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HomeMy WebLinkAboutReso 95-1982RESOLUTION NO. 95-82 CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA A RESOLUTION RETAINING THE FIRM OF BARTLE WELLS ASSOCIATES AS FINANCIAL ADVISORS IN CONNECTION WITH THE SALE OF ASSESSMENT BONDS FOR THE GATEWAY' PROJECT that. BE IT RESOLVED by the City Council of the City of South San Francisco 1. The firm of Battle Wells Associates be and is hereby retained to act as financial advisor to the City of South San Francisco in connection with the planning and sale of assessment bonds related to the Gateway Project upon the terms and conditions set forth in the document entitled, "Proposal to City of South San Francisco, Bartle Wells Associates, Municipal Financing Consul- tants,'' which proposal is attached hereto as Exhibit "A" and incorporated here- in by reference as though set forth verbatim. I hereby certify that the foregoing resolution was regularly introduced and adopted by the City Council of the City of South San Francisco at a regular meeting held on the 4th day of August , 1982, by the following vote: AYES: Councilmembers Ronald G. Acosta, Mark N. Addiego, FmanuelP N. Damonte, Gus Nicolopulos; and Roberta Cerri Teglia None None NOES- ABSENT. Foundry pattern for reverse side of 45-inch manhole cover. Bartle Wells Collection Bartle Wells Associates maintains a rotating collection of restored foundry patterns in its offices in San Francisco. These hand- crafted, wooden shapes were used to make sand molds from which metal castings were formed. The patterns originated in various projects of the West's development. We think it is fitting that these symbols of public works, often financed through our efforts, should accompany the materials which describe our firm. '111 '1 ;I] '[July,., '~ 1982 Battle Wells Associates Municipal Finan¢in~ 1636 Bush Stree~ San Francisco .o4109 415 775-3113 ity of Sguth San Francisco .30 Grand Avenue South San Francisco CA 94080 Attention: Mr. C. Waiter Birkelo, City Manager Subject' Assessment Bond Financing We are pleased to submit this proposal to the City of South San Francisco to provide financial consulting services in connection with redevelopment agency t[inancing and a proposed sale of assessment bonds. Our proposal includes: (1) scope of work, (2) availability and fees, (3) experience and references, and (4) personnel qualifications. To work with yqu we propose to assign Thomas E. Gaffney and Lora J. Stovall, both partners of Battle Wells Associates. Other members of our firm will assis{ as needed. Su_n>maries of our consultants' qualifications are included in the "Staff" section ol- this proposal. We are prepared to berlin work upon acceptance of this proposal. We anticipate a sale of assesement bonds about September 1982. Battle Wells Associates is owned and managed entirely'by its own staff. We are engaged exclusively in providing municipal financing consulting services for public agencies. Because we are not connected with any bond sales organization or' uneterwriter, we can exercise completely independent judgment and make objective --ecommendations with respect to ]financing pIans and the marketing of securities. lartle Wells Associates has national recognition and leadership in professional. municipal financing, consulting. The firm's expertise and experien, ce includes developing and implementing Virtually every type of municipal capital improvement project: airports, electric power, flood control, parks, parking; ports, public buildings, reclaimed water, schools, sewerage, solid waste, streets and highways, water supply, water system acquisition, and urban renewal. Our overall objective will be to create a viable financing plan to implement the capital improvement needs and desires of the city. We believe most issuing agencies will now seek the highest quality o.fficial state- ment preparation to protect the individual public officer certifying the accuracy of the information and to meet bond undem~riters' full-disclosure requirements. Ou_r task is to assist the issuer !n providing relevant, compre, hensive financing information, and to obtain the lo, est possible interest rate on the notes or bonds being offered. The services we provide consistently meet these objectives. We sincerelv appreciate vour invitation to submit this proposal, and hope that it' will provid~ a 'sidtable b~sis for our selection. We will submit a draft consulting services aqreement suitable for review by the city's legal advisor. We will begin work upon-written authorization from an appropriate city official. Yours very truly, BARTLE WELLS ASSOCIATES Thomas g. Gaffney President TEG'mt 3K Sale and Delivery of the Bonds- We will analyze all quotes and bids receiv.e_d in detail, select the lowest bid at the sale, conduct further negotiations necessary, make recommendations to the city as to award of the bonds, and assist counsel in preparing the resolution of award. We will act as a~qent fOr the city. if further negotiations are required. We will furnish a schedule of annual interest and. principal pa. Tfments required on the basis of the coupon rates specified in tlue winning bid. ADDITIONAL SERVICES We will be ~available to provide additional financing .consulting services, whether before or after the. sale of notes, as requested by the city. AVAILABILITY AND FEES 1. We are prepared to begin work for the city upon acceptance of this proposal. 2. During the project development period, we will be available at all reasonable times and on reasonable notice tor meetings and for consultation with the city cquncil, its staff, consulting engineers, bond dealers, rating analysts, aha others as necessary. 3. "All. work will be performed by Battle Wells Associates and those special con- sultants with whom we are regularly associated..One of our principals will be placed in charge of the work and will devote his time and effort to the project as needed. 4. Our fee for the services described in this proposal is as follows: a. For all services related to this sale of notes, commencing 120 days before the estimated date of sale and continuing for up to 60 days following the sale, the fee is $15,000, plus direct expenses. Progress payments, plus direct expenses, are payable a.s the work proceeds as provided in our billing rate schedule 161~{. Eighty percent of the fee, plus direct expenses, is payable as provided in schedule 16M upon completion the official statement, wfth the balance due upon sale of the notes. b. Any additional services not included above, as authorized, will be pay- able as provided in our billing rate schedule then in effect. 5. Employment under this proposal is limited to a maximum of 8 months from thi dhte of authorization tb proceed, or until. April 30, 1983, if earlier. Services provided thereafter will be billed at the then-prevailing billing rate schedule. Any fees or fee limitations for work remaining will be propor- tionately adjusted. . 6. We will not requ.ire a formal contract of employment and will consider a letter from an approprmte official as sufficient authority to proceed. Thomas E. Gaffney President ~[uly 2, 1982 Enclosures PROPOSi~J~ TO CITY OF SOUTH SAN FRANCISCO BARTLE ~q~LLS ASSOCIATES Municipal Financing Consultants Battle Wells Associates will perform the following services in connection with the planning and sale of.assessnient bonds fpr the City of South San Francisco, work- ing at all times in close cooperation with the city staff and its other cons.u!tan.ts anal advisorS, We under?tend that assessment proceedings have been initiated pursuant to the Municipal Improvement Act of 191_3, and _that improvement bonds shall be issued pursuant to the Improvement Bond Act of 1915. NOTE SALE SERVICES 1. Preparation for Sale - We will assemble, review, and analyze pertinent data thai has a bearing'on the_financing program. This ~ill include review of available new information that serves as a basis for making the best pre- sentation to the rating agencies and underwriters. Based on our refriew and analysis we will recommend the terms and conditions for sale of the bonds, including the maturity schedule, date and methods of sale, provisions fqr call and redemption and other conditions designed to improve the salability ', of the bonds, and provlde.flexibili. . ty in repayment.. We will work with .the ci~ staff and its consultants m revmwmg the financing program, and w~th legal counsel in preparing the necessary notice of sale and resolution of issuance. 2~ Rating Services - If rating services seem advisable, we will provide infor- mation to ~e rating agencies in s. uch form and at such times as to obtain a favorable rating on the bonds prior to their actual sale. Potential bidders will be .n, otified of such ratings prior to the sale. We will advise the city on possible methods of enhancing the bond ~ratings, such as municipal bo, nd insurance and/or other features, e.g., a letter of credit or contractual support from outside entities. 3, Invitation for Bids - We willprepare the text for the official statement describ- ing' the bonds, the ciW anci its project, the financial resources of the city and the p, roiect, and the economy and resources of the area. The completed drafts will be revi.e~,ved by the ciW staff. We will then print at least 100 cop!.e.s of .the official statement and send it, along, with copies of the notice inwtmg bids, to dealers, investqrs, rating agencies, and others inter, eared i~n the project or the bonds. At least 20 copies will be furni_shed to_the city ior its use. We will prepare announcements for insertion in the Bond Buyer and other publications. Dealer Contact - We will contact directly major assessment bond dealers in order to stimulate co~petition in biddin~l and will prepare special announce- ments for dealers and for .financial pu_b]ications. We will answer inquiries and re uests for further reformation from prospective purchasers of the bonds and take other appropriate steps to ]~ami[larlze dealers vnth the clt7 and the bonds. Preliminary Quotes -'We will request quote from qualified assessment bond dealers Ul5 to a fixed time, .to be established. Based on the preliminary ~uote that is in the sole o' nnion .of the city, most favorable, we will select i~e bond un~fer~Titer. At this time we will advise as to whether further negotations would benefit the city, and will conduct any such negotiations. BARTLE WELLS ASSOCIATES BILLING RATE SCHEDULE 16M 1980/81 AND 1981/82 PROFESSIONAL SERVICES 1. Fees for professional services are based on hourly rates for pro- fessional level personnel as follows: Research Consultant Staff Consultant Consultant Senior Consultant Principal Consultant $36 48 60 75 90 Travel time between 7 AM and 6 PM is not charged when the total time spent on the job that date exceeds 8 hours. 2. The billing rates for professional'services, based on professional personnel time only, include all consultant, administrative, and secretarial salaries~ and overhead and indirect costs as follows: property and income taxes routine postage and delivery library maintenance costs accounting and legal services liability and casualty insurance state disability and workers' comp. memberships and subscriptions health, disability & pension premiums rent and supplies local telephone office machine costs social security professional development business license fees unemployment insurance sick leave and vacation DIRECT EXPENSES Direct expenses, not included in the billing rates for professional services, are separately billable as incurred at cost plus ten percent and include: air and surface transportation, subsistence, telephone toll charges, printing and binding, statistical services, computer charges, word processing, photography and illustrations, graphic design, legal services, postage and mailing, bond rating services, and advertisements. PAYMENT Billings will be made monthly as professional services are rendered and direct expenses are incurred. Bills are payable within 20 days of the bflting date. ".-2-~_~i:~'N~'' ~',t~ ,'~= '~-~-~'~ ..:~.-.'.'-..'. 7.." ': ',..~..... '- ' · .-".' . i'' .'.-' "'.' .... .. ': ..' .' t" ', .':)~.::!, :,....:/~..'"-'.~.: :'..'." .' ~.,~"i~t~_.',; ~ ~,-~x,aI ~ ~,a-,ax~,a ...' ,.-~,: ..., ..: .... ::'~:', · ...... ' ,," .. :.. ' ' ' ' · .. ; .... ' ~-:'-'.~.-'.2,~',&':;..~.' · -.~.'r~.~" ......' ........ '..:-'. · · '". '.' ' '..':- · ·" · ' .: .. '" -. ' . · '.'". .... ::" ' .. ·" ", ."- '. ;:~.-.~'-.-..-~"~ ' '~'~ ''"', '~" ' " ' :'" :'" ~ ~'I"'~"~'~ ' ."~"'"'~ ~' '" ":' r'' ,.. '..:... ..., .' . . ' ., :...' .t.,',.,-,j~..~'.;?/.'~, ~' : .~i;~,"i. Portland ':?~';.:'~',~:.'..,;::'*.~.'.,:'..?;'.","" .~;, :,'-'? ~.'.'..'"..';::,.: .'::"..-'-.'-.: ,':'~ '"' · .'Y :.:"-',:. ' "- · ::' '- :."-.' '- · ~.'"';- : '. ;::'.".':"'"'~:~'"~i~;? ~! · I .,?~'~'.~' '~' · · ' '~ '.- .-'~.,".:' · .... 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"':'...',:.'::.,?:,~. ,?.".: ..'.' .'.' .'.'> ,~'.:"~'"',':..~.< ":' .:..: ~"!, . ' ' , · .... · :'-.?,,..'.' '.'-: · ~., · · -"-' .'~i~.~:.~,.':':~": ;~-~z;,, :., .' ' . ".'. ,,. · .: .',-;:'...' '., ,:,-;.. -: · ' '. ,.' . ,' .~ : ' .'. ." -' .:' " ' '.' '".. "~.-,,'¢,~.~., '.:'.' '"-".?";~'~,.2'~'.2';'., .... " .... ,;2'..',':'~--<"~;~:.-.'".-",:.' . .': . '.'~':".~" ." .. ".. - '- "'. ~-" .. ... '~ :.,.. ..... -~. ,..~?~:, .:'~... '...' : .... ..- .. ~.~.:-,'~.i,-~;,_~ . ~,~,,,~:.~.,~ .... . .:,:,.~'~,: ...... .,:~.~'.~'",,~,;~,.:.~,..:,,'~;~.,,.'~,'..'~:,'.~ .:.,.,,:....: ..,~,:...... ~,,~, .. :,-:.... :.· ..:-'.~. ,':-: ~:,'.,.,.,?.. ........ · .:, -' . .-'.'..,.~ .;.,z~.,~ ,.... ....,,;~,~ ¥ ......................... ~ ......... '~'~"-'. ..... '~"' ................. ~:,~,#~'.~',,."',~.-'...':~,-. :. ........ :,~-'~-~.~....~.,%i:~,;~'a.:~.-~,~ ~ ..,~_I,__~..~,..~,.~:;~,- .... ;,~ ?-, r ~..~,~?~,~.,~C?-,;~,:.-.~,:~4.T.;~,-~;~..:.:~-,~ .~d.~&,:.~ .-,<...:.. 7..-:,-,-~ .. .... . .... ' ',; :~': .' ? ":: , '":'~ :-. ~-:':~:- '7"' ' ,.."· ,' "' .~','~'~ .... ', ~'~,~ .... ~n~ · "'"~'~c". '.': ' ' ' '" .... - ', .'".'-:' .... :'~ ' "' '" ' ." o · '~. :',' ' ' ' ...... ' ' ~, "." ': ~.':'"~. ' "- ,'. *' · ~";", ~'.nonprofit corporation lease-revenue '" Bartle Wells Assocmtes .... · MWD of Orange Coun't~'- ".:' '~: .... · ' bond issues. "" ' ' : .... ' Bond Marketing Clients ,.., . :. ,' .~. ~ '.. .., · A financing consultant's j~b is to . - Alameda County ~" · facilitate the financing of public works Alameda CWD · " ..... projects by, local governments.. A client . Antelope Valley-East Kern WA -'. .:".. uses a financing consultant· to C.o. nvert . State Highway Commission its project concept into a reality/at a "Bear Valley Community Hosp. Dist.. '. ?'.. favorable borrowing cost.: The consul- Belridge WSD ':"r!'2.'~'tant can help the issuer ac~6mplish this '''!''''''~' Cit of Bend, ore on · .?~!~objective by working closely..with the .'?":~t'~'i City of Benicia (i;~.~.'agency staff and bond counsel,' by '?:.:i:ii. Berrenda Mesa WD ..'.i:-':'~'developing rating agency ~nd bond i '"':":" Big Bear Area Regional WA ..'~dealer confidence through the distrib'u~' i." Big Bear City CSD ",:~i;~..,.ition of carefully prepared official state-".' Butte County ' i.:'~'a:nents, and through information meet-· ' '~. City of Carlsbad ' ;~.~(-~'?i~ngs for underwriters-,' ". "" ..': .-- ' i....:::~;.Ca~taic Lake Wa' ' ~':'-.'~.,.. . · ..... '.'..'.. -: .... ..' ':'"":' ter Agency '.'t:~.,:..~'.":"Following is a list of representative "City of Chico '!~:'bond sales.. ' ........ "'"' ' ..... . ,,~Y-:';;~'~i-,,r.'j'3"-,,;?.."~_:'~'..'~' :'. .., . . ,:-..-k':... ::.':i .-..x:~,:,'.'. ;. ,~t.,~.,:;~'~ ..... '..... .. ' . Chino Basin MWD · .-~:;"- · Clackamas County, Oregon .z~.city of Carlsbad ' $ 3,035,000 : Clackamas CSD No. 1, Or. 6,095,000 ..... City of Eugene, Oregon 28,565,000 Fairbanks NSB, Alaska .32,500,000 !'-': Lane County, Oregon, - 5,950,000 .. School District No. 4J Los Angeles County SE 22,500,000 ..'..- General Hosp. Authority '" Monterey Regional PCA 18,000,000 · MWD of Orange County .79,400,000 State of Oregon, " 125,000,000 · Dept. of Veterans' Affairs City of Palo Alto .... . 6,450,000 · Phoenix Civic Plaza 19,000,000 Building Corporation City of Redwood City ' 11,800,000 Richmond Redevelop- 1,475,000 ment Agency Riverside County 24,000,000 FC&WCD Sacramento-Yolo Port Dist. 28,225,000 Santa Clara County Building Authority Solano County Tahoe-Truckee SA Travis Wastewater Auth. Ven tu ra County .PFC 19,400,000 6,900,000 4,500,000 7,165,000 58,500,000 City of Coalinga Contra Cqsta Junior College District City of Cottage Grove, Oregon Crockett-Valona SD Cucamonga CWD City of Cypress City of Eugene, Oregon City of Fairfield Fairbanks North Star Borough, Alaska Fairfield-Suisun SD City of Fresno City of Fort Bragg Humboldt County City of Indian Wells City of La Palma City of Lake Oswego, Oregon Lane County, Oregon Lane County School District No. 4J City of Larkspur City of Lincoln City, Oregon Los Angeles County Marin County SD No. 6 City of Martinez City of Modesto Montecito SD Morrow County School District No. 1 Mountain View SD Oak View SD ~.,,'.,.,:~-",': :- · ~,.'. :.'~,%:. ,~: Orange County "'/.,'"'iki":':': ' Orange County SD No. 7.' State of Oregon: ' .--' ~'~: '~:!". · ..': :."L" .f" .' · --Dept. of Environmental --Dept. of Higher Education .,-Dept. of Veterans' Affairs City of Oroville City of Palo Alto City of Phoenix, ArizSh'~ :"i. ' ::':' City of Pleasanton ' .'-.:.~','.'::'~;-:..'. Rancho California wD City of Red Bluff ...... -, c~.: ...... ,.. '~,~ ,...'.. ~, .. City of Redwood City · ......... Richmond Redevelopment Agency Riverside County FD & WCD . . City of Roseville -' . .... .. ... Sacramento-Yolo Port District San Bernardino Valley MWD City of San Clemente . . City of San Diego San Francisco Bay Area RTD City of San Juan Capistrano Santa Clara County Santa Margarita WD City of Saratoga Seaside CSD Selma-Kingsburg-Fowler CSD "~ Sewerage Agency of Southern Marin Solano County Sonoma Valley CSD :.·-: City of South San Francisco ' City of Springfield, Oregon Tahoe-Truckee Sanitation Agency Travis Wastewater Authority Triunfo CSD Tulare Lake Basin WSD City of Tustin United WCD City of Veneta, Oregon Ventura County Washington County, Oregon West San Bernardino C-3ND MUNICIPAL FINANCING SERVICES. '~..::i~ii ~i) i! ' .... ., . r ~ ' ' ".~.,~,t '~? ." · ' ......... ~ ......... .'.. ~....~'.~ ...... .:~.. ~' g.~. '. . ' ' ' :-' ~.r; ~ '.. ~ ', . .· ~ ' .~ ~,~~~' .g-~'~ - ' '- '."."~*' , .'." · "·. ' '. 'o .~'- ~ :f~" , ~.. ~%; '~.~ ..... . '.~ ,~-.~"~~,,,..... . ... .... ~.~..:~::i~.. ....... . ,.... : .: ,..:.~.~.,, ·: '~.. ;. , ~. ,....~.~~,:~ ;~ ...:... ~ · .~ ~', ~ .... · "L' ""*~.~',.~. , .' ". , - -..~.~-~g,.~: .......... . ~ .': ':'5~¢ · ? =~ :~ :~.: ...... . ~, :.'.. .... ?...' :~. '~~.:., .' Skilled Fin~cing Consulters · ~. of an expe6enced financing consultant/t~:'~:~: the offer and sale of their secu~fies. Can Save You Money Battle Wells Associates is an indepen- dent financing consulting firm, formed in 1964. Since then our organization has completed over 200 bond market- ing assignments for more than 100 public agencies, involving the sale 0f~f over S1 billion in municipal bonds. Clients served have ranged from smail districts in unincorporated areas to major metropolitan governments, cities, counties, and state agencies, as well as special regional agencies includ- ing up to 25 separate entities. Bringing a bond issue to market so as lo attract vigorous competitive bidding involves a combination of technical knc~vledge, communication skill, and .g experience. Bartle Wells t\ssociates' bond marketing experts are ready to assist any type of public agency in the sale of municipal bonds. Our services include: · Briefing public information for bond elections · Preparing tax rate statements and ballot arguments · Drafting bond terms, conditions, and covenants · Assisting legal counsel in conducting formal bond proceedings · Preparing and distributing official statements, press releases and advertisements · l~resenting financial data for bond rating agencies · Encouraging competitive bidding th rough underwriter contac ts · Conducting bond dealer 'tours and information meetings · Analyzing bids, awarding bonds, and assisting with delivery To obtain a low interest cost the public agency should use the services Each year billions of dollars of munici,.':::'! ': .The task of the financing consultant is pal bonds compete for the attention of .~. to assist the issuer in Providing relevant, underwriters, banks, and dealers. ::.~. _::i. ~: comprehensive financial information. Sound planning, 'reliable information .... ~..:~/..~ Bartle Wells Associates is known to and carefully coordinated promotional i'~ ...~'the underwriting profession as an efforts encourage favorable bond i~'~!!'I~!': independent financing Consulting firm, ratings and lower interest rates. /~.'.-?-;~;~'i owned entirely by its.employees. We "-~ A lower interest rate means saving~'i:~i~d,i, do not trade in securities. Because of to the issuing agency. For example, quality of our official ~ta. tements, each 1/10 of 1 percent interest rate and because we have no conflict of reduction results in a savings of over ::ii'~i?interest, we enjoy ii'high level of credi- $11,000 for a $1 million bond issue with ~ bility among underwriters and dealers. a 15-year term at 11 percent interest. As :":':i - A technical paper;:,YPreparation of the amount or term increases, the ' ?~'?i;i-?:~:- Official Statements, 'Prepared for the potential dollar savings are much '~??"?.:. Municipal Finance Officers Associa- greater. The financing consultant's services, tailored to the client's needs, can be highly cost-effective. :- Importance of the Official Statement One of the outstanding functions per- formed by Bartle Wells Associates is the production of substantive, understand- able official statements. An official statement must describe the bonds, the project being financed, and the finan- cial condition of the agency and its sur- rounding community, to indicate the quality of local financial management and the economic strength of the issuer. A thorough official statement enables prospective buyers to rely on a single document in making their judg- ment on the issue. We have complete in-house resources for providing up-to-date financial data--including a govern- mental research library for communi- ties in California, Oregon, and other western states, with a continuous flow of current statistical data from state, federal, and other agencies. Municipal issuers are responsible for providing full financial disclosure in tion, is available upon request. Diverse Bond -:-~:.'.:-:~..' Marketing Experience Bartle Wells Associates has extensive experience in the marketing of all types of securities for public agencies, inclUding: . ~.. · · General obligation bonds · Revenue bonds . - · Assessment bonds · Bancroft bonds (Oregon) · Joint powers authority lease-rental revenue bonds · Nonprofit corporation lease-rental revenue bonds · Notes and warrants · Tax allocation bonds Since its founding in 1964, Bartle Wells Associates has been a leader in the use of competitive public bidding procedures, and in establishing high standards for official statements. We were the first consultants to recom- mend competitive public sale for non- profit corporation lease-rental revenue bonds, now required by law in some states. Clients of Bartle Wells Associ- ates have competitively sold the largest · -.. r /--~. . ~-~BARTLE WELLS ASSOCIATES . ~- ~~ FINANCING INNOVATIONS Battle Wells Associates has extensive experience in the design and marketing of municipal bonds and in financing public works improve- ments. We are well-known for our ability to analyze governmental financial needs and develop innovative financing techniques to serve our clients. Some of our innovations are described below. o Bond Marketing. Communication - Upon founding the firm in 1964, we retained James R. Stockton as graphics consultant to redesign the entire format of official statement presentation. Each issue is separately designed to impress the reader with the quality of the product in the best advertising sense. We back that concept with thorough technical work so that the combination of presentation design and technical competence sell our clients' products. We have set industry standards for quality graphics and presentation. o General-Communication - We regularly employ Even Peters, a public relations specialist, to help provide better communication of our financing recommendations on the local level. The purpose here is to ensure that local agencies understand and use the most effective financing methods. In the thirteen years before Proposition 13, we never lost a California general obligation sewer bond election requiring a two-thirds majority. o o Maturity Schedule Design - To help our clients sell bonds at favor- able interest rates during the difficult bond markets of the early 1970's, we developed the "hogback" maturity schedule. Under this design, substantial bonds mature in years 7 through 12, which is productive for the underwriter' and results in lower total costs for the issuer. This design derives from the observation, that curves of constant dollar production are nearly parallel to the usual bond yield curve within that period, permitting the earlier amortization of long bonds, which have higher cost. o Interest Rate Constraints - Beginning in 1970, we developed bidding constraints to-reduce the present value of the interest costs to our clients without complicating the evaluation of competitive bids. In '1974, our use of nondescending-order coupons was studied and subsequently adopted as a reasonable standard by the Center for Capital Market Research at the University of Oregon. o New York Marketing Trip - We have developed a highly effective marketing tool for our west coast issuers. It consists of direct 15-minute presentations (by appointment) to between 25 and 60 New York bond analysts. We use 8~ x 11 chart handouts and other visual aids. These materials are expanded for presentations to the rating agencies and bond dealers. Our competent, effective presentation has earned us the respect and attention of many New York analysts, as demonstrated by heavier-than-usual East Coast interest on issues for which we have made New York trips. · . · FINANCING INNOVATIONS, continued . . ..7-~ o Revenue Bonds - Battle Wells Associates has developed a number of innovative techniques for revenue bond cash flow, to protect the interest of the bondholders while maintaining flexibility for the issuer. One technique is using the bond reserve fund to provide the deductible portion of casualty insurance on revenue and lease rental bonds. o Nonprofit Corporation Bonds - Bartle Wells Associates has been a leader in the design and marketing of nonprofit corporation bond issues in California since 1966. According to Donald Hodgman of O'Melveny & Myers, Battle Wells Associates was the first firm to market California nonprofit corporation bonds through competitive bidding at public sale. Ca~ornia law now requires competitive sale of such bonds to protect the public interest and better ensure lower financing costs. We are the first consultants to successfully design and market nonprofit bonds under a phased-bidding proce- dure and multi-purpose pro~ects involving several issues. Outside of the public building field, we marketed the largest issue of non- profit corporation leasehold mortgage bonds in the nation ($79.4 million) to finance a project.to deliver water to 'ten regional agencies using subleases. o Escalating Connection charges - We developed the use of escalating connection charges as a revenue source to provide sewer and water capacity for growth. Such charges have not discouraged develop- ment, and have since become widespread in the western states. We have successfully marketed revenue bonds paid substantially from such connection charges. o Advance Refunding- Competitive Sales - We developed the tech- nical approach to Competitive sale of advance-refunding issues and successfully marketed the first such issue in California. We also advised the Oregon Legislature and State Treasurer, and helped establish guidelines for approval of advance-refunding issues by the State Treasurer. '1 ill BARTLE WELLS ASSOCIATES PROFESSIONAL STAFF Battle Wells Associates is an organization of individual specialists, offering a unique mix of academic training, experience, and expertise in municipal finance. Edwin A. Wells has been a municipal financing consultant in public works financial planning and bonding methods for over 20 years. In years of full-time service as a financing consultant to public agencies, he is the West Coast's senior consultant. Widely recog- nized as an expert on water supply, water system valuation and acquisition, sewerage, and public building financing, he is known also as a principal innovator in the development of lease revenue financing techniques, including joint powers authority and non- profit corporation procedures. He has extensive background in bond marketing techniques, interagency contract negotiations, and evaluation of publicly financed projects. Prior to forming Battle Wells Associates, Ed was a general partner in an investment securities firm. He has an engineering background with advanced degrees in water supply, sanitary engineering, and engineering economics. Ed is a registered civil engineer in California, and served as Treasurer of the Town of Portola Valley for 12 years. Thomas E. Gaffney is the firm's president and managing consultant, and has over fourteen years of consulting experience. He has directed or participated in water and sewerage financing and insti- tutional programs, utility rate studies, and bond marketing-programs involving more than 150 separate agencies in California, Oregon, and Washington. He has considerable experience with interagency agreements for regional programs and developing financing plans and revenue programs for regional projects. He has managed sales of general obligation, revenue, lease revenue, assessment, and refunding bonds. Before joining Battle Wells Associates, Tom served as project engineer with a major engineering consulting firm where he per- formed economic analysis and feasibility studies on more than 20 large-scale engineering projects. He has a degree in civil engi- neering, a graduate degree in finance, and a business management certificate. He is a registered civil engineer in California. PROFESSIONAL STAFF, continued Lora J. Stovall has managed financing plans and institutional studies in a wide variety of areas, such as sewer and water, public buildings, flood control, solid waste, recreation, and port improvements. A financing consultant since 1969, she has directed the sale of general obligation, revenue, and assessment bonds, including nonprofit corporation and joint powers authority financing. She has degrees in journalism and business administration. William A. Sinsky is a civil engineering graduate of the University of Santa Clara, where he served as president of the American Society of Civil Engineers Student Chapter. 'He began working with Bartie Wells Associates in early 1979. He has participated in capital improvement programs in California, Oregon, and Washington. He has been involved as project consultant on over 15 financing and institutional plans and sewerage revenue programs, and has assisted in the management of several bond sales. Bill is an associate member of the A.S.C.E., and holds a current E.I.T. certificate. Edwin P. Ricci joined Battle Wells Associates after Serving with the U.S. Environmental Protection Agency in Washington, D.C., for five years as an attorney and senior policy analyst. He has extensive experience in developing federal regulatory programs and in working with state and local governments concerning their involvement with such programs. He has been directly responsible for the technical, economic, and legal analysis associated with numerous environmental regulations, and most recently has been involved in overseeing the planning and implementation of the national Hazardous Solid Waste Management Program under the Resource Conservation and Recovery Act. Before joining-the EPA he worked as a design engineer with two major corporations. He has a bachelor of science degree in mechanical engineering and the degree of ]uris Doctor, and is a member of the Pennsylvania Bar. Audrey Sherlock is controller of Bartle Wells Associates and is responsible for the supervision of contract terms with all clients. She has served as consultant on many bond sales, including school, water, sewer, port, and public building revenue, lease revenue, and general obligation bonds. She has over 10 years of experience in municipal finance based on a background in accounting, business law, and administration. _-- ~ BARTLE WELLS ASSOCIATES REFERENCES CALIFORNIA Otto H. W. Bluma, Director of Utilities, City of Thousand Oaks Arthur T. Cooke, Ir., Bank of America NT&SA, San Francisco Carlo Fowler, Orrick, Herrington, Rowley & Sutcliffe, San Francisco Donald R. Hodgman, O'Melveny & Myers, Los Angeles Robert G. Hutchison, City Manager, City of Roseville Charles A. Joseph, Manager, Novato Sanitary District, Novato John A. Lambie, Manager, Ventura Regional CSD, Ventura H. Ronald Lampson, Manager, Berrenda Mesa Water District, Bakersfield Charles A. Long, Chief of Redevelopment Services, City of Fairfield · Dennis E. MacLain, Manager, Municipal Water District of Orange Co., Santa Aha Richard A. Milbrodt, City Manager, City of South Lake Tahoe Herbert E. Nelson, City Manager, City of Red Bluff Melvin Shore, Port Director, Port of Sacramento William M. Siegel, County Executive, Santa Clara County Wallace Spinarski, Antelope ValleY-East Kern Water Agency, Lancaster Fritz Stradling, Stradling, Yocca, Carlson & Rauth, Ne~eport Beach John A..Tresch, Merrill, Lynch, Pierce, Fenner & Smith Inc., Los Angeles Everett Williams, Stone & Youngberg Investment Securities, San Francisco B. Gale Wilson, City l~ianager, City of Fairfield OREGON David J. Abraham, Utilities Director, Clackamas County Norman Bradley, U.S. National Bank of Oregon, Portland Robert J. Elfers, Director, State Bar Association (formerly Chief Administrative Officer, Lane County) Arthur R. Johnson, City Manager, City of Bend Fred Matthias, Director of Finance, City of Lake Oswego William K. McGuire, Finance Director, City of' Eugene Robert McWilliams, City Manager, City of Redmond ' Daniel O. Potter, City Manager, City of Wilsonville Howard Rankin, Rankin, McMurry, VavRosky & Doherty, Portland Richard D. Roberts, Ragen, Roberts, O'Scannlain, Robertson & Neil, Portland Vernon W. Smith, Asst. Superintendent, School District No. 42[, Eugene. James E. Todd, Director of Finance, City of Springfield William H. Young, Director, State Department of Environmental Quality ALASKA John A. Carlson, Mayor, Fairbanks North Star Borough NEW YORK Freda Ackerman, Moody's Investors Service, Inc. Robert Margolies, Standard & Poor's Corporation Alan N. Weeden, Weeden & Company, Inc. · , . ~' BARTLE WELLS ASSOCIATES -- ~x~ SERVICES OFFERED FINANCING CONSULTING Feasibility studies Alternative project financing analyses and capital programming Governmental research studies ''Long-range planning, programming, budgeting MultiPle-agency financing programs Computer-based financial management and forecasting Utility rate studies Public information, plan implementation Public acquisition of privately owned utilities Bond refunding program INSTITUTIONAL STUDIES Statutory authority of existing local agencies Statutory authority of alternative general law agencies Governmental consolidation alternatives Creation of special enabling legislation Local agency cooperation through joint powers agreements Nonprofit corporation techniques Lease-purchase programs MUNICIPAL BOND MARKETING Terms and conditions for sale Recommendation of covenants for revenue bonds Cooperation with legal counsel on formal bond proceedings Preparation and distribution of official statements Direct dealer contact Development of competitive bidding Assistance to rating agencies ' Bid analysis, bond award and delivery TYPES OF PRO~[ECTS Electrical power generation and distribution systems Flood control and water conservation Hospitals Industrial liquid waste management Parks and recreation Planned communities Ports and airports Public buildings Sewerage Solid waste resource recovery/management Transit and transportation Utility system acquisition Water supply and reclaimed water Battle Wells Associates Who We Are, What We Do Bartle Wells Associates was established in 1964 expressly to provide professional assistance to state and local govern- ments in financing capital improvements and selling bonds. The firm provides a strong combination of experience, inde- pendence, and versatility. Its consultants are thoroughly familiar with governmental organization, financing proce- dures, and federal and state aid programs. The firm is wholly owned and controlled by its employees. Because Bartle Wells Associates is not connected with any bond sales organizations Or underwriter, its recommenda- tions are independent of any desire to provide the ultimate financing. The firm's role is one of agency representative in offering bonds to the widest possible market. About half of its business volume derives from consulting without the prospect of any bond sale. Bartle Wells Associates has national recognition and leadership in professional municipal financing consulting. The firm and its principal consultants are well known by New York bond underwriters, banks, and rating agencies because of the quality of work and many years experience in direct market contacts in New York and other major markets for western clients. - - Bartle Wells Associates combines specialized public financ- ing expertise with engineering economics, general econom- ics, public administration, bond marketing techniques, and business journalism. Aside from providing general consulting services for public agencies, the firm's principal products are financing feasibility reports and official state- ments relating to bond sales. Bartle Wells Associates can serve all types of governmental~. units. The staff has worked with state agencies, cities, counties, and many different types of districts in California, Oregon, Washington, Nevada, and Alaska. The firm teams with engineering consultants to develop financing programs?: to support construction of public works projects of all types. Areas of experience include water, sewerage, water system~ acquisition, solid waste/resource recovery, flood control, irri-~ gation and drainage, parking facilities, ports, schools, streets and highways, mass transit, electric power, natural gas, parks, i: hospitals, redevelopment, and public buildings. Financing · has been accomplished by sale of general obligation, revenue,; and assessment bonds; by nonprofit corporation and public authority revenue bonds; and through state and federal loans and grants. The firm has been retained many times to create pay-as-you-go financing plans and to perform rate and revenue studies related to capital financing plans. il Whel L'..,., a c ,..,in rat I I en To Use a Financing Consultant? a consultant for complex financial problems, especially ~s¢ of a nonrecurring nature. The staffs of most agencies rarely meet these requirements. If they do, the agency v ':,e incurring excessively high overhead costs for main- an expensive staff on a standby basis, or using it on ~worthy assignments. On the other hand, anything less m ',he very highest-quality assistance on these major problems is dearly false economy. consulting organization must provide its clients superior ff capabilities more cheaply than they can provide it them- yes. A well-balanced consulting finn can provide uncom- high-grade talent in the correct proportions (normally ite an expensive product), yet incur only a moderate cost to mt for the work done. a consultant for: Maior policy questions for which the agency must rethink itt assumptions and convictions about financial objectives a~',3 means. Po!itical]v sensitive problems where the agency's interests and '-'"'lic perception seem to differ. Rates and charges ard. ital formation are characteristic of this type. Fact- -ting analytical evaluations where extensive re search and analysis are required into complex situations u sing specialized techniques and concepts. Bond sales. The agency must design bond issues so as to m~.et its capital needs and secure the lowest possible re:crest rate while remaining attractive to the capital marketplace. e o,..~tside consultant has the advantages of: Seeing the same type of problem in many situations. He h~:, a body of experience built up from frequent exposure t~, ~ituations which agency staff encounters only rarely. Fr,'edom from the assumptions and convictions every a,:,.ncv develops about itself and its services. The consul- ta ~: has a major advantage in objectivity because he is not a ?, :?.ternal career employee. M::~:'~taining a load factor in his use of time that the inter- n~:i -taft cannot maintain except on repetitive activities. I!'= refore the consultant is both more economical and b~ ::.:r equipped to handle the major non-recurring prob- k"::: ~r task. Why Select Bartle Wells Associates? A financing consultant shOuld be selected on the basis of qualifications and ability to serve. Good advice from a muni- cipal financing consultant can be invaluable to the client. The Bartle Wells organization has special qualifications. · We are experienced. We have managed the sale of over $1 billion of tax-exempt bonds; and completed 700 financial studies and bond ma.rketing assignments for more than 250 clients. · We are aggressive. The savings involved in obtaining the lowest possible interest rate can amount to thousands of dollars. We pursue that savings. We do it by digging a little deeper into all the financing possibilities, by present- ing the data to the underwriting market a little more persuasively, or by developing entirely new methods of raising needed funds. · We are small enough to provide personal service to every client. Our consultants can work with every project "in the shop" long enough to grasp its uniqueness and apply their experience on similar problems to its solution. · We are large enough to serve major projects. That means a staff large enough to handle all the specialized aspects of the study or the bond issue, and diversified enough to provide a complete range of services. · We have an exceptionally qualified, well-educated, and experienced staff. The principal consultants of Bartle Wells Associates have more than 60 years combined experience in all fields of municipal finance. · We are innovative. We were the first firm to sell nonprofit corporation bonds at competitive public sale, now re- quired in some states to reduce interest cost. We were first to use nonprofit corporation financing for staged, or "fast-track" construction--avoiding large increases in construction cost. We marketed the three largest nonprofit corporation iS~sues in public building finance and the largest nonprofit corporation issue to provide wholesale water to ten local agencies. · We do not deal in securities, and we do not underwrite, buy, or trade in any of the bonds our clients issue. Thus, we can be completely independent and unbiased in our approach to a bond sale. Bartle Wells Associates 1636 Bush Street San Francisco 94109 (415) 775-3113 Portland (503) 228-0608 Front Cover: Official statement cover graphics by book designer James Stockton have provided a quality market- ing image for over two hundred new bond issues. The impact of attractive graphics with creative research has established Bartle Wells Associates' consistent ability to represent each of our clients effectively in the financial corr~munity.