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Home My WebLink About2006-02-08 e-packet AGENDA ;REDEVELOPMENT AGENCY CITY OF SOUTH SAN FRANCISCO REGULAR MEETING MUNICIP AL SERVICE BUILDING COMMUNITY ROOM WEDNESDAY, FEBRUARY 8, 2006 7:00 P.M. PEOPLE OF SOUTH SAN FRANCISCO You are invited to offer your suggestions. In order that you may know our method of conducting Agency business, we proceed as follows: The regular meetings of the Redevelopment Agency are held on the second and fourth Wednesday of each month at 7:00 p.m. in the Municipal Services Building, Community Room, 33 Arroyo Drive, South San Francisco, California. Public Comment: For those wishing to address the Board on any Agenda or non-Agendized item, please complete a Speaker Card located at the entrance to the Community Room and submit it to the Clerk. Please be sure to indicate the Agenda Item # you wish to address or the topic of your public comment. California law prevents Redevelopment Agency from taking action on any item not on the Agenda (except in emergency circumstances). Your question or problem may be referred to staff for investigation and/or action where appropriate or the matter may be placed on a future Agenda for more comprehensive action or a report. When your name is called, please come to the podium, state your name and address for the Minutes. COMMENTS ARE LIMITED TO THREE (3) MINUTES PER SPEAKER. Thank you for your cooperation. The Clerk will read successively the items of business appearing on the Agenda. As she completes reading an item, it will be ready for Board action. JOSEPH A. FERNEKES Chair RICHARD A. GARBARINO, SR. Vice Chair MARK N. ADDIEGO Boardmember PEDRO GONZALEZ Boardmember KARYL MATSUMOTO Boardmember RICHARD BATTAGLIA Investment Officer SYLVIA M. PAYNE Clerk BARRY M. NAGEL Executive Director STEVEN T. MATT AS Counsel PLEASE SILENCE CELL PHONES AND PAGERS HEARING ASSISTANCE EQUIPMENT IS A V AILABLE FOR USE BY THE HEARING-IMPAIRED AT REDEVELOPMENT AGENCY MEETINGS CALL TO ORDER ROLL CALL AGENDA REVIEW PUBLIC COMMENTS CONSENT CALENDAR 1. Motion to approve the minutes of January 25,2006 2. Motion to confirm expense claims of February 8, 2006 ADMINISTRATIVE BUSINESS 3. Resolution selecting Citigroup as underwriter for Redevelopment Agency bond sale ADJOURNMENT REGULAR REDEVELOPMENT AGENCY MEETING AGENDA FEBRUARY 8, 2006 PAGE 2 :-)~t\ ~N ~ f!; ~ .0 ;>-0 ~ p () ..... _ c -::'1J;n-'()l\.~'l': ~ AGENDA REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, California 94083 Meeting to be held at: MUNICIPAL SERVICES BUILDING 33 ARROYO DRIVE FEBRUARY 8, 2006 7:00 P.M. ADDENDUM Item Number :Lis added to the Redevelopment Agency meeting agenda as follows: 4. Resolution authorizing execution of agreement with CST Environmental Inc. for lead and asbestos abatement at 380 Alta Vista Drive in the amount of$42,475.90 ~'t\l sM S (0 n >< - ~ ~ to) 0 C4l1FO'P-~\.~ Redevelopment Agency Staff Report RDA AGENDA ITEM #3 DATE: February 8, 2006 TO: Redevelopment Agency Board FROM: Jim Steele, Financial Officer SUBJECT: RESOLUTION AUTHORIZING THE SELECTION OF CITIGROUP TO PERFORM UNDERWRITING SERVICES FOR THE SALE OF AGENCY BONDS RECOMMENDATION: It is recommended that the Redevelopment Agency Board approve the attached resolution authorizing staff to select Citigroup to serve as underwriter in the upcoming Redevelopment Agency bond sale. Approval of Citigroup as underwriter will not obligate the Agency Board to sell bonds. Rather, an underwriter is needed now to assist the Agency with credit rating agency presentations. Staff will bring back the legal documents for the bond sale at an upcoming meeting. BACKGROUND/DISCUSSION: In November 2005, the Agency's independent financial advisors, Public Financial Management, Inc. (PFM), assisted the Agency in issuing a Request for Qualifications (RFQ) for firms to serve as underwriter of the Agency's 2006 Tax Allocation Bonds.. An underwriter is a banking firm that specializes in public finance, and which assists the Agency by structuring the bond package, marketing the bonds, and then purchasing the bonds from the Agency for resale to investors. Interested parties were asked to describe their recent experience in selling Redevelopment bonds in California, provide a strategy for approaching ratings agencies, offer an analysis of their recommended bond structure, and propose a fee for services. Five firms responded to the RFQ, and four, Banc of America Securities, Piper Jaffray, Citigroup, and Stone & Youngberg, were considered qualified. One firm was not considered a qualified candidate, given an inadequate amount of analysis it provided for its recommended bond transaction strategy, as well as its limited sales network and narrow experience with Redevelopment bonds. The four qualified firms were invited to make a presentation to further discuss their qualifications. Members of the interviewing team included two staff from PFM, as well as City staff members, including Finance Director Jim Steele, Accountant Charly Yang, and Financial Analyst Colleen Tribby. The interviewing team unanimously selected Citigroup because of its detailed analysis of the transaction, its insightful observations of structuring alternatives, its prior experience in marketing RDA bonds, its competitive price and the strength of its rating agency strategy. In addition, Citigroup has a very broad banking team that will provide expert services in a number of areas, and will be able to provide more than Staff Report To: Redevelopment Agency Board Re: Resolution Authorizing the Selection of Citigroup to Perform Underwriting Services for the Sale of Agency Bonds Date: February 8, 2006 Page: 2 of 3 adequate backup to each other. Finally, one key member of the Citigroup team is a former rating analyst with Moody's Rating Services, and would be uniquely able to address some of the credit weaknesses of the Agency. Those weaknesses include a disproportionate concentration of assessed value ascribed to a few property owners, the dominance of one industry (biotech), and the relatively large number of assessed value appeals that Genentech has been filing over the years. Purchasers of bonds and rating agencies like to see a larger diversity of property ownership to assure a secure revenue stream in the event of a downtUrn in one industry. Nevertheless, Citigroup is confident that a strong rating agency presentation can be made, and that the Agency should be able to acquire an investment grade rating in the high BBB category, or even in the low A category. References were checked on Citigroup's other recent RDA transactions, and all references were strong. They included the Redevelopment Agencies of the Cities of San Jose and Fremont, the Redevelopment Agency of the County of Riverside, and the Bay Area Rapid Transit District (BART), which used Citigroup to market bonds recently. Discussions about Citigroup's service and quality of work were also followed up with an independent city financial advisor not on this engagement, and with the City's bond counsel, Jones Hall. Citigroup's proposed fees were very competitive. Of the four qualified firms, only one firm, Piper Jaffray, proposed lower fees. (Because underwriting services are a professional service, the lowest proposal does not have to be accepted, as price is only one factor in the selection criteria, similar to engineering and design services, and legal services). The fee proposals are below, and are based on an assumed $61 million bond sale. The fees are structured as a percentage ofthe bond sale, plus expenses, so if a smaller bond sale is approved, the underwriter's compensation will decrease. Total Underwriter Compensation, Assuming a $61 million issuance: Stone and Youngberg $ Banc of America Securities $ Citigroup $ Piper Jaffray $ 372,330 305,650 257,658 207,800 Staff believed that while the lowest proposer, Piper Jaffray was qualified, its recent Redevelopment work had focused on smaller agencies and smaller Redevelopment bond sales. In addition, Piper does not have as deep of a sales and marketing network that Citigroup does have, which should result in lower interest rates when the bonds are actually sold. Citigroup has 1,629 sales and trading professionals in California, vs. 230 for Piper. Citigroup has a reputation (verified through reference calls) of aggressively pricing their clients' bonds. Staff Report To: Redevelopment Agency Board Re: Resolution Authorizing the Selection of Citigroup to Perform Underwriting Services for the Sale of Agency Bonds Date: February 8, 2006 Page: 3 of 3 Staff believes it is in this area, in aggressively marketing, that the real savings for the Agency will be realized. It would take only an average interest rate savings on the bonds of .00075% from what the next lowest proposer, Piper Jaffray could secure in the marketplace to offset the higher initial fees paid to Citigroup. For example, if the average interest rates on the bonds sold under Citigroup were 3.9925%, and they were 4.000% under Piper, then the initial fees would be made up for. Staff believes this is a reasonable assumption to make in selecting Citigroup. The bond sale is not being approved tonight, only the selection of an underwriter. Furthermore, approval of Citigroup as underwriter tonight will not obligate the Agency Board to sell bonds. Staff will bring back the legal documents for the bond sale at an upcoming meeting. Those bond documents will include the formal contract between the Agency and Citigroup. Finally, as is typical for underwriting services, compensation to Citigroup is dependent on the sale of bonds.. Ifno bond sale occurs, no compensation to Citigroup will be owed. FISCAL IMPACT: Underwriters are paid out of bond proceeds, and those costs have been factored into the projections previously given to Council. Based on a potential bond sale of $61 million, the underwriter ~ill be paid $257,658, including expenses. Payment of the bond underwriter is contingent on the successful sale of Agency bonds. CONCLUSION: Given the quality of Citigroup's proposal, the strength and depth of their team assigned to South San Francisco, their credit strategy, and the strength of their references, staff recommends that Citigroup be selected to provide underwriting services. Prepared by: ~_ Ji Steele Financial Officer Approved by Attachments: Resolution Citigroup Proposal Pages JS/BN:ed RESOLUTION NO. RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO APPROVING OF THE SELECTION OF CITIGROUP TO SERVE AS UNDERWRITER OF THE 2006 TAX ALLOCATION BONDS WHEREAS, the Agency Board held a study session on potential RDA funding needs on August 17,2005, and in a joint session wi the City Council on November 16, 2005 the Agency Board gave conceptual approval for a list of capital projects and directed staff to proceed with an RDA Bond sale; and WHEREAS, the Agency considers the selection of its bond underwriter to be an important endeavor, as it will have significant impact on (1) the structure of the Agency's bond financing, (2) the Agency's success at achieving a favorable bond rating, and (3) the overall cost-efficiency ofthe Agency's bond sale; and WHEREAS, the Agency and its financial advisor conducted an extensive selection process which included interviewing top qualifying underwriting firms, and evaluating these for the most appropriate qualifications, experience, and fee proposals; and WHEREAS, City staff and the Agency's financial advisor agreed that Citigroup was the most qualified underwriter for the 2006 Tax Allocation Bond Sale, based on the firm's written proposal and its presentation; and WHEREAS, approval of Citigroup as underwriter will not commit the Agency to selling bonds, as staff will bring back the legal documents for the bond sale at an upcoming meeting; and WHEREAS, those bond documents will include the formal contract between the Agency and Citigroup, known as the bond purchase agreement; and WHEREAS, Citigroup will be compensated only through the bond proceeds of a successful bond sale. NOW, THEREFORE, BE IT RESOLVED by the Redevelopment Agency of the City of South San Francisco that the Redevelopment Agency Board hereby approves of the selection of Citigroup as the underwriter of its 2006 Tax Allocation Bonds. * * * * * * I hereby certify that the foregoing Resolution was regularly introduced and adopted by the Redevelopment Agency of the City of South San Francisco at a regular meeting held on the _ day of , 2006 by the following vote: AYES: NOES: ABSTAIN: ABSENT: ATTEST: City Clerk ~ cltlgroUpJ corporate and investment banking REDEVELOPME;NT AGENCY OF THE CITY OF SOUTH SAN F'RANCISCO QUALIFICATIONS TO PROVIDE BOND UNDERWRITING SERVICES 2006 TAX ALLOCATION BONDS December 5, 2,005 CITIGROUP GLOBAL MARKETS INC ONE SANSOME STREET, CITIGROUP CENTER, SUITE 2800, SAN FRANcIsco CA 94104 FAX: (415) 951-1748 .... cltlgroUpJ corporate and investment banking December 05, 2005 Mr. Jim Steele Finance Director City of South San Francisco 400 Grand Avenue South San Francisco, CA 94080 Dear Mr. Steele: On behalf of Citigroup Global Markets Inc., we thank you for giving us the opportunity to respond to your request for a statement of qualifications to provide bond underwriter services for the Redevelopment Agency of the City of South San Francisco's 2006 Tax Allocation Bond Program. We look forward to the opportunity work with the Agency and we believe that our qualifications present a compelling case that Citigroup should be selected to serve as the Agency's underwriter. We would also like to highlight the following for the Agency: ../ Undisputed Leadership in Municipal Bond Underwriting both Nationally and in California - In eight of the past nine years, Citigroup has ranked as the number one municipal bond underwriter in the nation according to industry rankings compiled by Thomson Financial. Over the past six years, Citigroup has also senior managed more California bonds than any other firm. Citigroup' s consistent results demonstrate our unwavering commitment to public finance and the high quality of service that we provide to our California clients. ./ Citigroup is a Leading Underwriter of Tax Allocation Bond Financings - Citigroup is a leading underwriter of tax allocation bond financings both nationallv and in California for 2005 year to date, having underwritten over $400 million of negotiated tax allocation bonds since the beginning of this year. Since January 2002, Citigroup has underwritten 50 tax allocation financings nationally totaling approximately $1.4 billion in par amount, including 42 transactions in California totaling approximately $1.2 billion in par amount. Citigroup's presence in this sector has been fueled by a strong commitment of resources and expertise. Equally important, Citigroup has consistently provided our clients with the lowest interest rates in the market. v" Creative and Committed Bankers with Expertise in California Tax Allocation Bond Finance The Citigroup financing team provides the Agency with bankers who have a number of years of experience working with redevelopment agencies throughout California. In addition to the coverage and expertise provided by Alex Burnett, who will serve as project manager for this transaction and Michael Gomez our regional banker for the San Francisco Bay Area, our development and redevelopment finance specialists, Nikolai Sklaroff and Carmen Vargas, have worked together since 1997 to deliver true value-added service to our clients by crafting creative financing solutions and delivering customized products such as letters of credit, bridge loans and other financial products. v" Unsurpassed Distribution Capabilities - Citigroup's extensive local and national distribution capabilities ensure that the Agency's bond issue will receive the widest distribution and the most competitive pricing possible. Our retail distribution system is impressive, consisting of over 11,715 financial consultants in 516 offices nationwide. In California, Citigroup has 1,610 financial consultants in 59 offices (branded "Smith Barney") located throughout the State with 350 Financial Consultants in the Bay Area alone, including the cities and counties of San Francisco, Alameda, San Mateo, Santa Clara and San Jose. These consultants manage over 870,000 retail accounts for California residents with assets totaling over $169 billion. Additionally, we have two Citibank branches in the City if South San Francisco with Citigroup Investment Services representatives. CITIGROUPGLOBALMARKETSINC. ONE SANSOME STREET, CITIGROUP CENTER, SUITE 2800, SANFRANClSCO CA 94104 FAX: (415) 951-1748 Mr. Jim Steele City of South San Francisco December 05, 2005 Page 2 ../ Capital Commitment - Citigroup clearly has sufficient capital to underwrite the Agency's transactions. Citigroup is the largest fmancial services comoanv in the world, with over 3,200 offices in 100 different countries. Given our current excess net capital of approximately $2.6 billion as of September 30, 2005, Citigroup has the ability to solely underwrite any sized transaction the Agency may issue. This huge capital base is readily available to the Agency to stabilize prices and underwrite any unsold bonds during the course of the pricing stage of the fmancing. We are excited about an opportunity to work for the City and its Financial Advisor, Public Financial Management. We hope you will find that Citigroup is uniquely qualified to provide the highest level of underwriting services. We appreciate your consideration and look forward to the possibility of working with the Redevelopment Agency of the City of South San Francisco. Our proposal is valid for 90 days. If you have any questions, please do not hesitate to contact us at the numbers listed below. Sincerely, Alex Burnett Managing Director (415) 951-1742 alex. [email protected] Nikolai Sklaroff Director (415) 951-1710 nikolai. i [email protected] Michael Gomez Director (415) 951-1615 michael. t. [email protected] cc : Sarah Hollenbeck, Public Financial Management Inc. CmGROUP GLOBAL MARKETS INc. ONE SANSOMESTREEf, CmGROUP CENTER, SUIfE2800, SAN FRANCISCO CA 94104 FAX: (415) 951-1748 REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO QUALIFICATIONS TO PROVIDE UNDERWRITING SERVICES Submitted by CITIGROUP GLOBAL MARKETS INC. December 05, 2005 TABLE OF CONTENTS Pae:es B. Firm and Individual Qualifications....................................................................................l C. Underwriter's Counsel...... ...... ...... ..... .................. ... ......... ....... ........ ...... ... ..... .................10 D. Fees.......................................................................................................................... .10 APPENDIX A: Citigroup's Taxable Municipal Financing Experience APPENDIX B: Citigroup's Redevelopment Financing Experience APPENDIX C: Financing Team Resumes APPENDIX D: Numerical Analysis APPENDIX E: Information on Project Areas APPENDIX F: Pending Litigation ...... cltlgroUpJ corporate and investment banking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 1 I - Fm.J"1 AND JNDI"IDU.\L QUALlFIC\ TIONS - i B.1. Provide a brief description of your firm and its capabilities. In particular, please describe your firm's experience with marketing tax allocation bonds and taxable municipal bonds in California. Also discuss your firm's municipal sales and distribution capabilities, including the number of offices and registered representatives in the nation, the West Coast, and California. Citigroup is the largest financial services firm in the world with operations in more than 100 countries, over 280,000 employees, $1.3 trillion in assets and a book value in excess of $97 billion. The firm's major businesses include investment banking, securities brokerage, asset management, traditional commercial banking, consumer fmance, credit cards, and life insurance. Citigroup Global Markets, Inc., the legal entity which conducts the firm's investment banking activities, is the largest investment bank in the United States. ClTIGROUP'S MUNICIPAL SECURITIES DIVISION Citigroup's Municipal Securities Division within Citigroup Global Markets Inc., includes the Public Finance Department and the Municipal Syndicate, Sales and Trading Department. This Division, with 370 professionals, represents one of the largest commitments to municipal finance of any firm on Wall Street. Moreover, we are a major public finance force in virtually every regional market and have one of the largest networks of regional public finance offices of any securities firm. This organizational structure allows Citigroup to combine resources from the regions, which have extensive knowledge of local financing issues, with industry specialists from New York, the firm's corporate headquarters. Public finance has long been one of the core businesses of Citigroup. While we are one of the leading firms serving large institutional investors, we place equal emphasis on individual investors. Our retail clients hold a large portion of their assets in municipal bonds, and municipal bonds are often the first product our brokers use when prospecting for clients. As a result, our commitment to public finance is central to our overall business strategy. Commitment to California. In addition to being one of the top underwriters of municipal bonds in the nation, Citigroup is the number one ranked firm in California, senior managing $8.7 billion in 2005 YTD. Citigroup commitment to California include public fmance offices in San Francisco with seven account officers and five support staff; Los Angeles with 12 account officers and six support staff and Sacramento with one account officer. We have California-based bankers focused on City fmancings and a full-service California-based underwriting, sales and trading desk located in Los Angeles. Corporate and 1m estment Banking II\l d Inrumc, EqUltlt." .md IlI\t:slrncnt Banl,lll~ S&P RatIng AA- !\1oody"s Ratmg Aal [- - - - - - - - - - -- - - - - - - - - - TAX AI:'LO(:~ TION-Bo~,iD-FINANCINGS- - - -- -- --- -- I - - -- - -- --- - -~--- -- ---- - ---- - --_____ __ __ _____ __ __~__ - ____ .________ - - ___I In addition to being the number #1 firm in the industry, Citigroup is a leading underwriter of tax allocation bond financings both nationally and in California for 2005 year- to-date, having underwritten over $409 million of negotiated tax allocation bonds in California and gaining a 14% market share. Since January 2002, Citigroup has underwritten 50 tax allocation financings nationally totaling approximately $1.4 billion in par amount, including 42 transactions in California totaling approximately $1.2 billion in par amount. The following is a select list of our engagements for tax allocation bonds, including our recent experience underwriting and marketing taxable tax allocation bonds. National Municipal Bond Underwriter Rankings Negotiated Tax Allocation Bond Issues 2005 YTD ($ millions and market share) Citigroup $409 Stone & Youngberg ,', $348 RBC Capital Markets $254 J P Morgan Securities Inc $232 Kinsell Newcomb & De Dios Inc J Source: Thomson Financial ...... cltlgroUpJ corporate ilnd investment banking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 2 ~ ~ _ _ _ ~ _ _ _ RECENT REDEVE~,,-OPME",,'f T ~X ALLOC~.~!ON JJ~~_ E~p~RIENC~ ~~ _ ____ ____ __ _ __I > San Jose Redevelopment Agency. Citigroup and the San Jose Redevelopment Agency worked on a unique and creative fmancing leveraging Housing Set Aside Revenues and utilizing new CDLAC allocation proceeds to issue $10,445,000 of Tax-Exempt Refunding Tax Allocation Bonds, $119,275,000 of Taxable Refunding Tax Allocation Bonds and $33,075,000 of Tax-Exempt Variable Rate Tax Allocation Bonds in June 2005. This complex fmancing, which resulted in a major restructuring of the Agency's Housing Set-Aside debt, was recently named "Far West Deal of the Year" by The Bond Buyer. (Senior Manager) > County of Riverside Redevelopment Agency. Citigroup most recently acted as senior manager on $144,075,000 of new money Non-Housing Tax Allocation Bonds for the Agency. The transaction closed this week. Citigroup also acted as senior manager on $102,785,000 of new money Non Housing Tax Allocation Bonds and $75,225,000 new money Tax Allocation Housing Bonds, which had a $37,000,000 Taxable piece. The fmancing priced in December 2004 (Senior Manager). Additionally, we worked with the Agency on an $18,245,000 Tax Allocation Housing Refunding Bonds Transaction, which priced the first week of Apri12005 (Sole Manager). > Palm Desert Redevelopment Agency. Citigroup is a member of the Agency's underwriting pool. Citigroup also acted as sole manager on $24,945,000 of Tax Allocation Revenue Refunding Bonds for the Agency's Redevelopment Project Area No.1, As Amended. The transaction generated net present values savings of approximately $800,000 or 3.59%. (Sole Manager). > City of Oceanside. Citigroup has served and continues to serve as the City's underwriter for various financings - 13 to date with one in process. Recent transactions include a Senior Lien Tax Allocation bond issue done in September 2004 and June 2003 and a Subordinate Lien Tax Allocation transaction completed in February 2002 for the City's Community Development Commission (Sole Manager). > Community Redevelopment Agency of the City of Santa Ana. Citigroup acted as lead manager on approximately $57,085,000 of Tax Allocation Bonds for the City's South Main Street Redevelopment Project Area. (Sole Manager). Taxable Bond Experience In recent years, Citigroup Global Markets Inc. has solidified its position as the leading underwriter of taxable municipal debt. In every year since 2001, we bave been among the top senior managers of national taxable debt. Since January 2002, Citigroup has underwritten 160 taxable financings nationally totaling approximately $17 billion in par amount, including 33 transactions in California totaling approximately $2.7 billion in par amount. In 2005 year to date, Citigroup has remained the number one senior manager of taxable transactions in California, having brought to market 7 taxable municipal transactions with an aggregate par amount of over $1.0 billion. National Municipal Bond Underwriter Rankings Negotiated Taxable issues 2005 YTD ($ millions and market share) Citigroup $4,541 UBS Financial SeNces Inc Lehman Brothers RBC Capital Markets Merrill Lynch & Co Source: Thomson Financial ~ ~ ~__ _____~~__~ =~_ __ -SALES AND M~,"-~~ETING CAPA!l.!~!IES --- ~___~_~~~-=-.J Citigroup is strong in all bond distribution channels: retail, middle market, and institutional. Moreover, we are the only major Wall Street firm that maintains a full-service municipal sales, trading, and underwriting commitment desk in California, with five traders/underwriters and 16 municipal bond salespeople based in Los Angeles and dedicated specifically to the California market. These complementary distribution networks enable us to take advantage of "pockets of demand" from all types of investors and sell securities at the lowest possible interest rates. .... cltlgroUpJ corporate and investment banking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 3 Our marketing capabilities are summarized below: ~h < ~V~~^~ V ~ ~ _~ ~^^ ^~ ~,,< =~ ~ ~~n ~. ~ ~ ~~ "~~_ ~~N~ _~.~ JlflNhET "STlTl 7 {() \AL Jlf/J)/)LE MANKET HIGH M:. T II ON Tll/NETAIL SU,ME \'7 NATIONAL 11 OFFICES 11 UNDERWRlTERS 20 SALES SPECIALISTS 300 ACCOUNTS 55 OFFICES 111 SALES SPECIALISTS 9,500 INTERMEDIATE ACCOUNTS CALIFORNIA LA BASED SALES, TRADING & UNDERWRlTING DESK 5 TRADERS/UNDERWRITERS 3 SALES SPECIALISTS 35 ACCOUNTS 9 OFFICES 11 SALES SPECIALISTS 1,200 INTERMEDIATE ACCOUNTS 513 OFFlCES 11,842 FINANCIAL CONSULTANTS, 5.8 MILLION RETAIL ACCOUNTS $941.3 BILLION TOTAL ASSETS $96.7 BILLION MUNI BOND ASSETS 59 OFFICES 1,610 FINANCIAL CONSULTANTS 871,702 RETAIL ACCOUNTS $169.7 BILLION TOTAL ASSETS $17.9 BILLION MUNI BOND ASSETS Institutional Distribution Capabilities-Our position as the leading municipal bond underwriter stems in part from our strong relationships with institutional investors. Our relationships with institutional investors make a significant difference, both in terms of trust and the ultimate acceptance of a bond issue by the institution and in the provision of timely feedback. Such feedback helps us: 1) ascertain the volume of institutional demand for the bonds at a given level and 2) tailor an issue to meet the needs of specific institutional purchasers. Unsurpassed Institutional Capabilities- Citigroup was ranked number one in municipal institutional bond trading and marketing in Institutional Investor magazine's November 2004 issues and in the past issues in November 2001, 2000 and 1999. Citigroup was also ranked number one in municipal bonds, global investment- grade debt, high yield debt, asset-backed securities, and global bonds in the April 2001 issue of Investment Dealers' Digest. Our position as the leading municipal bond underwriter stems, in part, from our strong relationships with institutional investors 2004 Municipal Trading Firm Ranltings Institutional Investor ftlagazine Rank 1 2 3 4 5 Firm Citigroup Global Markets Inc. Bear, Steams & Co. Merrill Lynch Lehman Brothers UBS Regional Institutional Coverage-Citigroup augments its New York institutional sales efforts with 11 regional municipal trading offices to maximize institutional placement options for its clients. Unlike most firms, Citigroup establishes its institutional sales offices where these key institutional buyers are located. Dallas, Los Angeles, Chicago, and Seattle are examples of Citigroup institutional sales offices covering "local accounts" that manage California municipal trades. Coveral!e of Middle-Market Institutions-Citigroup also maintains a formal, managed, nationwide distribution system geared to small and medium-sized institutional investors. Our middle-market program includes specialists in 98 locations nationwide who focus exclusively on these smaller institutional investors, as well as approximately 125 fixed-income-oriented retail Financial Consultants who cover middle-market institutions along with their retail accounts. Investment banking firms without retail distribution systems are not in a position to effectively access middle-market institutions, since they lack the network of offices that foster local relationships and allow for daily contact with investors. This sector is less yield sensitive than larger institutions and therefore is a key investor sector. Retail Distribution Capabilities-Retail investors own more than 35% of all tax-exempt bonds. Retail investors are an important distribution outlet because these investors are the least yield sensitive buyers. A strong book of retail orders helps diminish the bargaining power institutional investors may otherwise hold. The following information demonstrates our unparalleled capabilities in this area. ...... cltlgroUpJ corporate and investment banking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 4 California Retail Sales Force-Citigroup maintains a significant retail presence in California with 1,610 financial consultants based in 59 Smith Barney offices throughout the State. Our California Consultants manage over 870,000 retail accounts for California residents which contain over $169 billion of assets. Our bankers work closely with our California retail fmance offices to ensure that our California brokers understand our clients' programs and fmancing goals. Due to the high state income tax in California, the ability to maximize penetration of the in-state retail market is crucial to achieving the lowest possible interest rates for the Agency. Bakersfield Berkeley Beverly Hills Bro. Carlsb.d Centul)' City QaremJnt Eureka Folsom Fresno Glendale Irvine Laguna Hills Laguna Niguel !.alolia Long Beach Long Beach Marina Los Angeles Library Tower Los Angeles Citigroup Center Manhattan Beach Marin County Menlo Park Menlo Park Modesto Montccito NeVlport Beach Ornnge PahnDesert Palo Alto 29 Pasadena 42 Pasadena 78 Pleasanton 18 32 22 22 7 16 29 31 48 9 27 39 20 14 37 63 21 22 35 25 23 5 '52 25 23 41 Diego Diego -S,sn Fr.l.ncisco S'~ Frnncisco SanJose San Mateo Santa 'Barbara Santa darn Santa Cruz, Santa Rosa \, Scotts Valley' Sherman Oaks \, Torrance Venturn VlSslia WaInut Creek Westlake Vlllage Westwood Pla2a Whittier Woodland Hills \, \ \, 17 31 27 12 16 8 32 28 12 35 48 87 47 33 17 29 19 10 28 5 35 21 17 7 39 17 28 9 41 1,610 59 National Retail Sales Force-Citigroup has a national distribution network that allows us to focus on retail investor demand for tax-exempt bonds across the country. With over 11,842 fmancial consultants in 513 offices nationwide we service more than 5.8 million retail accounts collectively representing over $96.7 billion of direct holdings of tax-exempt bonds. In addition, Citigroup's total secondary market daily trading volume for municipals is approximately $300 million, of which approximately $200 million is accounted for by retail trades. High-Net-Worth Program- One aspect of our retail sales operation that sets Citigroup apart from its competitors is our Fixed-Income High-Net-Worth program, which is the largest on Wall Street. This program accesses over 32,900 separate high-net-worth portfolios with assets totaling over $77.5 billion, the vast majority of which are invested in municipal bonds. The cornerstone of the program is a team of 21 municipal portfolio specialists that includes high-net-worth representatives located on our regional desks across the country. B.2. In tabular form, provide a list of all taxable municipal financings on which the firm has served as senior or co-manager since January 2002, specifically identifying staffmembers involved. Please refer to Appendix A for a list of all taxable municipal financings senior-managed or co-managed by Citigroup. As shown, Citigroup has underwritten more than $43 billion of taxable municipal financings since January 2002. "rotal~:s Number of''Om B.3. In tabular form, provide a list of all redevelopment financings on which the firm has served as senior or co- manager since January 2002, specifically identifying staffmembers involved. Please refer to Appendix B for a list of all redevelopment fmancings senior-managed or co-managed by Citigroup. As shown, Citigroup has underwritten more than $2.4 billion of redevelopment financings since January 2002. B.4. Please identify the individual who would serve as project manager and day-to-day contact for the Agency's engagement, as well as each individual in your firm who would be assigned to provide services to the Agency. Describe the role and responsibility of each member of your team with respect to this engagement. Discuss the project manager's relevant experience and specific qualifications to serve the Agency on this transaction. Provide a brief resume for each individual who would be assigned to this transaction, emphasizing recent relevant experience with tax allocationfinancings. Citigroup has assembled a team of experienced bankers whose combined product, regional and industry expertise we believe cannot be matched. Alex Burnett, a Managing Director based in San Francisco will serve a project manager and day-to-day contact for the Agency's engagement. Mr. Burnett joined Citigroup as a Managing Director in 2005, having spent his previous 15 years as a fmancial advisor. In that capacity, Mr. Burnett worked on fmancings for cities, counties, utilities and transportation agencies throughout the Bay Area and California. This work included significant general municipal as well as tax allocation and redevelopment work. Mr. Burnett has worked on financings of the City and County of San Francisco, City of Oakland, County of Alameda and County of Marin. His redevelopment experience includes work for the Oakland RDA as well as the redevelopment agency for the City of Concord. .... cltrgroUpJ corporate and irwestment banking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 5 Alex will be supported by a day-to-day banking team that will be led by San Francisco-based Director Nikolai Sklaroff, who manages Citigroup's California Redevelopment Agency fmancing effort. Nikolai brings nearly 20 years of public fmance experience as a financial advisor, rating analyst and an investment banker to serve the Agency. Nikolai has recently completed or is currently working on redevelopment transactions for San Jose Redevelopment Agency, San Francisco Redevelopment Agency, Palm Desert Redevelopment Agency, Riverside County Economic Development Agency, Santa Ana Community Redevelopment Agency, Community Development Commission of the City of Oceanside, and the Channel Islands Site Authority. Nikolai will be supported on the day-to-day team by San Francisco- based Director Michael Gomez and Assistant Vice President Carmen Vargas, located in Los Angeles. Michael is one of Citigroup's most senior and experienced municipal bankers on the West Coast, with over 19 years in the business. Carmen is a member of our Redevelopment Agency Finance team, with extensive experience in Tax Allocation Financing including transactions for Riverside County Redevelopment Agency, Palm Desert Redevelopment Agency, Santa Ana Community Redevelopment Agency, Community Development Commission of the City of Oceanside and others. Deepu Chintamaneni, an Analyst in San Francisco, will provide quantitative and documentation support. Brad Thiel, a Director in Los Angeles and Citigroup's Los Angeles-based head underwriter for California municipal securities, will be responsible for pricing the Agency's tax-exempt bonds and Gerard Baker, a Managing Director in New York will be responsible for pricing the Agency's taxable bonds. financing. We have included brief fmancing team resumes under Appendix C. " { \1(':\ BUlIll'tt i \funa;;m:.: IJtn'clor r Sin II,lIlCbLO f "fJ'~"""''''''~-"-" ""_"'M~"'Y", """''''W'Y'',", <"Y W''''''''''''~ "'",~,,_~ flr.udr(lrd Ttlld " PllCf;Mr i 1 ,y \n,l,'ek~ ~ <;'i ~-=~ =" 'J;~ ~::<'-':'",~,iO(r, , (.lO,-'1 ill d B:lJ\.('J' L \f<lJ}U~lll(' Dir('dOl N;;\\ Y Qfk ~ " "-,.,""" v~ v^, " ,,"t'< """"'Y>f~ t, 1:~lU~ MiJkr ~ lJirt'i!ilr ?>;~\'i y ork ~: " ~,~ ~ "fW>J' "'<'::':';<=",%"" ~ ~~='" t .Tohn Ric(' ; 1-!t11ltJ~lH{' nm:i..lm it 'ie\'. Yotk "> ^ '" '" """^ '4""'~"" '" ~l>>' ~ B.S. Provide three issuer/municipality references for the project manager identified above for the type of transaction that the Agency is considering. Be sure to include name, title, address, phone number for each reference and specifically identifY the name, date, and size of the transactions completed for each reference. The table below lists three client references who are familiar with the scope and quality of service that Citigroup provides. We encourage the Agency to contact these individuals to confmn the level of service and expertise that you can expect from Citigroup bankers. Reference fOl 'lex Burnett fC,lIn Rt.'fcrcncc Team Reference RIlA of the Cit~ 01 Oakland RD \ or the Cit~ oj San Jose RD\ for the COllllt~ of Hi,erside Katano Kasaine, Treasury Manager David Banm, Chief Financial Officer Robin Zimpfer, Managing Director City of Oakland RDA of the City of San Jose County of Riverside RDAlEDA 150 Frank H. Ogawa Plaza, Suite 5330 200 E. Santa Clara Street, 14th Floor 1159 Spruce St. Oakland, CA 94612-2093 San Jose, CA 95113 Riverside, CA 92507 Phone: (510) 238-3201 Phone: (408) 794-1120 Phone: (951) 955-6662 E-mail: ICKasaine(Qjoaklandnet.com Email: davidbaum(ii)sanjoseca.gov Email: rzimpfer(Qjrivcoeda.org Financial Advisory Transactions: Senior Managed Transactions: Senior Managed Transactions: $25.0 mm (1993) Tax-Exempt &ID. TABs $10.5 mm (2005A) Tax-Exempt Ref. TABs $144.1 mm (2005) TABs $97.7 mm (1992) Tax Exempt Ref. TABs $119.3 mm (2005B) Taxable Ref. TABs $102.8 mm (2004) TABs $53.6 (1992) Tax Exempt Sub. Ref. TABs $33.1 mm (2005C) &ID. Housing Set-Aside TABs $38.2mm (2004) Housing TABs $135.0 mm (2003) Tax Allocation Bonds $37.0mm (2004) Taxable Housing TABs $13.7 mm (2003) Housing Set-Aside TABs $18.2 million (2005) Ref. Housing TABs B.6. As noted above, the 2006 Bonds are being issued to 1) fund various redevelopment projects, including property acquisition, storm water projects, and traffic improvements, among others, and 2) refund the Agency's 1999 Gateway Bonds in order to relieve the Agency of certain covenants contained in the Gateway Bond indenture. The Agency currently anticipates having approximately $20 million, including funds in the Bond Retirement Account created under the 1999 Gateway bond indenture and funds in the Gateway Bond Reserve Fund, available to contribute to the defeasance of the 1999 Gateway Bonds. Excerpts from the 1999 Gateway Bonds Official Statement are attached hereto as Exhibit A. .... cltlgroUpJ corporate and investmenllianking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 6 While not known with certainty at this time, it is expected that a portion of the property to be acquired with proceeds of the 2006 Bonds may ultimately be used for purposes that would not qualify for tax-exempt financing. It is anticipated that a portion of the 2006 Bonds would be issued on a taxable basis to fund both this use and to refund the portion of the 1999 Gateway Bonds that represented advance refunding bonds. In view of these factors, please describe any structuring recommendations and considerations the Agency should take into account in developing the plan of finance for the 2006 Bonds. Projected revenues available for debt service on the 2006 Bonds are provided as Exhibit B hereto. Since the 1999 Gateway bonds were issued, as noted in the table to the right, the Agency's Project Areas have experienced significant growth in assessed valuation. This growth is a key component to the Agency's credit story, as we will explain in detail shortly, which would allow the Agency to issue bonds on a AAA Insured basis. Further, 221,826,863 $ 611,181,743 176% with the merging of the Agency's four Project Areas, there $ 7,537,905 $ 292,753.101 3784% will now be the advantage of sharing tax revenues from Project Areas that are further along (Gateway and Shearwater) with Project Areas for which redevelopment projects are still in process (Downtown/Central and El Camino Corridor). Citigroup understands that the primary goals of the Agency are to 1) restructure its outstanding debt at a time when market rates are near historic lows, 2) create a new Merged Project Area bond indenture which will remove restrictive covenants contained in the 1999 Gateway indenture - particularly the Sources and Uses: "revenue sweep" into the Bond Retirement Account, 3) release cash available in the Gateway Bond Retirement Fund and the 1999 Gateway reserve fund to defease a portion of the 1999 Bonds and 4) maximize the Agency's future flexibility. Refunding the Agency's 1999 Gateway Bonds - The 1999 Bonds were originally issued to provide both new money and refunding proceeds to the Agency. Thus, only a portion of the 1999 Bonds can be advance refunded with tax-exempt bonds (approx. 60%). The remaining non-advance refundable portion can only be refunded on a taxable basis or through a cash defeasance. The first call date on the bonds is 9/1/2009 at a price of 102%. The Plan of Finance calls for refunding only the non-housing component of the 1999 Bonds. The Bond Retirement Account created by the original 1999 Indenture essentially sweeps all Gateway revenues not used for debt service. As the Agency's [mancial position is on a much more solid footing, it would be more beneficial to the Agency to use any excess revenue for items such as on- going projects and not be restricted to hold these revenues hostage. In addition to the approximately $17.2 million in the Bond Retirement Fund (which can only be used to retire the 1999 Bonds), approximately $2.8 million of Debt Service Reserve Fund from the 1999 Gateway Bonds will be used to defease the 1999 Bonds. It is important to note that bond counsel has determined that the cash available to defease the 1999 Bonds must be used pro-rata between the advance refundable and non-advance refundable portions. As noted above, we have refunded the 1999 Bonds to the first call date at a call price of 102%. The portion of the escrow associated with Cash in the Bond Retirement Account is not yield restricted in the tax-exempt and taxable escrows. However, the Reserve Fund Monies will be restricted to the arbitrage yield on the 1999 Bonds (5.2239%) in the tax-exempt escrow. For the purpose of our analysis, we have yield restricted all the cash available to the old arbitrage yield because the existing flat yield curve in the market makes the difference in the treatment of the Reserve Fund Monies and Non-Reserve Fund Monies in the Bond Retirement Account negligible. We have assumed that the escrow is being invested in State and Local Government Securities (SLGs) and is currently yielding 4.5105%. 61,874,518 $ 264,696,883 328% Tax-Exempt Rei 1 ax-Exempt Taxable Rcl Bonds Bonds i\'C\\ MOlle\ Tot<tl Sources: Par Amount Net Premium Cash on Hand Total Sources 2,070,000.00 2,885,000.00 54,919.85 11,726,739.31 14,666,659.16 63,]25,000.00 2,115,951.70 68,080,000.00 2,170,871.55 20,000,000.00 90,250,871.55 8,273,260.69 10.343,260.69 65,240,951.70 Uses: Deposit to -Escrow Deposit to Project Fund Cost oOssuance Underwriter's Discount Bond Insurance (@7 5 bps) Surety Bond (@3%) Additional Proceeds Total Uses 10,301,586.94 14,602,216.75 24,903,803.69 63,949,260.22 250,000.00 295,661.00 856,199.27 157,620.00 4,970.02 90,417.514.20 63,949,260.22 231,804.50 274,142.18 809.632.45 142,755.00 7,601.35 8,989.70 18,293.43 6,210.00 579.27 10,343,260.69 10,594.15 12,529.12 28,273.39 8,655.00 4,390.75 14,666,659.16 65,407,594.35 2006 ncfundmg 0' 1999 G3tcnaY Bonds Refunding Type Tax-Exempt Refunding of Advance Taxable Refunding of Non. Advance Refundable Bonds Refundable Bonds First Call Date of the 1999 Bonds 9/1/2oo9(@'102% 9/I/2oo9(@'102% Refunded Par AmOlmt $13,990,000 $9,870,000 Refunding Par AmOlmt $2,885,000 $2,070,000 Available Cash $11,726,739 $8,273,261 Present Value Savings ($124,083) ($198,122) , .. I. Cashflow Savings I $16,603,695 $11,225,361 I Average Annual Cashflow Savings I $1,240,029 I $892,082 I True Interst Cost I 4.25% I 5.61% I ..-.. cltlgroUpJ corporate and investment oanking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 7 As summarized in the chart on the previous page, the refunding of the $13.99 million advance refundable component of the 1999 Gateway Bonds using $11.72 million in cash and $2.89 million of tax-exempt refunding bonds results in average annual cash flow savings to the Agency of over $1.24 million from 2006 through 2018. Moreover, the refunding of the $9.87 million non-advance refundable component of the 1999 Gateway Bonds using $8.27 million in cash and $2.07 million taxable refunding bonds with a final maturity in 2012 would provide the Agency with $892,082 of cash flow savings every year from 2006 through 2018. 2006 New Money Financing - In analyzing the Agency's goals as they pertain to the new money financing, we have been guided by two objectives : I) providing maximum flexibility for future fmancings the Agency may wish to undertake, as measured by projected debt service coverage; and 2) satisfying requirements of a 1.25x Additional Bonds Test (which is the standard coverage credit agencies look to for investment grade ratings). Therefore as depicted by the charts below, the Agency can issue up to $63.13 million in tax exempt new money bonds. The bonds are structured to mature from 2006-2029 and will wrap around the afore-mentioned refunding bonds, creating level overall debt service, resulting in a debt service coverage ratio of 1.25x based on the 2005-06 net revenue estimate. This structure will allow the Agency to take advantage of future increment growth without being confmed by back-loaded debt or front-loaded debt. I I $7,000,000 $6,000,000 RedevelopmentAgency of the City of South San Francisco Debt Coverage Analysis $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 ~ ~ ~ Redevelopment Agency of the City of South San Francisco Debt Coverage Analysis $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 L _ 2006 Taxable Refunding &mm12006 Tax Exen-pt Refunding c=J2006 Tax ExBJll>1 New ltbney -2006 t'lcrement Revenue ~ 0 ~ N M ~ ~ ~ ~ ~ m 0 ~ N M ~ ~ ~ ~ ~ a ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ _2006 Taxable Refunding _2006 Tax Exel'fl)t Refunding ~ 2006 Tax Exellllt New M>ney -Ftojected "cremmt Revenue Citigroup is prepared to with the Agency and its Financial Advisors to meet the Agency's needs. We believe our plan of finance meets all of the Agencies goals, in addition to creating new opportunities in maximizes the agencies new money debt. To the right is a Flow of Funds for the Agency's proposed 2006 Issuance. Detailed numerical analysis can by found under Appendix D. Additional Refunding Opportunity In addition to the refunding of the 1999 Gateway Bonds, Citigroup would like to propose the refunding of the Agency's outstanding 1997 Bonds for the purpose of achieving present value savings and combining the 1997 Bond Indenture with the new Merged Project Area Bond Indenture. ~ ~ ~ m 0 _ N M ~ ~ ~ ~ = m 0 ~ N M ~ ~ ~ ~ = m 000 0 ~ _ _ _ ~ _ _ _ _ _ N N N N N N N N N N ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ Redevelopment Agency of the City of South San Francisco Flow of Funds ^ < 2006 Tax. Allocation BO~ :m- -r-' + $66.01 million $2.07 million Tax-Exempt Bonds Taxable Bonds Defeased $23.86 million '. Outstanding Gateway Bonds , , """ ..... cltlgroUpJ corporate and investment banking REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services A summary of our refunding analysis of the 1997 Bonds is shown at right. The 1997 Bonds were issued in an original par amount of $11.59 million, out of which $9.92 million are currently outstanding. An advance refunding of the bonds maturing after 2008 that are callable on 9/1/2007 provides approximately $288,143 of present value savings, or 3.2% savings as a percentage of refunded par. We encourage the Agency to combine this refunding with restructuring of the 1999 Bonds to 1) take advantage of present value and additional cash-flow savings and 2) help consolidate the Agency's debt under the new Merged Area indenture. If the Agency would like to combine the refunding of the 1997 Bonds with the proposed refunding of the 1999 Bonds, Citigroup would be happy to perform additional analysis to show the impact on debt service coverage. CREDIT CONSIDERA nONS 900,000 800,000 700,000 ~ 600,000 ~ 500,000 ~ 400,000 i!i 300,000 200,000 100,000 December 05, 2005 Page 8 City of South San Francisco Refunding of 1997 Tax Allocation Bonds Refunding Par AmlUnt = $8,705.000.0 Refunded Par AImunt =9,130.000.0 PVSavings = 288,142.7 PVSavings as a % = 3.2% Average Annual Savings = $76,971.5 TIC = 4.63% ~ ~ ~ ~ 0 _ N ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ C _ M ~ . ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ _Refunding Debt Service - Unrefunded Debt Service Citigroup believes bonds secured by the merged project area are a good candidate for both bond ratings and Aaa/ AAAJ AAA bond insurance. Additionaly, a debt service reserve surety bond would likely be approved by a number of the insurers. We have assumed both Aaa/ AAAJ AAA insurance and a surety bond in our Plan of Finance. We have prepared an extensive assessment of the Agency's merged project area with detailed information summarized in Appendix E. The combination of the project areas creates a very diversified tax base which enjoys solid overall growth. Conversely, we believe that if the project areas had not been merged, some that have experienced high concentration would not have been good candidates on their own for low priced insurance and good ratings. We believe the Project Area should be able to secure a strong upper median grade rating, based on: 1) diversity of the tax base, 2) ability to withstand the loss of top taxpayers, 3) low volatility risk due to large increment over relatively small base, 4) strong growth of the overall merged project area, 5) strength of payers in the project area and 6) the City's central role in the Bay Area economy. 42.7% 1.25x 1.25x (1) Source: Moody's Rating Approach on California Tax AJlocation Bonds, December 2003. (2) Source: City's FY2004 CAFR Statistical Section end Additional Research (3) FY 2006 Increment provided as Appendix B to the Agency's RFQ. As one of the leaders of the tax allocation bond underwriting industry, we have seen a growing number of insurers willing to ensure strong California Tax Allocation Bonds. Our work with the Santa Ana Redevelopment Agency, for example, made that agency among the first to secure five strong bids from all five triple-A rated insurers. Recently we led the insurer process for the City of San Jose's Redevelopment Agency TABs which also garnered strong interest from insurers. We believe the South San Francisco Redevelopment Agency should see similar interest in its bonds. Our credit team, which includes a former senior rating agency committee member, will assist the Agency and its Financial Advisor to provide a compelling credit story to the insurers. Given how well South San Francisco's growing economy "shows", we would strongly recommend preparing face-to-face credit presentations and site tours for the analysts. We would assist you in preparing such a presentation and since so many of the insurers have Bay Area based analysts, we expect all will want to avail themselves of such a presentation. The Agency's planned issue is relatively large in the TAB world and we expect it to receive strong attention from the analysts. We also expect that the Agency will receive strong bids to provide a debt service reserve fund surety. Because tax increment is a wholly passive revenue stream in California, this is not always the case but based on our discussions with insurers and our past experience, we expect the Agency will receive such bids. ........ cltlgroUpJ corporate and investment bankfng REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO Qualifications to Provide Bond Underwriting Services December 05, 2005 Page 9 B.7. Assuming a tax-exempt par amount of $63 million with a final maturity of 2029 and a taxable par amount of $3.0 million with a final maturity of 2012, and using interest rates as of November 15, 2005, please provide indicative coupons and yields for the 2006 Tax Allocation Bonds. Indicative insured coupons and yields for the tax-exempt and taxable 2006 Tax Allocation bonds are shown below. Tax-Exempt Rates Nll\ember 15, 2005 C:~ ~~ ~"~ = ~: xc< :~< 'y" \-'~;1~- "'~- f :~~v;: ~~7 -= -~ l ~'=;=:~;;I'> ~/A: fu '<-;>'" >1 ; "" "L1\-'4 ox 1> >'<>~ ....&, a8~"'~ ei~k-w ~z ~> ~g<>~,>l, """.1< ~!*,::,:;;:1t;%& x 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 3.10% 4.00% 3.25% 3.50% 3.50% 4.00% 4.00% 4.00% 4.00% 4.00% 4.00% 5.00% 3.10% 2018 3.15% 2019 3.25% 2020 3.35% 2021 3.45% 2022 3.55% 2023 3.65% 2024 3.75% 2025 3.85% 2026 3.95% 2027 4.05% 2028 4.10% 2029 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 4.16% 4.20% 4.24% 4.30% 4.38% 4.40% 4.45% 4.50% 4.55% 4.57% 4.60% 4.62% Taxable Rates No\ember 15.2005 fi~:" ,,: ~ \4x ~-, ~ ~::=~~~~~} :~- ::=~V~~:;: ~ ,}m,;i;,t2}.sZ2 ~2Xl:J'i" ~'" , ~~' j ~ riB 2006 2007 2008 2009 2010 2011 2012 4.85% 4.95% 4.98% 5.03% 5.08% 5.12% 5.15% 4.85% 4.95% 4.98% 5.03% 5.08% 5.12% 5.15% B.8. Please provide a three (3) year history of your firm's capitaL In particular, indicate the amount of capital your firm could put at risk for participation in a single municipal bond transaction (i) as a legal matter, and (ii) realistically in accordance with firm policy and practices. Citigroup is willing to underwrite bonds of significant size on behalf of our clients. Citigroup currently has capital reserves of approximately $16 billion and excess net capital of nearly $2.6 billion, and, as sole manager, could underwrite a single municipal transaction with a par amount in excess of $52 billion, according to the Securities and Exchange Commission's capital guidelines. While many firms have a large capital base, Citigroup has more capital than our competitors and 2,60 3,149 3,298 the total capital position of a securities firm is irrelevant to a municipal issuer if it is not available and committed to Public Finance. Unlike many of our competitors, Citigroup's Public Finance Department is one of our most important investment banking businesses. As a result, Citigroup imposes no internal limit on municipal underwriting liability. B.9. Indicate any jurisdictions where your firm or principals assigned to the Agency's engagement have received any disciplinary actions by the SEe, NASD, or any other federal or state regulatory agency over the last five years. Please provide a description of the circumstances of any disciplinary action. The response to this question may be required. From time to time Citigroup Global Markets Inc. ("Citigroup") and its employees are the subject of inquiries and investigations conducted by federal or state regulatory agencies. Citigroup routinely cooperates with such investigations. In addition, Citigroup is involved in a number of civil legal proceedings and arbitration proceedings concerning matters arising in connection with its business. As a public company, Citigroup Inc., the parent company of Citigroup, files periodic reports with the SEC as required by the Securities Exchange Act of 1934 which include current descriptions of material regulatory proceedings, investigations and litigation, if any, concerning Citigroup. To the best of our knowledge, information and belief, we are not aware of any threatened or pending proceedings, investigations or litigation concerning Citigroup or Citigroup Inc. which could reasonably be expected to have a material adverse effect on Citigroup's ability to perform the services contemplated by the Request for ProposaL Copies of Citigroup Inc.'s periodic reports are on file with the SEC. Citigroup's Form BD is on file with the SEC and with each State. A summary of certain pending litigation is included in Appendix F. B.10. Indicate whether your firm has used or intends to use a "consultant", as defined by MSRB rule G-38, in an attempt to solicit bond-related business from the Agency. Recently, the SEC approved the MSRB's amendments to Rule G-38 banning the use of paid consultants to obtain municipal securities business. Under newly revised Rule G-38, dealer firms are prohibited from paying persons who are not affiliated with the dealer for soliciting municipal securities business on their behalf after August 29,2005. Citigroup has complied with this amendment. ...... cltlgroUpJ corporate and investment banking ~'tH S:4N S o n >< c;: ~ C') to) 0 C'4.l1FO'P-1<'>~ Redevelopment Agency Staff Report RDA AGENDA ITEM #4 DATE: February 8, 2006 TO: Redevelopment Agency Board FROM: Marty VanDuyn, Assistant Executive Director SUBJECT: ASBESTOS AND LEAD ABATEMENT CONTRACT FOR 380 ALTA VISTA RECOMMENDATION It is recommended that the Redevelopment Agency Board authorize the Executive Director to execute a contract with CST Environmental Inc. in the amount of $42,475.90 to complete the required Abatement of Lead Paint and Asbestos at 380 AIta Vista. BACKGROUND/DISCUSSION 380 Alta Vista was acquired by the Redevelopment Agency on April 29, 2005. Since that time, the Agency has completed an initial clean-up of the property, including: dismantling and demolishing five illegal units in the basement area, debris removal, tree trimming, stump removal, weed removal, basic landscaping, building inspections, systems checks (electrical, plumbing, heating), plan design and review, and testing for hazardous materials. Forensic Analytical conducted the testing for hazardous materials in December 2005. They found significant amounts oflead and asbestos. Forensic Analytical concluded that all exterior painted surfaces contain lead as well as all interior painted trim. Additionally, asbestos-containing materials were found throughout the house. Forensic Analytical completed an Abatement Work Plan that addresses what areas ofthe house require abatement and establishes protocols for the abatement. The scope of work includes: removal of most doors and windows, removal of all flooring and wall tile in the bathrooms and kitchen, demolition of significant amounts of wallboard, removal of the deck and stabilization of all exterior painted surfaces. Redevelopment Agency staff invited bids for the abatement work. On January 23, 2006, three abatement contractors attended the mandatory walk-through. Bids were submitted on Friday, January 27,2006. The three contractors submitted bids as follows: CST Environmental for $42,386.30; Janus Corporation for $41,550.30; and Marcor for $48,475.90. CST Environmental submitted the most competitive bid in terms of comprehensiveness, cost, schedule, knowledge and ability. Their bid came in at $42,386.30 and meets all the requirements of the Work Plan created by Forensic Analytical. Staff Report Subject: Abatement Contract for 380 Alta Vista Page 2 FUNDING This contract will be funded through Redevelopment Agency funds. These funds are available for this purpose in the current fiscal year budget. CONCLUSION The Agency is required to abate all known hazardous materials. Lead and Asbestos present a potential danger to any tenants living at 380 Alta Vista. The level/quantity of hazardous materials found on site generated a higher abatement cost than if the levels/quantity had been lower. However, the bid submitted by CST is seen to be fair and reasonable. Therefore it is recommended that the Redevelopment Agency Board approve the attached Resolution and authorize the Executive Director to execute a contract. ~ By' . Marty VanDuyn . Assistant Executive Director Approve Attachment: Resolution Breakdown of Bids submitted RESOLUTION NO. REDEVELOPMENT AGENCY, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA A RESOLUTION AUTHORIZING THE EXECUTIVE DIRECTOR TO EXECUTE A CONTRACT WITH CST ENVIRONMENTAL INC FOR $42,475.90 FOR LEAD AND ASBESTOS ABATEMENT AT 380 ALTA VISTA. WHEREAS, the Redevelopment Agency purchased 380 Alta Vista on April 29, 2005 to alleviate neighborhood concerns; WHEREAS, the Agency is committed to providing safe and sanitary housing to future tenants; WHEREAS, the Agency conducted testing for hazardous materials and found significant amounts of hazardous conditions on the property; WHEREAS, the abatement of hazardous conditions must be completed by a certified contractor; WHEREAS, CST Environmental Inc. is a certified contractor and has submitted the most competitive bid to complete the required abatement work at 380 Alta Vista. NOW, THEREFORE, BE IT RESOLVED by the Redevelopment Agency of the City of South San Francisco that the Redevelopment Agency Board hereby authorizes the Executive Director to execute a contract with CST Environmental Inc. in the amount of$42,475.90 to abate 380 Alta Vista. * * * * * I hereby certify that the foregoing Resolution was regularly introduced and adopted by the Redevelopment Agency of the City of South San Francisco at a regular meeting held on the 8thh day of February, 2006 by the following vote: AYES: NOES: ABSTAIN: ABSENT: ATTEST: City Clerk Comparison of Bids submitted for abatement at 380 Alta Vista CST $38,533.00 $ 3,853.30 $42,386.30 Most competitive bid. Fully inclusive with a feasible work schedule. Marcor $44,069.00 $ 4,406.90 $48,475.90 High bid and failed to include two alternates. Janus $37,773.00 $ 3,777.30 $41,550.30 Low Bid, but not responsive. Did not include budget breakdown and removal of windows. Bid not acce table. AGENDA CITY COUNCIL CITY OF SOUTH SAN FRANCISCO REGULAR MEETING MUNICIP AL SERVICE BUILDING COMMUNITY ROOM WEDNESDAY, FEBRUARY 8, 2006 7:30 P.M. PEOPLE OF SOUTH SAN FRANCISCO You are invited to offer your suggestions. In order that you may know our method of conducting Council business, we proceed as follows: The regular meetings of the City Council are held on the second and fourth Wednesday of each month at 7:30 p.m. in the Municipal Services Building, Community Room, 33 Arroyo Drive, South San Francisco, California. Public Comment: For those wishing to address the City Council on any Agenda or non-Agendized item, please complete a Speaker Card located at the entrance to the Council Chamber's and submit it to the City Clerk. Please be sure to indicate the Agenda Item # you wish to address or the topic of your public comment. California law prevents the City Council from taking action on any item not on the Agenda (except in emergency circumstances). Your question or problem may be referred to staff for investigation and/or action where appropriate or the matter may be placed on a future Agenda for more comprehensive action or a report. When your name is called, please come to the podium, state your name and address (optional) for the Minutes. COMMENTS ARE LIMITED TO THREE (3) MINUTES PER SPEAKER. Thank you for your cooperation. The City Clerk will read successively the items of business appearing on the Agenda. As she completes reading an item, it will be ready for Council action. JOSEPH A. FERNEKES Mayor RICHARD A. GARBARINO, SR Vice Mayor MARK N. ADDIEGO Councilman PEDRO GONZALEZ Councilman KARYL MATSUMOTO Councilwoman RICHARD BATTAGLIA City Treasurer SYLVIA M. PAYNE City Clerk BARRY M. NAGEL Ci ty Manager STEVEN T. MATTAS City Attorney PLEASE SILENCE CELL PHONES AND PAGERS HEARING ASSISTANCE EQUIPMENT A V AILABLE FOR USE BY THE HEARING IMP AIRED AT CITY COUNCIL MEETINGS CALL TO ORDER ROLL CALL PLEDGE OF ALLEGIANCE INVOCATION PRESENTATIONS · American Heart Month, February 2006: Heart Attack and Stroke Prevention Awareness- Fire Chief Phil White; and Proclamation: proclaiming February 9,2006 Wear Red for Women Day, recipient: Lisa Tealer, American Heart Association Boardmember AGENDA REVIEW PUBLIC COMMENTS ITEMS FROM COUNCIL · Announcements · Committee Reports CONSENT CALENDAR 1. Motion to approve the minutes of January 25,2006 2. Motion to confirm expense claims of February 8, 2006 3. Motion to adopt an ordinance amending Title 10 of the SSFMC to add Chapter 10.64, declaring vehicle sideshows a public nuisance 4. Motion to adopt an ordinance amending the zoning map to change the land use designation ofa 0.79-acre site, located at the intersection ofEI Camino Real and BART Drive and adjacent to 1410 EI Camino Real, from Planned Commercial (P-C) to Transit Village Residential, High Density (TV-RH) Zone District PUBLIC HEARING 5. Consideration of Terrabay Phase III Terraces, located on San Bruno Mountain, an amended development agreement, construction of a mixed-use development, including 351 residential units in high-rise (180- units), townhome and loft configuration, a 295,000 sq. ft. office/or 300-room hotel/or an optional 180-unit condominium and 357,500 sq. ft. retail. Applicant/Owner: Myers Development (P04-0117: DAA04- 0001, EIR04-0002, GP A04-000 1, SP A04-000 1, and ZA04-0004) Continued from January 25, 2006-Request to continue off calendar CLOSED SESSION 6. Pursuant to Government Code section 54956.9(b), conference with legal counsel - significant exposure to litigation: one case; and pursuant to Government Code section 54956.9(a) existing litigation: Carlino v. City of South San Francisco COUNCIL COMMUNITY FORUM ADJOURNMENT REGULAR CITY COUNCIL MEETING AGENDA FEBRUARY 8, 2006 PAGE 2 AGENDA ITEM #3 ort DATE: February 8,2006 TO: The Honorable Mayor and City Council FROM: Steven T. Mattas, City Attorney SUBJECT: Adopt an Ordinance to Amend Title 10 ofthe South San Francisco Municipal Code to Add Chapter 10.64 Declaring Vehicle Sideshows a Public Nuisance RECOMMENDATION: Motion to waive reading and adopt an ordinance to amend Title 10 of the South San Francisco Municipal Code to add Chapter 10.64 declaring vehicle sideshows a public nuisance BACKGROUND/DISCUSSION: Council has previously waived reading and introduced the following ordinance. The Ordinance is now ready for adoption. ADOPT AN ORDINANCE TO AMEND TITLE 10 OF THE SOUTH SAN FRANCISCO MUNICIPAL CODE TO ADD CHAPTER 10.64 DECLARING VEHICLE SIDESHOWS A PUBLIC NUISANCE (Introduced on 1/Y/06 Yo.te 5-0) By:,_~J- fh~0 Steven T. Mattas, City Attorney ) /-~ / ( \. (~./\~) Baryy'M}Nagel, 1 y anager 804746-1 ORDINANCE NO. AN ORDINANCE AMENDING TITLE 10 OF THE SOUTH SAN FRANCISCO MUNICIPAL CODE TO ADD CHAPTER 10.64 DECLARING VEHICLE SIDESHOWS A PUBLIC NUISANCE WHEREAS, street racing and reckless driving exhibitions, commonly known as "sideshows," are increasingly becoming a problem for communities in the state of California; and WHEREAS, street races and reckless driving exhibitions are gatherings, processions or assemblages where persons in vehicles engage in reckless stunts and maneuvers on city streets and other public places, often in the presence of spectators; and WHEREAS, the City Council finds that based upon the experiences of other jurisdictions, including the cities of Oakland, Sacramento and San Diego, street races and reckless driving exhibitions can cause chaos and confusion in neighborhoods by interfering with pedestrian and vehicular traffic and by creating a situation where residents and members of the public feel threatened and intimidated; and WHEREAS, the City Council finds that based upon the experiences of other jurisdictions, including the cities of Oakland, Sacramento and San Diego, street races and reckless driving exhibitions create serious traffic problems, interfere with the safe use of streets and sidewalks, result in gridlock conditions, road closures impacting emergency vehicles, the closure of freeway off-ramps and instances where legitimate vehicles and pedestrians are trapped in the middle of these activities; and WHEREAS, the City Council finds that based upon the expenences of other jurisdictions, including the cities of Oakland, Sacramento and San Diego, the operators of vehicles involved in street races and reckless driving exhibitions can disturb the tranquility of residents and threaten their safety by screeching their tires, revving their engines, playing loud music, engaging in reckless stunts and maneuvers, and causing damage or injury to other vehicles, private and public property, and people; and WHEREAS, the City Council finds that based upon the experiences of other jurisdictions, including the cities of Oakland, Sacramento and San Diego, large numbers of spectators often gather to watch street races and reckless driving exhibitions; that the presence of spectators fosters an environment that can encourage an increase in street races and reckless driving exhibitions; and that spectators who gather to watch street races and reckless driving exhibitions often block streets and sidewalks to traffic, form racetrack areas, place bets on races and engage in unruly and criminal behavior including fighting, littering, drinking in public, public urination, trespassing and vandalism; and WHEREAS, the City Council finds that these activities are injurious to the health and offensive to the senses, interfere with the peace and quiet of South San Francisco residents and 804749-1 with their right to enjoy their homes, interfere with the right of business owners to enjoy their property, and interfere with the comfortable enjoyment of life and property of entire communities and neighborhoods in South San Francisco and, as such, constitute a public nuisance; and WHEREAS, the City Council declares that this Chapter is added to reduce crime and the concomitant threats to public health and safety and private property rights by prohibiting the participation in sideshows on city highways and streets and off-street parking facilities and prohibiting the encouragement of illegal activities by providing an audience for illegal street races and reckless driving exhibitions. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SOUTH SAN FRANCISCO HEREBY ORDAINS AS FOLLOWS: Section 1: The Municipal Code is hereby amended to add Chapter 10.64 as follows: CHAPTER 10.64 "PROHIBITION AGAINST SPECTATORS AT VEHICLE SIDESHOW ACTIVITIES AND ABATEMENT OF NUISANCE VEHICLES INVOVLED IN SIDESHOW ACTIVITIES" 10.64.010 PURPOSE. This chapter is adopted to prohibit gatherings for the purpose of participating in, observing or otherwise supporting speed contests or reckless driving exhibitions, commonly known as "sideshows," on the city streets, highways and off-street parking facilities. The purpose of this law is to significantly curb this illegal and nuisance activity. The law targets a very clear, limited population and gives proper notice to citizens of the activities that are considered a nuisance and prohibited under this ordinance. In prohibiting spectators at sideshow activities, the city intends to take a significant step toward making its public streets, highways and off- street parking facilities safe to pedestrians, motorists and the general public. 10.64.020 DEFINITIONS For purposes of this Chapter, the following definitions shall apply: A. "Sideshow" means any gathering of persons to participate in and observe any motor vehicle speed contests or motor vehicle exhibitions of speed defined or described in the California Vehicle Code section 23109 or any reckless driving exhibition as defined or described in California Vehicle Code section 23103. B. "Spectator" means a person who is present at a sideshow, or the site of the preparations for these activities, for the purpose of viewing, observing, watching or witnessing either ofthese activities without regard to the means by which the person arrived. C. "Present" means a person is within 200 feet of the site of a sideshow exhibition, or within 200 feet of the site of the preparations for these activities. 804749-1 D. "Preparations" for any sideshow include, but are not limited to, any of the following acts done for the purpose of the sideshow: 1. one or more motor vehicles or persons have arrived at a predetermined location; 2. one or more persons have impeded the free public use of a public street or highway or offstreet parking facility by acts, words or physical barriers; 3. one or more vehicles have lined up with engines running; 4. one or more drivers is revving his or her engine or spinning his or her tires; or 5. a person is acting as a race or sideshow starter. 10.64.030 VIOLATION - SPECTATOR AT A SIDESHOW A. It shall be unlawful for any person to be a spectator at a motor vehicle speed contest or motor vehicle exhibition of speed conducted on a public street or highway or on private property open to the general public without consent of the owner. B. It shall be unlawful for any person to be a spectator at the location of preparations for a motor vehicle speed contest or motor vehicle exhibition of speed conducted on a public street or highway or on private property open to the general public without consent of the owner. C. Nothing in this section prohibits law enforcement officers or their agents who are acting in the course of their official duties from being spectators at a street race or reckless driving exhibition or spectators at the location of preparations for either of these activities. 10.64.040 RELEV ANT CIRCUMSTANCES TO PROVE A VIOLA nON Notwithstanding any other provision of law, to prove a violation of this Chapter, admissible evidence may include, but is not limited to, any of the following: A. time of day; B. nature and description of the scene; C. number of people gathered at the scene; D. number and description of motor vehicles at the scene; E. whether vehicles gathered at the scene are engaged in vehicular stunts and maneuvers; 804749-1 F. whether the individual charged has previously participated in or aided and abetted in a sideshow. 10.64.050 ADMISSIBIL TY OF PRIOR ACTS The list of circumstances set forth in section 10.64.040 is not exclusive. Evidence of prior acts may be admissible to show the propensity of a person to participate in if the prior act or acts occurred within three (3) years of the presently charged offense. These prior acts may be admissible to show that a person had knowledge that a sideshow activity or reckless driving exhibition was taking place at the time of the presently charged offense. 10.64.060 NON-APPLICABILITY This ordinance does not prohibit members of law enforcement, the medical profession or any other legitimate service provider form being present at a sideshow or a reckless driving exhibition while in the course of their official duties. 10.64.070 ENFORCEMENT-PENALTY In addition to any other penalties authorized by law, the prosecuting agency may charge a violation of this ordinance as an infraction or a misdemeanor. A misdemeanor may be punishable by a fine not to exceed $500 for the first offense, $750 for the second and $1000 for any subsequent offense. A misdemeanor may also be punishable by imprisonment not to exceed six (6) months or, by both a fine and imprisonment. 10.64.080 ABATEMENT OF NUISANCE VEHICLES BY SEIZURE AND FORFEITURE A. Nuisance vehicles. Any vehicle used as part of a sideshow or in violation of California Vehicle Code Section 23103 relating to reckless driving is declared a nuisance, and the vehicle shall be enjoined and abated as provided in this ordinance. Any person or his or her servant, agent, or employee who owns, leases, conducts or maintains any vehicle used for any of the purposes or acts prohibited is guilty of nuisance. B. Declaration by court. Upon proof that the vehicle was used as part of a sideshow, the court shall declare the vehicle a nuisance and order that it be forfeited, sold and the proceeds distributed as provided by this ordinance. C. Right, title and interest in property. All right, title and interest in any vehicle that constitutes a nUIsance under this ordinance shall vest in the city. 804749-1 D. Procedure for Seizure of Vehicle. 10.64.90 1. Vehicles subject to forfeiture under this ordinance may be seized by a peace officer upon process issued by a court having jurisdiction over the vehicle. Seizure without a court order may be made if any of the following situations exist: a. The seIzure IS incident to an arrest or a search under a valid search warrant; b. There is probable cause to believe that the vehicle was used in violation of this ordinance. 2. A peace officer seizing a vehicle shall complete a receipt in accordance with Section 1412 of the Penal Code and deliver it to the person out of whose possession such vehicle was seized. 3. An investigation shall be made by the public agency making the seizure as to any potential claimant to a vehicle whose right, title, interest or lien is of record in the Department of Motor Vehicles of this or any other state or appropriate federal agency. If the public agency finds that any person, other than the registered owner, is the legal owner, and the ownership did not arise subsequent to the date and time of arrest or seizure of the vehicle or notification of the forfeiture proceedings, it shall within three (3) business days of the vehicle's seizure, send a notice of seizure and notice of a hearing to the legal owner at his or her address appearing on the records of the Department of Motor Vehicles of this or any other state or any appropriate federal agency. 4. Where appropriate, a vehicle seized pursuant to this ordinance may be held as evidence in any proceeding brought by the prosecuting agency. SEVERABILITY The provisions of this ordinance are severable, and if any word, clause, sentence, paragraph, provision, or part of this ordinance, or the application of this ordinance to any person, is declared invalid, preempted or unconstitutional by any court, said holding shall not invalidate any other portion of this ordinance. The City Council finds and determines that it would have adopted this ordinance without said work, clause, sentence, paragraph, provision or part. Section 2: Publication and Effective Date. Pursuant to the provisions of Government Code Section 36933, a summary of this Ordinance shall be prepared by the City Attorney. At least five (5) days prior to the Council meeting at which this Ordinance is scheduled to be adopted, the City Clerk shall (1) publish the Summary, and (2) post in the City Clerk's Office a certified copy of this Ordinance. Within 804749-1 fifteen (15) days after the adoption of this Ordinance, the City Clerk shall (1) publish the summary, and (2) post in the City Clerk's Office a certified copy of the full text of this Ordinance along with the names of those City Council members voting for and against this Ordinance or otherwise voting. This ordinance shall become effective thirty days from and after its adoption. * * * * * Introduced at a regular meeting of the City Council of the City of South San Francisco, held the 25th day of January 2006. Adopted as an Ordinance of the City of South San Francisco at a regular meeting of the City Council held the 8th day of February 2006, by the following vote: AYES: NOES: ABSTAIN: ABSENT: ATTEST: City Clerk As Mayor of the City of South San Francisco, I do hereby approve the foregoing Ordinance this 8th day of February 2006. Mayor 804749-1 AGENDA ITEM #4 art DATE: February 8,2006 TO: The Honorable Mayor and City Council FROM: Steven T. Mattas, City Attorney SUBJECT: Adopt an Ordinance to Amend the City of South San Francisco Zoning Map to change the Land Use Designation of a 0.79-Acre Site, located at the intersection of EI Camino Real and Bart Drive and Adjacent to 1410 EI Camino Real, from Planned Commercial (P-C) to Transit Village Residential, High Density (TV -RH) Zone District RECOMMENDATION: Motion to waive reading and adopt an ordinance to amend the City of South San Francisco Zoning Map to change the land use designation of a 0.79-Acre Site, located at the intersection of EI Camino Real and Bart Drive and adjacent to 1410 EI Camino Real, from Planned Commercial (P_ C) to Transit Village Residential, High Density (TV-RH) Zone District BACKGROUND/DISCUSSION: Council has previously waived reading and introduced the following ordinance. The Ordinance is now ready for adoption. ADOPT AN ORDINANCE TO AMEND THE CITY OF SOUTH SAN FRANCISCO ZONING MAP TO CHANGE THE LAND USE DESIGNATION OF A 0.79-ACRE SITE, LOCATED AT THE INTERSECTION OF EL CAMINO REAL AND BART DRIVE AND ADJACENT TO 1410 EL CAMINO REAL, FROM PLANNED COMMERCIAL (P-C) TO TRANSIT VILLAGE RESIDENTIAL, HIGH DENSITY (TV -RH) ZONE DISTRICT By: // as, City Attorney (----' \ ,~ \ {' "- j ',J3~ . . <ag~Manager 804743-1 ORDINANCE NO. AN ORDINANCE AMENDING THE CITY OF SOUTH SAN FRANCISCO ZONING MAP TO CHANGE THE LAND USE DESIGNATION OF A 0.79-ACRE SITE, LOCATED AT THE INTERSECTION OF EL CAMINO REAL AND BART DRIVE AND ADJACENT TO 1410 EL CAMINO REAL, FROM PLANNED COMMERCIAL (P-C) TO TRANSIT VILLAGE RESIDENTIAL, HIGH DENSITY (TV-RH) ZONE DISTRICT WHEREAS, the 0.79-acre site is designated "Planned Commercial" in the 1999 General Plan; and, WHEREAS, the proposed development generally complies with General Plan goals and policies, specifically General Plan policy 3.4-G-3, which encourages the development ofthe South San Francisco BART station area as a vital pedestrian-oriented center, with a intensity and mix of uses that complement the area's new role as a regional center. The Transit Village District also implements General Plan Implementing Policies 3.4-1-3, 3.4-1-5, 3.4-1-6, 3.4-1-7, 3.4-1-8, 3.4-1-9, 3.4- 1-10 and, 3.4-1-11 that require the establishment of a pedestrian-oriented transit village, with transit- supportive development requirements, within 12 mile ofthe South San Francisco BART Station.; and WHEREAS, on November 3, November 17, and December 15, 2005 the Planning Commission ofthe City of South San Francisco held duly noticed public hearings and recommended that the City Council adopt the proposed ordinance amendment; and WHEREAS, an Environmental Impact Report analyzing the impacts of the General Plan update was prepared and certified by the City Council of South San Francisco on October 13, 1999, in accordance with the provisions of CEQA; and WHEREAS, an Initial Study/Mitigated Negative Declaration has been prepared for the project in accordance with the provisions of CEQA. Mitigation measures have been incorporated into the project, which will reduce all the identified impacts to a less than significant level. The City has also prepared a Mitigation Monitoring and Reporting Program. NOW THEREFORE, the City Council of the City of South San Francisco does hereby ORDAIN as follows: SECTION 1. AMENDMENTS The City Council hereby amends the City of South San Francisco Zoning Map for 1410 El Camino Real by changing the zoning designation of the 0.79-acre site, currently part of the South San Francisco BART property located at the intersection of EI Camino Real and BART Drive, from Planned Commercial (P-C) to Transit Village Residential, High Density (TV-RH). SECTION 2. SEVERABILITY If any provision of this ordinance or the application thereof to any person or circumstance is held invalid, the remainder ofthis ordinance, including the application of such part or provision to other persons or circumstances shall not be affected thereby and shall continue in full force and effect. To this end, provisions of this ordinance are severable. The City Council of the City of South San Francisco hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, clause, or phrase hereof irrespective of the fact that anyone or more sections, subsections, subdivisions, paragraphs, sentences, clauses, or phrases be held unconstitutional, invalid, or unenforceable. SECTION 3. PUBLICATION AND EFFECTNE DATE This Ordinance shall be published once, with the names of those City Councilmembers voting for or against it, in the San Mateo Times, a newspaper of general circulation in the City of South San Francisco, as required by law, and shall become effective thirty (30) days from and after its adoption. * * * * * * Introduced and adopted at a regular meeting of the City Council of the City of South San Francisco, held the _ day of , 2005. Adopted as an Ordinance ofthe City of South San Francisco at a regular meeting of the City Council held the day of, 2005 by the following vote: AYES: NOES: ABSTAIN: ABSENT: As Mayor of the City of South San Francisco, I do hereby approve the foregoing Ordinance this _ day of ,2005. Mayor l'--;'~ l rJ. CLER~ rEB 2~eS PM 2:42 AGENDA ITEM #5 MYERS DEVELOPME T COMPANY February 2, 2006 Ms. Sylvia Payne Office of the City Clerk City of South San Francisco 400 Grand Avenue South San Francisco, CA 94080 Re: Terrabay Phase III Dear Ms. Payne: We respectfully request a continuance (off-calendar) of the Terrabay Phase III agenda item that had been scheduled for the February 8th City Council Meeting Thank you. Sincerely, MYERS DEVELOPMENT COMPANY / S. Shepherd Heery Senior Vice President cc: Allison Knapp, Tom Sparks, Jack Myers SSH/sp 1 () 1 Second Sueet, ~;llire C;'),) . San Francisco, CA 941 OC; . -ldephone: (41 ')) -77-3.nO . fax: (41')) 777-333] 'y,lWW. myersdevd op men Leo m