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HomeMy WebLinkAboutReso 114-21 Approving a Lease Financing and the Issuance and Sale of Lease Revenue Bonds by the Dublin Financing Authority to Finance Energy Efficiency Capital Improvements and Approving Related Documents and Official Actions Reso. No. 114-21, Item 6.1, Adopted 09/21/2021 Page 1 of 4 RESOLUTION NO. 114 - 21 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN APPROVING A LEASE FINANCING AND THE ISSUANCE AND SALE OF LEASE REVENUE BONDS BY THE DUBLIN FINANCING AUTHORITY TO FINANCE ENERGY EFFICIENCY CAPITAL IMPROVEMENTS, AND APPROVING RELATED DOCUMENTS AND OFFICIAL ACTIONS WHEREAS, the City of Dublin (the “City”) desires to acquire and install energy efficiency improvements to various City facilities (collectively, the “Project”), all which comprise capital projects of benefit to the City and its citizens; and WHEREAS, the Dublin Financing Authority (the “Authority”) was formed to, among other things, assist the City finance municipal capital improvements; and WHEREAS, in order to provide financing for a portion of the cost of the Project and incidental expenses related thereto, the City has agreed to lease certain real property, consisting of the City’s civic center complex located at 100 Civic Plaza (the “Leased Property”), to the Authority as provided in a Site Lease, as defined herein; and WHEREAS, in order to fund the Site Lease, the Authority proposes to issue and sell its Dublin Financing Authority 2021 Lease Revenue Bonds in the aggregate principal amount of not to exceed $22,000,000 (the “Bonds”) under Article 4 of Chapter 5, Division 7, Title 1 of the Government Code of the State of California, commencing with Section 6584 of said Code (the “Bond Law”); and WHEREAS, in order to secure the payments of principal of and interest on the Bonds, the Authority proposes to lease the Leased Property back to the City under a Lease Agreement (the “Lease Agreement”), under which the City is obligated to pay semiannual lease payments as rental for the Leased Property, and the Authority will assign substantially all of its rights under the Lease Agreement to U.S. Bank National Association, as trustee for the Bonds; and WHEREAS, to provide for development of the most favorable debt structure for the City and to ensure the most favorable reception in the market place for the Bonds, the City has requested the Authority to sell the Bonds through a negotiated sale pursuant to the terms of a Bond Purchase Agreement (the “Bond Purchase Agreement”) between the Authority, the City and Hilltop Securities, Inc., as underwriter (the “Underwriter”); and WHEREAS, for purposes of the sale of the Bonds, the City has caused to be prepared an Official Statement describing the Bonds, the preliminary form of which is on file with the City Clerk and the City Council, with the aid of their staff, have undertaken such review of the Official Statement as hereinafter described as is necessary to assure proper disclosure of all material facts relating to the Bonds that are within the personal knowledge of City Council members and the staff; and Reso. No. 114-21, Item 6.1, Adopted 09/21/2021 Page 2 of 4 WHEREAS, as required by Section 6586.5 of the California Government Code, the City has caused publication of a notice of a public hearing on the financing of the public capital improvements included within the Project once at least five days prior to the hearing in a newspaper of general circulation in the City; and WHEREAS, the City Council held a public hearing at which all interested persons were provided the opportunity to speak on the subject of financing such public capital improvements; and WHEREAS, in accordance with Government Code Section 5852.1, the following information has been obtained and disclosed in the staff report for the Council action set forth herein: (i) the estimated true interest cost of the Bonds, (ii) the estimated finance charge of the Bonds, (iii) the estimated proceeds of the Bonds expected to be received, net of proceeds for finance charges in (iv) above to paid from the principal amount of the Bonds, and (v) the estimated total payment amount of the Bonds; and WHEREAS, the City Council wishes at this time to approve all proceedings of the City relating to the issuance and sale of the Bonds; and WHEREAS, the first debt service payment is estimated to be made on June 30, 2022 and the City’s Adopted Budget did not include appropriations to make the payment; and WHEREAS, as presented at the July 20, 2021 City Council meeting, five Capital Improvement Projects, included funds for energy efficiency projects, including GI0221 (Resiliency and Disaster Preparedness Improvements), GI0521 (Library Tenant Improvements), GI0321 (Solar Canopies at the Wave), ST0417 (Dublin Ranch Street Light Improvements), GI0121 (Citywide Energy Improvements) which will need to be adjusted to account for the Energy Efficiency Capital Improvement Project. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Dublin as follows: Section 1. Issuance of Bonds. The City Council hereby approves the issuance of the Bonds by the Authority under the Bond Law in the maximum principal amount of not to exceed $22,000,000, for the purpose of financing the Project and incidental expenses related thereto. The City Council hereby finds that issuance of the Bonds by the Authority for the purpose of financing the Project will result in significant public benefits of the type described in Section 6586 of the California Government Code, including, but not limited to, energy cost savings, a more efficient delivery of City services to residential and commercial developments within the City and demonstrable savings in effective interest rate, bond preparation, bond underwriting and bond issuance costs. Section 2. Approval of Related Financing Agreements. The City Council hereby approves each of the following agreements required for the issuance and sale of the Bonds, in substantially the respective forms on file with the City Clerk together with any changes therein or additions thereto deemed advisable by the City Manager, Assistant City Manager, Finance Director or any of their designees (each, an “Authorized Officer”), whose execution thereof shall be conclusive evidence of the approval of any such changes or additions. Such changes or additions may include, but is not limited to, designating the City assets to be subject to the Lease Agreement or the form of the document creating the contemplated lease transaction, and providing that payment Reso. No. 114-21, Item 6.1, Adopted 09/21/2021 Page 3 of 4 of the Bonds be insured by a financial guaranty policy from a bond insurance company and/or secured by a reserve surety policy, if in the judgment of an Authorized Officer such insurance and/or reserve surety policy is in the best interest of the City. An Authorized Officer is hereby authorized and directed for and on behalf of the City to execute, and the City Clerk is hereby authorized and directed to attest, the final form of each such agreement, as follows: • Site Lease, between the City as lessor and the Authority as lessee, under which the City leases the Leased Property to the Authority in consideration of the payment of an upfront amount which will be applied by the City to finance a portion of the Project; • Lease Agreement, between the Authority as lessor and the City as lessee, under which the Authority leases the Leased Property back to the City and the City agrees to pay semiannual lease payments to provide revenues with which to pay principal of and interest on the Bonds when due; and • Continuing Disclosure Certificate, to be executed by the City, for and on behalf of itself and the Authority, for the purpose of providing annual financial information and notice of certain enumerated events to holders and beneficial owners of the Bonds. Section 3. Negotiated Sale of Bonds. The City Council hereby approves the negotiated sale of the Bonds by the Authority to the Underwriter. The Bonds shall be sold pursuant to the terms and provisions of the Bond Purchase Agreement among the Authority, the City and the Underwriter in substantially the form on file with the City Clerk together with any changes therein or additions thereto deemed advisable by an Authorized Officer. The true interest cost of the Bonds shall not exceed 3.50% and the Underwriter’s discount shall not exceed 1.00%. Section 4. Official Statement. The City Council hereby approves the preliminary Official Statement describing the Bonds in substantially the form on file with the City Clerk. An Authorized Officer is hereby authorized and directed to approve any changes in or additions to said preliminary Official Statement, and to execute an appropriate certificate stating the City’s determination that the preliminary Official Statement (together with any changes therein or additions thereto) has been deemed nearly final within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934. Distribution of the preliminary Official Statement by the Underwriter is hereby approved. An Authorized Officer is hereby authorized and directed to approve any changes in or additions to a final form of said Official Statement, and the execution thereof by an Authorized Officer shall be conclusive evidence of approval of any such changes and additions. The City Council hereby authorizes the distribution of the final Official Statement by the Underwriter. The final Official Statement shall be executed on behalf of the City by the Mayor or an Authorized Officer. Section 5. Engagement of Municipal Advisor. The firm of Fieldman, Rolapp & Associates, Inc. is hereby retained as municipal advisor to the City in connection with the issuance and sale of the Bonds by the Authority. An Authorized Officer is authorized and directed on behalf of the City to execute an agreement with said firm in a form as approved by an Authorized Officer. Section 6. Engagement of Bond and Disclosure Counsel. The firm of Jones Hall, A Professional Law Corporation, is hereby retained as bond counsel and disclosure counsel to the Reso. No. 114-21, Item 6.1, Adopted 09/21/2021 Page 4 of 4 City and the Authority in connection with the issuance and sale of the Bonds by the Authority. An Authorized Officer is authorized and directed on behalf of the City to execute an agreement with said firm in a form as approved by an Authorized Officer. Section 7. Official Actions. The Authorized Officers, the City Attorney, the City Clerk and all other officers of the City are each authorized and directed on behalf of the City to make any and all leases, assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance or termination, warrants and other documents, which they or any of them deem necessary or appropriate in order to consummate any of the transactions contemplated by the agreements and documents approved under this Resolution. An Authorized Officer may revise the identity of the Leased Property (including by adding thereto) as necessary in order to accomplish the purposes of this Resolution. Whenever in this Resolution any officer of the City 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 is absent or unavailable. Section 8. Effective Date. This Resolution shall take effect immediately upon its passage and adoption. BE IT FURTHER RESOLVED that the City Manager is hereby authorized to make adjustments to the following CIPs, to account for the changes required by the Energy Efficiency Capital Improvement Project, including GI0221 (Resiliency and Disaster Preparedness Improvements), GI0521 (Library Tenant Improvements), GI0321 (Solar Canopies at the Wave), ST0417 (Dublin Ranch Street Light Improvements), GI0121 (Citywide Energy Improvements); and BE IT FURTHER RESOLVED that the City Manager is hereby authorized to make a budget adjustment to provide appropriations for the first debt service payment anticipated to be made by June 30, 2022, in an estimated amount of $975,720, once the lease revenue bonds have been sold and the actual debt service payment has been finalized. PASSED, APPROVED, AND ADOPTED this 21st day of September 2021, by the following vote: AYES: Councilmembers Hu, Josey, Kumagai, McCorriston and Mayor Hernandez NOES: ABSENT: ABSTAIN: __________________________ Mayor ATTEST: __________________________ City Clerk