HomeMy WebLinkAbout7/17/2002 - STAFF REPORTS (2) DATE: July 17, 2002
TO: City Council/Financing Authority
FROM: Director of Finance and Treasurer
RE: Bond Financing for Parking Structure
RECOMMENDATION:
It is recommended that the City Council, upon completion of the Public hearing,
approve the various bond documents to issue variable rate taxable bonds not to
exceed $8,000,000 for the purpose of constructing the downtown parking structure and
other parking lot improvements.
SUMMARY:
The 388 space parking structure is currently under construction on the west side of
Indian Canyon north of Baristo Road. The cost of construction, land acquisition,
demolition, other improvements, capitalized interest, and the cost of issuance will be
approximately $8 million. Because there is a significant private participation in this
project, tax exempt bonds cannot be used.
BACKGROUND:
Because of the success in attracting new businesses to downtown, there is a serious
and nearly constant shortage of convenient parking spaces. Recognizing the problem,
the City Council initiated a dialogue between downtown business owners, property
owners, City staff, and other stakeholders in early 2000. After an exhaustive search for
solutions, a number of projects were approved. Arenas Road was reconfigured and
improved, resulting in the creation of an additional 23 spaces. The Henry Frank Arcade
parking lot was improved, with a net increase of 25 spaces.
The major piece of the solution focused on the construction of a parking structure. The
Council committed to the project via a series of actions to hire the architect and
construction manager, initiate eminent domain proceedings to acquire necessary land,
and enter into a number of construction contracts. These actions were taken in May
and June of this year with the anticipation that the initial expenditures (primarily for land
acquisition and relocation costs) would be reimbursed from the proceeds of a bond
issue.
As noted earlier, the parking structure was put together as a public/private partnership.
Substantial portions of the land needed for the structure were contributed by property
owners. In exchange, one deck of the structure will be dedicated for employee parking
for the businesses affected.
Because of this private participation, it was always anticipated that the bond issue
would be a taxable issue. The recommendation of the City's Financial Advisor, I
Suzanne Harrell, is for a variable rate taxable financing with the credit enhancement of
a Letter of Credit. The initial interest rate of the bonds is expected to be approximately
2.75%. With the cost of the LOC, and the remarketing fees, the effective interest rate
for the first year will be 3.85%. With some anticipated increases in rates over the term
of the bond issue, the average effective interest rate is estimated at 6.6% per year.
The rates will be reset weekly, with a maximum annual rate of 12%.
Page 2
There are advantages and disadvantages of using variable rate financing. The current
initial rate is very attractive, and because the rate is reset weekly, a reserve fund (which
would drive up the size of issue and hence the costs) is not necessary. The bonds can
be called at any time at par. The average annual debt service will be about $614,000,
with the first installments due in Fiscal Year 2003-04. The capitalized interest
component of the bond issue will cover the interest costs during construction and for
the remainder of Fiscal Year 2002-03.
The major disadvantage is the potential for a rapid increase in interest rates which
could drive the annual maximum debt service to $1,200,000 per year. However, the risk
of higher interest rates is manageable. The rate on this issue should closely match the
London Inter Bank Offering Rate, or LIBOR. Attached is a table which shows the
monthly LIBOR over the last 10 years. Short term interest rates have fluctuated in a
relatively narrow range during that period. The highest rate was 6.8% in November,
2000. Over the 10 year period, the average monthly rate is slightly less than 5%. If
rates did rise dramatically, the City has three options: call the bonds, using cash
balances in the General Fund and other funds; dedicate the presumably higher interest
earnings the City would get by investing those same cash balances; or convert the
bonds to a fixed rate.
Operationally, the parking structure is expected to cost about $107,000 per year and
bring in about $182,000 per year from the fees paid by the business owners for their
employee parking. In difficult times, the net revenue could be dedicated to debt service.
The various bond documents, including the Trust Agreement, Lease Agreement,
Assignment Agreement, and Resolutions, have been prepared by the City's Bond
Counsel. The Official Statement and a draft of the Purchase Contract with the
Underwriter, Stone & Youngberg, LLC have been prepared or reviewed by the
Financial Advisor. All of the documents are on file in the City Clerk's office. The bond
issue is expected to close on August 1, 2002. The parking structure's target completion
date is November 27, 2002. Attached are copies of the relevant debt service
projections.
Approved Submitted by
David H. Ready Thomas M. Kanarr 11
City Manager Director of Finance and Treasurer
Attachments:
Sources & Uses of Funds I 'C
Bond Debt Service schedule
Net Debt Service
Bond Summary Statistics
LIBOR Rates
Resolutions
SOURCES AND USES OF FUNDS
City of Palm Springs
Taxable Variable Rate Lease Revenue Bonds
Dated Date 07/31/2002
Delivery Date 07/31/2002
Sources:
Bond Proceeds:
Paz Amount 8,000,000.00
8,000,000.00
Uses:
Other Fund Deposits:
Capitalized Interest Fund 361,000.00
Delivery Date Expenses:
Cost of Issuance 260,000.00
Underwriter's Discount 40,000.00
Letter of Credit Fees 74,440.00
Remarketing Fees 10,000.00
384,440.00
Other Uses of Funds:
Parking Projects 7,250,000.00
Additional Proceeds 4,560.00
7,254,560.00
8,000,000.00
f,A 1 — !►
Jul 5,2002 9:56 am Prepared by Harrell&Company Advisors,LLC
BOND DEBT SERVICE
City of Palm Springs
Taxable Variable Rate Lease Revenue Bonds
Dated Date 07/31/2002
Delivery Date 07/31/2002
Period
Ending Principal Interest Debt Service
07/O1/2003 206,849.30 206,849.30
07/01/2004 287,342.46 287,342.46
07/O1/2005 363,287.65 363,287.65
07/O1/2006 403,287.64 403,287.64
07/01/2007 439,999.96 439,999.96
07/01/2008 441,205.44 441,205.44
07/01/2009 439,999.96 439,999.96
07/01/2010 215,000 439,999.96 654,999.96
07/01/2011 230,000 428,175.03 658,175.03
07/01/2012 240,000 416,663.40 656,663.40
07/01/2013 260,000 402,325.02 662,325.02
07/01/2014 275,000 388,025.03 663,025,03
07/01/2015 390,000 372,900.03 762,900.03
07/01/2016 415,000 352,412.88 767,412.88
07/01/2017 440,000 328,625.01 768,625.01
07/01/2018 470,000 304,424.96 774,424.96
07/O1/2019 500,000 278,574.99 778,574.99
07/01/2020 535,000 251,762.88 786,762.88
07/01/2021 570,000 221,650.02 791,650.02
07/01/2022 605,000 190,300.05 795,300.05
07/01/2023 645,000 157,024.98 802,024.98
07/01/2024 690,000 121,882.98 811,882.98
07/01/2025 735,000 83,599.96 818,599.96
07/01/2026 785,000 43,175.01 828,175.01
8,000,000 7,363,494.60 15,363,494.60
Jul 5,2002 9:56 am Prepared by Harrell&Company Advisors,LLC
NET DEBT SERVICE
City of Palm Springs
Taxable Variable Rate Lease Revenue Bonds
Capitalized
Period Total Letter of Remarketing Capitalized Interest Net
Ending Debt Service Credit Fees Fees Interest Fund Debt Service
07/01/2003 206,849.30 68,443.44 9,194.44 284,487.18
07/01/2004 287,342.46 74,440.00 10,000.00 76,512.82 295,269.64 UMM
07/01/2005 363,287.65 74,440.00 10,000.00 447,727.65
07/01/2006 403,287.64 74,440.00 10,000.00 487,727.64
07/01/2007 439,999.96 74,440.00 10,000.00 524,439.96
07/01/2008 441,205.44 74,440.00 10,000.00 525,645.44
07/01/2009 439,999.96 74,440.00 10,000.00 524,439.96
07/01/2010 654,999.96 74,440.00 10,000.00 739,439.96
07/01/2011 658,175.03 72,439.43 9,731.25 740,345.71
07/01/2012 656,663.40 70,299.28 9,443.75 736,406.43
07/01/2013 662,325.02 69,066.09 9,143.75 739,534.85
07/01/2014 663,025.03 65,646.78 8,818.75 737,490.56
07/01/2015 762,900.03 63,087.90 8,475.00 834,462.93
07/01/2016 767,412.88 59,458.95 7,987.50 834,859.33
07/01/2017 768,625.01 55,597.38 7,468.75 831,691.14
07/01/2018 774,424.96 51,503.19 6,918.75 932,846.89
07/01/2019 778,574.99 47,129.83 6,331.25 832,036.07
07/01/2020 786,762.98 42,477.33 5,706.25 834,946.46
07/01/2021 791,650.02 37,499.15 5,037.50 834,186.67
07/01/2022 795,300.05 32,195.30 4,325.00 931,820.35
07/01/2023 802,024.98 26,565.78 3,568.75 832,159.51
07/01/2024 811,882.98 20,564.05 2,762.50 835,209.53
07/01/2025 818,599.96 14,143.60 1,900.00 834,643.56
07/01/2026 828,175.01 7,304.43 981.25 836,460.69
15,363,494.60 1,323,501.89 177,794.44 361,000.00 0 16,503,790.93
Ju15,2002 9:56 am Prepared by Harrell&Company Advisors,LLC
BOND SUMMARY STATISTICS
City of Palm Springs
Taxable Variable Rate Lease Revenue Bonds
Dated Date 07/31/2002
Delivery Date 07/31/2002
Last Maturity 07/01/2026
Arbitrage Yield 6.070309%
True Interest Cost(TIC) 6.117077%
Net Interest Cost(NIC) 5.205094%
All-In TIC 6.566123%
Average Coupon 5.176972%
Average Life(years) 17.779
Duration of Issue(years) 10.260
Par Amount 8,000,000.00
Bond Proceeds 8,000,000.00
Total Interest 7,363,494.60
Net Interest 7,403,494.60
Total Debt Service 15,363,494.60
Maximum Annual Debt Service 828,175.01
Average Annual Debt Service 642,301.48
Underwriter's Fees(per$1000)
Average Takedown
Other Fee 5.000000
Total Underwriter's Discount 5.000000
Bid Price 99.500000
Par Average Average
Bond Component Value Price Coupon Life
Tenn Bond 8,000,000.00 100.000 5.177% 17.779
8,000,000.00 17.779
e Into
Jul 5,2002 10:16 am Prepared by Harrell&Company Advisors,LLC
LIBOR RATES 1 MONTH
Jan-92 4.141 Aug-95 5.907 Mar-99 4.940
Feb-92 4.250 Se -95 5.922 A r-99 4.902
Mar-92 4.250 Oct-95 5.844 Ma -99 4.930
A r-92 3.969 Nov-95 6.032 Jun-99 5.223
Ma -92 4.016 Dec-95 5.735 Jul-99 5.178
Jun-92 3.922 Jan-96 5.469 Au -99 5.370
Jul-92 3.391 Feb-96 5.352 Sep-99 5.396
Aug-92 3.500 Mar-96 5.454 Oct-99 5.410
Se -92 3.188 A r-96 5.454 Nov-99 5.503
Oct-92 3.281 Ma -96 5.446 Dec-99 5.832
Nov-92 3.172 Jun-96 5.516 Jan-00 5.856
Dec-92 3.344 Jul-96 5.493 Feb-00 5.907
Jan-93 3.203 Aug-96 5.430 Mar-00 6.133
Feb-93 3.203 Se -96 5.438 A r-00 6.197
Mar-93 3.203 Oct-96 5.375 May-00 6.641
A r-93 3.141 Nov-96 5.391 Jun-00 6.649
Ma -93 3.203 Dec-96 5.547 Jul-00 6.625
Jun-93 3.203 Jan-97 5.461 Au -00 6.628
Jul-93 3.188 Feb-97 5.469 Se -00 6.620
Au -93 3.203 Mar-97 5.719 Oct-00 6.621
Se -93 3.188 A r-97 5.704 Nov-00 6.827
Oct-93 3.188 Ma -97 5.711 Dec-00 6.565
Nov-93 3.578 Jun-97 5.719 Jan-01 5.622
Dec-93 3.297 Jul-97 5.641 Feb-01 5.278
Jan-94 3.141 Au -97 5.680 Mar-01 5.078
Feb-94 3.594 Se -97 5.672 A r-01 4.435
Mar-94 3.703 Oct-97 5.633 Ma -01 4.059
A r-94 3.938 Nov-97 5.766 Jun-01 3.835
Ma -94 4.375 Dec-97 5.852 Jul-01 3.760
Jun-94 4.563 Jan-98 5.704 Au -01 3.584
Jul-94 4.516 Feb-98 5.789 Sep-01 2.637
Au -94 4.875 Mar-98 5.719 Oct-01 2.321
Se -94 5.000 Apr-98 5.688 Nov-01 2.145
Oct-94 5.078 Ma -98 5.696 Dec-01 1.876
Nov-94 6.000 Jun-98 5.748 Jan-02 1.829
Dec-94 5.984 Jul-98 5.696 Feb-02 1.883
Jan-95 6.078 Au -98 5.727 Mar-02 1.880
Feb-95 6.125 Se -98 5.400 A r-02 1.842
Mar-95 6.141 Oct-98 5.277 Ma -02 1.844
A r-95 6.079 Nov-98 5.048 Jun-02 1.836
Ma -95 6.063 Dec-98 5.118 Average 4.805
Jun-95 6.079 Jan-99 4.946
Jul-95 5.875 Feb-99 1 5.003 FA
'
Proof of Publication
In Newspaper
STATE OF CALIFORNIA
County of Riverside
Laura Reyes says:
1. 1 am a citizen of the United States, a
resident of the City of Indio, County of
Riverside, State of California, and over the
age of 18 years.
2. 1 am the Office & Production Manager of
The Public Record, a newspaper of general PUBLIC NOTICE OF PUBLIC HEARING
CITY OF PALM SPRINGS
circulation printed and published in the City of ._ NOTICE IS HEREBY GIVEN that an Wednesday,July 17,2002
at 7'00 p m.,or as soon as the matter may be heard,the City
Palm Springs, County of Riverside, State Of Council of the City of Palm Springs will hold a public hearing in
California. Said The Public Record is a the Council Chamber 3200 E.Tahgmn Canyon Way, Palm
Springs,California,to consider the adoption of a Resolution,
newspaper of general circulation as that term inhiletl:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
is defined in Government Code section 6000, PALM SPRINGS, CALIFORNIA, AUTHORIZING THE SALE
its status as such havingbeen established b OF ITS TAXABLE VARIABLE RATE DEMAND CERTIFICATES
Y OF PARTICIPATION,2002 SERIES A(DOWNTOWN PARK-
judicial decree Of the Superior Court Of the ING PROJECT), AUTHORIZING EXECUTION AND DELIV-
FRY BY THE CITY OF A TRUST AGREEMENT, A LEASE
State of California in and for the County Of AGREEMENT, A BOND PURCHASE AGREEMENT AND
Riverside in ProceedingNO. Indio 49271, CERTAIN OTHER LEGAL DOCUMENTS,APPROVING AND
AUTHORIZING DELIVERY OF PRELIMINARY AND FINAL
dated March 31, 1987, entered in Judgment OFFICIAL STATEMENT WITH RESPECT TO SAID CERTIFI-
CATES OF PARTICIPATION,APPOINTING A TRUSTEE AND
Book No. 129, page 355, on March 31, 1987. MAKING OTHER FINDINGS AND TAKING CERTAIN OTHER
3. The Public Record is a newspaper Of ACTIONS RELATING THERETO
This Resolution provides for the approval of the issuance by the
general circulation ascertained and established I City of Palm Springs(the"city")is not to exceed 33,000,0oo in
aggregate principal amount of its Taxable Variable Rate
in the City Of Palm Springs in the County of Demand Certificates of Participallom 2002 Series A
Riverside, State Of California, Case No. R1C (Downtown Parking Project)(the"2000 Bonds")far the purpose
of proving financing for the acquisition of 2 acres and conslruc-
358286, Filed June 8, 2001. boo thereon of a Parking structure to be leased by the City to
the CLLy o1 Palm Springs Financing Authority(the"Authority")
4. The notice, of which the annexed is a true and leased by the Authority back to the City This Resolution
Ptinted c0 was published in the newspaper also provides for the approval of a Trust Agreement,a Lease
PY P Per Agreement, a Bond Purchase Agreement and certain other
on the following publication dates to wit: legal documents,and approving and authorizing delivery of a
Jul 9, 2002 Preliminary and Foal Olhcial Statement.If adopted,the City
y Council will find and detarmtne,pursuant to the Resolution,that
it is a public purpose that the City approve the fmancing for the
I certify under penalty of perjury that the Purposes set forth In the Reaclutinn and that mere are signifi-
cant public benefits arising from the taking of such action,
above is true and correct, including,but not limited to,demonstrable savings in effective
Dated at Palm Springs, California this 10th interest rate,bond preparation,bond underwriting and financ-
ing casts associated with the issuance of the 2002 Bonds,as
day of July, 20 contemplated er section these
m the Government Code.
// ✓" Any person interested in these matters Is invitedGovernment
to appear and
be heard with respect Ie the Proposed Resolution.The City of
Palm Sprrough the
accept wntten comments from interested har-
tties Through the conclusion Of court,
public may
behearing.It you cus-
C lenge the prep osetl action in court,you may be limited to rais-
id Reyes ing only those issues you or someone else raised the public
y hearing described in this notice or in written correspondence i O 'ce & Produ i,n anager delivered to the City Council at or prior to the Public hearing.
A copy of the full text of the proposed Resolution is available for
review in the Office of the Illy Clerk of the City of Palm Springs,
0200 E.Tah nub,Canyon Way,Palm Springs,California.
PATRICIA A SANDERS,CITY CLERK
-77j July 9,2002
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
PALM SPRINGS AUTHORIZING THE SALE OF ITS TAXABLE
VARIABLE RATE DEMAND CERTIFICATES OF
PARTICIPATION, 2002 SERIES A (DOWNTOWN PARKING
PROJECT), AUTHORIZING EXECUTION AND DELIVERY BY
THE CITY OF A TRUST AGREEMENT, LEASE AGREEMENT, A
BOND PURCHASE AGREEMENT AND CERTAIN OTHER
LEGAL DOCUMENTS, APPROVING AND AUTHORIZING
DELIVERY OF A PRELIMINARY AND FINAL OFFICIAL
STATEMENT WITH RESPECT TO SAID CERTIFICATES OF
PARTICIPATION, APPOINTING A TRUSTEE AND MAKING
OTHER FINDINGS AND TAKING CERTAIN OTHER ACTIONS
RELATING THERETO
WHEREAS, the City of Palm Springs Financing Authority (the "Authority") is a joint
powers authority duly organized and existing under and pursuant to that certain Joint Exercise
of Powers Agreement dated February 1, 1991 by and between the City of Palm Springs (the
"City") and the Corrununity Redevelopment Agency of the City of Palm Springs (the
"Agency"), and under the provisions of Articles 1 through 4 (commencing with Section 6500) of
Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the "Act"),
and is authorized pursuant to Article 4 of the Act to borrow money for the purpose of, among
others, financing obligations of the City and/or entering into lease arrangements with the City
to finance public improvements; and
WHEREAS, the City proposes at this time to issue its Taxable Variable Rate Demand
Certificates of Participation, 2002 Series A (Downtown Parking Project) in an aggregate
principal amount of not to exceed $8,000,000 (the "Certificates") for the purpose of providing
financing for certain capital public facilities, more particularly described in the hereinafter
defined Lease Agreement (the "Facilities") for lease by the City to the Authority and lease by
the Authority back to the City in accordance with the terms of a Lease Agreement, dated as of
August 1, 2002,by and between the Authority and the City (the "Lease Agreement."); and
WHEREAS, in order to accomplish the financing of the Facilities and the execution,
delivery and sale of the Certificates,it is necessary that the City enter into a Lease Agreement, a
Trust Agreement, and an Assignment Agreement and, relating to the Certificates together with
the execution and delivery of a Reimbursement Agreement, a Confirmation Agreement, which
permit the Certificates to bear interest at variable rates and that certain other actions be taken
and authorized; and
r _
IRV#23074 vl I
WHEREAS, the City Council has conducted a noticed public hearing pursuant to Section
6586.5 of the California Government Code and published notice was given in accordance with
the terms thereof.
NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED BY
THE CITY COUNCIL OF THE CITY OF PALM SPRINGS AS FOLLOWS:
Section 1. Findings and Determinations. Pursuant to the Act, the City Council
hereby finds that the issuance of the Certificates by the Authority will result in savings in
effective interest rates, underwriting costs and bond insurance costs and thereby result in
significant public benefits in accordance with Section 6586 of the Act.
Section 2. Approval of Certificates. The City Council hereby approves of the
issuance of the Certificates by the Authority under and pursuant to the Act provided that the
maximum aggregate principal amount of the Certificates shall not exceed $8,000,000,
Section 3. Approval of Financing Documents. The City Council hereby
approves each of the following documents in substantially the respective forms on file with the
City Clerk, together with such additions thereto and changes therein as the Special Counsel
shall deem necessary, desirable or appropriate, the execution of which by the Mayor,the Mayor
Pro Tern, the City Manager or the Director of Finance and Treasurer shall be conclusive
evidence of the approval of any such additions and changes.
(1) the Trust Agreement relating to the execution and delivery of the
Certificates by and between BNY Western Trust Company (the "Trustee'), the City and
the Authority;
(2) the Lease Agreement relating to the lease of the facilities by the City from
the Authority.
(3) the Assignment Agreement between the Authority and the Trustee.
(4) the Bond Purchase Contract, among the City, the Authority and the Stone
&Youngberg LLC, as Underwriter, and
(5) the Reimbursement Agreement among the City, the Authority and Union
Bank of California, as Credit Bank.
(6) the Confirmation Agreement, among the City, the Authority and
California State Teachers Retirement System, as Confirming Bank,and
(7) the Remarketing Agreement, among the City, the Authority and the
Remarketing Agent defined below.
The Mayor, the Mayor Pro Tem, the City Manager or the Director of Finance and
treasurer is hereby authorized and directed to execute, and the City Clerk is hereby authorized
IRV#23074 v1 -2- FA
I s Cop
and directed to attest and affix the seal of the City to, the final forms of each of the above-
mentioned documents for and in the name and on behalf of the City.
Section 4. Sale of Certificates. The City Council hereby approves the sale of the
Certificates by the Authority to the Underwriter at a variable rate which will not exceed 7%.
The Underwriter's discount shall not exceed 2%.
Section 5. Official Statement. The City Council hereby approves the Preliminary
Official Statement (the "Preliminary Official Statement") and authorizes its distribution in
connection with the sale of the Certificates. The City Manager or Treasurer is authorized to
approve the amendment of the Preliminary Official Statement from time to time, pending
distribution thereof, as shall be required, and in the opinion of the City Manager or Treasurer
and Special Counsel, to cause the Preliminary Official Statement to contain any further
information necessary to accurately describe the Certificates and to certify that the Preliminary
Official Statement as distributed is deemed to be "near final' within the meaning of Rule 15c-2-
12 of the Securities Exchange Commission. The Final Official Statement to consist of the
Preliminary Official Statement and such changes thereto as may be approved by the City
Manager or Treasurer, upon advice of Special Counsel, is hereby approved and the Mayor, the
City Manager or Treasurer or their designee is hereby authorized to execute said Final Official
Statement on behalf of the City. The City Manager or Treasurer or his designee is hereby
authorized to approve and authorize such changes in the Preliminary Official Statement in the
preparation of the Final Official Statement as are approved by Special Counsel to the City. The
distribution of the Preliminary Official Statement in connection with the sale of the Certificates
is hereby approved. The City Council has reviewed and approved the Continuing Disclosure
Certificate the form of which is attached as Appendix C to the Preliminary Official Statement
and the City Manager or the Director of Finance and Treasurer is further authorized to sign the
Continuing Disclosure Certificate on behalf of the City in such form as may be approved by the
officer executing the same.
Section 6. Trustee. BNY Western Trust Company is hereby appointed as
Trustee pursuant to the Trust Agreement, to take any and all action provided therein to be
taken by the Trustee, and is further designated and appointed as paying agent for the
Certificates.
Section 7. Special Counsel. The law firm of Burke, Williams &Sorensen, LLP is
hereby retained as bond counsel on the terms set fortis in the contract of said firm on file with
the City.
Section 8. Remarketing Agent. is hereby appointed as
Remarketing Agent, pursuant to the Trust Agreement, and are authorized to take all action
provided therein to be taken by the Remarketing Agent. The City Manager or Treasurer is
authorized to execute an agreement relating to the services of the Remarketing Agent.
Section 9. Form of Certificates. The form of the Certificates as set forth in the
Trust Agreement is hereby approved, and the Trustee is hereby authorized to execute and
deliver the Certificates in an aggregate principal amount as set forth in the Trust Agreement
and to apply and expend the proceeds thereof as specified in the Trust Agreement.
IRV#23074v1 -3- FA law CWas
Section 10. Requisitions. The Mayor, the City Manager and the Director of
Finance and Treasurer, or any one of them, are hereby authorized and directed to execute one
or more requisitions authorizing the Trustee to pay the costs of delivering the Certificates from
the proceeds of the Certificates pursuant to the Trust Agreement.
Section 11. Other Acts. The Mayor, the City Clerk, the City Manager and the
Finance Director and Treasurer are hereby authorized and directed,jointly and severally, to do
any and all things, to execute and deliver any and all documents,which in consultation with the
staff and special counsel they may deem necessary or advisable in order to consummate the sale
and delivery of the Certificates, including the acquisition of a municipal bond insurance policy,
a reserve fund surety, attaining ratings on the Certificates and appointments of a remarketing
agent or agent for the Certificates or otherwise to effectuate the purposes of this Resolution,
including signing any commitment agreements relating thereto, and any such actions
previously taken by such officers are hereby ratified and confirmed.
Section 12. Effective Date. This Resolution shall take effect upon adoption.
ADOPTED this day of 2002.
AYES:
NOES:
ABSENT:
ATTEST: CITY OF PALM SPRINGS,CALIFORNIA
By:
City Clerk City Manager
REVIEWED &APPROVED
IRV#23074 vl `r I -C
-4-
RESOLUTION NO.
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE CITY
OF PALM SPRINGS FINANCING AUTHORITY AUTHORIZING
THE EXECUTION AND DELIVERY OF A LEASE AGREEMENT,
AN ASSIGNMENT AGREEMENT, A TRUST AGREEMENT, A
BOND PURCHASE AGREEMENT, APPROVING AN OFFICIAL
STATEMENT AND OTHER MATTERS RELATING TO THE
EXECUTION, DELIVERY AND SALE OF THE CITY OF PALM
SPRINGS TAXABLE VARIABLE RATE DEMAND
CERTIFICATES OF PARTICIPATION, 2002 SERIES A
(DOWNTOWN PARKING PROJECT)
WHEREAS, the City of Palm Springs Financing Authority (the "Authority') is a joint
powers authority duly organized and existing under and pursuant to that certain Joint Exercise
of Powers Agreement dated February 1, 1991 by and between the City of Palm Springs (the
"City") and the Community Redevelopment Agency of the City of Palm Springs (the
"Agency"), and under the provisions of Articles 1 through 4 (commencing with Section 6500) of
Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the "Act'),
and is authorized pursuant to Article 4 of the Act to borrow money for the purpose of, among
others, financing outstanding obligations of the City and/or entering into lease arrangements
with the City to finance public improvements; and
WHEREAS, the City proposes at this time to issue its Taxable Variable Rate Demand
Certificates of Participation, 2002 Series A (Downtown Parking Project) in an aggregate
principal amount of not to exceed $8,000,000 (the "Certificates") for the purpose of providing
financing for certain capital public facilities, more particularly described in the hereinafter
defined Lease Agreement (the "Facilities") for lease by the City to the Authority and lease by
the Authority back to the City in accordance with the terms of a Lease Agreement, dated as of
August 1,2002,by and between the Authority and the City (the "Lease Agreement."); and
WHEREAS, in order to accomplish the financing of the Facilities and the execution,
delivery and sale of the Certificates, it is necessary that the Authority enter into a Lease
Agreement, a Trust Agreement, and an Assignment Agreement, relating to the Certificates
together with the execution and delivery of a Reimbursement Agreement and a Confirmation
Agreement,which permit the Certificates to bear interest at variable rates and that certain other
actions be taken and authorized; and
WHEREAS, the Board of Directors of the Authority has determined that the Authority
should enter into the aforementioned agreements and take certain other action in order to assist
the City in accomplishing the aforementioned matters;
IRV#23073 v1 T>
NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED BY
THE BOARD OF DIRECTORS OF THE CITY OF PALM SPRINGS FINANCING AUTHORITY
AS FOLLOWS:
Section 1. Findings and Determinations. Pursuant to the Act, the Board hereby
finds and determines that the execution and delivery of the Certificates will result in savings in
effective interest rates, bond underwriting costs and bond issuance costs and thereby result in
significant public benefits within the contemplation of Section 6586 of the Act.
Section 2. Issuance of Certificates. The Board hereby authorizes the execution
and delivery of the Certificates under and pursuant to the Act, in the maximum aggregate
principal amount not to exceed $8,000,000.
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,
together with such additions thereto and changes therein as Special Counsel shall deem
necessary, desirable or appropriate, the execution of which by the Chairperson the Vice
Chairperson or the Executive Director or the Treasurer shall be conclusive evidence of the
approval of any such additions and changes:
(1) the Trust Agreement relating to the execution and delivery of the
Certificates by and between BNY Western Trust Company (the "Trustee"), the City and
the Authority;
(2) the Lease Agreement relating to the lease of the facilities by the City from
the Authority.
(3) the Assignment Agreement between the Authority and the Trustee.
(4) the Bond Purchase Contract, among the City, the Authority and the Stone
&Youngberg LLC, as Underwriter, and
(5) the Reimbursement Agreement among the City, the Authority and Union
Bank of California, as Credit Bank.
(6) the Confirmation Agreement, among the City, the Authority and
California State Teachers Retirement System, as Confirming Bank, and
(7) the Remarketing Agreement, among the City, the Authority and
as Remarketing Agent.
The Chairperson, the Vice Chairperson, the Executive Director or the Treasurer
are 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. The Board
hereby authorizes the delivery and performance of each of the foregoing documents and
agreements.
IRV#23073 v1 -2- f-A I -P2.
Section 4. Appointment of Trustee. BNY Western Trust Company is hereby
appointed as Trustee pursuant to the Trust Agreement, to take any and all action provided
therein to be taken by the Trustee in regard to any of the Certificates.
Section 5. Certificates. The form of the Certificates as set forth in the Trust
Agreement is hereby approved, and the Trustee is hereby authorized to execute and deliver the
Certificates in an aggregate principal amount which shall not exceed the amount set forth in the
recitals of this Resolution, and to apply and expend the proceeds thereof as specified in the
Trust Agreement. The Chairperson, the Treasurer and the Secretary of the Authority are hereby
authorized and directed to cooperate with the officers of the City in determining the final
aggregate principal amount of the Certificates to be issued based on the determination of said
officers of the amount needed to finance the Facilities.
Section 6. Official Statement and Bond Purchase Agreement. The Preliminary
Official Statement prepared in connection with the Certificates is hereby approved and the
preparation and distribution of Final Official Statement is also approved. The use of the
Preliminary Official Statement and the Final Official Statement in connection with the offering
and sale of the Certificates is also hereby authorized and approved. The form of Bond Purchase
Agreement presented by Stone & Youngberg LLC as underwriter, is hereby approved and the
Chairperson of the Authority or the Executive Director or the Treasurer,is hereby authorized to
execute and deliver said agreement on behalf of the Authority subject to the establishment of
the final terms for the sale of the Certificates by the City, or by the City's staff under authority
delegated to it by the City Council. The Executive Director or the Treasurer of the Authority is
hereby authorized to execute a certificate which shall have the effect of deeming the preliminary
Official Statement "final" for the purposes of Securities and Exchange Rule 15c2-12 under the
Securities and Exchange Act of 1934. The Executive Director or the Treasurer is further
authorized to sign on behalf of the Authority a continuing disclosure certificate with respect to
the financing,in such form as may be approved by Special Counsel.
Section 7. Other Action. The Chairperson, the Executive Director, the Treasurer,
the Secretary and the other officers of the Authority are hereby authorized to take any and all
action which is directed by legal counsel to the Authority with respect to the execution,
acknowledgment and delivery of the aforementioned agreements and the sale of each series of
Certificates which in the opinion of said legal counsel is necessary in order for the
authorizations and directions provided in this Resolution to be carried out.
Section 8. Effective Date. This resolution shall take effect immediately upon
adoption.
r... (4 1 "- 5
IRV#23073 vl _3_
ADOPTED this day of 2002.
AYES:
NOES:
ABSENT:
ATTEST: CITY OF PALM SPRINGS, CALIFORNIA
Secretary Chairman
REVIEWED AND APPROVED AS TO FORM:
Authority Counsel
F A I i �)
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