Loading...
HomeMy WebLinkAbout19. Conduct FFA meeting and adopt propsed resolution to authorize the execution of Certificates of Participation documents Page 1 of 9 Item 19. CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER MEETING DATE: JUNE 3, 2021 SUBJECT: RECESS BOARD MEETING AND RECONVENE AS THE CENTRAL CONTRA COSTA SANITARY DISTRICT FACILITIES FINANCING AUTHORITY(FFA) TO CONSIDER ADOPTING RESOLUTION NO. 2021- 03 AUTHORIZING THE EXECUTION, SALE, AND DELIVERY OF WASTEWATER REVENUE CERTIFICATES OF PARTICIPATION (COPS) IN THE MAXIMUM PRI NCI PAL AMOUNT OF $65,000,000 TO FINANCE CAPITAL IMPROVEMENT PROJECTS OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT NOTE: BOARD MEMBERS WILL NOT RECEIVE SEPARATE OR INCREASED STIPEND FOR ATTENDANCE AT THIS MEETING. SUBMITTED BY: INITIATING DEPARTMENT: KEVIN MIZUNO, FINANCE MANAGER ADMINISTRATION-FINANCE PHILIP LEIBER, DIRECTOR OF FINANCE AND ADMINISTRATION Roger S. Bailey Kenton L. Alm General Manager District Counsel ISSUE A meeting of the FFA is required to consider adoption of a resolution of the Authority to authorize the execution, delivery, and sale of wastewater revenue Certificates of Participation. BACKGROUND The FFA facilitates the proposed COPs issuance to provide funding for Central San's (the District) Fiscal Year(FY) 2020-21 and FY 2021-22 capital program. June 3, 2021 Regular Board Meeting Agenda Packet- Page 638 of 646 Page 2 of 9 The objectives and background of the proposed transaction have been outlined in position papers discussed at the District's Finance Committee meetings on April 27, 2021 and May 25, 2021 and the District's Board meetings on May 6, 2021 and June 3, 2021. To effectuate the transaction, adoption of a resolution by the FFA is necessary. This resolution is attached to this Position Paper and addresses the following: • The Board of Directors hereby authorizes the sale of COPs through a public offering undertaken via competitive sale; provided: • The maximum issuance amount of the COPs does not exceed $65 million • The maximum true interest cost does not exceed 2.00%. (The anticipated true interest cost as of May 27 is expected to be less than 1.001%; however some room for interest rate fluctuations between now and the bond pricing during mid-June is provided for). • Approval of necessary financing related documents including: • Installment Sale Agreement between the District and the FFA, under which the FFAagrees to provide funds to finance the project in consideration of semiannual payments to be made from amounts pledged thereto, which consists of the net revenues of the wastewater system and the ad valorem property tax revenues received by the District; • Indenture among the District, the FFA and the Trustee, whereby the Trustee agrees to execute and deliver the COPs and to apply the proceeds thereof to accomplish the purposes of the financing. • Authorization for the President, Executive Director, Treasurer, Secretary, and all other officers of the Board of Directors and the authority to execute necessary documents related to the financing. ALTERNATIVES/CONSIDERATIONS I n order for the COPs financing to proceed, adoption of an issuance resolution is required by the FFA. The issuance resolution is attached to this position paper, after the agenda and minutes of the prior FFA meeting. FINANCIAL IMPACTS The FFA will receive from the District the full amount necessary on an annual basis to cover the scheduled debt service on the COPs. This annual debt service will pay investors principal and interest on the scheduled due dates through the scheduled final maturity date in FY 2028-29. At the expected issuance amount, the COPs are planned to generate net proceeds of approximately$58 million, exclusive of issuance costs ($221,750) and the underwriter discount ($517,700), to reimburse and fund portions of the District's FY 2020-21 and FY 2021-22 capital expenditure program. Debt service on the COPs, including principal and interest payments, is expected to be approximately $60.1 million, subject to actual interest costs to be set upon pricing of the bonds in mid-June. Debt service will be recovered from FY 2021-22 through FY 2028-29, with annual debt service declining over that period. The financial impact to the District is described in the position paper to District's Board also dated June 3, 2021. COMMITTEE RECOMMENDATION Not applicable. June 3, 2021 Regular Board Meeting Agenda Packet- Page 639 of 646 Page 3 of 9 RECOMMENDED BOARD ACTION Staff recommends the FFA Board: 1. Approve the minutes of the May 6, 2021 FFA meeting, and 2. Adopt the proposed resolution. Strategic Plan re-In GOAL THREE: Fiscal Responsibility Strategy 1—Maintain financial stability and sustainability, Strategy 2—Ensure integrity and transparency in financial management ATTACHMENTS: 1. F FA Agenda for J une 3, 2021 2. Draft Minutes of 05-06-2021 FFA Meeting 3. Proposed Resolution June 3, 2021 Regular Board Meeting Agenda Packet- Page 640 of 646 Page 4 of 9 Attachment 1 CENTRAL CONTRA COSTA SANITARY DISTRICT FACILITIES FINANCING AUTHORITY JUNE 3, 2021 MEETING AGENDA 1. CALL MEETING TO ORDER 2. ROLL CALL 3. PUBLIC COMMENTS 4. APPROVAL OF MINUTES a. Approve Minutes of May 6, 2021 meeting STAFF RECOMMENDATION (Motion Required): Approve the minutes. 5. FFA BUSINESS RELATED MATTER a. Consider adopting Resolution No. 2021-03 to authorize the execution, sale, and delivery of wastewater revenue Certificates of Participation (COPs) in the maximum principal amount of $65,000,000 to finance capital improvement projects of the Central Contra Costa Sanitary District STAFF RECOMMENDATION (Motion Required): Adopt Resolution No. 2021-03 as proposed. 6. OTHER BUSINESS RELATING TO MATTERS ABOVE 7. ADJOURNMENT a. Adjourn meeting of the Authority and reconvene as the Board of Directors of the Central Contra Costa Sanitary District. June 3, 2021 Regular Board Meeting Agenda Packet- Page 641 of 646 Page 5 of 9 DRAFT Attachment 2 MINUTES OF THE MEETING OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT FACILITIES FINANCING AUTHORITY HELD ON MAY 6, 2021 NOTICE In accordance with the Governor's Executive Order N-29-20, which suspended certain requirements of the Brown Act due to the ongoing COVID-19 pandemic, all Board Members participated in this meeting via teleconference. Members of the public were provided options to participate in the meeting as provided on the agenda. 1. CALL TO ORDER At 3:30 p.m., President Pilecki adjourned the Central San Board meeting and convened a meeting of the Central Contra Costa Sanitary District Facilities Financing Authority (the "Authority'). 2. ROLL CALL Chair Pilecki requested that Katie Young, Secretary of the Authority, call roll. PRESENT: Members: Hockett, Lauritzen, McGill, Williams, Pilecki ABSENT: Members: None In compliance with Assembly Bill 23, it was noted that Board Members will not be receiving a separate or increased stipend for this meeting. 3. PUBLIC COMMENTS No comments. 4. APPROVAL OF MINUTES a. Approve Minutes of January 21 , 2021 meeting. AUTHORITY ACTION: It was moved by Member McGill and seconded by Member Lauritzen to approve the Authority minutes of the January 21, 2021 meeting. Motion passed by unanimous roll call vote of the Authority Members. 5. FFA BUSINESS RELATED MATTER a. Consider adopting Resolution No. 2021-02 to continue the Authority and rescind Resolution No. 2021-01 AUTHORITY ACTION: It was moved by Member McGill and seconded by Member Hockett to adopt Resolution No. 2021-02 to continue the Facilities Financing Authority and rescind Resolution No. 2021-01. Motion passed by unanimous roll call vote of the Authority Members. June 3, 2021 Regular Board Meeting Agenda Packet- Page 642 of 646 Page 6 of 9 CENTRAL CONTRA COSTA SANITARY DISTRICT FACILITIES FINANCING AUTHORITY Minutes of May 6, 2021 Board Meeting 6. OTHER BUSINESS RELATING TO MATTERS ABOVE None. 7. ADJOURNMENT There being no further business to come before the Authority, Chair Pilecki adjourned the annual meeting of the Authority at 3:33 p.m. after which the meeting of the Central San District Board of Directors reconvened. Katie Young Secretary of the Authority 2 June 3, 2021 Regular Board Meeting Agenda Packet- Page 643 of 646 Page 7 of 9 Attachment 3 RESOLUTION NO. 2021-03 RESOLUTION OF THE BOARD OF DIRECTORS OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT FACILITIES FINANCING AUTHORITY AUTHORIZING THE EXECUTION, DELIVERY AND SALE OF WASTEWATER REVENUE CERTIFICATES OF PARTICIPATION IN THE MAXIMUM PRINCIPAL AMOUNT OF $65,000,000 TO FINANCE CAPITAL IMPROVEMENT PROJECTS OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT, AND APPROVING RELATED DOCUMENTS AND ACTIONS WHEREAS, the Central Contra Costa Sanitary District (the "District") owns and operates facilities and property for the collection,treatment, disposal and reuse of wastewater within the service area of the District (the "Wastewater System"), and in order to provide funds to finance improvements to the Wastewater System, the District and the Central Contra Costa Sanitary District Facilities Financing Authority (the "Authority"), desire to cause the execution and delivery of Certificates of Participation (the "Certificates"); and WHEREAS, the Certificates will be executed and delivered by U.S. Bank National Association, as trustee (the "Trustee") pursuant to an Indenture of Trust (the "Indenture"), among the District, the Authority and the Trustee, and will evidence direct, undivided fractional interests in installment payments to be made by the District to the Authority, pursuant to an Installment Sale Agreement (the "Installment Sale Agreement"), between the District and the Authority; and WHEREAS, the information required to be obtained and disclosed by the Board of Directors with respect to the Certificates pursuant to Government Code Section 5852.1 is set forth in the staff report accompanying this Resolution; and WHEREAS, the Board of Directors wishes to authorize the execution, delivery and sale of the Certificates, the form of the Indenture, the form of the Installment Sale Agreement, and related matters. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Central Contra Costa Sanitary District Facilities Financing Authority as follows: Section 1. Approval of Financing Plan and Related Documents. The Board of Directors hereby approves the execution, delivery and sale of the Certificates for the purpose of providing funds for capital improvement projects of the District, as specified in the Installment Sale Agreement(the "Project"). To that end, the Board of Directors hereby approves each of the following financing documents in substantially the respective forms on file with the Secretary, together with any changes therein or additions thereto approved by the President, Executive Director or Treasurer(each, an "Authorized Officer"), provided that the execution thereof by an Authorized Officer shall be conclusive evidence of such approval: • Installment Sale Agreement between the District and the Authority, under which the Authority agrees to provide funds to finance the Project in consideration of semiannual payments to be made from amounts pledged thereto, which consists of the net revenues of the Wastewater June 3, 2021 Regular Board Meeting Agenda Packet- Page 644 of 646 Page 8 of 9 Resolution No. 2021-03 Page 2 of 3 System and the ad valorem property tax revenues received by the District. • Indenture among the District, the Authority and the Trustee, whereby the Trustee agrees to execute and deliver the Certificates and to apply the proceeds thereof to accomplish the purposes of the financing. Each Authorized Officer is hereby authorized and directed for and in the name and on behalf of the Authority to execute the final form of each of the foregoing documents, and the Secretary is hereby authorized and directed to attest to the final form of each of the foregoing documents. The schedule of semiannual payments attached to the Installment Sale Agreement, as executed and delivered, shall correspond to the payments of principal and interest represented by the Certificates, to be determined upon the sale thereof as set forth in Section 2. Section 2. Competitive Sale of Certificates. The Board of Directors hereby authorizes the sale of the Certificates through a public offering undertaken via competitive sale; provided, that the maximum principal amount of the Certificates shall not exceed $65,000,000 and the true interest cost of the Certificates shall not exceed 2.00%. The Certificates shall be offered and sold pursuant to and in accordance with the notice of sale on file with the Secretary, together with any changes therein or additions thereto deemed advisable by the District's municipal advisor and approved by the District's bond counsel and by an Authorized Officer. The Board of Directors hereby delegates to each of the Authorized Officers the authority to accept an offer from the winning bidder to purchase the Certificates from the District. Section 3. Official Actions. The President, the Executive Director, the Treasurer, the Secretary and all other officers of the Board of Directors and the Authority are each authorized and directed in the name and on behalf of the Authority to make any and all assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and other documents, which they or any of them might deem necessary or appropriate in order to consummate the execution, delivery and sale of the Certificates and any of the other transactions contemplated by the agreements and documents approved pursuant to this Resolution. Whenever in this Resolution any officer of the Authority is authorized 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 5. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption. * * * * * * * * * * * * -2- June 3, 2021 Regular Board Meeting Agenda Packet- Page 645 of 646 Page 9 of 9 Resolution No. 2021-03 Page 3 of 3 PASSED AND ADOPTED this 311 day of June, 2021, by the following vote: AYES: NOES: ABSENT: President of the Board of Directors of the Central Contra Costa Sanitary District Facilities Financing Authority, County of Contra Costa, State of California COUNTERSIGNED: Secretary of the Central Contra Costa Sanitary District Facilities Financing Authority, County of Contra Costa, State of California Approved as to Form: Jones Hall, A Professional Law Corporation Special Counsel to the District -3- June 3, 2021 Regular Board Meeting Agenda Packet- Page 646 of 646