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OB - Item 3A - Refunding BondsROSEMEAD OVERSIGHT BOARD STAFF REPORT TO: THE HONORABLE CHAIR AND BOARD MEMBERS FROM: CAROLYN A. CHU, FINANCE DIRECTOR DATE: NOVEMBER 15, 2016 SUBJECT: SUCCESSOR AGENCY RESOLUTION# 2016 -19 SA CONFIRMING THE ISSUANCE OF 2016 TAX ALLOCATION REFUNDING BONDS AND APPROVING PRELIMINARY AND FINAL OFFICIAL STATEMENTS AND A PURCHASE CONTRACT RELATING THERETO, AND PROVIDING FOR OTHER MATTERS PROPERLY RELATING THERETO SUMMARY On July 12, 2016, the Successor Agency directed staff to move forward with refinancing the Series 2006A Bond and Series 2006B Bond and approved by the financing team. Since then, the Successor Agency (August 23), Oversight Board (August 29), and DOE (October 14) have all approved the issuance of the Refunding Bonds. As Oversight Board to the Successor Agency, staff brings this item to the Board as an informational item only. Resolution No. 2016 -19 SA, was approved by the Successor Agency on November 8, 2016, which confirmed the issuance of 2016 tax allocation refunding bonds and approved the Preliminary and Final Official Statements and the Purchase Contract related to the Bond refinancing. The next step in the process is to receive the bond rating and sell the bonds. Please find Resolution No. 2016 -19 SA attached. STAFF RECOMMENDATION There is no staff recommendation, as this is an informational item. PUBLIC NOTICE PROCESS This item has been noticed through the regular agenda notification process. Submitted by: ck'- a -ate Carolyn A. Chu Finance Director Attachments: 1. Resolution No. 2016 -19 SA ITEM NUMBER: 3A 1 RESOLUTION NO. 2016-19 SA A RESOLUTION OF THE SUCCESSOR AGENCY TO THE ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION CONFIRMING THE ISSUANCE OF 2016 TAX ALLOCATION REFUNDING BONDS AND APPROVING PRELI IINARY AND FINAL OFFICIAL STATEMENTS AND A PURCHASE CONTRACT RELATING THERETO, AND PROVIDING FOR OTHER MATTERS PROPERLY RELATING THERETO WHEREAS, the Rosemead Community Development Commission (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 "); WHEREAS, redevelopment plans for the redevelopment project area designated "Redevelopment Project Area No. P" in the City of Rosemead, California, were adopted in compliance with all requirements of the Redevelopment Law; WHEREAS, pursuant to Section 34172(a) of the California Health and Safety Code (unless otherwise noted, all Section references hereinafter being to such Code), the Former Agency has been dissolved and no longer exists as a public body, corporate and politic, and pursuant to Section 34173, the City of Rosemead has become the successor entity to the Former Agency (the "Successor Agency "); WHEREAS, prior to dissolution of the Former Agency, the Former Agency issued the following outstanding series of bonds (collectively, the "2006 Bonds ") pursuant to an Indenture, dated as of October 1, 1993, as supplemented, by and between the Former Agency and U.S. Bank National Association, as Trustee, for the purpose of financing redevelopment activities: (i) $14,005,000 initial principal amount of Rosemead Community Development Commission Redevelopment Project Area No. 1 Tax Allocation Bonds, Series 2006A, for the purpose of financing and refinancing certain redevelopment activities of the Former Agency; and (ii) $24,230,000 initial principal amount of Rosemead Community Development Commission Redevelopment Project Area No. 1 Tax Allocation Refunding Bonds, Series 2006B, for the purpose of financing and refinancing certain. redevelopment activities of the Former Agency. WHEREAS, Section 34177.5(a)(1) authorizes the Successor Agency to undertake proceedings for the refunding of outstanding bonds and other obligations of the Former Agency in order to achieve debt service savings within the parameters set forth in Section 34177.5(a)(1) (the "Savings Parameters "), and to issue bonds for such purpose 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 ") WHEREAS, the Successor Agency determined that it will achieve debt service savings on the 2006 Bonds in compliance with the Savings Parameters as evidenced by the analysis prepared by its Financial Advisor, Urban Futures, Inc., describing_ potential savings that will accrue to the Successor Agency and to applicable taxing entities as a result of the refunding of the 2006 Bonds (the "Debt Service Savings Analysis "); WHEREAS, the Successor Agency has determined that the potential debt service savings evidenced by the Debt Service Savings Analysis can be achieved by refunding the 2006 Bonds through the issuance, as authorized by Section 34177.5(f), by the Successor Agency of its "Successor Agency to the Rosemead Community Development Commission 2016 Subordinate Tax Allocation Refunding Bonds" (the "Refunding Bonds ") pursuant to the Redevelopment Law, the Refunding Law and the form of a Indenture of Trust approved by the Successor Agency pursuant to the Resolution No. 2016 -12 SA, adopted August 23, 2016, (the 'Resolution of Issuance "); WHEREAS, pursuant to Section 34179, an oversight board (the "Oversight Board") has been established for the Successor Agency and pursuant to Section 34177.5(f), the Oversight Board by Resolution No. 2016 -009 OB, adopted August 29, 2016, directed the Successor Agency to undertake such refunding proceedings and approved the issuance, sale and delivery of refunding bonds by the Successor Agency for the purpose of refunding the 2006 Bonds; WHEREAS, Resolution No. 2016 -009 OB of the Oversight Board was submitted to the California Department of Finance for its approval of such approval by the Oversight Board and the Department of Finance in a letter dated October 14, 2016, approved Resolution No. 2016 -009 OB in accordance with Section 34177.5(f); WHEREAS, the Agency has determined to sell the Refunding Bonds to Stifel, Nicolaus & Company, Incorporated (the "Underwriter ") pursuant to a Purchase Contract between the Successor Agency and the Underwriter (the "Purchase Contract"), the form of which is on file with the Secretary; WHEREAS, the Successor Agency has caused to be prepared a form of Official Statement describing the Refunding Bonds and containing material information relating to the Refunding Bonds, the preliminary form of which is on file with the Secretary; WHEREAS, the Successor Agency, with the aid of its staff, has reviewed the Purchase Contract and the Official Statement and wishes at this time to approve the foregoing as in the public interests of the Successor Agency and applicable taxing entities; NOW THEREFORE, THE CITY COUNCIL ACTING AS SUCCESSOR AGENCY HEREBY RESOLVES AS FOLLOWS: Section 1. Confirmation of Approval of Issuance of the Bonds. The Successor Agency hereby confirms its actions in the Resolution of Issuance authorizing and approving the issuance of the Refunding Bonds pursuant to the Indenture and under the Redevelopment Law and the Refunding Law. Section 2. Approval of Official Statement. The Successor Agency hereby approves the preliminary Official Statement describing the Refunding Bonds, in substantially the form on file with the Secretary. Each of the Mayor of the City of Rosemead, as Chair of the Successor Agency, the City Manager of the City of Rosemead, as the Executive Director of the Successor Agency, the Finance Director, as the chief financial officer of the Successor Agency, or the written designee of any such officer (each, an "Authorized Officer "), is hereby authorized and directed to execute and deliver the final Official Statement for and on behalf of the Successor Agency, to deliver to the Underwriter a certificate with respect to the information set forth therein and to deliver to the Underwriter a Continuing Disclosure Certificate substantially in the form appended to the final Official Statement. Distribution of the preliminary Official Statement by tho, I Tadeiwriter is hereby approved, and, prior to the distribution of the preliminary Official Statement, 6tger Authorized Officer is authorized and directed, on behalf of the Successor Agency, to deem the preliminary Official Statement "final" pursuant to Rule 15c2 -12 under the Securities Exchange Act of 1934 (the "Rule "). The executed final Official Statement, which shall include such changes and additions thereto deemed advisable by an Authorized Officer, including bond insurance and/or a reserve surety if deemed by an Authorized Officer to be appropriate for savings, and such information permitted to be excluded from the preliminary Official Statement pursuant to the Rule, is hereby approved for delivery to the purchasers of the Refunding Bonds. Section 3. Purchase Contract. The Successor Agency hereby approves the Purchase Contract prescribing the provisions for purchase and sale of the Refunding Bonds. Each Authorized Officer is hereby authorized and directed to execute and deliver, and the City Clerk, as the secretary of the Successor Agency, is hereby authorized and directed to attest to, the Purchase Contract for and in the name and on behalf of the Successor Agency, in substantially the form on file with the City Clerk, with such changes therein, deletions therefrom and additions thereto as the Authorized Officer shall approve, such approval to be conclusively evidenced by the execution and delivery of the Purchase Contract. The Successor Agency hereby authorizes the delivery and performance of the Purchase Contract. Section 4. Official Actions. All actions heretofore taken by the officers and agents of the Successor Agency with respect to the issuance of the Refunding Bonds are hereby approved, confirmed and ratified. The Authorized Officers, the City Attorney as general counsel of the Successor Agency, the Secretary 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, including but not limited to execution and delivery of any and all assignments, certificates, requisitions, including requisitions for the payment of costs of issuance of the Refunding Bonds, agreements, including an escrow agreement determined to be necessary by an Authorized Officer in order to provide for payment of the 2006 Bonds, all as determined by an Authorized Officer to be necessary and appropriate in connection with the issuance of the Refunding Bonds and in customary form, and notices, consents, and other documents, which an Authorized Officer may deem necessary or advisable, in order to consummate the sale, issuance and delivery of the Refunding Bonds to the Underwriter. Section 5. Effective Date. This Resolution shall take effect from and after the date of -approval and adoption thereof PASSED, APPROVED, AND ADOPTED this 8t' day of November, 2016. &I iOam- Sandra Armenta, Successd Agency Chair APPROVED AS TO FORM: ATTEST: Rachel Richman, ccessor Agency Counsel Marc Donohue, Successor Agency:Clzrk STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES) CITY OF ROSEMEAD ) I, Marc Donohue, Successor Agency Clerk to the Rosemead Community Development Commission of the City of Rosemead, California, do hereby certify that the foregoing Successor Agency Resolution, No. 2016 -19 SA, was duly adopted by the Board of the Successor Agency, at a regular meeting thereof held on the 8 ffi day of November, 2016, by the following vote, to wit: AYES: ALARCON, ARMENIA, CLARK, LOW, LY NOES: NONE ABSENT: NONE ABSTAIN: NONE ZA Marc Donohue, Successor Agency Clerk