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2001-08-21 Joint CC APFA CIC MinutesMINUTES OF THE SPECIAL JOINT CITY COUNCIL, COMMUNITY IMPROVEMENT COMMISSION AND ALAMEDA PUBLIC FINANCING AUTHORITY MEETING TUESDAY - - AUGUST 21, 2001 - - 7:25 P.M. Mayor /Chair Appezzato convened the Special Joint Meeting at 7:55 p.m. Councilmember /Commissioner /Board Member Kerr led the Pledge of Allegiance. Reverend David Borglum, Home of Truth Spiritual Center, gave the Invocation. ROLL CALL - Present: Councilmembers / Commissioners / Board Members Daysog, DeWitt, Johnson, Kerr, and Mayor /Chair Appezzato - 5. Absent: None. AGENDA ITEM (CC 01- 432 /CIC 01- 23 /APFA 01 -03) Public Hearing to consider Catellus Project Demolition and Infrastructure and Redevelopment Financing Program and related Resolutions and Introduction of Ordinance. Mayor Appezzato requested City staff and consultants to provide a report on the proposed bond issues. The Finance Director stated legislation and actions, consistent with action taken by the Council on June 19, were being considered tonight; on June 19, the City Council adopted a resolution of intention to form Community Facility District No. 4, which is a financing vehicle for the Catellus project and adopted a resolution declaring intention to issue debt; the financing plan is fully supported by the Business and Waterfront Improvement Project (BWIP) tax increment and does not rely on general fund monies; the financing plan proposes to pay the general fund $3 Million, which is the outstanding BWIP project loan; the Financing Team consisted of representatives from the following departments: City Manager; Community Development; City Attorney and Finance; the Team also consisted of the following consultants: Evensen Dodge, Financial Advisors; Gardner, Underwood and Bacon, Financial Advisors; Keyser Marston and Associates, Fiscal Consultants, responsible for cash flow projections for the project; E.J. DeLaRosa and Company, Underwriters; and Quint and Thimmig, Bond Counsel. Henry Gardner, City's Financial Advisor with Gardner, Underwood and Bacon, submitted a handout of his presentation to the City Council; stated financing has been structured to have no obligation or reliance on the City or its general fund and to allow for repayment of $3 Million, which was advanced to the redevelopment agency for Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Public Financing Authority August 21, 2001 its operations; it will provide $7.2 Million for the initial phase of site demolition and backbone infrastructure for the FISC /East Housing public improvements, $1.5 Million for BWIP projects and $2.28 Million for affordable housing; the purpose of the financing is to provide funding for: the FISC /East Housing project development and the Disposition Agreement, certain public projects in the BWIP area, in accordance with redevelopment law, affordable housing projects and to repay the general fund. The main financing objectives are: 1) to provide a source of public funds which satisfies all financing purposes; 2) not to rely on the general fund; and 3) to rely solely on tax increments generated from the project area; the financing avoids impact on any outstanding commitments, including Alameda Point Master Development and BWIP obligations and City operations and maintenance; financing has been structured to provide maximum flexibility and lowest borrowing cost; financing will provide funds for the initial phase of site demolition and backbone infrastructure for the non - housing FISC /East Housing improvements in the amount of $7.2 Million; the sole source of repayment is tax increments from the BWIP project area; these are 30 -year adjustable rate bonds; $1.5 Million will finance certain projects in the BWIP area; specific projects have not been identified; projects will be identified in accordance with the Economic Development Strategic Plan and will be approved by Council when ready; $500,000 is required to go to Park Street improvements; $2.28 Million is provided for affordable housing projects in the FISC /East Housing area; 200 of the housing set aside tax increment funds will be used to fund said portion of the bonds in accordance with redevelopment law; the general fund loan repayment will be issued as a 10 -year fixed -rate taxable bond; the source of payment will be BWIP tax increments; the BWIP project area is currently paying interest -only payments; the impact on BWIP is essentially a swap; there are inherent risks with all financing and redevelopment projects; the Financing Team and the City's senior management staff worked to mitigate risks and based on conservative assumptions, judge risks to be prudent; if actual project costs for the initial phase of demolition and backbone construction exceed estimates outlined in the report, the Disposition and Development Agreement provides an arrangement for Catellus to advance funds to allow the project to proceed; e.g. the engineer's report estimates demolition costs to be $7.6 Million, and the financing only allows for $7.2 Million; if there is a construction delay and the future tax increments, on which the financing rely, do not materialize, the impact will be on the annual operations and maintenance costs currently funded by tax increments for the BWIP project area; the effect would be primarily on staffing levels for project activities; the total uses of bond proceeds is $17.5 to $18 Million: $7.2 Million for FISC /East Housing project initial site demolition and backbone Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Public Financing Authority August 21, 2001 infrastructure, $3 Million repaying the City's previously authorized loans, $1.5 Million for new projects in the BWIP area, $2.2 Million for affordable housing and $1.7 Million capitalized interest; bonds have been structured to have no payments made from tax increments during the first two years; funds are being raised internally in the bond financing to make said payments to the bond holders; two years of interest payments are represented; the debt service reserve fund is $1 Million; the bond insurance premium and credit enhancement is estimated at about $254,000; the estimated cost of issuance is $513,000; the estimated cost of issuance is the cost for the underwriter, financial advisor, bond counsel, printing cost, rating agency and other costs related to the transaction; the suggested time line for the bond issuance is approval tonight and receipt of funds on October 3, 2001. Councilmember Johnson stated the report references conveyance of the land from the Community Improvement Commission to Catellus; inquired what triggers conveyance and when it will occur. The Base Reuse and Redevelopment Manager stated one obligation, which must take place prior to conveying the land to Catellus, is the demolition of improvements at East Housing, which will be funded with bond proceeds; staff expects the first lots will be conveyed to Catellus in April, 2002. Mayor Appezzato stated the City is putting the finishing legal resolution and administrative touches on the FISC /East Housing project to be undertaken by Catellus; there has been much discussion over the last four years; the City is finally getting ready to authorize Catellus to develop 160 acres. Mayor Appezzato stated we will be considering the issuance of three separate bond issues, one by the City for its Community Facilities District No. 4, one by the Community Improvement Commission related to its Business and Waterfront Improvement Area and one by the Public Financing Authority which will be used to purchase the City and the CIC bond issues so that a single issue of bonds can be sold to the public. The bond issues are all related, in that they will finance or refinance redevelopment activity of benefit to the BWIP of the CIC, and will be repaid with BWIP tax increment revenues. We will first consider actions related to the City's bonds for its Community Facilities District No. 4. (Community Facilities District Report is attached hereto and made a part hereof by reference.) Mayor Appezzato further stated this is the time and place for the continued public hearings in this City Council's proceedings for Community Facilities District No.4. The hearings were initially Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Public Financing Authority August 21, 2001 opened at the July 17th City Council meeting and were continued to this meeting. The hearings are to inquire into the formation of the District, the levy of special taxes in the District and the need to incur bonded indebtedness in the District. Before I formally open the hearings, are there any property owners or registered voters in the District who wish to file written protests? If so, they must be filed with the City Clerk now. Paul Thimmig, Bond Counsel with Quint & Thimmig, stated there are procedural requirements which are mandated by the City's Special Tax Financing Improvement Code related to this Community Facilities District (CFD) and Government Code related to some of the bond issues; the District being discussed is the land in the FISC and East Housing area, the former Naval Station; the owner of the land is currently the CIC, which is the only entity effected by the CFD and the only entity entitled to vote or protest the vote; the only party effected is the CIC, the sole land owner within the financing district; procedural requirements are laid out in the law. Mayor Appezzato stated the continued hearings are now officially open. Does anyone wish to provide testimony on this item? There being no speakers, Mayor Appezzato closed the public portion of the hearing. CITY COUNCIL ACTION ITEMS: (01 -432A) Resolution No. 13378, "Forming the City of Alameda Community Facilities District No. 4 (Demolition and Backbone Infrastructure - Fleet Industrial Supply Center (FISC) and East Housing Sites), Authorizing the Levy of a Special Tax Within the District and Preliminarily Establishing an Appropriations Limit for the District." Adopted. Councilmember Daysog moved adoption of the Resolution. Councilmember Johnson seconded the motion, which carried by unanimous voice vote - 5. (01 -432B) Resolution No. 13379, "Determining the Necessity to Incur Bonded Indebtedness Within the City of Alameda Community Facilities District No. 4 (Demolition and Backbone Infrastructure - FISC and East Housing Sites)." Adopted. Councilmember Johnson moved adoption of the Resolution. Councilmember Kerr seconded the motion, which carried by unanimous voice vote - 5. Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Public Financing Authority August 21, 2001 (01 -432C) Resolution No. 13380, "Calling Special Election (Community Facilities District No. 4 - FISC and East Housing Sites)." Adopted. Vice Mayor Dewitt moved adoption of the Resolution. Councilmember Johnson seconded the motion, which carried by unanimous voice vote - 5. COMMUNITY IMPROVEMENT COMMISSION ACTION ITEM: Chair Appezzato stated we will now consider adoption by the CIC of a resolution authorizing the issuance of tax increment bonds by the CIC, and authorizing the CIC to vote in favor of the Community Facilities District. (01 -23A) Resolution No. 01 -98, "Authorizing the Issuance and Sale to the Alameda Public Financing Authority of Bonds Relating to the Business and Waterfront Improvement Project Area, Approving an Indenture of Trust for the Bonds, Approving Pledge Agreement and Authorizing Submission of a Ballot for the City's Community Facilities District No. 4 and Approving Other Related Documents (Including a Construction Reimbursement Agreement) and Actions (Community Facilities District No. 4 - Fleet Industrial Supply Center and East Housing Sites)." Adopted. Commissioner Johnson moved adoption of the Resolution. Commissioner Kerr seconded the motion, which carried by unanimous voice vote - 5. CITY COUNCIL ACTION ITEMS: Mayor Appezzato stated the Executive Director of the CIC has now been authorized to vote in favor of the Community Facilities District, and asked the City Clerk to open the ballot for the Community Facilities District election and announce the results of the election. The Acting City Clerk opened the ballot and announced that there were 219 votes cast in favor of the ballot measure. (Official Ballot and Canvass and Statement of Result of Election are attached hereto and made a part hereof by reference.) Mayor Appezzato stated the results of the election being unanimously in favor of the levy of the special taxes, the establishment of the appropriations limit and the incurring of bonded indebtedness for the Community Facilities District, we may Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Public Financing Authority August 21, 2001 now proceed with the final actions for the District. (01 -432D) Resolution N Election and Directing (Community Facilities Sites)." Adopted. >. 13381, "Declaring Results of Recording of Notice of Special District No. 4 - FISC and East Councilmember Kerr moved adoption of the Resolution. Special Tax Lien Housing Councilmember Daysog seconded the motion, which carried by unanimous voice vote - 5. (01 -432E) Introduction of Ordinance Levying Special Taxes Within Community Facilities District No. 4 (Demolition and Backbone Infrastructure - FISC and East Housing Sites). Introduced. Councilmember DeWitt moved introduction of the Ordinance. Councilmember Johnson seconded the motion, which carried by unanimous voice vote - 5. (01 -432F) Resolution No. 13382, "Authorizing the Issuance of Special Tax Bonds for Community Facilities District No. 4 (Demolition and Backbone Infrastructure - FISC and East Housing Sites), and Approving a Fiscal Agent Agreement and Other Related Documents (Including a Construction Reimbursement Agreement) and Actions." Adopted. Councilmember Johnson moved adoption of the Resolution. Councilmember Kerr seconded the motion, which carried by unanimous voice vote - 5. Mayor Appezzato stated we will now consider the actions necessary to approve the issuance of bonds by the Alameda Public Financing Authority. At this time I will open a public hearing by the City Council regarding the issuance of bonds by the Public Financing Authority the proceeds of which will be used to purchase the Community Facilities District bonds and the CIC bonds that have just been approved. The public hearing by the City Council on the issuance of bonds by the Public Financing Authority is now officially open. Does anyone wish to provide testimony on this item? The Acting City Clerk stated there was no one wishing to provide public testimony. (01 -432G) Resolution No. 13383, "Approving the Issuance of Bonds of Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Public Financing Authority August 21, 2001 the Community Improvement Commission of the City of Alameda and the Purchase Thereof by the Alameda Public Financing Authority and Making Findings with Respect to Bonds to be Issued by the Alameda Public Financing Authority (Community Facilities District No. 4 - FISC and East Housing Sites)." Adopted. Councilmember Daysog moved adoption of the Resolution. Vice Mayor DeWitt seconded the motion, which carried by unanimous voice vote - 5. ALAMEDA PUBLIC FINANCING AUTHORITY ITEM: Chair Appezzato stated acting as the Board of Directors of the Alameda Public Financing Authority, we will now consider the final action necessary to complete this item. (01 -03A) Resolution No. 01 -10, "Authorizing the Issuance of Revenue Bonds and the Purchase with the Proceeds of the Bonds of Special Tax Bonds of the City of Alameda and Tax Increment Bonds of the Community Improvement Commission of the City of Alameda, Approving an Indenture of Trust and Other Related Documents and Actions (Community Facilities District No. 4 - Fleet Industrial Supply Center and East Housing Sites)." [Alameda Public Financing Authority] Adopted. Board Member Johnson moved adoption of the Resolution. Board Member Kerr seconded the motion, which carried by unanimous voice vote - 5. Adjournment There being no further business, Mayor /Chair Appezzato adjourned the Special Joint Meeting at 8:21 p.m. Respectfully submitted Lara Weisiger Acting City Clerk and Acting Secretary, Community Improvement Commission and Alameda Public Financing Authority Agenda for meeting was posted in accordance with the Brown Act. Special Joint Meeting Alameda City Council, Community Improvement Commission and Alameda Public Financing Authority August 21, 2001