HomeMy WebLinkAbout2008-01-15; City Council; Resolution 2008-0111 RESOLUTION NO. 2008-011
2 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, AUTHORIZING AND PROVIDING FOR THE ISSUANCE
3 OF SPECIAL TAX BONDS FOR IMPROVEMENT AREA 2 OF
4 COMMUNITY FACILITIES DISTRICT NO. 3, APPROVING THE FORM
OF FISCAL AGENT AGREEMENT, PURCHASE CONTRACT,
5 PRELIMINARY OFFICIAL STATEMENT AND OTHER DOCUMENTS
RELATED THERETO AND AUTHORIZING CERTAIN ACTIONS IN
6 CONNECTION WITH THE ISSUANCE OF SUCH BONDS
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8 WHEREAS, the CITY COUNCIL of the CITY OF CARLSBAD, CALIFORNIA (this
9 "City Council"), did previously conduct proceedings to form and did form a community
10 facilities district and designate two improvement areas therein pursuant to the terms and
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provisions of the "Mello-Roos Community Facilities Act of 1982", being Chapter 2.5,
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Part 1, Division 2, Title 5 of the Government Code of the State of California (the "Act"),
such community facilities district designated as Community Facilities No. 3 (the
15 "Community Facilities District") and such improvement areas designated as
16 Improvement Area 1 and Improvement Area 2, respectively, for the purpose of financing
17 the acquisition or construction of certain public improvements; and,
18 WHEREAS, this City Council has previously declared its intention to issue bonds
19 for each Improvement Area of the Community Facilities District to finance the
20 acquisition or construction of such improvements, such bonds be issued pursuant to the
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terms and provisions of the Act and Policy 33 of the City Council pertaining to the use of
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Assessment Districts, Community Facilities Districts and Bridge and Thoroughfare
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Districts, as amended to date (the "Policy 33"); and,
25 WHEREAS, the City Council did previously authorize the issuance of bonds for
26 Improvement Area 1 and, on May 11, 2006, the City, acting for and on behalf of the
27 District, issued $11,340,000 principal amount of City of Carlsbad Community Facilities
28 District No. 3 2007 Special Tax Bonds (Improvement Area 1); and,
1 WHEREAS, at this time this City Council desires to set forth the general terms
2 and conditions relating to the authorization, issuance and administration of the Bonds
(defined below) for Improvement Area 2; and,
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WHEREAS, the forms of the following documents have been presented to and
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considered for approval by this City Council:
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A. Fiscal Agent Agreement by and between the Community Facilities District
7 and The Bank of New York Trust Company, N.A., as fiscal agent (the
"Fiscal Agent") setting forth the terms and conditions relating to the
^ issuance and sale of the Bonds (the "Fiscal Agent Agreement");
9 B. Purchase Contract authorizing the sale of the Bonds to Stone &
10 Youngberg LLC, the designated underwriter (the "Purchase Contract");
11 C. Preliminary Official Statement containing information including but not
limited to the Community Facilities District, Improvement Area 2 and the
12 Bonds, including the terms and conditions thereof (the "Preliminary Official
Statement"); and
14 D. Continuing Disclosure Certificate to be executed by the City pursuant to
which the City will be obligated to provide ongoing annual disclosure
15 relating to the Bonds (the "Continuing Disclosure Certificate"); and
16 WHEREAS, this City Council, with the aid of City staff, has reviewed and
17 considered the Fiscal Agent Agreement, the Purchase Contract, the Continuing
18 Disclosure Certificate and the Preliminary Official Statement and finds those documents
19 suitable for approval, subject to the conditions set forth in this resolution; and
20 WHEREAS, all conditions, things and acts required to exist, to have happened
21 and to have been performed precedent to and in the issuance of the Bonds as
22 contemplated by this resolution and the documents referred to herein exist, have
23 happened and have been performed or have been ordered to have been preformed in
24 due time, form and manner as required by the laws of the State of California, including
25 the Act and Policy 33.
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1 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CARLSBAD
2 HEREBY RESOLVES AS FOLLOWS:
3 1. Recitals. The above recitals are true and correct.
4 2. Determinations. This legislative body hereby makes the following
5 determinations pertaining to the proposed issuance of the Bonds:
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(a) Policy 33 generally requires that the full cash value of the properties within
7 Improvement Area 2 subject to the levy of the special taxes securing the
Bonds (the "Taxable Properties") must be at least 4 times the principal
amount of the Bonds, plus any prior or anticipated fixed assessment liens
9 and/or special tax liens (collectively, "Land Secured Indebtedness").
Policy 33 does, however, permit the City Council, in its sole discretion, to
10 accept a form of credit enhancement including the escrow of bond
proceeds to offset a deficiency in the required value to debt ratio as it
11 applies to the Taxable Property.
12 In order to determine the full cash value of the Taxable Properties the City
retained Bruce W. Hull & Associates (the "Appraiser"), a state certified real
13 estate appraiser, as defined in Business and Professions Code Section
11340(c) to undertake an appraisal of the Taxable Properties. The
Appraiser concluded that the aggregate full cash value of the Taxable
15 Properties as of November 10, 2007 was $63,974,000. Based upon the
proposed maximum principal amount of the Bonds, the full cash value of
16 the Taxable Property would be 3.19 times the Land Secured
Indebtedness.
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To offset the deficiency in the foregoing value to debt ratio, a portion of the
18 proceeds of the Bonds will, pursuant to the terms of the Fiscal Agent
Agreement, be deposited into an Escrow Fund so that the full tax value of
19 the Taxable Property will be 4 times the Land Secured Indebtedness when
2Q considering only the non-escrowed proceeds of the Bonds. Proceeds of
the Bonds deposited in the Escrow Fund will be permitted to be released
21 from the Escrow Fund and used for the purposes of the Bonds only if the
full tax value of all Taxable Property will be 4 times the Land Secured
22 Indebtedness when considering only the non-escrowed proceeds of the
Bonds following any such release. If any portion of the proceeds of the
23 Bonds deposited in the Escrow Fund is not released prior to the expiration
of the escrow period, such proceeds will be utilized to redeem Bonds and
24 thereby increase the value to debt ratio based upon the outstanding
principal amount of the Bonds following such redemption.
2fi The City Council determines that the proposed escrow structure will
adequately offset the deficiency in the existing value to debt ratio.
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1 (b) The terms and conditions of the Bonds as contained in the Fiscal Agent
Agreement are consistent with and conform to Policy 33.
- (c) As a result of the current status of development of the property within
Improvement Area 2 and the relative overall lack of diversity of ownership
4 of property therein, the private sale of the Bonds will result in a lower
overall cost to the owners of the Taxable Properties.
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6 3. Bonds Authorized. Pursuant to the Act, this Resolution and the Fiscal
7 Agent Agreement, limited obligation bonds of the City designated as "City of Carlsbad
g Community Facilities District No. 3 2008 Special Tax Bonds (Improvement Area 2)" (the
9 "Bonds") in an aggregate principal amount not to exceed $20,000,000 are hereby
10 authorized to be issued for and on behalf of Improvement Area 2. The date, manner of
11 payment, interest rate or rates, interest payment dates, denominations, form,
12 registration privileges, manner of execution, place of payment, terms of redemption and
13 other terms, covenants and conditions of the Bonds shall be as provided in the Fiscal
14 Agent Agreement as finally executed.
15 4. Authorization and Conditions. The City Manager, the Acting City
16 Manager, the Assistant City Manager, the Director of Finance and such other official or
17 officials of the City as may be designated in writing by this City Council, the City
13 Manager, or the Acting City Manager (each, an "Authorized Officer") are each hereby
19 authorized and directed to execute and deliver the final form of the various documents
20 and instruments described in this Resolution, with such additions thereto or changes
21 therein as such Authorized Officer may deem necessary and advisable provided that no
22 additions or changes shall authorize an aggregate principal amount of Bonds in excess
23 of $20,000,000, an annual interest rate on the Bonds in excess of seven percent (7.0%)
24 per year and underwriter's discount on the Bonds in excess of two percent (2.0%) of the
25 par amount of the Bonds (excluding original issue discount, if any). The approval of
26 such additions or changes shall be conclusively evidenced by the execution and
27 delivery of such documents or instruments by an Authorized Officer, upon consultation
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1 with and review by the City Attorney, Best Best & Krieger LLP, bond counsel, and/or
2 Jones Hall, A Professional Corporation, disclosure counsel, as applicable.
3 5. Fiscal Agent Agreement. The form of Fiscal Agent Agreement by and
4 between the City and the Fiscal Agent, with respect to the Bonds as presented to this
5 City Council and on file with the City Clerk, including each and every covenant
6 contained therein, is hereby approved. An Authorized Officer is hereby authorized and
7 directed to cause the same to be completed and executed on behalf of the City, subject
8 to the provisions of Section 3 above.
9 6. Official Statement and Continuing Disclosure Certificate. The City Council
10 hereby approves the form of the Preliminary Official Statement as presented to this City
11 Council and on file with the City Clerk, together with any changes therein or additions
12 thereto deemed advisable by the Director of Finance or, in the absence of the Director
13 of Finance, another Authorized Officer. Pursuant to Rule 15c2-12 under the Securities
14 Exchange Act of 1934 (the "Rule") the Director of Finance or, in the absence of the
15 Director of Finance, another Authorized Officer is authorized to determine when the
16 Preliminary Official Statement is deemed final, and the Director of Finance or such other
17 Authorized Official is hereby authorized and directed to provide written certification
18 thereof. The execution of the final Official Statement, which shall include such changes
19 and additions thereto deemed advisable by the Director of Finance or, in the absence of
20 the Director of Finance, another Authorized Officer pursuant to the Rule, shall be
21 conclusive evidence of the approval of the final Official Statement by the Community
22 Facilities District. The City Council hereby authorizes the distribution of the final Official
23 Statement by the Underwriter as the initial purchaser of the Bonds. The form of
24 Continuing Disclosure Certificate by and between the Community Facilities District and
25 the Dissemination Agent as presented to this City Council and on file with the City Clerk
26 is hereby approved. An Authorized Officer is hereby authorized and directed to cause
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1 the same to be completed and executed on behalf of the Community Facilities District,
2 subject to the provisions of Section 3 above.
3 7. Sale of Bonds. This City Council hereby authorizes and approves the
4 negotiated sale of the Bonds to the Underwriter. The form of the Purchase Contract is
5 hereby approved and an Authorized Officer is hereby authorized and directed to
6 execute the Purchase Contract on behalf of the Community Facilities District upon the
7 execution thereof by the Underwriter, subject to the provisions of Section 3 above.
8 8. Bonds Prepared and Delivered. Upon the execution of the Purchase
9 Contract, the Bonds shall be prepared, authenticated and delivered, all in accordance
10 with the applicable terms of the Act and the Fiscal Agent Agreement, and any
11 Authorized Officer and other responsible City officials, acting for and on behalf of the
12 Community Facilities District, are hereby authorized and directed to take such actions
13 as are required under the Purchase Contract and the Fiscal Agent Agreement to
14 complete all actions required to evidence the delivery of the Bonds upon the receipt of
15 the purchase price thereof from the Underwriter.
16 9. Actions. All actions heretofore taken by the officers and agents of the City
17 with respect to the establishment of the Community Facilities District and the sale and
18 issuance of the Bonds are hereby approved, confirmed and ratified, and the proper
19 officers of the City, acting for and on behalf of the Community Facilities District, are
20 hereby authorized and directed to do any and all things and take any and all actions and
21 execute any and all certificates, agreements, contracts, and other documents, which
22 they, or any of them, may deem necessary or advisable in order to consummate the
23 lawful issuance and delivery of the Bonds in accordance with the Act, this Resolution,
24 the Fiscal Agent Agreement, the Purchase Contract, the Continuing Disclosure
25 Certificate, and any certificate, agreement, contract, and other document described in
26 the documents herein approved.
27 10. Effective Date. This resolution shall take effect from and after its adoption.
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PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council
of the City of Carlsbad on the 15th day of January, 2008, by the following vote to wit:
AYES: Council Members Lewis, Kulchin, Hall, Packard and Nygaard.
NOES: None.
ABSENT: None.
ATTEST:
M. W00D, City