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HomeMy WebLinkAboutSA Reso 2018-010 Issuance & Sale of Tax Allocation Refunding Bonds, First Supplemental Indenture of Trust, Escrow Agreement Formation, Bond Purchase Agreement, & Continuation Disclosure CertificateRESOLUTION NO. 2018-010 A RESOLUTION OF THE SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY OF THE CITY OF LAKE ELSINORE, CALIFORNIA, AUTHORIZING THE ISSUANCE AND SALE OF TAX ALLOCATION REFUNDING BONDS TO REFUND CERTAIN OBLIGATIONS OF THE REDEVELOPMENT AGENCY OF THE CITY OF LAKE ELSINORE AND APPROVING THE FORM OF A FIRST SUPPLEMENTAL INDENTURE OF TRUST, A FORM ESCROW AGREEMENT, A FORM BOND PURCHASE AGREEMENT AND A FORM CONTINUING DISCLOSURE CERTIFICATE AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH Whereas, the Redevelopment Agency of the City of Lake Elsinore (Former Agency) was a public body, corporate and politic, duly created, established and authorized to transact business and exercise its powers under and pursuant to the provisions of the Community Redevelopment Law (Part 1 of Division 24 of the Health and Safety Code of the State of California) (the "Law"), and the powers of the Former Agency included the power to issue bonds and incur loans for any of its corporate purposes; and, Whereas, a Redevelopment Plan for the Rancho Laguna Redevelopment Project Area No. I (Project Area 1) of the Former Agency was adopted on September 30, 1980, pursuant to Ordinance No. 607, as subsequently amended in compliance with all requirements of the Law, and all requirements of law for and precedent to the adoption and approval of the Redevelopment Plan for Project Area I, as amended, have been duly complied with; and, Whereas, a Redevelopment Plan for the Rancho Laguna Redevelopment Project Area No. II (Project Area II) of the Former Agency was adopted on July 11, 1983, pursuant to Ordinance No. 671, as subsequently amended in compliance with all requirements of the Law, and all requirements of law for and precedent to the adoption and approval of the Redevelopment Plan for Project Area II, as amended, have been duly complied with; and, Whereas, a Redevelopment Plan for the Rancho Laguna Redevelopment Project Area No. III (Project Area III) of the Former Agency was adopted on September 8, 1987, pursuant to Ordinance No. 815, as subsequently amended in compliance with all requirements of the Law, and all requirements of law for and precedent to the adoption and approval of the Redevelopment Plan for Project Area III, as amended, have been duly complied with; and, Whereas, the Former Agency has previously incurred the obligations listed on Exhibit A hereto (collectively, the "Refunded Obligations"); and, Whereas, on June 28, 2011, the California Legislature adopted ABx1 26 (Dissolution Act) and ABx1 27 (Opt -in Bill); and, Whereas, the California Supreme Court subsequently upheld the provisions of the Dissolution Act and invalidated the Opt -in Bill resulting in the dissolution of the Former Agency as of February 1, 2012; and, Whereas, the Former Agency, including its redevelopment powers, assets and obligations, was transferred on February 1, 2012 to the Successor'Agency of the Redevelopment Agency of the City of Lake Elsinore (Successor Agency); and, A-1 SA Reso. No. 2018-010 Page 2 of 6 Whereas, on or about June 27, 2012, AB1484 was adopted as a trailer bill in connection with the 2012-13 California Budget; and, Whereas, California Health and Safety Code Section 34177.5(a)(1) authorizes Successor Agencies to refund outstanding bonds or other indebtedness provided that: (i) the total interest cost to maturity on the refunding bonds or other indebtedness, plus the principal amount of the refunding bonds or other indebtedness, does not exceed the total remaining interest cost to maturity on the bonds or other indebtedness to be refunded, plus the remaining principal of the bonds or other indebtedness to be refunded; and (ii) the principal amount of the refunding bonds or other indebtedness does not exceed the amount required to defease the bonds or other indebtedness to be refunded, to establish customary debt service reserves and to pay related costs of issuance; and, Whereas, the Successor Agency has previously refinanced certain bonded indebtedness obligations of the Former Agency pursuant to its Resolution No. SA -2015-002 and that certain Indenture of Trust dated as of September 1, 2015 (2015 Indenture), by and between the Successor Agency and Wilmington Trust, National Association, providing for the issuance of the Successor Agency's Successor Agency of the Redevelopment Agency of the City of Lake Elsinore Subordinated Tax Allocation Refunding Bonds, Series 2015 in the aggregate principal amount of $8,065,000; and, Whereas, the Successor Agency desires to authorize and approve the issuance of tax allocation refunding bonds (2018C Bonds) in an aggregate principal amount sufficient to refund all or a portion of the Refunded Obligations, and to irrevocably set aside a portion of the proceeds of such 2018C Bonds in a separate segregated trust fund which will be used to refund the outstanding Refunded Obligations being refunded, to pay costs in connection with the issuance of the 2018C Bonds and to make certain other deposits as required by the Indenture (as defined below); and, Whereas, the 2018C Bonds shall be secured by a pledge of property tax revenues authorized by California Health and Safety Code Section 34177.5(a) and (g), pursuant to the provisions of Article 11 of Chapter 3 of Part 1 of Division 2 of Title 5 of the California Government Code (Bond Law); and, Whereas, the 2018C Bonds shall be issued as Parity Debt under the 2015 Indenture pursuant to a First Supplemental Indenture of Trust described in this Resolution; and, Whereas, Senate Bill 450 (Chapter 625 of the 2017-2018 Session of the California Legislature) (SB 450) requires that the Successor Agency obtain from an underwriter, municipal advisor or private lender and disclose, in a meeting open to the public, prior to authorization of the issuance of the 2018 Bonds, good faith estimates of (a) the true interest cost of the 2018 Bonds, (b) the sum of all fees and charges paid to third parties with respect to the 2018 Bonds, (c) the amount of proceeds of the 2018 Bonds expected to be received net of the fees and charges paid to third parties and any reserves or capitalized interest paid or funded with proceeds of the 2018 Bonds, and (d) the sum total of all debt service payments on the 2018 Bonds calculated to the final maturity of the 2018 Bonds plus the fees and charges paid to third parties not paid with the proceeds of the 2018 Bonds; and, Whereas, in compliance with SB 450, the Successor Agency has obtained from the Municipal Advisor the required good faith estimates and such estimates are disclosed and set forth in [the staff report submitted to the Successor Agency Board herewith]; and, A-2 SA Reso. No. 2018-010 Page 3 of 6 Whereas, the Successor Agency wishes at this time to approve matters relating to the issuance and sale of the 2018C Bonds. NOW THEREFORE, THE SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY OF THE CITY OF LAKE ELSINORE, DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. Subject to the provisions of the Indenture referred to in Section 2 hereof, the issuance of the 2018C Bonds, in one or more series, and from time to time, in an aggregate principal amount of not to exceed $12,500,000, or such lesser amount as is sufficient to refund all or a portion of the Refunded Obligations listed on Exhibit A for the purpose of achieving debt service savings in accordance with Health & Safety Code Section 34177.5(a)(1) and the pledge of property tax revenues to the 2018C Bonds pursuant to the Indenture approved by Section 2 of this Resolution (as authorized by California Health and Safety Code Section 34177.5(a) and (g)) is hereby approved on the terms and conditions set forth in, and subject to the limitations specified in, the Indenture. The 2018C Bonds will be dated, will bear interest at the rates, will mature on the dates, will be issued in the form, will be subject to redemption, and will be as otherwise provided in the Indenture, as the same will be completed as provided in this Resolution. The proceeds of the sale of the 2018C Bonds shall be applied as provided in the Indenture. The 2018C Bonds may be issued as a single issue, or from time to time, in separate taxable or tax- exempt series, as the Successor Agency shall determine. The approval of the issuance of the 2018C Bonds by the Successor Agency and the Oversight Board shall constitute the approval of each and every separate series of 2018C Bonds and the sale of the 2018C Bonds at a public or private sale, without the need for any further approval from the Oversight Board. Section 2. The form of the First Supplemental Indenture of Trust (Supplemental Indenture) presented herewith, providing for the issuance of the 2018C Bonds, is hereby approved. The Supplemental Indenture and the 2015 Indenture are sometimes collectively referred to herein as the "Indenture." The Chair, the Executive Director, the Assistant Executive Director, and the Secretary of the Successor Agency, any other member of the governing board of the Successor Agency, or their respective written designee (each an "Authorized Officer" and collectively, the "Authorized Officers") are, and each of them is, hereby authorized and directed, for and in the name of the Successor Agency, to execute and deliver the Indenture, in substantially said form, with such 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. If the 2018C Bonds are to be sold in separate taxable or tax-exempt series at different times, each of the Authorized Officers is hereby authorized and directed in the name of the Successor Agency to execute any supplement to the Indenture to provide for the issuance of such series of Bonds consistent with the terms of this Resolution. Each of the Authorized Officers is hereby authorized and directed to execute and countersign each of the 2018C Bond forms on behalf of the Successor Agency, either manually or by facsimile, and such signing as herein provided shall be a sufficient and binding execution of the 2018C Bonds on behalf of the Successor Agency. In case any of such officers whose signature appears on the 2018C Bond forms shall cease to be such officer before the delivery of the 2018C Bonds, such signature shall nevertheless be valid and sufficient for all purposes as though such officer had remained in office until the delivery of the 2018C Bonds. Section 3. The 2018C Bonds shall be sold by negotiated sale pursuant to the Bond Purchase Agreement in substantially the form presented herewith, between the Successor Agency and A-3 SA Reso. No. 2018-010 Page 4 of 6 Stifel, Nicolaus & Company, Incorporated (Underwriter). The Bond Purchase Agreement is hereby approved. The Authorized Officers are, and each of them is, hereby authorized and directed, for and in the name of the Successor Agency, to execute and deliver the Bond Purchase Agreement in substantially said form, with such changes and additions therein as the Authorized Officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof; provided, however, that the Bond Purchase Agreement shall be signed only if the terms of the agreement comply with the requirements and parameters set forth in this Resolution, in particular Sections 1 and 6 hereof. In the event the Successor Agency elects to sell the 2018C Bonds in more than one series and at more than one time, the Bond Purchase Agreement is hereby approved for such subsequent sale(s) with such changes as may be deemed necessary or appropriate by the Authorized Officers executing the same so long as the terms of the Bond Purchase Agreement comply with this Resolution, in particular Sections 1 and 6 hereof. Section 4. The form of the Escrow Agreement presented herewith is hereby approved. The Authorized Officers are, and each of them is, hereby authorized and directed, for and in the name of the Successor Agency, to execute and deliver one or more Escrow Agreements for each of the Refunded Obligations in substantially said form, with such changes therein as the Authorized Officer executing the same may require or approve, including without limitation the addition or removal of parties to such agreements, such approval to be conclusively evidenced by the execution and delivery thereof. Section 5. The form of the Continuing Disclosure Certificate presented herewith is hereby approved. The Authorized Officers are, and each of them is, hereby authorized and directed, for and in the name of the Successor Agency, to execute and deliver the Continuing Disclosure Certificate in substantially said form, with such 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 6. Each of the Authorized Officers and other appropriate officers of the Successor Agency, acting alone, is authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents and contracts that they may deem necessary or advisable in order to consummate the sale, execution and delivery of the 2018C Bonds and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution, the 2018C Bonds, the Indenture, the Continuing Disclosure Certificate, the Bond Purchase Agreement and the Escrow Agreements, each in order to facilitate the issuance of the 2018C Bonds and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution, including, without limitation, to amend any of the legal documents entered into in connection with the Refunded Obligations in order to effectuate the defeasance and refunding of such Refunded Obligations, to amend any of the legal documents entered into in connection with the 2015 Bonds to effectuate the issuance of the 2018C Bonds as provided herein, to execute irrevocable refunding instructions with respect to the Refunded Obligations, to secure municipal bond insurance on the 2018C Bonds and/or a reserve surety to fund any reserve account or fund established for the 2018C Bonds, if available (which may include entering into a mutual insurance agreement(s) therefor), to enter into an agreement to sell the 2018C Bonds (provided that the underwriter's discount for the sale of the 2018C Bonds shall not exceed 0.8% of the aggregate principal amount of the 2018C Bonds), to request subordination of any. amounts required to be paid to an affected taxing entity to any or all of the 2018C Bonds, as the Authorized Officer may require or approve, in consultation with Bond Counsel and the Successor Agency's Municipal A-4 SA Reso. No. 2018-010 Page 5 of 6 Advisor, and any such actions heretofore taken by such officers in connection therewith are hereby ratified, confirmed and approved. Section 7. Stradling Yocca Carlson & Rauth, a Professional Corporation, is hereby approved and appointed as Bond Counsel and Disclosure Counsel, Urban Futures, Inc., is hereby approved and appointed as Municipal Advisor, HdL Coren & Cone as Fiscal Consultant, Wilmington Trust, National Association is hereby appointed as Trustee and Escrow Bank, and Stifel, Nicolaus & Company, Incorporated is hereby appointed as Underwriter, each to provide such services to the Successor Agency and any other related services as may be required to issue the 2018C Bonds and to defease and/or refund the Refunded Obligations. Section 8. If any provision of this Resolution or the application of any such provision to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Resolution that can be given effect without the invalid provision or application, and to this end the provisions of this Resolution are severable. The Successor Agency declares that the Successor Agency would have adopted this Resolution irrespective of the invalidity of any particular portion of this Resolution. Section 9. This Resolution shall take effect immediately upon its adoption by the governing board of the Successor Agency, and the Secretary shall certify the vote adopting this resolution. Passed and Adopted this 26th day of June Nat 'ha Johnso Chair Attest: Susan M. Domen, MMC Clerk STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF LAKE ELSINORE ) I, Susan M. Domen, MMC, Secretary of the Successor Agency of the Redevelopment Agency of the City of Lake Elsinore, California, hereby certify that Successor Agency No. 2018-010 was adopted by the Successor Agency of the City of Lake Elsinore, California, at the Joint meeting held on the 26th day of June 2018, and that the same was adopted by the following vote: AYES: Members Magee and Tisdale; NOES: None ABSENT: Member Hickman ABSTAIN: None Vice -Chair Manos and Chair Johnson A-5 Susan M. Domen, MMC City Clerk SA Reso. No. 2018-010 Page 6of6 EXHIBIT A REFUNDED OBLIGATIONS That certain Project Area No. I Loan Agreement by and between the Former Agency and the Lake Elsinore Public Financing Authority (the "Authority"), dated as of February 1, 2010, pursuant to which the Authority made a loan to the Former Agency in the original principal amount of $3,055,000, secured by tax increment revenues from Project Area I (the "2010A PAI Loan"). 2. That certain Project Area No. II Loan Agreement by and between the Former Agency and the Authority, dated as of February 1, 2010, pursuant to which the Authority made a loan to the Former Agency in the original principal amount of $5,505,000, secured by tax increment revenues from Project Area II (the "2010A PAII Loan"). 3. That certain Project Area No. III Loan Agreement by and between the Former Agency and the Authority, dated as of February 1, 2010, pursuant to which the Authority made a loan to the Former Agency in the original principal amount of $2,075,000, secured by tax increment revenues from Project Area IIII (the "2010A PAII Loan"). 4. That certain Housing Fund Loan Agreement by and between the Former Agency and the Authority, dated as of February 1, 2010, pursuant to which the Authority made a loan to the Former Agency in the original principal amount of $4,800,000, secured by tax increment revenues required to be deposited into the Former Agency's Low and Moderate Income Housing Fund (the "2010A Housing Loan"; and together with the 2010A PAI Loan, the 2010A PAII Loan, and the 2010A PAI II Loan, the "2010A Loans"). Payments with respect to the 2010A Loans secure payment of the Authority's $15,435,000 Lake Elsinore Public Financing Authority Tax Allocation Revenue Bonds (1999 Series C Refunding), 2010 Series A. FEW