HomeMy WebLinkAbout1987-05-19; City Council; 8859-6; APPT AUTHORITY DONATION FIN ADVISOR HOSP GROVE Hosp Grove acquisition P&R Raucher, Pierce, Refsnes, Inc. RECYCAL Res 9083 UNDERWRITER Underwriter/financial advisor appointmentMTG. 5/19/87
DEPT. FIN
DEP1
CITY
CITY
APPOINTMENT OF UNDERWRITER/
FINANCIAL ADVISOR.
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u ( CIT"' OF CARLSBAD - AGENDa BILL IO a frAB# assy-6 TITLE: HOSP GROVE ACQUISITION,
RECOMMENDED ACTION:
Adopt Resolution No. 9Q83 appointing Raucher, Pierce, Re
Inc. as the City's underwriter and or financial advisor for
Hosp Grove bond issues.
ITEM EXPLANATION:
The City Council directed the staff to acquire Hosp Grove u
combination of financing tools including bank loans, Bond A
pation Notes (BAN'S) and General Obligation bonds or Certif
of Participation. In moving toward the goal of issuing sho
long term debt one of the first steps is the selection of a
underwriter and bond council.
Eight underwriters were interviewed by the Finance Director
and/or Assistant City Manager during the past two weeks. S recommends the selection of Raucher, Pierce, Refsnes, Inc.
act as underwriter on both the short term BAN and as financj
advisor and/or underwriter on the General Obligation bond 01
COP issue planned for mid 1987-88.
Although all of the underwriters interviewed by the City we1 well qualified, staff recommends Raucher, Pierce, Refsnes fc
this project because of their highly qualified staff, compet
itive fee structure, and knowledge of the market.
The proposed course of action is as follows:
1. Appoint Raucher, Pierce, Refsnes as underwriter for the
Bond Anticipation Note issue and possible Certificate oJ
Participation issue.
2. Issue Bond Anticipation Notes in July 1987 using a nego-
tiated sale approach if the market conditions allow for
fiscally sound issue. If market rates are too high staf
will ask Council to approve an extension of the existing
bank financing until the ultimate G.O. or C.O.P. Bond
issue in late 1987 or early 1988.
3. If COP'S are used, the-City would sell the issue as a
negotiated sale using Raucher, Pierce, Refsnes as the
underwriter. If a G.O. bond issue is approved by voters
in November, Raucher, Pierce, Refsnes would be named as
financial advisor to handle the public sale of the bonds
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FISCAL IMPACT:
The issue of Bond Anticipation Notes and G.O. bonds or
C.O.P.'s will require the payment of fees to the under-
writer and bond council as well as various associated
costs. Underwriter fees for the Bond Anticipation Note
will be $35,000. Underwriting fees for a Certificate
of Participation will be approximately 1.4% of issue
costs, however this is negotiable and will be set at the
time of bond sale by Council action. The financial
advisor fees for a General Obligation bond will be $25,000.
All fees will be paid from proceeds of the issue.
EXHIBITS:
Resolution No. 90tk.3 appointing Raucher, Pierce,
Refsnes to act as the City's underwriter and/or
financial advisor for the Hosp Grove bond issues.
Proposals from Raucher, Pierce, Refsnes:
-for Bond Anticipation Notes and Certificates of
-for General Obligation bonds.
Participation
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RESOLUTION NO. 9083
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CARLSBAD, CALIFORNIA, APPOINTING
RAUCHER, PIERCE REFSNES, INC. TO ACT AS
THE C1TY"S UNDERWRITER AND/OR FINANCIAL
ADVISOR ON THE HOSP GROVE BOND ISSUES.
WHEREAS, the City of Carlsbad intends to issue both s
and long term debt in the process of acquiring Hosp Grove,
WHEREAS, the City requires the services of an underw
for the issue of Bond Anticipation Notes, and
WHEREAS, the City requires either the services of an
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underwriter or financial advisor if the City issues Certifil
of Participation or General Obligation bonds respectively,
WHEREAS, the City intends to issue any Bond Anticipat
Notes and Certificates of Participation as a negotiated sal
the selected underwriter, and intends to issue any General
gation bonds approved by the voters for this acquisition at
sale conducted by the City and its financial advisor, and
WHEREAS, the City has selected Raucher, Pierce, Refsn
I to act as the City's underwriter and/or financial advisor i 1 above transactions,
NOW, THEREFORE, BE IT RESOLVED by the City Council of I
City of Carlsbad as follows:
1. That Raucher, Pierce, Refsnes, Inc. shall act as
writer and/or financial advisor, as necessary, in the above
transactions.
2. That the fees and compensation for said services
be as described in the attached proposals which are incorpo
herein by reference.
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3. That the City Council reserves the right to removc
Raucher, Pierce, Refsnes, Inc. from this project subject or
compensation for expenses through the date of removal.
4. That the City Manager is authorized to execute ani
agreement necessary to confim this appointment subject to t
above terms.
PASSED, APPROVED AND ADOPTED at a regular meeting of t
Council of the City of Carlsbad held the 19th day of May
1987, by the following vote, to wit:
AYES:
NOES: None
ABSENT: None
Council Members Lewis, Kulchin, Pettine, Mamaux and Larso
ATTEST:
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I PROPOSAL TO THE
I CITY OF CARLSBAD
FOR I MANAGING UNDERWRITER
FOR
HOSP GROVE
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RAUSCHER PIERCE REFSNES, INC.
May 6, 1987
Mr. James Elliott
Finance Director
City of Carlsbad
1200 Elm Street
Carlsbad, CA
Re: Proposal to Serve as Managing Underwriter
Dear Jim:
We are pleased to submit our credentials to serve as the managing underwriter to the City
Carlsbad for the purchase of Hosp Grove.
Our interest in thns project has grown since the time we were first asked by the City to submi proposal to serve as financial advisor for a general obligation bond issue. We were very disappoin
to learn that two-thirds of the electorate did not approve the ballot measure, even though over o
half of the electorate did note to acquire the grove.
However, if the City proceeds with a financing without voter approval, the most practical method,
previously discussed with the City, is a lease with Certificates of Participation (COPS). To bridge
gap between the dose of escrow on June 1, 1987 and the receipt of proceeds from the COPs
General Obligation Bonds in the Spring of 1988, we recommend the City issue bond anticipation na
(BANS). These notes do not need to be repaid within the same fiscal year as they are issued
anticipation of longterm financing.
Our proposal includes a list of our references and mentions something unique about each progr;
listed. Our firm places a strong emphasis on creative financing solutions for medium-sized citi
counties and special districts throughout the Southwest. Please call Jeanie Fay or me if you h:
nay questions on this proposal.
Very truly yours,
RAUSCHER PIERlCE REFSNES, INC.
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Virginia / L. Horler -----\
Vice President
VLWplv cc: Jeanie Fay
One California Street, Suite 2630 . San Francisco, California 941 11 . (415) 989-2300
Member New York Stock Exchange, Inc I
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TABLE OF CONTENTS
Section
I I. Project Financing
11. Services Provided
111. Experience
California Financings
COP Financings
Iv. Personnel
V. Proposed Compensation
IC VI. References
VII. Overview of Firm
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I. PROJECT FINANCING
The City needs to have sufficient funds on hand June 1, 1987, to purchase Hosp Grove at i
close of escrow. Depending on the outcome of the ballot item in November when the City will
asking the voters to approve a general obligation bond, the City will issue either general cbligat
bonds or certificates of participation in approximately January or February 1988.
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We recommend that the City sell bond anticipation notes (BANS) in May 1987, in anticipation
the long-term financing to be sold about nine months later as BANS are not fiscal-year borrowin
the City can extend this borrowing beyond the end of the fiscal year.
As we have previously discussed with the City, certificates of participation appear to be
most practical alternative to finance the grove over the long-term.
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Our sources and uses of funds for the certificates of participation, a debt service schedule i
the net cost to the City follow.
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CITY OF CARLSBAD, CALIFORNLA
CERTIFICATES OF PARTICIPATION
Estimated Sources & Uses of Funds
May 5, 1987
Sources:
$7.335.000 Certificate Proceeds
8 Uses:
Project Cost $6,457,000
Reserve Fund(l) 674,28 1
Underwriter’s Discoud2) 102,690
Rounding Factor 2.690
Costs of 1ssuance(3) 100,000
Total Uses: $7,335.000
Average Interest Rate: 7.812%
True Interest Rate: 7.732%
Average Life: 16.5 years 1 Maximum Annual Lease Payment: !§ 674,281
(1) Maximum Annual Debt Service
(2) 1.4% of Par Amount
the time of sale.
(3) 0.40% of Total P&I of refunding bonds
c<work\props\svre€und - 5/6/87 -- page 1-
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C€RTIFICATES OF PARTICIPATIOW
SCHELJUiE ASSUES "A" SCALE - 25 IUR A)cRTlUTIOW
ESTIIWTED GFSS DEBT SERVICE SCHEDULE
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.. - OeliWP/ Data 06/01/87
0s Princiml Cam0 Intereat - Total &k2L
11/01/87 275,046.88 2)5,046.88
05/01/88 129,000.00 5.000 275,046.88 395.046.88 670,093.75
05/01/89 130,000.00 5.250 272,046.88 402,046.88 674,093.75
05/01/90 135,000.00 5.500 268,634.38 43,634.38 672.268.75
-- 05M1/91 lcO.000.00 5.750 264,921.88 404.921.88 669,843.75
05/01/92 150,000.00 6.000 260,896.88 410.8w.88 671,793.75
11 /01/88 272,046.88 tR.046.88
11/01/89 268,634.38 268,634.38
11 /01/90 264,921 .a8 264,921.88
11 / 01 / 91 260,896.88 260,896.88
11 /01/92 256,396.88 256,3%.88
o5/oi/n i6o.om.m 6.~0 256,3%.81) 416,3%.a 6~,793.75
os/oi/% 1To.m.m 6.500 251,3%.a~ UI.~~.~I 672.793.75
ll/Ol/% 265,871 .I 245,871 .I os/oi/ei i8o.ooo.m 6.700 245.an.a a.a7i.aa 6n.m.n
11/01/93 251,3%.88 251,3%.8L).
11 /(11/95 239,851.88 239.841 .88
05/01/9b 190,000.00 6.850 239,841.88 429,841.811 669,683.75
05/01/97 205,O00.00 7.000 233.aC.38 436,334.38 671.668.75
11 /arm u6.159.38 226,159.38
1 l/Ol/FB 218,349.38 218,349.38
05/01/W 235,000.00 7.200 218,349.38 453,349.38 671,658.75
05/01/00 250,000.00 7.350 209,809.38 459,889.38 669,778.75
1 l/(il/% 233.a4.38 233,334.38
05/oins uo,ooo.oo 7.100 226,159.38 446,159.39 6~,318.75
ll/Ill/W 209,889.58 209'889.38
1 l/IH/W 200,mi.a m,mi.ea
os/oi/oi 270,000.00 7.500 m,mi.8s cm,mi.ea 67i,co3.75
11 101 101 190,576.88 190,576.1
05/01/02 &Q,000.W 7.600 190,576.88 480,576.88 671,153.A
11/01/02 179,556.88 179.556.88
11/01/05 167.621.88 167,621.88
05/01/04 335,000.00 7.750 167.421.88 502,621.88 670,243.75
11101/ 04 154,640.63 154,640.63
05/01/05 365,000.00 7.800 154,640.63 519,640.63 671,281.25
11/01/05 140,405.63 140,4O5.63
m/oi/tx 390,000.00 7.~0 160.405.63 su),m..s 6m.aii.z
05/01/07 420,000.00 a.w 125,098.13 5~5,098.13 6m,i%.z
woi/m 310,ooo.oo 7.200 179.556.88 m,s%.a ~9,113.~
11/01/06 125.098.13 125.opd.13
11/01/07 108,298.13 108,298.13
05/01/08 155,WO.00 8.050 108,298.13 M3.298.13 671,596.25
11/01/08 89.w.38 89.584.38
05/01/09 490,000.00 8.125 89,9424.38 579,584.38 b59,wB.i5
11/01/09 7U.078.13 70,078.13
05/01/10 530,OOO.M 8.125 70,078.13 600,076.13 670,156.25
05/01/11 575,000.00 8.125 48.W.88 623,546.88 672,093.75
11/01 / 11 25.187.50 25,187.50
11/01/10 48,516.88 48,546.m
05/01/12 620.OOO.00 8.125 w.ia7.50 6cs.ia7.50 m.3n.00
Totals: 7,335,000.00 9,446.967.50 16,781,%7.50 16,781.967.50
less Accrued Fron 05/01/81: 45,061. 14 45,061.14
Net Cast: 9,401,126.34 16,736,126.36
Values Fran Oated Date:
Average Interest Rate 7.aimw
Bad Years 120,925.00000
Average L i fe 16.48603
Values Fran Delivery Date:
Bad Proceeds: 7,335, ooo. 00
True Interest Rate 7.73163612
Day Basis IS M/W (Icnicipl Bad)
-Prepared Ey-
Ramhrr Piwrr Rcfsnes I=.
CITY OF URLSBAD, e CALIFORNIA 0
1 CERTIFICATES OF PARTICIPATIOW
SCHEUJLE ASSUES "A" =LE - 25 YEAR AIICRTIZATIOI SCHELWLE
ESTIMTEI) NET LEAS PAWENT SCHEWLE
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Delivery Date 06/01/87
WMSS LESS: NET
DEBT SERVICE REKRM NWD DEBT SERVICE
EARNINGS
Date
(1) (2)
07/01 /88 624.252.61 47,?7a.43 576.474. ia
07/01/89 674.093.75 52,121.92 621,971.83
07/01/90 672.268.75 52,121.52 620.146.83 -- 07/01/91 669,843.75 52,121 -92 617,721.83
07/01/Td 671,793.75 52,121.92 619,671.83
07/01/9?i 672.793.75 52,121.92 620,671.83
07/01 /% 672,793.75 52.121.92 620,671.83
07/01/% 671,743.75 52,121.92 619,621.83
07/01 /9E, 669,683.75 52'121.92 61 7,561.83
07/01/97 671.668.75 52.121.92 619,546.83
07/01/911 6~,3ia.~ 52,121.92 620,1%.83
07/01/99 671,698.75 52.121.92 619,576.83
07/01/0(3 669,?7a.75 52.121.92 617,656.83
07/01/02 671,153.75 52,121.92 619,031.83
07/01/03 669,113.75 52,121 -92 616,991.83
07/01/01 67l,403.75 52,121.92 619,2ai .a
07/01/06 670.243 .E 52,121.92 6ia,121.83
07/01/05 674,281.25 52,121.92 622.159.33
07/01/06 670.81 1-25 52,121.92 61a.m.33
07/01 107 670,196.25 52,121 -92 61 a ,074.33
07/01 loa 671,596-25 52,121 -92 619,474.33
07/01/09 669.w.75 52,121.92 617,846.83
07/01/11 672,093.75 52,121.92 619,971.83
07/01/12 670,375.00 726,402.92 -56,027.92
07/01/10 670.156.25 52,121.92 6ia.o~ .33
Totals : 16,m.i26.3 1,972.w.51 14,763,14o.a5
1 57.335 HziLIw a 7.81%
2 wxw ANNUAL DEBT SERVICE -INVESTED a TRUE INTEREST RATE OF 7.73~
-Prepared By-
Rauscher Pierce Refsros, 1%.
h California Street - Suite 2630
Sen Francisco, California 94111 I May 5, 1987
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1 I 1 II. SERVICES PROVIDED
An overview of the services covered by the management fee is provided below. Our goal is assist our client to finance the project at the lowest possible cost. The tasks listed below
typical, but may not be all inclusive as each financing requires slightly different senrices.
o Review, analyze and evaluate available financial, legal and other relevant information ; data which may have a bearing on a program to finance the Project.
o Confer and consult with staff, Bond Counsel, architects, engineers, appraisers and ot
involved consultants regarding costs, revenue sources, cash flows, time frames, advant;
and disadvantages, restraints and other applicable factors leading to selection of the t
of financing procedure to be followed and the type of securities to be issued (hereina I “Securities”).
o Arrange and attend meetings, prepare time schedules, and monitor compliance and progi
toward efficient and timely accomplishment of the financing.
Assist City Attorney and Bond Counsel in the preparation of the resolution of issuance i other legal documents related to issuance of the Securities. o
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o As required, confer with Moody’s Investors Services, Inc. and/or Standard & Po( Corporation with regard to the assignment(s) of credit ratings on the Securities, and
connection therewith, present to these rating agencies all data and information to peri
them to evaluate and rate the Securities prior to their offering.
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o Upon approval of final financing details, prepare the text and other material, print :
distribute preliminary and final official statements in connection with marketing 1
Securities.
Recommend the terms and conditions under which the Securities are to be sold and issu
including time of sale, maturity schedule, call and redemption features, potential cre
enhancement, application of proceeds obtained from sale of the Securities, flow of fun
selection of the bank trustee or fiscal agent, and other pertinent details.
Promote investor awareness as part of pre-marketing activity.
Keep the issuer fully up-to-date on market conditions pertinent interest rates, anticipal
rate movements, and level of marketing volume.
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o Upon final approval of financing details, and upon direction to do so, work with t
underwriting group to price the Securities to obtain the lowest possible interest c(
consistent with market conditions, maturity schedule and rating of the issue.
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RAUSCHER PIERCE REFSNES, INC.
CALIFORNIA CERTIFICATES OF PARTICIPATION
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Issue Sale Date Amount Rc
Modesto Irrigation District October 1986 $161,500,000 Co-M
City of Fremont Park Facilities Corporation* August 1986 12,'705,000 Sole
City of Santa Ana August 1986 13,990,000 FA
City of Santa Monica* August 1986 12,965,000 Sole I
city of Cupertino* July 1986 9,800,000 Sole
City of Hercules (Refunding)* June 1986 10,905,000 Sole '
Redwood City Public Facilities and infrastructure
Authority (Lease Revenue Bonds) June 1986 16,140,000 Sole P
Improvement Board (Lease Revenue Bonds)* June 1986 13,970,000 Sole E
City of San Luis Obispo Capital
City of San Diego (Refunding) May 1986 63,330,000 FA
Fremont Unified School District April 1986 8,225,000 Sole h
city of Visalia* December 1985 28,4.00,000 CO-M~ I County of Alameda December 1985 133,300,000 FA
Elsinore Union High School District November 1985 2,195,000 Sole h
City of Irvine Public Facilities and IFfrastructure
Authority (Lease Revenue Bonds) November 1985 90,400,000 Sole hi
City of West Covina Redevelopment Agency November 1985 75,605,000 Sole h
City of Fremont October 1985 9,940,000 Sole WI
Coachella Valley Unified School District September 1985 2,330,000 Sole M
City of Berkeley* August 1985 26,650,000 Sole M
Sole M City of Campbell July 1985 10,650,000
Sole M City of Hercules* March 1985 9,090,000
Sole M Monrovia Redevelopment Agency December 1984 10,000,000
County of Sacramento October 1984 62,900,000 FA
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Issue Sale Date Amount Rol
Sole fi
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city of West Covina* August 1984 20,430,000
City of San Mateo Redevelopment Agency July 1984 8,100,000 FA
City of Santa Maria* May 1984 39,705,000 FA
Contra Costa County April 1984 4,615,000 Sole B
Contra Costa County April 1984 1,810,000 CO-M~
City of Santa Maria (Marian Medical Center) October 1983 11,500,000 FA
City of Imine Public Facilities Corporation October 1983 7,270,000 Sole Ib
Monrovia Redevelopment Agency
(Huntington Oaks Shopping Center) September 1983 10,000,000 Sole hi
City of Santa Ana June 1983 7,690,000 Sole Ib
City of Burlingame April 1983 3,500,000 FA
City of Hayward March 1983 2,075,000 FA
Redevelopment Agency of the City of Oakland September 1982 43,500,000 FA
La Habra Civic Improvement Authority October 1982 2,450,000 FA 1 City of Los Angeles November 1981 3,460,000 FA
In Progress:
City of Pasadena* 24,000,000 Sole M
City of Oxnard* 50,000,000 Co-MgI
* Asset Transfer Program.
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RAUSCHER PIERCE REFSNES, INC.'S
CALIFORNIA h"ICIPAL FINANCING EXPERIENCE
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m m Mount Sale Date J
Tax and Revenue Anticipation Notes $ 3,000,000 12109186 s
Grossmont Union High School District Tax and Revenue Anticipation Notes 4,240,000 12/09/86 s
Carson Redevelopment Agency Tax Allocation Bonds 5,82QoOU 10/06/86 F
Carson Redevelopment Agency Tax Allocation Bonds 3J30,000 10mm E
City of Santa Ana Redevelopment Agency Certificates of Participation 13990,000 m/86 I
CertiEcates of Participation lzgss,oOO 8/19/86 z City of Santa Monica
Northern California Power Authority Refunding Hydro-Electric Revenue Bonds 356J30,OoO 8/12/86 t
Fremont Park FaciIities Corporation Certificates of Participation 1'2,705,WU) 81wv86 <
City of Ukiah Electric Revenue Bonds 2m,m 8/06/86 F
Northern California Power Authority Refunding HydreElectric Revenue Bonds zaS,OXl,OOO 8/05/86 c
Santa CIara County Traffic Authority Limited Tax Bonds #lo,OOO,OoO 7/22/86 F
City of Cupertino Certificates of Participation 9,800,oOO 7/16/86 S
&st Bay Municipal Utility District Water Revenue Bonds, Series D 1Oo,oO0,000 7rnM F
State Public Works Board of California Energy Efficient Revenue Bonds 66,455.W 6/26/86 C
&g~ Luis Obispo Capital Impmvement Board Capital Improvement/Lease Revenue Urn,oOO 6/24/86 S
Redwood City Public Facility In€rastructure Capital Irnpmvement/Lease Revenue 16,140.W m/86 S
Kings River Conservation District/Pine Flat Hydroelectric Revenue Refunding 4S0,000,@JO 6/17/86 F
Fremont Unified School District General Obligation 670,QOO 6/17/86 F
Clark County, Nevada General Obligation Reending Bonds 38,240,W 6/12(86 S
County of FresM, Tax and Revenue Anticipation Notes 65,000,W 6/10/86 C
County of Sacramento Tax and Revenue Anticipation Notes 120,000,000 6/10186 S
City of Hercules Rehding Certificates of Participation , 10,905,OoD 6/03/86 S
City of Ukiah Electric Revenue Refunding Bonds Zl5Ss,~ 5mm F
City of San Diego Refunding Cert. of Participation 63,330,OoD 5/08/86 F
Sacramento Municipal Utility District Electric Revenue Bonds 150,000,000 4n9m F
East Bay Municipal Utility District General Obligation u500,m 4LW86 F
East Bay Municipal Utility District Wastewater Revenue Refunding Bonds 25,280,oOo 4/03/86 F
Fremont Unified School District Certificates of Participation a,m,ooo 4/03/86 S
East Bay Municipal Utility District Water Revenue Refunding Bonds 150,365,WJ 313 1/86 F
City of Redwood City Seaport Center Improvement Bonds 11,133530 12/19/85 sc
Kings River Conservation DistricWDinkey Creek Eiectric Revenue Bonds 4SO,OOO,MlD 12/18/85 E
Ciry of San Jose Airport Revenue 85,960,m 12/17/85 F.
City of Visalia Certificates of Participation 28,400,000 1Y11185 CI
Santee School District Tax and Revenue Anticipation Notes 2,000,000
California Higher Education Loan Authority Student Loan Revenue Bonds 2oo,OOO,000 12/05/85 sc
San Diego Unified School District Tax and Revenue Anticipation Notes 36,000,000 1 lm85 sc
Grcsmont Union High School District Tax and Revenue Anticipation Notes 6,000,000 iin7/as sc
Elsinore Union High School District Certificates of Participation 2,195,000 iinzas sc
City of Hercules, Alfred Nobel Assessment Dist. Improvement Bonds 13,694,469 11m/85 sc
santec School District
Kin@ River Conservation DistricuDinkey Creek Hydroelectric Revenue Bonds 10/10/86 F 450,000,000
City of San Diego(La Jolla del Sol Apartments) Multi-law Revenue Bonds 20,999,737 12/17/85 SI
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Redevelopment Agency of City of Watsonville Tax Allocation Bonds 2,175,000 12/1om FA
County of Alameda Santa Rita Jail Project Floating RateFid Rate Bonds 133,300,000 12/04/85 FA
iuii/as
West Cwina Redevelopment Agency Floating Rate Parking Structure Bonds 75,605,000 12/17/85 Sf
Richmond Rcdevelopmcnt Agency Tax Allocation and Refunding Bonds 11530,000 iiiiwa5 FI
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IrVine Public Facilities & Infrmcnvs Lease Revenue BonWariable Rate so,a.ocm, 11/14/85 sc
Sacramento Municipal utility Dwct aectric Revenuo Refunding Bonds 491,495,ooc) 1uW/85 FA
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I City of San Pablo Tax and Revenue Anticipation Notes 1,150,000 11104085 sc
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I Via Unified School District Education Facility WO,ooO 7/16/85 S
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1 Oak Park Unified %hod District General Obligation 1,100,000 2/19/85 F I Richmond Unified School District Tax and Revenue Anticipation Notes 9,oO0,00(1~ 12/13/85 sc
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I Citydviia Sewer Revenue Bonds 6,845,ooc1 10/16/84 sc
1 Vista Unified %hod District Tax and Revenue Anticipation Notes 3500,oao 10m st
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F~CSIIO Unilied School District Tax and Revenue Anticipation Notes 11500,ooc) 10/73/86 sc
City of Fremont Certificates of Participation 9,940,cmf.D 10/17/85 sc
City of Watsomrille Sewer Revenue Bonds 5,oO0,~ 9/10/85 d
InglmoOa Redevelopment Agency Tax Allocation Bonds 6,065,000 9/Q5/85 F
Coachella Valley Umed School District Certificates of Participation ux,m 9/05/85 d
City of Berkeley Certificates of Participation 26,6SO,ooO 8/14/85 SI
city of campbelt Certificates of Participation 10,m.m 7/16/85 J
County of Sacramento Tax and Revenue Anticipation Notes 100,oOO,ooO 6/2m F
County of Fresno Tax and Revenue Anticipation Notes aO,ooO,oOc, 6/18/85 C
Sacramento Municipal Utility District Refunding Bonds 191~5,aoo 6/13/85 F
City of Richmond Tax and Revenue Anticipation Notes 9>ooO,ooO 6/10/85 S
City of hg Beach Marina Revenue Refunding Bonds 38,315,oaCb 4/15/85 S
City of Hercules Redevelopment Agency Certificates of Participation 9,W.oOCr 310m S
Smta Ana Community Redevelopment Agency Tax Allocation Bonds ~.ooO,ooO mm.5 F.
Grossmont Union High School District Tax and Revenue Anticipation Notes 95~,~ 12/11/84 sc
San Diego Unified School District Tax and Revenue Anticipation Notes U,OOO,~ 1mw sc
City of Manteca Sewer Revenue Bonds 3YO,ooC, 10m/84 sc city of perris Multi-family Housing Revenue . 6,400,m 11/14/84 SI
San Jme-Santa Clara Water Financing Auth. Revenue Bonds, Series B 20,470,000 lOl24I84 E
Union Sanitary District Sewer Revenue Bonds 6,100,000 10/17/84 E
City of San Jose Airport Revenue Bonds 24,a,aM 10/16/84 SC
California High Education Loan Authority Student Loan Revenue Bonds lW,ooO,OOO 10/16/84 SC
City of Alameda Tax and Revenue Anticipation Notes 5,ooO,(xlo 1010m s
City of San Pablo Tax and Revenue Anticipation Notes 1,200,000 10/01/84 s
City of Redwood City Tax and Revenue Anticipation Notes 3,800,000 9/17/84 S
City of Escondido Multi-farmty Housing Revenue Bonds 20,430,000 m/84 S
City of Palo Alto Parking Garage Assessment Bonds 5,430,000 8/07/84 F
San Diego County Capital Assct Leasing Corp. Leasehold Revenue Bonds 11,825,000 8/06/84 C
Suisun City Multi-family Housing Revenue 7,750,000 7mw S
Rainbow Municipal Water District General Obligation Bonds 3,255,000 5L221/84 F
Santa Clara VaUey Water District Water Revenue Bonds 33,000,000 4124184 F
Cohtra Costa County Public Facilities Cop. Refunding certificates of Participation 6,425,000 4/05/84 Ct
Shasta County Public Facilities Corp. Revenue Bonds 7,000,000 m84 Fi
City of Hercules Improvement Assessment Dist. Water Treatment Plant Improvement Bonds 4,863,506 1/11/84 sc
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IV. PERSONNEL I
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Rauscher Pierce Refsnes, Inc. employs the "team" approach to provide our clients access to
full range of investment banking talent available from the firm. If selected, the individuals Ii
below would work closely with City staff in developing a financing program to meet your un
needs. Each member assigned to the financing has extensive experience in general governme
finance and issues of certificates of participation. All team members are based in San Francisco
would be readily accessible and responsive to your staff. The phone number for our public financ
(415) 989-2300. I PUBLIC FINANCE
Years of
Personnel to Industry
Location be Assimed ExDerience Resuonsibility
San Francisco James W. Martling 10 Project Advisor I Senior Vice President
I Vice President
San Francisco Virginia L. Horler 4 Assistant Project Manager
San Francisco Grant M. Hamill 3 Project Advisor Assistant Vice President
San Francisco Jeanie S. Fay 2 Assistant Project Manager
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Senior Associate Technical Analyst
SALES AND TRADING
Years of Personnel to Industry
Location be Assigned ExDerience Responsibility
San Francisco Steven Baker 19 Western Sales Manager Vice President
San Francisco Joseph L. Refsnes, Jr. 10 Program Reinvestment Services
Vice President
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VIRGINIA L. HORLER
Vice President I
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Virginia Horler joined Rauscher Pierce Refsnes, Inc. in 1983 after serving as Deputy Treasi
and Budget Analyst for the City of Richmond, California for 12 years, and after authorizing the a
to Public Debt Financinv in California At the City, Mrs. Horler was responsible for (
management and the City's short-term cash flow financing programs.
Since joining Rauscher Pierce Refsnes, Inc., Mrs. Horler has acted as principal investn
banker/financial advisor to the cities of Imine, San Mateo, Hercules, Alameda San Pablo, Redw
City, Richmond, Campbell, Fremont, Santa Ana, and San Luis Obispo, the Richmond Unified Scl
District and the Santa Clara County Traffic Authority. She specializes in short-term cash flow p~
facility and infrastructure financings and has acted as project manager on tax allocation
refunding bonds for the Richmond, Carson and Long Beach redevelopment agencies.
Mrs. Horler has assisted her clients in the issuance of certificates of participation, lease reve
bonds, tax allocation bonds, 1915 Act Improvement Bonds, limited tax revenue bonds, refunding bo1
variable rate and variable mode bonds, and tax and revenue anticipation notes totalling in excess
$500 million. She recently authored an article entitled "A Primer on Short-Term Borrowing" wl:
appeared in the December 1985 issue of Western City, and an article entitled "The Credit Ra
Agency: Roles and Requirements", which appeared in the January 1986 California Association I Local Economic Develoument Bulletin.
Mrs. Horler received her B.A. and M.B.A. with honors from Saint Mary's College and i
member of the California Municipal Treasurers Association, the Government Finance Offit
Association and the San Francisco Municipal Forum.
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JEANIE FAY I Senior Associate
Miss Fay joined the firm in May 1985, after working in the real estate industry in syndicat
and project finance. Prior to that she worked for Oppenheimer & Co., Inc. in both Los Angeles Houston as an S.E.C. Registered Representative and Research Analyst.
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Since joining the firm, Miss Fay has assisted in the structuring of various types of pi
financings including over $80,000,000 in assessment district bonds and certificate of particip:
issues for several cities including Berkeley, Cupertino, Hercules and Santa Monica. In addition
has structured over $200,000,000 in advance refundings and is currently working with the CiQ
Santa Monica on the advance refunding of their 1982 Tax Allocation Bonds. Miss Fay assisted in
structuring of the Santa Clara County Traffic Authority’s recent $200,000,000 Sales Tax Revenue E
issue and serves as a member of the Financial Advisory team for the Sacramento Municipal U
District and the East Bay Municipal Utility District. Projects Miss Fay is currently working
include the refunding of an assessment district bond issue and several transactions involving
transfer of City-owned properties to qualified non-profit entities for the financing of various ca
improvements.
Miss Fay received her B.A. from Stanford University and her M.B.A. from Northwes
University.
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1 Financial Analyst SUZANNE M. SCHMIDT
Suzanne Schmidt joined Rauscher Pierce Refsnes, Inc. in July 1986 after working as a Markc
At IBM, Representative Assistant in the Information Systems Group of the IBM Corporation.
developed expertise in the use of personal and mainframe computers for financial applications.
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I Currently Ms. Schmidt is preparing computer analyses for various municipal clients util,
Rauscher Pierce Refsnes, Inc.’s innovative Asset Transfer Program. Ms. Schmidt also assists
professional staff in structuring a variety of other types of public financings including certificate
participation and advance refundings. In addition, Ms. Schmidt has designed computer-based firm 1 tools and casMow projects.
I Ms. Schmidt received her B.S. from the Business School of Administration at the Universit
California, Berkeley with an emphasis in Finance and Marketing.
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I Vice President
STEVEN E. BAKER
Mr. Baker joined Rauscher Pierce Refsnes, Inc. in 1985 as the 'West Coast Manage
Municipal Sales Operations. After graduating from the University of California at Santa Barbara
a B.S. Degree in Economics, Mr. Baker spent eighteen years working for Dean Witter Reyi
Municipals in such capacities as Municipal Liaison, Municipal Bond Trader, and Vice Preside1 Institutional Sales - Fixed Income. Mr. Baker handles both institutional and retail placemen
municipal products on the West Coast.
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B Vice President
JOSEPH L. REFSNES, JR.
Mr. Refsnes joined Rauscher Pierce Refsnes, Inc. after attending Arizona State University
Northern Arizona University where he majored in Business Administration with an emphas
Accounting. Prior to joining the institutional government sales office of Kauscher Pierce Re
Inc. in Dallas, Texas in 1980, Mr. Refsnes worked in the Public Finance Department of Rau
Pierce Refsnes, Inc. in Phoenix, Arizona for four years.
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Mr. Refsnes opened the San Francisco government sales office in 1982 and has since partici
in numerous public finance projects including the cities of Hercules, Berkeley and Fremont in the I Francisco Bay Area.
Mr. Refsnes works primarily with banks, savings and loans, cities and counties.
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V. PROPOSED COMPENSATION
The fee for Underwriting the bond anticipation notes is $Z#$@8 plus Underwriter’s Counsc
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required. &Ls,uoo 3Q-r v<q;wiA l-kb-/#y- %-/c3/8i7
Estimated Fixed-Rate Fee Structure for Certificate of Partickation’
($ per 1,000)
Management $3.00
menses 3.00
UnderwritingJRisk .so
Sellinflakedown - 7.50 I Total $14.00
I * Assumes 25 principal maturities and A/A+ Rating
The actual compensation for the underwriting group is negotiated at the time of financing
the largest component, takedown, is a function of market conditions at the time of sale.
following is a brief description of the components that add up to the underwriter’s discount. 1
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1 ManaPement Fee
The management fee consists of the following services:
1. , After thorough analysis of financing alternatives, develop a program structure and plar
financing that best meets the needs of the issuer.
Coordinate all members of the financing team to prepare the issue for pricing.
Review economic and market information with the issuer and recommend the timing of
financing to capture the market in its strongest possible phase, as well as reducing the I
of poor investor response in a weaker market.
2.
3.
4. Develop and implement innovative and proven financing instruments and certificate matur
that are appropriate to market conditions and investor preferences.
The most significant factors to be considered in the determination of management fees are
experience and judgment demonstrated by your investment banker in providing these services and
appropriateness of advice to the overall objectives. The management fees are the only fees that
be arbitrarily allocated. The other fees included in compensation are based on market conditions
sales performance.
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Emenses
Expenses represent the underwriter’s out-of-pocket disbursements incurred during a financ
Underwriter’s counsel is the major component in this category. Other expenses include clearance
(normally $0.50 per bond to cover “back-office expenses incurred in the physical distribution of
securities) regulatory fees such as CDAC, PSA, and MSRB fees and advertising. The amoun
expenses vary widely with the size of the bond issue because the absolute amount of the expl
component is relatively independent of market conditions and issue size.
Underwriting Fee
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The underwriting fee is the fee paid to the underwriters for their commitment of capital to
new issue. The amount of this fee is dependent upon the strength of the market at the timl
issuance. For example, in weaker markets, the fee would necessarily increase in recognition of
greater risk that the underwriters may need to take bonds into their portfolio without invc
interest, thus potentially sustaining substantial losses. In stronger markets where the underwr
team has minimal market risk, this portion of the fee can be reduced. 1 Takedown
The takedown component of the underwriter’s discount represents the sales commissions and I
concessions paid to the members of the sales group. Underwriters allocate bonds accordini
generally accepted industry practices which take into account priorities and efficient execution.
Additional Issuance Costs
Additional issuance costs would also be payable from the bond issue. These costs usually inc
bond counsel fees and expenses, engineering consultant fees and expenses, bond printing fees, r;
agency fees, and initial paying agent fees. 1
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$13,970,000 City of San Luis Obispo
Capital Improvement Board
Lease Revenue Bonds
(Parking Projects)
City of San Luis Obispo
P.O. Box 321
San Luis Obispo, California 93406
Mrs. Roberta Goddard
Finance DirectorEreasurer
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(805) 549-7130
4. Jeanie Fay, Senior Associate, served as assistant project director and sole managing undenvr
in August 1986, This financing combined 1913 Act assessment proceedings and our A:
Transfer ProgramSm into a certificate of participation issue.
$12,965,000 Certificates of Participation
City of Santa Monica Parking Improvements
City of Santa Monica
1685 Main Street
Santa Monica, California 90401
Mr. Charles Dennis
City ControllerDirector of Finance
(213) 488-8281
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AN OVERVIEW OF RAUSCHER PIERCE REFSNES, INC. 1
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Rauscher Pierce Refsnes, Inc. was founded in 1931 as an underwriter and distributor
corporate and municipal securities. Today, Rauscher Pierce Refsnes is one of the largest regic
investment banking firms in the United States with a complement of over ‘1,100 men and wor providing professional services in all areas of Public, Mortgage and Corporate Finance. The tl
assets for the firm as of December 31, 1986 were over $483 million. The firm maintains its corpoi
headquarters in Dallas, Texas with regional headquarters in Phoenix, Arizona and San Franci
California. The firm has 31 offices located in California, Arizona, Oklahoma, Illinois, Color:
Nevada, New Mexico, New York and Texas.
On January 1, 1982, Rauscher Pierce Refsnes became a wholly-owned subsidiary of the holc
company, Inter-Regional Financial Group, Inc. Rauscher Pierce Refsnes and Din Bosworth, a regic
investment banking firm headquartered in Minneapolis, Minnesota, are the piincipal assets of In
Regional Financial Group, Inc.
PUBLIC FINANCE
Within its region, Rauscher Pierce Refsnes is a major force in Public Finance. Over the pas1
years, the Firm has provided investment banking services to cities, counties, municipal ut
districts, hospital districts, school districts, universities, state authorities and many other munic
entities throughout the West and Southwest for virtually every type of financing. The Public Fina
Division of the Firm’s Fixed Income Banking Department is currently comprised of 46 professio
with backgrounds in government, law, finance, health care and management consulting. The deptl:
our personnel and their experience in completing complex financing programs for clients
unsurpassed.
Rauscher Pierce Refsnes serves its clients as either a Financial Advisor to public entities
choose to solicit competitive bids or as a Managing Underwriter for the negotiated sale of munic
securities.
FINANCIAL ADVISOR
During 1986, Rauscher Pierce Refsnes served as the Financial Advisor on over 100 issues
public entities in the West and Southwest in the sale of over $2.4 billion in tax-exempt securi
The Firm currently serves as Financial Advisor to such major municipal issuers as the Arizona PC
Authority; the Central Arizona Water Conservation District; Dallas County, Texas; the Sacramc
Municipal Utility District and the East Bay Municipal Utility District. I
MANAGING UNDERWRITER
In 1986 Rauscher Pierce Refsnes confirmed its position as one of the nation’s top munic
finance firms. During 1986, Rauscher Pierce Refsnes:
o Senior Managed a $500 million Certificates of Participation issue for the Arizona Munic
Financing Program. The issue is the largest Certificates of Participation financing I sold.
o Ranked first in underwriting tax-exempt issues for Education in the full credit to
manager and bonus credit to lead manager categories, as compiled by Securities I
Corporation. The Firm Senior Managed eight Education issues totalling $910 million.
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o Ranked 16th nationally in the category of full credit to lead manager for Long-Tc
The f Negotiated Tax-Exempt Issues, as compiled by the Securities Data Corporation.
lead managed 46 negotiated issues totalling $1,956,000,000.
The Firm was a Lead or Co-Managing Underwriter for 196 issues totalling $7,392,000,000
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SPECIALIZED FOCUS
Rauscher Pierce Refsnes is uniquely structured to offer our clients services and benefits
available at the national firms or the small local firms. We are able to furnish our clic sophisticated products, services and support systems while still providing the high level of perst
attention that leads to financial success and satisfaction.
In order to cope with the complex problems brought about by the large capital demands of s
and local governments, Rauscher Pierce Refsnes has developed and implemented a number of financ
techniques and procedures which have proven beneficial to our clients. Within the scope of
services, we have developed the following financing programs:
Revenue and general obligation bonds. o
o Current and advance refundings. o Health service revenue financings.
o Industrial development financings.
o Non-profit corporation financings.
o o Lease and lease-purchase programs.
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Rauscher Pierce Refsnes established its San Francisco Fixed Income Banking Office on Augus
1982, through the acquisition of the assets of Stone & Youngberg Municipal Financing Consult2
Inc.
Both fixed and variable rate certificates of participation.
Grant, tax and revenue anticipation notes.
Single- and multi-family mortgage revenue financing programs.
MUNICIPAL RESEARCH GROUP
The Rauscher Pierce Refsnes Municipal Research Group consists of eight professionals.
Municipal Research Group’s efforts complement the Firm’s Public Finance, Sales and Trading effi
The Group’s analytical services are a valuable resource in the structuring and marketing of new i
securities. Periodic research reports on our clients are prepared and distributed on their behal
the rating services and throughout the institutional and retail investment community.
COMPUTER SERVICES GROUP
Rauscher Pierce Refsnes’s Computer Services Group provides daily analytical support for
Fixed Income Banking Department. The Group is continually developing and implemer
sophisticated computer programs to analyze and determine the most efficient financing plans for
public and corporate clients. These programs are designed to evaluate the advantages
disadvantages of alternative financing mechanisms that may be used to fund a project, to pe
adjustments in financing plans that may be advisable due to rapidly changing conditions in the ca
markets, to improve investment returns, to determine optimal debt financing strategies, and
minimize interest cost. Rauscher Pierce Refsnes’s sophisticated computer software is linkec
terminals located in our four fixed income banking centers, which gives us a remarkable too
solving specific on-site financing problems.
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Rauscher Pierce Refsnes's in-house computer system is comprised of a Hewlett Packard 30
Series 40 with 1 megabyte of memory, disc storage capacity of 400 megabytes of memory, a 1600 E
magnetic tape unit. This system is dedicated as a financial analysis tool.
Over the past five years we have developed our own financial models for uses such as sin1
family housing cash flows, student loan cash flows, advance refundings and other bond structui
and modeling programs. These models have been praised by Moody's Investors Service, Inc., Stand
& Poor's Corporation, Municipal Bond Insurance Association, and Financial Guaranty Insura
Company for schedule detail and readability and have become standards in the industry.
Our analytic strength is bolstered by our in-house capability to create new models and enha
All of our programs are written in BASIC, wh
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old models within a very short period of time.
allows us to develop and change programs in a shorter time period than with Fortran or COBOL.
have three full-time programmers/operators to modify and create new financing models. I
MARKETING CAPAl3ILI"Y '
Since its inception in the 19303, Rauscher Pierce Refsnes has been a major factor
underwriting state and local government obligations for Western and Southwestern issuers, Toc
Rauscher Pierce Refsnes is clearly the leading investment banking firm in the region for manaj negotiated tax-exempt issues.
Our distribution capabilities are among the strongest in the country in both the institutional i
retail markets. We provide daily coverage of all of the major institutional buyers of tax-exer
securities. In addition, we maintain one of the most aggressive and productive retail sales forces
the industry, a resource that is often of vital importance to municipal issuers.
Selected negotiated underwritings which Rauscher Pierce Refsnes has recently Senior Manai
include the following issues:
o $500,000,000 Arizona Municipal Financing Program, 1986 Adjusted Rate Certificates
Participation.
o $231,500,000 Arizona Health Facilities Authority, Rate Adjustable Mode Bonds (Arizc
Voluntary Federation Pooled Loan Program) Series 1985 A & B.
$205,275,000 City of Phoenix, Arizona, General Obligation Refunding Bonds, Series 1986.
$110,000,000 West Texas Higher Education Authority, Inc., Rate Adjustable Mode Bon
Series 1986.
$93,290,000 Texas School District Finance Corporation Program, Certificates of Participat
Series 1986.
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The following are selected negotiated underwritings on which Rauscher Pierce Refsnes 1
recently served as a Co-Manager:
o $1,153,040,000 Grand River Dam Authority (Oklahoma), Revenue Bonds, Refunding Ser
1987.
$606,555,000 Northern California Power Agency Geothermal Project #3, Revenue Bonds 1s
Refunding Series A.
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o $306,130,000 Snohomish County PUD #1 (Washington), Generating System Revel
$545,145,000 Austin, Texas, Combined Utility Systems Revenue Refunding, Series 1986.
I Refunding, Series 1986A.
I Series 1986.
o $222,040,000 Board of Regents, University of Texas, General System Revenue Refunc
CALIFORNIA MARKETING CAPABILITY
Selected California negotiated underwritings which Rauscher Pierce Refsnes has recently Sei
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Managed include the following financings:
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o $90,400,000 Imine Public Facilities and Infrastructure Authority Lease Revenue Bo1
$125,000,000 California Higher Education Loan Authority Revenue Bonds, Series 1987.
$120,000,000 County of Sacramento 1986/87 Tax and Revenue Anticipation Notes.
Series 1985, (Capital Improvement Projects).
$75,605,000 Redevelopment Agency, City of West Covina, California, Parking Authority
the City of West Covina, California 1985 Series A, B, C & D.
$26,650,000 City of San Diego, California Multifamily Housing Revenue Bonds, Series 198
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INSTITUTIONAL SALES DEPARTMENT
Rauscher Pierce Refsnes’s powerful institutional distribution capability is one of our
competitive advantages. Rauscher Pierce Refsnes has a staff of 46 tax-exempt sales professioi
located in Dallas, Texas; Phoenix, Arizona; and San Francisco, California. These professionals pror
the most effective institutional coverage in the West and Southwest.
Rauscher Pierce Refsnes’s institutional sales staff enjoys constant communication with
nation’s largest major closed- and open-end bond funds, mutual savings banks, investment counsel
and major life and casualty insurance companies. In addition, Rauscher Pierce Refsnes’s coverage
the institutional market is focused on the trust and portfolio departments of the nation’s top 1,
commercial banks. The firm also covers the “mini“ institutions which, due to their size or locati
do not receive the same attention from our competitors. In addition,
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We have four institutional sales professionals in San Francisco.
The Firm’s Institutional Sales Department includes a money market department
that trades with corporate accounts which deal primarily in short-term money
market instruments and are large buyers of tax-exempt notes and bonds.
o To underline our commitment to institutional purchasers, the Firm sponsors
annual seminars at which various municipal issuers discuss their capital needs
with institutional buyers. This commitment effectively facilitates issuer/investor
communication and enhances our relationships with institutions as well as
providing an excellent source of education regarding municipal finance.
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RETAIL SACES CAPABILITY
Rauscher Pierce Refsnes has one of the most productive retail sales systems for distributing
exempt securities in the West and Southwest. This is accomplished through several impox
procedures.
o Daily conference calls during the week prior to the initial pricing of a managed
negotiated offering between the Public Finance Division specialist assigned to the
financing and the entire retail distribution system to discuss credit information
and other important aspects of the offering
Our Municipal Syndicate Department arranges, in major cities, sales information
meetings between key municipal dealers, their retail and institutional account
executives and the issuer. Discussions are held regarding credit information and
other facets of the proposed financing.
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Total coordination between our retail distribution system and Municipal Syndicate Department
enables Rauscher Pierce Refsnes to dramatically increase its participation in negotiated financ
thus resulting in a more complete sales effort.
TAX-EXEMPT TRADING
Buyers are more inclined to buy a new issue of bonds or notes if they can expect a "liq
secondary market to be maintained in the securities. Rauscher Pierce Refsnes believes that accurate structuring and pricing of securities requires a broad and intimate knowledge of the
exempt capital markets. Rauscher Pierce Refsnes has a nationally recognized tax-exempt tra
capability in the secondary markets for all tax-exempt securities. The Firm's daily inventory posi
ranges up to $25 million.
SHORT-TERM QUALIFICATIONS
As short-term financing gained acceptance in the municipal market place in the early 19,
Rauscher Pierce Refsnes recognized the importance of developing new and innovative short-1
financing techniques. In response to this increased demand for short-term financing, Rauscher Pi
Refsnes established a short-term underwriting and sales department to maintain its strong distribu
system. In 1986, in the category of full credit to lead remarketing agent for Variable Rate Dem
Obligations, Rauscher Pierce Refsnes ranked 9th nationally, as compiled by the Securities I
Corporation. The Firm is currently acting as Remarketing Agent for over $2.4 billion in variable 1 securities.
POST-MARKETING SUPPORT
We strongly believe that the responsibilities of an investment banker do not end with
conclusion of a successful financing.
Both our Municipal Research and Trading Groups play a key role in providing post-marke
We maintain active secondary markets for all of our munic support and services to our clients.
clients' bonds.
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Rauscher Pierce Refsnes will also provide a complete sales analysis to each of our clients witk detailed evaluation of the state-by-state breakdown of the following types of investors who purch;
bonds or notes.
o Insurance Companies.
o Commercial Banks.
o Bond Funds.
o Corporations. o Dealers. o Dealer Banks.
o Individuals.
In addition, Rauscher Pierce Refsnes regularly assists our clients in the review of their cre
ratings, communication with bond counsel on issues which may affect operations or future financir
and the evaluation of new financing techniques. When such reviews indicate attractive new financi
approaches, advance refundings or other cost saving opportunities, Rauscher Pierce Refsnes v
recommend that specific actions be initiated to accomplish our clients’ goals.
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PROPOSAL TO SERVE AS
FINANCIAL ADVISOR
CITY OF CARLSBAD
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FOR THE
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HOSP GROVE
GENERAL OBLIGATION
BOND ISSUE
RAUSCHER PIERCE REFSNES, INC.
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RAUSCHER PIERCE REFSNES, INC.
August 29, 1986
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Mr. James F. Elliott
Finance Director
City of Carlsbad
1200 Elm Avenue
Carlsbad, CA 92808
Dear Mr. Elliott:
Rauscher Pierce Refsnes, Inc. is pleased to have this opportunity to submit a proposal to a
financial advisor to the City of Carlsbad's proposed Hosp Grove General Obligation Bond Issue.
Since 1931, Rauscher Pierce Refsnes, Inc. has been continuously engaged in provj
professional financial advisory services to state agencies, cities, towns, counties, school dist
community college districts, universities and special districts in California Today, Rauscher P Refsnes is one of the largest regional investment banking firms in the country, with a complemer
over 1,000 men and women providing services in all areas of public and corporate finance.
The firm has grown to the point that in 1985, Rauscher Pierce Refsnes, Inc. was ranked nul
10 nationally in providing financial advisory services. In addition, the firm ranked number 2 ai all firms "local" and "national" in providing financial advisory services for California issuers
bond offerings brought to market in 1985.
Our proposal details the firm's qualifications to serve as your financial advisor. We at Raus
Pierce Refsnes, Inc. feel that the firm brings to the City the experience and capability of a 1
national investment banking firm, coupled with the local knowledge and the "hands on" experiencc
a regional firm in dealing with problems unique to California and the Southwest. It is
combination of these two qualities that distinguishes our firm from the others under considera
and, we believe, places us in the unique position of being able to provide the highest calibei
service for the City's financial needs. Briefly, the summary of our qualifications is as follows:
a Over 50 years of commitment to California in providing financial advisory servic
virtually every type of municipal entity which has resulted in an unparalleled understanr
of local credits;
One of the largest and most experienced professional staff of bankers located and livii
California;
The most complete in-house computer capability of any investment banking firm locater
California;
The number 10 ranking nationally in providing financial advisory services;
The number 2 ranking as financial advisor (by dollar volume) in California; and
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One California Street, Suite 2630 . San Francisco, California 94111 . (415) 989-2300
Member New York Stock Exchange, Inc.
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0 The number 12 ranking nationally in senior managed underwritings of all tax-exemp issues.
We appreciate the invitation to present our credentials to the City and welcome any follc
questions you may have.
Yours sincerely,
RAUSCHER PIERCE REFSNES, INC.
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Janet E. Hawkins 1 Assistant Vice President
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TABLE OF CONTENTS
Sectio
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Description of Firm
Personnel
1 Financial Advisory Experience
Market Strategy and Estimated Sizing of
Scope of Services
References
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General Obligation Bond Issue
I Proposed Fee Structure
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R California Marketing Capability
Overview of Rauscher Pierce Refsnes, Inc.
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1. DESCRIPTICIN OF FIRM
Rauscher Pierce Refsnes, Inc. was founded in 1931 as an underwriter and distributoi
corporate and municipal securities. Today, Rauscher Pierce Refsnes, Inc. is one of the la]
regional investment banking firms in the country with a complement of over 830 men and WOI
The total assets for the firm as of December 31, 1985 are over $405.4 million, with our total ca
in excess of $25.7 million. The firm maintains its headquarters in Dallas, Texas with 32 c
regional offices located in Arizona, California, Oklahoma, Colorado, Nevada, New Mexico, New ’,
and Texas.
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Rauscher Pierce Refsnes, Inc is organized along functional lines with four major div
Retail Securities Sales, Corporate, Municipal and Operations. The Retail Securities Divisic
organized as a separate division containing most of the registered representatives for the firm
has primary responsibility for distribution of products oriented to the individual inve
Approximately 300 registered representatives are employed in the Retail Securities Division.
Within the Corporate Division are the following departments: Corporate Finance, Syndi
Research, Institutional Equity Sales and RPR Properties. Tko of the departments are involved
product origination, Corporate Finance has the responsibility of originating and bringing to ma
equity-oriented products from the private sector for distribution through the Retail, Institutic
Equity Sales, and Syndicate Departments within the firm. RPR Properties, headquartered in Da,
has primary responsibilities for originating proprietary products of a real estate nature. Th
products are distributed primarily through the Retail Securities Division.
The Municipal Division contains two departments - Public Finance and Fixed Income Secu
Trading, Underwriting and Institutional Sales. The Fixed Income Securities Department consisl
underwriting and trading facilities for tax-exempt debt securities (both short-term and long-ter
government and money market securities, and both corporate and municipal taxable dt
Additionally, Institutional Fixed Income Sales, represented by 30 sales professionals, services
marketplace from regional offices located in San Francisco, Dallas, Phoenix and Houston.
Rauscher Pierce Refsnes is a major market maker in southwestern tax-exempt credits. By vir
of the fact that the firm is domiciled in the Southwest and concentrates its business activities in I
region, we believe our public finance and underwriting professionals have particularly strong insig,
into the creditworthiness of California, Arizona, Texas and New Mexico municipalities. ’I
combination of expertise in public finance, underwriting and fixed incomes sales has resulted
Rauscher Pierce Refsnes’ recognition by Securities Data Corp. in 1985 as ranking number 10 natio
and ranking number 2 in California for providing financial advisory services. 1
The Public Finance Department, within the Municipal Division, is responsible for all investmc
banking services including the origination of both tax-exempt and taxable debt securities. Pub
Finance consists of 39 professionals experienced in all aspects of tax-exempt financing. 0
professional staff, domiciled in four regional offices including California, work together as a tez
drawing resources and expertise from all offices as needed to solve our client’s problems.
From our public finance client’s perspective, the organizational structure of the firm is orient
toward the essence of investment banking - innovation and problem solving. But even the bc
solutions to unique or mundane problems do not manifest themselves to the client’s benefit unle
those solutions are readily accessible. Accessibility is a tenet upon which our organization is buil
accessibility of our public finance professionals to our clients, both geographically and philosophicall
and accessibility of public finance professionals to research, trading, underwriting, and sales resourcl
allowing the most up-to-date and innovative ideas and information to flow to our clients. t
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This organizational strategy, in which all four major functions - public finance, underwr trading and institutional sales - provides our clients with the maximum opportunity to benefit
the concentration of resources that a group of professionals with varied experience and talents
bring to bear on ai client's needs.
Included is an Organizational Chart which depicts the names and positions of the f
"principals", its Board of Directors and Division Managers. In addition, we provided a breakdow
the professional public finance staff by regional offices, as well as a general overview of Rau
Pierce Refsnes, Inc. in Section B.
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RAUSCHER PIERCE REFSNES, INC.
PROFESSIONAL PUBLIC FINANCE STAFF
ARIZONA
Joseph L. Refsnes, Jeffrey Schubert,
Vice Chairman of the Board Vice President Robert A. Vanoksy, Jerry M. Walker, Senior Vice President Vice President Bruce D. Kelley, Ross B. Borneman, Vice President Assistant Vice President Janice L. Mimovich, James R. Feltham, Vice President Assistant Vice President Harry C. Pernell, Gary L. Trujillo, Senior Associate Vice Presidenit Zach A. McReynoIds, Associate
Suzanne M. Cade, Associate
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CALIFORNIA
Ernest B. Bodnar,
Leslie 0. Lynch,
James W. Martling,
Mark S. Dresslar,
John L. Geesman,
Janet E. Hawkins,
Assis tan t Vice President Virginia L. Horler,
Assistant Vice President
William R. Rutherford,
Assistant Vice President
Grant M. Hamill, Senior Associate
Jeanie S. Fay, Associate
Cary A. Petzel, Associate
Suzanne Schmidt, Analyst Lynn Terrizzi, Research Assistant
Senior Vice President
Senior Vice President
Senior Vice President
Assistant Vice President
Assistant Vice President
TEXAS
Milton F. Halpern,
Dale R. Henderson,
Robert R. Veach, Jr.,
Thomas M. Anderlitch,
Robert G. Day,
Charles J. Hall,
Gregory C. Green, Senior Vice President Assistant Vice President Gary P. Machak, Senior Vice President Assistant Vice President
Me1 H. Schonhorst, Vice President Assistant Vice President
James Strieldin, Senior Associate Vice President Richard Hernandez, Associate
Henry Lopez, Associate Vice President Garret Smith, Associate
Levi Davis, Associate Vice President William Gumbert, Analyst
Mat Hagen, Analyst t
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2. PERSONNEL,
Rauscher Pierce Refsnes Personnel
Rauscher Pierce Refsnes, Inc. employs the "team" approach to provide clients with access to
full range of talents available from both the Public Finance and Sales, Underwriting and Tr:
Departments. Rauscher Pierce Refsnes has designated four professionals from its Public Fin
Department to assist the City in developing the following objectives:
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e Develop an optimal structure to maximize the amount of proceeds available to
the project while issuing as few bonds as necessary.
Identify the optimal structure for the legal documents.
Assist with election campaign for necessary bond authorization.
Develop a marketing strategy to provide the best institutional and retail investor
reception for the proposed bond issue.
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The individuals assigned to the City have significant experience in traditional city finance
general obligation bond programs in California While the full banking and marketing resources
Rauscher Pierce Refsnes will be available to the City, the banking professionals assigned to the (
have been assembled because of their involvement in projects similar to that of the City's.
Investment Banking
Years of
Personnel to Industry
be Assimed Exuerience Resuonsibilitv
Janet E. Hawkins 9 Project Manager
Assistant Vice President
Virginia L. Horler 14 Document Review
Assistant Vice President
Gary L. Trujillo 3 Document Structuring u Senior Associate
II Analyst
Suzanne Schmidt 1 Debt SchedulesWid Analysis
To ensure the successful implementation of the City's general obligation bond program, qualifi
personnel with experience in this type of financing will serve as key representatives to the City
Carlsbad. Rauscher Pierce Refsnes, Inc. is committed to providing our clients with a top level
service through these key individuals and their ready availability to the City's staff. Brief resum
of the professionals assigned to the proposed program appear on the following pages.
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JEANIE FAY - Associate
Miss Fay joined the firm in May 1985, after working in the red estate industry in syndica
and project finance. Prior to that she worked for Oppenheimer & Co., Inc. in both Los Angeles
Houston as an S.E.C. Registered Representative and Research Analyst.
Since joining the firm, Miss Fay has assisted in the structuring of various types of PI
financings including over $30,000,000 in Assessment District Bonds and Certificate of Particip:
issues for several cities including Berkeley, Cupertino, Hercules and Santa Monica. In addition,
Fay serves as a member of the Financial Advisory team for the Sacramento Municipal Utility Di!
and the East Bay Municipal Utility District. Projects Miss Fay is currently working on include
refunding of an assessment district bond issue and several transactions involving the transfer of
owned properties to qualified non-profit entities for the financing of various capital improvements.
Miss Fay received her B.A. from Stanford University and her M.B.A. from Northwes
University with an emphasis in Finance.
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/I_/_’’ PROJECT TEAM
/ /’ Janet E. Hawkins, Assistant Vice President
Ms. Hawkins has over eight years of professional experience in ,dicipal finance. A spec
in the fields of special assessment and health care financing,, ,MS. Hawkins has participate(
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securities offerings totaling more than $250 million. /’
Projects on which Ms. Hawkins has participated’include the financing of street improvem
water and sewerage system improvements, off-street parking facilities construction, hoz
construction and renovation, convention center construction, and downtown redevelopr
Ms. Hawkins has been involved with a number of general obligation bond issues in Califc
including projects for North Thoe Public Utility District, Padre Dam Municipal Water District
Oak Park Unified Schybdtrict. Ms. Hawkins has also acted as financial advisor for a numbe
bond authorization elections including projects for Wheatland Water District, the City of Belmont
the City of Soledad / Apaduate of San Francisco State University, Ms. Hawkins has also done graduate worl
?Clara University.
Virginia L. Horler, Assistant Vice President
Mrs. Horler has over 14 years’ experience in municipal finance and has participated in over $
million in debt financings, including serving as project manager on the Richmond Redevelopn
Agency, Harbour Redevelopment Project, 1985 Tax Allocation and Refunding Bonds.
Mrs. Horler is the author of Guide To Public Debt Financinv In California, a reference to sh
and long-term financing techniques available under both California and Federal law. In the Gu
Mrs. Horler analyzes the major aspects of tax-exempt financing and describes the roles played by
financing team. The Guide was published and distributed by Rauscher Pierce Refsnes, Inc. to o
7,000 public officials and interest citizens throughout the United States and also serves as a textbc
in graduate classes in public finance.
Prior to joining Rauscher Pierce Refsnes, Inc. in 1983, Mrs. Horler was employed by the City
Richmond and was responsible for budget preparation, cash flow analysis, forecasting and investme
of public and pension funds. She also served on the State Board of Directors of the Calif01
Municipal Treasurers’ Association for three years and coordinated all CMTA business meetings
northern California for two years. She has participated as a speaker at numerous workshops a
seminars conducted by professional finance officers’ associations throughout California.
Mrs. Horler graduated with Honors from St. Mary’s College with a Bachelor of Arts Degree a
a Master’s Degree in Business Administration. In addition to her education, she is a member of 1
following organizations: Governmental Finance Officers’ Association; California Society of Munici,
Finance Officers; California Municipal Treasurers’ Association; San Francisco Municipal Forum; a
California Assessment Bond Underwriters’ Division of the Public Securities Association.
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Garv L. Truiillo, Senior Associate
Mr. Trujillo joined Rauscher Pierce Refsnes, Inc. in June 1984 after working in Sales
Trading for an affiliate company of a national investment banking firm in New York City. Prio
that, he worked for the Arizona State Legislature as a research analyst for the Senate Judil
Committee.
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Mr. Trujillo has been involved with a number of financings and has developed an expertis
the advance refunding of tax-exempt obligations and also in the structuring of tax allocation I 1 financings.
Mr. Trujillo assumed primary responsibility for the mathematical computations relating to
debt sizing of the: negotiated $24,400,000 City of San Jose, California Airport Revenue Refun
Bonds, Series of 1984. The scope of his services included verifying the debt schedules
determined what amount of US. Treasury Obligations -- State and Local Governments were needel
be purchased (e.g., $24,400,000) in order to refund the outstanding bonds (Series of 1974, 1976, . 1 and 1980) totaling $27,360,000.
He also assuimed primary responsibility for the day-to-day document review sessions while F was acting as Financial Advisor for the negotiated $85,960,000 City of San Jose, California Aiq
Revenue Bond issue. The scope of his engagement consisted of verifying the mathematical ~CCUI
of computations developed to determine annual principal and interest payments and also providing
deficiencies on the information contained in the Official Statement and legal documents.
Mr. Trujillo received his B.S. from Arizona State University with a major in accounting.
Mr. Trujillo is a member of the San Jose Hispanic Chamber of Commerce, a board member of
San Jose Developrnent Corporation, a board member of Opera San Jose, and a board member
Chicanos Por La Causa, Inc.
Suzanne M. Schmidt, Analyst
Suzanne Schmidt joined Rauscher Pierce Refsnes, Inc. in July 1986 after working as a markei
At IBM, I representative assistant in the Information Systems Group of the IBM Corporation.
developed expertise in the use of personal computers for financial applications.
Currently Ms. Schmidt is preparing computer analyses for various municipal clients utiliz
Rauscher Pierce Wefsnes, Inc.’s innovative Asset Transfer Program. Ms. Schmidt also assists t
professional staff in designing computer-based financial tools and cash flow projects.
Ms. Schmidt received her B.S. from the Business School of Administration at the University
California, Berkeley with an emphasis in Finance and Marketing.
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3. J?INANCW, ADVISORY EXPERIENCE
Rauscher Pierce Refsnes, Inc. has continuously provided financial advisory service:
municipalities in the Southwest and particularly the State of California for over 50 years. D
this period, we have based our business and professional "expertise" on a commitment to service
to excellence. Our recognition as one of the largest regional investment banking firms in
country is complemented by our national and regional rankings. In 1985 alone, our firm acte
financial advisor ffor California issuers totaling approximately $705.9 million in financings and
issuers in the southwest totaling over $2.4 billion. In the past 10 years, the lirm has proT
financial advisory services for over 901 issuers nationwide totaling approximately $8.2 billion.
addition, in 1985 Rauscher Pierce Refsnes ranked number 10 nationally and ranked number
California in providing financial advisory services to clients across the nation. On the fol
pages we have illustrated our local and national rankings with respect to financial advisory services.
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Rauscher Pierce Refsnes, Inc.3 record of service as financing advisor to clients in the issu'
of general obligation bonds is unsurpassed in the Southwest.
national recognitioin gives us the capability to meet the needs of both small and large issuers.
example, in 1986 !we have acted as financial advisor to both the City of Giddings, Texas, $750
General Obliation Bonds, Series 1986 and the City of Tucson, Arizona, $52,000,000 General Obliga
Bonds, Series of 1984-B (1986). The following table summarizes the number of projects and
amount of general obligation bond issues for the last three years.
Our firm's regional specialization
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Number of Par Amount
Proiects of Bonds
1986 (through August) 14 $195,225,000 1985 25 282,230,000 m 1984 17 180,920,000
California issuers for whom we have acted as financial advisor in 1986 include City of Sa,
Ana, City of Ukiah, City of Burlingame, Fremont Unified School District and East Bay Munici
Utility District. Our firm has also acted as financial advisor to several north San Diego COUI issuers including San Marcos County Water District, Oak Grove Unified School District, Oceans
Unified School District and Carlsbad Unified School District Educational Facilities Corporation.
Listed in detail on the following pages is information regarding Rauscher Pierce Refsnc
financial advisory services performed the first half of 1986. It should be noted that included wit1
this list are city and county general obligation, water revenue, sewer revenue, street and highw
revenue, improvement district debt and tax allocation bonds, as well as municipal property corporatic
bonds and certificates of participation, and university, community college, school district, and stal
issued securities. Both fixed and variable rate debt are included.
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TOP 10 FINANCIAL ADVISORS
CALIFORNIA ISSUES - 1985
SHORT TERM-NOTES & PRIVATE PLACEMENTS EXCLUDE
k
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$ h 1 Rank Firm Volume Issues z
I 1 PaineWebber Incorporated 1637.2 30
2 RAUSCWER PIERCE REFSNES, INC. 1395.3 10
3 Price Waterhouse & Co. 1369.4 33
4 J. J. Aowry & Company, Inc. 855.8 12
5 Cainc Gressal Midgley Slater 773.1 45
6 Donaldson, Lufkin & Jenrette 465.0 4
7 Grigsby Brandford & Co., Inc. 435.0 6
8 Merrill Lynch Capital Markets 431 .O 6
9 Shearson Lehman Brothers, Inc. 419.0 4
10 E. F. Hutton & Company, Inc. 376.3 12
#
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Source: Securities Data Company, Inc.
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4. MARKET STRATEGY AND ESTIMATED SIZING OF GENERAL OBLIGATION BOND ISSUE
In order to set the stage for a discussion of the planning of debt issues, a brief review of
bond market is necessary. During periods of particularly high prevailing interest rates, a n
aggressive debt repayment schedule might be more appropriate in order that high annual inte
costs are not prolonged unnecessarily. Variable rate credit might also be more attractive at
time. The benefit of lengthening maturities exists when interest rates are at the current levels
prevail in 1986. Tlhe Interest Rate Comparison Chart that follows compares tax exempt bond yield
measured by the Bond Buyer’s Index of 20 Municipal Bonds with the New York Bank prime rate.
exhibit clearly indicates that current yields for tax exempt bonds are at the lowest levels since 1
and the prime rate is at its lowest level since 1978.
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Many factors cause interest rates to vary, including inflation, the level of economic acti
federal policies, federal deficits, and market anticipation. Current conventional wisdom contempl
relative stability in interest rates through year end 1986, and a probable gradual increase therea
The abatement in oil prices should mitigate future dramatic increases in inflation such as occurrec
the early 1980’s and thus tend to hold interest rates down. However, other factors such as the
reform legislation are causing tax exempt interest rates to settle at what are historically relati
high levels, particularly when compared with taxable instruments.
The MarketDlace and Debt Stratepies I
The marketplace for tax exempt bonds has changed dramatically during the past decade.
tax exempt mutual1 fund is of increasingly more importance as a vehicle by which the indivi
investor can participate in the municipal market. Individuals benefit from the diversity, professi
ongoing management, and enhanced liquidity of a bond fund when compared with a retail purcl
Because of the increased growth of the tax exempt mutual funds, municipal bond unit trusts,
increase in size of trust funds under professional management, the increase in size of insur(
companies, and the growth of commercial bank portfolios, the market has become much n
institutional in nature. It is imperative, therefore, that the City of Carlsbad continually strivc
make its bond offerings marketable to the institutional market. As these efforts continue,
marketplace for the City’s debt will expand, allowing better distribution and providing the opporh
for lower interest rates.
In general, institutional buyers have defined needs for their purchase of tax exempt securi
Issues must be of sufficient size in the various maturities to allow substantial purchases and adeq
liquidity in the secondary market. Individual segments of the market have specific maturity range
which they buy securities. Commercial bank portfolios typically purchase one- to seven-
maturities; trust buyers tend to be in the five- to twenty-year range; unit trusts and bond funds
most interested in longer maturities; and insurance companies purchase securities according to 1
portfolio needs and risk evaluation. It is most important, therefore, that the City’s financial ac
have an active trading and underwriting desk that can provide continual accurate information
active buyers in the marketplace prior to the final structuring of an issue.
Also inherent in these maturity decisions are the viewpoints of the rating services, which pi
low debt burdens, and the City’s need to recapture bonding capacity. Traditionally, California is:
have kept maturities relatively short, consequently repaying debt quickly, satisfying both the r;
services and the need for capacity recapture. Market conditions in the future and greater borro
requirements may well necessitate a less aggressive repayment schedule. t
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MuniciDai Bond Ratings
The average interest rate at which a State, County, School District, City or University S
This credit rating r( sells its bond is greatly affected by the credit rating of the municipality.
the economic and financial condition of the municipality.
Two major bond rating firms, Moody’s Investors Service and Standard & Poor’s Corporatioi
assess any new municipal bond issuance with regard to investment merit. The most highly reg
issues are assigned an Aaa (Moody’s) or AAA (S&P) rating. Using the Moody’s system, the r
descend from Aaa as follows:
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Aaa ............................. Highest Quality
Aa 1
Aa
A1
A
Baa 1
Baa
Ba 1
Ba
B1
B
Caa
Ca
C ............................. Lowest Quality
Any issue rated Baa or better enjoys good marketability. Lower interest rates will be realiu
issuers having higher ratings than those with lower ratings assuming the issues are compa
Beginning with the Baa and Baa 1 ratings, interest rates may decline from 1/4 of 1% to 1/2 of 1
the rating is advanced.
Rauscher Pierce Refsnes, Inc., as financial consultant, is continually compiling and subm
financial and economic data to the rating services. Such has resulted in a substantial numbt
rating increases for municipalities. Presented on the following pages is a list of over
municipalities that have either received initial bond ratings or bond rating increases since 1975, P
Rauscher Pierce Refsnes, Inc. has acted as financial consultant. n
1 Tax Reform Act
Much has been written about proposed tax reform in 1986. The various proposals for tax re
have potentially significant effects on the future plans of municipalities for bond issuance pursuar
the Joint Committee Statement that September 1, 1986, will be the effective date of tax legisla
Among proposals in the proposed legislation is one calling for a rebate to the Federal Governmei
any excess arbitrage profits earned by the issuer. The three-year temporary period for invest]
will also be disallowed under proposed legislation. Now that the Conference Committee has agree
a tax reform proposal, it seems certain that a bill in substantially the same form as approved bJ
Conference Committee will be approved by both Houses and signed by the President.
1
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Bond Rating Increases Since 1975
Rauscher Pierce Refsnes, Inc.
Moodv's Rating Sale Issue
Date - Amount Issuer Previous - NeN
8-20-86 $13,990,000 City of Santa Ana, COPs A A1
8-01-86 12,705,000 City of Fremont, G.O. A A1 7-16-86 9,800,000 City of Cupertino, COPs NR A 7-16-85 10,600,000 City of Campbell, G.O. A A+ 6-18-85 60,000,000 Fresno County, TRANS MIG 2 MIG 1
3-18-85 825,000 Apache County, G.O. Baa1 A
3-01-85 9,090,000 City of Hercules, COPs NR BBB+
1-08-85 30,000,000 Maricopa County CCD, G.O. A1 Aa
11-19-84 8$00,000 City of Richmond, TRANS MIG 2 MIG 1
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11-05-84 445,000 Town of Mammoth, Str & Hwy User Rev NR Baa 8-01-84 1,500,000 City of Apache Junction, Str Hwy User Rev NR A
5-21-84 3,335,000 City of Casa Grande, Str & Hwy User Rev NR A
5-21-84 835,000 City of Casa Grande, G.O. Baa A 1-31-84 11,000,000 City of Scottsdale, Str & Hwy User Rev NR A1
1-31-84 20,000,000 City of Scottsdale, G.O. Aa Aa 1 12-06-83 24,210,000 City of Phoenix, Var Purp G.O. Aa Aa 1
6-07-83 23,l's50,000 City of Phoenix, Var Purp G.O. AA AA+ I
4-29-83 3,500,000 City of Burlingame, COPs NR AA- 3-01-82 1,2!00,OOO Thatcher Unified S.D. No. 4 NR Baa 1 2-18-82 1,845,000 Patagonia Union High S.D. NR Baa 1 12-07-81 6,465,000 Mesa Unified S.D. No. 4 A1 AA- 4 7-20-81 6,500,000 Kingman Elem. S.D. No. 4 Baa 1 A 7-1 1-81 1,800,000 City of Kingman, G.O. Baa A 6-22-8 1 8,600,000 Ruth Fisher Elem. S.D. No. 90 A A1 4- 14-8 1 14,500,000 City of Glendale, AZ. Wtr & Swr Sys Rev NR A 3-02-81 1,475,000 Mayer Unified S.D. No. 43 NR Baa 1 12-08-80 4,700,000 Miami Unified S.D. No. 40 NR A 6-17-80 1,800,000 City of Scottsdale, Wtr & Swr Sys Rev A A1 6-02-80 10,600,000 Phoenix Elem. S.D. No. 1 NR A1 3-20-80 16,835,000 City of Tempe Municipal Property Corp. A A+ * 1-28-80 400,000 Ruth Fisher Elem. S.D. No. 90 NR A 1-22-80 21,500,000 Pima County, Sewer Revenue NR A 10-22-79 3,770,000 Globe Unified S.D. No. 1 NR A
8-10-79 300,000 Lake Havasu S.D. No. 25 Baa Baa 1
6-12-79 3,000,000 City of Flagstaff, G.O. A A1 6-04-79 1,920,000 Wickenburg Unified S.D. No. 9 Baa Baa 1
2-21-79 400,000 City of Douglas, Sewer Imp. NR Baa 1
*
2- 13-79 4,000,000 Creighton Elem. S.D. No 14 NR A 1-22-79 350,000 Town of Goodyear, G.O. NR A
1-22-79 150,000 Town of Goodyear, Str & Hwy User Rev NR A1
12-12-78 1,000,000 City of Glendale, G.O. NR A1
6-27-78 1,000,000 City of Scottsdale, G.O. A1 Aa
6-05-78 6,000,000 Washington Elementary S.D. No. 6 A* A+ *
6-05-78 4,475,000 City of Tucson, G.O. A+ * AA- *
5-15-78 i,goo,ooo Catalina Foothills Elem. S.D. No. 16 A* A+ *
5-15-78 5,570,000 Sunnyside Unified S.D. No. 12 Baa A
5-11-78 3,670,000 City of Safford, Wtr, Elec & Gas Sys Ref Baa A
4-17-78 7,700,000 Flagstaff Unified S.D. No. 1 A A1 t
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Sale Issue Moodv's Ratinp Date - Amount Issuer Previous New
4-03-78 $38,250,000 Mesa Unified S.D. No. 4 A A1 1-16-78 815,OOO Peoria Municipal Develop. Autk NR Baa 1
1-06-78 450,000 Mohave Valley Elem. S.D. No. 1 NR Baa 1
12-08-77 1,600,OOO City of Chandler G.O. NR A-
12-08-77 1,000,000 City of Chandler, Str & Hwy User Rev NR A1
11-01-77 1,500,OOO Mt Graham Hospital Disrict NR C0nd.A
8-01-77 800,OOO Crane Elementary S.D. No. 13 Baa 1 A
7-26-77 9,010,000 Ariz. Bd. of Regents, N.A.U. Rev Ref A A1
7-18-77 Yo0,OOO Round Valley Consold. Elem. S.D. No. 10 NR Baa 1
5-17-77 15,000,000 City of Phoenix Airports Revenue A A+
4-19-77 4,315,000 HoIbrook Unified S.D. No. 3 NR Baa 1
2-10-77 7,000,000 City of Tempe, G.O. A* AA
1-11-77 2,(Doo,000 City of Glendale, Str & Hwy Rev NR A1
1-10-77 3,200,000 Roosevelt Elementary S.D. No. 66 Baa Baa 1
11-09-76 13,700,000 Ariz. Bd. of Regents, A.S.U. Revenue A* AA: 3-22-76 10,000,OOO Glendale Union High S.D. No. 205 A* A+
11-18-76 1,390,000 Joseph City Unified S.D. Baa A 8-28-75 4,600,000 Ariz. Bd. of Regents, N.A.U. Revenue NR CondA 8-04-75 900,000 Litchfield Elementary S.D. No. 79 Baa A 7-07-75 1,600,000 Crane Elementary S.D. No. 13 Baa Baa 1
6-30-75 10,235,000 City of Tucson, G.O. Refunding A* A+ *
6-16-75 940,000 Florence H.S.D. No. 81 NR A
6- 16-75 815,000 Florence Elementary S.D. No. 1 NR A
4-21-75 1,600,000 Flowing Welts H.S.D. Baa A
4-21-75 1,800,000 Flowing Wells Elementary S.D. No. 8 Baa A
4-08-75 7,800,000 City of Phoenix Civic Imp. Corp. A Aa
4-03-75 6,250,000 City of Tempe, G.O. A+ A+ *
4-03-75 3,850,000 City of Tempe, Wtr & Swr Sys Rev A* A+ *
3-25-75 5,300,000 Az Bd. of Regents, U of A Stad Imp Rev A A1
3-24-75 10,235,000 City of Tucson, G.O. A* A+ *
3-24-75 2,500,000 City of Tucson, Str & Hwy Imp A A1
3- 10-75 500,000 City of Prescott, Str & Hwy Imp NR A1
3-10-75 600,000 City of Prescott, Wtr & Swr Sys Rev A A1
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3-10-75 3S0,OOO City of Prescott, G.O. Baa 1 A
1-23-75 850,000 City of Tempe Muni Property Corp NR A *
* Standard & Poor's Rating.
G.O. denotes Geneiral Obligation Bonds.
NR denotes municipality as previously non-rated. I
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Estimated Sources and Uses of Funds
City of Carlsbad, California
Hosp Grove Aquisition Project
General Obligation Bond Authorization $5,950,000*
costs of Issuance:
Bond Rating Fees $ 5,000
Bond Printing 2,500 Printing and Distribution of Official Statement 10,000
Election Expenses 10,000
Financial Advisor 25,000
Bond Counsel 25,000
RegistrarPaying Agent 5,000
Miscellaneous Expenses 2.500
$ 85,000 1 Acquisition Proceeds $5,865,000
*Estimated Debt Service Schedule follows
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CITY OF CRRLSRFID
HOSP GROVE RCQUISITION PROJECT
ESTIMRTED DEBT SERVICE SCHEDULE
RUGUST 28, 1986
Delivery Date 01/01/87
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pate p,r.L!!slea,l CPUEa_rC -------- I nt erert Lc(t,al Qnn
07/01 /87 2 14,300.00 214, 300.80
01/01/88 93,000.00 5.500
07/01 180 212,287.50 212,287.50
07/01 /83 209,412.50 20544 12.50
0 1 /0 1 /90 1 l@, 000.00 6.000 209,412.50 313, 412.50 528,825 07/01 /30 206,112.50 206,112.50
07/01 /9 1 282,547.50 202,547.50
01/01/92 1201, 000. 00 6.400 282,547.50 322,547.50 525,035 07/01 /92 138,707.50 138,707.50
01/01/93 13011000.00 6.600 198,707.50 328,707.50 527,415
07/01 /93 134,417.50 194,417.50
01/01/94 1401,000.00 6.750 194,417.50 334,417.50 528,835 07/01 /94 189, 632.50 189,692.50
0 1 /0 1 /35 14%, 000.00 6. '300 183,632.50 334,692.50 5124,385 07/01/35 184,630.80 184,630.00
07/01 /36 173,030.80 179,090.00
173,090.00 349,090-00 528,180 01 /01/97 170,000.00 7.100
07/01 /37 173,055.00 173,835.80
180,000.00 7.200 173,055.00 353,855. 00 526,110 01 I0 1 / 38
07/01 /98 166,575.00 166,575.00
01 /0 1 /39 135,808.00 7.250 166,575.00 361,575.00 528,150,
153, 506.25 153,506.25
210, 008. 00 7.250 159,506.25 369,506.25 529,812.
151,833.75 151,833.75 07/81 /00
01/01/01 225,800.00 7.300 151,893.75 376,833.75 528,787. 07/81/01 143,681.25 143,681.25
01 10 1 102 240,088.80 7.300 143,681.25 383,681.25 527,362. 07/01/02 134,321.25 134,321.2s
07/01 /03 125,558. 80 125,550. 00
01 /@l/VI4 275, 800. 00 7.480 125,550. 80 480,558.88 526, 180.
214,300.80 309,988.00 524,800
01 /01/89 1001,000. 00 5.750 212,287.50 312,287.50 524,575
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01/01/31 1 1S, 000.00 6.200 206,112.50 321, 112.50 527,225
01 /01/36 160, 800.00 7. 000 184,630-08 344,630.00 523,3aa
01/01/03 255,000.08 7.350 134,921.25 389,321.25 524,842.
07/81 /84 115,375.80 115,375. 00
81 /81/05 235, 808.88 7.480 115,375. 88 4 10,375. a8 525,750.
07/01 /a6 92,548.08 32,548. 08
01/01/07 340, 88~. 88 7.450 92,548. 80 432,548. 00 525,888.
v)1/81/08 365,800. 88 7.500 73,075. 80 444,875. a8 524,750.
01 /01/09 335, 800. 00 7.500 66,187.50 461,187.50 527,375.
81/01/10 435, 800. 00 7.580 51,375.80 476,375. 88 527,758.
87/01/10 35,437.50 35,437.50
07/81/85 104,468.80 184,460. a0
01/81/06 328,800.80 7.450 184,460. 80 424,4CO. 80 528,32.6.
67/01 /07 73,875. 80 73,875. @0
07/01 /0B 66,187.50 66,187.58
07/01 /03 51 , 375.00 51,375.80
01/01/11 455,000. 88 7.500 35,437.50 430,437.50 525,875.
07/01 /11 18,375.60 18,375.00
01/01/12 ,-42gLa@@,a@ 7.500 ---18,375.88 588,313-gg ---326L75@:
Tot a 1 s I 5,350,0a0.00 7,221,330.00 13, 171,330.80 13, 171,330.
Less Flccrued From 01/81/87: .00 . 00
- Net Cost: 7,221,330. 00 13,171, ma. 88
Values From Dated Date: Flverage Interest Rate 7.38452763
average Life 16.435
Bond Years 37,738.080
Values From Delivery Date:
Bond Proceeds : 5,350,000.80
True Interest Rate 7.35885369
Day Basis is 30/360 (Municipal Bond)
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5. SCOPE OF SERVICES
The consulting services offered by Rauscher Pierce Refsnes, Inc. span several broad ai
as follows:
Financial Planning .. Development of a marketable financing program which not only serves the ne
of the City, but is also cognizant of the taxpayers.
Suuervision of Legal Proceedings - Complete involvement in all legal matters and statui
requirements to avoid unnecessary setbacks. Attendance at City meetings wherein statutory elect
and financing requirements are fulfilled.
Public Information - Participation in public or group meetings to inform voters of all finan
implications.
Creation of a Comuetitive Market - Preparation and distribution of competent information (Offi
Statement) concerning the bond issuance to the financial community in order to stimulate bidc
interest. Total involvement with rating services. Aggressive market presentation to develop lov
possible interest cost to City.
Timely Completion - Delivery of bond proceeds to the City as scheduled.
Continuinv Interest - Follow-up attention to the bond proceeds with the City Finance Director
insure such are adequately invested.
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In more specific terms, Rauscher Pierce Refsnes, Inc. will provide a complete financ
service as detailed below: I@ PRE-ELECTION
Rauscher Pierce Refsnes, Inc. will:
1. Meet with the City Council, its administrative staff, bond attorney/or City Attorney i
any other individual or body to gain a complete understanding of the project to
financed and the intentions of those involved.
2. Develop the specific financing program which best serves the interests of the City,
project and its taxpayers.
3. Assist the City in conveying its financing proposals to or meeting with taxpayers
deemed necessary.
Develop an election and financing schedule. 4.
5. Assist the bond attorney and/or City Attorney in the preparation of complete le I proceedings.
I 6. Attend public or group gatherings which the City would require to explain all poten.
financial effects resulting from a bond issue.
Attend to any details which may additionally arise in the course of the pre-election period 7. t
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POST ELECTION
Meet with the City at the time prescribed for the canvass of votes cast at the
election and assist staff in the canvass procedure, as necessary.
Advise investment community as to the results of election and the time schedule for
issuance.
Attend to any additional details which may arise in the course of the post-election peric
6 1.
2.
3.
PRE-FTNANCING
1.
2. Reconsult with the City Council and its administrative staff on market conditions
Re-evaluate all financing programs to assure market receptiveness.
program effectiveness.
If necessary, redesign financing program to best serve City and public interests with rt
to existing market conditions.
Assist the City in the selection of a bond registratiodpaying agent as is required.
3.
4.
5. Assist the bond attorney and/or city Attorney in the preparation of complete
proceedings to order the sale of bonds.
Arrange for optional publication of sale notice in the appropriate newspaper and obs
such to assure correctness and timeliness.
Work closely with the City staff to secure applicable financial and descriptive inform:
relative to the City as required for preparation of the Official Statement.
Prepare and distribute advance notices of sale to financial community.
Prepare Official Statement and distribute to financial community.
Contact and inform bond rating services concerning the City and its financing in ordel
secure a beneficial bond rating for the City.
Disseminate the bond rating status to the financial community and give full response to
inquiries from potential bidders.
6.
7.
8.
9.
10.
11.
12. Provide total market creation services to enhance issue prospects in terms of secur
minimum financing (interest rate) costs.
Attend to any details which may additionally arise in the course of the prefinancing perioc 13.
FINANCING
1. Assist prospective bidders in submission of bids to assure all bids intended for submissi
are submitted.
Meet with the City staff to verify all bids at the time of bid submission, to determine t
most advantageous bid in terms of the City and to advise the City Council that such I:
should be awarded.
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Make a detailed report to the City concerning the bond sale result.
Prepare and distribute debt retirement schedules to enable City officials to adopt PI
future budgets with regard to issue requirements.
Consult with City Finance Director concerning the forthcoming bond proceeds investmen
Assist City officials in closing document executions.
Assist in delivery of bonds to purchaser and transfer of bond monies to City’s account.
Upon delivery of bond monies, insure investment of available bond proceeds has been r
immediately.
Attend to any remaining details which may arise in the course of the financing phase.
5.
6.
7.
8.
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POST FINANCING
1. Transmil: statement of financial consultant fees and financing expenses which Raus
Pierce Refsnes, Inc. has carried in the City’s behalf.
Monitor City obligations with respect to existing market conditions in order to advisc any refinancing or other procedure which would be beneficial to the City and its taxpayel
While the consulting services of Rauscher Pierce Refsnes, Inc. have been set forth abc
many additional duties are performed previous to, during and after any financing program. Howe
the essential actions have been noted.
2.
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6. REFERENCES
Mr. John Radin, City Manager
City of Watsonville
250 Main Street
Watsonville, California 95076
(408) 728-6011
Ms. Roberta Goddard, Finance Director
City of San Luis Obispo
900 Palm Street
San Luis Obispo, California 93403
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(805) 549-7130
Mr. Ken Jett, Senior Accountant
City of Richmond
2600 Barrett Avenue
Richmond, California 94804
(415) 620-6740
Mr. Michael Hamlon, Project Manager
Richmond Redevelopment Agency
2600 Barrett Avenue
Richmond, CA 94804
(415) 620-6546
Mr. Richard K. McNely, Deputy Treasurer
City of Irvine
17200 Jamboree P.O. Box 19575
Irvine, California 92713
(714) 660-3621
Mr. C. Kent McClain, City Manager City of Fremont
City Government Building
39700 Civic Center Drive
Fremont, California 94537
(415) 790-6610
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7. PROPOSED FEE STRUCTURE
Rauscher Pierce Refsnes, Inc. normally would quote fees on a percentage basis, but pursua
AB2544 in Chapter 1033 of the 1985 California Statutes, financial advisory fees must be quote
terms of a flat fee per issue. Therefore, we have provided the following table which provides i
fee for various issue sizes.
Issue Size FA Fee
Up to 9; 3,000,000 $15,000
Up to S; 5,000,000 $20,000
Up to $ 7,000,000 $25,000
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up to $10,000,000 $30,000
Over $10,000,000 To Be Negotiated
In addition, Rauscher Pierce Refsnes would be reimbursed for the following expenses incL
during the financing:
0 Overlapping debt statement fee;
0 Bond sale advertisement fees;
0 Computer fee;
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0 Normal out-of-pocket expenses.
The financial advisor fee will be subject to and contingent upon sales of the bonds and 1
Preparation, printing and mailing of Official Statement;
All travel by Rauscher Pierce Refsnes personnel; and
from bond proceeds.
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CALIFORNIA MARKETING CAPABILITY
Underwriting
Since its inception in the 1930'~~ Rauscher Pierce Refsnes, Inc. has been a major facto1
underwriting state and local government obligations for Western and Southwestern issuers. Ta
Rauscher Pierce Refsnes, Inc. is the leading regional investment banking firm for managed negoti
tax-exempt issues.
Selected California negotiated underwritings which Rauscher Pierce Refsnes, Inc. has recc
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senior managed include the following:
0 $200 million California Higher Education Loan Authority Revenue Bonds, Series
1985;
$120 million County of Sacramento 1986/87 Tax and Revenue Anticipation Notes;
$90.4 million Irvine Public Facilities and Infrastructure Authority Lease Revenue
Bonds, Series 1985, (Capital Improvements Project);
$38.315 million City of Long Beach, California Marina Refunding Revenue Bonds,
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0 I Series 1985;
0 $26.650 million City of Berkeley, California, Certificates of Participation (Capital
Improvement Projects), Series 1985;
$21 million City of San Diego, California, Multifamily Housing Revenue Bonds,
Series 1985;
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0 $10.6 million City of Campbell, California, Certificates of Participation
(Community Center Project), Series 1985;
0 $16.14 million City of Redwood City, California, Certificates of Participation
(Capital Improvements Project), Series 1986.
Our distribution capabilities are among the strongest in the country in both the institutional
retail markets. We provide daily coverage of all of the major institutional buyers of tax-exc
securities. In addition, we maintain one of the most aggressive and productive retail sales forcc
the industry, a resource that is becoming increasingly important to issuers.
Institutional Sales Deuartment
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Rauscher Pierce Refsnes, Inc.'s powerful institutional distribution capabilities is one of our
competitive advantages. Rauscher Pierce Refsnes, Inc. has a staff of 46 tax-exempt
professionals located in Dallas, Texas, Phoenix, Arizona and San Francisco, California. 1
professionals provide the most effective institutional coverage in the West and Southwest.
Rauscher's institutional sales staff enjoys constant communication with the nation's largest n
closed and open-end bond funds, mutual savings banks, investment counselors and major life
casualty insurance companies. In addition, Rauscher's coverage of the institutional market is foc
on the trust and portfolio departments of the nation's top 1,000 commercial banks. The Firm
covers the "mini" institutions which, due to their size or location, do not receive the same attei
from our competitors. In addition: t
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0 Our Institutional Sales Department includes a money market department that
trades with corporate accounts which deal primarily in short-term money market
instruments and are large buyers of tax-exempt notes and bonds.
We have four institutional sales people in San Francisco.
0 To underline our commitment to institutional purchasers, the Firm sponsors
annual seminars at which various municipal issuers discuss their capital needs
with institutional buyers. This commitment effectively facilitates issuer/investor
communication and enhances our relationships with institutions as well as
providing an excellent source of education regarding municipal finance.
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Retail Sales Capability
Rauscher Pierce Refsnes, Inc. has one of the most productive retail sales systems
distributing tax-exempt securities in the West and Southwest.
important procedures:
This is accomplished through seve
0 Daily conference calls during the week prior to the initial pricing of a managed
negotiated offering between the Public Finance Department specialist assigned to
the financing and the entire retail distribution system to discuss credit
information and other important aspects of the offering.
Our Municipal Syndicate Department arranges, in major cities, sales information
meetings between key municipal dealers, their retail and institutional account
executives and the issuer. Discussions are held regarding credit information and
other facets of the proposed financing.
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Total coordination between our retail distribution system and Municipal Syndicate Departm
enables Rauscher Pierce Refsnes, Inc. to dramatically increase its participation in negotia
financings, thus resulting in a more complete sales effort.
Tax-Exemut Trad inp
Buyers are more inclined to buy a new issue of bonds or notes if they can expect a "liqt
secondary market to be maintained in the securities. Rauscher Pierce Refsnes, Inc. believes that
accurate structuring and pricing of securities requires a broad and intimate knowledge of the
exempt capital markets. Rauscher Pierce Refsnes, Inc. has a nationally recognized tax-exempt trac
capability in the secondary markets for all tax-exempt securities. The Firm's daily inventory posi
ranges up to $25 million.
Post-Marketing Support
We strongly believe that the responsibilities of an investment banker do not end with
conclusion of a successful financing.
Both our Municipal Research and Trading Groups play a key role in providing post-marke
We maintain active secondary markets for all of our munil support and services to our clients. 1 clients' bonds.
Rauscher Pierce Refsnes, Inc. will also provide a complete Sales Analysis to each of our cl
with a detailed evaluation of the state-by-state breakdown of the following types of investors
purchase bonds or notes: t
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0 Insurance Companies
0 Commercial Banks
0 Bond mnds
0 Corporations
0 Dealers
0 Dealer Banks
0 Individuals
In addition, Rauscher Pierce Refsnes, Inc. regularly assists our clients in the review of t
debt ratings, communication with bond counsel on issues which may affect operations or fu
financings and the evaluation of new financing techniques. When such reviews indicate attrac
new financing approaches, advance refundings or other cost saving opportunities, Rauscher Pi
Refsnes, Inc. will recommend that specific actions be initiated to accomplish our clients’ goals.
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AN OVERVIEW OF RAUSCHER PIERCE REFSNES, INC.
Rauscher Pierce Refsnes, Inc. was founded in 1931 as an underwriter and distributor
corporate and municipal securities. Today, Rauscher Pierce Refsnes, Inc. is one of the laq
regional investment banking firms in the country with a complement of over 830 men and won
providing professional services in all areas of Public and Corporate Finance. The total assets for
Firm as of December 31. 1985 are over $405.4 million. with our total capital in excess of $:
million. The Firm maintains its headquarters in Dallas, Texas with regional headquarters in Phoe
Arizona and San Francisco, California. The Firm has 32 other offices located in California, Arizc
Oklahoma, Illinois, Colorado, Nevada, New Mexico, New York and Texas.
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As of January 1, 1982, Rauscher Pierce Refsnes, Inc. became a wholly-owned subsidiary of
holding company, Inter-Regional Financial Group, Inc. Rauscher Pierce Refsnes, Inc. and C Bosworth, a mid-western investment banking firm, are the principal assets of Inter-Regional Finar
Group, Inc.
PUBLIC FINANCE
Rauscher Pierce Refsnes, Inc. is a leading participant in Public Finance. Over the past 50 yc
the Firm has provided investment banking services to cities, counties, municipal utility disti
hospital districts, school districts, universities, state authorities and many other municipal entities
virtually every type of financing. Rauscher Pierce Refsnes, Inc.3 Public Finance Departmen
currently comprised of 38 professionals with backgrounds in government, law, finance, health care
management consulting. The depth of our personnel and their experience in completing corn
financing programs for clients is unsurpassed.
Rauscher Pierce Refsnes, Inc. serves its clients as either Financial Advisor to public en1
that are required by law to solicit competitive bids or as a Managing Underwriter for negoti
sales.
During 1985, Rauscher Pierce Refsnes, Inc. served as Financial Advisor on over 100 issues
public entities in the West and Southwest in the sale of over $2.1 billion in tax-exempt securities.
In financing transactions that are complex in structure and/or impacted by voIatiIe bond mi
conditions, Rauscher Pierce Refsnes, Inc. serves public entities as Underwriter in the sale of
exempt securities on a negotiated basis. The sale of securities on a negotiated basis enables
issuer and the Underwriter to adapt the structure, timing and pricing of the transaction, as nee
to suit the then-current market conditions. During 1985, Rauscher Pierce Refsnes, Inc. has se
more than 285 public entities as the Managing Underwriter for over $9.2 billion of tax-ex1
securities.
According to statistics compiled for 1985, Rauscher Pierce Refsnes, Inc. was ranked
nationally in the area of negotiated full credit to senior manager by the Securities Data Cor
Inc.
Rauscher Pierce Refsnes, Inc. is uniquely structured to offer our clients services and be1 not available at the national firms or the small local firms. We are able to furnish our client:
sophisticated products, services and support systems while still providing the high level of per!
attention that leads to financial success and satisfaction.
In order to cope with the complex problems brought about by the large capital demands of
and local governments, Rauscher Pierce Refsnes, Inc. has developed and implemented a numbe #
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financing techniques and procedures which have proven beneficial to our clients. Within the scop
our services, we have developed financing programs implementing the use oE
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0 Health service revenue financings,
0 Industrial development financings,
0 Non-profit corporation financings,
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0 Lease and lease-purchase programs,
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Rauscher Pierce Refsnes, Inc. established its San Francisco Public Finance office on Augus
1982, through the acquisition by Rauscher Pierce Refsnes, Inc. of the assets of Stone & Young1
Municipal Financing Consultants, Inc.
Municiual Research Grouu
Revenue and general obligation bonds for advance refundings,
Both fixed and variable rate certificates of participation,
Grant, tax and revenue anticipation notes, and
Single arid multi-family mortgage revenue financing programs.
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The Rauscher Pierce Refsnes, Inc. Municipal Research Group consists of eight professionals. (
Municipal Research Group’s efforts complement the Firm’s Public Finance, Sales and Trading effc
The Group’s analytical seMces are a valuable resource in the structuring and marketing of new is
securities. Periodic research reports on our clients are prepared on their behalf and distributed the rating services and throughout the institutional and retail investment community.
Computer Services Grouu
Rauscher Pierce Refsnes’ Computer Services Group provides daily analytical support for
Public Finance Department. The Group is continually developing and implementing sophistica
computer programs to analyze and determine the most efficient financing plans for our public i
corporate clients. evaluate the advantages and disadvantages
alternative financing mechanisms that may be used to fund a project; permit adjustments in financ
plans that may be advisable due to rapidly changing conditions in the tax-exempt market; impri
investment returns; determine optimal debt financing systems; and minimize interest costs. Rausc
Pierce Refsnes, Inc.’s sophisticated computer software is linked to terminals located in our four Pu
Finance centers which gives us a remarkable tool in solving specific on-site financing problems.
These programs are designed to:
Rauscher Pierce Refsnes, Inc.’s in-house computer system is comprised of a Hewlett Pack 3000, Series 40 with 1 megabyte of memory, disc storage capacity of 400 megabytes of memorj 1600 BPS magnetic tape unit, a 400 line per minute printer, a letter quality printer, three auxil
printers, and 16 terminals. This system is dedicated as a financial analysis tool.
Over the past five years we have developed our own financial model for programs such as Sin
Family Housing cash flows, Student Loan cash flows, advance refundings and other bond structur
and modeling programs. These models have been praised by Moody’s Investors Service, Inc., Stand,
& Poor’s Corporation, Municipal Bond Insurance Association, and Financial Guaranty Insurai
Company for schedule detail and readability and have become the standards in the industry.
Our strong point is our in-house capability to create new models and enhance old models wit
a very short period of time. All of our programs are written in BASIC which allows us to deve
and change program in a shorter time period than with Fortran or COBOL. We have three full ti
programmers/operators to modify and create new financing models. -b
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CITY OF CARLSBAD
ROUTING SLIP
PERSONNEL
PLANNING
POLICE
PUBLIC WORKS ADMINISTRATOR
PURCHASING
REDEVELOPMENT COORDINATOR
UTILITIES / MAINTENANCE
ACTION TO BE TAKEN
0 FOR YOUR INFORMATION 0 PREPARE REPLY
OREVIEW AND COMMENT OSEE ME
0 INVESTIGATE & REPORT
OSIGN AND RETURN OCIRCULATE i
DADVISE YOUR PERSONNEL
R€MARKS:.Jz? &p ($&,~-~d Q7( 8. &&!( .
-e i ,< &&!&A 5/p1 .,LLb,- Bi
0 w
1200 ELM AVENUE 1
CARLSBAD, CA 92008-1989 16
Cltp of CarIs’fiab
FINANCE DEPARTMENT
May 28, 1987
San Diego Trust & Savings Bank
3150 El Camino Real
Carlsbad, CA 92008
PLEDGE OF CERTIFICATES OF DEPOSIT AND SECURITIES
I have reviewed the Promisory Note for $6,459,384 issued to San Diego Trus
Savings Bank by the City of Carlsbad, together with certified copies of
proceedings of the City Council in connection with issuance thereof. In my
opinion such note is valid and an enforceable obligation of the City, sign
by duly authorized officials thereof, according to its terms.
I have further reviewed the source of funds and status of the following
* Certificates of Deposits:
CD # AMOUNT NAME OF BANK
Torrey Pines Bank 040420391 $1,000,00(
Torrey Pines Bank 040420418 200 , OO(
Torrey Pines Bank 040420412 600 , OO(
Torrey Pines 13ank 040420417 300 , OO(
Torrey Pines Bank 040420462 500,00(
Torrey Pines Bank 040420463 750,00(
Valley Federal S&L 041-0302068 500 , OO(
Valley Federal S&L 041-0302215 300,00(
Western Federal S&L 26-1260015639 400 , OO(
Western Federal S&L 26-1260015712 2,200 , OO(
The Certificates of Deposit and/or Securities shown above are not presentlj
restricted by a previous pledge or assignment to any institution, nor by st
or municipal :Law, and are validly pledged as collateral for the note.
i i
CITY OF CARLSBAD
ROUTING SL'
ACTION TO BE TAKEN
[I FOR YOUR INFORMATION 0 PREPARE REFLY
Ci REVIEW AND COMMENT a SEE ME
TI INVESTIGATE & REPORT
0 SIGN AND RETURN
0 ADVISE YOUR PERSONNEL
CIRCULATE
., -
#,
0 w *
r, 1200 ELM AVENUE
(t CARLSBAD, CA 92008-1989
dirp of Carla'bab
FINANCE DEPARTMENT
May 8, 1987
San Diego Trust & Savings Bank
3150 El Camino Real
Carlsbad, CA 92008
PLEDGE OF CERTIFICATES OF DEPOSIT AND SECURITIES
The certificates of deposit and/or securities shown
on the attached list are not presently restricted
by a previous pledge or assignment to any institu-
tion.
/7
f' "" VI City d@d) Attorney I
80ND OR SHARE8 OR
OLPOSITED
- 5 CvJiG::;C PAR VALUL
DESCRIPTION Ofl ISSUE.. m
fktures 11-23-87 $40C ,000 1
?.iarnres 12-8-37 $2.200 ,COO 2
._ ikesrer~ Federal SLL Certificate of Deposit 626-1"6UU1 - 3,634
i;estern Federal S&L Certificate of Deposit i!26-1260015732
3.
4
5
6
7
8 /-,
I; INSTRUCTIONS FOR RETURN OF COLLATERAL .. A
AND DISPOSITION OF COUPONS
':L. 4:s DUPLICATE
-43 ) i "(! L ' ~ '1 p.'QFffCE (No ,
, ,.
.>, , .. I!/ / \- . BY TO VAULT: ENTERED IN REGISTER
BYpp- LOAN SECURITIES CUSTODIAN
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*
ASSIGNMENT OF DEPOSIT ACCOUNT
8
MEMBER FaLC
To secure and in consideration of such credit as has been or is granted hereafter and from,
time by SAN DIEGO TRUST 6 SAVINGS BANK, hereinafter referred to as the “Bank”,
undersigned or to any one or more of the undersigned if there be more than one, I/we assign
Bank Western Federal Savings and Loan
Account Number 26-1260015639 & 26-12f
now standing in the name of
including all amounts now or at any time hereafter deposited in that Account, and all interest
payable with respect to the Account.
At any time after default in the payment or performance of any credit obligation secured
Agreement, the Bank may, upon five (51 days’ notice to the undersigned, withdraw all or any pari
Account and apply its proceeds to payment of such obligation in whole or in part, whether or r
Account is payable without penalty for early withdrawal.
This is a Continuing Agreement which shall remain in full force until the branch of the Bank
the Account is maintained receives written notice that it has been revoked or written notice
death, incapacity or bankruptcy of the undersigned or any of them. Revocation shall be effect[\
after all credit secured hereby at the time the notice is received has been satisfied and shall apF
as to the credit extended after the receipt of such notice.
City of Carlsbad
, California
I19-
Carlsbad
May 29, 87
- /
CL 463 ‘REV 9/811
a w
).
ASSIGNMENT OF DEPOSIT ACCOUNT
8
To secure and in consideration of such credit as has been or is granted hereafter and from
time by SAN DIEGO TRUST 6. SAVINGS BANK, hereinafter referred to as the “Bank”,
undersigned or to any one or more of the undersigned if there be more than one, I/we assigr
Bank Valley Federal Savings and Loan
Account Number 041-0302068 & 041-031
now standing in the name of City of Carlsbad
including all amounts now or at any time hereafter deposited in that Account, and all interest
payable with respect to the Account.
At any time after default in the payment or performance of any credit obligation secured
Agreement, the Bank may, upon five (51 days’ notice to the undersigned, withdraw all or any par
Account and apply its proceeds to payment of such obligation in whole or in part, whether or I
Account is payable without penalty for early withdrawal.
This is a Continuing Agreement which shall remain in full force until the branch of the Bank
the Account is maintained receives written notice that it has been revoked or written notice
death, incapacity or bankruptcy of the undersigned or any of them. Revocation shall be effectil
after all credit secured hereby at the time the notice is received has been satisfied and shall apF
as to the credit extended after the receipt of such notice.
Carlsbad , California
May 29. ,I9 87
- / /
CL463 [REV 9/81]
m m
ASSIGNMENT OF DEPOSIT ACCOUNT
8
MEMBER ERLC
To secure and in consideration of such credit as has been or is granted hereafter and from t
time by SAN DIEGO TRUST & SAVINGS BANK, hereinafter referred to as the “Bank”,
undersigned or to any one or more of the undersigned if there be more than one, I/we assign
Bank Torrey Pines Bank
Account Number See List Below
now standing in the name of
including all amounts now or at any time hereafter deposited in that Account, and all interest F
payable with respect to the Account.
At any time after default in the payment or performance of any credit obligation secured t
Agreement, the Bank may, upon five (51 days’ notice to the undersigned, withdraw all or any part
Account and apply it5 proceeds to payment of such obligation in whole or in part, whether or n
Account is payable without penalty for early withdrawal.
This is a Continuing Agreement which shall remain in full force until the branch of the Bank \
the Account is maintained receives written notice that it has been revoked or written notice
death, incapacity or bankruptcy of the undersigned or any of them. Revocation shall be effectiv
after all credit secured hereby at the time the notice is received has been satisfied and shall app
as to the credit extended after the receipt of such notice.
City of Carlsbad
Carlsbad , California
May 29. ,1987
Matures 9-21-87 $1,000,000.00
DO40420418 11-16-87 200,000 .oo
#040420391 f 0 4 0 4 204 12 10-19-87 600,000 .OO
# 0 40 4 2 0 41 7 10-19-87 300,000.00
W040420462 1-5-88 500,000 .OO
a040420463 4-5-88 750,000 .OO
CL 463 [REV 9/81]
a 1)
CORPORATE RESOLUTIOM TO BORROW
Mt,WRF.OIC
Resolved, that this corporation City of Carlsbad
borrow from SAN DlEGO TRUST & SAVINGS BANK hereinafter called the “Bank,” from time to time, such sums of mo
judgment of the officer or officers hereinafter authorized, this corporation may require; provided that the aggregate arr
borrowing, pursuant to this resolution, shall not at any one time exceed the principal su pf Seven M’
[$ 7,459,384 .OO I, in addition to such amount or amounts as may have%!%$oi%?88&kk#$k6~%!
and such amounts as may hereafter be authorized by this corporation:
Resolved Further, that any 2 of the following named officers Specify Number
Claude Lewis the Mayor
Aletha L. Rautenkranz the. City Clerk
the
the
of this corporation (the officer or officers or officers acting in combination, authorized to act pursuant hereto being
designated as “authorized officers”), be and they are hereby authorized and empowered, for and on behalf and in r
corporation (1 I to execute and deliver to the Bank such notes or other evidences of indebtedness of this corporation for tt,
borrowed, with interest thereon, as the Bank may require, and to execute and deliver, from time to time, renewals,
or modifications of such notes or other evidences of indebtedness; (21 to grant a security interest in, transfer, or otherwi
cate ordeed in trust for Bank’s benefit and deliver by such instruments in writing or otherwise as may be demanded by tl
of the property of this corporation as may be required by the Bank to secure the payment of any notes or other indebted
corporation to the Bank, whether arising pursuant to this resolution or otherwise: and [31 to perform all acts and executc
all instruments which the, Bank may deem necessary to carry out the purposes of this resolution:
Resolved Further, that said authorized officers be and they are hereby authorized and empowered, and that any
authorized officers be and he is hereby authorized and empowered (1 I to discount with or sell to the Bank, conditional sales
notes, acceptances, drafts, bailment agreements, leases, receivables and evidences of indebtedness payable to this c
upon such terms as may be agreed upon by them and the Bank, and to endorse in the name of this corporation said not
ances, drafts, bailment agreements, leases, receivables and evidences of indebtedness so discounted, and to guarantee t,
of the same to the Bank, and (21 to apply for and obtain from the Bank letters of credit and in connection therewith to ex
agreements, applications, guarantees, indemnities and other financial undertakings as Bank may require;
Resolved Further, that this resolution will continue in full force and effect until the Bank shall receive official notice in N
this corporation of the revocation thereof by a resolution duly adopted by the Board of Directors of this corporation, ai
certification of the Secretary OF this corporation as to the signatures of the above named persons shall be binding on this c1 City Clerk - of the above named corporation, duly org
ex’isting under the laws of the State of California , do hereby certify that the foregoing is a fu
correct copy of a resolution of the Board of Directors of said corporation, duly and regularly passed and adopted at a me€
Board of Directors of said corporation which was duly and regularly called and held on thel.f!LMay of .&
19 85 , at which meeting a quorum of the Board of Directors of said corporation was at all times present ar
I further certify that said resolution is still in full force and effect and has not been amended or revoked, and that the
signatures appearing below are the signatures of the officers authorized to sign for this corporation by virtue of said r
IN WITNESS WHEREOF, I have hereunto set my hand as such&nd affixed the corporate seal of said corpor
.
I, Aletha L. Rautenkranz
Cit Clerk
Aday of Mrv ,19-. 87
-I - “I /
[Signature]
(Signature) d5cLJvK- 4Le)tha J-.-&! [SI t a@enkrgz /’ 4ijqEr
CL 350 (REV. 5/81)
1 Loan proceeds provided to you by.
0 Cash recelved
0 Check Initials Initials
0 Deposit to your account
Dollar Amount
$ 1
$ !
$ I
0
0
0
0
0
$ I
$ I
$ I
$ ! I
$ I
-_ 0 Insurance Companies
0 App aisers -&.+----- $ -;ikef /
ctcr 02J-. 0
0
0
$ 1
$ I .
$6 4$9 ;38d - I-
$ I
s I
i 5 I
0 Loan Fees
0
0
El
Total Prepaid Finance Charges
$ 1
$ I
$ I
$ I
I
I
$ I
I 1
__- -- __ __ - ------- ___---_______. - __ .* ** - .___.__ __ ______
?
Cust No
$ 6,459.384.00 NoteNo Name City of Carlsbad
Single Payment Note (Xrl& ad , California &V 29,
On DEMAND, or if no demand, then on July 13, 1987 , for value received. the undersign1
pay to the order of the SAN DlEGO TRUST& SAVINGS BANK at Its
the sum of Six Million Four Hundred Fifty Ninn
with interest payable Rrnahu&~ from date of disbursement at the rate of 7
per annum, but a minimum finance charge of $ 75.00
Carlsbad
shall be paid.
Should interest not be paid when due, the whole sum thereof shall. at holder’s option. become immediately due and payable If paym when due, the undersigned agrees to pay all costs of collection, including reasonable attorney’s fees Costs shall bear interest at th
herein Pnncipal and interest aw payable in lawful money of the United States. The obligations under this Note, if there IS more than
joint and several. Any married person signing this Note as an individual maker consents to the liability of his or herseparate propertyfc this Note. The makers, endorsers and guarantors of this Note hereby waive diligence, demand, presentment, protest and notice of nc consent to renewals and extensions of time at or after maturity hereof. The pleadlng of any statute of limitations as a defense to any ani
hereunder is hereby waived.
- “If *payment hereof is secured by a Deed of Trust on real pfoperty, the Deed of Trust contains the
In the-event of any sale, transfer, conveyance. or further encumbrance of the real property covered by this Deed of Trustor any part th
voluntary or involuntary, without the prior written consent of the BENEFICIARY. the entire balance of the principal and interest of thi
hereby shall, at the option of the BENEFICIARY hereof, be declared immediately due and payable“
“For any property or liability insurance written in connection with this loan. Borrower
obtained; sublect to Bank’s right to approve the insurer Such insurance may not b
lowing provision;- -
Carlsbad, Ca. 92008
CL 240 (REV 1 /E21
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