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HomeMy WebLinkAbout2021-035 Bond Issuance CFD 2003-2 (IAC) (Canyon Hills)RESOLUTION NO. 2021-35 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, ACTING AS THE LEGISLATIVE BODY OF CITY OF LAKE ELSINORE COMMUNITY FACILITIES DISTRICT NO. 2003-2 (CANYON HILLS), AUTHORIZING THE ISSUANCE OF ITS IMPROVEMENT AREA C 2021 SPECIAL TAX REFUNDING BONDS IN A PRINCIPAL AMOUNT NOT TO EXCEED SIX MILLION FIVE HUNDRED THOUSAND DOLLARS ($6,500,000), AND APPROVING CERTAIN DOCUMENTS AND TAKING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH Whereas, the City Council of the City of Lake Elsinore (the “City”), located in Riverside County, California (hereinafter sometimes referred to as the “legislative body of the District”), has heretofore undertaken proceedings to form City of Lake Elsinore Community Facilities District No. 2003-2 (Canyon Hills) (the “District”) and designated Improvement Area C therein (“Improvement Area C”), pursuant to the terms and provisions of the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the “Act”); and, Whereas, the District is authorized to finance certain public facilities and other governmental facilities that are necessary to meet increased demands placed upon the City as a result of development or rehabilitation occurring within the District, which facilities may be physically located outside the boundaries of the District (the “Facilities”); and, Whereas, the District has previously issued its $5,345,000 Special Tax Bonds, 2012 Series (Improvement Area C) (the “Prior Bonds”) to finance certain Facilities in connection with the issuance by the Lake Elsinore Public Facilities Financing Authority (the “Lake Elsinore PFA”) of its Local Agency Revenue Bonds (Canyon Hills IA C), 2012 Series C (the “Prior Lake Elsinore PFA Bonds”); and, Whereas, the legislative body of the District now desires to refund the Prior Bonds and effect a simultaneous refunding of the Prior Lake Elsinore PFA Bonds through the issuance of bonds in an aggregate principal amount not to exceed $6,500,000 designated as the “City of Lake Elsinore Community Facilities District No. 2003-2 (Canyon Hills) Improvement Area C 2021 Special Tax Refunding Bonds” (the “2021 Bonds”); and, Whereas, in order to affect the issuance of the 2021 Bonds, the legislative body of the District desires to enter into a Bond Indenture, dated as of May 1, 2021 (the “Local Obligation Bond Indenture”), with Wilmington Trust, National Association, as Trustee, in substantially the form presented herewith; and, Whereas, in order to affect the refunding and redemption of the Prior Bonds and the Prior Lake Elsinore PFA Bonds, the legislative body of the District desires to enter into an Escrow Agreement, dated as of May 1, 2021 (the “Escrow Agreement”), with the Lake Elsinore PFA and Wilmington Trust, National Association, as Escrow Bank, in substantially the form presented herewith; and, Whereas, the legislative body of the District has determined in accordance with Section 53360.4 of the Code that a negotiated sale of the 2021 Bonds to the Lake Elsinore Facilities Financing Authority (the “Authority”) in accordance with the terms of the Local Obligations Purchase Agreement to be entered into by and among the Authority, the District and certain other community facilities districts of the City participating in the financing (the “Bond Purchase DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-35 Page 2 of 5 Agreement”) approved as to form by this legislative body herein will result in a lower overall cost to the District than a public sale; and, Whereas, the legislative body of the District has duly noticed and held a public hearing and hereby determines that it is prudent in the management of its fiscal affairs to issue the 2021 Bonds and that the issuance of the 2021 Bonds will result in significant public benefits of the type described in Government Code Section 6586; and, Whereas, the Authority will issue its bonds (the “Authority Bonds”) to provide funds for its purchase of the 2021 Bonds; NOW, THEREFORE, THE CITY COUNCIL, ACTING AS THE LEGISLATIVE BODY OF THE DISTRICT, DOES HEREBY RESOLVE, ORDER AND DETERMINE AS FOLLOWS: Section 1. Each of the above recitals is true and correct. Section 2. The legislative body of the District is authorized pursuant to the Act to issue the 2021 Bonds for the benefit of the District for purposes set forth herein and to take the necessary steps to refund and redeem the Prior Bonds. Section 3. The issuance of the 2021 Bonds in an aggregate principal amount not to exceed $6,500,000 is hereby authorized with the exact principal amount to be determined by the official signing the Bond Purchase Agreement in accordance with Section 6 below. The legislative body of the District hereby determines that it is prudent in the management of its fiscal affairs to issue the 2021 Bonds. The 2021 Bonds shall mature on the dates and pay interest at the rates set forth in the Bond Purchase Agreement to be executed on behalf of the District in accordance with Section 6 hereof. The 2021 Bonds shall be governed by the terms and conditions of the Local Obligation Bond Indenture presented at this meeting. The Local Obligation Bond Indenture shall be prepared by Bond Counsel to the District and executed by one or more of the Mayor, the City Manager, and their written designees (collectively, the “Authorized Officers”) substantially in the form presented at this meeting, with such additions thereto and changes therein as the officer or officers executing the same deem necessary to cure any ambiguity or defect therein, to insert the offering price(s), interest rate(s), selling compensation, principal amount per maturity, redemption dates and prices and such other related terms and provisions as limited by Section 6 hereof, to conform any provisions therein to the Bond Purchase Agreement and the Official Statement for the Authority Bonds. Approval of such changes shall be conclusively evidenced by the execution and delivery of the Local Obligation Bond Indenture by one or more Authorized Officers. Capitalized terms used in this Resolution which are not defined herein have the meanings ascribed to them in the Local Obligation Bond Indenture. In satisfaction of the requirements contained in Section 53363.2 of the Act, the legislative body of the District hereby determines that: (1) it is anticipated that the purchase of the 2021 Bonds will occur on or about April 29, 2021, (2) the 2021 Bonds shall bear the date, be in the denominations, have the maturity dates (which do not exceed the latest maturity date of the Prior Bonds), and be payable at the place and be in the form specified in the Local Obligation Bond Indenture, (3) the 2021 Bonds will bear interest at the minimum rate of 0.10% per annum, and (4) the designated cost of issuing the 2021 Bonds, as defined by Section 53363.8 of the Act, shall include all of the costs specified in Section 53363.8(a), (b)(2) and (c). In satisfaction of the requirements contained in Section 53364.2 of the Act, the legislative body of the District hereby determines that any savings achieved through the issuance of the 2021 Bonds shall be used to either finance additional Facilities and/or reduce special taxes of DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-35 Page 3 of 5 Improvement Area C of the District in accordance with the Act. The City Manager is hereby authorized to allocate the savings between the Facilities and reduction of special taxes as he may determine in accordance with the Act. Section 4. The 2021 Bonds shall be executed on behalf of the District by the manual or facsimile signature of the Mayor of the City, and attested with the manual or facsimile signature of the City Clerk. Wilmington Trust, National Association is hereby appointed to act as Trustee for the 2021 Bonds. Section 5. The covenants set forth in the Local Obligation Bond Indenture to be executed in accordance with Section 3 above are hereby approved, shall be deemed to be covenants of the City Council in its capacity as the legislative body of the District and shall be complied with by the District and its officers. Section 6. The form of the Bond Purchase Agreement presented herewith is hereby approved; and any one of the Authorized Officers is hereby authorized and directed, for and in the name of the District, to execute the Bond Purchase Agreement substantially in the form approved, with such additions thereto and changes therein as may be approved or required by an Authorized Officer, including changes relating to dates and numbers as are necessary to conform the Bond Purchase Agreement to the dates, amounts and interest rates applicable to the 2021 Bonds as of the sale date. 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: (i) the interest rate on the 2021 Bonds is such that the principal and total net interest cost to maturity on the 2021 Bonds is less than the principal and total net interest cost to maturity on the Prior Bonds; and (ii) the net present value of the debt service savings resulting from the issuance of the 2021 Bonds is equal to or greater than two percent (2.00%) of the principal amount of the Prior Bonds being refunded. Section 7. The form of the Preliminary Official Statement for the Authority Bonds presented at this meeting is hereby approved, and the underwriter of the Authority Bonds are hereby authorized to distribute the Preliminary Official Statement to prospective purchasers of the Authority Bonds in the form hereby approved, together with such additions thereto and changes therein as are determined necessary or desirable 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, including, but not limited to, such additions and changes as are necessary to make all information set forth therein accurate and not misleading. The underwriter of the Authority Bonds is further authorized to distribute the final Official Statement for the Authority Bonds and any supplement thereto to the purchasers thereof. Section 8. The form of the Escrow Agreement presented at this meeting is hereby approved; and any one of the Authorized Officers is hereby authorized and directed, for and in the name of the District, to execute and the City Clerk, or her written designee, is authorized to attest to the Escrow Agreement, with such additions thereto and changes therein as may be approved or required by an Authorized Officer, including changes to conform to the final pricing of the escrow investments and to clarify any ambiguities; provided that the form of Escrow Agreement may be modified to conform to federal tax law requirements or to achieve further savings, with the advice and assistance of Bond Counsel, such approval to be conclusively evidenced by the execution of the Escrow Agreement by an Authorized Officer. Wilmington Trust, National Association is hereby appointed to act as Escrow Agent under the Escrow Agreement. DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-35 Page 4 of 5 Section 9. In accordance with the requirements of Section 53345.8 of the Act, the legislative body of the District hereby determines that the assessed value of the real property in Improvement Area C of the District subject to the special tax to pay debt service on the 2021 Bonds is at least three times the principal amount of the 2021 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within Improvement Area C of the District. Section 10. Each of the Authorized Officers are authorized, but not required, to cooperate with the Authority so that the Authority may obtain a rating of the Authority Bonds from a nationally recognized rating service and to obtain a municipal bond insurance policy guaranteeing payment of principal and interest with respect to some or all of the Authority Bonds and/or a debt service reserve policy with respect to the Authority Bonds. The Authorized Officers are hereby further authorized to revise any of the documents referenced herein, or any related documents, to incorporate any provisions required in order to obtain such a municipal bond insurance policy and/or a debt service reserve policy. Section 11. The City Manager, the City Clerk or their written designee, are authorized to provide for all services necessary to affect the issuance of the 2021 Bonds. Such services shall include, but not be limited to, obtaining legal services, trustee services and any other services deemed appropriate as set forth in a certificate of the City Manager, the City Clerk or their written designee. The City Manager, the City Clerk or their written designee, or their written designee, are authorized to pay for the cost of such services, together with other costs of issuance from 2021 Bond proceeds, including premium costs for a municipal bond insurance policy and for a debt service reserve policy. Section 12. The City Manager, the City Clerk and all other officers of the City are hereby authorized and directed to take any actions and execute and deliver any and all documents as are necessary to accomplish the issuance, sale and delivery of the 2021 Bonds in accordance with the provisions of this Resolution, the fulfillment of the purposes of the 2021 Bonds as described in the Local Obligation Bond Indenture, including, but not limited to modifying the documents approved by this Resolution to reflect any provisions required by the bond insurer for the Authority Bonds, if any, certifying as to the accuracy of information in the Preliminary Official Statement and the final Official Statement relating to the District, and executing and delivering any amendments to the documents for the Prior Bonds. Any document authorized herein to be signed by the City Clerk may be signed by a duly appointed deputy clerk. Section 13. 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 14. This Resolution shall take effect immediately 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 DocuSign Envelope ID: A6529337-BAE4-405D-AEF4-5F77F9978BB0 CC Res. No. 2021-35 Page 5 of 5 Attest: Candice Alvarez, MMC City Clerk 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. 2021-35 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