HomeMy WebLinkAbout2024-001 - Resolution - (S.A.) RESOLUTION NO. SA 2024-001
A RESOLUTION OF THE SUCCESSOR AGENCY TO THE
RANCHO CUCAMONGA REDEVELOPMENT AGENCY
APPROVING THE ISSUANCE OF REFUNDING BONDS IN
ORDER TO REFUND CERTAIN OF ITS OUTSTANDING BONDS,
APPROVING THE EXECUTION AND DELIVERY OF A SEVENTH
SUPPLEMENTAL INDENTURE RELATING THERETO,
REQUESTING OVERSIGHT BOARD APPROVAL OF THE
ISSUANCE OF THE REFUNDING BONDS, REQUESTING
CERTAIN DETERMINATIONS BY THE OVERSIGHT BOARD,
AND PROVIDING FOR OTHER MATTERS PROPERLY
RELATING THERETO
WHEREAS, the Rancho Cucamonga Redevelopment Agency (the "Former
Agency") was 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 Health and
Safety Code of the State (the "Redevelopment Law"); and
WHEREAS, a plan for the redevelopment project known and designated as the
"Rancho Project Area Rancho Cucamonga Redevelopment Agency Plan" (the "Redevelopment
Plan")for that certain project area described in the Redevelopment Plan (the "Project Area")was
adopted and approved by Resolution No. RA 81-14 on December 23, 1981, as amended pursuant
to Ordinance No. 316A on August 13, 1987, Ordinance No. 537 on November 16, 1994,
Ordinance No. 657 on June 20, 2001, and Ordinance No. 674 on January 16, 2002, and all
requirements of law for and precedent to the adoption and approval of the Redevelopment Plan
have been duly complied with; and
WHEREAS, to finance and refinance redevelopment activities through the
issuance of bonds the Former Agency and subsequently the Successor Agency entered into a
Trust Indenture, dated as of March 1,1990, between the Former Agency and Computershare
Trust Company, N.A. (the"Trustee"), as successor to Bank of America National Trust and Savings
Association, as trustee (the "Indenture"), as amended and supplemented by that First
Supplemental Indenture, dated as of February 1, 1994, between the former Agency and Trustee,
as successor to Bank of America National Trust and Savings Association, as trustee (the "First
Supplemental Indenture"), a Second Supplemental Indenture between the Former Agency and
Trustee, as successor to U.S. Bank Trust National Association, as trustee (the "Second
Supplement'), dated as of August 1, 1999, the Third Supplemental Indenture between the Former
Agency and Trustee, as successor to Wells Fargo Bank National Association, as trustee (the
"Third Supplement'), dated as of August 1, 2001, the Fourth Supplemental Indenture between
the Former Agency and Trustee, as successor to Wells Fargo Bank National Association, as
trustee (the "Fourth Supplement'), dated as of March 1, 2004 for the purpose of financing and
refinancing redevelopment activities with respect to the Redevelopment Project, the Fifth
Supplemental Indenture between the Successor Agency and the Trustee, as successor to Wells
Fargo Bank, N.A. as trustee (the "Fifth Supplement'), dated July 1, 2014, and a Sixth
Supplemental Indenture between the Successor Agency and the Trustee, as successor to Wells
Fargo Bank N.A., as trustee (the"Sixth Supplement")dated October 1, 2016 (collectively with the
Indenture, First Supplement, Second Supplement, Third Supplement, Fourth Supplement, Fifth
.Supplement, the "Original Indenture"); and
Resolution No. SA 2024-001 — Page 1 of 9
WHEREAS, by implementation of California Assembly Bill X1 26, which amended
provisions of the California Redevelopment Law, (found at Health and Safety Code Section
33000, et.seq.) and the California Supreme Court's decision in California Redevelopment
Association v. Matosantos, the Former Agency was dissolved on February 1, 2012 in accordance
with California Assembly Bill X1 26 approved by the Governor of the State of California on June
28, 2011 ("AB 26"), and on February 1, 2012, the Successor Agency, in accordance with and
pursuant to AB 26, assumed the duties and obligations set forth in AB 26 for the Former Agency,
including, without limitation, the obligations of the Former Agency under the Indenture, the First
Supplement, the Second Supplement, the Third Supplement and the Fourth Supplement and
related documents to which the Former Agency was a party; and
WHEREAS, Section 34177.5(a)(1)of the Dissolution Act authorizes the Successor
Agency to undertake proceedings for the refunding of outstanding bonds and other obligations of
the Former Agency„subject to the conditions precedent contained in said Section 34177.5; and
WHEREAS, Section 34177.5 authorizes the Successor Agency to issue refunding
bonds pursuant to Article 11 (commencing with Section 53580) of Chapter 3 of Part 1 of Division
2 of Title 5 of the Government Code (the "Refunding Law") for the purpose of achieving debt
service savings within the parameters set forth in Section 34177.5(a)(1) (the "Savings
Parameters"); and
WHEREAS, the Successor Agency issued its $174,050,000 Successor Agency to
the Rancho Cucamonga Redevelopment Agency Rancho Redevelopment Project Area Tax
Allocation Refunding Bonds, Series 2014 (the "Prior Bonds") for the purpose of refinancing the
certain outstanding, bonds of the Former Agency pursuant to the Indenture and the Fifth
Supplement; and
WHEREAS, to determine compliance with the Savings Parameters for purposes
of the issuance by the Successor Agency to the Rancho Cucamonga Redevelopment Agency
Rancho Redevelopment Project Area Tax Allocation Refunding Bonds, Series 2025 (the
"Refunding Bonds"), the Successor Agency has caused its municipal advisor, Fieldman, Rolapp
& Associates, Inc. (the "Municipal Advisor"), to prepare an analysis of the potential savings that
will accrue to the Successor Agency and to applicable taxing entities as a result of the use of the
proceeds of the Refunding Bonds to repay all or a portion of the Prior Bonds and, thereby, to
refund all or a portion of the Prior Bonds (the "Debt Service Savings Analysis"); and
WHEREAS, Section 5852.1 of the Government Code of the State of California
("Section 5852.1") provides that the Successor Agency obtain from an underwriter, financial
advisor or private lender and disclose, in a meeting open to the public, prior to authorization of
the issuance of the-Refunding Bonds, good faith estimates of: (a) the true interest cost of the
Refunding Bonds, (b) the finance charge of the Refunding Bonds, meaning the sum of all fees
and charges paid to third parties, (c) the amount of proceeds of the Refunding Bonds received
less the finance charge described above and any reserves or capitalized interest paid or funded
with proceeds of the Bonds and (d) the sum total of all debt service payments on the Refunding
Bonds calculated to the final maturity of the Refunding Bonds plus the fees and charges paid to
third parties not paid with the proceeds of the Refunding Bonds; and
WHEREAS, in accordance with Section 5852.1, the Successor Agency has
obtained such good faith estimates from the Municipal Advisor and such estimates are disclosed
in Exhibit A attached hereto; and
Resolution No. SA 2024-001 — Page 2 of 9
WHEREAS, in order to refund the Prior Bonds, the Successor Agency wishes at
this time to approve the issuance of the Refunding Bonds pursuant to the Original Indenture and
to approve the form of and authorize the execution and delivery of the Seventh Supplemental
Indenture, expected to be dated as of the first day of the month such bonds are issued, by and
between the Successor Agency and Computershare Trust Company, N.A., as trustee, providing
for the issuance of the Refunding Bonds (the "Seventh Supplemental Indenture") and the
Irrevocable Refunding Instructions (the "Irrevocable Refunding Instructions"); and
WHEREAS, in order to provide for the authentication and delivery of the Refunding
Bonds, to establish and declare the terms and conditions upon which the Refunding Bonds are to
be issued and secured and to secure the payment of the principal thereof and interest and
redemption premium (if any) thereon, the Successor Agency and the Trustee have duly
authorized the execution and delivery of this Seventh Supplemental Indenture; and
WHEREAS, pursuant to Section 34179, an oversight board(the"Oversight Board")
has been established for the Successor Agency; and
WHEREAS, the Successor Agency requests that the Oversight Board approve the
issuance of the Refunding Bonds pursuant to this Resolution, the Original Indenture and the
Seventh Supplemental Indenture; and
WHEREAS, the Successor Agency further requests that the Oversight Board
make certain determinations described below on which the Successor Agency will rely in
undertaking the refunding proceedings and the issuance of the Refunding Bonds; and
WHEREAS, the Successor Agency has determined to sell the Refunding Bonds
on a negotiated basis to Stifel, Nicolaus & Company, Incorporated (the "Underwriter"); and
WHEREAS, following approval by the Oversight Board of the issuance of the
Refunding Bonds by the Successor Agency and upon submission of the Oversight Board
Resolution to the California Department of Finance for its approval of the issuance of the
Refunding Bonds, the Successor Agency will, with the assistance of its Disclosure Counsel and
the Municipal Advisor, cause to be prepared a form of Official Statement describing the Refunding
Bonds and containing material information relating to the Successor Agency and the Refunding
Bonds, the preliminary form of which will be submitted to the Successor Agency for approval for
distribution by the Underwriter to persons and institutions interested in purchasing the Refunding
Bonds.
NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the
City Council of the City of Rancho Cucamonga, acting in its capacity as the legislative body of the
Successor Agency to the Rancho Cucamonga Redevelopment Agency, as follows:
Section 1. Determination of Savings. The Successor Agency has
determined that there are significant potential savings available to the Successor Agency and to
applicable taxing entities in compliance with the Savings Parameters by the issuance by the
Successor Agency of the Refunding Bonds to provide funds to refund and defease all or a portion
of the outstanding Prior Bonds, all as evidenced by the Debt Service Savings Analysis on file with
the of the Successor Agency, which Debt Service Savings Analysis is hereby approved.
Section 2. Approval of Issuance of the Bonds. The Successor Agency
hereby authorizes and approves the issuance of the Refunding Bonds under Health and Safety
Resolution No. SA 2024-001 — Page 3 of 9
i
Code Section 34177.5, the Refunding Law, the Original Indenture and the Seventh Supplemental
Indenture in the aggregate principal amount of not to exceed $96,000,000, provided that the
Refunding Bonds are in compliance with the Savings Parameters at the time of sale and delivery.
Section 3. Approval of Seventh Supplemental Indenture. The Successor
Agency hereby approves the Seventh Supplemental Indenture prescribing the terms and
provisions of the Refunding Bonds and the application of the proceeds of the Refunding Bonds.
Each of the Mayor, as the Chair and presiding officer of the Successor Agency, or the City
Manager of the City of Rancho Cucamonga, as the chief administrative officer of the Successor
Agency (each, an "Authorized Officer"), is hereby authorized and directed to execute and deliver,
and the Secretary of the Successor Agency, is hereby authorized and directed to attest to, the
Seventh Supplemental Indenture for and in the name and on behalf of the Successor Agency, in
substantially the form on file with the Secretary of the Successor Agency, with such changes
therein, deletions therefrom and additions thereto as the Authorized Officer executing the same
shall approve, such,approval to be conclusively evidenced by the execution and delivery of the
Seventh Supplemerital Indenture. The Successor Agency hereby authorizes the delivery and
performance of the Seventh Supplemental Indenture.
Section 4. Approval of Irrevocable Refunding Instructions. The form of the
Irrevocable Refunding Instructions on file with the Secretary is hereby approved and the
Authorized Officers are, each acting alone hereby authorized and directed, for and in the name
and on behalf of the Successor Agency, to execute and deliver the Irrevocable Refunding
Instructions. The Successor Agency hereby authorizes the delivery and performance of its
obligations under the Irrevocable Refunding Instructions by the Authorized Officers.
Section 5. Oversight Board Approval of the Issuance of the Bonds. The
Successor Agency hereby requests the Oversight Board as authorized by Section 34177.5(f) and
Section 34180 to approve the issuance of the Refunding Bonds pursuant to Section 34177.5(a)(1)
and this Resolution and the Seventh Supplemental Indenture.
Section 6. Determinations by the Oversight Board. The Successor Agency
requests that the Oversight Board make the following determinations upon which the Successor
Agency will rely in undertaking the refunding proceedings and the issuance of the Refunding
Bonds:
(a) The Successor Agency is authorized, as provided in Section 34177.5(f), to
recover its costs related to the issuance of the Refunding Bonds from the proceeds of the
Refunding Bonds, including the cost of reimbursing the City for administrative staff time
spent with respect to the authorization, issuance, sale and delivery of the Refunding
Bonds;
(b) The application of proceeds of the Refunding Bonds by the Successor
Agency to the refunding and defeasance of all or a portion of the Prior Bonds, as well as
the payment,by the Successor Agency of costs of issuance of the Refunding Bonds, as
provided in Section 34177.5(a), shall be implemented by the Successor Agency promptly
upon sale and delivery of the Refunding Bonds notwithstanding Section 34177.3 or any
provision of law to the contrary without the approval of the Oversight Board, the California
Department of Finance,the San Bernardino County Auditor-Controller or any other person
or entity other than the Successor Agency;
Resolution No. SA 2024-001 — Page 4 of 9
(c) The Successor Agency shall be entitled to receive its full Administrative
Cost Allowance under Section 34181(a)(3) without any deductions with respect to
continuing costs related to the Refunding Bonds, such as trustee's fees, auditing and fiscal
consultant fees and continuing disclosure and rating agency costs (collectively,
"Continuing Costs of Issuance"), and such Continuing Costs of Issuance shall be payable
from property tax revenues pursuant to Section 34183. In addition and as provided by
Section 34177.5(f), if the Successor Agency is unable to complete the issuance of the
Refunding Bonds for any reason, the Successor Agency shall, nevertheless, be entitled
to recover its costs incurred with respect to the refunding proceedings from such property
tax revenues pursuant to Section 34183 without reduction in its Administrative Cost
Allowance.
Section 7. Filing of Debt Service Savings Analysis and Resolution. The
Secretary of the Successor Agency is hereby authorized and directed to file the Debt Service
Savings Analysis, together with a certified copy of this Resolution, with the Oversight Board, and,
as provided in Section 341800) with the San Bernardino County Administrative Officer, the San
Bernardino County Auditor-Controller and the California Department of Finance.
Section 8. Sale of Refunding Bonds. The Successor Agency hereby
approves the sale of the Refunding Bonds by the Successor Agency to the Underwriter pursuant
to the terms of a bond purchase agreement (the "Purchase Contract")to be entered into with the
Underwriter. Following approval by the Oversight Board of the issuance of the Refunding Bonds
by the Successor Agency and upon submission of the Oversight Board Resolution to the
California Department of Finance, the Successor Agency will, with the assistance of Best Best &
Krieger LLP, its Bond Counsel, and the Municipal Advisor, work with the Underwriter to prepare
a form of the Purchase Contract, the preliminary form of which will be submitted to the Successor
Agency for approval. The Underwriter's discount (not including issue discount) may not exceed
0.75% of the principal amount of the Refunding Bonds.
Section 9. Issuance of Refunding Bonds in Whole or in Part. It is the intent
of the Successor Agency to sell and deliver the Refunding Bonds in whole, provided that there is
compliance with the Savings Parameters. However, the Successor Agency will initially authorize
the sale and delivery of the Refunding Bonds in whole or, if such Savings Parameters cannot be
met with respect to the whole, then in part; provided that the Refunding Bonds so sold and
delivered in part are in compliance with the Savings Parameters. The sale and delivery of the
Refunding Bonds in part will in each instance provide sufficient funds only for the refunding of that
portion of the Refunding Bonds that meet the Savings Parameters. In the event the Refunding
Bonds are initially sold in part, the Successor Agency intends to sell and deliver additional parts
of the Refunding Bonds pursuant to an additional supplement to the Indenture without the prior
approval of the Oversight Board provided that in each such instance the Refunding Bonds so sold
and delivered in part are in compliance with the Savings Parameters.
Section 10. Municipal Bond Insurance and Surety Bonds. The Authorized
Officers, each acting alone, are hereby authorized and directed to take all actions necessary to
obtain a municipal bond insurance policy for the Refunding Bonds and reserve account surety
bonds for the Refunding Bonds from a municipal bond insurance company if it is determined,
upon consultation with the Municipal Advisor to the Successor Agency and the Underwriter, that
such municipal bond insurance policy and/or surety bonds will reduce the true interest cost or
increase cash flow savings with respect to the Refunding Bonds.
Resolution No. SA 2024-001 — Page 5 of 9
i
Section 11. Approval of Official Statement. Following approval by the
Oversight Board of the issuance of the Refunding Bonds by the Successor Agency and upon
submission of the Oversight Board Resolution to the California Department of Finance for its
approval of the issuance of the Refunding Bonds and the Successor Agency will, with the
assistance of their Disclosure Counsel and the Municipal Advisor, cause to be prepared a form of
Official Statement describing the Refunding Bonds and containing material information relating to
the Successor Agency and the Refunding Bonds, the preliminary form of which will be submitted
to the Successor Agency for approval for distribution by the underwriter of the Refunding Bonds
to persons and institutions interested in purchasing the Refunding Bonds.
Section 12. Official Actions. The Authorized Officers and any and all other
officers of the Successor Agency are hereby authorized and directed, for and in the name and on
behalf of the Successor Agency, to do any and all things and take any and all actions, which they,
or any of them, may deem necessary or advisable in obtaining the requested approvals by the
Oversight Board and the California Department of Finance and in the issuance, sale and delivery
of the Refunding Bonds. Whenever in this Resolution any officer of the Successor Agency is
directed 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 13. Effective Date. This Resolution shall take effect immediately upon
its adoption.
r
Resolution No. SA 2024-001 — Page 6 of 9
PASSED, APPROVED, and ADOPTED this 2"d day of October, 2024.
L. Dennis Mi hael, Pres' ent
ATTEST:
r
J nice C. Reynolds, Secreta'
STATE OF CALIFORNIA )
COUNTY OF SAN BERNARDINO ) ss
CITY OF RANCHO CUCAMONGA )
I,Janice C. Reynolds, Secretary of the Successor Agency to the Rancho Cucamonga
Redevelopment Agency, do hereby certify that the foregoing Resolution was duly passed,
approved, and adopted by the Successor Agency of the City of Rancho Cucamonga
Redevelopment Agency, at a Regular Meeting of said Successor Agency held on the 2"d day
of October, 2024.
AYES: Hutchison, Kennedy, Michael, Scott, Stickler
NOES: None
N\V N,.••
ABSENT: None
.'U'RP O�.O,9
k4'�
ABSTAINED: None '20
NOV 30 °:Z=
�O•, �-
1977 :.G;
Executed this 31 day of October, 2024, at Rancho Cucamonga, California. �'.y�....
/"Ii�i�FORt����
The foregoing his rument is a correct copy
of:the original on file-in this office.
ATTEST- Orip6ec 3 , 20 ?�
JANICE C. REYNOLDS
Secret y. an Ito Cu"Cam nga, Callo I nice C. Reynolds, Secretary
; Y:— - — -
Resolution No. SA 2024-001 — Page 7 of 9
EXHIBIT A
GOOD FAITH ESTIMATES
The good faith estimates set forth herein are provided with respect to the
Refunding Bonds in accordance with California Government Code Section 5852.1. Such good
faith estimates have been provided to the Successor Agency by the Municipal Advisor in
consultation with the Underwriter.
Principal Amount. The Municipal Advisor has informed the Successor Agency that,
based on the financing plan and current market conditions, it's good faith estimate of the
aggregate principal amount of the Refunding Bonds to be sold is $90,705,000 (the "Estimated
Principal Amount"), which excludes approximately $8,724,300 of net premium estimated to be
generated based on current market conditions. Net premium is generated when, on a net
aggregate basis for a single issuance of bonds, the price paid for such bonds is higher than the
face value of the bonds.
True Interest Cost of the Refunding Bonds. The Municipal Advisor has informed
the Successor Agency that, assuming that the Estimated Principal Amount of the Refunding
Bonds is sold, and based on market interest rates prevailing at the time of preparation of such
estimate, its good faith estimate of the true interest cost of the Refunding Bonds, which means
the rate necessary to discount the amounts payable on the respective principal and interest
payment dates to the purchase price received for the Refunding Bonds, is 2.70%.
Finance Charge of the Refunding Bonds. The Municipal Advisor has informed the
Successor Agency that, assuming that the Estimated Principal Amount of the Refunding Bonds
is sold, and based on market interest rates prevailing at the time of preparation of such estimate,
its good faith estimate of the finance charge for the Refunding Bonds, which means the sum of
all fees and charges paid to third parties (or costs associated with the Refunding Bonds), is
$1,163,203.
Amount of Proceeds to be Received. The Municipal Advisor has informed the
Successor Agency that, assuming that the Estimated Principal Amount of the Refunding Bonds
is sold, and based on market interest rates prevailing at the time of preparation of such estimate,
its good faith estimate of the amount of proceeds expected to be received by the Successor
Agency, on behalf of the City, for the sale of the Refunding Bonds, less the finance charge of the
Refunding Bonds, as estimated above, and any reserves or capitalized interest paid or funded
with proceeds of the Refunding Bonds, is $98,266,097.
Total Payment Amount. The Municipal Advisor has informed the Successor
Agency that, assuming that the Estimated Principal Amount of the Refunding Bonds is sold, and
based on market interest rates prevailing at the time of preparation of such estimate, its good faith
estimate of the total payment amount, which means the sum total of all payments the Successor
Agency will make to pay debt service on the Refunding Bonds, plus the finance charge for the
Refunding Bonds, as described above, not paid with the proceeds of the Refunding Bonds,
calculated to the final maturity of the Refunding Bonds, is $110,185,913 (excluding any offsets
from reserves or capitalized interest).
Resolution No. SA 2024-001 — Page 8 of 9
The foregoing estimates constitute good faith estimates only. The actual principal
amount of the Refunding Bonds issued and sold,the true interest cost thereof, the finance charges
thereof, the amount of proceeds received therefrom and total payment amount with respect
thereto may differ from such good faith estimates due to (a) the actual date of the sale of the
Refunding Bonds being different than the date assumed for purposes of such estimates, (b) the
actual principal amount of Refunding Bonds sold being different from the Estimated Principal
Amount, (c)the actual amortization of the Refunding Bonds being different than the amortization
assumed for purposes of such estimates, (d) the actual market interest rates at the time of sale
of the Refunding Bonds being different than those estimated for purposes of such estimates, (e)
other market conditions,or(f)alterations in the financing plan or finance charges,or a combination
of such factors. The actual date of sale of the Refunding Bonds and the actual principal amount
of Refunding Bonds sold will be determined by the Successor Agency, on behalf of the City, based
on the timing of the need for proceeds of the Refunding Bonds and other factors. The actual
interest rates borne by the Refunding Bonds will depend on market interest rates at the time of
sale thereof. The actual amortization of the Refunding Bonds will also depend, in part, on market
interest rates at the time of sale thereof. Market interest rates are affected by economic and other
factors beyond the control of the Successor Agency.
Resolution No. SA 2024-001 — Page 9 of 9