HomeMy Public PortalAbout2019.117 (09-17-19) RESOLUTION NO. 2019.117
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD APPROVING
THE ISSUANCE BY THE LYNWOOD PUBLIC FINANCING AUTHORITY OF (I) NOT
PUBLIC FINANCING AUTHORITY LEASE
TO EXCEED $10,000,000 OF LYNWOOD P U
REVENUE REFUNDING BONDS, SERIES 2019A (FEDERALLY TAXABLE) AND (II)
NOT TO EXCEED $14,000,000 OF LYNWOOD PUBLIC FINANCING AUTHORITY
LEASE REVENUE BONDS, SERIES 2019B (TAX EXEMPT); APPROVING THE
EXECUTION AND DELIVERY OF VARIOUS RELATED DOCUMENTS IN
CONNECTION WITH THE OFFERING AND SALE OF SUCH BONDS; AND OTHER
MATTERS RELATED THERETO
WHEREAS, the Lynwood Public Financing Authority (the "Authority") was
established for the purpose, among others, of providing for the financing and refinancing
of public capital improvements for the City of Lynwood (the "City"); and
WHEREAS, the Authority has previously issued its Public Financing Authority
Lease Revenue Bonds, 2010 Series A (Civic Center Improvement Project), in the
aggregate principal amount of $8,985,000, of which $8,695,000 are currently
outstanding (the "Series 2010 Bonds"), the proceeds of which were used to finance and
refinance certain public capital improvements in the City; and
WHEREAS, in order to obtain certain interest rate savings, the City desires that
the Authority issue its Lease Revenue Refunding Bonds, Series 2019A (Federally
Taxable) (the "Series 2019A Bonds") to provide funds for the refunding of the Series
2010 Bonds on a federally taxable basis; and
WHEREAS, the City desires to finance certain park improvements within the
boundaries of the City (the "Improvements); and
WHEREAS, in order to provide funds to finance the Improvements, the City
desires that the Authority issue its Lease Revenue Bonds, Series 2019B (Tax-Exempt)
(the "Series 2019B Bonds" and together with the Series 2019A Bonds, the "Series 2019
Bonds"); and
WHEREAS, in connection with the issuance of the Series 2019 Bonds, the City
desires to approve the form and distribution of a preliminary official statement (the
"Preliminary Official Statement"); and
WHEREAS, the City also desires to approve in connection with the sale of the
Series 2019 Bonds, the form of Bond Purchase Agreement (the "Purchase Contract"),
among the Authority, the City and Raymond James & Associates, Inc. (the
"Underwriter"); and
WHEREAS, Senate Bill 450 (Chapter 625 of the 2017-2018 Session of the
California Legislature) ("SB 450") requires that the City obtain from an underwriter,
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financial advisor or private lender and disclose, prior to authorization of the issuance of
bonds with a term of greater than 13 months, good faith estimates of the following
information in a meeting open to the public: (a) the true interest cost of the bonds, (b)
the sum of all fees and charges paid to third parties with respect to the bonds, (c) the
amount of proceeds of the bonds expected to be received net of the fees and charges
paid to third parties and any reserves or capitalized interest paid or funded with
proceeds of the bonds, and (d) the sum total of all debt service payments on the bonds
calculated to the final maturity of the bonds plus the fees and charges paid to third
parties not paid with the proceeds of the bonds; and
WHEREAS, in compliance with SB 450, the City has obtained from Wolf & Co.,
as the City's municipal advisor, and the Underwriter, the required good faith estimates
and such estimates are disclosed and set forth on Exhibit A attached hereto; and
WHEREAS, Senate Bill 1029 ("SB 1029") was signed by the California Governor
on September 12, 2016, and places additional responsibilities on any issuer of public
debt including the adoption of debt management policies that meet certain criteria; and
WHEREAS, the City has represented that it is in compliance with the applicable
SB 1029 pre-issuance requirements and that it expects to comply with all post-issuance
requirements of SB 1029 applicable to the Series 2019A Bonds and the Series 2019B
Bonds; and
WHEREAS, as required by Section 6586.5 of the California Government Code,
the City has caused the publication of a notice of a public hearing on the financing of the
Improvements once at least five days prior to the hearing in a newspaper of general
circulation in the City; and
WHEREAS, the City held a public hearing at which all interested persons were
provided the opportunity to speak on the subject of financing the Improvements; and
WHEREAS, to fulfill the requirements of Rule 15c2-12 under the Securities
Exchange Act of 1934 (as amended, the "Rule"), the City will enter into a Continuing
Disclosure Agreement (the "Continuing Disclosure Agreement"), whereby the City will
agree to provide certain continuing disclosure reports; and
WHEREAS, there have been presented to this meeting the proposed forms of
the following documents:
(a) the Indenture, dated as of October 1, 2019 (the "Indenture"), among
the Authority, the City and U.S. Bank National Association, as trustee (the "Trustee");
(b) the Site Lease, dated as of October 1, 2019 (the "Site Lease")
between the City and the Authority;
(c) the Facility Lease, dated as of October 1, 2019 (the "Facility
Lease") between the City and the Authority;
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(d) the Escrow Agreement;
(e) the Preliminary Official Statement;
(f) the Purchase Contract;and
(g) the Continuing Disclosure Agreement;
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of
Lynwood, as follows:
Section 1. Findings and Determinations. The City hereby specifically finds and
declares that the actions authorized hereby constitute and are with respect to public
affairs of the City and that the statements, findings and determinations of the City set
forth above are true and correct and that the issuance of the Series 2019B Bonds by the
Authority will result in the following public benefits (i) demonstrable savings in effective
interest rate, bond underwriting, and bond issuance; (ii) employment benefits from
undertaking the projects in a timely fashion, and (iii) more efficient delivery of local
agency services to residential and commercial development.
Section 2. Approval of Issuance of Series 2019A Bonds by the Authority. The
issuance of the Series 2019A Bonds by the Authority on the terms and conditions set
forth in, and subject to the limitations specified in, the Indenture and this Resolution, is
hereby approved; provided, however, that (i) the aggregate principal amount of Series
2019A Bonds shall not exceed $10,000,000, (ii) the maturity of the Series 2019A Bonds
shall not exceed September 1, 2040 and (iii) there shall be present value savings with
respect to the refunding of the Series 2010 Bonds of at least 3.00% of the principal
amount of the Series 2010 Bonds being refunded, using the yield on the Series 2019A
Bonds as the discount rate.
Section 3. Approval of Issuance of Series 2019B Bonds by the Authority. The
issuance of the Series 2019B Bonds by the Authority on the terms and conditions set
forth in, and subject to the limitations specified in, the Indenture and this Resolution, is
hereby approved; provided, however, that (i) the aggregate principal amount of Series
2019B Bonds shall not exceed $14,000,000, (ii) the maturity of the Series 2019B Bonds
shall not exceed September 1, 2049, and (iii) the true interest cost of the Series 2019B
Bonds shall not exceed 5.50%.
Section 4. Approval of Indenture. The form of Indenture presented at this
meeting is hereby approved, and the City's Mayor, Mayor Pro Tern, City Manager or
Finance Director, or his or her designee (each, an "Authorized Officer") are each hereby
authorized and directed, for and in the name of and on behalf of the City, to execute,
acknowledge and deliver the Indenture in substantially the form presented at this
meeting with such changes therein as the officer executing the same may approve,
such approval to be conclusively evidenced by the execution and delivery thereof,
including with respect to whether and what type(s) of credit enhancement supports the
Bonds, or by other factors, as determined by the Authorized Officers in consultation with
the City's financial and legal consultants as being in the best interests of the City.
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Section 5. Approval of Site Lease. The form of Site Lease presented at this
meeting is hereby approved and each Authorized Officer is hereby authorized and
directed, for and in the name of and on behalf of the City, to execute, acknowledge and
deliver the Site Lease in substantially the form presented at this meeting with such
changes therein as the Authorized Officer executing the same may approve, such
approval to be conclusively evidenced by the execution and delivery thereof.
Section 6. Approval of Facility Lease. The form of Facility Lease presented at
this meeting is hereby approved and each Authorized Officer is hereby authorized and
directed, for and in the name of and on behalf of the City, to execute, acknowledge and
deliver the Facility Lease in substantially the form presented at this meeting with such
changes therein as the Authorized Officer executing the same may approve, such
approval to be conclusively evidenced by the execution and delivery thereof.
Section 7. Approval of Purchase Contract. The City is hereby authorized to
enter into the Purchase Contract and each Authorized Officer is hereby authorized and
directed to execute and deliver the Purchase Contract on behalf of the City, in
substantially the form presented to this meeting, with such changes therein, deletions
therefrom and additions thereto as the Authorized Officer shall approve in consultation
with the City's financial and legal consultants, which approval shall be conclusively
evidenced by the execution and delivery thereof; provided, that the underwriting
discount payable by the City pursuant to the Purchase Contract shall not exceed 0.75%
of the aggregate principal amount of the Series 2019 Bonds.
Section 8. Approval of Escrow Agreement. The form of Escrow Agreement
presented at this meeting are hereby approved and each Authorized Officer is hereby
authorized and directed, for and in the name of and on behalf of the City, to execute,
acknowledge and deliver the Escrow Agreement in substantially the form presented at
this meeting with such changes therein as the Authorized Officer executing the same
may approve, such approval to be conclusively evidenced by the execution and delivery
thereof.
Section 9. Approval of Official Statement. The Preliminary Official Statement is
hereby approved and the same may be used and is hereby authorized to be used and
distributed in the market by the Underwriter incident to the marketing of the Series 2019
Bonds. Each Authorized Officer is hereby authorized to (a) make such changes in such
form of the Preliminary Official Statement as such officer, in consultation with the City's
financial and legal consultants and the Underwriter, shall determine to be appropriate,
and (b) on behalf of the City, to deem such Preliminary Official Statement "final"
pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (the "Rule"). Each
Authorized Officer is authorized and directed to prepare a final Official Statement, with
such additional information as may be permitted to be excluded from the Preliminary
Official Statement pursuant to the Rule, which final Official Statement shall be executed
and delivered in the name and on behalf of the City by an Authorized Officer, and such
Authorized Officer is authorized and directed to prepare, execute and deliver in the
name and on behalf of the City any supplemental filings related to such final Official
Statement.
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Section 10. Approval of Continuing Disclosure Agreement. The form of
Continuing Disclosure Agreement presented at this meeting is hereby approved and
each Authorized Officer is hereby authorized and directed, for and in the name of and
on behalf of the City, to execute, acknowledge and deliver the Continuing Disclosure
Agreement in substantially the form presented at this meeting with such changes
therein as the Authorized Officer executing the same may approve, such approval to be
conclusively evidenced by the execution and delivery thereof.
Section 11. Approval of Legal and Financial Work on behalf of the City in
connection with the Proposed Issuance of Bonds. The City has requested the Authority
to issue the Series 2019A Bonds and the Series 2019B Bonds for the purpose of
refunding the Series 2010 Bonds and for the purpose of financing the Improvements,
respectively, as described herein, and in connection therewith the City approves legal
and financial work on behalf of the City, and authorizes the Director of Finance to
negotiate (i) an agreement to provide underwriting services with Raymond James &
Associates, Inc., (ii) an agreement to provide municipal advisory services with Wolf &
Co., and (iii) an agreement to provide bond disclosure counsel services with Nixon
Peabody LLP.
Section 12. Other Acts. The officers and staff of the City are hereby authorized
and directed, jointly and severally, to do any and all things, to execute and deliver any
and all documents, which in consultation with the City Attorney or with Nixon Peabody
LLP, as bond counsel, they may deem necessary or advisable in order to effectuate the
purposes of this Resolution, and any and all such actions previously taken by such
officers or staff members are hereby ratified and confirmed. Any one of the Authorized
Officers is hereby authorized and directed, for and in the name of and on behalf of the
City, to evaluate and select one or more municipal bond insurers for all or any portion of
the Series 2019A Bonds and the Series 2019B Bonds and to exeute and deliver such
contracts and agreements with such bond insurers as may be approved by the
Authorized Officer executing the same, subject to the provisions of this Resolution, such
approval to be conclusively evidenced by such execution and delivery.
Section 13. Effective Date. This Resolution shall take effect upon adoption
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PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council of the
City of Lynwood, California this 17th day of September 2019.
.L ra
Jos 1 uis Solache, rayor
ATTEST:
/
aria Quinonez,
City Clerk
APPROVED AS TO FORM: APPROVED AS TO CONTENT:
Noel Tapia, V Jose Ometeotl,
City Attorney City anager
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EXHIBIT A
GOOD FAITH ESTIMATES
The following information was obtained from the City's Municipal Advisor and the
Underwriter, and is provided in compliance with Section 5852.1 of the California
Government Code with respect to the base rental payments evidenced by the Series
2019A Bonds and the Series 2019B Bonds (collectively, the "Bonds"):
Series 2019A Bonds:
1. True Interest Cost of the Base Rental Payments Evidenced by the
Series 2019A Bonds. Assuming the estimated aggregate principal amount of the Series
2019A Bonds authorized to be issued by the Authority $8,505,000 is sold, and based on
market interest rates prevailing at the time of preparation of this information, a good
faith estimate of the true interest cost of the base rental payments evidenced by the
Series 2019A Bonds, which means the rate necessary to discount the amounts payable
on the respective principal and interest payment dates to the purchase price received
for the Series 2019A Bonds, is 3.0549%.
2. Finance Charge of the Series 2019A Bonds. Assuming the
estimated aggregate principal amount of the Series 2019A Bonds authorized to be
issued by the Authority $8,505,000 is sold, and based on market interest rates
prevailing at the time of preparation of this information, a good faith estimate of the
City's finance charge of the Series 2019A Bonds, which means the sum of all fees and
charges paid to third parties (or costs associated with the Series 2019A Bonds), is
$263,649.71.
3. Amount of Proceeds to be Received. Assuming the estimated
aggregate principal amount of the Series 2019A Bonds authorized to be issued by the
Authority $8,505,000 is sold, and based on market interest rates prevailing at the time of
preparation of this information, a good faith estimate of the amount of proceeds
expected to be received by the City following the Authority's sale of the Series 2019A
Bonds, less the finance charge of the Series 2019A Bonds described in paragraph 2
above and any reserves or capitalized interest paid or funded with proceeds of the
Series 2019A Bonds, is $8,241,350.29.
4. Total Payment Amount. Assuming the estimated aggregate
principal amount of the Series 2019A Bonds authorized to be issued by the Authority
$8,505,000 is sold, and based on market interest rates prevailing at the time of
preparation of this information, a good faith estimate of the total payment amount, which
means the sum total of all payments the City will make to pay base rental payments
evidenced by the Series 2019A Bonds plus the finance charge of the Series 2019A
Bonds described in paragraph 2 above not paid with the proceeds of the Series 2019A
Bonds, calculated to the final base rental payment evidenced by the Series 2019A
Bonds, is $11,182,590.25.
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4840-7178-2050.3
Series 2019B Bonds:
1. True Interest Cost of the Base Rental Payments Evidenced
by the Series 2019B Bonds. Assuming the estimated aggregate principal amount of the
Series 2019B Bonds authorized to be issued by the Authority $11,630,000 is sold, and
based on market interest rates prevailing at the time of preparation of this information, a
good faith estimate of the true interest cost of the base rental payments evidenced by
the Series 2019B Bonds, which means the rate necessary to discount the amounts
payable on the respective principal and interest payment dates to the purchase price
received for the Series 2019B Bonds, is 3.2353%.
2. Finance Charge of the Series 2019B Bonds. Assuming the
estimated aggregate principal amount of the Series 2019B Bonds authorized to be
issued by the Authority $11,630,000 is sold, and based on market interest rates
prevailing at the time of preparation of this information, a good faith estimate of the
City's finance charge of the Series 2019B Bonds, which means the sum of all fees and
charges paid to third parties (or costs associated with the Series 2019B Bonds), is
$413,360.76.
3. Amount of Proceeds to be Received. Assuming the estimated
aggregate principal amount of the Series 2019B Bonds authorized to be issued by the
Authority $11,630,000 is sold, and based on market interest rates prevailing at the time
of preparation of this information, a good faith estimate of the amount of proceeds
expected to be received by the City following the Authority's sale of the Series 2019B
Bonds, less the finance charge of the Series 2019B Bonds described in paragraph 2
above and any reserves or capitalized interest paid or funded with proceeds of the
Series 2019B Bonds, is $12,805,107.89.
4. Total Payment Amount. Assuming the estimated aggregate
principal amount of the Series 2019B Bonds authorized to be issued by the Authority
$11,630,000 is sold, and based on market interest rates prevailing at the time of
preparation of this information, a good faith estimate of the total payment amount, which
means the sum total of all payments the City will make to pay base rental payments
evidenced by the Series 2019B Bonds plus the finance charge of the Series 2019B
Bonds described in paragraph 2 above not paid with the proceeds of the Series 2019B
Bonds, calculated to the final base rental payment evidenced by the Series 2019B
Bonds, is $23,178,158.89.
The Bonds
Attention is directed to the fact that the foregoing information constitutes
good faith estimates only. The actual interest cost, finance charges, amount of proceeds
and total payment amount may vary from those presently estimated due to variations
from these estimates in the timing of the sale of the Bonds, the actual principal amount
of Bonds sold, the amortization of the Bonds sold and market interest rates at the time
of sale. The date of sale and the amount of Bonds sold will be determined by the City
based on need for improvement funds and other factors. The actual interest rates at
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4840-7178-2050.3
which the Bonds will be sold will depend on the bond market at the time of sale. The
actual amortization of the Bonds will also depend, in part, on market interest rates at the
time of sale. Market interest rates are affected by economic and other factors beyond
the City's control. The City Council has approved the execution and delivery of the
Facility Lease including the base rental payments evidenced by the Bonds with a
present value savings with respect to the refunding of the related refunded obligations in
the aggregate of at least 3.00% of the principal amount of the related refunded
obligations in the aggregate using the yield on the Bonds as the discount rate.
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4840-7178-2050.3
STATE OF CALIFORNIA )
) §
COUNTY OF LOS ANGELES )
I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the
above and foregoing resolution was duly adopted by the City Council of said City at its
regular meeting thereof held in the City Hall of the City on the 17th day of September,
2019 and passed by the following vote:
AYES: COUNCIL MEMBERS ALATORRE, CASANOVA, SANTANA, MAYOR
PRO TEM CASTRO, AND MAYOR SOLACHE
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE
/ Alf/.
Maria Quinonez,
City Clerkdir
STATE OF CALIFORNIA )
) §
COUNTY OF LOS ANGELES )
I, the undersigned City Clerk of the City of Lynwood, and Clerk of the City
Council of said City, do hereby certify that the above and foregoing is a full, true and
correct copy of Resolution No. 2019.117 on file in my office and that said resolution
was adopted on the date and by the vote therein stated. Dated this 17th day of
September, 2019.
I / i i ii,
aria a uinonez411,,
City Clerk
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