed to by the Agency and the
Underwriter.
(iii) The Agency has complied with all of the agreements and satisCed all of the
conditionti on its part to be performed or satisfied on or prior co the date of the Closing.
(iv) The statements and descriptions in the Ofticial Statement that pertain to the
Agency do not contain any untrue or misleading statement of a material fact and do not omit to statc
any material fact necessary to make the statements therein, in the light of the circumstances under
which they are made, n�[ misleading.
Capitalized terms used but not dellned hercin have the meanings given to such terms in thc
Purchase Contract.
Dated: _, 20l
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
By:
Title: Executivc Director
C-1
RESOLUTION NO. SA-RDA 062
EXHIBIT D
OPINION OF GENERAL COUNSEL
_, 201 _
Succetisor Agency to the Stifet, Nicolaus & Company, Incorporated
Palm Desert Redevelopment Agency One Montgomery Street, :i5th Floor
735 [0 Fred Waring Drive San Francisco. California 94104
Palm De�crt, California 92260
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
2017 SERIES A
$
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAXABLE TAX ALLOCATION
REFUNDING BONDS
2017 SFRIES B
Ladies and Gentlemen:
In my capacity as the General Counsel to the Succestior Agency to the Palm Desert
Redevelopment Agency (the "Agency"), in connection with the issuance by the Agency of the
above-referenced bonds (the "Bonds"), I have examined such documents, certificates and records as
I have deemed relevant and necessary as the basis for the opinion set forth herein. Capitalized terms
that are used and not otherwise defined herein have the same meanings as assigned to them in the
Bond Purchase Contract, dated _, 201_ (the "Purchase Contract"), by and between Stifel,
Nicolaus & Company, Incorporated, as undcrwri[er, and the Agency.
Relying on my examination described above and pertinent law and subject to the limitations
and qualifications set forth hereinafter, 1 am of the following opinion:
l. The Agency is a rcdevelopment successor agency that is duty organized and existing
under the laws of the State of California, and has all necessary powcr and authority to adopt the
Agency Resolution and to enter into and perform its duties under the Agency Agreements.
2. Resolution Nos. and of the Agency (collec[ively, the "Agency
Resolution") have been duly adopted at meetings of the Board of Directors of the Agency that were
du(y called and held on October 13, 2016 and _, 201_ pursuant to law, with all reyuired
public notice and at which a quorum was present and acting throughout. The Agency Resolution is
in full force and effect and has not been amended or repcaled.
3. The Agency has duly authorized, executed and delivered the Agency Agreements.
Assuming due authorization, execution and delivery by the other parties thereto, as necessary, the
Agency Agreements constitute legal, valid and binding agreements of the Agency enforceable
[�i
RESOLUTION NO. SA-RDA 062
against the Agency in accordance with their terms, except as the enforceability thereof may be
limited by applicable bankruptcy, insolvency, debt adjustment, fraudulent conveyance or transfer,
moratorium, reorganization or other laws affecting the enforcement of creditors' rights generally and
equitable remedies if equitable remedies are sought, to the exercise of judicial discretion in
appropriate cases and limitations on remedies against public agencies.
4. Except as disclosed in the Official Statement, there is no action, suit or proceeding
before or by any court, public board or body pending (with service of process having been
accomplished on the Agency) or, to the best of my knowledgc, threatencd wherein an unfavorable
decision, ruling or finding would: (a) affect the creation, organization, existence or powers of the
Agency or the titles of its ofticers [o their respective offices; (b) in any way question or affect the
validity or enforceability of the Agency Agreements or the Bonds; (c) render illegal, invalid or
unenforceable the Agency Agrcements or the transactions contemplated [hereby, or any other
agreement or instrument rclated to the issuance of the Bonds to which the Agency is a party; or
(d) have a material adverse effect on the ability of the Agency to make payments of principal of and
interest on the $onds when due.
5. The execution and delivery of the Agency Agreements and compliance with the
provisions of each thereof will no[ conflict with or constitute a breach of or default under �►ny
applicable law or administrative rule or regulation of the State of California, the United States or any
department, division, agency or instrumentality of either thereof, any applicable court or
administrative decrce or order or any loan agreement, note, resolution, indenture, trust agreemcnt,
contract, agreement or other instrument to which the Agency is a party or is otherwise subject or
bound in a manner that would materially adverseiy affect the Agency's performance under the
Agency Agreements.
The opinion is based on such examination of the laws of the State of California as I have
deemed relevant for the purposes of this opinion. I have not considered the effect, if any, of the laws
of any other jurisdiction upon matters covered by this opinion. [ have assumed the genuineness of all
documents and signatures, presented to me. I have not undertaken to verify independently, and havc
assumed, the accuracy of the factual matters represented, warranted or certified in such documents. I
express no opinion as to the status of the Bondti, the interest thereon or the Agency Agreements
under any federal securities laws or any state securities or "Blue Sky" law or any federal, state or
local tax law. Without limiting any of the foregoing, 1 express no opinion as to any matter other than
as expressiy set iorth above.
I am furnishing this opinion as General Counsel to the Agency. Except for the Agency, no
attorney-client relationship has existed or exists betwecn me and the addressees hereof in connection
with the Bonds or by virtue of this opinion. This opinion is rendered solely in connection with the
tinancing described herein, and may not be relied upon by you for any other purpose. I disclaim any
obligation to update this opinion. This opinion shall not extend to, and may not bc used, quoted,
rcferrzd to, or relied upon by any other person, firm, corporation or other entity without my prior
written consent.
Respectfully submitted,
D-2
RESOLUTION NO. SA-RDA 062
NON-HOUSING BONDS ESCROW AGREEMENT
by and among
PALM DESERT FINANCING AUTHORITY,
SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY
and
U.S. BANK NATIONAL ASSOCIATION,
as Trustee and Escrow Agent
Dated as of January I, 2017
Relating to Defeasance of:
Various Series of
Palm Desert Financing Authority
Tax Allocation Revenue Bonds and Tax Allocation Refunding Revenue Bonds
as described herein
(and corresponding prepayment of loans under Loan Agreements,
by and among the Authority, the former Palm Desert Rcdevelopment Agency
and the trustce thereunder)
I?813-UW3U�1535r4.doc RWG DRAFT: 11/28/2016
RESOLUTION NO. SA-RDA 062
TABI,E OF CONTENTS
PaQe
Section 1.
Section 2.
Section 3.
Section 4.
Section 5.
Section 6.
Section 7.
Section 8.
Section 9.
Section 10.
Section 1 l.
Section 12.
Section 13.
Section 14.
Section I5.
Section 16.
Section 17.
Section 1 S.
Section 19.
Section 20.
Section 21.
Section 22.
Sectioa 23.
Section 24.
Definitions............................................................................................................2
Escrow Agent's Acceptance of Duties .................................................................4
[ncorgoration of Prior Indentures .........................................................................4
Escrow Funds Deposits .........................................................................................4
Maintenance of Escrow Funds .............................................................................. 5
Payment of Refunding Requirements ................................................................... 6
Verification. ..........-• .............................................................................................. 6
Compliance with Prior Indentures and this Agreement ........................................ 6
TaxCovenant ........................................................................................................6
Defeasance and Redemption Notices . .................................................................. 7
Defeasance of Refunded Bonds ............................................................................7
Dischargeof Prior Loans ......................................................................................7
Natureof Lien .......................................................................................................7
Amendments......................................................................................................... 7
Compensation of Escrow Agent . .......................................................................... S
Resignation or Removai of Escrow Agent; Appointment of Successor ............... 8
Limitation of Powers and Duties . .........................................................................9
Indemnification................................................................................................... 10
Limitationof Liability ........................................................................................ 10
Closing of Escrow Funds; Termination of Agreement ....................................... 1 l
GoverningLaw . .................................................................................................. 11
Severability. ........................................................................................................ 1 1
Successor Deemed Included in References to Predecessors .............................. 11
Counterparts........................................................................................................ 1 I
Appendix A— List of 2017A Prior Bonds
Appendix B— List of 2017B Prior Bonds
Appendix C — Refunding Requirements
Appendix D — Escrow Securities
Appendix E— Form of Defeasance Notice
I ?81 Z-OW3� 1991535v4.doc
RESOLUTION NO. SA-RDA 062
NON-HOUSING BONDS ESCROW AGREEMENT
This Non-Housing Bonds Escrow Agreement (this "Agreement"), dated as of January 1,
2017, is by and among the Palm Desert Financing Authority, a joint exercise of powers agency
duly organized and existing pursuant to the laws of the State of California (the "Authority"), the
Successor Agency to the Palm Desert Redevelopment Agency, a pablic entity existing under �he
laws of the State of Catifornia (the "City"), and U.S. Bank Na[ionai Association, a national
banking association duly organized and existing under the laws of the United States of America,
as successor trustee under the Prior Indentures and Prior Loan Agreements described below and
escrow agent hereunder (the "Escrow Agent").
RECITALS:
A. The former Palm Desert Redevelopment Agency (the "Former Agency") was a
duly constituted redevelopment agency pursuant to provisions of the Community Redevelopment
Law set forth in Section 33000 et seq. of the Health and Safety Code ("HSC") of the Sta[e of
California (thc "State").
B. The Former Agency undertook a program to redevelop four project areas (thc
"Projcct Areas").
C. The Former Agency and the City of Palm Desert (the "City") executed and
delivered a Joint Exercise of Powers Agreement, dated as of January 26, 1989 (the "Joint Powers
Agreement"), which Joint Powers Agreement created and established the Authority.
D. To finance and refinance redevelopment projects benefiting the Project Areas, the
Former Agency entered into multiple loan agreements including, among others: (i) those
idcntified in Appendix A(the "2017A Prior Loan Agreements") with the Authority and incurred
loans thereunder (the "2017A Prior Loans"), and (ii) those identified in Appendix B(the "2017B
Prior Agreements" and, together with the 20 ( 7A Prior Loan Agreements, the "Prior Loan
Agreements") with the Authority and incurred loans thereunder (the "2Q 17B Prior Loans" and,
together with the 2017A Prior Loans, the "Prior Loans").
E. To provide funding for the 2017A Prior Loans and the 2017B Prior Loans, the
Authority issued: (i) the bonds (the "2017A Prior Bonds") pursuant to the Inden[ures of Trust
(the "2017A Prior Indentureti") identified in Appendix A and (ii) the bonds (the "2017B Prior
Bonds" and, together with the 2017A Prior Bonds, the "Prior Bonds") pursuant to the Indentures
of Trust (the "2017B Prior lndentures" and, together with the 2017A Prior indentures, the "Prior
Indentures") identificd in Appendix B.
F. Pursuant to the Prior Indentures, the Prior Bonds are secured by "Revenues,"
consisting of amounts repaid by the Former Agency (as succeeded by the Successor Agency")
for the Prior Loans.
G. Pursuant to AB X l 26 (enacted in June 2011), and the State Supreme Court's
decision in Califnrnia Redevelopment Association, et al. v. Ana Mutvsantos, et al., 53 Cal. 4th
231 (2011), the Former Agency was dissolved as of February 1, 2012, the Successor Agency was
constituted.
12812-00()3t 1991535v4.doc
RESOLUTION NO. SA-RDA 062
H. Thc Successor Agency has determined to issue its Tax Allocation Refunding
Bonds, 2017 Series A, in the aggregate principal amount of $ (the "2017A Bonds"),
pursuant to an Indenture, dated as of January l, 2017 (the "2017 Indenture"), by and between the
Successor Agency and U.S. Bank National Association, as trustee.
I. The 2017A Bonds are being issued to effect a refunding of all of the outstanding
2017A Prior Bonds and the concurrent discharge of the 2017A Prior Loans.
J. The Successor Agency has determined to issue its Taxable Tax Allocation
Refunding Bonds, 2017 Series B, in the aggregate principal amount of $ (the "2017B
Bonds" and, together with the 2017A Bonds, the "2Q17 Bonds"), pursuant to the 2017 Indenture.
K. The 2017B Bonds are being issued to effect a refunding of all of the outstanding
2017B Prior Bonds and the concurrent discharge of the 2017B Prior Loans.
L_ Pursuant to the 2017 Indenture and this Agreement, the Successor Agency will
also cause to be transferred to the Escrow Agent, a portion of the sale proceeds of 2017 Bonds,
together with other moneys, for the deposit into the escrow funds (the "Escrow Funds") to be
established under this Agreement, to effect the defeasance of the outstanding Prior Bond� (and
the concurrent discharge of the Prior Loans).
M. Pursuant, and subjecl, to the terms of the Prior Indentures, if there has been
deposited with the Escrow Agent, to be held in escrow, cash or qua(ified securities (or a
combination thereo� which shall provide sufficient moneys to pay and redeem any portion of the
outstanding Prior Bonds through maturity or a designated redemption date, then the Authority's
obligations with respect to such Prior Bonds shall be discharged and the lien with respect to such
Prior Bonds under the Prior Indentures shall cease (except for the payment thereof from the
moneys held in escrow by the Escrow Agent) and such Prior Bonds shall be defeased.
N. The Authority and the Successor Agency are entering into this Agreement in
order to provide for the proper and timely application of the proceeds from the 2017 Bonds and
other moneys toward the defeasance and the payment and redemption of the Prior Bonds.
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
Section 1. Definitions. (a) Unlesti the context otherwise indicates, words
expressed in the singular shall include the plural and vice versa. Unless the context clearly
requires otherwise, capitalized terms used in this Agreement shall have the meanings ascribed to
them in the introductory paragraph and the Recitals hereof. In addition, as used herein, the
following terms shall have the following meanings:
"2002 PA 1 Escrow
Account," "2002 PA2 Escro
Account" mean, respectively,
Fund pursuant to Section 4.
I ?81 Z-OW 311991$35v4 duc
Account," "2003 PA 1 Escrow Account," "2004 PA 1 Escrow
w Account," "2003 PA2 Escrow Account" and "1998 PA4 Escrow
the account by such names established within the 2017A Escrow
:
RESOLUTION NO. SA-RDA 062
"2006A PA 1 Escrow Account," "2003 PA2 Escrow Account," "2006A PA2 Escrow
Account," "2006D PA2 Escrow Account," "2003 PA3 Escrow Account," "2006A PA3 Escrow
Account," "2006B PA3 Escrow Account," "2006C PA3 Escrow Account," "2001 PA4 Escrow
Account," "2006A PA4 Escrow Account" and "2006B PA4 Escrow Account" mean,
respectivcly, the account by such names established within the 2017B Escrow Fund pursuant to
Section 4.
"2017A Escrow Fund" means the fund by that name established by the Escrow Agent
pursuant to Section 4.
"2017B Escrow Fund" means the fund by that name etitablished by the Escrow Agent
pursuant to Section 4.
"Bond Counsel" means Richards, Watson & Gershon, A Professional Corporation, or
such other attorney or firm of attorneys of nationally recognized experience in the issuance of
obligations the interest on which is excludable from gross income for federal income tax
purposes under the Code selected by the Authority and the Successor Agency.
"Closing Date" means January _, 2017, the date on which the 2017 Bonds are beinc
issued.
"Code" means the Internal Revenuc Code of 1986, as amended.
"Escrow Accounts" means, collectively, the accounts within the Escrow Funds.
"Escrow Funds" means, together, the 2017A Escrow Fund and the 2017B Escrow Fund.
"Escrow Securities" means the lnvestment Securities to be deposited in the each Escrow
Account established within the Escrow Funds, as described in Appendix D.
"Investment Securities" meanti noncallable direct obligations of the United S[ates of
America, or bonds or other ob(igations which are noncallable and the payment of principal and
interest of which are unconditionally and fully guaranteed by the United States of America, to
mature or bc withdrawable, as thc case may be, not later than the time when needed for the
payment and redemption of the Refunded Bonds in ordcr to discharge the pledge and lien
securing the Refunded Bonds.
"Redemption Date" means: (i) with respect to the Refunded PA2 Bonds, February I,
2017, and (ii) with respect to all other Refunded Bonds, April 1, 2017.
"Refunded Bonds" means the remaining unpaid Prior Bonds to be defeased, paid and
redeemed, pursuant to this Agreement, as further described in Appendix C.
"Refundcd PA2 Bonds" means the portion of the Prior Bonds related to "Project Area 2"
(as idcntified in Appendices A and B) to be defeased, paid and redeemed, pursuant to this
Agreement.
B-3
12R1?-OUO3\1991SiSrd.duc
RESOLUTION NO. SA-RDA 062
"Refunding Requirement" means, with respect to Refunded Bonds of each series
designation, an amount sufficient to pay the principal, interest and the redemption premium (if
any) with respect to such Refunded Bonds on the applicable Redemption Date as set forth in
A�pendix C.
Section 2. Escrow Agent's Acceptance of Duties. The Escrow Agent hereby accepts
the duties and obligations expressly provided in this Agreement and agrees that the irrevocable
instructions to the Eserow Agent contained herein are in a form satisfactory to it.
Section 3. Incor�oration of Prior Indentures. The applicable and necessary
provisions of the Prior Indentures, including redemption provisions and defeasance provisions
set forth therein, are incorporated herein by reference.
Section 4. Escrow Funds Deposits.
(a) There is hereby created and established with the Escrow Agent, a special
and irrevocuble trust fund designated the "2017A Escrow Fund," to be held by the Escrow Agent
separate and apart from a[1 other funds of the Authority, the Successor Agency or the Escrow
Agent and used oniy for the puiposes and in the manner provided in this Agreement. Within the
2017A Escrow Fund, the Escrow Agent shall establish the separate accounts and make the
deposits set forth below on the Closing Date:
(A) (B) (C) (D) (E) (F)
Release from
Release from Reserve Toial
Revenue Fund held Deposit into
Related Prior Deposit from Fund held under Account on
Bonds Proceeds of under related Prior Closing Date
(as defined in 2017 A related Prior Loan (Columns C
Account designation Appendix A) Bonds Indenture Agreement + D+ E)
2W2 PA ( Escrow Account 2002 PA l Bonds
2003 PA l Escrow Account 2003 PA 1 Bonds
2W4 PAl Escrow Account 2W4 PA1 Bonds
2002 PA2 Escrow Account 2002 PA2 Bonds
2003 PA2 Escrow Account 2003 PA2 Bonds*
1998 PA4 Escrow Account 1998 PA4 Bonds
* Consisting of a portion of each mawrity of the 2(H)2 PA2 Bonds: (i) $169,4U0 of the principal maturing on
August l, 2023, (ii) $176,176 of thc principal maturing on August 1, 2024, (iii) $481,096 of' the principal
maturin� on August 1, 2026, and (iv) $2,221,560 of the principal maturing on August l, 20:�3.
B-4
128 I 2-(H )03\ 19915 35 v4. doc
RESOLUTION NO. SA-RDA 062
(b) There is hereby created and established with the Escrow Agent, a special
and irrevocable trust fund designated the "2017B Escrow Fund," to be held by thc Escrow Agent
separate and apart from all other funds of the Authority, the Successor Agency or the Escrow
Agent and used only for the purposes and in the manner provided in this Agreement. Within the
2017B Escrow Fund, the Escrow Agent shall establish the separate accounts and make the
deposits set forth below on the Closing Date:
�A� (1�) (C) (D) (E) (F)
Release from
Release irom Reserve Total
Revenue Fund held Deposit into
Related Prior Deposit from Fund held under Account on
Bonds Proceeds of under related Prior Closing Date
(as deCned in 2017B related Prior Loan (Columns C
Account designation Appendix B) Bonds Indenture Agreement + D+ E)
2006 PA 1 Escrow Account 2006 PA I Bonds
200� PA2 Escrow Account 2003 PA2 Bonds*
20U6A PA2 Escruw Account 2(H)6A PA2 Bonds
2006D PA2 Escrow Account 2006D PA2 Bonds
2003 PA:� Escrow Accuun� 2003 PA3 Bunds
2006A PA3 Escrow Account 2006A PA3 Bonds
2(x)6B PA:� Escrow Account 2Q06B PA3 Bonds
200bC PA3 Escrow Account 2O06C PA3 Bonds
2(x)I PA4 Escrow Account 2UOl PA4 Bonds
2006A pA4 Escrc�w Acrount 2Q06A PA4 Bonds
2006V pA4 Escruw Account 2006B PA4 Bonds
* Ccinsisting of a portion of each mawrity of thc 2002 PA2 Bonds: (i) $7(?5,600 of thc principal maturing on
Au�ust I, 2023, (ii) 5733,824 of thc principal maturing on August 1, 2024, (iii) $2,003,904 of the principal
maWring on Au�ust I, 2026, and (iv) $9,253,440 of thc principal maturing on August I, 2033.
(c) Each Escrow Account constitutes a special and irrevocable trus� fund for
purposes of effecting the concurrent defeasance of the related Refunded Bondti and the discharge
of the relatcd Prior Loan.
Section 5. Maintenance of Escrow Funds.
(a) The Escrow Agent, upon receipt of the moneys described in Section 4
shall immediately invest the moneys in each Escrow Account as described in Appendix D. All
proceeds received upon the maturity of the Escrow Securities, including interest earnings
thereon, shall be retained in the related Escrow Account. The Escrow Agent is hereby
authorized and empowered to deposit uninvested monies held hereunder from time to time in a
demand deposit account, without payment of interest thereon as provided hereunder, established
at commercial bdnks that are corporate affiliates of the Escrow Agent.
(b) Notwithstanding the foregoing or any other provision of this Agreement to
the contrary, at the written reyuest of the Successor Agency and upon compliance with the
B-5
1281 �-(xN)3\ I'� I 535 v4.do�
RESOLUTION NO. SA-RDA 062
conditions hereinafter set forth, the Escrow Agent shall have the power to sell, transfer, request
the redemption of or otherwise dispose of some or all of the Escrow Securities in each Escrow
Account and to substitute Inves[ment Securities. The foregoing may be effected anly if: (i) the
substitution of investment Securities for the substituted Escrow Securities occurs simultaneously;
(ii) the amounts of and dates on which the anticipated moneys from such Escrow Account to be
available for the payment or redemption of the related Refunded Bonds on each payment or
redemption date identified in Appendix C will not be diminished or postponed thereby, as shown
in the ceRification (described below) of an independent certified public accountant; {iii) the
Escrow Agent shall receive the unqualified opinion of counsel to the effect that the Successor
Agency has the right and power to effect such disposition and substitution; and (iv) the Escrow
Agent shall receive from an independent certified public accountant a certification that,
immediately after such transaction, the principal of and interest on the Investment Securities in
such Escrow Account will, together with other moneys available for such purpose, be sufficient
to pay the related Refunding Requirement. Any cash received from the disposition and
substitution of Escrow Securities pursuant to this Section to the extent that, as shown in such
certitication, such cash will not be required, in accordance with the 2017 [ndenture and this
Agreement, at any time for the payment when due as provided in Section 6, shall be transferred
to the Successor Agency.
Section 6. Pavment of Refunding Reyuirements. On each payment or redemption
date identified in Appendix C, the EScrow Agent shall disburse the amount indicated on
Appendix C for application toward the payment or redemption of the related Refunded Bonds,
for the equal and ratable benefit of the owners of the related Refunded Bonds; provided, that if
such payment or redemption date falls on a Saturday or Sunday, then the actual disbursement
may be made on the foliowing business day..
Section 7. Verification. The Successor Agency has caused schedules to be prepared
relating to the suffieiency of the funds deposited in the Escrow Funds to pay the Refunding
Requirements. The Succetitior Agency shall furnish the Escrow Agent with the report of Grant
Thornton, LLP, verifying the mathematical accuracy of the computations contained in such
schedules.
Section 8. Co �liance with Prior Indentures and this Agreement. The Escrow Agent
hereby agrees that the Escrow Agent will take all the actions required to be taken by it hereunder,
including the timely transfer of moneys for the payment of principal, interest and redemption
premium (if any) with respect to the Refunded Bonds, in order to effectuate this Agreement. The
liability of the Escrow Agent far the payment of the Refunding Requirements, pursuant to this
Section and under the Prior Indentures, shall be limi[ed to the application, in accordance with
this Agreement, of moneys in the Escrow Funds (including the Escrow Securities and interest
earnings thereon, if any) available for the purposes of and in accordance with this Agreement.
Section 9. Tax Covenant. Notwithstanding any other provision of this Agreement,
the Authority and the Successor Agency hereby covenant that no pact of the proceeds of 2017A
Bonds or of the moneys or funds held by the Escrow Agent hereunder shall be used, and that the
Authority and the Successor Agency shall not direct the Escrow Agent to use any of such
moneys or funds at any time, directly or indirectly, in a manner that would cause any of the
2017A Bonds to be an "arbitrage bond" under Section 148 of the Code and the regulations of the
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RESOLUTION NO. SA-RDA 062
Treasury Dcpaztment thereunder proposed or in effect at the time of such use and applicable to
obiigations issued on the date of execution and dclivery of the 2017A Bonds. None of the
Authority, the Successor Agency nor the Escrow Agent shall transfer or oiherwise dispose of
moneys and securities held in the 2017A Escrow Fund except as set forth in this Agreement;
provided that the Escrow Agent may effectuate the transfer of such moneys to a successor
Escrow Agent in accordance with the provisions of Section 16 relating to the transfer of rights
and property to successor Escrow Agents.
Section 10. Defeasance and Redemption Notices. As soon as practicable upon the
Escrow Agent's receipt of moneys for deposit in the Escrow Funds pursuant to Section 4, the
E�crow Agent shall send notices of defeasance to the registered owners of the Refunded Bonds
and each bond insurer of the Refunded Bonds (as indentified in the Prior Indentures),
substantially in the form set forth in Appendix E. No later than the 30 days (but not more than
60 days) before each Redemption Date, the E�crow Agent shall also send notices of redemption
for the applicable Refunded Bonds in accordance with the Indentures, with copies to the
applicable bond insurers; provided, that it is recognized that for the Refunded PA2 Bonds (which
have a Redemption Date of February 1, 2017), a notice of redemption was sent before the
execution and delivery of this Agreement.
Section 1 l. Defeasance of Refunded Bonds. Concurrently with the deposit of the
moneys in the Escrow Funds pursuant to Section 4 of this Agreement, the Refunded Bonds shall
no longer be deemed to be "Outstanding" and unpaid within the meaning and with the effect
expressed in the Prior lndentures.
Section l2. Discharge of Prior Loans. Concurrently with the deposit of the moneys in
the Escrow Funds pursuant to Section 4 of this Agreement, the Prior Loans shall be deemed
discharged pursuant to the terns of the Prior Loan Agreements.
Section l3. Nature of Lien. The trusts hereby created shall be irrevocable. The
owners of the Refunded Bonds shall have an express lien on all of the moneys (including any
securities) in the Escrow Account relating to the Refunded Bonds owned by such owners,
including the earnings thereon, until paid out, used and applied in accordance with this
Agreement.
Section 14. Amendments. This Agreement shall not be repealed, revoked, altered,
amended without the written consent of all of the registered owncrs of the unpaid Refunded
Bonds and the written consent of the Escrow Agent, the Successor Agency and the Authority;
provided, however, that the Authority, the Successor Agency and the Escrow Agent may,
without the consent of or notice to, such registered owners, enter into such amendment to this
Agreement, if such amendment shall not materially adversely affect the rights of sueh registered
owners and shall not be inconsistent with the terms and provisions of this Agreement, for any
one or more of the following purposes:
(a) To cure any ambiguity or formal defect or omission in this Agreement;
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RESOLUTION NO. SA-RDA 062
(b) To grant to, or confer upon, the Escrow Agent for the benefit of the
owners of the Refunded Bonds, any additional rights, remedies, powers or authority that may
lawfully be granted to, or conferred upon, such owners or the Escrow Agent;
(c) To transfer to the Escrow Agent and make subject to this Agreement,
additional funds securities or properties;
(d) To conform the Agreement to the provisions of any law or regulations
governing the tax-exempt status of the Prior Bonds, as applicable, and the 2017A Bonds in order
to maintain their tax-exempt status; and
(e) To make any other change determined by the Successor Agency to be not
materially adverse to the owners of the Refunded Bonds.
The Escrow Agent shall be entitled to rely exclusively upon an opinion of Bond Counsel
with respect to compliance with this Section, including the extent, if any, ro which any change,
modification or addition affects the rights of the owners of the Refunded Bonds, or that any
instrument executed hereunder complies with the conditions and provisions of this Section.
Section 15. Compensation of Escrow Agent. In consideration of the services rendered
by the Escrow Agent under this Agreement, the Successor Agency agrees to and shall pay to the
Escrow Agent its proper fees and expenses in accordance with the agreement therefor reached by
the Escrow Agent and the Successor Agency, including ali reasonable expenses, charges, counsel
fees and other disbursements incurred by it or by its attorneys, agents and employees in and
about the performance of their powers and duties hereunder, from any moneys of the Successor
Agency and the Authority lawfully available therefor and the Escrow Agent shall have no lien
whatsoever upon any of the moneys in the Escrow Funds (including any securities therein) for
the payment of such proper fees and expenses.
Section 16. Resig,nation or Removal of Escrow Agent; Appointment of Successor.
The Escrow Agent at the time acting hereunder may at any time resign and be discharged from
the trusts hereby created by giving written notice to the Authority and the Successor Agency
specifying the date when such resignation will take effect, but no such resignation shall take
effect unless a successor Escrow Agent shall have been appointed by the owners of the Refunded
Bonds or by the Successor Agency as hereinafter provided and such successor Eserow Agent
shall have accepted such appointment, in which event such resignation shall take effect
immediately upon the appointment and acceptance of a successor Escrow Agent.
The Escrow Agent may be removed at any time by an instrument or concurrent
instruments in writing, delivered to the Authority and the Successor Agency and signed by the
registered owners of a majority in principal amount of the Refunded Bonds. The Escrow Agent
may also be removed at any time by the Authority and the Successor Agency with not less than
30 days' written notice to the Escrow Agent and the registcred owners of the Refunded Bonds.
In the event the Escrow Agent hereunder shall resign or be removed, or be dissolved, or
shall be in the course of dissolution or liquidation, or otherwise become incapable of acting
hereunder, or in case the Escrow Agent shall be taken under the control of any public officer or
officers, or a receiver appointed by a court, a successor Escrow Agent may be appointed by the
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RESOLUTION NO. SA-RDA 062
owners of a majority in principal amount of the Refunded Bonds, by an instrument or concurrent
instruments in writing, signed by such owners, or by their attorneys in fact duly authoriced in
writing; provided, nevcrtheless, that in any such event, the Successor Agency shall appoint a
temporary Escrow Agent to fill such vacancy until a successor Escrow Agent shall be appointed
by the owners of a majority in principal amount of the Refunded Bonds, and any such temporary
Escrow Agent so appointed by the Successor Agency shall immediately, and without further act,
he superseded by the Escrow Agent so appointed by such owners.
In the event that no appointment of a successor Escrow Agent, or a temporary successor
Escrow Agent, shall have been made by such owners or the Authority, pursuant to the foregoing
provisions of this Section, within 30 days after written notice of the removal or resignation of the
Escrow Agent has been given to the Authority and the Succetisor Agency, the owner of any of
the Refunded Bonds, or any retiring Escrow Agent may apply to any court of competent
jurisdiction for the appointment of a successor Escrow Agent, and such court may thereupon,
after such notice, if any, as it shall deem proper, appoint a successor Escrow Agent.
No successor Escrow Agent shall be appointed unless such successor Escrow Agent shall
be a national banking association or a corporation with trust powers organized under the banking
(aws of the United States or any state, and shall have at the time of appointment capital and
tiurplus of not less than $75>000,000.
Every successor Escrow Agent appointed hereunder shall execute, acknowledge and
deliver to its predecessor and to the Authority and the Successor Agency, an instrument in
writing accepting such appointment hereunder and thereupon such successor Escrow Agenl
without any further act, deed or conveyance, shall become fully vested with all the rights,
immunities, powers, trusts, duties and obligations of its predecessor; but such predecessor shall,
nevertheless, on the written rcquest of such successor Escrow A�ent, the Authority ar the
Successor Agency, execute and deliver an instrument transferring to tiuch successor Escrow
Agent all the estates, properties, rights, powers and trusts of such predecessor hereunder; and
every predecessor Escrow Agent shall deliver all moneys held by it to its successor. Should any
transfer, astiignment or instrument in writing from the Authority or the Successor Agency be
required by any successor Escrow Agent for more fully and certainly vesting in such successor
Escrow Agent the estates, rights, powers and duties hereby vested or intended [o be vested in the
prcdccessor Escrow Agent, any such transfer, assignment �nd instrument in writing shall, �n
rcquest, be executed, acknowledged and delivered by the Authority or the Successor Agency.
Any entity into which the Escrow Agent, or any successor to il in the trusts created by
this Agreement, may be merged or converted or with which it or any successor to it may be
ronsolidated, or any entity resulting from any merger, conversion, consoliddtion or tax-free
reorganization to which the Escrow Agent or any successor to it shall be a party, shall, if it meets
the qualifications set forth in the fifth paragraph of this Section, and if it is otherwise satisfactory
to the Authority and the Successor Agency, be the successor Escrow Agent under this
Agreement without the execution or filing of any paper or any other act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
Section 17. Limitation of Powers and Duties. The Escrow Agent shall have no power
or duty to invest any funds held under thi� Agreement except as providcd in Section 5. Thc
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RESOLUTION NO. SA-RDA 062
Escrow Agent shall have no power or duty to transfer or otherwise dispose of the moneys held
hereunder except as provided in this Agreement.
Section 18. Indemnification. To the extent permitted by law, the Authority and the
Successor Agency hereby assume liability for, and hereby agree (whether or not any of the
transactions contemplated hereby are consummated) to indemnify, protect, save and keep
harmless the Escrow Agent and its agents, employees and servants, from and against, any and all
liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs, expenses and
disbursements (including reasonable legal fees and disbursements) of whatsoever kind and
nature which may be imposed on, incurred by, or asserted against, the Escrow Agent at any time
(whether or not also indemnified against the same by the Authority, the Successor Agency or any
other person under any other agreement or instrument, but without double indemnity) in any way
relating to or arising out of the execution, delivery and performance oF this Agreement, the
estabtishment hereunder of the Escrow Funds, the acceptance of the moneys and any securities
deposited therein, transfer or other application of moneys by the Escrow Agent in accordance
with the provisions of this Agreement; rovided, however, that the Authority and the Successor
Agency shall not be required to indemnify the Escrow Agent against the Escrow Agent's own
negligence or willful misconduct or the negligence or willful misconduct of the Escrow Agent's
agents, employees or servants. In no event shall the Successor Agency, the Authority or the
Escrow Agent be liable to any person by reason of the transactions contemplated hereby other
than as set forth in this Section. The indemnities contained in this Section shall survive the
termination of this Agreement and removal or resignation of the Escrow Agent.
Section 19. Limitation of Liability. The Escrow Agent and its agents and servants
shall not be held to any personal liability whatsoever, in tort, contract, or otherwise, in
connection with the execution and delivery of this Agreement, the estabiishment of the Escrow
Funds, the acceptance of the moneys or securities deposited therein, the sufficiency of the
moneys or any securities held hereunder to accomplish the payment and redemption of the
Refunded Bonds, or any payment, transfer or other application of moneys or any securities by
the Escrow Agent in accordance with the provisions of this Agreement or by reason of any non-
negligent act, non-negligent omission or non-negligent error of the Escrow Agent made in good
faith in the conduct of its duties. The Escrow Agent shall incur no liability for losses arising
from any investment made in accordance with this Agreement. The recitals of fact contained in
the Recitals of this Agreement, shall be taken as the statements of the Authority and the
Successor Agency, and the Escrow Agent assumes no responsibility for the correctness thereof.
The Escrow Agent makes no representation as to the sufficiency of any securities purchased
pursuant hereto, and any moneys to accomplish the payment and redemption of the Refunded
Bonds, pursuant ta the Prior Indentures or to the validity of this Agreement as to the Authority or
[he Successor Agency and, except as otherwise provided herein, the fiscrow Agent shall incur no
liability in respect thereof. The Escrow Agent shali not be liable in connection with the
performance of its duties under this Agreement, except for its own negligence or willful
misconduct, and the duties and obligations of the Escrow Agent shall be determined by the
express provisions of this Agreement. Anything in this Agreement notwithstanding, the Escrow
Agent shall not be liable for any consequentiai (i.e., special or indirect) losses or damages in
performing its duties or in exercising its rights or power pursuant to this Agreement. The
Escrow Agent may consuh with counsel, who may or may not be counsel to the Successor
Agency or the Authority. Whenever the Escrow Agent shall deem it necessary or desirable that a
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RESOLUTION NO. SA-RDA 062
matter be proved or established prior to taking, suffering, or omitting any action under this
Agreement, such matter (except the matters set forth herein as specifically requiring a certificate
of a nationally recognized firm of indepcndent certified puhlic accountants or an opinion of
nationally recognized bond counsel) may be deemed to be conclusive(y established by a written
certification of the Authority or the Successor Agency. Whenever the Escrow Agent deems it
necessary or desirabte, that a matter specifically requiring a certificate of a nationally recognized
firm of independent certified public accountants or an opinion of nationally recognized bond
counsel be proved or established prior to taking, suffering, or omitting any such action, such
matter may be established only by such a certificate or such an opinion. No provision of this
Agreement shall require the Escrow Agent to expend or risk its own funds or otherwise incur any
iinancial liability in the performance or exercise of any of its duties in accordance with this
Agreement, or in the exercise of its rights or powers.
Section 20. Closing of Escrow Funds; Termination of Agreement.
(a) Upon completion of disbursements from each Escrow Account within the
2017A Escrow Fund to redeem and pay the related Refunded Bondti pursuant to Section 6 of this
Agreement, all moneys (if any) remaining in such Escrow Account shall be transferred to the
Debt Service Fund established under the 2017 Indenture, to be applied to the next payment of
debt service of the 2017A BondS. Thereafter, such Escrow Account will be closed.
(b) Upon completion of disbursements from each Escrow Account within the
2017B Escrow Fund to redeem and pay the related Refunded Bonds pursuant to Section 6 of this
Agreement, atl moneys (if any) remaining in such Escrow Account shall be transferred to the
Debt Service Fund established under the 2017 Indenture, to be applied to the next payment of
debt service of the 2017B Bonds. Thereafter, such Escrow Account will be closed.
(c) An Escrow Fund shall be closed upon the closing of all of the Escrow
Account therein. This Agreemeni shall terminate upon the closing of both Escrow Funds.
Section 21. Governin Law. This Agrecment shall bc governed by the law of the
State of California.
Section 22. Sever�bilitv. If any one or more of the covenants or agreements provided
in this Agreement on the part of the Authority, the Successor Agency, or the Escrow Agent to be
performed should be determined by a court of competent jurisdiction to be contrary to law, such
covenant or agreement shall be deemed, and construed to be severable from, the remaining
covenants and agreements contained herein and shall in no way affect the validity of the
remaining provisions of this Agreement.
Section 23. Successor Deemed lncluded in References to Predecessors. All the
covenants, promises and agreements contained in this Agreement by, or on behalf of, the
Authority, the Successor Agency or the Escrow Agent shall bind and inure to the benefit of their
respective successors and atisigns, whether so expressed or not.
Section 24. Counterparts. This Agreement mdy be executed in several counterpartti,
all or any of which shall be regarded for all purposes as one original and shall constitute and be
but one and the same instrument.
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12812-OOqi11991Siivq.Jur
RESOLUTION NO. SA-RDA 062
(Non-Hvusing Bvnds E}•cro�ti� Agreement)
IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be
executed by their duly authorized officers as of the date first written above.
PALM DESERT FINANCING AUTHORITY
I�
Chief Administrative Officer
SUCCESSOR AGENCY TO THE PALM
DESERT REDEVELOPMENT AGENCY
:
Executive Director
U.S. BANK 1�1ATIONAL ASSOCIATION, as
Escrow Agent
:
Authorized Officer
12812-OOb3119915i5v4.doc
RESOLUTION NO. SA-RDA 062
APPENDIX A
LIST OF 2017A PRIOR BONDS
Project Prior Bonds Series Related Prior Loan
Area Designation Related Prior Indenture Agreement
(1) 1 Tax Allocation Refunding Indenturc of Trust. dated as oi' Project Arca No. 1, As
Revenuc Bc�nds (Pruject Ana March I, 2002 Amended. Loan Agreemcnt.
No. 1, As Amcnd�d) 2�02 datcd as of March (, 2O02
Scrics A
("2UO2 PA1 Bonds")
(2) I Tax Allocatic�n Revenue Bunds [ndenture of T'rust, dated a� of Pr�ject Arca N��. 1, As
(Pru_ject Arca No. l, As July 1, 200:� Amendrd. l.oan Agrecmcnt,
Amended) Series 2(w3 dated as of July 1, 200;
("2003 PAl Bonds")
(3) 1 Tax Allac�tiun Rel�unding Indcn�ure ol Trust, datcd as of Project Arca N��. l. As
Revenuc Bonds (Projcct Area June I, 2Q04 Amcnded, Loan A�reemcnt.
No. 1, As Amended) 2004 dated as of Junc l, 200-1
Scries A
("20(kl PA1 Bondti')
(4) 2 Tax Allocation Refunding Indenturc of Trust, dated as of Projcct Area No. 2 Laan
Revenuc Bonds (Project Area Junc I, 2(H)2 Agreement, datcd as of Junr I.
No. 2). 2002 Scrics A 2002
("2002 PA2 Bonds")
(5) 2 Tax Alle�catie�n Revenue Bonds Indenture of Trust, dated as of Project Area Nc�. 2 L��an
(Prujcct Area No. 2), Series March 1, 2003 Agreemcnt, dated as <�f March
2003 ("2003 PA2 Bonds"). but l, 2003
solely: (i) S169,400 of thc
principal maturin= on August 1,
202:�, (ii) 5176,176 uf the
principal maturinL un August I,
2024. (iii) S4R1,096 of thc
principal maturing on August 1,
2O26. anJ (iv) �2.221.560 of
the princi�al maturin�_ on
AuLust l, 203� �
(6) 4 Tax All�xation Revenuc Bonds Indenturc of Trust, dated as o( Project Arca No. 4 Loan
(Prujrct Arca No. 4), Scrics March I. 1998 Agreement, datcd as of March
1998 I , 1998
("1998 PA4 Bonds")
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RESOLUTION NO. SA-RDA 062
APPENDIX B
LIST OF 2017B PRIOR SONDS
Project Prior Bonds Series Related Prior Loan
Area Designation Related Prior Indenture Agreement
(1) I Tax Allocation Rcvenuc Bonds Indenture of Trust, datcd as of Projcct Arca No. I, As
(Projcct Area No. l, As July 1, 2006 Amended, I,oan Agrecment,
Amended), 2006 Series A datcJ as of July 1, 2006
("200b PA1 Bonds")
(2) 2 Tax Allc�catiun Rcvcnue Bonds Indenturc of Trust, dated as of Project Arca No. 2 Loan
(Projecl Area No. 2), Series March 1, 2003 Agrecment, dated as of March
2(�3 ("2003 PA2 Bonds"). but l, 2(x)3
solely: (i) g7�5.600 of thc
principal maturing on August 1,
2023, (ii) $733,824 of thc
principal maturing on August 1.
2024, (iii) �2.003,9(k1 oCthe
principal mawring on August l,
2026, and (iv) $9.253,440 of
the principal maturin� on
August 1, 2033
(3) 2 Tax Allocation Refunding Indenture of Trust, dated as of Projcct Arca No. 2 Loan
Revenuc $onds (Project Area July 1, 2006 Agreement (2006 Senior
No. 2), 2W6 Scries A Loans), dated as of July I, 200fi
("2006A PA2 Bonds")
(4) 2 Suburdinatc Tax Allocatic>n Indenture of Trust, dated as of Project Area No. 2 Loan
Revenue Capital Apprcciation July 1, 2006 Agrcement (2006 Suhordinate
Bonds (Project Area No. 2) Loan), datcd as of ]uly I, 2006
2006 Serics D
("2006D PA2 Bonds")
(5) 3 Tax Allocation Revenue Bonds Indenture of Trust, dated as ot' Project Area No. 3 Loan
(Project Arca No. 3), Serics July 1, 2(Hl3 Agrccment, dated as of July l.
200:i 2003
("2(�3 PA3 Bonds")
(6) 3 Tax Allocation Revenue Bonds Indenture of Trust, datcd as of Project Area No. :i Loan
(Project Area No. 3) 2W6 July 1. 2006 Agrecment (2W6 Senior
Series A Laans), dated as of' Juty l, 2U06
("2006A PA3 Bunds")
(7) 3 Tax Allocation Revenue Capital Indenture of Trust, dated as of Project Area No. 3 Loan
Appreciation Bonds (Project July I, 2006 Agreement (2006 Senior
Arca No. 3) 2(�6 Serics B Loans), datcd as of July 1, 2W6
("2(�6B PA3 B<mds")
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RESOLUTION NO. SA-RDA 062
Project Prior Bonds Series Related Prior I.oan
Arca Designation Related Prior Indenture Agreement
(8) 3 Subordinatc Tax Allocation Indenture of Trust, dated as of Projrct Area Nu. 3 Loan
Rev�nuc Capital Aprreciation ]uly l, 2006 Agrec:men[ (20(X� Subc>rdinatc
Bonds (Projcct Area Nu. 3) Loan), datcd as of July I, 2(x)6
2006 Series C
("2006C PA:i Bonds")
(9) 4 Tax Allocation Revenuc Bonds Indenture c�f Trust, Ncwemhcr Project Arra No. 4 Loan
(Project Arra No. 4), Scries 1. 2001 Agreement, dated as o(
2� � Novcmber 1, 2001
("2(H)t PA4 Bonds")
(10) 4 Tax Allocation Rcfunding Indenwre of Trust, dated as of Projcct Arca No. 4 Loan
Revenue Bonds (Prc�ject Area July 1, 2006 Agrcemcnt, dated as of July I,
No. 4) 2006 Serics A 20()(,
("2O06A PA4 Bonds")
(1 1) 4 Tax Allocation Rcvcnuc Capital Indcnture of Trust, datcd as of Projcct Area Nu. 4 Loan
Apprcciatiun Bonds (Projcct July I, 2006 Agrccment. datcd as of July l,
Arca lYo. 4) 2006 Scrics B 2pp(�
("2006 PA4 Bonds")
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RESOLUTION NO. SA-RDA 062
APPENDIX C
REFUNDING REQUIREMENTS
I. 2017A Prior Bonds
A. 2002 PA 1 Bonds:
Payment/ Redemption
Redemption Date Principal Interest Premium
April 1, 2017 $22,070,000* $557,332.50 --
* Con�ists of the fullowing 2002 PA1 Bonds [o bc paid or redcemcd on thc Redemplion Uatc:
Maturity
Date Remaining Intcrest Redcmption
(April 1) Principal Ratc Price
2U25 $10,905,000 S.OQO�Y� 100�I
2030 11,165 ,000 5. I 00 I 00
B. 2003 PA1 Bonds:
PaymenU Redemption
Redemption Date Principal Interest Premium
April 1, 2017 $ l 2,660,000* $316,500.00 --
* Consists of the following 2003 PA I Rcmds ro be paid or redecmed on lhe Rcdemption Uate:
Maturity
Dacc Rcmaining Intcccst Rcdemption
(April 1) Prinripal Rate Price
2026 $3,440,000 5.0(x)7c 100�
2027 3,610.000 5.0(� 100
2030 5,610,0(� 5.000 100
Disbursement
$22,627,332.50
Disbursement
� 12,976,500.00
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RESOLUTION NO. SA-RDA 062
C. 2004 PA1 Bonds:
PaymenV Redemption
Redemption Date Principal Interest Premium
April 1, 2017 $12,770,000'r 5309,250.00.00 --
= Cunsists of thc fol{owing 20(� PAl Bonds to be paid or rcdccmed on thc Rcdcmption llatc:
Maturity
Date Remaining Interest Redemption
(April I ) Principal Ratc Price
24 t 7 y I,335,000 4.500�/� 100�%
2018 I,460,(Hl0 4.625 I O(f
2019 1.420,000 5.()00 100
2020 I ,520.000 4.750 100
2021 1.620,000 4.750 100
2022 1.695,000 5.000 100
2O2:� 205,000 SA00 l00
2Q24 2,255.000 S.00Q 10O
2025 1.26O,O(R) 5.000 100
D, 2002 PA2 Bonds:
Disbursement
$13,079,250.00
(maturity)
PaymenV Redemption
Redemption Date Principal Interest Premium
February 1, 2017 S6,815,000* $166,7 ! 8.75 --
" Consisls of thc folluu•ing 2002 PA2 Bonds to hc paid or redeemed on �he Rcdemption I)atc:
Maturity
Date Remaining interest Redemptiun
(August 1) Principal Ratc Pricc
2017 $995,W0 4.750'7 100�/�
2U 1 tf 1,OSU,(xl0 4.75Q I(N)
2019 1, I OQ(Xx) 4.800 I 00
202O 1.160,000 S.OQO 1(H)
2021 1.230.0(x1 5.000 IOQ
2022 1,280,OW S.OUO tpp
Disbursement
$6,981,718.75
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RESOLUTION NO. SA-RDA 062
E. 2003 PA2 Bonds:
Paymend Redemption
Redemption Date Principal Interest Premium
February I , 2017 $3,048,232* $ --
� Consists of the (ollowing 2(X)6A PA2 Bonds to be paid or redecmcd on the Redemptiun Date:
Disbursement
$
Rcmaining
Maturity Principal to bc
Date paid from 2UI7A Interest Redcmption
(August 1) EscrowFund** Ratc Pricc
2023 $ I 69.400 4.500� 1007r
2U24 176,176 4.5(� 100
2026 481,096 4.625 100
2033 2,221,560 5.000 1(x)
** Such principal, togc[hcr with the principal lo paid f'rom thc 2003 PA2 Escrow Account of th� 20178 Escrow
Fund, cyual the full amounl of thc principal outstanding
F. 1998 PA4 Bonds:
Payment! Redemption
Redemption Date Principal Interest Premium
April 1, 201? $6,670,000* $173,245.00 --
* Consists of [hc following 1998 PA4 Bonds lo bc paid or rcdremcd on thc Rcdemption Uate:
MaWrity
Datc
(Octc�hcr I )
2017
2028
2028
Remaining Intcrest
Principal Rate
$175,Q00 5.000
2,020,000 5.200
4,475.000 S,2(x)
Rcdcmption
Pricc
100�/c
]00
100
Disbursement
�6,843,245.00
C-3
1281 ?-0003\ 199193,5v4.doc
RESOLUTION NO. SA-RDA 062
II. 2017B Prior Bonds
G. 2006A PA1 Bonds:
PaymenU Redemption
Redemption Date Principal Interest Premium
April l, 2017 $37,780,Q00* $957,222.50 --
" C�msists u1 the following 200f,A VA1 Bunds to he paid or redeemcd on thc Redemption Date:
Maturity
Datc Rcmaining Intcrest Rcdcmption
(Aprill) Principal Ratc Prire
Disbursement
$38,737,222.50
2017 � I .000.(x?0 5.0007c 1007 (maturity)
201 R I.(x)5.000 5.250 100
2019 5.(?65.Q(H) 5.250 100
2020 5,285,Ot� 5.250 I(H)
2022 11.365.0O0 5.000 100
2023 7,690.0W 5.000 100
2024 960,000 5.(X)0 100
2025 I.000.000 5.O00 l00
2026 :t,3�i5,000 5.(xx) l0U
2027 250.000 4.700 100
2028 26Q.000 4.700 100
2029 275,(x)0 4.750 100
203Q 290.000 4.750 100
H. 2003 PA2 Bonds:
Payment/ Redemption
Redemption Date Principal Interest Premium Disbursement
February 1, 2017 $12,696,768 '` $ __ $
* Consitits of thc tiillowing 2006A PA2 liunds to hc paid or redecm�d on the Redemption Date:
Rrmaining
Maturity Principal to bc
Datc paid Gom 2017B Interest Redcmption
(August 1) Escruw Fund"* Rate Price
2023 S7OS,6(x) 4.500�%, 10U7
2024 7��,824 4.500 l00
2026 2.(H)3.90�1 4.625 100
20i3 9.253,440 S.(H)0 100
*" Such principal, togethcr with the principal to paid from thc 200.i PA2 Escrow Accounl of the 2017A Escrow
Fund, equal the full amount of the principal outstandine
C-4
I 28 t 3-(NlO3\I991 S? i� 4.doc
RESOLUTION NO. SA-RDA 062
I. 2006A PA2 Bonds:
Paymend Redemption
Redemption Date Principal Interest Premium
February l, 2017 �36,510,000* $ --
* Consists of thc following 2006A PA2 Bonds to be paid or redecmed on the Redemption Dutc:
Maturity
Date Remaining
(August 1) Principal
2017 $810.000
20 � s sao,000
2019 880,t100
2020 915.000
202 I 950,(Xx)
2022 1,OOS,OW
202:i 1,520.000
2024 (,60QO(x)
2025 1.485,(xH)
2026 1,415,OW
203 I 8,22_5,000
2036 t6,865,0()0
Interest
Ratc
4.250�1
4.500
4.SUU
4.SQ0
4.500
4.625
4.625
4.750
4.750
4.750
4.9(H)
5.125
ReJcmption
Pricc
t (x)�k
t00
►oo
100
100
S00
100
1(H)
�cx�
100
100
100
Disbursement
$
GS
I �812-U()03\1991 S;Sv4.doc
RESOLUTION NO. SA-RDA 062
J. 2006D PA2 Bonds:
Payment/ Accreted Redemption
Redemption Date Value Premium Disbursement
February 1, 2017 $ * -- �
* Cunsists oC thc fe�llowing 2006U PA2 Bunds lo be paid or redeemed on lhe Redcmption Uatc:
Accreted Value
Mawrity Yicld to as of
batc lnitial Maturity Redcmpti�n
(August 1) Principal Amount Maturity Am�iunt Date Date
2017 $489,413.R5 $8R5,O00
2l� � (7 ,J��.' 7(l.�l� � .1�21�.1�1�
2019 556,998.15 1.165.000
2020 583,801.50 1310,000
202 I 601,155.50 1,450,000
2022 622.659.75 1,605.0(x)
2023 640.715A0 1,755,00O
202�1 656.(k�6.8U 1,910.000
2025 668.H;7.70 2.070,000
2026 679,171.80 2.2�5.000
2027 400.O:i6.00 1.400.000
2O28 380,1 I I.45 1.415.000
2U29 345,925.00 1.370.(xx)
2Q30 i39,324J0 1.430.0(l0
203 l i3 i,:i 10.25 1.495.000
2O:i2 326.726.4O 1,560.00O
20?3 320,4y8.7S I.625.000
2034 :� I 6.652.60 1,705,000
2035 362.896.75 2,075,000
5.450�7i
5.650
5.750
s.xso
5.950
6.00O
6.010
6.020
6.0 i0
6.(k30
6.050
6.060
6.O7q
6.080
6.O90
6.100
6.100
6. I OQ
6.100
Redcmption
Pric:e (as �/r
of' Accrctcd
Value
� W �/f
�a�
i cx�
ioo
1(1Q
1(?�
100
100
i cx�
100
100
100
l00
100
100
100
100
i cx�
100
G6
I?812-0003\199153Sti4.doc
RESOLUTION NO. SA-RDA 062
K 2003 PA3 Bonds:
PaymenU Redemption
Redemption Date Principal Interest Premium
April 1, 2017 $3,325,000* �81,673.75 --
* Consists of the following 2003 PA3 Bonds to be paid or redcemed on thc Redemption Uate:
Maturity
batc Rcmaining Intcrest Redemption
(April I ) Principal Rate Pricc
20 l 7 $13Q000 4.2U0� 100�%r
2018 140,(x� 4.3(� 10O
2019 145,000 4.350 100
2020 15O.000 4.450 100
2021 155,000 4.550 100
2022 165.000 4.60O 100
202:� 170.(x)0 4.650 100
2033 2.270.000 5.125 1(x)
L. 2006A PA3 Bonds:
Disbursement
$3,406,673.75
(maturity)
PaymenU Redemption
Redemption Date Principal Interest Premium
April 1, 2017 $10,695,000* $258,140.63 --
* Consists of the foltowing 2006A PA3 Bands to be paid or rcdccmed on thc Redemptian Date:
Maturity
Datc Remainin� Intcrest Redcmptiun
(April l) Principal Ratc Price
Disbursement
$10,953,140.63
2017 $220,000 4250�%r 1(H)�/ (maturity)
2018 225,000 4.500 100
2019 240,000 4.SW 100
2022 250,000 4.625 100
2023 265.00U 4.625 l00
2024 275,000 4.750 100
2025 285,000 4.750 l0U
2036 4,465,OW 4.750 100
2041 4,470.00b 5.(x)0 l00
C-7
1281 ?-Ob03\ 19915 35 � 4.doc
RESOLUTION NO. SA-RDA 062
M. 2006B PA3 Bonds:
PaymenU Accreted Redemption
Redemption Date Value Premium Disbursement
April 1, 2017 S * -- $
" Ce�nsists of the following 2W6H PA? BonJs to be paid or rcdeeme� on thc Rcdcmptiun Uatc:
Accreted
Valuc
Maturity Yield to as of
Datc Initial Mawrity Rcdcmption
(April 1) Principal Amount Maturity Amuunt Date Date
2020
zozi
2027
Zozx
I 2812-0(K)3\ 1991535��4.doc
$122.040.00 $250.U00 5.�107�
I I 5,147.50 250,(x)0 5.350
102, I 35.60 315,000 5.520
44,3�6.65 145,()00 5.540
C-8
Rcdcmption
Pricc (as
rl of� Accretcd
Value
i cx�
IUU
100
100
RESOLUTION NO. SA-RDA 062
N. 2006C PA3 Bonds:
PaymenU Accreted Redemption
Redemption Date Value Premium Disbursement
April 1, 2017 $ * -- �
'� Consists of the foltowing 2006C PA3 Bunds to bc paid or redeemeJ on the Redcmption Date:
Accreted
Value
Maturity Yield to as of
Date Initial Maturity Maturity Redemption
(April 1) Principal Amount Amount Date Date
2017 $109,786.95
2018 119,954.20
2019 129,115.95
2020 138,561.50
2021 143,741.80
2022 150,354.60
2023 147,078.25
2024 143,639.40
2025 141,715.]0
2026 137,936.65
2027 135,533.55
2028 131,534.40
2029 128,790.00
2030 125,876.40
2031 122,823.00
2032 1 I 9,660.80
2033 116,707.60
20�4 1 I 1,793.20
� 195,000
230,000
265,000
305,000
340,000
380,000
395,000
410,000
430,000
445,000
465,000
480,000
500,000
520,000
540,000
560,000
5 80,000
590,000
5.450�'Ic
5.650
5.750
5.850
5.950
6.000
6.010
6.020
6.030
6.040
6.050
6.060
6.070
6.080
6.090
6. I 00
6.100
6. I 00
Redemption
Price (as
rIc of
Accreted
Value
]00
100
100
100
100
100
100
100
100
100
]00
100
100
100
100
100
100
]00
(maturity)
C-9
1281 �-0(K)3\1991535v4.Joc
RESOLUTION NO. SA-RDA 062
O. 2001 PA4 Bonds:
PaymenU Redemption
Redemption Date Principal Interest Premium
April 1, 2017 $11,375,000* �270,452.50 --
" Cunsists of the followine 2001 PA4 Bonds to be p�id or redecmcd on thc Redemption Date:
Mawrity
Datc Remaining Interest Redemp�ion
(Octc�ber l) Principal Rate Price
2017 $250.000 4.400 100'%
2018 275,000 4.500 100
2019 2R5,(�0 4.550 100
2020 295.000 4.600 100
2021 305,000 4.650 1O0
2022 I, l 55.000 4.700 100
2022 �i I 5,000 4.700 100
2031 2.440,000 4.A00 lOQ
20� l 6.045,(Nx) 4.800 100
P. 2006A PA4 Bonds:
Paymend Redemption
Redemption Date Principal Interest Premium
Apri I 1, 2017 $10,620,000* $255,285.00 --
* Consists ol'the folluwing 2006A PA4 Bunds to hc paid or r�dccmcd on the Redemption l)aee:
Maturity
Date Rcmaining Interest Rcdcmption
(OctoScr I ) Principal Rate Pricc
201 H �270,000 4.400� 1O0�/c
2019 300.000 4.4O0 100
2020 125,Q00 4.45U 100
202I 300.000 �.SUO 1O0
2022 575,000 4.SQ0 100
2023 60O.(H)0 4.500 100
2024 635,0OU 4.500 100
2025 665.000 4.550 100
2(12fi 695,11OO 4.6U0 I UU
2029 2,200,000 5.0a0 l0O
2034 4.255,000 S.Q00 100
Disbursement
$1 1,645,452.50
Disbursement
� 10,875,285.00
C-10
I 2812-OOU3t 1991535 vd.da;
RESOLUTION NO. SA-RDA 062
Q. 2006B PA4 Bonds:
Payment/ Accreted Redemption
Redemption Date Value Premium Disbursement
April 1, 2017 �a * -- �
* Consists of the fullowing 20068 PA4 Bonds to be paid or redcemed on the Redemption Datc:
Accretcd Value Redemption
Maturity Yield to as of Pricc (as
Datc Initial Maturity Redemption 7r of Accreted
(Octobcr i) Principal Amount Maturity Amount Datc Date Valuc
2017 $106,489.70 $185.000 5.(��/c 100
2019 3R,167.50 75,(xx) S.19 l00
2020 168,052.50 350.(�0 5.24 100
2021 124.fi46.50 275.000 5.2R 100
2022 49,244.15 115,(x)0 5.3( ]00
2023 86,926.65 215,000 5.34 100
2024 114,456.00 30Q,0(l0 5.37 100
2025 140,587.20 39b,000 5.39 100
2026 16�,425.60 480,000 5.41 100
2027 182,844.60 570.(xH) 5.44 100
2028 204.329.25 675.000 5.46 100
2029 244,136.70 855,000 5.48 100
2030 385,013.20 1,430.(?(H) 5.50 l00
2031 :�85,745.60 1,520,0(H) 5.52 100
2032 598,970.SS 2,505.QQ0 S.S4 100
2033 5�8,022.40 2.560.000 5.55 I(H)
2()34 560.663.40 2.63Q0(x) S.Sb 100
C-11
I 2812-0003\ l99 t 535v4.doc
RESOLUTION NO. SA-RDA 062
APPENDIX D
ESCROW SECURITIES
I. 2017A Escrow Fund
a. 2002 PA1 F.scrow Account — On ihe Closing Date, the Escrow Agent shall usc
� of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
F.xpected Receipt
at Maturity
(including
Principat principal and
Securities Type Maturity Amount Coupon interest)
b. 2003 PA1 F.scrow Account — On the Closing Date, the Escrow Agent shall use
� of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
I 2812-0003U 99 ( 535v4.doc
RESOLUTION NO. SA-RDA 062
c. 2004 PA1 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
d. 2002 PA2 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
e. 2003 PA2 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principat and
Securities Type Maturity Amount Coupon interest)
12812-0003\1991S35v4.Joc
RESOLUTION NO. SA-RDA 062
f. .1998 PA4 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Eticrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninves[ed cash, will be sufficient to satisfy
the rclated Refunding Requircment of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
i? tS I �-(H1�3\ 1991 i i 5 v4.duc
RESOLUTION NO. SA-RDA 062
II. 2017B Escrow Fund
a. 2006 PA1 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at mawrity
oF such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
b. 2003 PA2 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of �
Principal
Securities Type Maturity Amount Coupon
Expected Receipt
at Matunity
(including
principal and
interest)
c. 2006A PA2 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of �
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
1281 ?-0(H)3\ 199153Sv4.doc
RESOLUTION NO. SA-RDA 062
d. 2006D PA2 Escrow Accounl — On the Closing Date, the Escrow Agent shall usc
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principaf and
Securities Type Maturity Amount Coupon interest)
e. 2003 PA3 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the rclated Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
f. 2006A PA3 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at ma[urity
of such Escrow Securi[ies, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of 5
Expected Receipt
at Maturity
(including
Principal principa! and
Securitics Typc Maturity Amount Coupon interest)
1 �812-IX103\1991535v4.duc
RESOLUTION NO. SA-RDA 062
g. 2006B PA3 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, wiU be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
h. 2006C PA3 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon interest)
i. 2001 PA4 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of �
Expected Receipt
at Maturity
(including
Principal principal and
Securities Type Maturity Amount Coupon intcrest)
1281?-0003\199151Sv4.dor
RESOLUTION NO. SA-RDA 062
j. 2006A PA4 Escrow Account — On the Closing Date, the Escrow Agent shall use
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, wiil be sufficient to satisfy
the related Refunding Requirement of $
Expected Receipt
at Maturity
(including
Pcincipal principal and
Securities Type Maturity Amount Coupon interest)
k. 2006B PA4 Escrow Account — On the Closing Date, the Escrow Agent shall u�e
$ of the moneys deposited to purchase the Escrow Securities identified
below and hold the remaining $ as cash. The expected receipt at maturity
of such Escrow Securities, plus the uninvested cash, will be sufficient to satisfy
the related Refunding Requirement of �
Expected Receipt
at Maturity
(including
Principal principal and
Securitics Type Maturity Amount Coupon interest)
I?61?-(Nlfl�\19915'�iv4.�or
RESOLUTION NO. SA-RDA 062
APPENDIX E
Form of
NOTICE OF DEFEASANCE
with reference to
PALM DESERT FINANCING AUTHORITY
Tax AI►ocation Revenue Bonds & Tax Allocation Revenue Bonds described herein
This Notice is being given on behalf of the Palm Desert Financing Authority (the
"Authority") to the owners of the bonds identiiied in Exhibit I(the "Bonds"), issued pursuant to
the Indentures of Trust (collectively, the "Indentures"), each by and between the Authority and
U.S. Bank National Association, as successor trustee (the "Trustee").
Pursuant to the Indentures, the lien with respect ro the Bonds under the Indentures has
been discharged through the irrevocable deposit of cash and certain securities (consisting of non-
callable United States Treasury Obligations) in escrow funds (the "Escrow Funds"), pursuant to a
Non-Housing Bonds Escrow Agreement, dated as of January 1, 2017 (the "Escrow Agreement"),
by and among the Authority, the Successor Agency to the Palm Desert Redevelopment Agency
and the Trustee. Such deposit into the Escrow Funds has been calculated to provide sufficient
moneys to pay the outstanding principal and unpaid accrued interest due on the Bonds to (and
including) their respective final payment or redemption dates, as identified in Exhibit I.
As a result of the deposit into the Escrow Funds, the Bonds are dcemed to have been paid
and defeased in accordance with the respective Indentures. Obligations of the Authority to the
owners of the defeased Bonds are hereafter limited to the application of moneys in the EScrow
Funds for the principal and interest payment (including redemption price, as applicable) on the
Bonds as the same become due and payable as described above.
Dated: , 2017
U.S. BANK NATIONAL AS50CIATION,
as Trustee
I 281 ?-Olx)3\ 1991535v4.doc
RESOLUTION NO. SA-RDA 062
EXHIBIT I
(to Notice of Defeasance)
1. Tax Atlocation Refunding Revenue Bonds (Project Area No. l, As Amended), 2002
Series A, issued under Indenture of Trust, dated as of March 1, 2002
CUSIP* Date on which
Remaining (Base: Principal will bc
Maturity Date Principal Interest Rate 696617) Redeemed
4/ 1/2025 $ I 0,905,000 5.0009c J L4 4/ I/20 I 7
4/l/2030 11,165,000 5.100 JM2 4/1/2017
2. Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), Series 2003,
issued under Indenture of Trust, dated as of July 1, 2003
CUS1P* Date on which
Remaining (Base: Principal will be
Maturity Date Principal Interest Rate 696617) Redeemed
4/ I/2026 $3,440,000 5.000`Ic MG 1 4/ 1/20 l 7
4/I/2027 3,610,OU0 5.000 MH9 4/1/2017
4/ 112030 5,610,000 5.000 MJ 5 4/ 1/20 I 7
3. Tax Allocation Refunding Revenue Bonds (Project Area No. l, As Amended), 2004
Series A, issued under I�denture of Trust, dated as of June l, 2004
CUSIP* Date on which
Remaining (Base: Principal will be Paid
Maturity Date Principal Interest Rate 696617) or Redeemed
4/I/2017 $1,335,000 4.SOO�Ic MX4 4/1/2017
4/ 1/2018 1,460,000 4.625 M Y2 4/ 1/20 I 7
4/ I/2019 1,420,000 5.000 M"L9 4/ 1/2017
4/ 1/2020 1,52U,000 4.750 NA3 4/ 1/2017
4/ 1/2021 1,620,000 4.750 IVB I 4/ 1/2017
4/ 1/2022 1,695,000 5.000 NC9 4/ 1/2U 17
4/ 1/202 3 205,000 5.000 N07 4/ 1/2017
4/ 1/2024 2,255,000 5.000 NES 4/ 1/2017
4/ 1/2025 1,260,000 5.000 NF2 4/ I/2017
'� Neither the Authnriry nur the Trustee shall be held responsihle for the selection or use of the CUSIP
nuinber, nor is uny representatinn mctde «s tn its rorrermes.s. /t i.s inclurled solely� f��r ronvenience of Ihe
u►rfiers ��f the Bnnds.
Exhibit I-1
I 28l Z-O(x)?\1991 S3Svd.doc
RESOLUTION NO. SA-RDA 062
4. Tax Allocation Revenue Bonds (Project Area No. 1, As Amended), 2006 Series A,
issued under Indenture of Trust, dated as of July 1, 2006
CUSIP* Date on which
Remaining (Base: Principal will be Paid
Maturity Date Principal Interest Rate 696617) or Redeemed
4/ 1/20 l 7 $1,000,000 5.000�� NGO 4/ 1/2U 17
4/ 1/2018 1,005,000 5.250 NH8 4/ 1/2017
4/ 1/2019 5,065,000 5.250 NJ4 4/ 1/2017
4/1/2020 5,285,000 5.250 NK1 4/I/2017
4/ 1/2022 11,365,000 5.000 NM7 4/ 1/20l 7
4/1/2023 7,690,000 5.000 NNS 4/1/2017
4/1 /2024 960,000 5.000 NPO 4/1/2017
4/ 1/2025 1,000,000 5.000 NQ8 4/ 1/2017
4/1/2026 3,335,000 5.000 NR6 4/1/2017
4/ 1/2027 250,000 4.700 NS4 4/ 1/2017
4/ I/2028 260,000 4.700 NT2 4/ 1/2017
4/ 1/2029 275,000 4.750 NU9 4/ 1/2017
4/1/2030 290,000 4.750 IVV7 4/1/2017
5. Tax Allocation Refunding Revenue Bonds (Project Area No. 2), 2002 Series A,
issued under Indenture of Trust, dated as of June 1, 2002
CUSIP* Date on which
Remaining (Base: Principat will be
Maturity Date Principal Interest Rate 696617) Redeemed
8/1/2017 $995,000 4JSO�Ic KC2 2/1/2017
8/ 1/2018 1,050,000 4.750 KDO 2/ 1/2017
8/ 1/2019 1,100,000 4.800 KE8 2/ 1/2017
8/ 1/2020 1,160,000 5.000 KFS 2/ 1/2017
8/ 1/2021 1,230,000 5.000 KG3 2/ 1/20 t 7
8/1/2022 1,280,000 5.000 KHl 2/1/2017
* Neither the Authority nnr the Trustee shal! be held responsible for the selection or use of the CUSIP
numher, nor is any representutia2 made as to its rorrectness. /t is inclucfed solely fi�r com�enience of the
owners of the Bunds.
Exhibit I-2
l2$12-0003U991$i$v4.doc
RESOLUTION NO. SA-RDA 062
6. Tax Allocation Revenue Bonds (Project Area No. 2), Series 2003, issued under
Indenture of Trust, dated as of March 1, 2003
CUSIP* Date on which
Remaining (Base: Principal will bc
Maturity Date Principal Interest Rate 696617) Redecmed
8/ 1/2023 $875,000 4.5009'c LF4 2/ I/2017
8/ 1/2024 910,0(}0 4.500 LG2 2/ I/2017
8/ 1/2026 2,485,000 4.625 LHO 2/ 1/2017
8/ 1/2033 I 1,475,000 5.000 LJ6 2/ 1/2017
7. Tax Allocation Refunding Revenue Bonds (Project Area No. 2), 2006 Series A,
issued under Indenture of Trust, dated as of July 1, 2406
CUSIP* Date on which
Remaining (Base: Principal will be
Maturity Date Principal Interest Rate 696617) Redeemed
8/1/2017 $810,000 4.2509� PS2 2/1/2017
8/ I/2018 840,000 4.500 PTO 2/ 1/2017
8/1/2019 880,000 4.500 PU7 2/1/2017
8/I/2020 915,000 4.500 PVS 2/1/2017
8/1/2021 950,000 4,500 PW3 2I1/2017
8/ 1/2022 1,005,000 4.625 PX 1 2/ 1/2017
8/1/2023 1,520,000 4.625 PY9 2/I/2017
8/ 1/2024 1,600,000 4.750 PZ6 2/ I/20 I 7
S/ 1/2025 1,485,000 4.750 QAO 2/ I/2017
8/1/2026 1,4l5,000 4.750 QB8 2/1/2017
8/ 1/203 I 8,225,000 4.900 QC6 2/ I/2017
8/1/2036 16,865,0(}0 5.125 QD4 2/1/2017
* Neither the Auth��rity no� the Trustee shul/ be held respunsihle for ihe selection vr use nf the CUS/P
numher, nor is un�• representution mude us tv its correctness. It is inclt�ded solely fur conveni��nce �f �he
o�cners nf the Bo�uls.
Exhibit I-3
1? 8 I 2-0003\ I�J I 5 3 S���1. dtx:
RESOLUTION NO. SA-RDA 062
8. Subordinate Tax Allocation Revenue Capital Appreciation Bonds (Project Area No.
2), 2006 Series D, issued under Indenture of Trust, dated as of July 1, 2006
Accreted Value
Yield to CUSIP* Date on which as of
Maturity Initial Maturity (Base: Bonds will be Redemption
Date Principal Date 696617) Redeemed Date
8/1/2017 $489,413.85 5_450�� RP6 2/1/2017
8/1/2018 522,178.80 5.650 RQ4 2/1/2017
8/1/2019 556,998.15 5.750 RR2 2/1/2017
8/ 1/2020 583,801.50 5.850 RSO 211 /2017
8/1/2021 601,155.50 S.4S0 RT8 2/1/2017
8/1/2022 622,659.75 6.000 RUS 2/1/20(7
8/1/2023 640,715.40 6.010 RV3 2/1/2017
S/1/2024 656,046.80 6.020 RW 1 2/1/2017
8/l/2025 668,837.70 6.030 RX9 2/1/2017
8/ I/2026 679,171.80 6.040 RY7 2/ 1/2017
8/ 1/2027 400,036.00 6.050 RZ4 2/ 1/2017
8/1/2028 380,111.45 6.060 SA8 2/1/2017
8/1/2029 345,925.00 6.070 SB6 2/1/2017
8/1/2030 339,324.70 6.080 SC4 2/1/2017
8/1/2031 333,310.25 6.090 SD2 2/1/2017
8/1/2032 326,726.40 6.100 SEO 2/1/2017
8/ 1/2033 320,498.75 6.100 SF7 2/ 1/2017
8/ 112034 3 I 6,652.60 6.100 SG5 2/ 1/2017
8/1/2035 362,89b.75 6.100 SN3 2/1/2017
9. Tax Allocation Revenue Bonds (Project Area No. 3), Series 2003, issued under
Indenture of Trust, dated as of July 1, 2003
CUSIP* Date on which
Remaining (Base: Principal will be Paid
Maturity Date Principal Interest Rate 696617) or Redeemed
4/1/2017 $130,000 4200�I� LY3 4/1/2017
4/ 1/2018 140,OOQ 4.300 L"LO 4/ 1/2017
4/ I/2019 145,000 4.:iS0 MA4 4/ 1/2017
4/ 1/2020 150,000 4.450 MB2 4/ 1/2017
4/ 1/202 l 155,000 4.550 MCO 4/ 1/2017
4/ l/2022 165,000 4.600 MD8 4/ 1/2017
4/ 1/2023 I 70,000 4.650 ME6 4/ 1/2017
4/ 1/2033 2,270,000 5. l 25 MF3 4/ 1/2017
* Neither the Authority nnr the Trustee .shall be hefct responsible f'or the selection or use of the CUS/P
numher, nor is uny representutiun mude us to its correctness. /t is inclerded solely for convenience of the
o►i•ners of the Bonds.
Exhibit I-4
12R12-0003\1491535v4.doc
RESOLUTION NO. SA-RDA 062
10. Tax Allocation Revenue Bonds (Project Area No. 3), 2006 Series A, issued under
Indenture of Trust, dated as of July 1, 2006
CUSIP* Date on which
Remaining (Base: Principal will be Paid
Maturity Date Principal Interest Rate 696617) or Redeemed
4/I/2017 $220,000 4.250�� SS9 4/1l2017
4/ I/2018 225,000 4.500 ST7 4/ l/2017
4/ 1/20 I 9 240,000 4.500 S U4 4/ 1/2017
4/ 1/2022 250,000 4.625 S V 2 4/ 1/20 I 7
4/ 1/2023 265,000 4.625 S WO 4/ 1/20 I 7
4/1 /2024 275,000 4.750 SX8 4/ 1/2017
4/ 1/2025 285,000 4.750 SY6 4/ 1/2017
4/I/2036 4,465,000 4.750 SZ3 4/1/2017
4/ 1/2041 4,470,000 5.000 TA7 4/ 1/2017
11. Tax Allocation Revenue Capital Appreciation Bonds (Project Area No. 3), 2006
Series B, issued under Indenture of Trust, dated as of July l, 2006
Accreted Value
Yield to CUSIP* Date on which as of
Matnrity Initial Maturity (Base: Bonds will be Redemption
Date Principal Date 696617) Redeemed Datc
4/ 1/2020 $122,040.00 5 31 O�l� TB 5 4/ 112017
4/ 1/2021 115,147.50 5.350 TC3 4/1 /2017
4/1/2027 102,135.60 5.520 TD1 4/1/2017
4/1/2028 44,336.65 S.S40 TE9 41U2017
* Neither the Aut{:oritS• nor the Trustee shu!! he held responsihle fnr the selectlon or use of the CUS/P
n�rmber, nor i.s un�� repre,sentatinn mcrde us �n its c��rrectne.ss, /t i.c inr•luclerl suleJy for ennvenienc�e �f the
u►cners of the Bnncl.s.
Exhibit I-5
I 2812-(�i\ 1991 i 15� 4.duc
RESOLUTION NO. SA-RDA 062
12. Subordinate Tax Allocation Revenue Capital Appreciation Bonds (Project Area No.
3), 2006 Series C, issued under Indenture of Trust, dated as of July 1, 2006
Accreted Vatue
Yield to CUSIP* Date on which as of
Maturity Initial Maturity (Base: Bonds will be Redemption
Date Principal Date 696617) Redeemed Datc
2017 $109,786.95 5.450�I� TP4 4/1/2017
2018 119,954.20 5.650 TQ2 4/1/2017
2019 129,115.95 5.750 TRO 4/ 1/2017
2020 138,561.50 5.850 TS8 4/1/2017
2021 143,741.80 5.950 TT6 4/1/2017
2022 150,354.60 6.000 TU3 4/1/2017
2023 147,078.25 6.010 TV 1 4/1/2017
2024 143,639.40 6.020 TW9 4/1/2017
2025 141,715.10 6.030 TX7 4/1/2017
2026 137,936.65 6.040 TY5 4/1/2017
2027 135,533.55 6.050 TZ2 4/1/2017
2028 131,534.40 6.060 UAS 4/1/2017
2029 128,790.00 6.070 UB3 4/1/2017
2030 125,876.40 6.080 UC 1 4/ 1/2017
2031 122,823.00 6.090 UD9 4/1/2017
2032 119,660.80 6.100 UE7 4/i/2017
2033 116,707.60 6.100 UF4 4/1/2017
2034 111,793.20 6.100 UG2 4/ 1/20I 7
13. Tax Allocation Revenue Bonds (Project Area No. 4), Series 1998, issued under
Indenture of Trust, dated as of March 1, 1998
CUSIP* Datc on which
Remaining (Base: Principal will be
Maturity Date Principal Interest Rate 696617) Redcemed
l0/1/2017 $175,000 5.000�/� HF9 4/1/2017
]0/1/2028 2,020,000 5.200 HG7 4/l/2017
10/1/2028 4,475,000 5.200 HJ1 4/I/2017
* Neither the Authority nor �he Trustee shull be held responsibfe for the se[ection or use of the CUSlP
numher, nor is any representation mucle us to its correctness. It is inclucted solely for convenience of the
ow•ners of the Bonds.
Exhibit I-6
I Z8I 2-OW3�1991535va.doc
RESOLUTION NO. SA-RDA 062
14. Tax Allocation Revenue Bonds (Project Area No. 4), Series 2001, issued under
Indenture of Trust, dated as of November l, 2001
CUSIP* Datc on which
Remaining (Base: Principal will be
Maturity Date Principal [nterest Rate 696617) Redeemed
10/I/2017 $260,000 4.400�� JA8 4/1/2017
10/1/2018 275,000 4.500 JB6 4/1/2017
10/1/2019 285,000 4.550 JC4 4/1/2017
10/1/2020 295,000 4.600 JD2 4/t/2017
10/ 1/2021 305,000 4.650 JEO 4/ 1/2017
10/ l/2022 1,155,000 4.700 J F7 4/ 1/2017
10/ l/2022 315,000 4.700 J H3 4/ 1/2017
10/ I/203 I 2,440,000 4.800 JJ9 4/ 1/2017
1 U/ 1/2031 6,045,000 4.800 J K6 4/ 1/20 I 7
15. Tax Allocation Refunding Revenue Bonds (Project Area No. 4), 2006 Series A,
issued under Indenture of Trust, dated as of July 1, 2006
CUSIP* Date on which
Remaining (Base: Principa) will be
Maturity Date Principal Interest Rate 696617) Redeemed
10/ 1/2018 $270,000 4.4007� UU 1 4/ 1/2017
10/ 1/2019 300,000 4.400 U V 9 4/ 1/20 I 7
10/ I/2020 125,000 4.450 U W 7 4/ l/2017
10/ I/2021 300,000 4.500 UXS 4/ 1/2017
10/I/2022 575,000 4.500 UY3 4/1/2017
10/ 1/2023 600,OOa 4.500 UZO 4/ 1/20 I 7
10/ I/2024 635,000 4.500 VA4 4/ 1/2017
10/1/2025 665,000 4.550 VB2 4/l/2017
10/ 1/2026 695,000 4.600 V CO 4/ 1/2017
10/ 1/2029 2,200,000 5.000 C D8 4/ 1/2017
] O! U2034 4,2i5,000 5.000 V E6 4/ I/2017
* Neither the Authori�y nnr the Trustee shct!! be held responsih[e for the selection or u.re of' the CUS/P
ntrmber, nor is uny representutiofi made us to its correctness. It is inclu�led snlely� for cunvenience uf the
o►ti•ners of the Bonds.
Exhibit I-7
I?R 1'_'-OW 3\ t 991535v4.doc
RESOLUTION NO. SA-RDA 062
16. Tax Allocation Revenue Capital Appreciation Bonds (Project Area No. 4), 2006
Series B, issued under Indenture of Trust, dated as of July 1, 2006
Accreted Value
Yield to CUS[P* Date on which as of
Maturity Initial Maturity (Base: Bonds will be Redemption
Date Principal Date 696617) Redeemed Date
10/1/2017 $106,489.70 S.00�I� WGO 4/I/2017
10/1/2019 38,167.50 5.19 WH8 4/1/2017
10/l/2020 168,052.50 5.24 VQ9 4/1/2017
10/1/2021 124,646.50 5.28 VR7 4/I/2017
10/1/2022 49,244.15 5.31 VSS 4/1/2017
I 0/ 1/2023 86,926.65 5.34 VT3 4/ I/20l 7
I 0/ t/2024 1 i 4,456.00 5.37 V UO 4/ 1/2017
10/1/2025 140,587.20 5.39 VV8 4/1/2017
10/1/2026 163,425.60 5.41 VW6 4/1/2017
10/1/2027 182,844.60 5.44 VX4 4/1l2017
10/1/2028 204,329.25 5.46 VY2 4/1/2017
10/1/2029 244,136.70 5.48 VZ9 4/1/2017
10/1/2030 385,013.20 5.50 WA3 4/1/2017
10/1/2031 385,745.60 5.52 WBI 4/I/2017
10/1/2032 598,970.55 5.54 WC9 4/1/2017
10/1/2033 578,022.40 5.55 WD7 4/1/2417
10/1/2034 560,663.40 5.56 WES 4/1/2017
* Neither the Authoriry nor the Trustee shall be held respunsible for the selection or use of the CUSIP
number, nor is any representutivn made as to its correctness. /t is included solely for cnnvenience of the
owners of the Bonds.
Exhibit 1-8
12812-0003\ 1991535 v4.dcx
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RESOLUTION NO. SA-RDA 062
FREI.I�1I��'ARY C�F�ICI,�L STATEti71sNT ll�1'ED �___, 201C,
NEW ISSUE — BOOK-EN1'RY RATINGS
Iasnred Bonds Radng: S&P: " "
Uninsured Bonds and Underlyiag Rating: S&P: " "
(See "CONCLUDING tNFORMATION • Ratings on the Bonds"}
Ja the opinina oJ RirhnrJs. Wu�snn dc Grrshun, A Prufrssinrw! Corporatian. Bnmi Coa+ccrt. xndrr rsisting (aw: (i) assuming con[inurng rompliance k�i�h cenuin
corerurnts unr! rhe arcurac.t oJcertnin rrpresenrvtions, inrrrest on thr 2017 Srrirs A Bnndr 'u rscluJed jrvm gross rncome fo� jrderat ira ome rur yurpasar and 'rs nor nn irrm af
tai prtfrrtncr for purpnses of the fedrra! altrrna�ive rrrinimum rax impared on indivicluu7.c and corporvtionr, aeut fii) in�rresr nn rAr Bnnds is ezempt jrom Srare oJ Cnlrfarnia
persorur! income taxes. /nterest n� rhe 2017 Series A 8anrls may he subjecr fn crnuin fedrral taxa impusrd urt ee�tain corpo�tians, incLu�ing the corpo(att atrcrnarrie
mtnlmum tux on a portian of lhat interest. Boeut Coun,rrl e.rpresses n� oprniort ns to nny other ta.r consequrraes re,qarding rhe Bnnds. INTEREST ON THE 2017 SER/ES B
BONDS /S NO? EXCLUD£D FROM GROSS lNfOME fOR FED€RAL MCOME TAX PURPOSES. For a mnrr to+nptete discussinn aj rhe rar a.rpects, sre "L.EGAL
MATT�RS Ta,� Mattrrs.
SiJCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
$ ► $ t
Tax Allocatioa Refunding Bands Taxable Tax Allocation Refunding Bonds
201'I Series A 2017 Series B
Dattd: Date of Detivery
Due: October I as showa on the inside covec pages
Proceeds from the sale af the Successor Agency to the Palm Desert Redevelopmznt Agency (the "Successor Agency") Tax Allocation
Refunding Bonds, 2017 5eries A Bonds {the "2�17 Series A Bonds") and ?azable Tax Atlocation Refunding Bonds, 2017 Series B Bonds (the "2Q17
Series B Bonds," and rogether with the 2417 Series A Bonds, the "Bonds"), will be used to refinance certain outstandutg obligations of che fom�er Palm
Descrt Redaveloprnent Agency (the "Former Ageacy").
'I'he Bonds witl be issued under an Indencure o! Trust dated as of lanuary l, 2017 (the "Indentun:"), by and between the Successor Agenc} and
U.S. Bank National Association, as uustee {the `"(-rustee"). The Bonds are special obligations of Ihe Successor Agency a�d are payable solely kom and
s�ured by a p{edge of ce�tain Tax Revenues, as described in the OfFiciat Statement, and a pledge of amouncs in certain funds and accounts estabiished
under the Indenture (s� "SECURfI'Y FOR THE 64NDS" and "RtSK FACTORS"}.
Interest on the 9onds is payable semiannually on each April 1 and October i, commencing Apcil 1, 2Q17, unXil maturity (see "THE
BONDS - General Pravisions"). The Bonds arc subject ro optional redemption and mandarory sinking account redemption prior to maturity, 3ee "THE
BONDS - Redempiion "
7'he Bonds will be issued in book-entry only form, initially registered in the nanx of Cede & Co., as nominec of The Depository Trust
Company, IVew York, New York ("DTC"). Purchasen oi the Bonds will not ceceive ceetificates representing their i�temsts in tha Boods. Payments of the
principal oE, premium, if any, and interest on the Bonds will be made to D7'C. which is obligated in turn to remit such principal, premium, if any, and
intetest to its DTC Participants for subsequent disbursement to the beneficia! owners of the Bonds.
'ilse Bonds do not constitute a debt or liability of the City of Palm Desert, the County of Riverside, Ihe State of Califomia a of a�ty of its
political subdivisions, other than the Sutcessor Age�y. 'ihe Successor Agency shall only be obligated to pay the principal of dm Bwids, or relared
interest, Erom the funds described in the Official Statement, and neither the faith and credit nor the taxing power of the City of Patm Desert, the Counry of
Riverside, the State of California or any of its political subdivisions is pledged to the payment of the principal ot' or the interest oa the Sonds. The
Successor Agertcy has no taxing power.
The Successor Agency has applied for s municipnl bond insurance policy and a dc:bt ucvice rcserve insuranc.e puGcy to sati�fy thc Reserve
Reyuirement for tfie BoaQs and will decide whether to purchase eithcr of such policies in connection with the ofFering of the 8onds. Such infortnation will
bc incluskd in 1he Official Statement.
The cover page eontains ceetain information for quick reference only. It is not a summary of the issues. Potential iovesmrs must read d�e enure
Official Statement to obtain inlomiation essential to the making of an inforn�ed investment decision. See "RiSK FAC'I'pRS" for a discussion o( s{�ecial
risk factors that should be considemd in evaluating the inveshnent quality of the Bonds.
The Bonds am being offered when, as and if issued, subject to the approval as to their legaliry by Ri�hards Watsoa & Gershon. A Professiona!
Corporation, Los Angeles, Califomia Ce�tain legal matters will also be Qassed on for the Successor Agency by Best Best Bc Krieger LLP, Rive�side.
California, as Disclosure Counsel, and by Rich�rds Watson & Cershon. A Professional Corporarion, Los Mgeles, Califomia, as General Counsel w the
Succassor Ageacy. Certain legaJ matters will be passed on for the Underwriter by its counset, Stradling Yocea Catfson & Rauth, A Professional
Cotporadon, Newport Beach, Catifarnia. It is anticipated that the Bonds will be available for delivery through tlie facilities of The [kpository 1'rust
Campany on or about lanuary _. 2017.
oec�a: , zoi�.
STIFEL
* Pceliminary, subject co change.
RESOLUTION NO. SA-RDA 062
Maturity Date
(October 1)
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
$ �
Tax Allocation Refunding Bonds
2017 Series A
MATURITY SCHEDUI,F.
Principal
Amount Interest Rate Yield Price
�l. Term Bond Maturing . 20_ Yicld
$ T
Taxable Tax Allocation Refunding Bonds
2017 Series B
Maturity Date
(October 1)
�
Principal
Amount Interest Rate Yield
"I� Term Bc�nd Maturing , 20_ Yicld
CUSIP+{
�/r. Pricc: , CUSIPtt:
Price CUSIP`'
�1�, Price: , CUSIp�t:
Prcliminary, suhjcct to change.
" Copyright 2017, Amcrican Bankers Association. CUSIPOO is a registered trademark of thc Amcrican Bankcrs
Association. CUSIP data containcd in the Oflicial Statcment is providcJ by CUSIP Gluhal Services Bureau, operated by
Standard & Poor's. This data is not intended to crcate a databasc and docs not serve in any way as a substiwte for CUSIP
Glohal Scrviccs. CUSIP numbers have been assigned by an independent company not aftiliated with the Sucecssor Agency
and are included solely for the convenience nf the holders c�f the Bonds. None of the Successor Agency, the Fin�ncial
Advisor or the Underwriter takes any responsibility fc�r the selection or uses of these CUSIP numbers, and no representaticin
is madc as to their correctness on the Bonds or as included in the Official Statement. The CUSIP number for a specific
maturity is subject to being changed after the issuance oF the Bonds as a result of various suhsequent actions including, hut
not limi�cd tc�, a refunding in whole or in part or as a result of the procurement of secondary market portfolio insurance or
other similar enhancement hy investc�rs that is applicable to all or a portion of certain maturities of thc Bonds.
RESOLUTION NO. SA-RDA 062
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
CITY COUNCIL AND SUCCESSOR AGENCY GOVERNING BOARD
Jan Harnik, Mayor`
Sabby Jonathan, Mayor Pro Tem*
Kathleen Kelly, Council Member-elect
Gina Nestande, Council Member-elect
Susan Marie Weber, Council Member
SUCCESSOR AGENCY/CITY STAFF
Lauri Aylaian, Executive Director/City Manager
Janet Moore, Finance Officer/Finance Director
Veronica Tapia, Senior Management Analyst
Rachelle D. K►assen, Secretary/City Clerk
PROFESSIONAL SERVICES
Bond Counsel
Richards Watson & Gershon, A Professional Corporation
Los Angeles, California
Disclosure Counsel
Best Best & Krieger LLP
Riverside, California
Municipal Advisor
Del Rio Advisors, LLC
Modesto, California
Fiscal Consultant
Keyser Marston Associates, lnc.
Los Angeles, California
Trustee and Escrow Agent
U.S. Bank National Association
Los Angeles, California
Veritication Agent
Grant Thornton LLP
Minneapolis, Minnesota
' Suhject to City Council rcorganization after election ccnitication on December 8, 2016.
RESOLUTION NO. SA-RDA 062
GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT
No Ojfering May Be Made Except by this O�cia! Statement. No dealer, broker, salesperson or other person has been authorizcd
to give any information or to make any representations with respect to the Bonds other than as contained in this Official
Statcment, and if given or made, such oiher information or representation must not be rclicd upon as having been authorized.
No UnlawJu! Offers or Solicilalions. This Official Statement does not constitute an o(fer to sell or the solicitation of an offer to
buy in any state in which such offer or solicitation is not authorizeJ �r in whieh the person making such c�ffer or solicitation is not
qualiticd to do so or to any person to whom it is unlawful to make such of'fcr or solicitation.
Effective Dale. This Official Statement speaks only as of' its date and the information and expressions of opinion contained in this
Official Statement are subject to change without notice. Neilher the dclivery of this Of'ficial Statcment nor any sale of the Bonds
will, under any circumstances, crcate any implication that there has been no change in the affairs af the Successor Agency or the
Redevelopment Project since the date o(this Official Statement.
Use of this Official Statement. This Official Statement is submittcd in connection with the sale of thc Bonds referrcd to in this
Off'icial Statement and may not be reproduccd or used, in whole or in part, for any other purpose. This Official Statement is not e
contract with the purchasers of the Bonds.
Preparalion of this OJficial Statement. The information contained in this Oft"icial Statement has bccn obtained from sources that
are believed to be reliable, hut this information is not guaranteed as to accuracy or completeness. The information and expressions
of opinions in the Official Statement are subject to change without notice and neither the delivery of this Ofl"icial Statement nor
any sale of Bonds shall, under any circumstances, create any implication that there has becn no change in the affairs of the
Successor Agency since its date. This Official Statement is submitted in connection with the sale of the Bonds and may not be
reproduced or used, in whole or in part, for any other pur�se, unless authorized in wnting by the Successor Agency. All
summaries of the Bonds, the Indenture and other documents, are made subject ta the provisions of such documents and do not
purport to be complete statements oC any or all of such provisic>ns. Reference is hereby made to such documents on file with the
Successor Agency for fuRher information. See "INTRUDUCTION - Summary Not Definitive."
The Underwritcr has provided the following sentence for inclusion in this Officia! Statcment: The Underwriter has reviewed thc
information in this Official Statement in accordance with, and as part of, its res�nsibilitics to inv�stors under the fedcral
securities laws as applied to thc facts and circumstances of this transaction, but the Underwnter docs not guarantee the accuracy or
completeness of such information.
Stabilization ojand Changes to Offering Prices. The Underwriter may overallot or takc other steps that stabilize or maintain thc
market price of the Bonds at levels above that which might otherwisc prevail in the open market. [( commenccd, the Underwriter
m�►y discontinue such markct stabilization at any time. The Undenvriter may offer and sell the Bonds t� certain dealcrs, dealer
banks and banks acting as agent at prices lower than the public offering priccs stated on the inside cover paees of this Official
Statement, and those public offerine prices may be changcd from time to time by the Undcrwriter.
Bonds are Exeinpt from Securities Laws Registration. Thc Bcmds have not been registcrcd undcr the Securi[ies Act of 1933, as
amended, or the Securitics Exchange Act of 1934, as amcnded, in reliance upon exemptions for thc issuance and sale of municipal
securities providcd under Section 3(a)(2) of the Securities Act of 1933 and Section 3(a)(12) of the Securities Exchange Act of
1934.
Estimates and Projections. Certain statcments included or incorporated by reference in this Official Statement constitute
"forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section
21E of the United Statcs Securities Exchange Act of 1)34, as amended, and Section 27A of the United States Securitics Act of
1933, as amended. Such statcmcnts are generally identifiablc by the terminology used s�ch as "plan:' "expect;' "estimate,"
"budget" or other similar words.
THE ACHIF,VF.MENT O�' CERTAIN RF.SUI,TS OR OTHER EXPBCTATIO�IS CO:VTAINED IN SUCH FORWARD-
LOOKING STATEMENTS INVOI,VE KNOWN AND UNK1�OWlV RISKS, UNCERTAINTIES AND OTHER
FACTORS WHICH MAY CAUSE ACTUAL RESUI,TS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE
MATERIALLY DIFFERENT FROM ANY FUTURF. RESULTS, PERFORMANCE OR ACHIEVEMENTS
EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. WHILE THE SUCCESSOR AGENCY
HAS AGREED TO PROVIDE CERTAIN ON-GOING FINANCIAL AND OTHER DATA PURSUANT TO A
CONTINUING DISCLOSURE CERTIFICATE (SEE "CONCI.UDING INFORMATION — Continuing Disclosure").
THE SUCCESSOR AGENCY DOF,S NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THOSE FORWARD-
LOOKING STATEMENT5 IF OR WHF,N 1TS EXPECTATIONS, OR EVENTS, CONDITIONS OR
CIRCUMSTANCES ON WHICH SUCH STATEMENTS AIt� BASED OCCUR.
We6site. The City of Palm Dcsert maintains an Intcrnct website, hut the information on the wehsite is not incorporated in this
OfCicial Statement.
RESOLUTION NO. SA-RDA 062
TABI.E OF CONTENTS
INTRODUCTION .................................................. I
The Successor Agency and the Former
Agency......................................................... 1
TheCity ............................................................. 2
Authority and Purpose ....................................... 2
Tax Allocation Financing Under the
Dissolution Act ............................................ 4
The Redevelopment Project Areas .................... 4
Security for the Bonds ....................................... 5
Municipal Bond Insurance ................................ 6
LegalMatters .................................................... 6
Professional Services ........................................ 6
Offering of the Bonds ........................................ 6
Summary Not Definitive ................................... 7
THE FINANCING PLAN ...................................... 8
The Refunding Plan ........................................... 8
Estimated Sources and Uses of Funds ............ ]0
TH[: BONDS .....................................................:.. 11
General Provisions .......................................... I I
Redemption..................................................... 12
Scheduled Debt Service on the Bonds ............ 1S
SECURITY FOR THE BOIVDS .......................... 16
Tax Allocation Financing ................................ 16
Tax Revenucs .................................................. 16
Pledged Tax Revenues .................................... 1?
Redevelopment Property Tax Trust
Fund........................................................... 17
Recognized Obligation Payment
Schedules................................................... 19
Reserve Account ............................................. 21
No Additional Dcbt Other Than
Refunding Bonds ....................................... 21
PROPERTY TAXATION iN
CALIFORNIA ......................................... 22
THE SUCCESSOR AGEIVCY ............................. 24
Government Organization ............................... 24
Successor Agency Powers ............................... 25
Uissolution Act Milcstones ............................. 2S
Successor Agency Accounting Records
and Financial Statements ........................... 25
Stipulation Agreement .................................... 26
Plan Limitations .............................................. 27
THE PROJECT AREAS ...................................... 28
Description of the Project Areas ..................... 28
LandUse ......................................................... 29
Assessed Valuations and Tax Revenues ......... 30
Major Taxpayers ............................................. 31
Assessment Appeals ........................................ 32
Yass-Through Agrecmcnts .............................. 32
Statutory Tax Sharing Payments ..................... 33
Outstanding Indebtedness ................................ 33
TAX REVENUES AND DEBT SERVICE
COVERAGE ............................................ �i4
RISK I=ACTORS ..................................................38
Factors Which May Affect Tax
Revenues.................................................... 38
LEGAL MATTERS ..............................................42
Enforceability of Remedies .............................42
Approval of Legal Proceedings .......................43
TaxMatters ......................................................43
No Litigation ...................................................48
CONCLUDING tNFORMATION .......................48
Ratings on the Bonds .......................................48
The Municipal Advisor ....................................48
Continuing Disclosure .....................................48
Underwriting.................................................... 49
Additional Information ....................................49
References.......................................................49
Execution......................................................... 49
APPENDIX A- SUMMARY OF CERTAIN
PROVISIONS OF THE
INDEIVTURE ......................................
APPEND[X B- CITY OF PALM DESERT
INFORMAT(ON .................................
APPENUIX C - FISCAL CONSULTANT'S
A- i
:
REPORT................................................ C-1
APPENDIX D- CITY OF PALM DESERT
AUDITED FINANCIAL
STATEMENTS FOR THE FISCAL
YEAR ENDED JUNE 30, 2015............ U-I
APPENDIX E- FORM OF CONTIIVUIIVG
DISCLUSURE CERTIFICATE............ E-I
APPENll1X F- PROPOSED FORMS OF
BOND COUNSEL OPiNIONS ..............F-1
APPENDIX G - THE BOOK-ENTRY
SYSTEM...............................................G-1
�
RESOLUTION NO. SA-RDA 062
REGIONAL MAP
[TO COME]
RESOLUTION NO. SA-RDA 062
MAP OF PROJECT AREAS
[TO COME]
RESOLUTION NO. SA-RDA 062
OFFICIAL STATEMENT
SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
TAX ALLOCATION REFUNDING BONDS
$ �
Successor Agency to the Palm Desert
Redevelopment Agency
Tax Allocation Refunding Bonds
2017 Series A
$ '
Successor Agency to the Palm Desert
Redevelopment Agency
Taxable Tax Allocation Refunding Bonds
2017 Series B
This Official Statement, which includes the cover page, inside cover pages and appendices (the "Official
Statement"), is provided to fumish certain information concerning the sale of the Successor Agency to the Palm
Desert Redevelopment Agency Tax Allocation Refunding Bonds, Series 2017 A(Tax-Exempt) ("2017 Series A
Bonds") and Taxable Tax Allocation Refunding Bonds, 2017 Series B Bonds (Federally Taxable) ("2017 Series
B Bonds," and together with the 2017 Series A Bonds, the "Bonds").
INTRODUCTION
This Introdcrction contains only a brief description of this issue and does not purport to be complete.
The Introductinn is subject in ull respects tv more complete informution in the entire Officiul Statement und the
offering of the Bonds to patential investors is made nnly by meuns of the entire Officiul Stutement und the
documents summarized in the Officia! Statement. Potential investors must reud the entire O�cia! Statement to
obtuin infvrmation essential to the making of an informed investment decision (see "R/SK FACTORS"). Fvr
definitions of certain capitali<,ed terms used in the Ofj�tcia( Statement and not otherwi.se def'►ned, and the terms
reluting to the Bonds, see the summary incli�ded in APPENDIX A-"SUMMARY OF CERTAIN PROVISIONS
OF THE INDENTURE. "
The Successor Agency and the Former Agency
The Palm Desert Redevelopment Agency (the "Former Agency") was established in 1974 by the City
Council (the "City Council") of the City of Palm Desert (the "City") pursuant to the Community Redevelopment
Law (the "Redevelopment Law"), constituting Part 1 of Division 24 (commencing with Section 33000) of the
Health and Safety Code of the State of California (the "State"). In lune 2011, Assembly Bill No. 26 ("AB Xl
26") was enacted as Chapter 5, Statutes of 201 1, together with a companion bill, Assembly Bill No. 27 ("AB X1
27"). A lawsuit was brought in the California Supreme Court, California Redevelopment Association, et al. v.
Matosantos, et al., 53 Cal. 4th 23 I(Cal. 2011), challenging the constitutionality of AB X 1 26 and AB X 1 27. In
its December 29, 20l 1 decision, thc California Supreme Court largely upheld AB X 1 26, invalidated AB X 1 27,
and held that AB X 1 26 may be severed from AB X1 27 and enforced independently. As a result of AB X 1 26
and the decision of the California Supreme Court in the California Redevelopment Association case, as of
February 1, 2012, all redevelopment agencies in the State were dissolved, including the Former Agency, and
successor agencies were designated as successor entities to the former redevelopment agencies to expeditiously
wind down the affairs of the former redevelopment agencies.
The primary provisions enacted by AB X l 26 relating to the disso(ution and wind down of former
redevelopment agency affairs are Parts 1.8 (commencing with Section :i4161) and 1.85 (commencing with
Section 34170) of Division 24 of the Health and Safety Code of the State. There have been multiple
amendments to Parts 1.85 since its original enactment, including those pursuant to Assembly Bill No. 1484
("AB 1484"), enacted in June 2012 as Chapter 26, Statutes of 2012, and Senate Bill No. 107 ("SB 107") enacted
in September 2015, as Chapter 325, Statutes of 2015. The provisions of Parts 1.8 and 1.85 as amended, is
� Preliminary, subject to change.
RESOLUTION NO. SA-RDA 062
referred to in this Official Statement as the "Uissolution Act." The Redevelopment Law, as amended by the
Uissolution Act, is sometimes referred to in the Official Statement as the "Law."
Pursuant to Sec[ion 34173 of the Dissolution Act, the City Council adopted Resolution No. 201 1-76 on
August 2S, 2011, electing for the City to serve as the Successor Agency to the Palm Uesert Redevelopment
Agency (the "Successor Agency"). Since the February 1, 2012 dissolution of the Former Agency, the Successor
Agency was established. The Successor Agency is governed by a five-member Board of Directors consisting of
the Mayor and the members of the City Council. The Mayor acts as the chair of the Successor Agency. See
"THE SUCCESSOR AGENCY."
Section 34173(g) of the Dissolution Act expressly affirms that the Successor Agency is a separate
public entity from the City, that the two entities shall not merge, and that the liabilities of the Former Agency
will not be transferred to the City nor will the assets of the Former Agency become assets of the City. See "THE
SUCCESSOR AGENCY."
The City
The City of Palm Desert (the "City") is located in the County of Riverside (the "County") within the
area known as the Coachella Valley. The City is situated approximately midway between the cities of Indio and
Palm Springs, 1 17 miles east of Los Angeles, 1 18 miles northeast of San Diego and 515 miles southeast of San
Francisco. According to the State Department of Finance, the City population as of January 1, 2U16 was
approximately 49,355. The Bonds are not an obligation of the City. For certain information with respect to the
City, see APPENDIX B—"CITY OF PALM DESERT INFORMATION."
Authority and Purposc
The Bonds are being issued pursuant 10 the Constitution and laws of the State, including Article i 1
(commencing with Section 53580) of Chapter 3 of PaR 1 of Division 2 of Title S of the Government Code of the
State (the "Refunding Law"), the Law and an Indenture dated as of January l, 2017 (the "Indenture") by and
between the Successor Agency and U.S. Bank National Association, as trustee (the "Trustee").
The Agency entered into certain loan agreements (the "Prior Loans") with the Palm Desert Financing
Authority (the "Authority") to finance and refinance redevelopment projects of the Former Agency. The
Authority issucd bonds to fund such loans. The 2017 Series A Bonds are being issued to prepay certain of the
Prior Loans incurred by the Former Agency and cause a corresponding defeasance of the following bonds issued
by the Authority (collectively, the "2017 Series A Refunding Bonds"):
• $22,07U,000 Tax Allocation Refunding Revcnue Bonds (Yroject Area No. l, As Amended) 2002 Series
A(the "PA 1 2002 Serics A Bonds"), which arc outstanding in the principal amount of �22,070,000;
• $19,000,000 Tax Allocation Revenue Bonds (Project Area No. 1, As Amended) Scries 2003 (the "PA I
Series 2003 Bonds"), which are outstanding in the principal amount of $12,660,000;
• $24,945,000 Tax Allocation Refunding Revenue 8onds (Project Area No. 1, As Amended) 2004 Scries
A(the "PA 1 2004 Serics A Bonds"), which are outstanding in the principal amount of $12,770,000;
• $17,310,000 Tax Allocation Refunding Revenue Bonds (Project Area No. 2) 2002 Series A(the "PA 2
2002 Series A Bonds"), which are outstanding in the principal amount of $6,815,000;
• $15,745,000 Tax Allocation Revenue Bonds (Project Area No. 2), Series 2003 but solely: (i) $169,400
of the principal maturing on August 1, 2023, (ii) $176,176 of the principa) maturing on August 1, 2024,
(iii) $481,096 of the principal maturing on August I, 2026, and (iv) $2,221,560 of the principal
mawring on August 1, 2033 (the "PA 2 Series 2003(A) Bonds"); and
2
RESOLUTION NO. SA-RDA 062
• $11,020,000 Tax Allocation Revenue Bonds (Project Area No. 4) Series 1998 (the "PA 4 Series 1998
Bonds"), which are outstanding in the principal amount of $6,670,000.
The 2017 Series B Bonds are being issued to prepay certain of the Prior Loans incurred by the Former
Agency relating to the Authority's and cause a corresponding defeasance of the following bonds issued by the
Authority (collectively, the "2017 Series B Refunded Bonds"):
� $37,780,000 Tax Allocation Revenue Bonds (Project Area No. 1, As Amended) 2006 Series A(the "PA
1 2006 Series A Bonds"), which are outstanding in the principal amount of $37,380,0�0;
•$15,745,000 Tax Allocation Revenue Bonds (Project Area No. 2), Series 2003 but solely: (i) $705,600
of the principal maturing on August ], 2023, (ii) $733,824 of the principal maturing on August 1, 2024,
(iii) $2,003,904 of the principal maturing on August 1, 2026, and (iv) $9,253,440 of the principal
maturing on August i, 2033 (the "PA 2 Series 2003(B) Bonds");
•$41,340,000 Tax Allocation Refunding Revenue Bonds (Project Area No. 2), 2006 Series A(the "PA 2
2006 Series A Bonds"), which are outstanding in the principa) amount of $36,510,000;
•$16,936,094.60 Subordinate Tax Allocation Revenue Capital Appreciation Bonds (Project Area No. 2)
2006 Series D(the "PA 2 2006 Series D Bonds"), which are outstanding in the principal amount of
$16,922,514� �';
•$4,745,000 Tax Allocation Revenue Bonds (Project Area No. 3), Series 2003 (the "PA 3 Series 2003
Bonds"), which are outstanding in the principal amount of $3,325,000;
• $11,915,000 Tax Allocation Revenue Bonds (Project Area No. 3), 2006 Series A(the "PA 3 2006 Series
A Bonds"), which are outstanding in the principal amount of $10,695,000;
• $383,659.75 Tax Allocation Revenue Capital Appreciation Bonds (Project Area No. 3) 2006 Series B
(the "PA 3 2006 Series B Bonds"), which are outstanding in the principal amount of $670,857���;
• $2,760,866.35 Subvrdinate Tax Allocation Revenue Capital Appreciation Bonds (Project Area No. 3)
2006 Series C(the "PA 3 2006 Series C Bonds"), which are outstanding in the principal amount of
$4,362,076" �;
• $15,695,000 Tax Allocation Revenue Bonds (Project Area No. 4), Series 2001 (the "PA 4 Series 2001
Bonds"), which are outstanding in the principal amount of $1 1,3�5,000;
. $14,610,000 Tax Allocation Refunding Revenue Bonds (Project Area No. 4) 2006 Series A(the "PA 4
2006 Series A"), which are outstanding in the principal amount of $10,620,000; and
• $4,633,089.30 Tax Allocation Revenue Capital Appreciation Bonds (Project Are No. 4) 2006 Series B
(the "PA 4 2006 Series B Bonds"), which are outstanding in the principal amount of $7,271,343�"; and
See `"I'HE FINANCING PLAN."
Following the issuance of the Bonds, the following tax allocation bonds of the Former Agency will
remain outstanding and payable from Tax Revenues on a senior basis to the Bonds:
• $32,600,000 Tax Alloca[ion Refunding Revenue Bonds (Project Area No. 1, As Amended) 2007 Series
A(the "PA 1 2007 Series A Bonds" or the "Senior Bonds"), which are outstanding in the principal
amount of $7,250,000 with a iinal maturity date of April 1, 2018.
� Bascd c�n a January 17, 2017 redcmption datc.
RESOLUTION NO. SA-RDA 062
The loan agreement which relates to the Senior Bonds is referred to as the "Senior Loan Agreement."
The loan described in the Senior Loan Agreement is referred to as the "Senior Loan." See "SECURTTY FOR
THE BONDS" and "THE PROJECT AREAS - Outstanding Indebtedness."
Additionally, certain pass-through payments pursuant to negotiated tax sharing agreements and tax
sharing statutes are payable on a senior ba5is to the PA 1 2007 Series A Bonds and the Bonds. See "THE
PROJECT AREAS — Pass-Through Agrcements" and "- Statutory Tax Sharing Payments."
Tax Allocation Financing Under the Dissolution Act
Prior to the enactment of AB X1 26, the Redevelopment Law authorized the financing of redevelopment
projects through the use of tax increment revenues. This method provided that the taxable valuation of the
property within a redevelopment project area on the property tax roll last equalized prior to the effective date of
the ordinance which adopted the redevelopment plan (or with respect to a later added component area of a
project area, the effective date of the ordinance adopting the amendment to the redevelopment plan) became the
base year valuation. Assuming the taxab{e valuation never drops below the base year level, the Taxing
Agencies, as defined in the Official Statement, thereafter received that portion of the taxes produced by applying
then current tax rates to the base year valuation, and the redevelopment agency was allocated the remaining
portion produced by applying then current tax rates to the increase in valuation over the base year. Such
incremental tax revenues ailocated to a redevelopment agency were authorized to be pledged to the payment of
agency obligations.
Under the Dissolution Act, moneys will be deposited from time to time in a Redevelopment Property
Tax Trust Fund (the "Redevelopment Property Tax Trust Fund" or "RPTTF") held by a county auditor-
controller with respect to a successor agency, which are equivalent to the tax inerement revenues that were
formerly allocated under the Redevelopment Law to the redevelopment agency and formerly authorized under
the Redevelopment Law to be used for the financing of redevelopment projects using current assessed values on
the last equalized roll on August 20 each year. See "SECURITY FOR THE BONDS - Tax Allocation
Financing" for additional information.
The Uissolution Act provides that any bonds to be issued by the Successor Agency will be considered
indebtedness incurred by the Former Agency, with the same (egal effect as if the bonds had been issued prior to
the effective date of AB X1 26, in full conformity with the applicable provision of the Redevelopment Law that
existed prior to that date, and wil! be included in the Successor Agency's Recognized Obligation Payment
Schedules (each a"Recognized Obligation Payment Schedule" or "ROPS") in accordance with the requirements
of the Dissolution Act. See "SECURITY FOR THE BONDS Recognized Obligation Payment Schedules."
The Redevelopment Project Areas
There are four redevelopment project areas within the City which are identified below:
• Project Area No. l, as amended ("PA I" or "Project Area No. 1")
� Project Area No. 2("PA 2" or "Project Area No. 2")
• Project Area No. 3("PA 3" or "Project Area No. 3")
• Project Area No. 4("PA 4" or "Project Area No. 4")
PA 1, PA 2, PA 3 and PA 4 are collectively hereinafter refe�red to as the "Project Areas," or each
individually a"Project Area." The Project Areas contain approximately 11,771 acres, whieh comprises
approximatcly 68�Ic of the [otal acres in thc City.
See "THE PROJECT AREAS" and "THE SUCCESSOR AGENCY" for additional information.
RESOLUTION NO. SA-RDA 062
Security for the Bonds
For the security of the Bonds, the Successor Agency grants a pledge of and lien on all of the Tax
Revenues. "Tax Revenues" are defined under the Indenture as:
(a) All property taxes deposited from time to time into the RPTTF (consisting of all property tax
revenues that would have been allocated to the Former Agency pursuant to subdivision (b) of Section 16 of
Article XVI of the Constitution of the State and that are deposited and administered in accordance wi[h the
provisions of the Dissolution Act), but excluding the following amounts: (i) administrative costs of the County
Auditor-Controller deducted as required by California Health and Safety Code Section 34183(a); (ii) amounts
payable to affected taxing entities pursuant to the Law (including payments under Califomia Health and Safety
Code Sections 33676, 33607.5 or 33607.7 and the Pass-Through Agreements, as described in "THE PROJECT
AREAS — Pass-Through Agreements"), except to the extent such payment to a taxing entity has been
subordinated to the Bonds, (iii) the Housing Portion (as hereinafter defined), and (iv) amounts repayable by the
Successor Agency with respect to the Senior Loan (including any reimbursement to the bond insurer for draws
on the related bond insurance policy and the debt service reserve surety bond) pursuant to the terms of the
Senior Loan Agreement.
(b) In the event that the provisions of the Dissolution Act are invalidated because of a final judicial
decision or a change in law, such that property tax revenues described above are no longer deposited into the
RPTTF, then Tax Revenues shall mean al) revenues derived from taxes levied on properties that would have
been allocated to the Former Agency pursuant to Section l6(b) of Article XVI of the California Constitution,
subject to the exclusions stated in paragraph (a) above, as such exclusions are then in effect pursuant to the law
of such time.
"Housing Portion" is defined in the Indenture as the portion of the property tax revenues required to be
deposited by the County Auditor-Controller into the RPTTF that is equal to the dollar amount (the "Housing
Set-Aside") that the Former Agency would have been required to deposit into the Low and Moderate Income
Housing Fund (the "Housing Fund") pursuant to Sections 33334.2 and 33334.3 of the Redevelopment Law, if
the Former Agency had not been dissolved and such provisions were applicable in each fiscal year that the
Bonds remain outstanding.
The Dissolution Act authorizes refunding bonds, including the Bonds, to be secured by a pledge of
moneys deposited from time to time in the RPTTF. The Dissolution Act has eliminated the Housing Fund and
the requirement to deposit the Housing Set-Aside into such fund. The moneys deposited into the RPTTF now
include all property tax revenues, including amounts which would have been attributable to the Housing Set-
Aside. With respect to the moneys deposited into the RPTTF, any amounts due under the Pass-Through
Agreements and pursuant to tax sharing statutes will be paid prior to the payment of debt service on the Bonds;
provided, however, see discussion under "SECURITY FOR THE BONDS — Redevclopment Property Tax Trust
Fund — Disbursement from Reclevelopment Property Tax Trc�st Fund" regarding the treatment of subordinated
pass-through payments in the event that there are insufficient Tax Revenues to make a debt service payment on
the Bonds.
On or about the same time that the Bonds will be issued, the Successor Ageney plans to issue two other
series of bonds (the "2017 Housing Refunding Bonds") to refund certain other outstanding debt incurced by the
Former Agency. The 2017 Non-Housing Refunding Bonds, upon issuance, will be secured by a lien and pledge
on moneys deposited into the RPTTF in an amount equal to the Housing Portion.
DISCUSSIONS HEREIN REGARDING TAX REVENUES NOW REFER TO THOSE MONEYS
DEPOSITED BY THE COUNTY AUDITOR-CONTROLLER INTO THE REDEVELOPMEIVT PROPERTY
TAX TRUST FUND EQUAL TO SUCH TAX REVENUES.
See "PROPERTY TAXATION IN CALIFORNIA" and "THE PROJECT AREAS - Pass-Through
Agreements" and "- Statutory Tax Sharing Payments."
RESOLUTION NO. SA-RDA 062
The Successor Agency may not issue additional bonds payable on a basis senior ro the Bonds. The
Successor Agency may issue additional bonds payable from Tax Revenues on parity with the Bonds ("Parity
Obligations"), but solely [o refinance the Bonds if certain condi[ions are satisfied. See "SECURITY FOR THE
BOIVDS - No Additional Debt Other Than Refunding Bonds."
The Successor Agency has covenanted to include in each ROPS the amounts required for debt ser��ice
payments for the Bonds in the manner prescribed in the Indenture, and to transfer Tax Revenues to the Trustee
for deposit into the Debt Service Fund at the times required by the Indenture. See "SECURiTY FOR THE
BONDS."
The Bonds do not constitute a debt or liability of the City, the County of Riverside (the "County"),
the State or of any of its political subdivision, other than the Successor Agency. The Successor Agency
shall only be obligated to pay the principal of the Bonds, or related interest, from the funds described in
the Official Statement, and neither the faith and credit nor the taxing power of the City, the County or
the State pledged to the payment of the principal of or the interest on the Bonds. The Successor Agency
has no taxing power.
Municipal Bond Insurance
The Succestor Agency has upplied for a municipal bond insurance policy and will decide whether to
purchase such policy in connection with the offering of the Bonds. Such information will be included in the
Official Statement.
Legal Matters
The Bonds are being offered when, as �nd if issued, subject to the approval as to their legality by
Richards Watson & Gershon, A Professional Corporation, Los Angeles, California, as Bond Counsel. Bond
Counsel's proposed approving opinions, and certain tax consequences incident to the ownership of the Bonds,
including certain exceptions to the tax treatment of interest, are described more fully under the heading
"LEGAL MATTERS." Certain legal matters will be passed on for the Successor Agency by Best Best &
Krieger LLP, as Disclosure Counsel, by Richards Watson & Gershon, A Professional Corporation, Los Angcles,
California, as General Counsel to the Successor Agency, and for the Underwriter by their Counsel, Stradling
Yocca Carlson & Rauth, A Professional Corporation, Newport Beach, California.
Professional Services
U.S. B�nk National Association will act as Trustee with respect to the Bonds.
Del Rio Advisors, LLC, Modesto, California ([he "Municipal Advisor") advised the Successor Agency
as to the financial structure and certain other financial matters relating to the Bonds.
Straddling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, will serve
as Underwriter's Counsel.
Offering of the Bonds
Authority for Issuance. The Bonds are to be issued and secured pursuant to the Indenture, a� authorized
by Resolution Nos. SA-RDA-60 of the Successor Agency adopted on October 13, 2016, respectively, the
Refunding Law and the Law. The Successor Agency's Oversight Board (the "Oversight Board") approved the
action taken by the Successor Agency to refinance the Refunded Bonds on October 17, 2016. The State
Department of Finance approved the Oversight Board action by letter dated December 1, 2016.
�
RESOLUTION NO. SA-RDA 062
Summary Not Definitive
The summaries and references contained in the Official Statement with respect to the Indenture, the
Bonds and other statutes or documents do not purport to be comprehensive or definitive and are qualified by
reference to each such document or statute, and references to the Bonds are qualified in their entirety by
reference to the form thereof included in the Indenture. Copies of these documents may be obtained after
delivery of the Bonds from the Successor Agency at 73510 Fred Waring Drive, Palm Desert, California 92260.
7
RESOLUTION NO. SA-RDA 062
THE FINANCING PLAN
The Refunding Plan
Redemption of Refunded Bonds. On the Closing Date, a portion of the proceeds of each series of the
Bonds will be transferred to the Trustee, as prior trustee, for the Refunded Bonds (the "Prior Trustee") for
deposit into separate escrow accounts (together, the "Escrow Accounts") as provided for each series of
Refunded Bonds, under a certain Non-Housing Bonds Escrow Agreement, dated as of January 1, 2017 (the
"Escrow Agreement") delivered by and among the Successor Agency, the Authority and the Prior Trustee.
Most or all of the amount deposited in the Escrow Account for the 2017 Series A Refunded Bonds,
together with other available moneys, will be invested in Escrow Securities as set forth in the E:scrow
Agreement. The moneys (including those derived from the Escrow Securities) in such Escrow Account are
irrevocably pledged for the payment of the related 2017 Series A Refunded Bonds on their respective date of
redemption as follows:
• the $22,070,000 outstanding PA 1 2002 Series A Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to 100% of the principal amount of the PA 1 2002 Series A Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium; and
• the $12,660,000 outstanding PA I 200:i Series Bonds will be redeemed in full on April l, 2017 at a
redemption price equal to 100% of the principal amount of the PA 1 Series 2003 Bonds to be redeemed
together with accrued interest thereon to the date fixed for redemption, without premium; and
• the $12,770,000 outstanding PA 1 2004 Series A Bonds will be redeemed in full on April l, 2017 at a
redemption price equal to 1009c of the principal amount of the PA 1 2004 Series A Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium; and
• the $6,815,000 outstanding PA 2 2002 Series A Bonds will be redeemed in full on February 1, 2017 at a
redemption price equal to 100�Ic of the principal amount of the PA 2 2002 Series A Bonds to be
redeemed together with accrued interest thereon to the date �xed for redemption, without premium; and
� the $3,048,232 outstanding PA 2 2003(A) Series Bonds will be redeemed in full on February 1, 2017 at
a redemption price equal to 100�1c of the principal amount of the PA 2 2003(A) Series Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium; and
• the $6,670,000 outstanding PA 4 1998 Series A Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to 100% of the principal amount of the PA 4 1998 Series A Bonds to be
redeemed together with accrucd interest thereon to the date fixed for redemption, without premium.
The amount deposited in the Escrow Accounts for the 2017 Series B Refunded Bonds, together with
other available moneys, will be invested in Eurow Securities as set forth in the Escrow Agreement and
irrevocably pledged for the payment of the related 2017 Scries B Refunded Bonds on thcir respective date of
redemption as follows:
the $37,780,000 outstanding PA 1 2006 Serie� A Bonds will be redeemed in full on April l, 2017 at a
redemption price equal to IOO�/c of the principal amount of the PA 1 2006 Series A Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium; and
� the $12,696,768 outstanding PA 2 Series 2003(B) Bonds will be redeemed in full on February 1, 2017 at
a redemption price equal to 100�Ic of the principal amount of the PA 2 Series 2003 Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium; and
RESOLUTION NO. SA-RDA 062
� the $36,510,000 outstanding PA 2 2006 Series A Bonds will be redeemed in full on Febn�ary 1, 2017 at
a redemption price equal to 100% of the principal amount of the PA 2 2006 Series A Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium; and
• the $16,922,514�" outstanding PA 2 2006 Series D Bonds will be redeemed in full on February 1, 2017
at a redemption price equal to the accreted value of such bonds on the date fixed for such redemption,
without premium; and
• the $3,325,000 outstanding PA 3 2003 Series Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to 100�1c of the principal amount of the PA 3 2003 Series Bonds to be redeemed
together with accrued interest thereon to the date fixed for redemption, without premium.
• the $10,695,000 outstanding PA 3 2006 Series A Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to 100% of the principal amount of the PA 3 2006 Series A Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium.
• the $670,857"' outstanding PA 3 2006 Series B Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to the accreted value of such bonds on the date fixed for such redemption,
without premium.
• the $4,362,076�" outstanding PA 3 2006 Series C Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to the accreted value of such bonds on the date fixed for redemption, without
premium.
• the $11,375,000 outstanding PA 4 2001 Series A Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to 100% of the principal amount of the PA 4 2001 Series A Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium.
• the $10,620,000 outstanding PA 4 2006 Series A Bonds will be redeemed in full on April 1, 2017 at a
redemption price equal to 100�Ic of the principal amount of the PA 4 2006 Series A Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium.
• the $7,271,343"' outstanding PA 4 2006 Series B Bonds will be redeemed in fuli on April 1, 2017 at a
redemption price equal to 100�7c of the principal amount of the PA 4 2006 Series B Bonds to be
redeemed together with accrued interest thereon to the date fixed for redemption, without premium.
The 2017 Series A Refunded Bonds and the 2017 Series B ReFunded Bonds are collectively referred to
in this Official Statement as the "Refunded Bonds").
The suf�ciency of the amounts deposited in the Escrow Accounts for such purpose wi11 be verified by
the Verification Agent as described below. The lien of the Refunded Bonds will be discharged, terminated and
of no further force and effect upon the deposit with the Prior Trustee of the amounts required pursuant to the
Escrow Agreement.
The amounts held by the Prior Trustee for the respective Refunded Bonds in the Escrow Accounts are
pledged solely to the payment of amounts due and payable by the Successor Agency with respect to the
Refunded Bonds. The funds deposited in the Escrow Accounts for the Refunded Bonds will not be availabte for
the payment of debt service on the Bonds.
Verifications of Mathematical Computations. Grant Thornton LLP will verify from the information
provided to them the mathematical accuracy as of the date of the closing on the Bonds of (l) the computations
contained in the provided schedules to determine that the cash listed in the schedules prepared by the
� Batied on accretcd value as of an assumcd January 17, 2Q17 redemption datc.
9
RESOLUTION NO. SA-RDA 062
Underwriter, to be held in the Escrow Accounts, will be sufficient to pay, when due, the principal, redemption
premium and interest requirements of the Refunded Bonds, and (2) the computation of yield on the 2017 Series
A Bonds contained in the provided schedules used by Bond Counsel in its determination that the interest with
respect to the 2017 Scries A Bonds is exempt from federal taxation.
Estimated Sources and Uses of Funds
The following is a summary of the anticipated sources and uses of funds relating to the Bonds:
Series A Series B Total
Sourccs of Funds:
Par Amount of Bands $ $ $
Nct Ori�inal Issuc Prcmium/(Ori�inal Issue Discount)
Undcrwriter's Discount
Funds Held for the RefunJed Bonds
TOTAL 50URCES OF FUNDS: � $ $
Uscs of Funds:
Transfcr to Escrow Arcounts
Costs of Issuance�'�
TOTAL USES OF FUNDS:
$ $ $
$ $ $
��� Costs of issuance includc fccs and cxpcnscs of Bund Counscl, thc Municipal Advisor, Disclosurc Coun,cl,
Verification Agent, Trustcc and Escrow Agent, premium for bond insurance (if any), prcmium for debt servirc
reserve insurance policy (if any), costs of printine the Official Statement, rating 1ec and other costs of issuancc
cif the Bonds.
LII;
RESOLUTION NO. SA-RDA 062
THE BONDS
General Provisions
Repayment af the Bonds. The Bonds of each series shall be delivered in fully registered form,
numbered from one upwards in consecutive numerical order, and shall be executed and delivered in integral
multiples of $5,000 and witl be dated as of the date of delivery (the "Closing Date"). Interest on the Bonds is
payable at the rates per annum set forth on the inside cover page of the Officia) Statement. Interest on the Bonds
will be computed on the ba�is of a year consisting of 360 days and twelve 30-day months.
Interest on the Bonds will be payable on each April 1 and October 1, commencing Apri1 1, 2017 (each
an "Interest Payment Date"). The Bonds shall bear interest from the Interest Payment Date next preceding the
date of authentication thereof, unless (a) it is authenticated after the i 5th calendar day of the month preceding an
Interest Payment Date (a "Record Date") and on or bcfore the following Interest Payment Date, in which event
it shall bear interest from such Interest Payment Date, or (b) it is authenticated on or prior to the Record Date for
the first interest Payment Date, in which event it shall bear interest from the Ciosing Date; provided, however,
that if, at the time of authentication of any Bond, interest with respect to such Bond is in default, such Bond
shall bear interest from the Interest Payment Date to which interest has been paid or made available for payment
with respect to such Bond.
Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept
pursuant to the provisions of Indenture, by the person in whose name it is registered, in person or by that
person's du(y authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a
written instrument of transfer. Whenever any Bond or Bonds is surrendered for transfer, the Successor Agency
shall execute and the Trustee shall authenticate and deliver a new Bond or Bonds of the same series and like
tenor, maturity and total maturity amount. The cost of printing any Bonds and any services rendered or
expenses incuned by the Trustee in connection with any such transfer shall be paid by the Successor Agency,
except that the Trustee shall require the payment by the Owner requesting such transfer of any tax or other
governmental charge required to be paid with respect to such transfer. The Trustee shall not be required to
register the transfer or exchange of any Bond during the l5 days preceding any date established by the Trustee
for selection of Bonds for redemption or any Bonds which have matured or been selected for redemption.
Bonds may be exchanged at the Trust Office foc the same aggregate principal amount of the Bond of the
same maturity of other authorized denominations. The cost of printing any Bonds and any services rendered or
expenses incurred by the Trustee in connection with any such exchange shall be paid by the Successor Agency,
except that the Trustee shall require the payment by the Owner requesting such exchange of any tax or other
governmental charge required to be paid with respect to such exchange. No such exchange shall be required to
be made during the IS days preceding any date established by the Trustee for selection of Bonds for redemption
or any Bonds which have matured or been selected for redemption.
The foregoing provisions regarding the transfer and exchange of the Bonds apply only if the book-entry
system is discontinued. So long as the Bonds are in the book-entry system of The Depository Trust Company
("DTC") as described below, the rules of DTC will apply for the transfer and exchange of Bonds.
Book-Entry System. DTC will act as securities depository for the Bonds. The Bonds will be issued as
fully registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other
name as may be requested by an authorized representative of DTC. Interest on and principal of the Bonds will
be payable when due by wire of the Trustee to DTC which will in turn remit such interest and principal to DTC
Participants, which wi11 in turn remit such interest and principal [o Beneficial Owners of the Bonds (see
APPENDIX G-"THE BOOK-ENTRY SYSTEM."). As long as DTC is the registered owner of the Bonds and
DTC's book-entry method is used for the Bonds, the Trustee will send any notices to Bond Owners only to
DTC.
DTC may discontinue providing its services as securitics depository with respect to the Bonds at any
time by giving reasonable notice to the Successor Agency or the Trustee. Under such circumstances, if a
11
RESOLUTION NO. SA-RDA 062
successor securities depository is not obtained, Bonds are required to be printed and delivered as described in
the lndenture. The Successor Agency may decide to discontinue use of the system of book-entry transfers �
through DTC (or a successor securities depository). In that event, the Bonds will be printed and delivered as
described in the Indcnture. -
Redemption
Optional Redemption of the Bonds. The 2017 Series A Bonds maturing on or before October 1, 20_
shall not be subject to optional redemption prior to their maturity. The 2017 Series A Bonds maturing on or
aRer October 1, 20_ shall be subject to redemption as a whole or in part from such maturities as the Successor
Agency shall designate, prior to their maturity at the option of the Successor Agency on any date on or after
October 1, 20_, from funds derived by the Successor Agency from any source, at a redemption price equal to
[ 100] percent of the principal amount of the 2017 Series A Bonds to be redeemed, together with interest accrued
thereon to the date fixed for redemption, without premium.
The 2017 Series B Bonds maturing on or before October l, 20_ shall not be subject to optional
redemption prior to their maturity. The 2017 Series B Bonds maturing on or after Octobcr I, 20_ shall be
subject to redemption as a whole or in part from such maturities as the Successor Agency shall designate, prior
to their maturity at the option of the Successor Agency on any date on or after October 1, 20_, from funds
derived by the Successor Agency from any source, at a redemption price equal to [ 100] percent of the principal
amount of the 2U17 Series B Bonds to be redeemed, together with interest accrued thereon to the date fixed for
redcmption, without premium.
Mandatory Sinking Account Redemption. The 2017 Series A Bonds maturing on October 1, 20_ and
October 1, 20_ are also subject to redemption prior to their stated maturity, in part by lot, from Sinking
Account Installments deposited in the Sinking Account on October 1 of each year commencing October 1, �`�
20_ and October 1, 20_, respectively, at the principal amount thereof and interest accrued thereon to the
date fixed for redemption, without premium, according to the following schedules:
2017 Series A Bonds maturing October 1, 20
Redemption Date Sinking Account
�October 1) Installment
20_ (Maturity)
2017 Series A Bonds maturinQ October 1, 20
Redemption Date Sinking Account
�October 1) Installment
20_ (Maturity)
The 2017 Series B Bonds maturing on October 1, 20_ and October 1, 20_ are also subject to
redemption prior to their stated maturity, in part by lot, from Sinking Account Inscallments deposited in the
Sinking Account on October 1 of each year commencing October 1, 20_ and Uctober 1, 20_, respectively,
at the principal amount thercof and interest accrued thereon to the date fixed for redemption, without premium, %"
according to the following schedules:
12
RESOLUTION NO. SA-RDA 062
2017 Series B Bonds maturine October l, 20
Redemption Date Sinking Account
(October 1) Installment
20_ (Maturity)
2017 Series B Bonds maturine October 1. 20
Redemption Date Sinking Account
(October 1) Installment
20_ (Maturity)
In lieu of redemption of any Term Bond, upon the Successor Agency's written request, the Trustee may
appiy amounts on deposit in the Debt Service Fund or the Sinking Account at any time, for the purchase of such
Term Bonds at public or private sale as and when and at such prices (including brokerage and other charges, but
excluding accrued interest, which is payable from the Interest Account) as the Successor Agency may determine
in its discretion, but not in excess of the principal amount thereof. No Bonds shall be so purchased by the
Trustee with a settlement date more than 60 days prior to the redemption date. The principal amount of any
Term Bonds so purchased by the Trustee in any 12 month period ending 30 days prior to any Principal Payment
Date in any year will be credited towards and will reduce the principal amount of such Term Bonds required to
be redeemed on such Principal Paymeat Date in such year.
Selection of Boncis for Redemptinn. With respect to the redemption of Ouistanding Bonds of a series,
whenever less than all of the Outstanding Bonds of a maturity are called for redemption at any one time, the
Trustee will select the Bonds to be redeemed, from the Outstanding Bonds of such maturity not previously
selected for redemption, by lot; provided, that if less than all of the Outstanding Term Bonds of any maturity are
called for optional redemption, each future Sinking Account Installment with respect to such Term Bonds will
be reduced on a pro rata basis (as nearly as practicable) in integral multiples of $5,000, so that the total amount
of Sinking Account Installment payments (with respect to such Term Bonds) to be made after the optional
redemption will be reduced by an amount equal to the principal amount of the Term Bonds so redeemed, as will
be designated by the Successor Agency to the Trustee in writing.
Notice of' Redemption; Cuncellatron of Redemption. The Trustee, on behalf of the Successor Agency,
will send notice of any redemption to the respective Owners of any Bonds designated for redemption at their
respective addresses appearing on the bond registration books of the Trustee, to the Securities Depository and
the Municipa{ Securities Rulemaking Board (via the Electronic Municipal Market Access System), not more
than 60 days and not less than 30 days prior to the date fixed for redemption; provided that neither the failure of
any Owner to receive any redemption notice sent to such Owner nor any defect in the notice so sent will not
affect the sufficiency of the proceedings for redemption.
The Successor Agency will have the right to rescind any optional redemption by wri[ten notice of
rescission. Any notice of optional redemption will be cancelled and annulled if for any reason funds are not
available on the date ftxed for redemption foc the payment in full of the Bonds then called for redemption.
Neither such cancellation nor lack of available funds will constitute an event of default under the Indenture. The
Trustee will send notice of rescission of such redemption in the same manner as the original notice of
redemption was sent.
13
RESOLUTION NO. SA-RDA 062
So long as DTC is the sole registered owner of the Bonds, notices of redemption (and notices of
cancellation of redemption) wiil be sent to DTC and not to any beneficial owners. See "Book-Entry Only
Systcm."
Effect of Redenrption. From and after the date fixed for redemption, if notice of such redemp[ion will
have been duly given and funds available for the payment of such redemption price of the Bonds so called for
redemption will have been duly provided, no interest will accrue on such Bonds from and after the redemption
date specified in such notice. Such Bonds, or parts thereof redeemed, will cease to be entitled to any lien,
benefit or sccuri[y under the Indenture.
14
RESOLUTION NO. SA-RDA 062
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RESOLUTION NO. SA-RDA 062
SECURITY FOR TNE BONDS
Tax Allocation Financing
Prior to the enactment of the Dissolution Act, the Redevelopment Law authorized the financing of
redevelopment projects through the use of tax increment revenues. First, the assessed valuation of the taxable
property in a project area (or, if applicable, a later added component area), as last equa{ized prior to adoption of
the redevelopment plan (or, as applicable, the adoption of the amendment to the redevelopment plan adding such
component area), was established and became the base roll. Thereafter, except for any period during which the
assessed valuation drops below the base year level, the Taxing Agencies (defined below), on behalf of which
taxes are levied on property within the project area, receive the taxes produced by the levy of the then current
tax rate upon the base roll. Taxes collectcd upon any increase in the assessed valuation of the taxable property in
a project area over the levy upon the base roll could be pledged by a redevelopment agency to the repayment of
any indebtedness incurred in financing the redevelopment project. Redevelopment agencies themselves had no
authority to levy taxes on property.
The Dissolution Act now requires the County Auditor-Controller to determine the amount of property
taxes that would have been allocated to the Former Agency had the Former Agency not been dissolved using
current assessed values on the last equalized roll on August 20, and to deposit that amount in the RPTTF for the
Successor Agency es[ablished and held by the County Auditor-Controller pursuant to the llissolution Act. Such
funds, or portions thereof distributed to the Successor Agency, are deposited by the Successor Agency in its
Recognized Obligation Retirement Fund (the "Recognized Obligation Retirement Fund"). The Dissotution Act
provides that any bonds authorized its terms to be issued by the Successor Agency will be considered
indebtedness incurred by the dissolved Former Agency, with the same legal effect as if the bonds had been
issued prior to effective date of AB X1 26, in full conformity wi[h the applicable provision of the
Redevelopment Law that existed prior to that date, and will be included in the Successor Ageney's ROPS.
Successor agencies have no power to levy property taxes but must receive an allocation of taxes as
described above. See "RISK FACTURS."
Tax Revenues
As provided in the redevelopment plans for the Project Areas (each a"Redevelopment Plan") and
pursuant to Article 6 of Chapter 6 of the Redevelopment Law, and Section 16 of Article XVI of the Constitution
of the State, taxes levied upon taxable property in the Project Areas each year by or for the benefit of the State,
for cities, counties, districts or other public corporations (collectively, the "Taxing Agencies" and each
individually a"Taxing Agency") for fiscal years beginning after the effective date of the ordinance approving
the Redevelopment Plan, will be divided as follows:
(a) To Taxin�A encies: That portion of the taxes which would be produced by the rate
upon which the tax is levied each year by or for each of the Taxing Agencies upon the total sum of the
assessed value of the taxable property in a Project Area as shown upon the assessment roll used in
connection with tf►e taxation of such properiy by such Taxing Agency last equalized prior to the
effective date of the ordinance adopting a Project Area's Redevelopment Plan, or the respective
effective dates of ordinances approving amendments to such Redevelopment Plan that added territory,
as applicable (each, a"base year valuation"), will be allocated to, and when collected will be paid into,
the funds of the respective Taxing Agencies as taxes by or for the Taxing Agencies on all other property
are paid; and
(b) To the Former Agency/Successor A encX: Except for that poriion of the taxes in excess
of the amount identified in (a) above which are attributable to a tax rate levied by a Taxing Agency for
the purpose of producing revenues in an amount sufficient to make annual repayments of the principal
of and the in[eres[ on, any bonded indebtedness approved by the voters of the Taxing Agency on or after
January 1, 1989 for the acquisition or improvement of real property, which portion shall be allocated [o,
and when collected shall be paid into, the fund of [hat Taxing Agency, that portion of the levied taxes
16
RESOLUTION NO. SA-RDA 062
each year in excess of such amount, annually allocated within the redevelopment plan limit, when
collected will be paid into a special fund of the Former Agency/Successor Agency. Section 34183 of the
Dissolution Act effective(y eliminates the Janu�uy 1, 1989 date from this paragraph. Additionally, the
language clarified that effective September 22, 2015, debt service override revenues approved by the
voters for the purpose of suppoRing pension programs, capital projects, or programs related to the State
Water Project, which are not pledged to or needed for debt service on successor agency obligations are
allocated and paid to the entity that levies the override and will noi be deposited into the RPTTF.
Tax revenues generated as set forth under (b) above and allocated to the Successor Agency constitute a
portion of the Tax Revenues, as that term is used in the Official Statement. The Tax Revenues do not include
any override revenues.
Pledged Tax Revenues
For the security of the Bonds, the Successor Agency grants a pledge of and lien on all of the Tax
Revenues. With respect to moneys deposited into the RPTTF, any amounts due under the Pass-Through
Agreements or tax sharing statutes will be paid prior to the payment of debt service on the Bonds; provided,
however, see Redevelopment Property Tax Trust Fund — Disbursement from Redevelopment Property Tax Tru.st
Fund' regarding the treatment of subordinated pass-through payments in the event that there are insufficient Tax
Revenues to make a debt service payment on the Bonds. D[SCUSSIONS HEREIN REGARDING PLEDGED
TAX REVENUES NOW REFER TO THOSE MONEYS DEPOSITED BY THE COUNTY AUDITOR-
CONTROLLER INTO THE REDEVELOPMENT PROPERTY TAX TRUST FUND EQUAL TO SUCH TAX
REVENUES. See "Pledge of Tax Revenues" below and "THE PROJECT AREAS - Pass-Through
Agreements" and "- Statutory Tax Sharing Payments."
The Bonds are special obligations of the Successor Agency. The Bonds do not constitute a debt or
liability of the City, the County, the State or of its political subdivision, other than the Successor Agency.
The Successor Agency shall only be obligated to pay the principal of the Bonds, or the interest thereon,
from the funds described in the Official Statement, and neither the faith and credit nor the taxing power
of the City, the County, the State or any of its political subdivisions is pledged to the payment of the
principal of or the interest on the Bonds. The Successor Agency has no taxing power.
The State Legislature has amended the Dissolution Act several times. The Successor Agency expects,
but cannot guarantee, that the processes for funding of enforceable obligations prescribed by any new legislative
change in the Dissolution Act will not interfere with its administering of the Tax Revenues in accordance with
the Indenture and will effectively result in adequate Tax Revenues for the timely payment of principal of and
interest on the Bonds when due.
Redevelopment Property Tax Trust Fund
Deposits to the Redevelopment Property Tax Trust Fund. Section 34172 of the Dissolution Act
provides that, for purposes of Section 16 of Article XVI of the State Constitution, the RPTTF shall be deemed to
be a special fund of the Successor Agency to pay the debt service on indebtedness incurred by the Former
Agency or the Successor Agency to finance or refinance the redevelopment projects of the Former Agency.
Disbursements from the Redevelopment Property Tax Trust Fund. The Redevelopment Law
authorized redevelopment agencies to make payments to Taxing Agencies to alleviate any financial burden or
detriments to such Taxing Agencies caused by a redevelopment project. The Former Agency entered into
agreements with the Taxing Agencies for this purpose ("Pass-Through Agreements"). Additionally, because of
amendments to the redevelopment plans, there are Statutory Tax Sharing paymcnts with respect to each Project
Area. See "THE PROJECT AREAS - Pass-Through Agreements" and "- Statutory Tax Sharing Payments").
Typically, under the RPTTF distribution provisions of the Dissolution Act, a county auditor-controller is
to distribute funds for each six-month period in the following order specified in Section 34183 of the
Dissolution Act:
17
RESOLUTION NO. SA-RDA 062
(i) �rst, subject to certain adjustments (as described below) for subordinations to the extent
permitted under the Dissolution Act (if any, as described below under "THE PROJECT AREAS - Pass-
Through Agreements" and "- Statutory Tax Sharing Payments") and no later than each January 2 and
June 1, to each local taxing agency and school entity, to the extent applicable, amounts required for
pass-through payments such cntity would have received under provisions of the Redevelopment Law, as
those provisions read on January 1, 201 ], including negotiated pass-through agreements and statutory
pass-through obligations;
(ii) second, on each January 2 and June l, to the successor agency for p�yments lis[ed in its
ROPS, with debt service payments (and amounts required to replcnish the related reserve funds, if any)
scheduled to be made for tax allocation bonds having the highest priority over payments scheduled for
other debts and obligations listed on the Recognized Obligation Payment Schedule;
(iii) third, on each January 2 and June l, to the successor agency for the administrative cost
allowance, as defined in the Dissolution Act; and
(iv) fourth, on each January 2 and June 1, to taxing entities any moneys remaining in the
RPTTF after the payments and transfers authorized by clauses (i) through (iii), in an amount
proportionate to such taxing entity's share of property tax revenues in the tax rate area in that fiscal year
(without giving effect to any pass-through obligations that were established under the Redevelopment
Law).
The Dissolution Act requires county auditor-controllers to distribute from the RPTTF amounts reyuired
to be distributed under the Pass-Through Agreements and Statutory Pass-Through to the taxing entities on each
January 2 and June 1 before amounts are distributed by the County Auditor-Controller from the RPTTF to the
Successor Agency's Redevelopment Obligation Retirement Fund, unless: (i) pass-through payment obligations
have been made subordinate to debt service payments for the bonded indebtedness of the Former Agency, as
succeeded to by the Successor Agency; (ii) the Successor Agency has reported, no later than the September 1
and June 1 preceding the applicable January 2 or June 1 distribution date, that the total amount available [o the
Successor Agency from the RPTTF allocation to the Successor Agency's Redevelopment Obligation Retirement
Fund, from other funds transferred from the Former Agency and from funds that have or will become available
through asset sales and all redevelopment operations is insufficient to fund the Successor Agency's enforceable
obligations, pass-through payments and the Agency's administrative cost allowance for the applicable ROPS
period; and (iii) the State Controller has concurred with the Succetsor Agency that there are insufficient funds
for such purposes.
lf the requirements set forth in clauses (i) through (iii) of the foregoing paragraph have been met, the
Dissolution Act provides for certain modifications in the distributions otherwise calculated to be distributed on
the applicable January 2 or June 1 property tax distribution date (�s adjusted for weekends and holidays). To
provide for calculated shortages to be paid to the Successor Agency for enforceable obligations, the amount of
the deficiency will first be deducted from the residua) amount otherwise cdlculated to be distributed to the taxing
entities under the Dissolution Act after payment of the Successor Agency's enforceable obligations, pass-
through payments and the Successor Agency's administrative cos[ allowance. lf such residual amount is
exhausted, the amount of the remaining deficiency will be deducted from amounts available for distribution to
the Successor Agency for administrative costs for the applicable ROPS period in order to fund the enforceable
obligations. Finally, funds required for servicing bond debt may be deducted from the amounts to be distributed
under subordinated Pass-Through Agreements, in order to be paid to the Successor Agency for enforceable
obligations, but only after the amounts described in the previous two sentences have been exhausted. The
Dissolution Act provides for a procedure by which the Successor Agency may make statutory pass-through
payments subordinate to the Bonds. The Successor Agency has not undertaken any procedures to obtain
such subordination of the statutury pass-through payments and, therefore, statutory pass-thruugh
payments are senior to the Bonds as described below. The Successor Agency's Pass-Through Agreement
with certain Taxing Agencies are subordinate to the Bonds by their terms. However, the Successor Agency
cannot guarantee that this process prescribed by the Dissolution Act of administering the Tax Revenues and the
subordinations provided in the Pa1s-Through Agreements will effectively result in adequate Tax Revenues for
18
RESOLUTION NO. SA-RDA 062
the payment of principal and interest on the Bonds when due. See the captions "THE PROJECT AREAS - Pass-
Through Agreements" and "- Statutory Tax Sharing Payments" and "RISK FACTORS - Recognized Obligation
Payment Schedule."
Recognized Obligation Payment Schedules
Enforceable Obligations. The Dissolution Act requires successor agencies to prepare and approve, and
submit to the successor agency's oversight board and the State Department of Finance for approval, a ROPS
pursuant to which enforceable obligations (as defined in the Dissolution Act) of the successor agency are listed,
together with the source of funds to be used to pay for each enforceable obligation. As defined in the Dissolution
Act, "enforceable obligation" includes bonds, including the required debt service, reserve set-asides, and any
other payments required under the indenture or similar documents governing the issuance of the outstanding
bonds of the former redevelopment agency, as well as other obligations such as loans, judgments or settlements
against the former redevetopment agency, any legally binding and enforceable agreement that is not otherwise
void as violating the debt limit or public policy, contracts necessary for the administration or operation of the
successor agency, and amounts borrowed from the Low and Moderate Income Housing Fund and from the city.
A reserve may be included on the ROPS and held by the successor agency when required by the bond inden[ure
or when the next property tax allocation will be insufficient to pay all obligations due under the provisions of the
bond for the next payment due in the following half of the calendar year (see APPENDIX A—"SUMMARY OF
CERTAIN PROVISIONS OF THE INDENTURE"). The Successor Agency has covenanted to request such
reserves as described below.
Under the Dissolution Act, the categories of sources of payments for enforceable obligations listed on a
ROPS are the following: (i) the Low and Moderate Income Housing Fund (however, as discussed under
"INTRODUCTION — Security for the Bonds," the Low and Moderate Income Housing Fund was eliminated
under the Dissolution Act), (ii) bond proceeds, (iii) reserve balances, (iv) administrative cost allowance, (v) the
RPTTF (but only to the extent no other funding source is available or when payment from property tax revenues
is required by an enforceable obligation or otherwise required under the Dissolution Act), or (vi) other revenue
sources (including rents, concessions, asset sale proceeds, interest earnings, and any other revenues derived from
the former redevelopment agency, as approved by the oversight board). Other than amounts deposited in the
RPTTF allocable to the Project Areas and amounts held in funds and accounts under the lndenture, the
Successor Agency does not expect to have any other funds available to pay the Bonds.
The Dissolution Act provides that only those payments listed in the ROPS may be made by the
Successor Agency from the funds specified in the ROPS.
Required Approvals. As provided in SB 107, the ROPS with respect to each Fiscal Year (which is
segregated into six-month periods beginning July 1 and January 1(each, a"ROPS Payment Period")), must be
submitted by the Successor Agency, after approval by the Oversight Board, to the County Auditor-Controller,
the State Department of Finance, and the State ControUer by each February 1(unless a Last and Final ROPS has
been approved as described below). For information regarding procedures under the Dissolution Act relating to
late ROPS and implications thereof on the Bonds, see "RISK FACTORS Recognized Obligation Payment
Schedule."
Pursuant to SB 107, commencing on January 1, 2016, successor agencies that have received a Finding
of Completion and the concurrence of the Department of Finance as to the items [hat qualify for payment,
among other conditions, may at their option, file a"Last and Final" ROPS schedule (the "Last and Final
ROPS"). If approved by the State Department of Finance, the Last and Final ROPS will be binding on all
panies, and the successor agency will no longer submit any additional ROPS to the Department of Finance or
the Oversight Board. The county auditor-controller will remit the authorized funds to the successor agency in
accordance with the appcoved Last and Final ROPS until each remaining enforccable obligation has been fully
paid. A successor agency may submit no more than two requests to amend an approved Last and Final ROPS.
The Successor Agency plans to evaluate its outstanding obligations from time to time, to determine whether
(and if so, when) it would file a Last and Final ROPS.
m
RESOLUTION NO. SA-RDA 062
Debt Service. The Successor Agency has made a covenant in the Indenture to include in each RUPS to
be submitted after the effective date of the Indenture a request for the County Auditor-Controller to disburse
from the RPTTF to the Successor Agency on each RPTTF Disbursement Date, the following amounts: (i) the
interest payment coming due with respect to the Outstanding Bonds and Parity Obligations (if any) during such
ROPS Payment Period, (ii) for any ROPS Payment Period which covers payments from January through June of
a calendar year, at least one-half (but, at the discretion of the Successor Agency, may be up to all) of the
principal amount (including maturing principal and any Sinking Account Installment) coming due with respect
to the Bonds and Parity Obligations (if any) on October 1 of such calendar year (the "Principal Reserve"), (iii)
for any ROPS Payment Period which covers payments from luly through December of a calendar year, an
amount equal to the principal amount (including maturing principal and any Sinking Account Installment)
coming due with respect to the Bonds and Parity Obligations (if any) on October 1 of such calendar year, less
the Principal Reserve already received in connection with the immediately prior ROPS Payment Period and
deposited with the Trustee, and (iv) amounts, if any, required to replenish the Reserve Account (including
payments to the provider of any Qualified Reserve Credit lnstrument for drdws on such Qualified Reserve
Credit Instrument), as required pursuant to the lndenture, and to replenish the reserve accounts of any Parity
Obligations (if any).
The Successor Agency shall also include on the periodic ROPS for approval by the Oversight Board and
State Department of Finance, to the extent necessary and permitted under the Dissolution Act, the amounts to be
held as a reserve until the next ROPS Payment Period, as contemplated by California Health and Safety Code
Section 34171(d)(1)(A), if the next property tax allocation is projected to be insufficient to pay all obligations
due under this Indenture during that next ROPS Payment Period. To that end, whenever the Successor Agency
is preparing a ROPS, the Suceessor Agency shall, based on information obtained from the County Auditor-
Controller, review the amount of dollars deposited in the RPTTF on the two immediately prior RPTTF
Disbursement Dates. For the purposes of complying with this paragraph (i.e., projecting whether the next
property tax allocation witl be sufficient to pay all obligations due under this Indenture during the next ROPS
Period), the Successor Agency shall assume that the property tax revenue collection (and thus, the dollar amount
to be deposited in the RPTTF) will be consistent with the pattern shown during the last two ROPS Payment
Periods, but without any assumed increase to the assessed value of the taxable properties in the Project Areas.
Upon the Successor Agency's receipt of Tax Revenues on each RPTTF Disbursement Date, the
Successor Agency shall apply the Tax Revenues pursuant to the ROPS (as approved by the State Department of
Finance} and deposit the Tax Revenues received for the payment of debt service of the Bonds and any Parity
Obligations and any replenishment of the Reserve Account and Parity Reserve Accounts into a fund designated
the "Special Fund." During each Bond Year, the Successor Agency shall deposit such moneys in the Special
Fund until such time as the amount so deposited in the Special Fund is at least equal to the sum of (i) the
aggregate amount required to be transferred to the Trustee pursuant to the Indenture for such Bond Year, and (ii)
the aggregate amount required by the goveming documents of the Parity Obligations to be transferred for the
debt service payment and replenishment of the Parity Reserves.
In addition to the foregoing, from the moneys received by the Successor Agency as part of January 2017
RPTTF disbursement, the Successor Agency shall promptly deposit S into the Special Fund for
application toward debt service on the Bonds. Such amount represen[s moneys received by the Successor
Agency pursuant to a listing on thc ROPS for the "ROPS 16-17B" period (i.e., the ROPS Payment Period
covering January 2017 through June 2017) that would have been used for debt service for the Prior Loans if the
Prior Loans were not refunded.
The Successor Agency has no power to levy and collect taxes, and various factors beyond its control
could affect the amount of Tax Revenues available in any six-month period (or otherwise) to pay the principal of
and interest on the Bonds. See "RISK FACTORS."
The Bonds are special obligations of the Successor Agency. The Bonds do not constitute a debt or
liability of the City, the County, the State or of its political subdivision, other than the Successor Agency.
The Successor Agency shall only be obligated to pay the principa! of the Bonds, or the interest thereon,
from the funds described in the Official Statement, and neither the faith and credit nor the taxing power
20
RESOLUTION NO. SA-RDA 062
of the City, the County, the State or any of its political subdivisions is pledged to the payment of the
principal of or the interest on the Bonds. The Successor Agency has no taxing power.
The State Legislature has amended the Dissolution Act several times. The Successor Agency expects,
but cannot guarantee, that the processes for funding of enforceable obtigations prescribed by any new legislative
change in the Dissolution Act will not interfere with its administering of the Tax Revenues in accordance with
the Indenture and will effectively result in adequate Tax Revenues for the timely payment of principal of and
interest on the Bonds when due.
Reserve Account
A Reserve Account has been established under the Indenture to be held by the Trustee to further secure
the timely payment of principal of and interest on the Bonds. Within the Reserve Account, a separate
subaccount (each a"Reserve Subaccount") has been established for each series of Bonds. The Reserve
Requirement for each Reserve Subaccount is equal to the least of (i) ten percent of the sum of the original stated
principal amounts of the Bonds of such series at issuance, (ii) 125 percent of Average Annual Debt Service of
the Outstanding Bonds of such series or (iii) Maximum Annual Debt Service of the Outstanding Bonds of such
series. Moneys in (or available to) each Reserve Subaccount will be used and withdrawn by the Trustee solely
for the purpose of (i) replenishing the Interest Account, the Principal Account or the Sinking Account in such
order, in the event of any deficiency at any time in any of such accounts or for the purpose of paying the interest
on or principal of the related series of Bonds in the event that no other money in the Special Fund or the Debt
Service fund is lawfully available therefor, or (ii) making the final payments of principal of and interest on the
related series of Bonds.
Each Reserve Subaccount secures only the Bonds of the related series, and will not secure the Senior
Bonds or any other series of Parity Obligations that may be issued pursuant to the terms of the Indenture (see
"No Addit+onal Debt Other Than Refunding Bonds" below).
The Indenture provides that in lieu of a cash deposit, the Successor Agency may satisfy all or a portion
of the Reserve Requirement for a series of Bonds by means of a Qualified Reserve Account Credit Instrument
(see APPENDiX A-"SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE"). The Successor
Agency has applied for a debt service reserve insurance policy to satisfy such requirement. The Successor
Agency will decide whether to purchase such policy in connection with the offering of ihe Bonds.
The Senior Bonds reserve account is currently secured by a debt service reserve. Such amounts are not
available to pay debt service on the Bonds.
No Additional Debt Oiher Than Refunding Bonds
The Successor Agency covenants that it will not incur any additional obligations payable, either as to
principal or interest, from the Tax Revenues, that will have any lien upon the Tax Revenues on a parity with or
superior to the lien under the Indenture for the Bonds; except that the Successor Agency may: (a) incur Pazity
Obligations to refund then outstanding Bonds or the Senior Bonds (or Parity Obligations issued after the Closing
Date pursuant to the Indenture), if (i) aggregate debt service on such proposed Parity Obligations will be lower
than the aggregate debt servicc on the Bonds (or Parity Obligations) being refunded; (ii) the scheduled final
maturity date of such proposed Parity Obligations will not be later than the scheduled final maturity date of the
Bonds or other Parity Obligations being refunded; and (iii) the issuance of such Parity Obligations shall be in
compliance with California Health and Safety Code Section 34177.5 (but only to the extent that such provision
of the Dissolution Act is applicable and then in effect); or (b) incur Obligations which will have a lien on Tax
Revenues junior to the Bonds; or (c) incur Obligations that will be payable in whole or in part from sources
other than the Tax Revenues pledged under the lndenture.
21
RESOLUTION NO. SA-RDA 062
PROPERTY TAXATION IN CALIFORNIA
Manner in Which Property Valuations and Assessments are Determined {Article XII). On June 6,
1978, California voters approved an amendment (commonly known as both Proposition 13 and the Jarvis-Gann
Initiative) to the State Constitution which imposes certain limitations on taxes that may be levied against real
property. This amendment, which added Article XIiIA to the State Constitution, among other things, defines full
cash value of property to mean "the county assessor's valuation of real property as shown on the 1975/76 tax
bill under `full cash value,' or, thereafter, the appraised value of real property when purchased, newly
constructed, or a change in ownership has occurred after the 1975 assessment." This full cash value may be
adjusted annually to reflect inflation at a rate not to exceed 2�Ic per year, or any reduction in the consumer prire
index or comparable local data, or any reduction in the event of declining properiy value caused by substantial
damage, destruction or other factors. The amendment further limits the amount of any ad valorem tax on real
property to 1�Ic of the full cash value of that property, except that additional taxes may be levied to pay debt
service on indebtedness approved by the voters prior to luly 1, 1978 and on any bonded indebtedness for the
acquisition or improvement of real property which is approved af[er July 1, 1978 by two-thirdti of the votes cast
by voters voting on such indebtedness. See "SECURITY FOR THE BONDS - Tax Revenues," "Property Tax
Rate" below and "RISK FACTORS - Factors Which May Affect Tax Revenues - Reduction in Inflationary
Ratc."
In the general election held November 4, 1986, voters in the State approved two mcasures, Propositions
S8 and 60, which further amend the terms "purchase" and "change of ownership," for purposes of determining
full cash value of property under Article XIIIA, to not include the purchase or transfer of ( I) real property
between spouses and (2) the principal residence and the first $1,000,000 of other property between parents and
children. Proposition 60 amends Article X[IIA to permit the Legislature to allow persons over age 55 who sell
their residence and buy or build another of equal or lesser value within two years in the same �ounty (or in
certain cases, another county), to transfer the old residence's assessed value to the new residence.
Proposition 8 Adjustments. Proposition 8, approved in 1978, provides for the assessment of real
property at the lesser of its originally determined (base year) full cash valuc compounded annually by the
inflation factor, or its full cash value as of the lien date, taking into account reductions in value due to damage,
destruction, obsolescence or other factors causing a decline in market value. Reductions based on Proposition 8
do not establish new base year values, and the property may be rcassessed as of the fol(owing lien date up to the
lower of the then-current fair market value or the factored base year value. The State Board of Equalization has
dpproved this reassessment formula and such formula has been used by coun[y assessors statewide, and such
methodology has been upheld by the California courts. During the recent recession, the County made significant
blanket assessed value reductions throughout the County pursuant to Proposition 8 from the maximum amount
that could bc assessed on property.
Unsecured and Secured Property. In Califomia, property which is subject to ad valorem taxes is
classified as "secured" or "unsecured." The secured clastiification includes propeRy on which any property tax
levied by a county becomes a lien on that property. A tax levied on unsecured property does not become a lien
against the taxed unsecured property, but may become a lien on certain other property owned by the taxpayer.
Every tax which becomes a lien on secured property, arising pursuant to State law, has priority over all other
lien� on the secured property, regardless of the time of the creation of the other liens.
Property in the Project Areas are assessed by the Riverside County Assessor except for public utility
property which is assessed by the State Board of Equalization.
The valuation of secured property is determined as of January I each year for taxes owed with respect to
the succeeding Fiscal Year. The tax rate is equalized during the following September of each year, at which time -�
the tax rate is determined. Secured and unsecured property is entered on separate parts of the assessment roll
maintained by the county assessor. The method of collecting delinquent taxes is substantially different for the
two classifications of property.
22
RESOLUTION NO. SA-RDA 062
Property taxes on the secured roll are due in two installments, on November 1 and February 1 of the
fiscal year. If unpaid, such taxes become delinquent on September 10 and Apri! 10, respectively, and a 10%
penalty attaches to any delinquent payment in addition to a$38.63 cost on the second installmen[, which is the
cost for fiscal year 2016/17. On July 1 of each fiscal year any property which is delinquent will become
defaulted. Such propeRy may thereafter be redeemed by payment of the delinquent taxes and the deiinquency
penalty, plus a redemption penalty of 1.5% per month to the time of redemption, together with any other charges
permitted by law. If taxes are unpaid for a period of iive years or more, the property is subject to sale by the
County Tax Collector. The exclusive means of enforcing the payment of delinquent taxes with respect to
property on the secured roll is the sale of the property securing the taxes for the amount of [axes which are
delinquent.
The County utilizes a mechanism for the distribution of tax increment revenue to the former
redevelopment agencies that has a similar effect on the Agency's tax increment revenues as the device known as
the Teeter Plan (Section 4701 et seq. of the Califomia Revenue and Taxation Code). The Teeter Plan allows
counties to distribute secured property tax revenue to participating jurisdictions without regard to delinquencies
by maintaining a reserve fund to cover delinquencies and allocating revenue based on the original secured roll,
retaining all delinquent tax payments and penalties. Under the mechanism used by the County to distrib�te tax
increment revenue to the former redevelopment agencies, the County pays one-half of the taxes from the net
taxable assessed valuation appearing on the equalized roll to each agency's RPTTF on January 2 and the other
one-half on June 1; delinquencies are not deducted from the RPTTF revenue, and delinquent tax payments and
defaulted tax redemptions, penalties and interest are not added to RPTTF revenue. Consequently, the Successor
Agency is not affected by delinquent tax payments.
Property taxes on the unsecured roll become delinquent> if unpaid on August 31. A l0�lo penalty
attaches to delinquent taxes on property on the unsecured roll, and an additional penalty of 1.S�Io per month
begins to accrue on November 1 of the fiscal year. The County has four ways of collecting delinquent unsecured
personal property taxes: (1) a civil action against the taxpayer; (2) filing a certificate in the office of the County
Clerk specifying certain facts in order to obtain a judgment lien on certain property of the taxpayer, (3) filing a
certit"icate of delinquency for record in the County Recorder's Office, in order to obtain a lien on certain
property of the taxpayer; and (4) seizure and sale of personal propeRy, improvements or possessory interests
belonging or assessed to the assessee.
Supplemental Assessments. Legislation adopted in 1984 (Section 75, et seq. of the Revenue and
Taxation Code of the State of California) provides for [he supplemental assessment and taxation of property at
its full cash value as of the date of a change of ownership or the date of completion of new construction (the
"Supplemental Assessments"). To determine the amount of the Supplemental Assessment the County Auditor-
Controller applies the current year's tax rate to the supplemental assessment roll and computes the amoun[ of
taxes that would be due for the full year. The taxes due are then adjusted by a proration factor to reflect the
portion of the tax year remaining as determined by the date on which the change in ownership occurred or the
new construction was completed. Supplemental Assessments becomc a lien against the rea) property on the date
of the change of ownership or completion of new construction.
Unitary Property. Commencing in the 1988/89 Fiscal Year, the Revenue and Taxation Code of the State
of California changed the method of allocating property tax revenues derived from state assessed utility
properties. It provides for the distribution of statc assessed values to tax rate areas by a county-wide
mathematical formula rather than assignment of state assessed value according to the location of those values in
individual tax rate areas.
Commencing with the 1988/89 Fiscal Year, eaeh county has established one county-wide tax rate area.
The assessed value of all unitary property in the county has been assigned to this tax rate area and one tax rate is
levied against all such property ("Unitaty Revenues").
The property tax revenue derived from the assessed value assigned to the county-wide tax rate area shall
be allocated as follows: (1) each jurisdiction will be allocated up to 2�7� of the increase in Unitary Revenues on a
pro rata basis county-wide; and (2) any decrease in Unitary Revenues or inereases less than 2�7c, or any increase
23
RESOLUTION NO. SA-RDA 062
in Unitary Revenues above 29'c will be allocated among jurisdictions in the same proportion of cach
jurisdiction's Unitary Revenues received in the prior year to the total Unitary Revenues county-wide.
Legislation adopted in 2006 (SB 1317, Chapter 872) provides that, commencing with Fiscal Year
2007/08, certain property related to new electrical facilities shall be allocated entirely to the county in which
such property is located and property tax revenues derived from such property shall be allocated to such county
and certain Taxing Agencies with such county.
Property Tax Rate. The difference between the $1.00 general tax levy provided under Article X1IlA tax
rate and those actually levied (referred to as the "tax override rate") represents the tax levied by overlapping
entities to pay debt service on bonded indebtedness approved by the voters.
Section 34183 of the Dissolution Act effectively eliminated the tax override rate from the calculation of
Tax Revenues with respect to tax override rates authorized by voters for thc purpose of repaying bonded
indebtedness for the acquisition or improvement of real property. Future Tax Revenues have been projected by
applying a tax rate of $1.00 per $100 of taxable value general levy to incremental taxable values.
Administrative Costs. In 1990, the Legislature enacted SB 2557 (Chapter 466, Statutes of 1990) which
allows counties to charge foc the cost of assessing, collecting and allocating property tax revenues to local
government jurisdictions on a prorated basis. SB 1559 (Chapter 697, Statutes of 1992) explicitly includes
redevelopment agencies among the jurisdictions which are subject to such charges. ln addition, Sections
34182(e) and 34183(a) of the Dissolution Act allow administrative costs of the County Auditor-Controller for
the cost of administering the provisions of the Dissolution Act, as well as the foregoing SB 1559 amounts, to be
deducted from property tax revenues before moneys are deposited into the RPTTF. For Fiscal Year 2016l17, the
County administrative fees charged to the Project Areas including administration of the RPTTF were
$1,013,000. In total, the fees represent approximately 1.10�/� of gross Tax Revenues.
THE SUCCESSOR AGENCY
Government Organization
The Former Agency was established by the City Council in 1974 pursuant to the Redevelopment Law.
On June 29, 2dl l, AB XI 26 was enacted, together with a companion bill, AB X1 27. A lawsuit was brought in
the California Supreme Court, California Redevelopment Association, et al. v. Matosantos, et al., 53 Cal. 4th
231 {Cal. Dec. 29, 2011), c6allenging the constitutionality of AB X 1 26 and AB X 1 27. In its December 29,
201 I decision, the Califomia Supreme Court largely upheld AB X I 26, invalidated AB X 1 27, and held that AB
X 1 26 may be severed from AB X 1 27 and enforced independently. As a result of AB X 1 26 and the decision ot
the California Supreme Court in the California Redevelopment Association case, as of February 1, 2012, all
redevelopment agencies in the State were dissolved, including the Former Agency, and successor agencies were
designated as successor entities to the former redevelopment agencies to expeditiously wind down the affairs of
the former redevelopment agencies.
Section 34173(g) of the Dissolution Act expressly affirms that the Successor Agency is a separate
public entity from the City, that the two entities shall not merge, and that the liabilities of the Former Agency
will not be transferred to the City nor will the assets of the Former Agency become assets of the Ciry.
Successor Agencv Board Members
Jan Harnik, Chair'
Sabby Jonathan, Vice-Chuir
Kathleen Kelly, Dire�ctor-elect
Gina Nestande, Directnr-elect
Susan Marie Weber, Directur
Term Expires
November 2018*
November 201 S*
November [2020]
Novembcr [2020]
November [2020j
' Suhject to City Council reorganization after clection ccrtification on Dcccmher 8, 2016.
24
RESOLUTION NO. SA-RDA 062
The City Manager serves as the Successor Agency's Executive Director, the City's Finance Director
serves as the Successor Agency's Finance Officer and the City Clerk serves as the Successor Agency Secretary.
The costs of such functions, as well as additianal services performed by City staff are alloca[ed annually to the
Successor Agency, within certain limitations established by the Dissolution Act. Such reimbursement is
subordinate to payment on any outstanding bonds of the Successor Agency.
Successor Agency Powers
Pursuant to the Dissolution Act, the Successor Agency is a separate public body from the City and
succeeds to the organizational status of the Former Agency but without any legal authority to participate in
redeve{opment activities, except to complete any work related to an approved enforceable obligation. The
Successor Agency is tasked with expeditiously winding down the affairs of the Former Agency, pursuant to the
procedures and provisions of the Dissolution Act. Under the Dissolution Act, many Successor Agency actions
are subject to approval by the Oversight Board, as well as review by the State Department of Finance. Califomia
has strict laws regarding public meetings (known as the Ralph M. Brown Act) which generally make all
Successor Agency and Oversight Board meetings open to the public in similar manner as City Council meetings.
Dissolution Act Milestones
Section 34179.5 of the Dissolution Act established a due diligence review process for determining the
unobligated balances that redevelopment agencies had available as of June 30, 2012 to remit to their respective
county auditor-controllers for distribution to affected Taxing Agencies within project areas of the former
redevelopment agencies. The Successor Agency has remitted to the County Auditor-Controller all of the
unobligated balances as determined by the State Department Finance. On May 15, 2013, the Successor Agency
received i[s Finding of Completion from the State DepaRment of Finance. Reeeipt of the Finding of Completion
allows the Successor Agency to do several things, among them, developing a Long Range Property
Management Plan (described below) and spending proceeds of bonds issued prior to December 31, 2010, al]
requiring approval of the Oversight Board.
After receiving the finding of completion, each successor agency is required to submit a Long Range
Property Management Plan (a "Long Range Property Management Plan") detailing what it intends to do with its
inventory of real propeRy interests. Permissible uses include: sale of the property, use of the property to fulfill
an enforceable obligation, retention of the property for future redevelopment, and retention of the property for
governmental use. The State Department of Finance approved the Successor Agency's Long Range PropeRy
Management Plan on June 2, 2014 and an amendment to the Long Range Property Management Plan on
December 9, 2015.
Successor Agency Accounting Records and Financial Statements
The activities of the Successor Agency are reported as a fiduciary trust fund, which is in accordance
with guidance issued by the State Department of Finance on September 19, 2012 and available on its website
relating to redevelopment dissolution (www.dof.ca.gov/redevelopment) under the category of "Common RDA
Dissolution Questions and Answers," interpreting Section 34177(n) of the Law concerning certain successor
agency postaudit obligations. The State Department oi Finance's website is not in any way incorporated into this
OfficiaV Statement, and the Successor Agency cannot take any responsibility for, nor make any representation
whatsoever as to, the continued accuracy of the Internet address or the accuracy, completeness, or timeliness of
information posted there. In addition, from time to time, the State Department of Finance changes its guidance
without notice.
The City's financial statements for the Fiscat Year ended June 30, 2015, which include information
regarding the Successor Agency, are attached as "APPENDIX D" to this Official Statement and have been
audited by White Nelson Diehl Evans LLP, Irvine, California. The Successor Agency's audited financial
s[atements are public documents and are included within this Official Statement without the prior approval of
the auditor. White Nelson Diehl Evans LLP has not been engaged to perfornt, and has not performed, since
the date of its report included in the Official Statement, any procedures on the ftnaneial statements addressed
25
RESOLUTION NO. SA-RDA 062
in lhat report. White Nelson Diehl Evans LLP a[so has not perJormed any procedures relating to this Officia[
Statement.
Stipulation Agreement
On May I5, 1991, the Riverside County Superior Court entered a final judgment incorporating the terms
of a Stipulation for Entry of Judgment ("Original Stipulation") in Case No. 51124 and a Stipulation for Entry of
Judgment pursuant to Setdement Agreement and Mutual Release ("Settlement Agreement") in Case No. S 1124,
among the Former Agency, the City, the Western Center on Law and Poverty, Inc., California Rural L.egal
Assistance, and others. On June 18, 1997 and on September 20, 2002, the Riverside County Superior Court
amended the judgment, incorporating Stipulations Amending Stipulation for Entry of Judgment.
The judgment, as amended (the "Judgment"), generally required the Former Agency to use 20�7c of its
tax increment revenues, and additional tax incremen[ revenues if necessary, to develop, rehabilitate, or otherwise
i►nancially assist affordable housing units and to meet ceRain housing needs of the City. Before distiolution, the
Former Agency used its Housing Set-Aside (see "INTRODUCTION — Security for the Bonds") to fulfill its
obligations under the Judgment. The Housing Refunded Bonds were used to finance and refinance affordable
housing projects that satisfied the requirements of both the Judgment and the Redevelopment Law provisions
relating to the Housing Set-Aside. Accordingly, the Former Agency pledged, and used, the Housing Set-Aside
for the repayment of certain prior loans relating to the Housing Refunded Bonds.
Under the terms of the Judgment, the Former Agency was permitted to incur indebtedness and pledge
tax increment revenues to refinance its obligations, so long as: (i) the total amount of debt service payable in
connection with such refinancing is less lhan the total amount of debt service remaining to be paid on the
refunded obligations, or (ii) the total amount of debt service payable in connection with such refinancing reflects
a present value savings when compared with the total dmount of debt servicc remaining to be paid on the
refunded obligations.
While thc Dissolution Act has eliminated the Housing Fund and the requirement to deposit the Housing
Set-Aside into such fund, the Successor Agency continues to recognize the Judgment as its enforceablc
obligation. On its ROPS, the Successor Agency has included line items designated as "Stipu[ation Judgment
Case No. S 1124," listing the amounts necessary to fulfill its obligations under the Judgment (after taking into
account the amounts already listed for the repayment of the Housing Refunded Bonds). While the DOF
originally approved such line items, the DOF changed its position beginning with ROPS 14-15A (i.e., covering
the period commencing July l, 2014).
On August 14, 2014, the Successor Agency filed an action, Successor Agency to the Palm Desert
Re�levelo�ment Agency v. Michael Cohen, Sacrumento Superior Court Cuse Nu. 34-20I4-00167698 (the
"Successor Agency Lawsuit"), sccking to compel the DOF to permit paymcnt of the affordable housing
obligations mandated by the Judgment. Subsequently, in view of the fact that there were similar cases pending
in the California Third District Court of Appeal, the Successor Agency took action to have the Successor
Agency Lawsuit dismissed without prejudice, pending resolution of those similar cases.
Under the Indenture, the term "Housing Portion" is defined as the portion of property tax revenucs
required to be deposited into thc RPTTF that is equal to amount that the Former Agency would have becn
required to deposit into the Housing I�und, if the Former Agency had not been dissolved. The calculation of the
Housing Portion is not dependent on the DOF's recognition of the Judgment. "Tax Revenues" pledged to thc
Bonds is defined as the moneys deposited into the RPTTF, less the Housing Portion, and administrative costs
payable to the County pursuant to the HSC Section 34183(a), unsubordinated pass-through payments and
repayments far the Senior Loan. Thc amount of Tax Rcvcnucs available to pay debt service on the Bonds .,.
should bc unaffected by the outcome of the dispute between the Successor Agency and the UOF regarding the
Judgment.
26
RESOLUTION NO. SA-RDA 062
Plan Limitations
In accordance with the Redevelopment Law, redevelopment plans were required to inciude certain
limits on the financing of redevelopment projects. These limits could include a time limit on the life of the
redevelopment plan, a time limit to incur debt, a time limit on the receipt of Tax Revenues and the repayment of
debt, and a limit on the amount of bonded indebtedness outstanding at any time. SB 107 clarifies that the former
tax increment limits in redevelopment plans no longer apply for purposes of paying approved enforceable
obligations such as the Bonds and the Senior Bonds.
27
RESOLUTION NO. SA-RDA 062
THE PROJECT AREAS
Description of the Project Areas
There are four Project Areas totaling i 1,771 acres and encompasses 68�c of the total acres in the City.
The following table provides information on assessed and incremental value of each Project Area.
Proiect Areas
Projcct No. 1 Original Are•r
Yroject No. I 19R2 AdJcd Arca
Projcct Nu. 2
Project ho. 3
Project tio. 4
Total All F'rojcct Arexs
TABLE 1
BY PROJECT AREA
i,AND USE BY ASSESSED VALUE
(2016/17)
2U16-17 Less 13ese
AcreaYe Assessed Value Value
S80 5 1,058,238,219 $ 27,4R5,R36
5,240 5,278,508,068 656,(XiS,059
2.927 I .686.801,512 102.1 i7.447
764 564,855,842 149,523,2SS
2.2G0 1,990,188.034 587.192.21 R
1 I.771 510,578,593,675 $ I,522,423,R 15
2016-17 Increment
and A�.Sessed Value
$ I .030.752383
4.622.44�,009
I ,584,646.065
415.332,i87
1,4U2,99S,816
59,056, I 69,860
/C ll�
Incremental
Value
I I.iK��
S 1.0-1
17.50
�3.59
I 5.49
� �)��.�)�)��
Sourcc: Fiscai Consultant's Rcport.
Specific information about eaeh Project Area and its redevelopment plan is set forth below.
Project Area No. I. The Project Area No. 1 was formally established with the adoption by the City
Council of a redevelopment plan (the "Original Plan") for approximately 580 acres (the "Original Area")
pursuant to Ordinance No. 80, adopted on July 16, 1975. Approximately 5,240 acres (the "Added Territory")
were added to the Original Area pursuant to amendments to the Original Plan approved and adopted by the City
Council by Ordinance No. 275, adopted on November 25, 1981 and Ordinance No. 324, adopted on October 13,
1983 (collectively, the "Amendments"). Thc Original Plan, as amended by the Amendments, is referred to as the
"PA 1 Redevelopmcnt Plan."
The Project Area No. 1 includes approximately 5,820 acres, comprising approximately 14,221 parcels,
zoned for residential, office, commercial, industrial, public and open space uses. The Project Area incorporates
an approximately 70-acre Civic Center campus; a Sheriffs dispatch center; County Library facilities;
muitifamily rcntal, townhouse and single-family developments; the Canyons at Bighorn, a 275-unit luxury
custom home development; and over two million square feet of retail space, including three major retail malis.
The Westfield Shoppingtown (locatcd in the Original Area) was expanded in January 2003 to add two parking
garages totaling 1,000 parking spaces, the expansion of Macy's, and an additional 40,000 square feet of retai{
space, including Barnes & Noble. The Project Area also includes the Gardens on El Paseo, EI Paseo Village
and the Shops on EI Paseo which include over 200,000 square feet of luxury retail space. Luxury retail brands
within the EI Paseo include, Apple, Saks Fifth Avenue, TUMI, Kate Spade, Eileen Fisher and Louis Vuitton.
Project Area No. 2. On July 1 S, 1987, the Redevelopment Plan for Project Area No. 2 was adopted by
the City of Palm Desert pursuant to the adoption of Ordinance No. 509. Project Area No. 2 encompasses
approximately 2,927 acres (68,230 parcels including timeshare parcels) of residential, hotel/resort, ofiice and
undeveloped uses. Project Area No. 2 is generally bounded by the Palm DeseR City limits and Interstatc l0 to
the north, Ger�ld Ford Drive to the east, Country Club Drive and Hovley Lane to the south and Portola and
Monterey Avenues to the west.
Project Area No. 3. The Redevelopment Plan for Project Area No. 3 was adopted by the City on July
17, 1991 pursuant to the adoption of Ordinance No. 652. Project Area No. 3 is located in the City and includes
approximately 1,531 acres, comprising 1,016 parcels, zoned for residential, office, commercial, industrial,
public and open space uses. Project Area No. 3 is generally bounded by Portola Avenue and Cook Street to the
28
RESOLUTION NO. SA-RDA 062
west, and Carlotta Drive to the east, Hovley Lane and Running Springs Drive to the north and the Whitewater
River Channel to the south. The Portola Country Club is not within Project Area No. 3.
Project Area No. 4. The Redevelopment Plan for Project Area No. 4 was adopted by the City on July
19, 1993 pursuant to the adoption of Ordinance IVo. 724. Project Area 1Vo. 3 includes approximately 2,260
acres, comprising 10,556 parcels, zoned for residential, ofiice, commercial, industrial, public and open space
uses. Project Area No. 4 is generally bounded by Eldorado Drive to the west, running southward to the
boundary of the City of Indian Wells, then eastward to the corner boundary between the county line and the City
of Indian Wells. The western boundary follows this line southward to Fred Waring Drive, which is also the
so�thern boundary of the City limits. The eastern boundary of Project Area No. 4 is Washington Street and the
northern boundary is County Club Drive.
Land Use
Land use within the Proje�t Areas is predominantly residential, encompassing 73.62�7'c of all uses by
assessed value. The following table shows land use among ali Project Areas by assessed value.
Land Use
Residcntial:
Single Family
Condominium
Multi Family
Other
Commercial:
Retail
Uffice
Hotel/Motcl
Other
Timeshares
Indusvial
Miscellaneous
Public
Unsecured
Totals
TABLE 2
ALL PROJECT AREAS
LAND USE BY ASSESSED VALUE
(2016/17)
Number of Assessed % of
Parcels Value Total
9,674 $ 4,949,379,078 46.79�/�
9,543 2,333,511,057 22.06
387 296,411,443 2.80
1,893 208.772.900 1.97
306 $ 989,963,416 9.36�/�
365 345,�58,8:i5 �.26
22 226,270,805 2.14
53:i 246,939,701 2.3:�
69,397 $ 408,890,790 3.87
185 177,114,542 1.67
255 I46,350,978 1.38
502 - 0.00
1.476 249.630.130 2.36
94,538 $10,578,593,675 100.00�%
Source: Fiscal Consultant's Repurt.
29
RESOLUTION NO. SA-RDA 062
Assessed Valuations and Tax Revenues
Total assessed value of the Project Areas, together with assessed values of the constituent arcas
comprising the Project Areas between fiscal years 2007/08 and 2016/17 are shown in the tables below.
TABLE 3
ALL PROJECT AREAS
CURRENT AND HISTORICAL VALUATIONS
2005/06 through 2016/17
Secured Unsecured
F'Y Value Value
2007-O8 $ �).652.979.213 $305.989.337
2008-09 10.117.866.56i 343.O�i4.906
2009- ] 0 9,709,045.177 i27.469.966
2010-11 9.214,357,136 319,604A11
20 I 1-12 8.853.491,405 303,821,643
2012-1 � 8.839.633.215 248.989.726
201�-14 9,090.410,899 291,714,523
2014-IS 9,597,498.735 257.817.882
2015-16 10,070,986.681 261,573,49R
201 G- ] 7 10.326.33_5.572 252.258.103
Sourcc: Fiscal Consultant's Report.
Total
Value
9.958.968.SS0
10,460.91 1.471
10.036.5 I 5. I 43
9.5��,962.047
9.157.313.068
9.088.622.941
9.382, I 25.4?2
9.855,�16.617
10,332,560,170
10,578.593,675
Less Base
Value
$ I,S22,423,815
1.522.423.81 S
I ,522,423.81 S
I .522.423,815
I ,522,423,A 1 S
I ,522,423,815
I ,522,423.815
1.522.423,815
1,522,42?,815
1,522,423.815
Increment
$R,436,544,735
8,938,487,656
$, 514,091,i 2it
s,oi i.s�x.z3z
7.634.889.283
7, 566.199, I 26
7,859,701,607
8,332.892,802
8,810, I 36.355
9,OS6. I 69,8G0
Percenta�e
ChanPe
5.9!4
-4.7
-S.9
-4.7
-0.9
3.9
fi.0
i.7
2.8
For a detailed description of current and historical assessed value in each Project Area see APPENDIX
C — "FISCAL CONSULTANT'S REPORT."
Actual Tax Revenues paid to the Former Agency or available to the Successor Agency from the Project
Arcas for fiscal years 2011/12 through 2015/16 are shown below.
TABLE 4
ALL PROJECT AREAS
H[STORIC TAX REVENUES RECEIPT
�
Ilill
IV
Repurted Assessed Value"':
Secured
L'nsccurcd
Total Pmject Value
L.ess Basr Ycar Valu�
Total Incremental Value
Tax Rate lo Compute Tax Inrremcnt
Compuled Gross Tax Inc;rement
Unitary Tax
Total CnmpWed Le�y
1'ax Allocation
Allocaicd Tax tnrrrmcnt' �'
Unitary Tax
Total Tax lia.u:d on Coll�ctions
Variancc Fmm Computed Lcvy
7 ('ullections per County
Zuii-t:
5R.8S3,491,405
3U3.821,693
9, t 57,313,098
1,522,4?3,815
7.634.8k3y.2ii3
I.00O�k
76,350,940
1,OS5,430
77.406.370
76,395366
_ 1,055 430
77.45O,79fi
44,425
� nQ. � ��r
2U12-13
b8,839,6i3,215
248,989,72l,
9.08R.622.941
1.522,4? 3,!{ I S
7.56G.199.12G
I .000�70
75,6(�6,465
1,017.1 �tf
��.�x�,�c�3
7.5,666,465
1.017.13$
7G,6R�.603
0
I 00.09�
2013-t4
$9.(KI0.410,899
291,714,523
9382.125.422
1,522.4? 3.815
7.R59.701.f,�7
1.0009r
7 S. iy7,016
-- 1 067 y49
79.6fi�i.96i
78,Sy7.01 G
1.067.949
79.664.965
b
100.0�7�
2014-15
59.597,49R,735
�S�,K►�.sx�
y,8Si.316.617
LS?2.423.815
R ��'_.t4y2.1t02
i .cicx»
g3,334.078
1.091.101
R4.42i,179
83.;74.07R
L(KJlJ01
84.�?5,179
0
100.09i
2015-16
5 I 0,070,986,681
�6I.S73 489
10.3�2.S6Q 170
I.S?3,423,81 i
8.810.136.iS5
I .00�7�
8R,108,75y
I . I S �.Oy3
8�). �60.85 �
88.108.75�1
i.IS �pyi
89.?60,RS'_
0
I OQ.Q'i�
'�' Amounts shown are as reported by thr Counry AuJiwr-Controller in August of e•rch fisral ycar.
''' Amounts represent �he annual Wx incrcmenl revenues apportioned to the Agency and do not ex�lude County administrali�e chargcs, intercst earnin��s.
supplemental taxes, set asides or tax sharing allocations.
'' The County allocates tax increment cevenue� on a Tecter Ytan based on adjusted computed levy.
Sourcc Fiscal Consultant's Rcpon.
��
RESOLUTION NO. SA-RDA 062
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M
RESOLUTION NO. SA-RDA 062
Assessment Appeals
As of October 1 2016, there were a total 189 pending appeals filed in the last 6 years by property
owners in the Project Areas as shown below. The total value of property under appeal for all years is
�,1,363,543,560. Some appeals have been filed for multiple years for the same property. A summary of all
pending appeals is shown below.
TABLE 6
ALL PROJECT AREAS
ASSESSMENT APPEALS
FISCAL YEAR 2009/10 through 2015/16���
Total No. of
Appeals
2009-10 to 2015-16
2,506
No. of Resoived
Appeals
2009-10 to 2015-16
2.317
Fiscal Year
Endin� Junc 30
2016
2015
2014
2013
2012
2011
2010
Total
Number of
Appeals
121
40
2�
i
Q
2
0
189
No. of Successfu)
Appeals
20U9-10 to 2015-16
359
Average
Assessed Est. No. of
Valuation No. of Pending Pending Appeals
Reduction Appeals Allowed
15.77�Y� 189 3O
Combined Value Under
Pendine Appeals
$ 623,732,8R5
402,209,739
330.(xi5.062
7,253.3U6
0
2,282,568
0
$1,365,543,560
�" Includes secured assessed valuations only.
Sc�urce: Fiscal Consultant's Rcport.
Estimated Reduction on
Pending Appeals
(FY 2017-18 AV)
$ I 5,236,000
9,826,OU0
8.063.000
O
0
55,000
0
$33,357.000
There are appeals pending for three of the largest property owners included in TABLE 4-"TEN
LARGEST TAXPAYERS." The Successor Agency cannot predict the outcome of any pending appeals.
For Fisca) Years 2009/10 to 2015/16, 14.3�Ic of all appeal filings were reduced or stipufated, 78.1 �'Ic of
the appeals were withdrawn or denied and 7.S�I� of the appeals remain open. For the period reviewed by the
Fiscal Consultant, properties that were the subject of assessment appeal filings resulted in an overall average
reduction in assessed value of ISJ7�/c This average reduction is incorporated by the Fiscal Consultant in the
projections of Tax Revenues. Scc APPENDiX C—"Fiscal Consultant's Report."
Pass-Through Agreements
Pursuant to prior Section 33401(b) of the Redevelopment Law, a redevelopment agency was authorized
to enter into an agreement to pay Tax Revenues to any Taxing Agency that has territory located within a Project
Area to alleviate any �nancial burden or detriment caused by the Project Areas. These agreements are
commonly referred to as "tax sharing agreements" or "pass-through agreements." Any payments made by the
Successor Agency to a Taxing Agency pursuant to a pass-through agreement shall be paid prior to the payment
of debt service on the Bonds; provided, however, payments on subordinated pass-through agreements shall not
be made prior to the payment of debt service on the Bonds if there are insufficient Tax Revenues to pay debt
service on the Bonds.
In addition, pursuant to former Section 33676 of the Redevelopment Law, any affected taxing agency
that had not entered into a tax sharing agreement with the redevelopment agency prior to the adoption of a
32
RESOLUTION NO. SA-RDA 062
redevelopment plan could elect, by resolution adopted prior to the adoption of a redevelopment plan, to receive
the portion of Tax Revenues attributed to one or both of the following:
(a) Increases in ihe rate of tax imposed for the benefit of t6e taxing agency which levy
occurs after the tax year in which the ordinance adopting the redevelopment plan becomes effective; and
(b) Increases in the assessed value of the taxable property in the redevelopment project
area, as the assessed value is established by the assessment roll last equatized prior to the effective date
of the ordinance adopting the redevelopment plan pursuant to sabdivision (a) of Section 33670, which
are, or otherwise would be, calculated annually pursuant to subdivision (� of Section 110.1 of the
Revenue and Taxation Code.
For a description of the Former Agency's Pass-Through Agreements, See APPENDIX C"Fiscal
Consultant's Report."
Since dissolution, the Coanty-Auditor-Controller caiculates and pays directly to the Taxing Agency any
amounts due under a Pass-Through Agreement.
Statutory Tax Sharing Payments
Certain provisions were added to the Redevelopment Law by the adoption of AB 1290 in 1994. If a new
redevelopmznt project was formed by a redevelopment plan adopted on or after January 1, 1994 or if new
territory was added to a redevelopment project on or after January 1, 1994, under Section 33607.5 of the
Redevelopment Law, any affected taxing entity, including the City, would share in the Tax Revenues generated
by such added area pursuant to a statutory formula ("Statutory Tax Sharing").
In addition, a redevelopment agency, on or after January I, 1994 amended a redevelopment pian to
delete the time limit to incur indebtedness in a redevelopment project (pursuant to Section 33333.6(e) of the
Redevelopment Law, as amended pursuant to SB 211) or increased the total amount of Tax Revenues to be
allocated to the project area or increased the duration of the Redevelopment Plan and the period for receipt of
tax increment, Statutory Tax Sharing is required under Section 33607.7 of the Redevelopment Law with all
affected Taxing Agencies not atready a party to a tax sharing agreement, once the original limitations were
reached.
The Successor Agency has not taken any proceedings to subordinate the payment of Statutory Tax
Sharing Amounts to the Bonds. With respect to moneys deposited in the RPTTF, the payment of Statutory Tax
Sharing amounts shall be made prior to the payment of debt service on the Bonds.
Since dissolution, the County Auditor-Controller calculates and pays directly to the taxing entities the
Statutory Tax Sharing amounts.
Outstanding Indebtedness
After refinancing the Refunded Bonds, the following obligations will be outstanding on a senior basis to
the Bonds:
• Palm Desert Financing Authority Tax Allocation Refunding Revenue Bonds (Project Area No. 1,
As Amended) 2007 Series A(the "2007 Series A PA 1 Bonds"), currently outstanding in the
principal amount of $ and maturing Apri1 1, 2018.
Concunently with the issuance of the Bonds, the Successor Agency will be issuing its Tax Allocation
Refunding Bonds 2017 Series H-A, in the principal amaunt of $ (the "2017 Series A Bonds") and
Taxable Tax Allocation Refunding Bonds 2017 Series H-B, in the principal amount of $ (the
"2017 Series B Bonds," and together with the 2017 Series A Bonds, the "2017 Housing Bonds")) to refund
certain outstanding housing obligations of the Successor Agency (the "Housing Refunded Bonds"). Under the
33
RESOLUTION NO. SA-RDA 062
indenture for the 2017 Housing Bonds, the piedge securing the 2017 Housing Bonds includes money deposited
in the RPTTF in an amount equal to the dollar amount that the Former Agency would have been required to
deposit into the Low and Moderate Income Housing Fund pursuant to Sections 33334.2 and 33334.3 of the Law,
if the Former Agency had not been dissolved, referred to in this Official Statement as the "Housing Portion."
See APP�NDIX C—"REPORT OF FISCAL CONSULTANT."
TAX REVENUES AND DEBT SERVICE COVERAGE
As shown in Table 7 and 8, the actual amounts received by the Successor Agency depends on the
realization of certain assumptions relating to the Tax Revenues. The Fiscal Consultant has projected taxable
valuation and Tax Revenues in the Project Areas. Table 7 retlects taxable value and Tax Revenues assuming no
growth on the tax base. Table 8 includes certain tax base growth assumptions as presented below. The
Successor Agency believes the assumptions upon which the projections are based are reasonable; however,
some assumptions may not materialize and unanticipated events and circumstances may occur (see "R1SK
FACTORS"). Therefore, the actual Tax Revenues received during the forecast period may vary from the
projections and the variations may be material and could affect the Successor Agency's ability to timely pay
principal of and in[erest on the Bonds.
Following is a discussion of assumptions used in the projection of Tax Revenues:
Baseline Assumption
(b) The values of unsecured personal property and state assessed utility property and the
amount of unitary revenues have been maintained throughout the projections at their 2016l17 levels.
(b) A tax rate of $1.0� per $100 of assessed value applied to the taxable property in the
Project Areas has been used to determine Tax Revenues.
(c) Projected Tax Revenues include a deduction for property tax collection administrative
costs charged by County.
(d) Projected Tax Revenues do not reflect delinquencies.
(e) Projected Tax Revenues do not reflect any potential future Proposition 8 adjustments.
(fj Projected Tax Revenues do not reflect any potential decreases resulting from pending
ass�;ssment appeals. See "THE PROJECT AREAS - Assessmenl Appeals"
(g) Projected Tax Revenues do not include supplemental property taxes.
(h) Projected Tax Revenues include a deduction for payments due to Taxing Agencies
under the Pass-Through Agreements and Tax Sharing Statutes, including subordinate payments.
(g) Projected Tax Revenues include � deduction for the Housing PoRion.
Growth Assumption for Table 8
(a) The secured roll is assumed to increase 2% annuaily for inflation. See "Property
Taxation in California - Manner in Which Property Valuations and Assessments are Determined (Article
XIIIA)."
(b) For the purposes of the projections, it is assumed that there will not be any value added
to the tax ro11s as a result of new construction or changes in property ownership.
34
RESOLUTION NO. SA-RDA 062
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RESOLUTION NO. SA-RDA 062
RISK FACTORS
The purchase of the Boncls invnlve,s investment risk. If a risk factor muteriuli�es tn a se ffrcie�it degree, it
could delay or prevent payment vf principul of and/or interest ai the Boncts. Such risk fuctors include, hut ure
not limited to, the fvlloK�ing mutters uncl should be cnnsicfered, ulong with other infvrmution in thi.r Officia!
Stutement, by� potentiul irrvestors.
Factors Which May Affect Tax Revenues
The ability of the Successor Agency to pay principal of and interest on the Bonds depends on the timely
receipt of Tax Revenues as projected in the Official Statement (see "TAX REVENUES AND DEBT SERVICE
COVERAGE"). Projections of Tax Revenues are based on the underlying assumptions relating to Tax Revenues
of the Project Areas. Tax Revenues allocated to the Successor Agency (which constitute the ultimate source of
payment of principal of and interest on the Bonds, es discussed in the Official Statement) are determined by the
amo�nt of incremental valuation of taxable property in the Project Areas, taxed at a rate of $ I.QO per $100 of
assessed value (17c) and the percentage of taxes collected in the Project Areas, adjusted to reflect prior claims
on the Tax Revenues. A number of factors which may affect Tax Revenues, and consequently result in a
reduction of Tax Revenues, are outlined below.
Reductions in Assessed Value. Tax Revenues allocated to the RPTTF are determined by the amount of
incremental taxable value in the Project Areas taxed at a ratc of $1.00 per $100 of assessed value (1 �I ). Thc
reduction of taxable values of property in the Project Areas caused by economic factors beyond the Successor
Agency's control, such as relocation out of the Project Areas by one or more major property owners, sale of
property to a non-profit corporation exempt from property taxation, or the complete or partial destruction of
such property caused by, among other eventualities, earthquake or other natural disaster, could cause a reduction
in the Tax Revenues that provide for the repayment of and secure the Bonds. Such reduction of Tax Revenues
could have an adverse effect on the Successor Agency's ability to make timely payments of principal of and
interest on the Bonds.
Article XIlIA. Pursuant to the California voter initiative process, on June 6, 1978, California voters
approved Proposition 13 which added Article XIIIA to the California Constitution. This amendment imposed
certain limitations on taxes that may be levied against real property to 1�Ic of the full cash value of the property,
adjusted annually for inflation at a rate not exceedina 29� annually. Full cash value is determined as of the
1975/76 assessment year, upon change in ownership (acquisition) or when newly construc[ed (see "- Property
Taxation in California" for a more eomplete ditcussion of Article XI11A). Article XIIIA has subsequently been
amended to permit reduction of the "full cash value" base in the event of declining property values caused by
substantial damage, destruction or other factors, and to provide that there would be no increase in the "full cash
va{ue" base in the event of reconstruction of property damaged or destroyed in a disaster and in other speci�l
circumstances.
Reduction in lnflationary Rate. The annual inFlationary adjustment, while limitcd to 27�, is determined
annually and may not exceed the percentage change in the California Consumer Price lndex (CCPI).
38
RESOLUTION NO. SA-RDA 062
Because the Revenue and Taxation Code does not distinguish between positive and negative changes in
the CCPI used for purposes of the inflation factor, there was a decrease of 0.237% in 2009/10 — applied to the
2010/l 1 taz roll — reflecting the actual change in the CCPI, as reported by the State Department of Finance. For
each fiscal year since Article XIIIA has become effective (the 1978/79 fiscal year), the annual increase for
inflation has been at least 2% except in nine fitical years as shown below:
Tax Roll Percentage
1981 /82 1.000%
1995/96 1.190
1996/97 1.110
1998/99 1.853
2004/OS I.867
2010/il (0.237)
2011/12 0.753
2014/15 0.454
2015/16 1.998
2016/17 1.525
Proposition 8 Adjustments. Proposition 8, approved in 1978, provides for the assessment of real
property at the lesser of its originally determined (base year) full cash value compounded annually by the
inflation factor, or its full cash value as of the lien date, taking into account reductions in value due to damage,
destruction, obsolescence or other factors causing a decline in market value. Reductions based on Proposition 8
do not establish new base year values, and the property may be reassessed as of the following lien date up to the
lower of the then-current fair market value or the factored base year vatue. The State $oard of Equalization has
approved this reassessment formula and such formula has been used by county assessors statewide. This
methodology has been approved by the Fourth District Couct of Appeals in a case in which the California
Supreme Court declined further review. See "PROPERTY TAXAT[ON IN CALIFORNIA:'
If Proposition 8 adjustments are made by the County Assessor in future years because of declines in the
fair market value of properties caused by the lack of real estate development in the area generally, Tax Revenues
may be adversely affected and as a possible consequence may have an adverse effect on the Successor Agency's
ability to pay debt service on the Bonds.
Assessment Appeals. Assessment appeals may be iiled by property owners seeking a reduction in the
assessed value of their property. After the property owner files an appeal, the County's Appeals Boazd will hear
the appeal and make a determination as to whether or not there should be a reduction in assessed value for a
panicular property and the amount of the reduction, if any. To the extent that any reductions are made to the
assessed valuation of such properties with appeals cunently pending, or appeals subsequently filed, Tax
Revenues, and correspondingly, Tax Revenues will be reduced. Such reductions may have an adverse effect on
the Successor Agency's ability to pay debt service on the Bonds. As of October 2016, there were 189 pending
appeals filed within the last five years by property owners within the Project Areas relating to $1,365,543,560 of
current year or prior years' assessed value (see "THE PROJECT AREAS - Assessment Appeals"). To the extent
these appeals are resolved in favor of the property owner, Tax Revenues will be reduced.
Earthquake, Flood and Other Risks. Any natural disaster or other physicai calamity, including
earthquake, may have the effect of reducing Tax Revenues through reduction in the aggregate assessed valuation
within the boundaries of the Project Areas.
Wildfires. The City is located in area where wildfires are a common occurrence. While there
have not been any wildfires in the City, the occurrence of any natural disaster or physical calamity,
including wildfires, floods, landslides and earthquakes, could result in damage within the Project Area�.
The occurrence of such events could adversely impact the value of rea! property in the Project Areas,
Tax Revenues, the economy of the City, and, accordingly, the ability of the Redevetopment Agency to
make timely payments of principal of and interest on the Bonds.
39
RESOLUTION NO. SA-RDA 062
FloodinQ. Flood zones are identified by the Federal Emergency Management Agcncy
("FEMA"). FEMA designates land located in a low- to moderate-risk flood zone {i.e. not in a
floodplain) as being within a Non-Special Flood Hazard Area (a "NSFHA"). FEMA defines an NSFHA
as an area that is in a low- to moderate-risk flood zone (i.e. not in a floodplain) and has less than a 1�lc
chance of flooding each year. The City is located within a NSFHA and severe, concentrated rainfall
couid result in localized flooding and river overflows. The City has adopted a Drainageway, Floodway,
and Watercourse Ordinance that regulates development in flood prone areas by preventing construction
in such areas. Development is permitted in these areas once floodflow hazards are eliminated. Areas in
the City that have received flood control improvements are those subject to potentially destructive
floods. Significant capital investments have been made in the community where these threats occur. The
City can make no representation that future maps will not be revised to include the City within ��n area
deemed subject to flooding. The occurrence of flooding in the Project Areas could result in a reduetion
in Tax Revenues. Such a reduction of Tax Revenues could have an adverse effect on the ability of the
Successor Agency ability to make timely payments of principal and interest on the Bonds.
Seismic Factors. Generally, seismic activity occurs on a regular basis in the State. Periodically,
the magnitude of a single seismic event can cause significant ground shaking and potentiai damage to
property located at or near the center of such seismic activity. The occurrence of severe seismic activity
in the City could result in damage to roads, infrastructure and other property within the Project Areas.
The occurrence of such a severe seismic could have a negative impact on assessed values of taxable
values of property in the Project Areas and could result in a reduction in Tax Revenues. Such a
reduction of Tax Revenues coutd have an adverse effect on the ability of the Successor Agency ability
to make timely payments of principal and interest on the Bonds.
Hazardous Substances. An additional environmenta! condition that may result in the reduction
in the assessed value of parcels would be the discovery of a hazardous substance that would limit the
beneficial use of a property within the Project Areas. In general, the owners and operators of a property
may be required by law to remedy conditions of the property relating to releases or threatened releases
of hazardous substances. The owner (or vperator) may be required to remedy a hazardous substance
condition of property whether or not the owner (or operator) has anything to do with creating or
handling the hazardous substance. The effect, therefore, should any of the property within the Project
Areas be affected by a hazardous substance would be to reduce the marketability and value of the
property, perhaps by an amount in excess of the costs of remedying the condition. The Successor
Agency can give no assurance that future development will not be limited by these conditions.
Certain Bankruptcy Risks. The enforceability of the rights and remedies of the Owners of the Bonds
and the obligations of the Successor Agency may become subject to the following: the federal bankruptcy code
and applicahle bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or affecting the
enforcement of creditors' rights generally, now or hereafter in effect; usual equitable principles which may limit
the specific enforcement under state law of certain remedies; the exercise by the United States of America of the
powers delegated to it by the federal Constitution; and the reasonable and necessary exercise, in certain
exceptional situations, of the police power inherent in the sovereignty of the State of California and its
govemmental bodies in the interest of servicing a significant and legitimate public purpose. Bankruptcy
proceedings, or the exercise of powers by the federal or state government, if initiated, could subject the Owners
of the Bonds to judicial discretion and interpretation of their rights in bankruptcy or otherwise and consequently
may entail risks of delay, limitation, or modification of their rights.
Limited Obligations. The Successor Agency has no power to levy and collect property taxes, and any
property tax limitation, legislative measure, voter initiative or provision of additional sources of income to
Taxing Agencies having the effect of reducing the property tax rate must necessarily reduce the amount of Tax
Revenues, and consequently, Tax Revenucs that would otherwise be available to pay the principal of, and
interest on the Bonds.
Interpretation ojand Future Changes in the Law; Voter Initiatives. The Redevelopment Law and the
Dissolution Act are complex bodies of law and their application to the Successor Agency, the Redevelopment
40
RESOLUTION NO. SA-RDA 062
Plan and the Project Areas may be subject to different interpretations by the Successor Agency, the Department
of Finance, the County Auditor-Controller, Taxing Agencies and other interested parties, including with respect
to Pass-Through Agreements and Statutory Tax Sharing obligations and enforceable obligations. Since the
effectiveness of the Dissolution Act, the State Department of Finance and various successor agencies have from
time to time disagreed about the interpretation of different language contained in the Dissolution Act, as well as
whether or not the Sta[e Department of Finance has exceeded its authority in rejecting items from ROPS
submitted by successor agencies, as evidenced by numerous lawsuits. While the Successor Agency has
covenanted in the Indenture to preserve and protect the security of the Bonds and the rights of the Bondholders
(see APPEIVDIX A—"SUMMARY OF CERTAIN PROVISIONS OF THE 1NDENTURE"), any such action
taken by the Successor Agency could incur substantial time and cost that may have a detrimental effect on the
Successor Agency's ability to timely pay debt service on the Bonds. Moreover, the Successor Agency cannot
guarantee the outcome of any such action taken by the Successor Agency to preserve and protect the security of
the Bonds and the rights of the Bondholders.
In addition to the existing limitations on Tax Revenues described in this Official Statement under
"PROPERTY TAXATION LN CALIFORNIA," the California electorate or Legislature could adopt future
limitations with the effect of reducing Tax Revenues payable to the Successor Agency.
Real Estate and General Economic Risks. Tax Revenues available for payment of any indebtedness of
the Successor Agency are based upon the latest actual assessed values for the 2016/17 Fiscal Year.
Redevelopment of real property within the Project Areas by the City, as well as private development in the
Project Areas, may be adversely affected by changes in general economic conditions, fluctuations in the real
estate markets and interest rates, unexpected increases in development costs, changes in or new governmental
policies including governmental policies to restrict or control certain kinds of development and by other similar
factors. If development and redevelopment activities in the Project Areas e�counters significant obstacles of the
kind described in the Official Statement or other impediments, the economy of the area in and around the
Project Areas could be adversely affected, causing reduced taxable valuation of property in the Project Areas a
reduction of the Tax Revenues and a consequent reduction in Tax Revenues available to repay the Bonds. Due
to the decline in the general economy of the region, owners of property within the Project Areas may be less
able or less willing to make timely payments of property taxes, causing a delay or reduction of Tax Revenues
and consequentiy a reduction in Tax Revenues available to repay the Bonds.
RecogniZed Obligation Payment Schedule. The Dissolution Act provides that only those payments
listed in the ROPS may be made by the Successor Agency from the funds cpecified in the ROPS. The
Dissolution Act requires successor agencies to prepare and approve, and submit to the successor agency's
oversight board and the State Department of Finance for approval, a ROPS pursuant to which enforceable
obligations (as defined in the Dissolution Act) of the successor agency are listed, together with the source of
funds to be u�ed to pay for each enforceable obligation. Tax Revenues will not be distributed from the RPTTF
by the County Auditor-Controller to the Successor Agency's Redevelopment Obligation Retirement Fund
withoat a duly approved and effective ROPS obtained in sufficient time prior to the January 2 or June 1
distribution dates, as applicable. See "SECUR[TY FOR THE BONDS - Recognized Obligation Payment
Schedules." tn the event the Successor Agency were to fail to file a ROPS with respect to any six-month period,
the availabiiity of Tax Revenues to the Successor Agency could be adversely affected for such period.
The Successor Agency has covenanted to take all actions required under the Dissolution Act to include
scheduled debt service on the Bonds as well as any amount required under the Indenture to replenish the
Reserve Account of the Debt Service Fund, in ROPS for each six-month period of a Fiscal Year and to enable
the County Auditor-Controller to distribute from the RPTTF to the Successor Agency's Redevelopment
Obligation Retirement Fund on each January 2 and June 1 amounts required for the Successor Agency to pay
principal of, and interest on, the Bonds coming due in the respective six-month period of a Fiscal Year,
including listing a reserve on the ROPS to the extent required by the Indenture or when the next property tax
allocation is projected to be insufficient to pay all obligations due under the provisions of the Bonds for the next
payment due in the following six-month period (see APPENDIX A—"SUMMARY OF CERTAIN
PROVISIONS OF THE INDENTURE").
41
RESOLUTION NO. SA-RDA 062
The Dissotution Act also contains certain penalties in the event ihe Successor Agency dces not timely
submit a Recognized Obligation Payment Schedule for a Fiscal Year. Specifically, a ROPS must be submitted
by the Successor Agency, after approval by the Oversight Board, the County Auditor-Controller, the State
Department of Finance, and the State Controller no later than February 1 of eaeh year. If the Successor Agency
does not submit an Oversight Board-approved ROPS by such deadlines, the City wifl be subject to a civil
penalty equal to $10,000 per day for every day the schedule is not submitted to the State Department of Finance.
Additionally, the Successor Agency's administrative cost allowance is reduced by 25�Ic if the Suecessor Agency
does not submit an Oversight Board-approved ROPS by the lOth day after the February 1 deadline with respect
to a ROPS for the subsequent annual period.
The Successor Agency has submitted all ROPS, duly approved by the Oversight Board, in a timely
manner.
2017 Series A Bonds Loss of Tax Exemption. As discussed under the caption "LEGAL
MATTERS - Tax Matters," interest on the 2017 Series A Bonds could become includable in gross income for
purposes of federal income taxation retroactive to the date the 2017 Series A Bonds were executed and delivered
as a result of future acts or omissions of the Successor Agency in violation of its covenants contained in the
Indenture. Should such an event of taxability occur, the 2017 Series A Bonds are not subject to special
redemption or any increase in interest rate and will remain outstanding until maturity.
In addition, Congress has considered in the past, is currently considering and may consider in the future,
legislative proposals, including some that carry retroactive effective dates, that, if enacted, would alter or
eliminate the exclusion from gross income for federal income tax purposes of interest on municipal bonds, such
as the 201? Series A Bonds. Prospective purchasers of the 2017 Series A Bonds should consult their own tax
advisors regarding any pending or proposed federal tax legislation. The Successor Agency can provide no
assurance that federal tax law will not change while the 2017 Series A Bonds are outstanding or that any such
changes witl not adversely affect the exclusion of the interest on the 2017 Series A Bonds from gross income for
federal income tax purposes. If the exclusion of [he interest on the 2017 Series A Bonds from gross income for
federal income tax purposes were amended or eliminated, it is likcly that the market price for the 2017 Series A
Bonds would be adversely imp�tcted.
IRS Audit of Tax-Exempt Bond Issues. The Intemal Revenue Service has initiated an expanded
program for the auditing of tax-exempt bond issues, including both random and targeted audits. It is possible
that the 2017 Series A Bonds will be selected for audit by the Interndl Revenue Service. Ii is also possible that
the market value of the 2017 Series A Bonds might be affected as a result of such an audit of the 2017 Series A
Bonds (or by an audit of similar bonds).
Secondary Market. There can be no guarantee that there will be a secondary market for the Bonds or, if
a secondary market exists, that such Bonds can be sold for any particular price. Occasionally, because of general
market conditions or because of adverse history or economic prospects connected with a particular issue,
secondary marketing practices in connection with a particular istiue are suspended or terminated. Additionally,
prices of issues for which a market is being made will depend upon then prevailing circumstances. Such prices
could be substantially different from the original purchase price.
LEGAL MATTERS
Enforceability of Remedies
The cemedies availablc to the Trustee and the Owners of the Bonds upon an event of default under the
Indenture or any other document described in the Official Statement are in many respects dependent upon
regulatory and judicial actions which are often subject to discretion and delay. Under existing law and judicial
decisions, the remedies provided for under such documents may not be readily available or may be limited. The
various legal opinions ro be delivered concurrently with the delivery of the Bonds will be qualified to the extent
that the enforceability of ceRain legal rights related to the Bonds and the Indenture are subject to limitations
42
RESOLUTION NO. SA-RDA 062
imposed by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors
generally and by eqaitable remedies and proceedings generally.
Approval of Gegal Proceedings
Richards Watson & Gershon, A Professional Corporation, as Bond Counsel, will render opinions with
respec[ to the Bonds which state that the lndenture is a valid and binding obligation of the Successor Agency
and enforceable in accordance with its terms. 7'he legal opinions of Bond Counsel will be subject to the effect of
bankruptcy, insolvency, moratorium and other similar laws affecting creditors' rights and to the exercise of
judicial discretion in accordance with general principles of equity. See "APPENDIX F" for the proposed forms
of Band Counsel's opinions with respect to the Bonds.
The Successor Agency has no knowledge of any fact or other information which would indicate that the
Indenture is not so enforceable against the Successor Agency, except to the extent such enforcement is limited
by principles of equity and by state and federal laws relating to bankruptcy, reorganization, moratorium or
creditors' rights generally.
Certain legal matters will be passed on for the Successor Agency by Richards Watson & Gershon, A
Professional Corporation, Los Angeles, California, as Successor Agency Counsel. Best Best & Krieger LLP,
Riverside, California, will also pass on certain legal matters for the Successor Agency as Disclosure Counsel.
Certain lega) matters will be passed on for the Underwriter by its counsel, Stradling Yocca Carlson & Rauth, A
Professional Corporation, Newport Beach, California. Fees payable to Bond Counsel, Disclosure Counsel and
Underwriter's Counsel are contingent upon the sale and detivery of the Bonds.
Tax Matters
2017 Series A Bonds
The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements which
must be met subsequent to the issuance and delivery of the 2017 Series A Bonds for interest thereon to be and
remain excluded from gross income for federal income tax purposes. Noncompliance with such requirements
could cause interest on the 2017 Series A Bonds to be inctuded in gross income for federal income tax purposes
retroactive to their date of issue. These requirements include, but are not limited to, provisions which limit how
the proceeds of the 2017 Series A Bonds may be spent and invested, and generally require that certain
investment earnings be rebated on a periodic basis to the United States of America. The Successor Agency has
made certifications and representations and has covenanted to maintain the exclusion of the interest on the 2017
Series A Bonds from gross income for federal income tax purposes pursuant to Section 103(a) of the Code.
In the opinion of Richards, Watson & Gershon, A Professional Corporation, Bond Counsel, under
existing law and assuming the accuracy of such certifications and representations by the Successor Agency and
compliance with such covenants, (i) interest on the 2017 Series A Bonds is excluded from gross income for
federal income tax purposes under Section 103 of the Code, and (ii) the 2017 Series A Bonds are not "specified
private activity bonds" within the meaning of Section 57(a)(5) of the Code and, therefore, interest on the 2017
Series A Bonds is not a preference item for purposes of computing the alternative minimum tax imposed by
Section 55 of the Code. Bond Counsel is also of the opinion that interest on the 2017 Series A Bonds is exempt
from State of Califomia personal income taxes. Bond counsel expresses no opinion as to any other tax
consequences regarding the 2017 Series A Bonds.
Under the Code, a portion of the interest on the 2017 Series A Bonds earned by certain corporations
may be subject to a federal corporate alternative minimum tax. In addition, interest on the 2017 Series A Bonds
may be subject to a federal branch profits tax imposed on certain foreign corporations doing business in the
United States and to a federal tax imposed on ezcess net passive income of certain S corporations. The
exclusion of interest from gross income for federal income tax purposes may have certain adverse federal
income tax consequences on items of income, deduction or credit for certain taxpayers, including financial
institutions, certain insurance companies, recipients of Social Security and Railroad Retirement benefits, those
43
RESOLUTION NO. SA-RDA 062
deemed to incur or continue indebtedness to acquire or c�-ry tax-exempt obligations, and individuals eligible for
the earned income tax credit. Bond Counsel will express no opinion regarding these and other such
consequences.
Bond Counsel has nvt undertaken to advise in the future whether any circumstances or events occurring
after the date of issuance of the 2U17 Series A Bonds may affect the tax status of interest on the 2017 Series A
Bonds. Legislation affecting tax-exempt obligations is regularly considered by the United States Congress and
may also be considered by the State legislature. Court proceedings may also be �led, the outcome of which
could modify the tax treatment of obligations such as the 2017 Series A Bonds. No assurance can be given that
legislation enacted or proposed, or actions by a court, after the date of issuance of the 2017 Series A Bonds, will
not contain provisions which could eliminate, or directly or indirectly reduce the benefit of the exclusion of
interest on the 2017 Series A Bonds from gross income for federal income tax purposes, or have an adverse
effect on the market value or marketability of the 2017 Series A Bonds.
For example, recent presidential and legislative proposals would eliminate, reduce or otherwise alter the
tax benefits currently provided to certain owners of state and local government bonds, including proposals that
would result in additional federal income tax on taxpayers that own tax-exempt obligations if their incomes
exceed certain thresholds. Investors in the 2017 Series A Bonds should be aware that any such fuwre legislative
actions (including federal income tax reform) may retroactively change the treatment of all or a portion of the
interest on the 2017 Series A Bonds for federal income tax purposes for all or certain taxpayers. ln such event,
the market value of the 2017 Series A Bonds may be adversely affected and the ability of holders to sell their
2017 Series A Bonds in the secondary market may be reduced. The 2017 Series A Bonds are not subject to
special mandatory redemption, and the interest rates on the 2017 Series A Bonds are not subject to adjustment,
in the event of any such change.
Investors should consult their own financial and tax advisors to analyze the importance of these risks.
Certain requirements and procedures contained or referred to in relevant documents may be changed
and certain actions may be taken, under the circums[ances and subject to the termti and conditions set forth in
such documents, upon the advice or with the approving opinion of nationally recognized bond counsel. Bond
Counsel expresses no opinion as to any 2017 Series A Bond, or the interest thereon, if any such ehange occurs
or action is taken upon the advice or dpproval of bond counsel other than Richards, Watson & Gershon, A
Professional Corporation.
If the issue price of a 2017 Series A Bond (the first price at which a substantial amount of the bonds of a
maturity are to be sold to the public) is less than the stated redemption price at maturity of such 2017 Series A
Bond, the difference constitutes original issue discount, the accrual of which is excluded from gross income for
federal income tax purposes to the same extent as interest on the 2017 Series A Bonds. Further, such original
issue discount accrues actuarially on a constant yield method over the term of each such 2017 Series A Bond
and the basis of each 2017 Series A Bond acquired at such initial offering price by an initial purchaser thereof
will be increased by the amount of such accrued original issue discount. The accrual of original issue discount
may be taken into account as an increase in the amount of tax-exempt income for purposes of detennining
various other tax consequences of owning such 2017 Series A Bonds. Purchasers who acquire 2017 Series A
Bonds with original issue discount are advised that [hey should consult with their own independent tax advisors
with respect to the state and local tax consequences of owning such 2017 Series A Bonds.
If the issue price of a 2017 Series A Bond is greater than the stated redemption price at maturity of such
2017 Series A Bond, the difference constitutes original issue premium, the amortization of which is not
deductible from gross income for federal income tax purposes. Original issue premium is amortized over the
period to maturity of such 2017 Series A Bond based on the yield to maturity of that Bond (or, in the case of a
2017 Series A Bond callable prior to itti stated mat�rity, the amortization period and yield may be required to be
determined on the basis of an earlier call date that results in the lowest yield on that 2017 Series A Bond),
compounded semiannually. For purposes of determining gain or loss on the sale or other disposition of such
2017 Series A Bond, the purchaser is required [o decrease such purchaser's adjusted basis in such 2U17 Series A
Bond by the amount of premium that has amortized to the date of such sale or other disposition. As a result, a
44
RESOLUTION NO. SA-RDA 062
purchaser may realize taxable gain for federal income tax purposes from the sale or other disposition of such
2017 Series A Bond for an amount equal to or less than the amount paid by the purchaser for that 2017 Series A
Bond. A purchaser of that 2017 Series A Bond in the initial public offering at the issue price for that 2017 Series
A Bond who holds it to maturity (or, in the case of a callable 2017 Series A Bond, to its earlier call date that
results in the lowest yield on that 2017 Series A Bond) will realize no gain or loss upon its retirement.
Payments ot' interest on tax-exempt obligations, inctuding the 2017 Series A Bonds, are generally
subject to IRS Form 1099-INT information reporting requiremcnts. If an owner of a 2017 Series A Bond is
subject to backup withholding under those requirements, then payments of interest will also be subject to backup
withholding. Those requirements do not affect the exclusion of such interest from gross income for federal
income tax purposes.
Prospective purchasers of the 2017 Series A Bonds should consult their own independent tax advisers
regarding pending or proposed federal and state tax legislation and court proceedings, and prospective
purchasers of the 2017 Series A Bonds at other than their original issuance at the respective prices indicated on
the inside front cover of this Official 5tatement should also consult their own tax advisers regarding other tax
considerations such as the consequences of market discount, as to all of which Bond Counsel expresses no
opinion.
Bond Counsel's engagement with respect to the 2017 Series A Bonds ends with the issuance of the 2017
Series A Bonds, and, unless separately engaged, Bond Counsel is not obligated to defend the Successor Agency
or the owners of the 2017 Series A Bonds regarding the tax status of interest thereon in the event of an a�dit
examination by the IRS. The IRS has a program to audit tax-exempt obligations to determine whether the
interest thereon is includible in gross income for federal income tax purposes. lf the IRS does audit the 2017
Series A Bonds, under current IRS procedures, the IR5 will treat the Successor Agency as the taxpayer and the
beneficial owners of the 2017 Series A Bonds will have only limited rights, if any, to obtain and participate in
judicial review of such audit. Any action of the IRS, including but not limited to selection of the 2017 Series A
Bonds for audit, or the course or result of such audit, or an audit of other obligations presenting similar tax
issues, may affect the market value of the 2017 Series A Bonds.
2017 Series B Bonds
ln the opinion of Richards, Watson & Gershon, A Professionul Corporation, Bond Counsel, under
existing law, interest on the 2017 Series B Bonds is exempt from State of California personal income taxes.
Bond Counsel expresses no opinion as to any other tax consequences regarding the 2017 Series B Bonds.
Interest on the 2017 Series B Bonds is not excluded from gross income for federal income tax purposes.
The legal defeasance of the 2017 Series B Bonds may result in a deemed sale or exchange of the 2017
Series B Bonds under certain circumstances; owners of the 2017 Series B Bonds should consult their own tax
advisors as to the federal income tax consequences of such an event. Prospective purchasers of the 2017 Series
B Bonds should also consult with their own tax advisors as to the federal, state and local, and foreign tax
consequences oj their acquisition, ownership and disposition of the 2017 Series B Bonds. If a beneficial
owner of a 2017 Series B Bond fails to provide its taxpayer identification number or fails to report all interest on
its federal income tax returns, payments of principal and interest made on the 2017 5eries B Bond will be
subject to backup withholding. Beneficial owners of the 2017 Series B Bonds should consult their tax advisors
with respect to this and other tax consequences of ownership of the 2017 Series B Bonds.
The following discussion is generally limited to "U.S. owners," meaning beneficial owners of 2017
Series B Bonds that for United States federal income tax purposes are individua! citizens or residents of the
United States, corporations or other entities taxable as corporations created or organized in or under the laws of
the United States or any state thereof (including the District of Columbia), and certain estates or trusts with
specific connections to the United States. Partnerships holding 2017 Series B Bonds, and partners in such
partnerships, should consult their own tax advisors regarding the tax consequences of an investment in the 2017
Series B Bonds (including their status as U.S. owners).
45
RESOLUTION NO. SA-RDA 062
Certain of the 2017 Series B Bonds (Discount Bonds) may be offered and sold to the public at an
original issue discount (OID). OID is the exccss of the stated redemption price at maturity (the principal
amount) over the "issue price" of such bonds, provided that excess equals or exceeds a statutory de minimis
amount (one-quarter of one percent of the bond's stated redemption price at maturity multiplied by the number
of complete years to its maturity, or if required by applicuble Treasury Regulations, to an earlier call date). The
issue price of a Diseount Bond is the initial offering price to the public (other than to bond houses, brokers or
similar persons acting in the capacity of underwriters or wholesalers) at which a substantial amount of the
Discount Bonds of the same maturity are sold pursuant to that offering. For federal income tax purposes, OID
accrues to the owner of a Discount Bond over the period to maturity based on the constant yield method,
compounded semiannually (or over a shorter permitted compounding interval selected by the owner). The
portion of OID that accrues during the time a U.S. owner owns a Discount Bond (i) constiwtes interest
includable in the U.S. owner's gross income for federal income tax purposes and (ii) is added to the U.S. owner's
tax basis for purposes of determining gain or loss on the maturity, redemption, prior sale, or other disposition of
the Discount Bond. The effect of OID is to accelerate the recognition of taxable income during the term of the
Discoun[ Bond.
Certain of the 2017 Series B Bonds (Premium Bonds) may be offered and sold to the public at a price in
excess of their stated redemption price (the principal amount) at maturity. If a U.S. owner purchases a Premium
Bond, that owner will be considered to have purchased such a Prernium Bond with "amortizable bond premium"
equal in amount to such excess. The U.S. owner may elect (and that election wil) apply to all securities
purchased at a premium by such U.S. Owner), in accordance with the applicable provisions of Section 171 of
the Code, to amortize that premium as an offset to the interest payments on the Premium Bond using a const�nt
yield to maturity method over the remaining term of the Premium Bond (or, if required by applicablc Treasury
Regulations, to an earlier call date). Pursuant to Section 67(b)(1 1) of the Code, the amortization of that
premium is not considered a miscellaneous itemized deduction. Any amortization of bond premium will reduce
the basis of the Premium Bond pursuant to Section 1016(a)(5) of the Code.
Owners of Discount or Premium Bonds (or book entry interests in them) should consult their own tax
advisers as to the determination for federal tax purposes of the amount of OID or amortizable bond premium
properly accruable in any period with respect to the Discount or Premium Bonds and as to other federal tax
consequences and the treatment of OID and amortizable bond premium for purposes of state or local t�xes on
(or based on) income.
General information reporting requirements will apply to payments of principal and interest made on
2017 Series B Bonds and the proceeds of the sale of 2017 Series B Bonds to non-corporate owners, and "backup
withholding" at a rate of 289c will apply to such payments if the owner fails to provide an accurate taxpayer
identification number in the manner required or fails to report all interest required to be shown on its federal
income tax returns. A beneficial owner oF 2017 Series B Bonds that is a U.S. owner generally can obtain
complete exemption from backup withholding by providing a properly completed IRS Form W-9 (Request for
Taxpayer ldentification Number and Certi�cation).
For taxable years beginning after Uecember 31, 2012, a U.S. owner that is an individual or estate, or a
trust not included in a special class of trust that is exempt from such tax, is subject to a 3.8 percent Medicare tax
on the lesser of (i) the U.S. owner's "net investment income" for the taxable year, and (ii) the excess of the U.S.
owner's modified adjusted gross income for the taxable year over a certain threshold (which in the case of
individuals is between $125,000 and $250,000, depending on the individual's circumstances). A U.S. owner's
net investment income generally includes interest income on, and net gains from the disposition of, 2017 Series
B Bonds, unless such interest income or net gains are derived in the ordinary course of a trader business (other
than a trader business that consists of certain passive or trading activities). A U.S. owner that is an individual,
estate, or trust, should consult its tax advisor regarding the applicability of the Medicare tax.
2017 Series B Bonds — Non-U.S. Owncrs
Under the Code, interest and OIU on any 2017 Series B Bond whose beneticial owner is not a U.S.
owner are generally not subject to United States income tax or withholding tax (including backup withholding)
46
RESOLUTION NO. SA-RDA 062
if the non-U.S. owner provides the payor of interest on the 2017 Series B Bonds with an appropriate statement
as to its status as a non-U.S. owner. This statement can be made on IRS Form W-8BEN or a successor form. If,
however, the non-U.S. owner conducts a trade or business in the United States and the interest or OID on the
2017 Series B Bonds held by the non-U.S. owner is effectively connected with such trade or business, that
interest or OID will be subject to United States income tax bot will generally not be subject to United States
withholding tax (including backup withholding). The foregoing is a brief summary of certain federal income tax
consequences to a non-U.S. owner. Non-U.S. owners should consult their own tax advisors regarding the tax
consequences of an investment in the 2017 Series B Bonds.
2017 Series B Bonds — Foreien Account Tax Compliance Act
The Foreign Account Tax Compliance Act ("FATCA") generally imposes a 30 percent withholding tax
on interest payments and proceeds from the sale of interest-bearing obligations for payments made after the
relevant effective date to (i) certain foreign financial institutions that fail to certify their FATCA status, and (ii)
investment funds and non-financial foreign entities if certain disclosure requirements related to direct and
indirect United States shareholders and/or United States account holders are not satisfied}
Under applicable Treasury Regulations, the FATCA withholding tax of 30 percent will generally be
imposed, subject to certain exceptions, on payments of (i) interest on 2017 Series B Bonds on or after July I,
2014, and (ii) gross proceeds from the sale or other disposition of other 2017 Series B Bonds on or after January
1, 2017, where such payments are made to persons described in the preceding paragraph.)
In the case of payments made to a"foreign financial institution" (generally including an investment
fund), as a beneficial owner or as its intermediary, the FATCA withholding tax generally wi11 be imposed,
subject to certain exceptions, unless such institution (i) enters into (or is otherwise subject to) and complies with
an agreement with the United States govemment (a "FATCA Agreement"), or (ii) is required by and complies
with applicable foreign law enacted in connection with an intergovernmental agreement between the United
States and a foreign jurisdiction (an "IGA"), in either case to, among other things, collect and provide to the
United States or other relevant tax authorities certain information regarding United States account holders of
such institution. In the case of payments made to a foreign entity that is not a financial institution (as a beneficial
owner), the FATCA withholding tax generally will be imposed, subject to certain exceptions, unless such entity
either provides the withholding agent with a certification that it does not have any "substantial" United States
owner (generally, in a specified United States person that directly or indirectly owns more than a specified
percentage of such entity) or identifies its "svbstantial" United States owners.
If 2017 Series B Bonds are held through a foreign financial institution that enters into (or is otherwise
subject to) a FATCA Agreement, such foreign financial institution (or, in certain cases, a person paying amounts
to such foreign financial institutions) generally will be required, subject to certain exceptions, to withhold the 30
percent FATCA tax on payments of dividends or the items described above made to (i) a person (including an
individual) that fails to comply with certain information requests, or to relies (ii) a foreign financial institution
that has not entered into (and is not otherwise subject to) a FATCA Agreement and that is not required to
comply with FATCA pursuant to applicable foreign law enacted in connection with an IGA. Coordinating rules
may limit duplicative withholding in cases where the withholding described above in "Non-U.S. Owners" or
back-up withholding described above also applies.
If any amount of, or in respect of, United States withholding tax were to be deducted or withheld from
payments on 2017 Series B Bonds as a result of a failure by an investor (or by an institution through which an
investor holds the 2017 Series B Bonds) to comply with FATCA, none of the Successor Agency, the Trustee,
any paying agent or bond registrar nor any otfier person would, pursuant to the terms of the 2017 Series B
Bonds, be required to pay additional amounts with respect to any 2017 Series B Bond as a result of the
deduction or withholding of such tax. Non-U.S. Owners should consult their [ax advisors regarding the
application of FATCA to thc ownership and disposition of 2017 Series B Bonds.
47
RESOLUTION NO. SA-RDA 062
Form of Bond Counsel Opinions
A copy of each of the proposed forms of Bond Counsel's final approving opinions with respect to the
2017 Series A Bonds and the 2017 Series B Bonds are attached hereto as Appendix F.
No Litigation
There is no action, suit or proceeding known to the Successor Agency to be pending and notice of which
has been served upon and received by the Successor Agency, or threatened, restraining or enjoining the
execution or delivery of the Bonds or the Indenture or in any way contesting or affecting the validity of the
foregoing or any proceedings of the Successor Agency taken with respect to any of the foregoing.
CONCLUDIIYG INFORMATION
Ratings on the Bonds
S&P Global Ratings has assigned an uninsured rating of "_" to the Bonds. Such rating reflect only the
views of S&P Global ratings, and any desired explanation of the significance of such ratings may be ohtained
from such rating agency at the following address: S&P Global Ratings, 55 Water Street, 1Vew York, New York
10041, (212) 438-20(}0. Generally, a rating agency bases its rating on the information and materials furnished to
it and on invcstigations, studies and assumptions of it� own.
There is no a�s�rance such ratings will continue for any given period of time or that such ratings will
not be revised downward or withdrawn entirely by the rating agency, if in the judgment of such rating �gency,
circumstances so warr�►nt. Any such downward revision or withdrawal of such ratings may have an adverse
effect on the market price of the Bonds. Except as otherwise required in the Continuing Disclosure Certificate,
the Successor Agency undertakes no responsibility eithcr to bring to the attention of the owncrs of any Bonds
any downward revision or withdrawal of any rating obtained or to oppose any such revision or withdrawal. A
rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at
any time.
7'he Municipal Advisor
The Successor Agency has retained Del Rio Advisors, LLC of Modesto, California, as municipal
advisor (the "Municip�l Advisor") in connection with the offering of the Bonds. All financial and other
information presented in this Official Statement has been provided by the Successor Agency and others from
their records. Unless otherwise footnoted, the Municipal Advisor takes no responsibility for the accuracy or
completeness of the data provided by the Successor Agency or others and has not undertaken to make an
independent verification or does not assume responsibility for the accuracy, completeness, or fairness of thc
information contained in this Official Statement. The Municipal Advisor has assisted the Successor Agency
with the structure, timing and terms for the sale of the Bonds. The Municipal Advisor provides mu�icipal
advisory services only and does not engage in the underwriting, marketing, or trading of municipal securities or
other negotiable instruments. The fee of the Municipal Advisor is not contingent upon the successful closing of
the Bonds.
Continuing Disclosure
The Successor Agency will provide annually certain fnancial information and data relating to the Bonds
by not later than April 1 in each year commencing April l, 2018 (the "Annual RepoR"}, and to provide notices
of the occurrence of certain other listed events. Willdan Group, Inc. will act as Dissemination Agent. The
specific nature of the information to be contained in the Annual Report or the notices of listed events and certain
other terms of the continuing disclosure obligation are found in the form of the Successor Agency's Disclosure
Certificate attached in APPENDIX E—"FORM UF CONTINUING DISCLOSURE CERTIFICATE."
48
RESOLUTION NO. SA-RDA 062
The Former Agency entered into previous continuing disclosure undertakings with respect to its bond
obligations. [A review of compliance with continuing disclosure undertakings for filings required by the
S�ccessor Agency and its related entities within the past five years indicates that the Successor Agency and its
related entities failed to timely disclose one rating change in 2013. The Successor Agency is currently in
compliance with its continuing disclosure obligations. The Successor Agency has adopted continuing disclosure
compliance policies.]
Underwriting
The Bonds were sold to Stifel, Nicolaus & Company, Incorporated (the "Underwriter"), who is offering
the Bonds at the prices set forth on the inside cover pages hereof. The initial offering prices may be changed
from time to time and concessions from the offering prices may be allowed to dealers, banks and others.
The Underwriter has purchased the 2017 Series A Bonds at a price equal to $ , which
amount represents the principal amount of the 2017 Series A Bonds plus a net original issue premium of
$ , less an Underwriter's discount of $ . The Underwciter has purchased the 2017 Series
B Bonds at a price equal to $ , which amount represents the principal amount of the 2017 Series B
Bonds less an original issue discount of $ , less an Underwriter's discount of � . The
Underwriter will pay certain of its expenses relating to the offering from the Underwriter's discount.
Addition al I nform ation
The summaries and references contained in the Official Statement with respect to the Indenture, the
Bonds, statutes and other documents, do not purport to be comprehensive or definitive and are qualified by
reference to each such document or statute and references to the Bonds are qualified in their entirety by
reference to the form hereof included in the Indenture. Copies of this document may be obtained after delivery
of the Bonds from the Successor Agency at 73510 Fred Waring Drive, Palm Desen, California 92260.
References
All statements in this Official Statement involving matters of opinion, whether or not expressly so
stated, are intended as such and not as representations of fact. This Official Statement is not to be construed as a
contract or agreement between the Successor Agency and the purchasers or Owners of any of the $onds.
Execution
The execution and delivery of this Official Statement by the Executive Director of the Successor
Agency has been duly authocized by the Successor Agency.
SUCCESSOR AGENCY TO THE PALM DESERT
REDEVELOPMENT AGENCY
By:
Lauri Aylaian, Executive Director
49
RESOLUTION NO. SA-RDA 062
APPENDIX A
SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE
A-1
RESOLUTION NO. SA-RDA 062
APPENDIX B
CITY OF PALM DE5ERT INFORMATION
GENERAL ECONOMIC DATA CONCERNING
THE CITY OF PALM DESERT AND THE COUNTY OF RIVERSIDE
The follotiving informution concerning the City of Palm Desert, the Counh• of Riversicle und surrounding
areu.ti� is included only for the pe�rpose of supply�ing general informatinn regarding the communit}�.
Overview
The City of Palm Desert (the "City"), incorporated in 1Vovember 26, 1973 as a general law city, became
a charter city through the adoption of Ordinance 858 by the City Council on January 8, 1998. The City is
located in the Coachella Valley and is approximately mid-way between the cities of Indio and Palm Springs, 117
miles east of Los Angeles, 118 miles northeast of San Diego and 515 miles southeast of San Francisco.
The City occupies an area of approximately 26 square miles. Elevation of the City is 243 feet and the
mean temperature is 73.1 degrees. Except in summer, the weather is mild and annual average rainfall is 338
inches. According to the State Department of Finance, the City population as of January 1, 2016 was
approximatety 49,355.
Government
The City Council is comprised of five members, elected at large for four-year staggered terms every two
years. The general municipal election is conducted in November of even-numbered yeats, consolidated with the
Statewide General Election and councilmembers are sworn in and take office at the first meeting in December
following each election.
The City Council selects one of its members to serve as Mayor for a one-year term and appoints a City
Manager ro conduct the day to day business of the City and the City Clerk. The City Attorney is appointed by
City Council. The City operates as "Contract City" utilizing, primarily, agreements with other governmental
entities, private companies and individuals to provide services. Contracted services include police and fire
protection provided through the County, animal control, health services, legal services and landscape
maintenance.
Table B-1
CITY OF PALM DESERT
CITY COUNCIL MEMBERS
Name Ot�ice
Jan Harnik Mayor`
Sabby Jonathan Mayor Pro Tem"
Kathleen Kelly Councii Member-elect
Gina Nestande Council Member-elect
Susan Marie Weber Council Member
Population
Between 2010 and 2016, the city's population increased by a total of 890 or approximately 1.83�Io. In
addition to permanent residents, the city has approximately 32,000 seasonal residential residents who live three
` Subjcct to City Council reorganization after election certification on Dccember 8, 2016
B-1
RESOLUTION NO. SA-RDA 062
to six months in the City, primarily during the winter months. Table B-3 iilustrates the population of the City,
the County and the State for 1990, 2000, and 2010 through 2016.
Table B-2
CITY OF PALM DESERT
POPULATION ESTIMATES
The State of California, County of Riverside
and the City of Palm Desert
(As oF January 1 of Each Year)
Year
anuar 1
1990` '
2000"'
2010`�'
2011
2012
2013
2014
2015
2016
City of
Palm Desert
23,252
41,155
48,445
48,957
48,924
48,282
48,494
48,835
49,335
Riverside
Countv
1,170.413
I ,545,387
2,189,641
2,2I2,874
2,239,715
2,266,549
2,291,093
2,317,924
2,347,828
State of
California
29,758,213
33,873,086
37,253,956
37,536,835
37,88 I ,357
38,239,207
38,567,459
38,907,642
39,255,883
"' As of April l.
Sources: United States Department of Commcrce, Burcau of thc Census for 2010 and Statc of Calil'ornia
Department of Finance for remaining ycars.
Labor Force and Employment
The main sources of revenue in the City are derived from tourism and sales tax. Historically, the
unemployment rate in the City has been lower than that for the County and the State.
�
RESOLUTION NO. SA-RDA 062
Table B-3 table represents the labor patterns in the City, the County, the State, and the United States
from 2012 through 2016.
Table B-3
CITY OE PALM DESERT, RIVERSIDE COUNTY,
STATE OF CALIFORNIA AND UNITED STATES
CIVILIAN LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT
Year and Area
2012
City
County
State
United States
2013
City
County
State
United States
2014
City
County
State
United States
2015
City
County
State
United States
2016
City�2j
County�2j
,
State�-'
United States" �
Labor Force
21,800
988,600
18,551,400
154,975,000
22,200
998,800
18,670,100
155,389,000
22,600
1,017,000
18,827,900
I 55,922,000
23,200
1,035,200
18,981,800
157,130,000
23,500
1,051,100
19,357,900
159,907,000
Emplovment
20,000
873,600
16,627,800
142,469,000
20,600
899,900
17,001,000
143,929,000
21,300
933,800
17,418,000
146,300,000
22,000
965,000
17,798,600
148,834,000
22,400
978,900
18,281,600
151,968,000
Unemplovment
1,800
115,100
1,183,200
12,506,000
1,600
98,900
l ,669,000
1 I ,460,000
1,300
83,200
1,409,900
9,617,000
1,100
69,600
1,183,200
8,296,000
1,100
72,200
i ,076,300
7,939,000
Unemployment
Rate
8.41 �7c
11.6
10.4
8.1
7.1
9.9
8.9
7.4
5.8
8.2
7.5
6.2
4.8
6.7
6.2
5.3
4.9
6.9
5.6
5.0
"' As of September.
�'' As of August.
Sourccs: State of California Employmcnt Development Department and U.S. Department of Labor. Bureau of Labor
Statistics.
I�
RESOLUTION NO. SA-RDA 062
Table B-4
CITY OF PALM DESERT
MAJOR EMPLOYERS
(As of October 2015)
Comaanv
I. JW Marriott - Descrt Springs Rcsort & DS Villas
2. Universal Protcctian Services
�i. Securitas - Security Scrvicc USA
4. Avida Carcgivcrs - P. Descrt
5. Sunshinc Landscapc
6. Walmart
7. Macys
8. CVWD
9. Bighorn Golf Club
10. Costco
Product/Service
Commcrcial Hotel, Timeshare & Retail
Sccurity Services
Security Scrviccs
Homc Hcalthcare
Gardcning/[.andscaping Scrvicc
RctaiUStore
Retail/Storc
Municipal Watcr District
Golf Course/Country Club
Retail Warchoutir
Number of
Emalovees
2,3(k3
1,5W
700
550
scx�
350
350
325
250
250
Sources: City of Palm Desert Comprehcnsive Annual Financial Report for Fiscal Ycar ended Junc 30, 2OI5.
Commercial Activity
A sales tax is imposed on retail sale or consumption of personal property. Sales tax revenues are
determincd by the total taxable transactions within a jurisdiction and distributed by the State Board of
Equalization to the jurisdiction where the sale took place. Sales taxes collected from merchants with no
permanent place of business (i.e., manufacturers, construction contractors, etc.) are accumulated to a
Countywide or State-wide (out-of-state businesses) pool and distributed to cities and counties in proportion to
their collection from all sales taxpayers.
The value and volume of these taxable transactions are dependent on economic conditions and other
factors. Such factors included the level of inflation affecting the price of goods and services subject to the sales
tax, the rate of population growth in the general area, the characteristics of retail developments, such as the
relative size of market service areas, the sensitivity of the types of businesses within the City to changes in the
economy, and competing retail establishments outside the City. A deterioration of economic conditions and
other factors influencing taxable sales generated in the City, may reduce the City's sales tax revenucs. The table
below summarizes taxable transactions in the City for calendar years 2010 through 2014.
:•
RESOLUTION NO. SA-RDA 062
Table B-5
CITY OF PALM DESERT
TAXABLE RETAIL SALES DATA
Calendar Years 2010 to 2014
($ in 000's)
Retail and Food Services
Motor Vehicle and Pazts Dealers
Home Furnishings and Appliance Stores
Bldg. Matrl. and Garden Equip. and Supplies
Food and Beverage Stnres
Gasoline Stations
Clothing and Clothing Acccssories Stores
Generat Merchandise Stores
Food Scrvices and Drinking Placcs
Other Retail Group
Total Retail and Food Services
All Other Oudets
Total All Outlets
��� Last yeaz available.
Sources: Statc Board of Equalization.
Utilities
2010
b 17,472
95,561
63,999
47,242
70,512
172,869
340,762
I SO.U93
I 32.548
$1,09 l ,059
$ 175,775
$1,266,834
2011
6 19,115
91,246
6R.214
48.002
90,431
193,087
366,913
162, 864
142,704
1 182 576
$ 201,633
$1,384,20R
2012
� 20, 309
95,997
76,241
48,776
92,684
202,706
379.856
174,101
152,229
$1,242,899
228 083
$1,470,982
2013
� 22,955
95,108
77,714
56,448
93,064
211,465
382.224
188,056
156,276
$ l ,283,310
$ 247,203
$1,530,512
2014�"
$ 22.780
104,568
80.577
68.378
87,049
253.187
356,366
197,374
I 68,455
$1.338,734
� 256,020
$1,594,753
Water, sewage treatment and wastewater disposal are provided by the Coachella Valley Water District.
Southern California Gas Company supplies natural gas to the City and electric power is provided by the
Southern California Edison Company. Telephone service is available through Frontier. Cable television service
is provided by Spectrum.
Transportation
Inter-City transportation is provided by Sunline Bus System which provides service throughout the
entire Coachella Va11ey. The City's central highways are California Highway 111 and 74 which connect to US
Interstate 10 and to California Highway 63 and 86.
Shipping is provided by numerous truck carriers which have overnight service to Los Angeles, San
Francisco, San Diego and Phoenix. Rail transportation is provided by the Southern Pacific Railroad located in
Indio, 10 miles east of the City, and by Amtrak, which has two stations located in Coachelia Valley.
A full service airport is located in Paim Springs, 12 miles northwest of the City, with approximately
seven carriers providing service. The airport has an 8,500 foot runway and general aviation facilities. There is
also a private airport in Bermuda Dunes, eight miles northeast of the City.
Community Services
The City of Palm Desert provides both police and fire protection through contracts with [he County of
Riverside.
The Riverside County Public Library System provides library services to the City. The City/County also
operates a 43,000 square foot public library on the College of the Desert campus which is jointly used by the
public and the College of the Desert.
B-S
RESOLUTION NO. SA-RDA 062
Income
The following table shows per capita income for the City, County, and State for calendar years 2006
through 2015.
Table B-6
CITY OF PALM DESERT
PER CAPITA PERSONAL iNCOME"�
County of Riverside and State of California
Year
2006
zoo�
2008
2009
2010
2011
2()12
2013
2014
2U15
City of
Palm Desert
542339
az,x��
47,919
48,069
48,286
51,940
52,336
52,613
5 2,906
S:�,U31
County of
Riverside
�31,203
3 I ,586
:� I ,497
29,869
29,753
:i 1.073
3 I .879
32,503
33,590
n/a
Calitornia
$41,69:i
4i, I 82
4:i,786
41,588
42,411
44,852
47,614
48, I 25
49,9R5
n/a
Sciurcc: City of Palm Dcsert Comprchensive Annual Financial Report for Fiscal Year ended lunc 3U, 2015;
U.S. Ucpartment of Commcrcc Bunnau of Economic Analysis.
Education, Culture and Recreation
Public school education is provided by the Desert Sands Unified School District (the "School District").
The School District provides preschool through grade 12 education to students living in the City and the �
communities of Indian Wells, Indio, La Quinta, Rancho Mirage and Bermuda Dunes. The School District and
operates seven elementary schools, six middle schools, three comprehensive high schools, one independent
study alternative school and a continuation high school.
The College of the Desert, the Coachella Valley Community College is located in the City.
A satellite campus of California State University, San Bernardino ("CSUSB") is located approximately
five miles northeast of City Hall. In 2002, the first building on thc campus, the Mary Stuart Rogers Gateway
Building, was constructed and occupied. In 2005 two additional buildings were constructed and occupied which
included a three story classroom building and the Indian Wells Theater, a 300-seat performing arts center.
The University of California, Riverside has also established a campus in the City. The UCR Palm Desert
Graduate Center opened as a permanent satellite campus in 2005, when construction was completed on the
approximately 21,200 square foot Richard J. Heckmann International Center for Entrepreneurial Management
and an approximately 23,600 square foot educational facility.
Cultural facilities in the City include the 1,127 seat MeCallum Theater for the Performing Arts located
in Bob Hope Culwral Center, the 1,200 acre Living Desert Zoo and Gardens, the Palm Springs Art Museum,
which includes an 8,400 square foot exhibit building and a 250,000 square foot sculpture garden, and the Art in
Public Places (a museum without walls featuring more than 130 works of art throughout the City).
Recreation programs for residents of the City and other neighboring communities arc offcred through
the Coachella Valley Recreation and Park District (the "Park District"). The Park District provides ncreetional
activities and programs ranging from tiny tots programs, kids clubs and summer day camp, to dance, health and
fitness and music inswction, to the senior games.
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RESOLUTION NO. SA-RDA 062
Thc Desert Willow Golf Resort, two championship 18-hole, public golf course, is located on
approximately 540 acres in the northern area of the City. This golf course also features a 33,000 square foot
clubhouse with restaurant, dining and banquet facilities. The City also is home to five other public golf courses
and resorts and 20 private or semi-private golf clubs and resorts.
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RESOLUTION NO. SA-RDA 062
APPENDIX C
FISCAL CONSULTANT'S REPORT
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RESOLUTION NO. SA-RDA 062
APPENDIX D
CITY OF PALM DESERT AUDITED
FINANCIAL STATEMENTS FOR THE FISCAL
YEAR ENDED JUNE 30, 2015
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RESOLUTION NO. SA-RDA 062
APPENDIX E
FORM OF CONTINUING DISCLOSURE CERTIFICATE
This CONTINUING DISCLOSURE CERTIFICATE (the "Disclosure Certificate") is executcd and
delivered by the Successor Agency to the Palm Desert Redevelopment Agency (the "Issuer") in connection with
the issuance of its Tax Allocation Refunding Bonds, 2017 Series A and Taxable Tax Allocation Refunding
Bonds, 2017 Series B(the "Bonds"). The Bonds are being issued pursuant to an Indenture of Trust, dated as of
l, 2017, by and between U.S. Bank National Association, as trustee (the "Trustee") and the Issuer
(the "Indenture"). The Issuer covenants and agrees as follows:
Section 1. Purpose of this Disclosure Certificate. This Disclosure Certificate is being executed and
delivered by the Issuer for the benefit of the Beneficial Owners and bondholders in order to assist thc
Participating Underwriter in complying with Securities and Exchange Commission Rule 15c2-12.
Section 2. Definitions. In addilion to the definitions set forth in the tndenture, which apply to any
capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following
capitalized terms shall have the following meanings:
"Annua! ReporP' shall mean any Annual Report provided by the Issucr pursuant to, and as describcd in,
Sections 3 and 4 of this Disclosure Certificate.
"Befieficial Owner" shall mean any person which (a) has the power, directly or indirectly, to vote or
consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through
nominees, dcpositories or other intermediaries), or (b) is treated as the owner of any Bonds for federal income
tax purposes.
"Disseminutivn Agent" shall mean Willdan Group. I�c., or any successor Dissemination Agent
designated in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation.
In the absence of such a designation, the Issuer shall act as the Dissemination Agent.
"EMMA" or "Electronic Municipul Market Access'' means the centralized on-line repository system
located at www.emma.msrb.org for documents fited with the MSRB pursuant to the Rule, such as of�cial
statements and disclosure information relating to municipal bonds, notcs and other securities ati issucd by state
and local governments.
"Listed Events" shall mean any of the events listed in Section 5(a) and (b) of this Disclosure Certificate.
"MSRB" means the Municipal Securities Rulemaking $oard, which has been designated by the
Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule,
or any other repository of disclosure information which may be designated by the Securities and Exchange
Commission as such for purposes of thc Rule in the future.
"Purticiputing Undenrriter" shall mean Stifel, Nicolaus & Company, Incorporated, or any of the
original undcrwriters of the Bonds required to comply with the Rule in connection with offering of the Bonds.
"Ri�le" shall mean Rule 15c2-12 adopted by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as the same may be amended from time to time.
"Stute" shall mean the State of California.
"State Repository�" shall mean any public or private repository or entity designated by the State as a statc
repository for the purpose of the Rule. As of the date of this Ccrtificate, there is no State Repository.
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RESOLUTION NO. SA-RDA 062
Section 3. Provision of Annual Reports.
(a) Delivery of Annuul Report to MSRB. The Issuer shall, or shall cause the Dissemination
Agent to, not later than [April 1] in each year, commencing [April 1, 2018] and to file with EMMA, in a
readable PDF or other electronic format as prescribed by the MSRB, an Annual Report that is consistent
with the requirements of Section 4 of this Disclosure Certificate; provided however, that the first Annual
Report due on [April 1, 2018] shall consist solely of a copy of the Official Statement. The Annual
Report may be submitted as a single document or as separate documents comprising a package, and may
cross-reference other informa[ion as provided in Section 4 of this Disclosure Certificate; provided, that
the audited financial statements of the Issuer may be submitted separately from the balance of the
Annual Report and later than the date requircd above for the filing of the Annual Report if they are not
available by that date.
(b) Change nf Fiscal Year. If the Issuer's iiscal year changes, it shall give notice of such
change in the same manner as for a Listed Event under Section 5(d).
(c) Delivery of Annual Report tu Dissemination Agent. Not later than five days prior to the
date specified in subsection (a) for providing the Annual Report to EMMA, the Issuer shall provide the
Annual Report to the Dissemination Agent (if other than the Issuer). If by such date, the Dissemination
Agent has not received a copy of the Annual Report, the Dissemination Agent shall notify the Issuer.
(d) Report of Non-Compliance. If the Issuer is unable to provide an Annual Report by the
date required in subsection (a), the Dissemination Agent shall send a notice to EMMA in a timely
manner in an electronic fortnat prescribed by ihe MSRB.
(e) Anrttta! Compliunce Certlfication. The Dissemination Agent shall, if the Dissemination
Agent is other than the Issuer, file a report with the Issuer certifying that the Annual Report has been
provided pursuant to this Disclosure Certificate, stating the date it was provided.
Section 4. Content of Annual Reports. The Issuer's Annual Report shall contain or incorporate by
reference the following:
(a) Audited financial statements of the lssuer for the preceding fiscal year, prepared in
accordance with the laws of the State and including all statements and information prescribed for
inclusion therein by the Controller of the State. If the Issuer's audited financial statements are not
available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual
Report shall contain unaudited financial statements in a format similar to the financial statements
contained in the final Official Statement, and the audited financial statements shall be filed in the same
manner as the Annual Report when they become available. The audited Financial Statements of the
Issuer may be included in the City of Palm Desert's Comprehensive Annual Financial Report if no
separate Financial Statement is prepared for the Issuer.
(b) To the extent not included in the audited final statement of the Issuer, the Annual
Report shall also include the following information for the prior fiscal year, insofar as available from
public records:
(i) Table No. 3- Historical Assessed Valuations;
(ii) Table No. 4- Ten Largest Taxpayers;
(iii) Table Nos. 6— Projected Tax Revenues with regard to current fiscal year
revenue; and
(iv) Table No. 8- Debt Service Coverage with regard to current fiscal year revenue.
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RESOLUTION NO. SA-RDA 062
(c) Any or all of the items listed above may be included by specific reference to other
documents, including official statements of debt issues of the lssuer or related public entities, which are
available to the public on the MSRB's Internet web site or filed with the Securities and Fxchange
Commission. The Issuer shall clearly identify each such other document so included by reference.
If the document included by reference is a final official statement, it must be available from
EMMA.
(d) In addition to any of the information expressly required to be provided under paragraph
(b) of this Section 4, the Issuer shall provide such further information, if any, as may be necessary to
make the specifically required statements or information (as set forth herein), in the light of thc
circumstances under which they are made, not misleading.
Section 5. Reporting o�gnificant Events.
(�) Reportcchle Events. The Issuer shall, or shall cause the Dissemination (if not the
Agency) to, give notice of the occurrence of any of the following events with respect to the Bonds (in
accordance with (e) below);
( I) Principal and interest payment delinquencies.
(2) Unsrheduled draws on debt service reserves reflecting financial difficulties.
(3) Unscheduled draws on credit enhancements reflecting financial difficulties.
(4) Substitution of credit or liquidity providcrs, or their failure to perform.
(5) Defeasances.
(6) Rating changes.
(7) Tender offers.
(8) Bankruptcy, insolvency, r�ceivership or similar event of the obligated person.
(9) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed
or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the security, or other material
events affecting the tax status of the security.
(b) Muterial Reportuble Events. The Issuer shall give, or cause to be given, notice of thc
occurrence of any of the following events with respect to the Bonds, if material:
(1) Non-payment related defaults.
(2) Modifications to rights of security holders.
(3) Bond calls.
(4) The release, substitution, or sale of property securing repayment of the
securities.
(5) The consummation of a merger, consolidation, or acquisition involving an
obligated person or the sale of all or substantially all of the assets of the obligated person, other
than in the ordinary course of business, the entry into a definitive agreement to undertake such
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RESOLUTION NO. SA-RDA 062
an action or the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms.
(6) Appointment of a successor or additional trustee, or the change of name of a
trustee.
(c) Determination of Materiality ojListed Events. Whenever the Issuer obtains knowledge
of the occurrence of a Listed Event listed under Section 5(b), the Issuer shall as soon as possible
determine if such event would be material under applicable federal securities laws.
(d) Notice to Dissemination Agent. If the Issuer has determined that knowledge of the
occurrence of a Listed Event listed under Section 5(b) would be material under applicable federal
securities laws, the Issuer shall promptly notify the Dissemination Agent (if other than the Issuer) in
writing. Such notice shall instruct the Dissemination Agent to report the occurrence pursuant to
subsection (d).
(e) Notice of Listed Events. The Issuer shall file, or cause the Dissemination Agent to file, a
notice of the occurrence of a Listed Event listed in Section 5(a), and, listed in Section 5(b), if material,
with EMMA, in a readable PDF or other electronic format as prescribed by the MSRB, in a timely
manner not in excess of ten (10) business days after the occurrence of the Listed Event. Notwithstanding
the foregoing, notice of Listed Events described in subsections (a)(5) and (b)(3) need not be given under
this subsection any earlier than the notice (if any) of the underlying event is given to Owners of affected
Bonds.
Section 6. IdentifyinQ Information for Filings with EMMA. All documents provided to EMMA
under this Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB.
Section 7. Termination of Reporting Obli ag tion. The Issuer's obligations under this Disclosure
CeRificate shall terminate upon the defeasance, prior redemption or paymeat in full of all of the Bonds.
Section 8. Dissemination Agent.
(a) Appointment of Di.r.seminatinn Agent. The initial Dissemination Agent shall be Willdan
Group, Inc. The Issuer may, from time to time, appoint or engage a different Dissemination Agent to
assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such
agent, with or without appointing a successor Dissemination Agent. If the Dissemination Agent is not
the Issuer, the Dissemination Agent shall not be responsible in any manner for the content of any notice
or report prepared by the Issuer pursuant to this Disclosure Certificate.
(b) Compensatirni nf Dissemination Agent. The Dissemination Agent, if not the Issuer, shall
be paid compensation by the Issuer for its services provided hereunder in accordance with its schedule
of fees as agreed to between the Dissemination Agent and the Issuer from time to time and all expenses,
legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties
hereunder. The Dissemination Agent shall not be deemed to be acting in any fiduciary capacity for the
Issuer, Owner or Beneficial Owners, or any other party. The Dissemination Agent may rely and shall be
protected in acting or refraining from acting upon any direction from the lssuer or an opinion of
nationally recognized bond counsel. The Dissemination Agent may at any time resign by giving written
notice of such resignation to the Itsuer.
Section 9. Amendment: Waiver. Notwithstanding any other provision of this Disc(osure
Certificate, the lssuer may amend this Disclosure Certificate (and the Dissemination Agent shall agree to any
amendment so requested by the Issuer that does not impose any greater duties or risk of liability on the
Dissemination Agent), and any provision of [his Disclosure Certificate may be waived, provided that the
following conditions are satisfied:
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RESOLUTION NO. SA-RDA 062
(a) Chunge in Circarmstances. If the amendment or waiver relates to the provisions of
Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstanccs that arises
f'rom a change in legal requirements, change in law, or change in the identity, nature, or status of an
obligated person with respect to the Bonds, or the type of business conducted;
(b) Con:pliance u,s uf Issue Date. The undertaking, as amended or taking into account such
waiver, would, in the opinion of a nationally recognized bond counsel, have complied with the
requirements of the Rule at the time of the original issuance of the Bonds, after taking into account any
amendments or interpretations of the Rule, as well as any change in circumstances; and
(c) Consent of Owners: Non-impuirment Opinion. The amendment or waiver either (i) is
approved by the Owners in the same manner as provided in the indenture for amendments to the
Indenture with the consent of Owners, or (ii) does not, in the opinion of nationally recognized bond
counsel, materialty impair the interests of the Owners or Beneficial Owners.
[f this Disclosure Certificate is amended or any provision of this Disclosure Certiiicate is waived, thc
Issuer shall describe such amendment or waiver in the next following Annual Report and shall include, as
applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in
the case of a change of accounting principles, on the presentation) oi financial information or operating data
being presented by the lssuer. In addition, if the amendment relates to the accounting principles to be followed
in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed
Event under Section 5(d), and (ii) the Annual Report for the year in which the change is made should present a
comparison (in narrative form and also, if feasiblc, in quantitative form) between the financial staterr�nts as
prepared on the basiti of the new accounting principles and those prepared on the basis of the former accounting
principles.
Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to
prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this
Disclosure Certificate or any other means of communication, or including any other information in any Annual
Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure
Certificate. If the Issuer chooses to include any information in any Annual Report or notice of occurrence of a
Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have
no obligation under this Disclosure Certificate to update such information or inelude it in any future Annu�l
Report or notice of occurrence of a Listed Event.
Section 11. Default. In the event of a failure of the Issuer [o comply with any provision of this
Disclosure Certificate, any Owner or Beneficial Owner may take such actions as may be necessary and
appropriate, inc{uding seeking mandate or specific performance by court order, to cause the Issuer to comply
with its obligations under this Disclosure Certi�icate. The sole remedy under this Disclosure Certit"icate in the
event of any failure of the Issuer to comply with this Disclosure CeRificate shall be an action to compel
performance.
Section 12. Duties, Immunities and Liabilities of Dititiemination A�nt. The Dissemination Agent
shall have only such duties as are speci�cally set forth in this Disclosure Certificate, and the Issuer agrees to
indemnify and save the Dissemination Agent, and its officers, directors, employees and agents, harmless against
any loss, expense and liabilities which it may incur arising out of the disclosure of information pursuant to the
Disclosure CeRificate or arising out of or in the exercise of performance of its powers and duties hereunder,
including the costs and expenses (including attorneys' fees) of defending against any claim of liabiliry, but
excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The Dissemination
Agent shall have no duty of obligation to review any information provided to it hereunder and shall not be
deemed to be acting in any fiduciary capacity for the tssuer, the owner of a Bond, or any other party. The
Trustee shall have no liability to any party for any monetary damages or other financial liability of any kind
whatsoever related to or arising from any breach of this Disclosure Certificate. No person shall have any right to
commence any action against the Dissemination Agent seeking any remedy other than to compel specific
performance of this Disclosure Certificate. The Dissemination Agent may rely and shall be protected in acting
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RESOLUTION NO. SA-RDA 062
or refraining from acting upon any written direction from the Issuer or an opinion of Special Counsel. The
obligations of the Issuer under this Section shall survive resignation or removal of the Dissemination Agent or
the Trustee and payment of the Bonds.
Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer,
the Dissemination Agent, the Participating Underwriter and Owners and Beneficial Owners from time to time of
the Bonds, and shall create no rights in any other person or entity.
Dated: , 2017 SUCCESSOR AGENCY TO THE PALM DESERT
REDEVELOPMENT AGENCY
By:
ACCEPTED BY DISSEMINATION AGENT
By: _
Title:
Lauri Aylaian
Executive Director
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RESOLUTION NO. SA-RDA 062
APPENDIX F
PROPOSED FORMS OF BOND COUNSEL OPINIONS
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APPENDIX G
THE BOOK-ENTRY SYSTEM
The following description of the Depository Trust Compuny ("DTC"), the procedures and record
keeping with respect to beneficial ownership interests in the Bonds, payment of principal, interest and other
payments on the Bonds to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial
ownership interest in the Bonds and other related transactions by and between DTC, the DTC Participants and
the Beneficial Owners is based solely on information provided by DTC. Accordingly, no representations can be
made concerning these matters and neither the DTC Participants nor the Beneficial Owners should rely on the
foregoing information with respect to such matters, but should instead confirm the same with DTC or the DTC
Participants, as the case may be.
Neither the issuer of the Bond� (the "Issuer") nor the trustee, fiscal agent or paying agent appointed with
respect to the Bonds (the "Agent") take any responsibility for the information contained in this Appendix.
No assurances can be given that DTC, DTC Participants or Indirect Participants will distribute [o the
Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the Bonds, (b)
certificates representing ownership interest in or other confirmation or ownership interest in the Bonds, or (c)
redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the Bonds, or
that they will so d� on a[imely basis, or that DTG, DTC Participants or DTC Indirect Participants will act in the
manner described in this Appendix. The current "Rules" applicable to DTC are on �le with the Securities and
Exchange Commission and the current "Procedures" of DTC to be followed in dealing with DTC Participants
are on file with DTC.
1. The Depository Trust Company ("DTC"), New York, NY, will act as securities
depository for the securities (the "Securities"). The Securities will be issued as fuqy-registered securities
registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be
requested by an authorized representative of DTC. One fully-registered Security certificate will be
issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be
deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million,
one certificate will be issued with respect to each $500 million of principal amount, and an additional
certificate will be issued with respect to any rem�ining principal amount of such issue.
2. DTC, the world's largest securities depository, is a limited-purpose trust company
organized under the New York Banking Law, a"banking organization" within the meaning of the New
York Banking Law, a member of the Federal Reserve System, a"clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a"clearing agency" registered pursuant to
the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset
servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt
issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct
Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct
Participants of sates and other securities transactions in deposited securities, through electronic
computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates
the need for physical movement of securities certificates. Direct Participants include both U.S. and non-
U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other
organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation
("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed
income Clearing Corporation> al1 of which are registered cicaring agencies. DTCC is owned by thc
users of its regulated subsidiaries. Access to the DTC system is also available to others such as both
U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that
clear through or maintain a cus[odial relationship with a Direct Panicipant, either directly or indirectly
("Indirect Participants"). DTC has a Standard & Poor's rating of AA+. The DTC Rules applicable to its
Participants are on file with the Securities and Exchange Commission. More information about DTC
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RESOLUTION NO. SA-RDA 062
can be found at www.dtcc.com. The information contained on such Internet site is not incorporatcd
herein by reference.
3. Purchases of Securities under the DTC system must be made by or through Direct
Participants, which will receive a credit for the Securities on DTC's records. The ownership interest of
each actual purchaser of each Security ("Beneficial Owner") is in turn to be recorded on the Direct and
Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of
their purchase. Beneficial Owners are, however, expected to receive written eonfirmations providing
details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect
Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership
interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect
Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates
representing their ownership interests in Securities, except in the event that use of the book-entry system
for the Securities is discontinued.
4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with
DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may
be requested by an authorized representative of DTC. The deposit of Securities with DTC and their
registration in the name of Cede & Co. or such other UTC nominee do not effect any change in
beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC's
records reflect only the identity of the Direct Participants to whose accounts such Securities are credited,
which may or may not be the Beneficial Owners. The Direct and indirect Participants will remain
responsible for keeping account of their holdings on behalf of their customers.
5. Conveyance of notices and other communications by DTC to Direct Participants, by
Direct Partieipants to Indirect Participants, and by Direct Participants and Indirect Participants to
Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take
certain steps to augment the transmission to them of notices of significant events with respect to the
Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents.
For example, Beneficial Owners of Securitieti may wish to ascertain that the nominee holding the
Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the
alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and
request that copies of notices be provided directly to them.
6. Redemption notices sha() be sent to DTC. If less than all of the Securities within an
issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of cach Uirect
Participant in such issue to be redeemed.
7. Neither DTC nor Cede & Co. (nor any other UTC nominee) will consent or vote with
respect to Securities unless authorized by a Direct Participant in accordance with DTC's MMI
Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to issuer es soon as possible after
the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct
Participants to whose accounts Securities are credited on the record date (identified in a listing attached
to the Omnibus Proxy).
8. Redemption proceeds, distributions, and dividend payments on the Securities will be
made to Cede & Co., or such other nominee as may be requested by an authorized representative of
DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and
corresponding detail information from Issuer or Agent, on payable date in accordance with their
respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be
governed by standing ins[ructions and customary practices, as is the case with securities held for the
accounts of customers in bearer form or registered in "street name," and will be the responsibility of
such Participant and not of DTC, Agent, or Issuer, subject to any statutory or regulatory requirements as
may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend
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RESOLUTION NO. SA-RDA 062
payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of
DTC) is the responsibility of Issuer or Agent, disbursement of such payments to Direct Participants will
be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the
responsibility of Direct and Indirect Participants.
9. DTC may discontinue providing its services as depository with respect to the Securities
at any time by giving reasonable notice to lssuer or Agent. Under such circumstances, in the event that a
successor depository is not obtained, Security certificates are required to be printed and delivered.
10. Issuer may decide to discontinue use of the system of book-entry transfers through DTC
(or a successor securities depository). In that event, Security certificates will be printed and delivered to
DTC.
I 1. The information in this section concerning DTC and DTC's book-entry system has been
obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the
accuracy thereof.
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