HomeMy WebLinkAboutCC 17 ASSESS DIST REFD 11-07-96AGENDA
NO. 17
11-7-94
)ATE:
OCTOBER 31, 1994
Inter-Corn
TO:
FROM:
SUBJECT:
WILLIAM AJ~TON, CITY MANAGER
RONALD A-~DIRECTOR OF FINANCE
STATUS REPORT - ASSESSMENT DISTRICT REFUNDINGS
RECOMMENDATION:
Confirm the selection of Jones, Hall, Hill and White as Bond
Counsel and the selection of Paine Webber Incorporated as
Underwriter and, direct staff to proceed with the formation of a
Financing Authority made up of the City and the Redevelopment
Agency as recommended by the City's Financial Advisor and
Underwriter.
FISCAL IMPACT:
Based on analysis and recommendation of both our Financial Advisor
and Underwriter the formation of the Financing Authority maximizes
current savings and provides a basis for future conversions to fall
under the Authority's interest rate umbrella.
DISCUSSION:
We received four proposals from Bond Counsel and conducted phone
interviews with three. Based on ~ual~f~a~nn~ ~e ~v~ '
--~ · - .... , ~- -L ........ ' ~ ..... ~erlence,
op±nlons Dase~ on ~ne City s needs, desires and fees, Jones, Hall,
Hill and White was selected as Bond Counsel for the refundings.
We received six Underwriter proposals. Along with a representative
of the Irvine Company we interviewed three firms, Paine Webber,
Merrill Lynch and Stone and Youngberg/J.p. Morgan. Based on the
quality and insightfulness of their presentation and their proposed
interest rates and fees, we unanimously chose Paine Webber to act
as Underwriter on this issue.
I've attached several pages from Paine Webber's presentation
material to better illustrate their thinking on how to structure
this refunding to maximize savings to both the fixed and variable
lien payers.
Attachment one illustrates the basic structure. We will maintain
two Assessment Districts which will sell one variable and one fixed
rate isssue. The JPA will sell Revenue Bonds and use the proceeds
Page 2
October 31, 1994
Status Report - Assessment District Refundings
to buy the new Assessment District issues. Attachment two
highlights the benefits of such a structure and attachment three
demonstrates how future conversions can, under certain conditions,
be issued as Parity Bonds with bond inurance similar to the
original Financing Authority Bonds. Paine Webber's very optomistic
that the fixed rate issues can qualify for bond insurance and they
are working on insuring the variable rate issues. The AkA rating
that comes with insurance may save an additional $250,000 net of
the premium cost.
The financing team is currently working on drafting documents for
city Council review and feel that they can make a full presentation
at the December 5, city Council meeting. I've attached a draft
financing schedule which is very agressive but attainable. We are
currently requesting proposals for Trustee services.
RAN:ls
Attachments
a: adstatus.wah
Attachnent 1
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Attachment 2
Attachment 3
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Attachment 4
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