Loading...
HomeMy WebLinkAbout2021-046 CFD 2021-1 (Canyon Hills) Issuance of Refunding Bonds RESOLUTION NO. 2021-46 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, AUTHORIZING THE ISSUANCE OF REFUNDING BONDS AND APPROVING AND AUTHORIZING RELATED DOCUMENTS AND ACTIONS Whereas, the City Council (the “City Council”) of the City of Lake Elsinore (the “City”) has previously formed its Assessment District No. 93-1 (Canyon Hills) (the “Assessment District”) and confirmed reassessments on the various parcels located therein to refinance the costs of certain improvements of special local benefit to said parcels (the “Prior Reassessments”), all pursuant to the Refunding Act of 1984 for 1915 Improvement Act Bonds (Division 11.5, commencing with Section 9500, of the Streets and Highways Code of California) (the “Act”); and, Whereas, the City Council has previously caused bonds to be issued on behalf of the Assessment District (the “Prior Bonds”) pursuant to the provisions of the Act in order, among other things, to refinance the costs of the aforesaid improvements; and, Whereas, the Prior Bonds are secured by the unpaid Prior Reassessments; and, Whereas, the Prior Bonds were purchased by the Lake Elsinore Public Financing Authority (the “Authority”) in connection with the issuance of the Authority’s Local Agency Revenue Refunding Bonds (Assessment District No. 93-1), 2012 Series B (the “Prior Authority Bonds”); and, Whereas, the City Council has previously adopted its “Resolution of the City Council of the City of Lake Elsinore Declaring its Intention to Levy Reassessments and to Issue Refunding Bonds” (the “Resolution of Intention”) in and for the “City of Lake Elsinore Reassessment District No. 2021-1 (Canyon Hills)” (the “Reassessment District”) in which it determined that, in order to benefit taxpayers within the Assessment District, which are encompassed by the Reassessment District, by reducing the amount of the installments of the Prior Reassessments being levied each year on the parcels within the Assessment District, the public interest and necessity required that the outstanding Prior Bonds be refunded, and in which the City Council declared its intention to accomplish the refunding through the levy of reassessments and the issuance of refunding bonds upon the security thereof, all pursuant to the Act; and, Whereas, among other things, in the Resolution of Intention, the City Council directed the making and filing of a reassessment report (the “Report”) in writing, all in accordance with and pursuant to the Act; and, Whereas, the Report was duly made and filed with the City Clerk and was duly considered by the City Council and found to be sufficient in every particular; and, Whereas, subsequent to its receipt and review of the Report, the City Council adopted its “Resolution of the City Council of the City of Lake Elsinore Adopting the Reassessment Report, Confirming and Ordering the Reassessment by Summary Proceedings, and Authorizing and Directing Related Actions” (the “Resolution Confirming the Reassessment”) in which, among other things, it found that all of the conditions set forth in Section 9525 of the Act had been satisfied, approved the Report and confirmed the reassessment; and, DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-46 Page 2 of 6 Whereas, the proceedings for the reassessment under the Act and the Resolution of Intention are now completed, and the City Council wishes to provide for the issuance of refunding bonds hereinafter described (the “Refunding Bonds”) on the security of such unpaid reassessments pursuant to the Act; and, Whereas, the Refunding Bonds shall be issued under and in accordance with the Indenture, dated as of May 1, 2021 (the “Indenture”), by and between the City and Wilmington Trust, National Association, as trustee (the “Trustee”) in an aggregate principal amount not to exceed the aggregate amount of the unpaid reassessment; and, Whereas, in order to effect the issuance of the Refunding Bonds, the City Council desires to approve the form of a Preliminary Official Statement for the Refunding Bonds (the “Preliminary Official Statement”) and to approve the forms of and to authorize the execution and delivery of the Indenture, a Bond Purchase Agreement, a Continuing Disclosure Certificate and an Escrow Agreement, in substantially the forms on file with the City Clerk and to authorize such changes and additions thereto as the Authorized Officers (defined herein) deem necessary or desirable; and, Whereas, the City Council has determined that a negotiated sale of the Refunding Bonds to Stifel Nicolaus & Company, Incorporated, as Underwriter (the “Underwriter”), in accordance with the terms of the Bond Purchase Agreement to be entered into by the City and the Underwriter (the “Bond Purchase Agreement”) will result in a lower overall cost to the City than a sale of the Refunding Bonds on sealed proposals to the highest bidder in that a negotiated sale will allow for adequate time to pre-market the Refunding Bonds and for the timing of the sale of the Refunding Bonds to be flexible, thereby maximizing the likely debt service savings to the City; and, Whereas, the City Council has determined that it is prudent in the management of its fiscal affairs to issue the Refunding Bonds and that the issuance of the Refunding Bonds will achieve debt service savings and will benefit taxpayers within the Assessment District; and Whereas, the refunding and defeasance of the Prior Bonds will cause a simultaneous refunding and defeasance of the Prior Authority Bonds; and, Whereas, all conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of the Refunding Bonds and the levy of the reassessments as contemplated by this Resolution and the documents referred to herein exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Act. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOW: Section 1. The above recitals, and each of them, are true and correct. Section 2. The City Council finds that the issuance of the Refunding Bonds as described in the Preliminary Official Statement will provide significant public benefits by reducing the total amount of installments of reassessments to be levied for debt service within the Assessment District. Section 3 The City Council has determined to defease the Prior Bonds, subject to the provisions of Section 5 below regarding debt service savings, through (a) the issuance of its Refunding Bonds pursuant to the Indenture and a Bond Purchase Agreement and (b) the DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-46 Page 3 of 6 application of certain existing funds is being held in connection with the Prior Bonds to such defeasance. Section 4. The City is authorized pursuant to the Act to issue the Refunding Bonds for the purpose of refunding the Prior Bonds. Section 5. The issuance of the Refunding Bonds in a principal amount not to exceed $10,555,000 is hereby authorized, with the exact principal amount to be determined by the official signing the Bond Purchase Agreement in accordance with Section 10 below. The Refunding Bonds may be issued to refund the Prior Bonds only if the Mayor, the City Manager, or their written designees (each, an “Authorized Officer” and collectively, the “Authorized Officers”), determine that there is an economic benefit to the City in the form of aggregate net present value savings of at least 2.00%, expressed as a percentage of the par amount of the Prior Bonds to be refunded by the Refunding Bonds. Each of the foregoing determinations to be made by an Authorized Officer will be conclusively evidenced by the execution of the Bond Purchase Agreement by the City. Section 6. The Refunding Bonds shall mature on the dates and pay interest at the rates set forth in the Bond Purchase Agreement. The Refunding Bonds shall be governed by the terms and conditions of the Indenture. Section 7. The form of the Indenture presented at this meeting is hereby approved. The Indenture shall be executed by any of the Authorized Officers, substantially in the form of the Indenture presented at this meeting, with such additions thereto and changes therein as the Authorized Officer executing the same deem necessary or desirable, including to insert the offering price(s), interest rate(s), principal amount per maturity, redemption dates and prices, reserve account deposits and such other related terms and provisions or to conform any provisions therein to the Bond Purchase Agreement and the Official Statement delivered to the purchasers of the Refunding Bonds. Approval of such changes shall be conclusively evidenced by the execution and delivery of the Indenture by any one of the Authorized Officers. Capitalized terms used in this Resolution which are not defined herein have the meanings ascribed to them in the Indenture. Section 8. The Refunding Bonds shall be executed by the manual or facsimile signature of the City Treasurer, and the signature of the City Treasurer shall be attested to with the manual or facsimile signature of the City Clerk or a Deputy City Clerk. Section 9. The covenants set forth in the Indenture to be executed in accordance with Section 7 above are hereby approved, shall be deemed to be covenants of the City Council and shall be complied with by the City and its officers. Section 10. The Underwriter is hereby appointed for purposes of offering the Refunding Bonds for sale in accordance with the provisions of the Bond Purchase Agreement and the Indenture. The form of the Bond Purchase Agreement presented at this meeting is hereby approved; and any one of the Authorized Officers is hereby authorized to execute the Bond Purchase Agreement substantially in the form presented at this meeting, with such additions thereto and changes therein as the Authorized Officer executing the same deem necessary or desirable, including to conform the Bond Purchase Agreement to the dates, amounts and interest rates applicable to the Refunding Bonds. Approval of such additions and changes shall be conclusively evidenced by the execution and delivery of the Bond Purchase Agreement; provided, however, that the Bond Purchase Agreement shall be signed only if the requirements of Section DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-46 Page 4 of 6 5 hereof have been satisfied and that the Underwriter’s discount in connection with the Refunding Bonds shall not exceed 1.50% of the principal amount of the Refunding Bonds. Section 11. The form of the Continuing Disclosure Certificate attached to the Preliminary Official Statement and presented at this meeting is hereby approved; and any one of the Authorized Officers is hereby authorized and directed to execute the Continuing Disclosure Certificate substantially in the form hereby approved, with such additions therein and changes thereto as the Authorized Officer executing the same deem necessary or desirable, with such approval to be conclusively evidenced by the execution and delivery of the Continuing Disclosure Certificate. Section 12. The form of the Escrow Agreement (the “Escrow Agreement”), by and among the City, the Authority and Wilmington Trust, National Association, as escrow agent, presented at this meeting, is hereby approved, and any one of the Authorized Officers is hereby authorized and directed to execute the Escrow Agreement substantially in the form hereby approved, with such additions therein and changes thereto as the Authorized Officer executing the same deem necessary or desirable, with such approval to be conclusively evidenced by the execution and delivery of the Escrow Agreement. Section 13. The form of the Preliminary Official Statement presented at this meeting is hereby approved and the Underwriter is hereby authorized to distribute the Preliminary Official Statement to prospective purchasers of the Refunding Bonds in the form hereby approved, together with such additions thereto and changes therein as are determined necessary by the Authorized Officers to make such Preliminary Official Statement final as of its date for purposes of Rule 15c2-12 of the Securities and Exchange Commission. Each of the Authorized Officers is hereby authorized to execute a final Official Statement in the form of the Preliminary Official Statement, together with such changes as are determined necessary by the Authorized Officers, to make such Official Statement complete and accurate as of its date. The Underwriter is further authorized to distribute the final Official Statement for the Refunding Bonds and any supplement thereto to the purchasers of the Refunding Bonds upon the execution of the final Official Statement as described above. Section 14. Each of the Authorized Officers is authorized to provide for all services necessary to affect the issuance, sale and delivery of the Refunding Bonds. Such services shall include, but not be limited to, obtaining legal services, trustee services, verification agent services, consultant services and any other services deemed appropriate by an Authorized Officer. Each Authorized Officer is authorized to pay for the cost of such services, together with other costs of issuance, from Refunding Bond proceeds deposited pursuant to the Indenture. Section 15. Each of the Authorized Officers is authorized, but not required, to obtain a rating of the Refunding Bonds from a nationally recognized rating service. Each of the Authorized Officers, or their respective written designees, acting alone, is hereby authorized to negotiate the terms of a commitment (the “Insurance Commitment”) for bond insurance for some or all of the Refunding Bonds and a commitment for a reserve fund surety bond (the “Surety Commitment”) for all or a portion of the Reserve Fund (as defined in the Indenture) from one or more municipal bond insurance companies (an “Insurer”) and, if such officer determines that the acquisition either of a policy or a reserve fund surety bond, or both, from an Insurer will result in net interest rate savings or will result in more annual debt service savings, to pay the premiums for such policy and surety bond from the proceeds of the Refunding Bonds and to revise the documents approved by this Resolution to the extent necessary to conform to the terms of the Insurance Commitment DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-46 Page 5 of 6 and the Surety Commitment. Each of the Authorized Officers, acting alone, is further authorized to execute a reimbursement agreement required by the Surety Commitment. Section 16. All actions heretofore taken by any Authorized Officers, or by any other officers, employees or agents of the City, with respect to: (1) the issuance, delivery or sale of the Refunding Bonds; (2) the refunding, defeasance and redemption of the Prior Bonds and the Prior Authority Bonds; and (3) the Indenture, the Bond Purchase Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, or any of the documents referenced therein, are hereby approved, confirmed and ratified. The Mayor or his designee and the other Authorized Officers responsible for the fiscal affairs of the City are hereby jointly and severally authorized and directed to do all things and take any and all actions and execute and deliver any and all documents as are necessary or desirable to accomplish the issuance, sale and delivery of the Refunding Bonds and the refunding and redemption of the Prior Bonds and the Prior Authority Bonds in accordance with the provisions of this Resolution, and as are necessary or appropriate for the fulfillment of the purposes of the Refunding Bonds as described in the Indenture, including executing and delivering any amendments to the documents for the Prior Bonds and the Prior Authority Bonds. Any document authorized herein to be signed by the City Clerk may be signed by a duly appointed Deputy City Clerk. Section 17. The City Council acknowledges that the good faith estimates required by Section 5852.1 of the California Government Code are disclosed in the staff report and are available to the public at the meeting at which this Resolution is approved. Section 18. This Resolution shall be effective upon its adoption. Passed and Adopted at a regular meeting of the City Council of the City of Lake Elsinore, California, this 13th day of April 2021. Robert E. Magee Mayor Attest: Candice Alvarez, MMC City Clerk DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-46 Page 6 of 6 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF LAKE ELSINORE ) I, Candice Alvarez, MMC, City Clerk of the City of Lake Elsinore, California, do hereby certify that Resolution No. 2021-46 was adopted by the City Council of the City of Lake Elsinore, California, at the Regular meeting of April 13, 2021 and that the same was adopted by the following vote: AYES: Council Members Tisdale, Johnson, and Manos; Mayor Pro Tem Sheridan; and Mayor Magee NOES: None ABSENT: None ABSTAIN: None Candice Alvarez, MMC City Clerk DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0