HomeMy WebLinkAboutRDA BOND FIN'CL CONS. 09-20-82f DATE: Sept. 17, 1982 REDEVELOPMENT AGENCY No. 8 9-20-82 lnter-Com TO: FROM: SUBJECT: REDEVELOPMENT AGENCY BILL HUSTON, EXECUTIVE DIRECTOR AUTHORIZATION TO RETAIN MILLER & SCHROEDER MUNICIPALS, INC. AS THE AGENCY BOND FINANCIAL CONSULTANT RECOMMENDATION: That the Agency authorize the Chairman to executve an agreement with Miller & Schroeder, Inc. Under terms of the agreement, Miller & Schroeder, Inc. will serve as the Agency's financial consultant in connection with the issuance of tax allocation bonds. Miller & Schroeder will be responsible for preparing the financial analysis and information required in order to offer bonds for public sale. Miller & Schroeder will al so provide technical assistance to the Agency's bond counsel. The fee of $5.00 per $1,000 par value of the principal amount of the bonds sold would amount to $40,675 for a gross bond issue of $8,135,000. The fee is consistent with the prevailing fee for bond financial consultant/under- writer services and would be paid from the proceeds of the bond sale. WH:dmt CONTRACT EMPLOYING FINANCIAL CONSULTANT THIS AGREEMENT, made and entered into this day of , 1982, by and between the TUSTIN COMMUNITY REDEVELOPMENT AGENCY, Tustin, California, duly or- ganized under the laws of the State of California (hereinafter called "Agency") and MILLER & SCHROEDER MUNICIPALS, INC., 505 Lomas Santa Fe Drive, Solana Beach, California (hereinafter called "Consultant"): WITNES SETH WHEREAS, the Agency has heretofore initiated its redevelopment project within the City; and WHEREAS, the Agency requires assistance in the de- velopment of a sound, equitable and practical financing plan to provide land assembly, new commercial projects, and rehabil- itation and expansion of the water system and other capital improvements by taking into consideration sources of capital funds and cash flow requirements, annual costs, the allocation of those costs, statutory requirements and restrictions, and alternate financing methods, if applicable; and WHEREAS, the Agency, after due investigation and deliberation, has determined that the Consultant is qualified by training and experience to perform said services; to-wit: NOW, THEREFORE, it is mutually agreed as follows, The Agency hereby employs the Consultant and the Consultant hereby accepts such employment to perform the services upon the terms, subject to the conditions, and in consideration of payments as hereinafter set forth: Services to be Performed by the Consultant: The Consultant shall perform in a diligent manner the following services: 1. When the Agency has approved a specific project or projects for implementation, the estimated costs and method of financing of which have been sufficiently well established to permit the preparation of a final financing plan, the Con- sultant shall, at the direction of the Agency, prepare such plan containing, in addition to other information, the follow- ing: A. A description of the project or projects, and their subareas, including the purpose, benefits, estimated costs and other pertinent information. B. Details relating to the proposed method of financing, includin9 tentative bond amortization schedules, call features, sources and amounts of funds to be used in amĀ¢.r- tizing the costs and other related data. C. Illustrations and examples of the financial effects of the financing program on typical property owners, taxpapers or beneficiaries of the specific program~ D. Reccmmendations as to further p~ocedures. 2. If bonds or other evidences of indebtedness to finance all or part of the ccsts of the proposed improvements are authorized to be issued by a building authority, parking authority, City or Agency, the Consultant shall: A. Make recommendations as to exact terms and conditions under which bonds are to be issued and sold, in- cluding timing and method of sale, final amortization or repay- ment schedules, call and redemption features and other details. B. Assist bond counsel in drafting the necessary resolution of issuance and notice of sale. 3. Upon approval by the Agency of final financing details and upon direction by the Agency to do so, prepare the text and other material for an official statement or bond prospectus describing the improvements, the bonds, their security and the economic and financial background of the City. 4. Arrange for printing and distribution of the official statement and other related material to a comprehensive list of prospective bond bidders and the printing of the bonds, all subject to the prior written approval of Agency. 5. Make such trips, and schedule such conferences, in financial centers throughout the United States as are necessary or proper to generate maximum interest in, and acceptance of, the proposed bonds, notes or obligations among both underwriters and ultimate investors. The Consultant shall distribute copies of the official statement or pertinent documentation to bond underwriters and interested ultimate investors located in the aforesaid financial centers. 6. Take such other steps as appear advisable to encourage strong competitive bidding for the bonds. 7. If non-profit corporation financing is to be included in the financing program, the Consultant shall recom- mend: -2- A. The timing and procedures to be used in: (i) forming a non-profit corporation, (ii) obtaining the necessary Internal Revenue Service ruling as to tax exempt- ion of the securities to be issued, (iii) complying with the Securities and Exchange Commission regulations if a public sale of securities proves to be desirable, (iv) sale of securities and deposit of proceeds with the Trustee, and (v) disbursement and application of funds. B. Specific terms governing the issuance of the bonds of the non-profit corporation, including the amount of the issue, a debt retirement schedule, call and redemption features, denominations, application of bond proceeds and rental agreements. In recommending the amount of bonds to be issued, the Consultant shall use its best efforts to keep incidental costs, such as interest during construction, reserve funds and other charges, to a minimum in order to avoid over capitalization. 8. The Consultant shall be available at reasonable times by telephone or at the offices of the Agency to discuss on a continuing basis the results of studies and analyses and generate such additional information as desired or requested and consult with the Agency as to the financial aspects of any specific project then being considered. Payment for Services: 9. For the services to be performed hereunder, the Agency agrees to pay the Consultant an amount equal to $5.00 per $1,000.00 par value (0.5%) of the principal amount of the obligations of each issue of the Agency, but not less than $15,000.00 per issue. Such sums shall become payable only upon delivery by the Agency (or the legal entity or entities issuing such bonds, notes or obligations) of such bonds. The Agency shall not otherwise be liable to the Consultant for any other sums except as specifically set forth in this Agreement. Other Considerations: 10. The Consultant is employed hereunder to render a professional service as a municipal financing consultant and any payments made to it are compensation solely for such service and advice. The Consultant shall bear all out-of- pocket costs and expenses, including without limitation, travel, telephone, telegraph, stenographic work, and the like, incurred by the Consultant in performing the Consultant's duties and obligations, unless the incurring of such costs and expenses is specifically authorized in writing by the Agency. The Con- sultant is not responsible for and shall not be held liable for any other expense or expenditure in connection with the financing program. -3- A. The Agency or the legal entity or entities issuing bonds, notes or obligations shall bear the cost of printing, mailing and distributing any official statement, any notice of sale, any printing of documents and securities, publication, bond counsel fees and rating fees. 11. The Consultant, with the express written consent of the Agency, obtained prior t0 submittal of such bid, may bid on the Agency's obligations at public sale. 12. The Agency agrees that its officials and employees will be requested and directed to cooperate with and assist representatives of the Consultant to the end that Consultant may secure all information and data required to perform the services herein provided. 13. The term of this Agreement shall be five (5) years from the date hereof, but may be cancelled without cause by either party by giving the other party thirty (30) days written notice of such cancellation. IN WITNESS WHEREOF, said Agency, party of the first part, has caused these presents to be properly executed, and said Consultant, party of the second part, has caused these presents to be executed by one of its officers, as of the date hereinabove set forth. TUSTIN COMMUNITY REDEVELOPMENT AGENCY ATTEST: BY: Secretary MILLER & SCHROEDER MUNICIPALS, INC. BY: JGR:se:D:9/14/82 -4-