HomeMy WebLinkAbout2007-03-13; City Council; 18935; Golf course equipment lease financial guarantyCITY OF CARLSBAD - AGENDA BILL
AB#
MTG.
DEPT.
18,935
3/13/2007
Finance
Authorization to Enter into a Financial
Guaranty with California First National
Bank for Golf Course Equipment Lease
Payments
DEPT. HEA
CITY ATTY.
CITY MGR.
RECOMMENDED ACTION:
Authorize the City of Carlsbad, as a member of the Carlsbad Public Financing Authority
(CPFA), to enter into an agreement with California First National Bank to guarantee monthly
lease payments in the event that The Crossings at Carlsbad Golf Course is unable to make the
lease payments for the lease-purchase of golf course equipment.
ITEM EXPLANATION:
The CPFA is in the process of lease-purchasing equipment to operate The Crossings at
Carlsbad Golf Course. The CPFA is entering into an agreement with California First National
Bank to provide the lease-purchase financing for the equipment. An accompanying agenda bill
provides the detail of the equipment purchase and terms of the lease agreement.
The purpose of this agenda bill, is to provide California First Bank with a guarantee of payment,
should for any reason, The Crossings at Carlsbad Golf Course revenue is insufficient to cover
the monthly lease payments. The lease payments are expected to be $14,042.88 per month.
A Financial Guaranty, to be provided by California First National Bank, requires that the City of
Carlsbad approve the agreement as a member of the Carlsbad Public Financing Authority. The
City has not yet received the financial guaranty from California First National Bank. The
approval of the agreement is contingent upon the City Attorney accepting the form of the
agreement.
In December 2006, the Carlsbad Public Financing Authority issued bonds to help fund golf
course construction. In that transaction, the City of Carlsbad is also the financial guarantor for
the debt service payments if The Crossings at Carlsbad revenue is insufficient to cover those
payments.
FISCAL IMPACT:
If for any reason The Crossings at Carlsbad revenue is insufficient to cover the monthly
equipment lease payments, the City of Carlsbad, as a member of the Carlsbad Public Financing
Authority, would be responsible for those payments.
ENVIRONMENTAL IMPACT:
Pursuant to Public Resources Code section 21065 and CEQA Guidelines section 15738, this
action does not constitute a "project" within the meaning of CEQA and therefore, does not
require an environmental review.
DEPARTMENT CONTACT: Lisa Irvine 760-602-2430 lirvin@ci.carlsbad.ca.us
FOR CITY CLERKS USE ONL Y.
COUNCIL ACTION: APPROVED
DENIED
CONTINUED
WITHDRAWN
AMENDED
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CONTINUED TO DATE SPECIFIC D
CONTINUED TO DATE UNKNOWN D
RETURNED TO STAFF V"
OTHER -SEE MINUTES D
Page 2
EXHIBITS:
1. Resolution No. 2007-059 of the City Council of the City of Carlsbad, California,
authorizing the City to enter into a Financial Guaranty with California First National Bank for
golf course equipment lease payments.
ib;l)
1 RESOLUTION NO. 2007-059
2 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD, CALIFORNIA, AUTHORIZING THE CITY TO
3 ENTER INTO A FINANCIAL GUARANTY WITH
4 CALIFORNIA FIRST NATIONAL BANK FOR GOLF
COURSE EQUIPMENT LEASE PAYMENTS.
5
6 WHEREAS, the City of Carlsbad is a member agency of the Carlsbad Public
7 Financing Authority, Joint Powers Authority;
^ WHEREAS, the City of Carlsbad desires to provide a financial guarantee to
9 California First National Bank, as Lessor, for the monthly lease payments for the
10 equipment lease for The Crossings at Carlsbad Golf Course to be entered into by the
11
Authority, as Lessee, in the event that revenues from The Crossings at Carlsbad are
12
insufficient to make the monthly lease payments;
4 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
15 Carlsbad, California, as follows:
16 1. That the above recitations are true and correct.
17 2. That the Mayor of the City of Carlsbad is authorized to execute a Guaranty
18 for the benefit of California First National Bank, guaranteeing that the monthly
19
equipment lease payments will be made from the City's General Fund in the event that
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the Carlsbad Public Financing Authority is unable to make the required payments from
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revenues of The Crossings at Carlsbad Golf Course.
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23 3. That the Guaranty is in a form acceptable to the City Attorney.
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26 //
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1 PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council
2 of the City of Carlsbad on the day of.
3 2007, by the following vote:
4
AYES:
6
NOES:
7
ABSENT:
8
9
10
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CLAUDE A LEWIS, Mayor
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ATTEST:13
14
LORRAINE M. WOOD, City Clerk
16 (SEAL)
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All Receive - Agenda Item # PpA- ^ <5k
March 13, 2007 For Information of
THE CITY COUNCIL
CM
Date From CM Asst. CMTO: CITY MANAGER
VIA: Assistant City Manager
FROM: Finance Director
AGENDA BILL #22 - Golf Course Maintenance Equipment Lease Agreement
Agenda Bill #22 - Golf Course Maintenance Equipment Lease Agreement is scheduled
to be heard by the Carlsbad Public Financing Authority on March 13, 2007. There are
two proposed actions included in this Agenda Bill. The first is for the Board to authorize
the purchase of $749,877.24 worth of golf course maintenance equipment from Golf
Ventures West Incorporated. The second action is for the Board to enter into an
agreement with California First National Bank to provide lease-purchase financing for
the equipment, contingent upon the City Attorney reaching agreement with California
First National Bank on the transaction.
The City has been unsuccessful at reaching accord with California First National Bank
on the lease-purchase agreement and therefore we respectfully request that the lease-
purchase action be removed from consideration during the Carlsbad Public Financing
Authority Board meeting this evening. We request the Board adopt the resolution as
amended with the deletion of item number 3 - approval of the lease-purchase
agreement. We recommend that the purchase of the golf course equipment be
considered this evening since the equipment is necessary to help maintain the golf
course.
We will return to the Board with a recommendation for a lease-purchase agreement with
another vendor as soon as the agreement is successfully negotiated between the two
parties.
In addition, because we are no longer entering into an agreement with California First
National Bank, we also request that AB #18,935 - Financial Guaranty with California
First National Bank is pulled from the agenda.
Please contact me if you have any questions or need additional information regarding
this matter.
Thank you,
LISA IRVINE
Finance Director
c: City Attorney
City Clerk
Assistant City Attorney
IuSCSIEDWLE
MAR
CITYOCITYCL
13 2007
F CARLSBADERK'S OFFICE
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