HomeMy WebLinkAboutAgenda Bill 5.B 08/18/2003CITY OF PETALUMA, CALIFORNIA
AGENDA SILL AUG 2003 04 P4®
Agenda Title
Meeting Date:
Resolution Authorizing the Issuance and the Sale of not to Exceed
August 18, 2003
$30,000,000 Principal Amount of Petaluma Community
Development Commission Petaluma Community Development
Meeting Time ® 3:00 PM
Project Tax Allocation Bond, Series 2003A; Authorizing the Sale of
❑ 7:00 PM
Such Bonds on Certain Terms and Conditions Pursuant to a
Competitive Sale; Approving Preparation and Distribution of the
Official Statement, Authorizing Certain Other Official Action in
Connection Therewith and Making Benefit Findings
Category (check one) ❑ Consent Calendar ❑ Public Hearing ® New Business
❑ Unfinished Business ❑ Presentation
Department
Director
Contact Person
Phone Number
Finance /Redevelop.
W. Thomas
W. Thomas
778 -4323
Cost of Proposal
Account Number
Not applicable
Not applicable
Amount Budgeted Not applicable
Name of Fund:
PCDC — Fund 902
Attachments to Agenda Packet Item
1. Resolution of the PCDC
2. Preliminary Official Statement, including form of Continuing Disclosure (draft)
3. Notice of Intention to Sell (draft)
4. Office Notice of Sale (draft)
5. Third Supplemental Indenture (draft)
Summary Statement
The Petaluma Community Development Commission (PCDC) wishes to issue bonds in an amount not
exceed $30,000,000 ($30 million) to finance various projects as described on Exhibit A to the Ordinance.
The action required by the City Council, sitting as the Redevelopment Agency, is to authorize the issuance
of these bonds based on specified terms and conditions pursuant to a competitive sale. The Commission is
also approving the preparation and distribution of the "Official Statement ", a draft of which is provided
with this Agenda Bill. The Commission is also authorizing certain other official actions in connection with
the sale including making benefit findings as detailed in the Resolution.
The actual amount of bonds will be determined based on the bonding capacity of the PCDC Project Area
by the financial consultant.
Recommended City Council Action /Suggested Motion
Adopt the Resolution.
Reviewed by Finance Director:
Reviewed by City Attorney
Date:
Approved /W Gitv Manager:
Date:
D e:
Today's Date
Revision # and Date Revised:
File Code:
August 13, 2003
#
CITY OF PETALUMA, CALIFORNIA
AUGUST 18, 2003
(Date of Meeting)
AGENDA REPORT
FOR
RESOLUTION AUTHORIZING THE ISSUANCE AND THE SALE OF NOT TO EXCEED $30,000,000 PRINCIPAL
AMOUNT OF PETALUMA COMMUNITY DEVELOPMENT COMMISSION PETALUMA COMMUNITY DEVELOPMENT
PROJECT TAX ALLOCATION BOND, SERIES 2003A; AUTHORIZING THE SALE OF SUCH BONDS ON CERTAIN
TERMS AND CONDITIONS PURSUANT TO A COMPETITIVE SALE; APPROVING PREPARATION AND
DISTRIBUTION OF THE OFFICIAL STATEMENT, AUTHORIZING CERTAIN OTHER OFFICIAL ACTION IN
CONNECTION THEREWITH AND MAKING BENEFIT FINDINGS
1. EXECUTIVE SUMMARY
The Petaluma Community Development Commission (PCDC) wishes to issue bonds in an amount not exceed
$30,000,000 ($30 million) to finance various projects as described on Exhibit A to the Ordinance. The action
required by the City Council, sitting as the Redevelopment Agency, is to authorize the issuance of these bonds
based on specified terms and conditions pursuant to a competitive sale. The Commission is also approving the
preparation and distribution of the "Official Statement ", a draft of which is provided with this Agenda Bill. The
Commission is also authorizing certain other official actions in connection with the sale including making
benefit findings as detailed in the Resolution.
The actual amount of bonds will be determined based on the bonding capacity of the PCDC Project Area by the
financial consultant.
2. BACKGROUND
The planning for the improvements to be financed with the proceeds of the bond issue has been underway for
the past two years. The improvements are designed to alleviate blighting conditions within the Project Area
and are consistent with the redevelopment plan for the Petaluma Community Development Project.
The improvements are as follows:
a. Water Street and Turning Basin River Walk ($7.7 million)
b. Downtown Streetscape Improvements ($5.75 million)
c. Central Petaluma Specific Plan Implementation/Theatre District ($7.4 million)
d. Parking Structure in CBD Project Area ($2.1 million)
e. Railroad Depot ($1.0 million)
f. Street Improvements ($7.0 million)
g. River Trail ($3.3 million)
h. Gateway Improvements ($1.0 million)
i. Land Acquisition (Kenilworth -- $4.0 million)
Total ............$39.25 million
Other than the Resolution, attachments #2 to #5, numbering 112 pages, are not included but are available at the
City Clerk's office. In an effort to reduce paper copies, we have not included these in the packet, but want to
reinforce the fact they are available to you and the public upon request.
3. ALTERNATIVES
The Council may decline to approve the financing at this time, and the capital improvements could be financed
at a later date, but at potentially higher interest rates, or on as a pay -as- you -go basis. If on a pay -as- you -go
basis, the scope and timing of the improvements would be adversely affected.
2
4. FINANCIAL IMPACTS
The Commission will be obligated to repay the principal of the bonds, plus interest at tax - exempt rates to be
determined by a competitive bid process. The principal amount of bonds authorized to be issued will not
exceed $30,000,000. The Fiscal Consultant's draft report indicates that projected tax increment revenues will
be sufficient to pay debt service on the proposed bond issue, based on an assumed Project Area assessed
valuation growth rate of 2% per year.
5. CONCLUSION
The issuance of bonds by the Commission to finance capital improvements within and in the vicinity of the
Project Area will allow for these projects to be financed on a current basis at tax - exempt interest rates. The
improvements are designed to promote the economic vitality of the Project Area and improve synergies
between the Project Area and the Central Business District that support economic growth in the Project Area.
6. OUTCOMES OR PERFORMANCE MEASUREMENTS THAT WILL IDENTIFY SUCCESS OR COMPLETION:
The issuance of bonds by the Commission will depend on the results of the competitive bidding process. If a
bid complying with the terms that will be established by the Commission in the Official Notice of Sale to
bidders is received which produces a true interest cost on the bonds not to exceed 7.5% per annum, the
Commission will be authorized to accept that bid. If any bid is accepted, it will be the bid that produces the
lowest true interest cost to the Commission.
7. RECOMMENDATION
Approve the issuance of bonds by the Commission in an amount not to exceed $30,000,000 in tax allocation
bonds for the purpose of financing certain public improvements.
g: /forms /2003 agenda bill
RE SO. # 2003-
RESOLUTION AUTHORIZING THE ISSUANCE AND THE SALE OF NOT TO
EXCEED $30,000,000 PRINCIPAL AMOUNT OF PETALUMA COMMUNITY
DEVELOPMENT COMMISSION PETALUMA COMMUNITY DEVELOPMENT
PROJECT TAX ALLOCATION BONDS, SERIES 2003A; AUTHORIZING THE SALE
OF SUCH BONDS ON CERTAIN TERMS AND CONDITIONS PURSUANT TO A
COMPETITIVE SALE; APPROVING PREPARATION AND DISTRIBUTION OF THE
OFFICIAL STATEMENT, AUTHORIZING CERTAIN OTHER OFFICIAL ACTION
IN CONNECTION THEREWITH AND MAKING BENEFIT FINDINGS
WHEREAS, the Petaluma Community Development Commission (the
"Commission ") is a redevelopment agency duly created, established and authorized to transact
business and exercise its powers, all under and pursuant to the Community Redevelopment Law,
being Section 33000 and following of the Health and Safety Code of the State of California (the
"Law"), and the powers of the Commission include the power to issue bonds for any of its
corporate purposes; and
WHEREAS, a redevelopment plan, known as the Redevelopment Plan for the
Petaluma Community Development Project (the "Plan "), has been adopted and approved in
accordance with the Law, and
WHEREAS, the Plan provides that the Commission is specifically authorized to
provide for the financing and refinancing of certain public improvements consistent with the Plan
for the Petaluma Community Development Project (the "Project "); and
WHEREAS, the Commission has previously issued its Petaluma Community
Development Project Tax Allocation Bonds, Series 1992A pursuant to an indenture, dated as of
January 1, 1992 (the "Indenture "); and
WHEREAS, the Commission has previously, issued its Petaluma. Community
Development Project Tax Allocation Bonds, Series 2000A pursuant to the Indenture and a first
supplemental indenture, dated as of June 1, 2000; and
WHEREAS, the Comrission has previously issued its Petaluma Community
Development Project. Refunding Tax Allocation Bonds, Series 2001A pursuant to the Indenture and
a second supplemental indenture, dated as of June 1, 2001; and
WHEREAS, the Indenture permits the issuance of Additional Bonds (as defined
therein) pursuant to supplemental indentures; and
WHEREAS, the Commission has determined to issue not to exceed $30,000,000
aggregate principal amount of its Petaluma Community Development Project Tax Allocation Bonds,
Series 2003A (the "Series 2003A Bonds ") for the purposes of (i) financing and refinancing the
Project, (ii) funding a bond reserve account and (iii) paying the costs of issuing the Series 2003A
Bonds; and
WHEREAS, in accordance with Section 33445 of. the Law and for the reasons and
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DOCSSFI :687432.3
based on the information set forth in Exhibit A hereto and presented. to this Commission at this
meeting, this Commission has determined that the use of the proceeds of the Bonds to finance the
Project uncl g �v g Exhibit 'A, are of benefit to the project area
udun the capital improvements described in
for the Project the Pro Area or the immediate nei ghborhood in which such imp rovements
will be located and no other reasonable means of financing such improvements are available to the
Commission or otherwise, and the payment of funds for such improvements will assist in the
elimination of one or more of the blighting conditions inside the Project Area; and
WHEREAS, there has been presented at this meeting a form of Third Supplemental
Indenture providing for the issuance of the Series 2003A Bonds; and
WHEREAS, the Commission has determined that it is desirable sell the Series
2003A Bonds by a competitive sale;
NOW, THEREFORE, BE IT RESOLVED by the Petaluma Community
Development Commission, as follows:
Section 1 . The Commission will proceed with the issuance and sale of not to
exceed $30,000,000 aggregate principal amount of Petaluma. Community Development Commission
Petaluma Community Development Project Tax Allocation Bonds, Series 2003A in order to finance
and refinance the Project. The Series 2003A Bonds are authorized to be executed by the manual or
facsimile signature of the Chairperson of the Commission and the seal of the Commission, is
authorized to be affixed or imprinted thereon and attested by the manual or facsimile signature of
the Secretary of the Commission. The seal of the Commission may be produced in facsimile form.
The Series 2003A Bonds, when so executed, are authorized to be delivered to the Trustee for
authentication.
Section 2 . The form of Third Supplemental Indenture, dated as of September 1,
2003 (the "Third Supplemental Indenture "), presented at this meeting, is hereby approved, and the
Chairperson or Vice Chairperson or the Executive Director and the Secretary are hereby authorized
and directed, for and in the name of and on behalf of the Commission, to execute, acknowledge and
deliver the Third Supplemental Indenture in substantially the form presented at this meeting with
such changes therein as the officers executing the same may approve, such approval to be
conclusively evidenced by the execution and delivery thereof. The date, maturity date or dates,
interest rate or rates, interest payment dates, terms of redemption and other terms of the Series
2003A Bonds shall be as provided in the Third Supplemental Indenture as finally executed.
Section 3 . The financial advisor of the Commission, Kelling, Northcross &
Nobriga (the "Financial Advisor "), will receive proposals for the purchase of the Series 2003A
Bonds by competitive sale, an&the Executive Director or the Treasurer or the designee of either are
hereby authorized and directed to select the bidder submitting a bid to purchase the Series 2003A
Bonds that provides the lowest true interest cost for the Series 2003A Bonds; provided that the true
interest cost of the Series 2003A Bonds shall not be in excess of 7.5% per annum.
Section 4 . The principal amount of Series 2003A Bonds to be sold shall be
established by the Executive Director or the Treasurer, in consultation with the Financial Advisor,
but shall not exceed $30,000,000.
Section 5 . The Commission authorizes the preparation of a notice of intention
to sell the Series 2003A Bonds. Said notice shall be substantially in the form presented to this
PESO. 03- PAGE 2 of 4
DOCSSF I :687432.3
meeting, with such changes, additions and completions therein as the Executive Director or
Treasurer of the designee of either may approve with the advice of counsel. When the form of said
notice of intention to sell have been approved by the Executive Director or the Treasurer or the
designee or either, the Financial Advisor is authorized to arrange for publication of said notice in
such financial publications as are desirable to notify potential bidders of the sale of the Series 2003A
Bonds, the cost of printing of said notice to be borne by the Commission but reimbursable from
Series 2003A Bond proceeds.
Section 6 . The Commission authorizes an official statement and an official
notice of sale relating to the Series 2003A Bonds to be prepared by Orrick, Herrington & Sutcliffe
LLP, as disclosure counsel and bond counsel. Said official statement and official notice of sale shall
be substantially in the form presented to this meeting, with such changes, additions and completions
therein as the Executive Director or the Treasurer or the designee or either may approve with the
advice of counsel. When the form of said official statement and official notice of sale have been
approved by the Executive Director or the Treasurer or the designee or either, the Executive
Director or the Treasurer or the designee of either may authorize the distribution of said official
statement and official notice of sale, the cost of printing and mailing said official statement and
official notice of sale to be borne by the Commission but reimbursable from Series 2003A Bond
proceeds.
Section 7 . The Chairman, the Executive Director, the Treasurer, the Secretary
and the Commission General Counsel are each hereby authorized and directed in the name and on
behalf of the Commission to take any and all steps and to issue and deliver any and all certificates,
requisitions, agreements, notices, consents, and other documents, which they are any of them might
deem necessary or appropriate in order to obtain credit ratings for the Series 2003A Bonds, to
obtain bond insurance for the Series 2003A Bonds if such insurance is deemed to be in the financial
interest of the Commission as determined by the Executive Director or the Treasurer or the
designee of either in consultation with the Financial Advisor, and to consummate the lawful
issuance, sale and delivery of said Series 2003A Bonds.
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DOCSSF1:687432.3
Section -8. The Commission hereby adopts as findings of benefit the
information contained in Exhibit A, attached hereto and incorporated herein, pursuant to Section
33445 of the Health and Safety Code.
Section 9. This resolution shall take effect from and after its passage and
approval.
Commissioner
ADOPTED this _th day of August, 2003, by the following vote:
Aye No
Chairperson
ATTEST:
Recording Secretary
Absent
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DOCSSF 1:687432.3
EXEIIBIT A
Central Business District Projects
Funded by Petaluma Community Development Project Bond Issue
Project 1:Water Street & Turning Basin River Walk ($7.7' Mon
The project will involve constructing a bicycle /pedestrian walkway along the river in the historic
downtown area. Water Street will be constructed so that utilities are undergrounded, parking is
pulled back from the river's edge so that a pathway can be built. The pathway will allow people to
walk down the river through the Petaluma Community Development ( "PCD ") project area.
The project will involve installing historic -type streetlighting, benches, trees, bike wracks, sidewalks,
and street paving. This will occur as a first phase along Petaluma Blvd and Kentucky Street -
typically called the historic downtown.
Project 3: Central Petaluma Specific Plan Implementation /Theater District ($7.4 Million)
The project will involve the development of public infrastructure over a 5 -block area resulting in a
mixed use development project of $75 million.
Project 4: Parking Structure in CBD;Project Area ($2.1;Million)
Funds will be contributed for the construction of a public /private parking garage in the Central
Business District Area
Project 5: Railroad Depot ($1.0 Million)
The project involves the rehab of 8,200 square feet of space outside and inside the three Depot
buildings.
Main Benefits to PCD Project Area:
® Traffic Reduction/ Circulation Improvements: The projects link PCD Project Area with the
downtown CBC project area (People who normally drive downtown will be able to walk or
ride their bikes. This traffic congestion in both the PCD project area and in the
CBD downtown.)
® Enhanced Economy: With the project improvements, the businesses located on Water
Street will be able to turn their businesses toward the river. Right now, Water Street is an
ugly parking lot. The improvements will allow the businesses to "double load" with
restaurants on Water Street and retail establishments facing Petaluma;Blvd. This will create
economic vitality that will benefit businesses located in the PCD project area since so many
are interdependent in serving downtown businesses. The streetscape:improvements in the
downtown will attract more residents and visitors alike to a clean charming district.
® Sales Leakage: By creating a vibrant and attractive downtown, the Citywill prevent residents
from leaving town to spend discretionary recreational funds. In this way, funds maintained
downtown can be recirculated to other businesses in the PCD project area.
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DOCSSFI:687432.3
• Economic Interdependence of CBD and P® project areas: Both areas have businesses
that are interdependent. For example, services businesses renting office or commercial
space in the PCD project area depend on successful thriving businesses in the downtown
CBD for their livelihood. These include accountants, pluiribers, attorneys, suppliers and
insurance brokers.
• Jobs: The project will bring additional jobs due to the economic expansion resulting from
the double loading of buildings and from longer store hours.
• Sense of Place: The project will enhance the downtown ambiance and create a vital center
of civic and social life. The PCD Project Area is the gateway to this center and will thrive in
support of the downtown. Many businesses that choose, to locate in Petaluma, do so for its
ambiance and sense of identity. This in turn gives them their corporate identity. This is
particularly true among high -tech industries located in the PCD project area.
• The River is a Key Identifier: Work along the Petaluma River will enhance the River as an
important key attribute that gives the rest of the City its identity. 'The PCD project area
depends on a strong Petaluma identity.
• Depot is the Gateway: The Depot side is across the street from the P® project area and
serves as an important gateway to the historic downtown CBD. It will provide recreational
space to the entire community— both the PCD and CBD through a conference center
located in the freight building. The smaller depot building will likely house the Petaluma
Visitors Bureau — which serves the entire community and is the main instrument for
attracting visitors to the community. People will come to the Bureau for literature on the
community as well as use the public restrooms.
• Tourism: Improvements along the River and downtown will attract residents from the PCD
Project Area and other areas outside the CBD. They will also, attract tourists who willspend
money in both the PCD and CBD Project areas and will chose to stay in hotels located in
the PCD project area.
DOCSSFI :687432.3
RESO.03-