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HomeMy WebLinkAbout22 AD 85-1 AD 86-2 11-20-95 11-20-95 · . DATE: NOVEMBER 20, 1995 TO' FROM: SUBJECT: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL WILLIAM A. HUSTON, CITY MANAGER REFINANCING OF TUSTINRANCH ASSESSMENT DISTRICT BONDS (AD 85-1 AND AD 86-2) .. The City Council previously authorized staff to proceed with refinancing of the outstanding assessment district bonds. Property owners will benefit by lower future annual assessments due to. lower interest rates on the bonds and using accrued construction cost savings to redeem outstanding bonds.' In authorizing the transaction to proceed, the City Council approved creation of the Tustin Public Financing Authority as the entity to effectuate the refinancing. The City Council approved creation of the Authority because from legal' and financial standpoints, it was the most cost-effective way to maximize the benefits of the refinancing. On November 20, 1995, the City Council will approve Various resolutions and documents which authorize sale of the bonds. The City Council will also convene as the Board of Directors of the Tustin Public Financing Authority to grant its authorizations. Because of the volume of the .various documents, they are being transmitted under separate cover. The City's financial consultants and special legal counsel will be at the meeting to explain the transaction. The consultants'and staff will be prepared to provide information on: 1. The typical savings to property owners within the assessment districts. 2. When property owners will realize the savings. In t e rj o rn D ATE' NOVEMBER 15, 1995 10: WILLI~H~USTON, CITY MANAGER FROM: RO~A~~..~, FINANcE DIRzcToR SUBJECT: ASSESSMENT DISTRICT 85-1 / 86-2 REFUNDING' RECOMMENDATION Adopt the following resolutions and supporting documents in substantially, complete form for Reassessment District No. 95-1, fixed rate bonds, and Reassessment District No. 95-2, various rate bonds: For Assessment District No. 95-1: · Resolution of Intention No. 95-115 Resolution confirming Reassessments No. 95-116 Resolution of Insurance No. 95-117: a. Fiscal Agent Agreement; b. Escrow Agreement; c. Bond PUrchase Agreement; d. Continuing Disclosure Agreement; and e. Preliminary Official Statement for Authority Bonds. For Assessment District No. 95-2; · Resolution of Intention No. 95-118 Resolution of Confirming Assessments No. 95-119 Resolution of Insurance No. 95-120: a . Fiscal Agent Agreement; Reimbursement Agreement; Escrow Agreement; Bond Purchase Agreement; Remarketing Agreement; Preliminary Official S~atement for 95-2 Bonds Protocol Agreement. Agenda Item to: William A. Huston, City Manager (cont'd.) .Discussion Late 1994 the City Council directed staff to analyze the existing assessment district bond issues for potential savings through refunding. The analysis determined that there wasa potential ' savings and the City Council direCted staff to proceed with the refunding and authorized RFP's for the selection of the various members of the refunding team. We have been proceeding with the refunding but have had to overcome several obstacles including the County Bankruptcy which threw the municipal bond market into complete chaos. We are at the end of the process and have scheduled the Bond Closing for Dec. 21, 1995. The postponement has been a blessing in disguise, interest rates have come down significantly since we first visited the to numbers. There will be several consultants available at The City Council Meeting to review the technical aspects of the refunding and answer any questions that may arise. Lora Stoval who is the City's Financial Advisor will make a presentation reviewing the process, why we are using a financing authority and cover the ultimate benefit that can be expected by the fixed rate property owners. Dan Gangwish will represent the City's underwriter, Paine Webber Inc., and Greg Harrington of .Jones Hall Hill & White, The City's Bond Counsel, will also be available to answer legal questions. a:agenda.2 RESOLUTION NO. 95-115 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN OF-INTENTION TO LEVY REASSESSMENTS AND TO ISSUE REFUNDING BONDS UPON THE SECURITY THEREOF Reassessment District No. 95-1 (Tustin Ranch) WHEREAS, the City Council (the "City.Council") of the City of TUstin (the "City"), by Resolution No. 86-81, adopted on June 16, 1986, resolved its intention to form City of Tustin Assessment District No. 85-1 ("District 85-1") and to issue bonds to represent unpaid assessments therein; WHEREAS, the City Council, by Resolution No. 86-81, adopted on June 16, 1986, confumed said assessments; WHEREAS, pursuant to Resolution No. 86-102 of the City Council, 'adopted on August 18, 1986, an Indenture of Trust, dated as of August 1, 1986 (the "85-1 Indenture"), by and between the City and Citibank, N. A., as trustee, and the Improvement Bond Act of 1915, being Division 10 of the Streets and Highways Code of California (the "Bond Law"), the City issued City of Tustin Assessment District No. 85-1 Improvement Bonds (the "85-1 Bonds") in the original principal amount of $50,650,000; WHEREAS, the City Council, by Resolution No. 88-61, adopted on June 13, 1988, resolved its intention to form City of Tustin Assessment District No. 86-2 ("District 86-2") and to issue bonds to represent unpaid assessments therein; WHEREAS, the City Council, by Resolution No. 88-81, adopted on July 18, 1988, con_fumed said assessments; WHEREAS, Pursuant to Resolution No. 88-97 of the City Council, adopted on September 6, 1988, an Indenture of Trust, dated as of September 1, 1988 (the "86-2 Indenture"), by and between the City and Citibank, N. A., as trustee, and the Bond Law, the City issued City of Tustin Assessment District No. 86-2 Limited Obligation Improvement Bonds (the "86-2 Bonds") in the original principal amount of $81,400,000; WHEREAS, certain savings and efficiencies may be obtained by refunding the $14,490,000 aggregate principal amount of 85-1 Bonds that have been converted to a fixed interest rate pursuant to the 85-1 Indenture and the $35,910,000 aggregate principal amount of 86-2 Bonds that have been converted to a fixed interest rate pursuant to the 86-2 Indenture (said · portion of the 85-1 Bonds and said portion of the 86-2 Bonds being collectively referred to as the "Prior Bonds"); and WHEREAS, the Ci~ desires to refund the Prior Bonds; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Tustin as follows: Section 1. The City Council hereby determines that the public interest requires the. refunding of the Prior Bonds and the City Council hereby declares its intention to refund the Prior Bonds and to levy reassessments in and for the City's proposed Reassessment District No. 95-1 (TUstin Ranch) (the "District") as security for the City of Tustin Limited Obligation Improvement Bonds, Reassessment District No. 95-1 (Tustin Ranch) (the "Bonds") proposed to be issued to refund the Prior Bonds. Section 2. The proceedings for the levy and collection of reassessments as security for the issuance and payment of the Bonds shall be conducted pursuant to the Refunding Act of 1984 for 1915 Improvement Act Bonds, Division 11.5 (commencing with Section 9500) of the California Streets and Highways Code (the "Act"). Section 3. The contemplated reassessments and refunding,'in the opinion of the City Council, are of more than local or ordinary public benefit, and the costs and expenses thereof are made chargeable upon the District, the exterior boundaries of which are shown on the maps thereof heretofore filed in the office of the City Clerk, and in the office of the County Recorder of the County of Orange to which maps reference is hereby made for further particulars. The maps indicate by boundary lines the extent of the territory included in each of District 85-1 and District 86-2 which are the subject of these proceedings and shall govern for all details as to the extent thereof. Section 4. The City Council declares that all public streets, highways, lanes arid alleys within the District in use in the performance of a public function, and all lands owned by any public entity, including the United States and the State of California, or any departments thereof, shall be omitted from the reassessment hereafter to be made to cover the costs and expenses of the reassessment and refunding. Section 5. The City Council declares that it elects to establish a special reserve fund for the Bonds pursuant to Pan 16 (commencing with Section 8880) of Division 10 of the California Streets and Highways Code and, therefore, the amount of such special reserve fund shall be included in the contemplated reassessment. Section 6. The reassessment and refunding are hereby referred to Muni Financial Services, Inc., Temecula, California, a qualified firm employed by the City for the purpose hereof (the "Reassessment Consultant"), and the Reassessment Consultant is hereby directed to make and file with the City Clerk a report in writing, presenting the following: (a) A schedule setting forth the unpaid principal and interest on the Prior Bonds to be refunded and the total amounts thereof; (b) The total estimated principal amount of the reassessment and of the Bonds to be secured by the unpaid reassessments and the maximum interest thereon, together with an estimate of cost of the reassessment and refunding, including all costs of issuing the Bonds, as defined by subdivision (a) of Section 9600 of the Act; (c) The auditor's record kept pursuant to Section 8682 of the California Streets and Highways Code showing the schedule of principal installments and interest on all unpaid original assessments for the Prior Bonds and the total amounts thereof; (d) The estimated amount of each reassessment, identified by re. assessment number corresponding to the reassessment number of the reassessment diagram, together with a proposed auditor's record for the reassessment prepared in the manner described in said Section 8682; and (e) A reassessment diagram showing the assessment district and the boundaries and dimensions of the subdivisions of land within the district. Each subdivision, including each separate condominium interest as defined in Section 783 of thc Civil Code, shall be given a separate number upon the diagram. When any portion or percentage of the costs and expenses of. th'e reassessment and refunding is to be paid from sources other than the reassessments, the amount of such portion or percentage shall first be deducted from the total estimated cost and expenses of the reassessment and refunding, and the reasseSsments shall include only the remainder of the estimated cost and expenses, If any excess shall be realized from the reassessment it shall be used, in such amounts as the City Council may determine, in accordance with the provisions of law, in a manner or manners to be provided in these proceedings. Section 7. Notice is hereby given that the Bonds, representing the unpaid reassessments,' in the form of serial and/or term bonds and bearing interest at rates not to exceed the maximum · rate authorized by applicable law at the time of such sale, will be issued in these proceedings in the manner provided by the Act and the Bond Law, the last installment of which Bonds shall mature no later than September 2, 2013. Pursuant to Section 8650.1 of the Bond Law, the City Council hereby determines that the principal amount of the Bonds maturing or becoming subject to mandatory prior redemption each year may be other than an amount equal to an even annual proportion of the aggregate principal of the Bonds. Under the Bond Law, the City will not obligate itself to advance available funds from the treasury of the City to cure any deficiency in the redemption fund to be created with respect to the Bonds; provided, however, that a determination not to obligate itself shall not prevent the City from, in its sole discretion, so advancing the funds.. Section 8. The provisions of Part 11.1 of Division 10 of the California Streets and Highways Code, providing for an alternative procedure for the advance payment of reassessments and the calling of bonds, shall apply to the Bonds issued under .these proceedings. Section 9. Reference is hereby made to proceedings heretofore had under Division 4 of the California Streets and Highways Code for the Prior Bonds, which are on file in the office of the City Clerk. Section 10. The officers and employees of the City are hereby authorized and directed to take all actions and do all things which they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof. Section 11. This Resolution shall take effect immediately upon its adoption. APPROVED and ADOPTED by the City Council of the City of Tustin on November 20, 1995. Jim Potts, Mayor ATI'EST: Pamela Stoker, City Clerk STATE OF'CALIFORNIA ) COUNTY OF ORANGE ) ss I, Pamela Stoker, City Clerk of the City of Tustin, California hereby certify that the foregoing is a full, true and correct copy of a Resolution duly adopted at a regular meeting of the City Council of said City duly and regularly held at the regular meeting place thereof on November 20, 1995, of which meeting all of the members of said City Council had due notice and at which a majority thereof were present; and that at said meeting said Resolution was adopted by the following vote: AYES: COUNCIL MEMBERS: NOES: COUNCIL MEMBERS: ABSENT: COUNCIL MEMBERS: An agenda of said meeting was posted at least 72 hours before said meeting at 300 Centennial Way, Tustin, California, a location freely accessible to members of the public, and a brief general description of said Resolution appeared on said agenda. I further certify that I have carefully compared the same with the original minutes of said meeting on file and of record in my office; that the foregoing Resolution is a full, true and correct copy of the original Resolution adopted at said meeting and entered in said minutes; and that said Resolution has not been amended, modified or rescinded since the date of its adoption, and the same is now in full force and effect. Dated: ,1995 Pamela Stoker, City Clerk RESOLUTION NO. 95-116 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN ADOPTING THE REASSESSMENT REPORT FOR REASSESSMENT DISTRICT NO. 95-1 (TUSTIN RANCH), CONFIRMING AND ORDERING THE REASSESSMENT PURSUANT TO SUMMARY PROCEEDINGS THEREFOR AND DIRECTING ACTIONS WITH RESPECT THERETO Reassessment District No. 95-1 (Tustin Ranch) WHEREAS, the City Council (the "City Council") of the City of Tustin (the "City"), by a Resolution entitled "A Resolution of the City Council of the City of Tustin of Intention to Levy Reassessments and to Issue Refunding Bonds Upon the Security Thereof", adopted on November 20, 1995 (the "Resolution of Intention"), resolved its intention to form Reassessment District No. 95-1 (Tustin Ranch) (the "District") as security for the City of Tustin Limited Obligation Improvement Bonds, Reassessment District No. 95-1 (Tustin Ranch) (the "Bonds") and therein directed the making and filing of a reassessment report (the "Report") in writing in accordance with and pursuant to the Refunding Act of 1984 for 1915 Improvement Act Bonds, Division 11.5 of the California Streets and Highways Code (the "Act"); and WHEREAS, the Report was duly made and filed, and duly considered by the City Council and found to be sufficient in every particular, and the Report shall stand for all subsequent proceedings under and pursuant to the aforesaid Resolution of Intention. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Tustin as follows: Section 1. Pursuant to Section 9525 of the Act, and based upon the Report, the City Council finds that all of the following conditions are satisfied: (a) Each of the estimated annual installments of principal and interest on the reassessment as set forth in the Report is less than the corresponding annual installment of principal and interest on the original assessment as also set forth in the Report,. by the same percentage for all subdivisions of land with the District; (b) The number of years to maturity of all Bonds proposed to be issued is no more than the number of years to the last maturity of the bonds being refunded (the "Prior Bonds"); and (c) The principal amount of the re. assessment on each subdivision of land within the District is less than the unpaid principal amount of the original assessment by the same percentage for each subdivision of land in the District. Section 2. The public interest, convenience and necessity require that said re. assessment be made. Section 3. The district benefited by said reassessment and to be reassessed to pay the costs and expenses thereof, and the exterior boundaries thereof, are as shown by a map thereof heretofore fried in the office of the City Clerk, which map is made a part hereof by reference thereto. Section 4. Pursuant to the findings hereinabove expressed with respect to Section 9525 of the Act, said conditions, and all of them, are deemed satisfied 'and the following elements of the Report are hereby finally, approved and confirmed without further proceedings, including the conduct of a public hearing under the Act: (a) a schedule setting forth the unpaid principal and interest on the Prior Bonds to be refunded and the total amounts thereof; (b) an estimate of the total principal amount of the reassessment and of the Bonds and the maximum interest thereon, together with an estimate of the cost of the reassessment and of issuing the Bonds, including expenses incidental thereto; (c) the auditor's record kept pursuant to Section 8682 of the California streets and Highways Code showing the Schedule of principal installments and interest on all unpaid original assessments and the total amounts thereof; (d) the estimated amount of each reassessment, identified by reassessment number corresponding to the reassessment number of the reassessment diagram, together with a proposed auditor's record for the reassessment prepared in the manner described in said Section 8682; and (e) a reassessment diagram showing the District and the boundaries and dimensions of the subdivisions of land therein. Section 5. Final adoption and approval of the Report as a whole, the estimate of the costs and expenses, the reassessment diagram and the reassessment, as contained in the Report, as hereinabove determined and ordered, is intended to and shall refer and apply to the Report, or any portion thereof, as amended, modified, revised or corrected by, or pursuant to and in accordance with, any resolution or.order, if any, heretofore duly adopted or made by the City Council. Section 6. Said reassessment, including all costs and expenses thereof, is hereby levied. Pursuant to the provisions of the Act, reference is hereby made to the Resolution of Intention for further particulars. Section 7. Based on the oral and documentary evidence, including the Report, offered and received by the City Council, the City Council expressly finds and determines: (a) that each of said several subdivisions of land will be specially benefited by said reassessment at least in the amount, if not more than the amount, of the reassessment apportioned against such subdivision of land; and (b) that there is substantial evidence to support, and the weight of said evidence preponderates in favor of, the aforesaid finding and determination as to special benefits. Section 8. That the City Clerk shall forthwith cause: (a) the reassessment to be delivered to the official of the City who is the Superintendent of Streets of the City, together.with said reassessment diagram, as · approved and confirmed by the City Council, with a certificate of such confirmation and of the date thereof, executed by the City Clerk, attached thereto. Said Superintendent of Streets shall record said reassessment and .reassessment diagram in a suitable book to be kept for that purpose, and append thereto a certificate of the date of such recording, and such recordation shall be and constitute the reassessment roll herein; (b) a copy of said reassessment diagram and a notice of reassessment, executed by the City Clerk, to be filed and recorded, respectively, in the office of the County Recorder of the County of Orange, such notice to be in substantially the form provided in Section 3114 of the California Streets and Highways Code; and (c) a copy of this Resolution to be provided to the Auditor of the County of Orange. From the date of recording of said notice of reassessment, all persons shall be deemed to have notice of the contents of such reassessment, and each of such reassessments shall thereupon be a lien upon the property against which it is made and, unless sooner discharged such liens shall so continue for the period of 19 years'from the date of said recordation, or in the event bonds are issued to represent said reassessments, .then such liens shall continue until the expiration of four years after the due date of the last installment upon said bonds or of. the last installment of principal of said bonds. The appropriate officer or officers are hereby authorized to pay any and all fees required by law in connection with the above. Section 9. The officers and employees, of the City are hereby authorized and directed to take all actions and do all things which they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof. Section 10. This Resolution shall take effect immediately upon its adoption. APPROVED and ADOPTED by the City Council of the City of Tustin on November 20, 1995. Jim Potts, Mayor ATTEST: Pamela Stoker, City Clerk STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS I, Pamela Stoker, City Clerk of the City of Tustin, Califomia hereby certify that the foregoing is a full, true and correct copy of a Resolution duly adopted at a regular meeting of the City Council of said City duly and regularly held at the regular meeting place thereof on November 20,' 1995, of which meeting all of the members of said City Council had due notice and at which a majority thereof were present; and that at said meeting said Resolution was adopted by the following vote: AYES:, COUNCIL MEMBERS: NOES: COUNCIL MEMBERS: ABSENT: COUNCIL MEMBERS: An agenda of said meeting was posted at least 72 hours before said meeting at 300 Centennial Way, Tustin, California, a location freely accessible to members of the public, and a brief general description of said Resolution appeared on said agenda. I further certify that I have carefully compared the same with the original minutes of said meeting on file and of record in my office; that the foregoing Resolution is a full, true and correct copy of the original Resolution adopted at said meeting and entered in said minutes; and that said Resolution has not been amended, modified or rescinded since the date of its adoption, and the same is now in full force and effect. Dated: ,1995 Pamela Stoker, City Clerk