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HomeMy WebLinkAboutFA - 46RESOLUTION NO. FA- 46 RESOLUTION OF THE BOARD OF DIRECTORS OF THE CITY OF PALM SPRINGS FINANCING AUTHORITY AUTHORIZING THE ISSUANCE OF ITS REVENUE BONDS IN THE ORIGINAL PRINCIPAL AMOUNT OF NOT TO EXCEED $40,000,000 IN CONNECTION WITH THE FINANCING OF PUBLIC CAPITAL IMPROVEMENTS IN THE CITY OF PALM SPRINGS AUTHORIZING AND DIRECTING EXECUTION OF AN INDENTURE OF TRUST, A LEASE AGREEMENT, AN AGENCY AGREEMENT, AND AUTHORIZING AN OFFICIAL STATEMENT AND OTHER OFFICIAL ACTIONS AND EXECUTION OF RELATED DOCUMENTS WHEREAS, the City of Palm Springs Financing Authority (the "Authority") has been formed pursuant to a Joint Exercise of Powers Agreement dated February 1, 1991, by and between the City of Palm Springs (the "City"), and the Redevelopment Agency of the City of Palm Springs (the "Agency"), as amended by that Amendment to Joint Exercise of Powers Agreement, dated as of July 5, 2011, between the City and the Agency, and as further amended by the Second Amendment to Joint Exercise of Powers Agreement, dated as of July 1, 2014, among the City, the Successor Agency to the Palm Springs Community Redevelopment Agency, and the Housing Authority of the City of Palm Springs (together, the "Joint Powers Agreement")and is authorized under said Agreement and under the laws of the State of California to finance the acquisition and construction of public capital improvements for the City; and WHEREAS, the City has requested the Authority to issue its bonds for the purpose of providing funds to enable the City to finance certain improvements of the Library and Swim Center and such other public capital improvements as the City deems necessary (the "2025 Project"), and WHEREAS, to provide such financing for the 2025 Project, the Authority proposes to issue its 2025 Lease Revenue Bonds (Public Facilities Renovation and Expansion Project) in an aggregate principal amount of not to exceed $40,000,000 (the "Bonds") under the provisions of Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the "Act"), such Bonds may be issued in one or more series in such amounts as may be determined by the Authority as stated herein, and which are proposed to be payable from the revenues to be derived by the Authority from lease payments to be made by the City for the lease of certain facilities pursuant to that certain Lease Agreement relating to the financing of the 2025 Project (the "Lease Agreement"), and the lease and sublease of the Leased Premises (as defined below); and Resolution No. FA-46 Page 2 WHEREAS, the City Council has determined that the Library and all or a portion of Sunrise Park and improvements thereon should be the leased assets under the Lease Agreement (the "Leased Premises"); and WHEREAS, a portion of the proceeds of the Bonds will be deposited in the Acquisition and Construction Fund to be established pursuant to the Indenture of Trust which is hereinafter approved, and will be applied by the Authority and the City to the acquisition, construction and installation of the 2025 Project pursuant to an Agency Agreement between the Authority and the City; and WHEREAS, the City and the Authority have previously used the Leased Premises for financings which have been paid in full and any legal encumbrances remaining may be removed with a form of Release of Lien and Termination Agreement (the "Termination Agreement"), presented to this meeting; and WHEREAS, there has also been presented to the Board a form of Continuing Disclosure Certificate to be executed and delivered by the Authority (the "Continuing Disclosure Certificate"), for the benefit of the owners of the Bonds and in order to assist the purchaser of the Bonds in complying with Rule 15c2-12(b)(5) of the Securities and Exchange Commission, as amended (the "Rule"); and WHEREAS, the Authority intends on competitively bidding the sale of the Bonds pursuant to the terms and conditions set forth in the proposed form of Notice of Intention to Sell Bonds (the "Notice of Sale") and Official Notice Inviting Bids; WHEREAS, the City Council has conducted a noticed public hearing held May 28, 2025 pursuant to Section 6586.5 of the California Government Code and published notice was given in accordance with the terms of the Government Code; and WHEREAS, Section 5852.1 of the California Government Code ("Section 5852.1 ") provides that the Authority shall obtain from an underwriter, financial advisor, or private lender and disclose, in a meeting open to the public prior to authorization of the issuance of the Bonds, good faith estimates of (a) the true interest cost of the Bonds, (b) the finance charge of the Bonds, meaning the sum of all fees and charges paid to third parties, (c) the amount of proceeds of the Bonds received less the finance charge described above and any reserves or capitalized interest paid or funded with proceeds of the Bonds, and (d) the sum total of all debt service payments on the Bonds calculated to the final maturity of the Bonds plus the fees and charges paid to third parties not paid with the proceeds of the Bonds; and WHEREAS, in accordance with Section 5852.1, the Authority has obtained such good faith estimates from Harrell & Company Advisors, LLC, the Authority's and City's municipal advisor (the "Municipal Advisor"), and such estimates are disclosed in Exhibit A attached hereto; and 1 Resolution No. FA-46 Page 3 WHEREAS, the Board of Directors of the Authority (the "Board") has duly considered such transactions and has determined that it approves said transactions in the public interests of the City and the Authority. THE BOARD OF THE CITY OF PALM SPRINGS FINANCING AUTHORITY DOES HEREBY RESOLVES, DETERMINES, AND APPROVES AS FOLLOWS: SECTION 1. Findings and Determinations. A. Pursuant to the Act, the Board hereby finds and determines that significant public benefits will arise from the issuance of the Bonds to fund the Library and Swim Center renovation costs, including demonstrable savings in effective interest rate, bond preparation, or bond issuance costs pursuant to Section 6586 of the Act. B. The Board finds and determines that the above recitals are true and correct and that the fair rental value of Leased Premises exceeds the present value of Lease Payments to be made under the Lease Agreement. SECTION 2. Issuance of Bonds. The Board hereby authorizes the issuance of the Bonds for the purpose of funding the 2025 Project under and pursuant to the Act, in the maximum original principal amount not to exceed $40,000,000. The Bonds may be issued in one or more series. SECTION 3. Approval of Financing Documents. The Board hereby approves each of the following documents in substantially the respective forms on file with the Secretary and presented at this meeting, together with such additions thereto and changes therein as Bond Counsel shall deem necessary, desirable, or appropriate, the execution of which by the Chairperson, the Vice Chairperson, the Executive Director, or the Treasurer (each an "Authorized Officer") shall be conclusive evidence of the approval of any such additions and changes: A. that certain Indenture of Trust, by and between the Authority and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"), establishing the terms and conditions pertaining to the issuance, sale, and administration of the Bonds (the "Indenture of Trust"); B. the Lease Agreement, by and between the Authority and the City relating to the lease and sublease of the Leased Premises, together with any memorandum of such Lease Agreement to be recorded; C. the preliminary official statement describing the City, the Authority, and the Bonds (the "Preliminary Official Statement"); D. the Agency Agreement, by and between the Authority and the City; Resolution No. FA-46 Page 4 E. the Termination Agreement among the City, the Authority and the trustee relating to the prior encumbrance; and F. the Continuing Disclosure Certificate relating to the Bonds, attached as an appendix to the Preliminary Official Statement. The Authorized Officers are each, acting alone, hereby authorized and directed to execute, and the Secretary is hereby authorized and directed to attest and affix the seal of the Authority to, the final form of each of the foregoing documents and agreements for and in the name and on behalf of the Authority, with such addition and changes thereto as deemed necessary, desirable or appropriate by Bond Counsel. The Board hereby authorizes the delivery and performance of each of the foregoing documents and agreements. SECTION 4. Sale of Bonds via Competitive Sale. The Board hereby authorizes the sale of the Bonds through generally accepted electronic means to the highest bidder, after advertising for bids by publication of notice of sale pursuant to Government Code Section 53692; provided, however, that if no bids are received or if the Board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the Board may reject all bids received, if any, and readvertise the sale of the Bonds. The Bonds shall be offered at competitive sale in accordance with the Official Notice Inviting Bids (the "Notice Inviting Bids") in substantially the form on file with the Secretary and presented at this meeting together with any additions thereto or changes therein approved by an Authorized Officer, the distribution thereof to be conclusive evidence of such approval. The Board hereby delegates to the Authorized Officers the authority to accept an offer from an underwriter to purchase the Bonds from the Authority pursuant to the Notice Inviting Bids; provided, however, that Bonds shall be awarded to an underwriter only if the principal amount of the Bonds does not to exceed $40,000,000 and; the true interest cost does not exceed 6.0%. Each Authorized Officer is authorized to determine the day on which the Bonds are to be priced in order to attempt to produce the lowest borrowing cost and may reject any terms of the sale if determined not to be in the best interest of the Authority. SECTION 5. Official Statement; Continuing Disclosure. The Board hereby approves the preparation of, and hereby authorizes the Executive Director or the Treasurer to deem final within the meaning of Rule 15c2-12 of the Securities and Exchange Commission except for permitted omissions, a preliminary form of Official Statement of the Bonds. The Executive Director and the Treasurer are each, acting alone, hereby authorized to execute the final Official Statement in the name and on behalf of the Authority, including any modifications resulting from additions thereto and changes therein as Bond Counsel shall deem necessary, desirable, or appropriate, with the execution of the final Official Statement by an Authorized Officer to be conclusive evidence of the approval of any such additions and changes. The Executive Director or the Treasurer are each, acting alone, further authorized to sign on behalf of the Authority Resolution No. FA-46 Page 5 the Continuing Disclosure Certificate with respect to the financing, in such form as may be approved by Bond Counsel. SECTION 6. Notice of Sale. The Executive Director is hereby authorized and directed to publish a Notice of Sale pursuant to Government Code Section 53692 in The Bond Buyer at least 5 days prior to the date bids are to be received. The Executive Director in cooperation with Harrell & Company Advisors, LLC, the City's municipal advisor, shall cause an official notice inviting bids to be circulated among prospective bidders. SECTION 7. Appointment of Professionals. A. Municipal Advisor. Harrell & Company Advisors, LLC. is hereby appointed to serve as the municipal advisor to the Authority in connection with the issuance of the Bonds. B. Bond and Disclosure Counsel. Best Best & Krieger LLP is hereby appointed to serve as Bond and Disclosure Counsel to the Authority in connection with the issuance of the Bonds. C. Trustee. U.S. Bank Trust Company, National Association is hereby selected as the Trustee under the Indenture of Trust. SECTION 8. Official Actions. The Authorized Officers, the Secretary, and any and all other officers of the Authority are hereby authorized and directed, for and in the name and on behalf of the Authority, to do any and all things and take any and all actions, including obtaining title insurance for the Leased Premises, obtaining a rating on the Bonds, and including execution and delivery of any and all assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and other documents, which they, or any of them, may deem necessary or advisable in connection with the issuance and sale of the Bonds. SECTION 9. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption. Resolution No. FA-46 Page 6 ADOPTED THIS 28TH DAY OF MAY 2025. ATTEST: ALL - Brenda ree, MMC, CERA City Clerk colt Stiles, City Manager CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF PALM SPRINGS) I, BRENDA PREE, City Clerk of the City of Palm Springs, hereby certify that Resolution No. FA- 45 is a full, true and correct copy, and was duly adopted at a regular meeting of the City Council of the City of Palm Springs on the 28th day of May, by the following vote: AYES: Councilmembers Ready, Garner, Bernstein, Mayor Pro Tern Soto, and Mayor deHarte NOES: None ABSENT: None ABSTAIN: None IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Springs, California, this day of June 2025. AL�L' Brenda Pree, MMC, CERA City Clerk 0 Resolution No. FA-46 Page 7 EXHIBIT A GOOD FAITH ESTIMATES The good faith estimates set forth herein are provided with respect to the Bonds in accordance with California Government Code Section 5852.1. Such good faith estimates have been provided to the Authority by the Municipal Advisor in consultation with the Underwriter. Principal Amount. The Municipal Advisor has informed the Authority that, based on the financing plan and current market conditions, its good faith estimate of the aggregate principal amount of the Bonds to be sold is $38,210,000 (the "Estimated Principal Amount"). True Interest Cost of the Bonds. The Municipal Advisor has informed the Authority that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the true interest cost of the Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the Bonds, is 4.65%. Finance Charge of the Bonds. The Municipal Advisor has informed the Authority that, assuming that the Estimated Principal Amount of Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the finance charge for the Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the Bonds), is $567,000. Amount of Proceeds to be Received. The Municipal Advisor has informed the Authority that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the amount of proceeds expected to be received by the Authority for the sale of the Bonds, less the finance charge of the Bonds, as estimated above, and any reserve fund paid or funded with proceeds of the Bonds $37,000,000, Total Payment Amount. The Municipal Advisor has informed the Authority that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the total payment amount, which means the sum total of all payments the Authority will make to pay debt service on the Bonds, plus the finance charge for the Bonds, as described above, together with the sum of annual ongoing costs to administer the bonds not paid with proceeds of the bonds, calculated to the final maturity of the Bonds, is $76,966,000. The foregoing estimates constitute good faith estimates only. The actual principal amount of the Bonds issued and sold, the true interest cost thereof, 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 Resolution No. FA-46 Page 8 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 Principal Amount, (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 alterations in the financing plan or finance charges, or a combination of such factors. The actual date of sale of the Bonds and the actual principal amount of Bonds sold will be determined by the Authority based on the timing of the need for proceeds of the Bonds and other factors. The actual interest rates borne by 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. ni