CDC - Item 2B - Recommended Terms To Be Used In A Prommissory Note Payable To The City For An Advance Made By The City To RCDC On 09-28-07 And A REcommendation To Execute The Attached Prommissory NoteE M P
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ROSEMEAD COMMUNITY
DEVELOPMENT COMMISSION
STAFF REPORT
TO: HONORABLE CHAIRMAN AND COMMISSIONERS
FROM: OLIVER CHI, EXECUTIVE DIRECTOR
DATE: November 20, 2007
SUBJECT: RECOMMENDED TERMS TO BE USED IN A PROMMISSORY NOTE
PAYABLE TO THE CITY FOR AN ADVANCE MADE BY THE CITY TO
RCDC ON SEPTEMBER 28, 2007 AND A RECOMMENDATION TO
EXECUTE THE ATTACHED PROMISSORY NOTE
SUMMARY
On June 12, 2007 the Rosemead Community Development Commission ("RCDC") held
a special budget meeting. At that meeting, by a unanimous vote, the RCDC
Commissioners approved the budget which includes a transfer from the City's General
Fund to the RCDC Project Area No. 1 Capital Projects Fund of $2,497,920. A
Promissory Note ("Note") is also necessary to complete this transaction. This report is to
present to the Commission, for review, the terms to be considered for use in the
attached Note and to recommend its execution by the Commission Chairman.
STAFF RECOMMENDATION
Staff recommends that the Commission: (1) Approve the terms listed below to be used
in the attached Note made by the RCDC. (2) Direct the Commission Chairman to
execute the Note.
ANALYSIS
At the special RCDC budget meeting held on June 12, 2007, the Commission approved
the FY2007-08 budget which included a transfer from the City's General Fund of
$2,497,920. On September 28, 2007 the cash was transferred from the City's General
Fund to the RCDC Money Market Account. At the October 9, 2007 Council Meeting
City Council Members approved the terms to be used in a Note to be made by the
RCDC payable to the City. Below, for your review, are the terms that were approved by
the City Council:
1. Date: September 28, 2007
2. Principal: $2,497,920
3. Rate : 5.25% annually (LAIF equivalent)
4. Term: 20 Years
5. Payment: Annually, interest only; principal due September 28, 2027
APPROVED FOR COMMUNITY DEVELOPMENT COMMISSION AGENDA:
0
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Community Development Commission Meeting
November 20, 2007
The budget advance from the City is to pay for operating supplies, services labor and
benefits of the RCDC.
Also attached is the Promissory Note, the Repayment of Advance schedule and
Resolution No. 2007-22 authorizing the Note.
PUBLIC NOTICE PROCESS
This item has been noticed through the regular agenda notification process.
Submitted by:
Steven Brisco
Finance Director
Attachments: (1) Promissory Note (2) Repayment of Advance schedule
(3) Resolution No. 2007-22
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PROMISSORY NOTE
$2,497,920
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Date: September 28, 2007
For value received, the undersigned Rosemead Community Development Commission
(the `Borrower"), at 8838 East Valley Boulevard, Rosemead, California 91770, promises
to pay to the order of the City of Rosemead, (the "Lender"), at 8838 East Valley
Boulevard, Rosemead, California 91770, (or at such place as the Lender may designate in
writing) the sum of $2,497,920.00 with interest from September 28, 2007, on the unpaid
principal at the rate of 5.25% per annum.
The accrued interest only shall be payable in annual installments of $131,140.80
beginning on September 28, 2008, and continuing until September 28, 2027, (the "Due
Date"), at which time the remaining principal and interest shall be due in full.
THE BORROWER UNDERSTANDS THAT THE PAYMENT OF THE ABOVE
INSTALLMENT PAYMENTS MAY NOT FULLY AMORTIZE THE PRINCIPAL
BALANCE OF THE NOTE, AND THREFORE, A BALLOON PAYMENT MAY BE
DUE ON THE DUE DATE.
All payments on this Note shall be applied first in payment of accrued interest and any
remainder in payment of principal.
This Note shall be construed in accordance with the laws of the State of California.
Signed this day of at 8838 East
Valley Boulevard, Rosemead, California 91770.
Borrower:
Rosemead Community Development Commission
By:
John Tran, Chairperson
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CITY OF ROSEMEAD
Repayment of Advance
5.25%
Outstanding
Principal
Interest
Total
Principal
Payments
Payments
Payments
September 28, 2007
$ 2,497,920.00
-
$ -
$
2008
2,497,920.00
-
131,140.80
131,140.80
2009
2,497,920.00
-
131,140.80
131,140.80
2010
2,497,920.00
-
131,140.80
131,140.80
2011
2,497,920.00
-
131,140.80
131,140.80
2012
2,497,920.00
-
131,140.80
131,140.80
2013
2,497,920.00
-
131,140.80
131,140.80
2014
2,497,920.00
-
131,140.80
131,140.80
2015
2,497,920.00
-
131,140.80
131,140.80
2016
2,497,920.00
-
131,140.80
131,140.80
2017
2,497,920.00
-
131,140.80
131,140.80
2018
2,497,920.00
-
131,140.80
131,140.80
2019
2,497,920.00
-
131,140.80
131,140.80
2020
2,497,920.00
-
131,140.80
131,140.80
2021
2,497,920.00
-
131,140.80
131,140.80
2022
2,497,920.00
-
131,140.80
131,140.80
2023
2,497,920.00
-
131,140.80
131,140.80
2024
2,497,920.00
131,140.80
131,140.80
2025
2,497,920.00
131,140.80
131,140.80
2026
2,497,920.00
131,140.80
131,140.80
2027
2,497,920.00
131,140.80
2,629,060.80
Total
$ 2.497.920.00
$ 2.622.816.00
$ 5.120.736.00
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RESOLUTION NO. 2007-22
RESOLUTION OF THE ROSEMEAD COMMUNITY DEVELOPMENT
COMMISSION, CALIFORNIA AUTHORIZING THE EXECUTION OF A
PROMMISSORY NOTE IN THE AMOUNT OF $2,497,920 TO THE CITY OF
ROSEMEAD, CALIFORNIA
WHEREAS, On June 12, 2007 the Rosemead Community Development
Commission voted to approve the Fiscal 2007-08 budget, and
WHEREAS, Included in the budget is a transfer of $2,497,920.00 from the City's
General Fund to the Commission's Project Area No. 1 Capital Projects Fund, and
WHEREAS, The transfer is to be an interest bearing loan from the City secured
with a Promissory Note, and
WHEREAS, On September 28, 2007 the cash was transferred from the City's
checking account to the Commission's Money Market account.
NOW THEREFORE, BE IT RESOLVED, that the Commission does authorize
the execution of a Promissory Note dated September 28, 2007 to the City in the in the
amount of $2,497,920 at an interest rate of 5.25% per annum for a term of 20 years.
PASSED AND ADOPTED, by the Rosemead Community Development Commission,
County of Los Angeles, of the State of California on November 20, 2007.
(Chairman)
ATTEST:
(Commission Secretary)
Page 1 of 1
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Community Development Commission Meeting
November 20, 2007
The budget advance from the City is to pay for operating supplies, services labor and
benefits of the RCDC.
Also attached is the Promissory Note, the Repayment of Advance schedule and
Resolution No. 2007-22 authorizing the Note.
PUBLIC NOTICE PROCESS
This item has been noticed through the regular agenda notification process.
Attachments: (1) Promissory Note (2) Repayment of Advance schedule
(3) Resolution No. 2007-22
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