HomeMy WebLinkAboutItem 2f: Agreements for Issuance of 2011 Series General Obligation Bonds for Santa Anita Grade Separation Gold Line Project .
°4poRAT89 STAFF REPORT
Administrative Services Department
DATE: March 15, 2011
TO: Mayor and City Council
FROM: Donald Penman, City Manager
Hue Quach, Administrative Services Director
SUBJECT: Authorize the City Manager to execute Professional Service Agreements
with respective companies within the Financing Team for the issuance of
2011 Series General Obligation Bonds for the Santa Anita Grade
Separation Gold Line Project
Recommendation: Approve
SUMMARY
In April 2006, the voters approved a measure to authorize the sale of up to $8,000,000
in General Obligation bonds of the City to finance a grade separation for Santa Anita
Avenue at the intersection of Santa Anita Avenue and the Metropolitan Transportation
Authority Gold Line extension right -of -way. Recently, a letter of agreement was signed
between the Metro Gold Line Foothill Extension Construction Authority (Authority) and
the City of Arcadia. Under the terms of the agreement, the City is obligated to deliver
bond proceeds to the Authority thirty (30) days after it executes the Design -Build
Contract, which staff believes to be or near June 2, 2011. Staff is requesting Council's
approval to authorize the City Manager to execute professional service agreements with
respective companies that compose of the Financing Team.
DISCUSSION
At the February 15 Study Session, the City Council provided staff direction to proceed
with the course of a General Obligation bond issuance for the Santa Anita Avenue
Grade Separation. The first step towards this issuance is developing a financing team.
Staff is presenting this report to Council with the recommendation of approval to
execute professional service agreements with each respective member listed in
Attachment A for the creation of a Financing Team.
Staff and the financing team have successfully worked together in past bond issuance
and more recently on a Redevelopment Agency Bond refinancing in 2010 that allowed
the Agency to pay its housing obligation and have adequate funding available for its
priority redevelopment activities.
Their fees come from the bond issue itself as part of the cost of issuance, and are
factored into the total proceeds that the City will receive. The financing team includes
the City's financial advisors, Fieldman Rolapp and Associates, with Jim Fabian and
Darryl Street who have been before the City Council many times; Bond Counsel Kurt
Yeager of Stradling Yocca Carlson & Rauth who has represented the City and Agency
for several years and was before the Agency Board in May 2010. Best, Best & Krieger
which is acting as the City Counsel on the bond issue is also acting as the Disclosure
Counsel, which makes them responsible for the Preliminary and Final Official
Statements that discloses all important facts about the City and bond issue itself.
Additionally, though not acting as advisor to the City but providing services relating to
the bond issuance are Bank of New York Mellon and Standard and Poor's. Bank of
New York Mellon will act as the Trust Agent facilitating debt service payments and other
fiduciary duties. Standard and Poor's will act as the rating agency that expresses the
agency's opinion about the ability and willingness of the city to meet its financial
obligations. The total cost for these and other services for the bond issue is $145,000,
(including a contingency amount of $8,500) which is 1.81% of an $8 million bond issue.
FISCAL IMPACT
A projected cost totaling $145,000 is associated with the bond issuance. These fees
come from the bond issue itself as part of the cost of issuance and are factored into the
total proceeds that the City will receive.
RECOMMENDATION
That the City Council authorizes the City Manager to execute Professional Service
Agreements with each respective company listed in Attachment A to form the Financing
Team for the issuance of 2011 Series General Obligation Bonds for the Santa Anita
Grade Separation Gold Line Project
Approved �Q'�e.�•�.,s,�
Donald Penman City Manager
Attachments: A — General Obligation Bonds Financing Team
Staff Report
GO Bonds Finance Team
March 15, 2011
Page 2of2
ATTACHMENT A
City of Arcadia
General Obligation Bonds (Election of 2006)
Series 2011
Projected Cost of Issuance
Services Interested Party Payable at Closing
Bond Counsel Stradling Yocca Carlson & Rauth $ 37,500.00
Disclosure Counsel Best Best & Krieger LLP 20,000.00
Financial Advisor Field man, Rolapp & Associates 58,500.00
Rating Agency (estimate) Standard & Poor's 12,000.00
Paying Agent Bank of New York Mellon 3,500.00
Printer (estimate) TBD 5,000.00
Contingency - 8,500.00
Total Cost of Issuance $ 145,000.00