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HomeMy WebLinkAboutRDA Agenda Packet 110904• • CITY OFATASCADERO COMMUNITY REDEVELOPMENT AGENCY AGENDA Tuesday, November 9, 2004 6:30 P.M. Atascadero Lake Pavilion 9315 Pismo St. Atascadero, California ROLL CALL: Chairperson O'Malley Vice Chairperson Pacas Board Member Luna Board Member Clay Board Member Scalise APPROVAL OF AGENDA: Roll Call COMMUNITY FORUM: BOARD ANNOUNCEMENTS AND REPORTS: (On their own initiative, the Board Members may make a brief announcement or a brief report on their own activities. Board Members may ask a question for clarification, make a referral to staff or take action to have staff place a matter of business on a future agenda. The Board may take action on items listed on the Agenda.) A. CONSENT CALENDAR: 1. Community Redevelopment Agency Minutes — October 12, 2004 ■ Board Secretary Recommendation: Board approve the Community Redevelopment Agency minutes of October 12, 2004. [Board Secretary] 1 B. MANAGEMENT: 1. Issuance of Redevelopment Bonds • ■ Fiscal Impact: An estimated $12,675,000 in bond proceeds and an estimated $21,810,000 in related debt service costs over 30 years. ■ Recommendations: Agency Board: 1. Adopt the draft Resolution authorizing the execution of a joint exercise of powers agreement creating the Atascadero Public Financing Authority and; 2. Adopt the draft Resolution authorizing the issuance and sale of tax allocation bonds to finance redevelopment activities within and for the benefit of the Agency's Atascadero Redevelopment Project and approving related documents and actions. [Treasurer] C. EXECUTIVE DIRECTOR REPORT: Wade McKinney, Executive Director D. ADJOURNMENT 2 is ITEM NUMBER: A-1 DATE: 11/09/2004 1918 9 El �ildll� CITY OF A TASCADERO COMMUNITY REDEVELOPMENT AGENCY DRAFT MINUTES TUESDAY, October 12, 2004 6:30 P.M. Chairperson O'Malley called the meeting to order at 6:31 p.m. ROLL CALL: Present: Board Members Clay, Luna, Scalise Pacas and Chairperson O'Malley Absent: None Others Present: Board Secretary Marcia McClure Torgerson, Recording Secretary Grace Pucci Staff Present: Executive Director Wade McKinney, Assistant City Manager Jim Lewis, Board Treasurer Rachelle Rickard, Public Works Director Steve Kahn, Community Development Director Warren Frace, Police Chief John Couch, Fire Chief Kurt Stone, Deputy Community Development Director Steve McHarris, Deputy Public Works Director Geoff English, Redevelopment Specialist Marty Tracey, and Interim City Attorney Tom Gibson. APPROVAL OF AGENDA: MOTION: By Board Member Luna and seconded by Board Member Clay to approve the agenda. Motion passed 5:0 by a roll -call vote. COMMUNITY FORUM: None RDA Draft Minutes 10/12/04 Page 1 of 3 ig BOARD ANNOUNCEMENTS AND REPORTS: None A. CONSENT CALENDAR: 1. Community Redevelopment Agency Minutes — September 14, 2004 ■ Board Secretary recommendation: Board approve the Community Redevelopment Agency minutes of September 14, 2004. [Board Secretary] MOTION: By Board Member Luna and seconded by Board Member Scalise to approve Item #A-1. Motion passed 5:0 by a voice vote. B. MANAGEMENT: 1. Bond Finance Team ■ Fiscal Impact: Costs are included in the financing. ■ Staff Recommendation: Board Authorize City Manager to execute agreements with Piper Jaffray and Quint & Thimming for financial and legal assistance for a Redevelopment Agency Tax Increment Bond. [Executive Director] Executive Director Wade McKinney gave the staff report and answered questions of the Board. Mark Curran, Piper Jaffray, reported on his findings and answered questions of the Board. MOTION: By Board Member Luna and seconded by Board Member Clay to authorize the City Manager to execute agreements with Piper Jaffray and Quint & Thimming for financial and legal assistance for a Redevelopment Agency Tax Increment Bond. Motion passed 5:0 by a roll -call vote. (Agreement Nos. RA003- 2004 and RA004-2004) Chairperson O'Malley recessed the hearing at 6:40 p.m. Chairperson O'Malley called the meeting back to order at 1:24 p.m. RDA Draft Minutes 10/12/04 Page 2 of 3 M 2. Purchase of Parcel 3 of Parcel Map 85-225 (Generally known as Creekside Lanes) ■ Fiscal Impact: Expense in the amount of $1,300,000. ■ Staff Recommendation: Agency Board approve Resolution approving Purchase Agreement with Creekside Parcel Associates for the purchase of Parcel 3 of Parcel Map 85-225 (generally known as Creekside Lanes) for the purchase price of $1,300,000, and authorize the purchase to be included in the upcoming Agency financing. [Executive Director] Vice Chairperson Pacas stepped down from consideration of this item as she is employed within 500 feet of the site. (Exhibit A) MOTION: By Board Member Scalise and seconded by Board Member Clay to authorize the purchase. Motion passed 3:1 by a roll -call vote. (Luna opposed) (Resolution No. RA2004-002) C. EXECUTIVE DIRECTOR REPORT: Wade McKinney, Executive Director None D. ADJOURNMENT Chairperson O'Malley adjourned the meeting at 1:25 a.m. MEETING RECORDED AND MINUTES PREPARED BY: Grace Pucci, Recording Secretary The following exhibit is available for review in the City Clerk's office: Exhibit A — Vice Chairperson Pacas, Statement of Abstention RDA Draft Minutes 10/12/04 Page 3of3 5 ITEM NUMBER: B -1 DATE: 11/09/2004 Community Redevelopment Agency of Atascadero Staff Report - Treasurer Issuance of Redevelopment Bonds RECOMMENDATIONS: Agency Board: 1. Adopt the draft Resolution authorizing the execution of a joint exercise of powers agreement creating the Atascadero Public Financing Authority and; 2. Adopt the draft Resolution authorizing the issuance and sale of tax allocation bonds to finance redevelopment activities within and for the benefit of the Agency's Atascadero Redevelopment Project and approving related documents and actions. DISCUSSION: In July of 1999, the Community Redevelopment Agency of Atascadero (Agency) adopted their Redevelopment Plan for economic enhancement in the Project area. By design, the major source of revenue for Redevelopment Agencies is Tax Increment. Tax Increment is the increase in property taxes over a base year as a result of economic enhancement in the Redevelopment Project Area. Legislation is written such that Redevelopment Agencies must incur debt to qualify for increment. The Community Redevelopment Agency of Atascadero did just that, beginning with a series of loans from the City's general fund, which were invested to enhance the Project Area. The Agency now seeks to conduct a financing to secure funds allowing the Agency to build projects implementing the Redevelopment Plan. The debt will be secured solely by Agency tax increment revenue, and thus, the City is not liable for repayment on the debt, nor does it increase taxes. Historically, the default rate on Redevelopment bonds 0 ITEM NUMBER: B - 1 DATE: 11/09/2004 is well under 1 /100th of 1%. This type of long-term debt instrument is viewed by the Municipal Bond Market as a solid investment with a strong track record. In order to issue bonds, the Agency must adopt two resolutions. The first resolution creates a joint exercise of powers authority with the City. The creation of this authority allows the bonds to be sold using current sales procedures which facilitates the marketing of the bonds. The second resolution authorizes the issuance and sale of tax allocation bonds by the Agency in an amount not exceed $14,000,000. It also authorizes the execution and delivery by the Agency of the following documents: 1. Indenture- This is the primary document for the Bonds and sets forth all of the mechanics of the issuance of the Bonds, the application of proceeds and the collection of tax increment revenues for payment to bondholders. 2. Bond Purchase Agreement- Under this document, the Agency agrees to sell the bonds to the Authority, for immediate re -sale to Piper Jaffray, Inc., the underwriter, for sale to its clients and other investors. The Bonds will be sold to the underwriter at a price not less than 99% of the par amount thereof. 3. Official Statement This is the principal offering document for the Bonds providing information about the Agency, the Project Area, the City , the Bonds and the security payment of the Bonds so that the prospective investors can make an informed investment decision about the Bonds. Drafts of these documents are available for review in the City Clerk's office. Attached to this report is a letter from Mark Curran, Managing Director, Public Finance for Piper Jaffray. The letter updates the progress made on the financing, outlines the mechanism to be used in implementing the financing, and further explains the need to create the Financing Authority. Conclusion: The Community Redevelopment Agency will be at a great advantage by borrowing against future revenues to make a large investment into the Project Area today especially because of the lower interest rates. Since the debt instrument is secured solely by redevelopment tax increment, there is no risk or liability to the City. Additionally, the indebtedness of the Agency will qualify it to receive the tax increment. FISCAL IMPACT: An estimated $12,675,000 in bond proceeds and an estimated $21,810,000 in related debt service costs over 30 years. ALTERNATIVES: 1. Don't approve financing, staff does not recommend this due to loss of future tax increment and loss of capital funding for projects. 7 ITEM NUMBER: B - 1 DATE: 11/09/2004 2. Approve bonds in a lesser amount. Staff does not recommend this because taking advantage of the lower interest rates teamed with the project list shows that the Agency could successfully spend the money in the three year program on priority projects. ATTACHMENTS: 1. Draft Resolutions 2. Letter from Piper Jaffray DRAFT RESOLUTION RESOLUTION OF THE BOARD OF DIRECTORS OF THE ATASCADERO COMMUNITY REDEVELOPMENT AGENCY AUTHORIZING THE EXECUTION OF A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE ATASCADERO PUBLIC FINANCING AUTHORITY WHEREAS, the Atascadero Community Redevelopment Agency (the "Agency") and the City of Atascadero (the "City"), desire pursuant to Articles 1 through 4 (commencing with section 6500) of Chapter 5, Division 7, Title 1 of the California Government Code, to create a joint exercise of powers authority to assist in exercising powers common to the City and the Agency, to undertake the financing of public capital improvements and related capital requirements for themselves and for other public entities within the State of California; NOW, THEREFORE BE IT RESOLVED, by the Board of Directors of the Atascadero Community Redevelopment Agency SECTION 1. Formation of Joint Powers Authority. The appropriate officers and staff members of the Agency are authorized to assist in the organization of a joint powers authority between the City and the Agency, to be known as the "Atascadero Public Financing Authority" (the "Authority"). The Agency hereby authorizes the Executive Director or the Executive Director's designee to execute, and the Secretary to attest, a joint exercise of powers agreement forming the Authority, in substantially the form on file with the Secretary, together with any changes therein deemed advisable by counsel to the Agency. SECTION 2. Authority Directors. The Board hereby designates all members of the City Council of the City as directors of the Authority. SECTION 3. Official Actions. The Executive Director, the Treasurer and all other proper officers of the Agency are hereby authorized and directed to take all actions and do all things necessary or desirable hereunder with respect to the formation of the Authority, including but not limited to the execution and delivery of any and all agreements, certificates, instruments and other documents, which they, or any of them, may deem necessary or desirable and not inconsistent with the purposes of this resolution. On motion by Board Member and seconded by Board Member the foregoinzn g Resolution is hereby adopted in its entirety on the following roll call vote: AYES: NOES: ABSENT: ADOPTED: IM ATTEST: Marcia McClure Torgerson, Board Secretary APPROVED AS TO FORM: Thomas R. Gibson, General Council ATASCADERO COMMUNITY REDEVELOPMENT AGENCY Tom O'Malley, Board Chairperson 10 DRAFT RESOLUTION RESOLUTION OF THE BOARD OF DIRECTORS OF THE ATASCADERO COMMUNITY REDEVELOPMENT AGENCY AUTHORIZING THE ISSUANCE AND SALE OF TAX ALLOCATION BONDS TO FINANCE REDEVELOPMENT ACTIVITIES WITHIN AND FOR THE BENEFIT OF THE AGENCY'S ATASCADERO REDEVELOPMENT PROJECT AND APPROVING RELATED DOCUMENTS AND ACTIONS WHEREAS, the Atascadero Community Redevelopment Agency (the "Agency") is a public body, corporate and politic, duly established and authorized to transact business and exercise powers under and pursuant to the provisions of the Community Redevelopment Law of the State of California, constituting Part 1 of Division 24 of the California Health and Safety Code (the "Law"), including the power to issue bonds for any of its corporate purposes; WHEREAS, a Redevelopment Plan for the Atascadero Redevelopment Project in the City of Atascadero, California (the "Redevelopment Project"), has been adopted in compliance with all requirements of the Law; WHEREAS, the Agency has determined that, due to prevailing financial market conditions, it is in the best interests of the Agency at this time to finance redevelopment activities within and for the benefit of the Redevelopment Project; WHEREAS, to provide moneys for such purpose, the Agency has determined to issue its Atascadero Community Redevelopment Agency (Atascadero Redevelopment Project), 2004 Tax Allocation Bonds, in the aggregate principal amount of not -to -exceed $14,000,000 (the "Bonds"), under the provisions of Part 1 of Division 24 of the California Health and Safety Code, commencing with section 33640 of said Code (the "Bond Law"); and WHEREAS, the Agency has duly considered such transactions and wishes at this time to authorize proceedings for the issuance and sale of the Bonds; NOW, THEREFORE BE IT RESOLVED, by the Board of Directors of the Atascadero Community Redevelopment Agency SECTION 1. Authorization. The Agency hereby authorizes the issuance of the Bonds to finance redevelopment activities within and for the benefit of the Redevelopment Project. 11 SECTION 2. Issuance of the Bonds; Approval of the Indenture. The Bonds shall be issued pursuant to the Bond Law and pursuant to an Indenture of Trust, by and between the Agency and BNY Western Trust Company, as trustee (the "Indenture"). The Agency hereby approves the Indenture in substantially the form on file with the Secretary, together with such additions thereto and changes therein as the Chairman, the Vice Chairman, the Executive Director or the Treasurer shall deem necessary, desirable or appropriate, and the execution thereof by the Chairman, the Vice Chairman, the Executive Director or the Treasurer shall be conclusive evidence of the approval of any such additions and changes. The Chairman, the Vice Chairman, the Executive Director or the Treasurer is hereby authorized and directed to execute, and the Secretary is hereby authorized and directed to attest to, the final form of the Indenture for and in the name and on behalf of the Agency. The Agency hereby authorizes the delivery and performance of the Indenture. SECTION 3. Sale of the Bonds. The Agency hereby authorizes the sale of the Bonds to the Atascadero Public Financing Authority (the "Authority") for concurrent re -sale to Piper Jaffray & Co., as underwriter (the "Underwriter"), so long as the Underwriter's discount, excluding original issue discount which does not constitute compensation to the Underwriter, does not exceed 1%. The Agency hereby approves the bond purchase agreement, by and among the Underwriter, the Agency and the Authority, in substantially the form on file with the Secretary (the "Bond Purchase Agreement"), together with such additions thereto and changes therein as the Chairman, the Vice Chairman, the Executive Director or the Treasurer shall deem necessary, desirable or appropriate, and the execution thereof by the Chairman, the Vice Chairman, the Executive Director or the Treasurer shall be conclusive evidence of the approval of any such additions and changes. In addition to the foregoing, the Agency hereby approves such changes to the Bond Purchase Agreement as the Chairman, the Vice Chairman, the Executive Director or the Treasurer shall deem necessary, desirable or appropriate to provide for the direct purchase of all or a portion of the Bonds by Fannie Mae or other institutional purchaser that is precluded by its charter or otherwise from purchasing bonds through underwriters. The Chairman, the Vice Chairman, the Executive Director or the Treasurer is hereby authorized and directed to execute the final form of the Bond Purchase Agreement for and in the name and on behalf of the Agency. SECTION 4. Official Statement. The Agency hereby approves and deems final within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934 except for permitted omissions, a preliminary form of Official Statement describing the Bonds in the form on file with the Secretary. Distribution of such preliminary Official Statement by the Underwriter to prospective purchasers of the Bonds is hereby approved. The Chairman, the Vice Chairman, the Executive Director or the Treasurer is hereby authorized to execute the final form of the Official Statement, including as it may be modified by such additions thereto and changes therein as the Chairman, the Vice Chairman, the Executive Director or the Treasurer shall deem necessary, desirable or appropriate, and the execution of the final Official Statement by the Chairman, the Vice Chairman, the Executive Director or the Treasurer shall be conclusive evidence of the approval of any such additions and changes. The Agency hereby authorizes the distribution of the final Official Statement by the Underwriter. The final Official Statement shall be executed in the name and on behalf of the Agency by the Chairman, the Vice Chairman, the Executive Director or the Treasurer. -2- 12 SECTION 5. Official Actions. The Chairman, the Vice Chairman, the Executive Director, the Treasurer and the Secretary of the Agency, and any and all other officers of the Agency, are hereby authorized and directed, for and in the name and on behalf of the Agency, to do any and all things and take any and all actions, 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 order to consummate the lawful issuance and sale of the Bonds as described herein. Whenever in. this resolution any officer of the Agency is authorized to execute or countersign any document or take any action, such execution, countersigning or action may be taken on behalf of such officer by any person designated by such officer to act on his or her behalf in the case such officer shall be absent or unavailable. SECTION 6. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption. On motion by Board Member and seconded by Board Member , the foregoing Resolution is hereby adopted in its entirety on the following roll call vote: AYES: NOES: ABSENT: ADOPTED: ATTEST: Marcia McClure Torgerson, Board Secretary APPROVED AS TO FORM: Thomas R. Gibson, General Council 13 -3- ATASCADERO COMMUNITY REDEVELOPMENT AGENCY Tom O'Malley, Board Chairperson