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HomeMy WebLinkAboutRes 05-40 and 502 Issue Bonds for Portola Avenue BridgeCITY OF PALM DESERT/PALM DESERT REDEVELOPMENT AGENCY STAFF REPORT REQUEST: APPROVAL OF CITY COUNCIL RESOLUTION NO. 05-40, DECLARING ITS INTENT TO ISSUE BONDS OR OTHER OBLIGATIONS OR CAUSE BONDS OR OTHER OBLIGATIONS TO BE ISSUED TO FINANCE THE INSTALLATION AND CONSTRUCTION OF THE PORTOLA AVENUE BRIDGE AND REIMBURSE CERTAIN EXPENDITURES FROM THE PROCEEDS OF THE BONDS APPROVAL OF REDEVELOPMENT AGENCY RESOLUTION NO. 502, DECLARING ITS INTENT TO ISSUE BONDS OR OTHER OBLIGATIONS OR CAUSE BONDS OR OTHER OBLIGATIONS TO BE ISSUED TO FINANCE THE INSTALLATION AND CONSTRUCTION OF THE PORTOLA AVENUE BRIDGE AND REIMBURSE CERTAIN EXPENDITURES FROM THE PROCEEDS OF THE BONDS SUBMITTED BY: DENNIS M. COLEMAN REDEVELOPMENT/HOUSING FINANCE MANAGER DATE: JUNE 9, 2005 CONTENTS: CITY COUNCIL RESOLUTION NO. 05-40 REDEVELOPMENT AGENCY RESOLUTION NO. 502 Recommendation: 1. That the City Council approves Resolution No. 05- 40 , declaring its intent to issue bonds or other obligations or cause bonds or other obligations to be issued to finance the installation and construction of the Portola Avenue Bridge and reimburse certain expenditures from the proceeds of the bonds. 2. That the Redevelopment Agency approves Resolution No. 502 , declaring its intent to issue bonds or other obligations or cause bonds or other obligations to be issued to finance the installation and construction of the Portola Avenue Bridge and reimburse certain expenditures from the proceeds of the bonds. Executive Summary: Approval of the resolutions allow the Agency to reimburse any funds expended on the Portola Avenue Bridge with bond funds and retain the original flexibility of the funds for private activity. Discussion: The City has identified the Portola Avenue Bridge to be a vital improvement for safety and other W lAgenda Items12005-Jun 918onds to Flnance Portola Ave BrrdgelPortola Badge Bond Rermb ‘,'pd Staff Report Approval of City Council and Redevelopment Agency Resolutions Approving Payment for the installation and construction of the Portola Avenue Bridge June 9, 2005 Page 2 concerns. It has been identified as a project to receive funding through the Measure A Program with the Coachella Valley Association of Governments (CVAG). On May 26, 2005, the City Council and the Redevelopment Agency approved resolutions that enables the Agency to pay for the construction and installation of the Portola Avenue Bridge. The Agency may initially expend its cash for this project and reimburse this expenditure with a future bond issue. The Agency plans on issuing bonds for this in March 2006. The attached resolutions will allow the Agency to reimburse the cash expended with bond funds. The resolution would also allow the Agency to spend the reimbursed bond funds as if they were tax increment funds, thereby restoring financial flexibility to the Agency. Staff has attached the resolutions which make these findings. Staff is recommending that the City Council and the Redevelopment Agency approve their respective resolutions. Submitted By: Department Head: Dennis M. Coleman David Yrigoyen Redevelopment/Housing Finance Manager Director of Redevelopment/Housing DMC:mh Approval: Justin McCarthy Paul S. Gibson ACM, Redevelopment Director of Finance/Treasurer Carlos L. Ortega Executive Director W lAgenda Items12005-Jun 918onds to Flnance Portola Ave BrrdgelPortola Badge Bond Rermb 'pd RESOLUTION NO. 05-40 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT DECLARING ITS INTENT TO ISSUE BONDS OR OTHER OBLIGATIONS OR CAUSE BONDS OR OTHER OBLIGATIONS TO BE ISSUED TO FINANCE THE INSTALLATION AND CONSTRUCTION OF THE PORTOLA AVENUE BRIDGE AND TO REIMBURSE CERTAIN EXPENDITURES FROM PROCEEDS OF THE BONDS RECITALS: A. The City Council of the City of Palm Desert (the "City") intends to issue bonds or other obligations (the "Bonds"), or cause Bonds to be issued, to finance the costs of the installation and construction of the Portola Avenue Bridge and appurtenant work (the "Project"). B. The City or the Palm Desert Redevelopment Agency (the "Agency") expects to expend moneys (other than moneys derived from the issuance of bonds or other obligations) on expenditures relating to the costs of the Project prior to the issuance of the Bonds. All expenditures will be properly chargeable to a capital account under general federal income tax principles. The City and the Agency reasonably expect to reimburse such capital expenditures with the proceeds of the Bonds. C. The City and the Agency expect that the maximum principal amount of Bonds which will be issued to pay for the costs of the Project (and related issuance costs) will not exceed $6, 000, 000.00. D. At the time of the reimbursement, the City and the Agency will evidence the reimbursement in a writing which identifies the allocation of the proceeds of the Bonds for the purpose of reimbursing the City or Agency for the capital expenditures made prior to the issuance of the Bonds. E. The City and the Agency expect to make the reimbursement allocation no later than 18 months after the later of (i) the date on which the earliest original expenditure for the Project is paid or (ii) the date on which the Project is placed in service (or abandoned), but in no event later than three years after the date on which the earliest original expenditure for the Project is paid. F. The City and the Agency will not, within one year of the reimbursement allocation, use the proceeds of the Bonds received in the reimbursement allocation in a manner that will result in the creation of replacement proceeds of the Bonds or another issue (e.g., the City and the Agency will not pledge or use the proceeds received for the payment of debt service on the Bonds or another issue, except that the proceeds of the Bonds can be deposited in a bona fide debt service fund). RESOLUTION NO. 05-40 G. This Resolution is intended to be a "declaration of official intent" in accordance with Section 1.150-2 of the Treasury Regulations. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS: Section 1. In accordance with Section 1.150-2 of the Treasury Regulations, the City Council hereby declares its intention to issue Bonds, or cause Bonds to be issued, in a principal amount not expected to exceed $6,000,000.00, the proceeds of which will be used to pay for the costs of the Project (and related issuance costs), including the reimbursement to the City or the Agency for capital expenditures relating to the Project made prior to the issuance of the Bonds. Section 2. This Resolution shall take effect immediately upon its adoption. PASSED, APPROVED AND ADOPTED this 9th day of June 2005, by the following vote to wit: AYES: NOES: ABSENT: ABSTAIN: ATTEST: Rachelle D. Klassen, City Clerk City of Palm Desert, California 2 Buford A. Crites, Mayor P6401 / 1033/821442.1 RESOLUTION NO. _502 A RESOLUTION OF THE PALM DESERT REDEVELOPMENT AGENCY DECLARING ITS INTENT TO ISSUE BONDS OR OTHER OBLIGATIONS OR CAUSE BONDS OR OTHER OBLIGATIONS TO BE ISSUED TO FINANCE THE INSTALLATION AND CONSTRUCTION OF THE PORTOLA AVENUE BRIDGE AND TO REIMBURSE CERTAIN EXPENDITURES FROM PROCEEDS OF THE BONDS RECITALS: A. The Palm Desert Redevelopment Agency (the "Agency") intends to issue bonds or other obligations (the "Bonds"), or cause Bonds to be issued, to finance the costs of the installation and construction of the Portola Avenue Bridge and appurtenant work (the "Project"). B. The Agency or the City expects to expend moneys (other than moneys derived from the issuance of bonds or other obligations) on expenditures relating to the costs of the Project prior to the issuance of the Bonds. All expenditures will be properly chargeable to a capital account under general federal income tax principles. The Agency reasonably expects to reimburse such capital expenditures with the proceeds of the Bonds. C. The Agency expects that the maximum principal amount of Bonds which will be issued to pay for the costs of the Project (and related issuance costs) will not exceed $6, 000, 000.00. D. At the time of the reimbursement, the Agency will evidence the reimbursement in a writing which identifies the allocation of the proceeds of the Bonds for the purpose of reimbursing the Agency for the capital expenditures made prior to the issuance of the Bonds. E. The Agency expects to make the reimbursement allocation no later than 18 months after the later of (i) the date on which the earliest original expenditure for the Project is paid or (ii) the date on which the Project is placed in service (or abandoned), but in no event later than three years after the date on which the earliest original expenditure for the Project is paid. F. The Agency will not, within one year of the reimbursement allocation, use the proceeds of the Bonds received in the reimbursement allocation in a manner that will result in the creation of replacement proceeds of the Bonds or another issue (e.g., the Agency will not pledge or use the proceeds received for the payment of debt service on the Bonds or another issue, except that the proceeds of the Bonds can be deposited in a bona fide debt service fund). P6401 / 1033/82141 1. I RESOLUTION NO. 502 G. This Resolution is intended to be a "declaration of official intent" in accordance with Section 1.150-2 of the Treasury Regulations. NOW, THEREFORE, THE PALM DESERT REDEVELOPMENT AGENCY HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS: Section 1. In accordance with Section 1.150-2 of the Treasury Regulations, the Agency hereby declares its intention to issue Bonds, or cause Bonds to be issued, in a principal amount not expected to exceed $6,000,000.00, the proceeds of which will be used to pay for the costs of the Project (and related issuance costs), including the reimbursement to the Agency or the City for capital expenditures relating to the Project made prior to the issuance of the Bonds. Section 2. This Resolution shall take effect immediately upon its adoption. PASSED, APPROVED AND ADOPTED this 9th day of June 2005, by the following vote to wit: AYES: NOES: ABSENT: ABSTAIN: ATTEST: Rachelle D. Klassen, Secretary 2 Buford A. Crites, Chairman P6401 / 1033/82141 1. I