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2014-01 Revenue Bonds RESOLUTION 2014-01 RESOLUTION OF THE BOARD OF DIRECTORS OF THE ENCINITAS PUBLIC FINANCING AUTHORITY AUTHORIZING THE ISSUANCE OF ITS REVENUE BONDS IN THE ORIGINAL PRINCIPAL AMOUNT OF NOT TO EXCEED $13,500,000 IN CONNECTION WITH THE FINANCING OF THE ACQUISITION OF THE PACIFIC VIEW PROPERTY AND IMPROVEMENT OF LIFEGUARD FACILITIES AUTHORIZING AND DIRECTING EXECUTION OF AN INDENTURE OF TRUST, A LEASE AGREEMENT, AN AGENCY AGREEMENT, A PURCHASE AGREEMENT AND AUTHORIZING AN OFFICIAL STATEMENT AND OTHER OFFICIAL ACTIONS AND EXECUTION OF RELATED DOCUMENTS WHEREAS, the Encinitas Public Financing Authority (the "Authority") has been formed pursuant to a Joint Exercise of Powers Agreement by and among the City of Encinitas (the "City"), Cardiff Sanitation District, Encinitas Fire Protection District, Encinitas Sanitation District and the San Dieguito Water District and is authorized under said Agreement and under the laws of the State of California to finance the acquisition and construction of public capital improvements for the City; and WHEREAS, the City has requested the Authority to issue its bonds for the purpose of providing funds to enable the City to finance certain improvements of benefit to the City, specifically the costs of acquisition of a property known as the Pacific View Property and the construction of improvements to a lifeguard tower on Moonlight Beach (collectively, the "Project"); and WHEREAS, to provide such financing for the Project, the Authority proposes to issue its revenue bonds in an aggregate principal amount of not to exceed $13,500,000 under the provisions of Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of 26353 00011\9297373.3 the Government Code of the State of California (the "Act"), such Bonds may be issued as one or two series of tax-exempt bonds, or may be issued as Tax Exempt Series A Bonds and as Taxable Series B Bonds in such amounts as may be determined by the City as stated herein, and which are proposed to be payable from the revenues to be derived by the Authority from lease payments to be made by the City for the lease of certain facilities pursuant to a Lease Agreement relating to the financing of the Project, and the lease of the Leased Premises, defined below (the "Lease Agreement"); and WHEREAS, the City Council has determined that the City Community Center and Fire Station#5 should be the leased assets under the Lease Agreement (the "Leased Premises"), and WHEREAS, a portion of the proceeds of the Bonds will be deposited in the Acquisition and Construction Fund to be established pursuant to the Indenture of Trust which is hereinafter approved, and will be applied by the Authority and the City to the acquisition, construction and installation of the Project pursuant to an Agency Agreement between the Authority and the City; and WHEREAS, Stifel, Nicolaus & Company, Incorporated (the "Underwriter") has proposed to purchase and underwrite the Bonds and has presented to the Authority a form of Bond Purchase Contract for the Bonds, to be entered into among the Authority, the City and the Underwriter (the "Purchase Contract") and there is also presented the Authority with a proposed form of Official Statement describing the Bonds, to be used in connection with the marketing thereof by the Underwriter; and 2 26353 00011\9297373 3 WHEREAS, the Board of the Authority (the "Board") has duly considered such transactions and has determined that it approves said transactions in the public interests of the City and the Authority; NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the Board of Directors of the Encinitas Public Financing Authority as follows: SECTION 1 Findings and Determinations. (a) Pursuant to the Act, the Board hereby finds and determines that the issuance of the Bonds will result in savings in effective interest rates and bond underwriting costs and thereby result in significant public benefits within the contemplation of Section 6586 of the Act. (b) The Board finds and determines that the above recitals are true and correct and that the fair rental value of Leased Premises exceeds the present value of Lease Payments to be made under the Lease Agreement. (c) The Board finds that a negotiated sale with the Underwriter will result in time savings and sale effectiveness for the Bonds. SECTION 2 Issuance of Bonds. The Board hereby authorizes the issuance of the Bonds for the purpose of funding the Project under and pursuant to the Act, in the maximum original principal amount not to exceed $13,500,000 The Bonds may be issued as a single series of tax-exempt bonds, as two series of tax-exempt bonds, or in two series, as Tax-Exempt Series A Bonds and as Taxable Series B Bonds as directed by the Board at this meeting, provided that the proceeds of the Taxable Series B Bonds shall be sufficient to acquire the Pacific View Property and pay the costs of issuance thereof, upon the direction of this Board at this meeting, 3 26353 00011\9297373 3 and that the provisions of this Section 2 and Section 4 of this Resolution shall have been met on the date of sale. SECTION 3 Approval of Financing Documents. The Board hereby approves each of the following documents in substantially the respective forms on file with the Secretary, together with such additions thereto and changes therein as Bond Counsel shall deem necessary, desirable or appropriate, the execution of which by the Chairperson, the Vice Chairperson, the Executive Director, or the Treasurer (the "Authorized Officers") shall be conclusive evidence of the approval of any such additions and changes: (1) the Indenture of Trust relating to the issuance of the Bonds and to the Project, by and between MUFG Union Bank N A. (the "Trustee") and the Authority; (2) the Lease Agreement relating to the lease and sub-lease of the Leased Premises between the City and the Authority for the purpose of financing the Project; (3) the Agency Agreement by and between the City and the Authority; (4) the Purchase Contract by and among the Authority, the City and the Underwriter. The Authorized Officers are each hereby authorized and directed to execute, and the Secretary is hereby authorized and directed to attest and affix the seal of the Authority to, the final form of each of the foregoing documents and agreements for and in the name and on behalf of the Authority. The Board hereby authorizes the delivery and performance of each of the foregoing documents and agreements 4 26353 00011\9297373 3 SECTION 4 Sale of Bonds. The Board hereby approves the sale of the Bonds by the Authority by negotiation with the Underwriter, pursuant to the Purchase Contract in substantially the form on file with the Secretary, together with such additions thereto and changes therein as Bond Counsel shall deem necessary, desirable or appropriate, the execution of which by the Executive Director shall be conclusive evidence of the approval of any such additions and changes. The Authorized Officers are hereby authorized and directed to execute the final form of the Purchase Contract for and in the name and on behalf of the Authority upon the submission of an offer by the Underwriter to purchase the Bonds, which offer is consistent with the requirements of this Resolution. The amount of Underwriter's discount for any tax-exempt series of the Bonds shall be not more than 0.8% of the aggregate principal amount thereof, the amount of the Underwriter's discount for the Taxable Series B Bonds shall not be more than 0.8% of the aggregate principal amount thereof, the true interest cost to be represented by any tax-exempt bonds (taking into account any original issue discount or premium on the sale thereof) shall not exceed five percent (5.00%), and the true interest cost to be represented by the Taxable Series B Bonds (taking into account any original issue discount or premium on the sale thereof) shall not exceed six percent (6 00%). SECTION 5 Official Statement; Continuing Disclosure. The Board hereby approves the preparation of, and hereby authorizes the Executive Director or the Treasurer to deem final within the meaning of Rule 15c2-12 of the Securities and Exchange Commission except for permitted omissions, a preliminary form of Official Statement of the Bonds. The Executive Director or the Treasurer is hereby authorized to execute the final Official Statement in the name and on behalf of the Authority, including any modifications resulting from additions thereto and changes therein as Bond Counsel shall deem necessary, desirable or appropriate, with the 5 26353 00011\9297373 3 execution of the final Official Statement by the Chairperson to be conclusive evidence of the approval of any such additions and changes The Executive Director or the Treasurer is further authorized to sign on behalf of the Authority a continuing disclosure agreement with respect to the financing, in such form as may be approved by Bond Counsel. SECTION 6 Official Actions. The Authorized Officers, the Secretary, and any and all other officers of the Authority are hereby authorized and directed, for and in the name and on behalf of the Authority, to do any and all things and take any and all actions, including obtaining title insurance for the Leased Premises, obtaining a rating on the Bonds, and including execution and delivery of any and all assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and other documents, which they, or any of them, may deem necessary or advisable in connection with the issuance and sale of the Bonds. SECTION 7 Effective Date This Resolution shall take effect from and after the date of its passage and adoption. ADOPTED this 22nd day of October, 2014. tin spar, Chairman he imtas Public Financing Authority ATTEST Kat ollywood, Secretary of the Encinitas Public Financing Authority 6 26353 00011\9297373 3 CERTIFICATION I, Kathy Hollywood, Secretary of the Encinitas Public Financing Authority do hereby certify that the foregoing resolution was adopted by the Board of Directors of the Encinitas Public Financing Authority at a regular meeting thereof held on the 22nd day of October, 2014, by the following vote of the Board of Directors AYES: Barth, Kranz, Shaffer. NOES: Gaspar, Muir. ABSENT: None. ABSTAINED: None. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal this 22nd day of October, 2014. Kath ollywood, Secretary of the Encinitas Public Financing Authority (SEAL) 26353 00011\9297373.3