Loading...
HomeMy WebLinkAboutA04 City Res 24-07Quint & Thinunig LLP $4,125,000 TUSTIN PUBLIC FINANCING AUTHORITY Water Revenue Bonds, Series 2024 (Subordinate Lien) CERTIFICATE REGARDING CITY RESOLUTION The undersigned hereby states and certifies: 2/7/24 A4 (i) that the undersigned is the duly elected, qualified and acting City Clerk of the City of Tustin, a general law city and municipal corporation duly organized and existing under the laws of the State of California (the "City"), and as such, is familiar with the facts herein certified and is authorized to certify the same on behalf of the City; and (ii) that attached hereto is a true, correct and complete copy of Resolution No. 24-07, entitled "RESOLUTION OF THE CITY OF TUSTIN, CALIFORNIA, APPROVING PROCEEDINGS TO FINANCE IMPROVEMENTS TO THE CITY'S MUNICIPAL WATER SYSTEM, APPROVING THE ISSUANCE OF WATER REVENUE BONDS BY THE TUSTIN PUBLIC FINANCING AUTHORITY FOR SUCH PURPOSES AND APPROVING RELATED DOCUMENTS AND OFFICIAL ACTIONS," adopted by the City Council of the City on February 6, 2024 (the "Resolution"), which Resolution has not been amended, modified, supplemented, rescinded or repealed and is in full force and effect as of the date hereof. Dated: February 14, 2024 CITY OF TUSTIN By L # jjAA Eric N. Yasuda, ity Clerk DocuSign Envelope ID: 86AE512D-C7DD-42F0-81CF-589F9C6177AB RESOLUTION NO. 24-07 RESOLUTION APPROVING PROCEEDINGS BY THE TUSTIN PUBLIC FINANCING AUTHORITY FOR THE ISSUANCE AND SALE OF ITS TUSTIN PUBLIC FINANCING AUTHORITY (ORANGE COUNTY, CALIFORNIA) WATER REVENUE BONDS TO FINANCE IMPROVEMENTS TO THE CITY'S MUNICIPAL WATER SYSTEM APPROVING THE FORM AND AUTHORIZING EXECUTION OF RELATED DOCUMENTS AND APPROVING RELATED OFFICIAL ACTIONS WHEREAS, the City of Tustin (the "City") and the former Tustin Community Redevelopment Agency (the "Agency") have heretofore entered into a joint exercise of powers agreement (the "Agreement") establishing the Tustin Public Financing Authority (the "Authority") for the purpose, among others, of issuing its bonds to be used to provide financial assistance to the City; WHEREAS, the Successor Agency to the Tustin Community Redevelopment Agency succeeded to the Agency and the Agreement remains in effect so long as obligations of Agency remain outstanding, ending in 2040; WHEREAS, the City proposes to finance the acquisition and construction of certain improvements and facilities (the "2024 Project") to the City's municipal water enterprise (the "Enterprise"); WHEREAS, for the purpose of raising funds necessary to provide such financial assistance to the City, the Authority proposes to authorize the issuance of its revenue bonds under the provisions of Article 4 (commencing with section 6584) of Chapter 5 of Division 7 of Title 1 of the California Government Code (the "Act"), designated as the Tustin Public Financing Authority Water Revenue Bonds, Series 2024 (Subordinate Lien) (the "Bonds"), all pursuant to and secured by an indenture of trust (the "Indenture"), by and between the Authority and The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee"); WHEREAS, in order to provide for the repayment of the Bonds, the Authority will sell the 2024 Project to the City pursuant to an installment sale agreement (the "Installment Sale Agreement"), under which the City will agree to make installment payments to the Authority payable from the net revenues of the Enterprise which will be calculated to be sufficient, in time and amount, to enable the Authority to pay the principal of and interest and premium (if any) on the Bonds when due and payable; WHEREAS, the City's obligations under the Installment Sale Agreement will be subordinate to the City's obligations with respect to the payment of debt service on its City of Tustin (Orange County, California) 2016 Water Refunding Revenue Bonds and its Resolution 24-07 Page 1 of 5 DocuSign Envelope ID: 86AE512D-C7DD-42F0-81CF-589F9C6177AB City of Tustin (Orange County, California) Taxable Water Refunding Revenue Bonds, Series 2020; WHEREAS, Capital One Public Funding, LLC (the "Purchaser") has proposed to extend credit to the Authority and the City by purchasing the Bonds and has presented to the Authority and the City a form of commitment agreement for the Bonds, to be entered into among the Authority, the City and the Purchaser (the "Commitment Agreement"); WHEREAS, the City Council desires to make a finding of significant public benefit pursuant to section 6586.5(a)(2) of the California Government Code and to approve of the financing and the transactions contemplated by the Bonds; WHEREAS, the City Council approves all of said transactions in furtherance of the public purposes of the City, and wishes at this time to take its action approving the issuance and sale of the Bonds and the financing to be accomplished thereby; WHEREAS, the City Council has held a public hearing as required by section 6586.5 of the California Government Code; WHEREAS, issuance of the Bonds is in conformity with the City's Debt Policy; and WHEREAS, pursuant to section 5852.1 of the California Government Code, which became effective on January 1, 2018 by the enactment of Senate Bill 450, certain information relating to the Bonds is set forth in Exhibit A attached to this Resolution, and such information is hereby disclosed and made public; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OIF TUSTIN DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS: Section 1. Recitals True and Correct. The City Council hereby finds and determines that the foregoing recitals are true and correct. Section 2. Findings. The finding being made is that significant public benefits will arise from the issuance of the Bonds to fund the property acquisition and other costs, including demonstrable savings in effective interest rate, bond preparation and bond issuance costs achieved by consolidating the assets being leased. Section 1. Approval of Bonds. The City Council hereby approves the issuance of the Bonds by the Authority for the purpose, among others, of providing funds to finance the 2024 Project, so long as (a) the principal amount of Bonds does not exceed $4,125,000, (b) so long as the final maturity date of the Bonds is not later than April 1, 2044, and (c) the average interest rate on the Bonds is not higher than 4.820%. Resolution 24-07 Page 2of5 DocuSign Envelope ID: 86AE512D-C7DD-42F0-81CF-589F9C6177AB Section 2. Approval of Installment Sale Agreement. The City Council hereby approves the Installment Sale Agreement in the form on file with the City Clerk, together with such additions thereto and changes therein as the Mayor, the City Manager or the Finance Director (the "Designated Officers") shall deem necessary, desirable or appropriate, the execution of which by a Designated Officer shall be conclusive evidence of the approval of any such additions and changes. The Designated Officers, each acting alone, are hereby authorized and directed to execute the final form of the Installment Sale Agreement for and in the name and on behalf of the City. The City Council hereby authorizes the delivery and performance of the Installment Sale Agreement. Section 3. Approval of Placement Agent Agreement. The City Council hereby approves the a placement agent agreement, by and among the Authority, the City and Stifel, Nicolaus & Company, Incorporated, as placement agent (the "Placement Agent Agreement"), in the form on file with the City Clerk, together with such additions thereto and changes therein as the Designated Officers shall deem necessary, desirable or appropriate, the execution of which by a Designated Officer shall be conclusive evidence of the approval of any such additions and changes. The Designated Officers, each acting alone, are hereby authorized and directed to execute the final form of the Placement Agent Agreement for and in the name and on behalf of the City. The City Council hereby authorizes the delivery and performance of the Placement Agent Agreement. Section 4. Sale of Bonds. The City Council hereby approves the sale of the Bonds by the Authority by negotiation with the Purchaser pursuant to the Commitment Agreement in the form on file with the City Clerk, together with such additions thereto and changes therein as a Designated Officer shall deem necessary, desirable or appropriate, the execution of which by a Designated Officer shall be conclusive evidence of the approval of such additions and changes. The Designated Officers, each acting alone, are hereby authorized and directed to execute the final form of the Commitment Agreement for and in the name and on behalf of the City upon the submission of an offer by the Purchaser to purchase the Bonds, which offer is acceptable to a Designated Officer and consistent with the requirements of this Resolution. Section 5. Deposit to the Rate Stabilization Fund. Resolution No. 23-59, adopted by the City Council on December 5, 2023, adjusted the water rates provided by the City and, among other things, established and funded a rate stabilization fund in the amount of $1,063,300, being 5% of the City's expected 2024 water rate revenue. The City Council hereby authorizes the transfer from the City's Emergency Reserve Fund to the Rate Stabilization Fund such additional amount as may be required to insure that the City meets its rate covenant. Section 6. Official Actions. The Mayor, the City Manager, the Finance Director, the City Clerk and any and all other officers of the City are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all actions, including execution and delivery of any and all assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and Resolution 24-07 Page 3of5 DocuSign Envelope ID: 86AE512D-C7DD-42F0-81CF-589F9C6177AB other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and sale of the Bonds and the consummation of the transactions as described herein. Section 7. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption. PASSED AND ADOPTED at a regular meeting of the City Council held on the 6th day of February 2024. DocuSigned by: E€eS63Erod4,4... AUSTIN LUMBARD, Mayor ATTEST: °S �DocuSigned by: Vi(& ga.Su'�,a 0 ERICA N. YASUDA, City Clerk APOPROVED AS TO FORM: DocuSigned by: DAb`ID8f3 ND I G, City Attorney Resolution 24-07 Page 4 of 5 DocuSign Envelope ID: 86AE512D-C7DD-42F0-81CF-589F9C6177AB STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS CITY OF TUSTIN ) I, Erica N. Yasuda, City Clerk and ex-officio Clerk of the City Council of the City of Tustin, California, do hereby certify that the whole number of the members of the City Council of the City of Tustin is five; that the above and foregoing Resolution No. 24-07 was duly passed and adopted at a regular meeting of the Tustin City Council, held on the 6t" day of February 2024, by the following vote: COUNCILMEMBER AYES: Lumbard, Gallagher, Gomez, Schnell (4) COUNCILMEMBER NOES: (0) COUNCILMEMBER ABSTAINED: (0) COUNCILMEMBER ABSENT: Clark (1) COUNCILMEMBER RECUSED: (0) DS DocuSigned by: 4• `LV'iCa (�aStti�,a ERICA N. YASUDA, City Clerk Resolution 24-07 Page 5of5 DocuSign Envelope ID: 86AE512D-C7DD-42F0-81CF-589F9C6177AB LW.4;II-3ki_l GOVERNMENT CODE SECTION 5852.1 DISCLOSURE The following information consists of estimates that have been provided by the Fieldman, Rolapp & Associates, the City's Municipal Advisor which has been represented to have been provided in good faith: (A) True Interest Cost of the Bonds: 4.820% (B) Finance Charges: $125,000 (C) Net Proceeds to be Received: $4,000,000 (net of finance charges) (D) Total Payment Amount through Maturity: $6,559,029.71 The foregoing estimates constitute good faith estimates only and are based on market conditions prevailing at the time of preparation of such estimates. The principal amount of the Bonds, the true interest cost of the Bonds, the finance charges thereof, the amount of proceeds received therefrom and total payment amount with respect thereto may differ from such good faith estimates due to (a) the actual date of the sale of the Bonds being different than the date assumed for purposes of such estimates, (b) the actual principal amount of Bonds sold being different from the estimated amount used for purposes of such estimates, (c) the actual amortization of the Bonds being different than the amortization assumed for purposes of such estimates, (d) the actual market interest rates at the time of sale of the Bonds being different than those estimated for purposes of such estimates, (e) other market conditions, or (f) alterations in the financing plan of the Authority and the City, or a combination of such factors. The actual date of sale of the Bonds and the actual principal amount of the Bonds sold will be determined by the Authority and the City based on the timing of the need for proceeds of the Bonds and other factors. The actual interest rates with respect to the Bonds will depend on market interest rates at the time of sale thereof. The actual amortization of the Bonds will also depend, in part, on market interest rates at the time of sale thereof. Market interest rates are affected by economic and other factors beyond the control of the Authority and the City.