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HomeMy WebLinkAboutReso 72-2022 (22-349)City of South San Francisco P.O. Box 711 (City Hall, 400 Grand Avenue) IgoSouth San Francisco, CA City Council Resolution: RES 72-2022 File Number: 22-349 Enactment Number: RES 72-2022 RESOLUTION OF THE CITY OF SOUTH SAN FRANCISCO AUTHORIZING THE EXECUTION AND DELIVERY OF A SECOND AMENDMENT TO LEASE AGREEMENT, SECOND SUPPLEMENTAL INDENTURE, CONTINUING DISCLOSURE AGREEMENT AND BOND PURCHASE AGREEMENT IN CONNECTION WITH THE ISSUANCE OF THE CITY OF SOUTH SAN FRANCISCO PUBLIC FACILITIES FINANCING AUTHORITY (MULTIPLE CAPITAL PROJECTS AT ORANGE MEMORIAL PARK) LEASE REVENUE BONDS, SERIES 2022A, APPROVING THE ISSUANCE OF SUCH BONDS IN AN AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $75,000,000, AUTHORIZING THE DISTRIBUTION OF AN OFFICIAL STATEMENT IN CONNECTION WITH THE OFFERING AND SALE OF SUCH BONDS AND AUTHORIZING THE EXECUTION AND DELIVERY OF NECESSARY DOCUMENTS AND CERTIFICATES AND RELATED ACTIONS WHEREAS, the City of South San Francisco, California (the "City") is a municipal corporation and general law city duly organized and existing under and pursuant to the Constitution and laws of the State of California (the "State"); and WHEREAS, in order to finance certain public facilities and improvements of the City, the City of South San Francisco Public Facilities Financing Authority (the "Authority") has issued various series of bonds (the "Prior Bonds") pursuant to an Indenture, dated as of March 1, 2020, as supplemented by a First Supplemental Indenture dated as of June 1, 2021 (together, the "Original Indenture"), each by and among the City, the Authority and The Bank of New York Mellon Trust Company, N.A. (the "Trustee"); and WHEREAS, in connection with the issuance of the Prior Bonds, the Authority and the City entered into a Ground Lease dated as of March 1, 2020, as amended and supplemented by the First Amendment to Ground Lease dated as of June 1, 2021 (together, the "Ground Lease"), pursuant to which the City leased to the Authority certain real property and the improvements thereon (the "Leased Assets"), and a Lease Agreement, dated as of March 1, 2020, as amended and supplemented by the First Amendment to Lease Agreement dated as of June 1, 2021 (together, the "Original Lease Agreement"), pursuant to which the Authority subleased the Leased Assets to the City; and City of South San Francisco Page 1 File Number. 22-349 Enactment Number. RES 72-2022 WHEREAS, the City desires to issue a series of Additional Bonds (as defined in the Original Indenture) to finance the costs of the acquisition, construction and/or installation of additional City facilities, consisting of new multi -use sports fields, a new aquatic center and certain other park facilities located at Orange Memorial Park and related improvements, facilities and equipment (the "Project"); and WHEREAS, the Authority and the City have determined that it would be in the best interests of the City and residents of the City to authorize the preparation, sale and delivery of the "City of South San Francisco Public Facilities Financing Authority (Multiple Capital Projects at Orange Memorial Park) Lease Revenue Bonds, Series 2022A" (the "Bonds") for the purpose of financing the Project; and WHEREAS, in order to facilitate the issuance of the Bonds, the City and the Authority desire to enter into a Second Amendment to Lease Agreement (the "Second Amendment to Lease Agreement"), which amends the Original Lease Agreement to increase the Base Rental Payments (as defined in the Original Lease Agreement) to be paid by the City thereunder to amounts sufficient to repay the Prior Bonds and the Bonds; and WHEREAS, pursuant to the Original Lease Agreement as amended by the Second Amendment to Lease Agreement, the City will lease the Leased Assets from the Authority, and pay certain Base Rental Payments, which are pledged to the owners of the Prior Bonds and the Bonds by the Authority pursuant to the Original Indenture, as supplemented by the Second Supplemental Indenture (the "Second Supplemental Indenture") to be entered into by the City, the Authority and the Trustee in connection with the issuance of the Bonds; and WHEREAS, the Bonds will be issued pursuant to the Marks -Roos Local Bond Pooling Act of 1985, commencing with Section 6584 of the California Government Code (the "Act"); and WHEREAS, the City and the Authority desire to provide for the negotiated sale of the Bonds; and WHEREAS, the City and the Authority have selected UBS Financial Services Inc. (the "Underwriter") to serve as the underwriter of the Bonds and, in connection therewith, to purchase the Bonds from the Authority pursuant to a Bond Purchase Agreement (the "Bond Purchase Agreement"); and WHEREAS, Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended ("Rule 15c2-12"), requires that, in order to be able to purchase or sell the Bonds, the Underwriter thereof must have reasonably determined that the City has undertaken in a written agreement or contract for the benefit of the holders of the Bonds to provide disclosure of certain financial information and certain events on an ongoing basis; and WHEREAS, in order to cause such requirement to be satisfied, the City desires to enter into a Continuing Disclosure Agreement (the "Continuing Disclosure Agreement") with a dissemination agent; and City of South San Francisco Page 2 File Number. 22-349 Enactment Number: RES 72-2022 WHEREAS, a form of the Preliminary Official Statement with respect to the Bonds (the "Preliminary Official Statement") has been prepared; and WHEREAS, the City is a member of the Authority and the Project is located within the boundaries of the City; and WHEREAS, the City has prior to the consideration of this resolution held a public hearing on the financing of the Project with the proceeds of the issuance of the Bonds in accordance with Section 6586.5 of the Act, which hearing was held on May 11, 2022; and WHEREAS, notice of such hearing was published once in The Examiner, a newspaper of general circulation in the City, at least five days prior to the hearing (in accordance with Section 6586.5 of the Act); and WHEREAS, the City Council has been presented with the form of each document referred to herein to be executed and delivered in connection with the financing contemplated hereby, and the City Council desires to authorize and direct the execution of such documents and the consummation of such financing; and WHEREAS, all acts, conditions and things required by the laws of the State of California to exist, to have happened and to have been performed precedent to and in connection with the consummation of such financing authorized hereby do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the City is now duly authorized and empowered, pursuant to each and every requirement of law, to consummate such financing for the purpose, in the manner and upon the terms herein provided. NOW, THEREFORE, the City of South San Francisco, does hereby resolve as follows: 1. Each of the above recitals is true and correct and the City Council so finds. Following a duly noticed and conducted public hearing, the City Council hereby finds and determines that there are significant public benefits to the citizens of the City through the use of the Act to assist the City with respect to the subject matter hereof through the approval of the issuance of the Bonds and otherwise hereunder within the meaning of Section 6586(a) -(d), inclusive, of the Act, in that the issuance of the Bonds and related transactions will result in more efficient delivery of local agency services to residential and commercial development. 2. The form of the Second Amendment to Lease Agreement, on file with the City Clerk, is hereby approved, and the Mayor of the City, or such other member of the City Council as the Mayor may designate, the City Manager, the Assistant City Manager, and the Director of Finance (or any interim or acting Director of Finance), and any designee thereof (the "Authorized Officers"), are each hereby authorized and directed, for and in the name and on behalf of the City, to execute and deliver the Second Amendment to Lease Agreement in substantially said form, with such changes, insertions and omissions therein as the Authorized Officer executing the same may require or approve (including, without limitation, the description of the Leased Assets to be leased thereunder), such approval to be conclusively evidenced by the execution and delivery thereof. City of South San Francisco Page 3 File Number: 22-349 Enactment Number. RES 72-2022 3. The form of the Second Supplemental Indenture, on file with the City Clerk, is hereby approved, and the Authorized Officers are each hereby authorized and directed, for and in the name and on behalf of the City, to execute and deliver the Second Supplemental Indenture in substantially said form, with such changes, insertions and omissions therein as the Authorized Officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof; provided, however, that the aggregate principal amount of the Bonds shall not exceed $75,000,000, the final maturity date of the Bonds shall be no later than June 1, 2046 and the true interest cost applicable to the Bonds shall not exceed 5.00% per annum, and, provided, further, that such changes, insertions and omissions shall be consistent with the terms of the Bonds established at negotiated sale pursuant to the Bond Purchase Agreement. 4. The Bond Purchase Agreement, on file with the City Clerk, is hereby approved and the Authorized Officers are, and each of them is, hereby authorized and directed, for and in the name of the City, to execute and deliver the acceptance thereof set forth in the Bond Purchase Agreement, with such changes, insertions and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Bond Purchase Agreement by such Authorized Officer; provided, however, that the aggregate underwriter's discount shall not be in excess of 0.30% of the aggregate principal amount of the Bonds (not including any original issue discount or premium). 5. The issuance of not to exceed $75,000,000 aggregate principal amount of the Bonds, in the principal amounts, bearing interest at the rates and maturing on the dates as specified in the Second Supplemental Indenture as finally executed, is hereby approved. 6. The form of the Preliminary Official Statement, on file with the City Clerk, with such changes, insertions and omissions therein as may be approved by an Authorized Officer, is hereby approved, and the use and distribution of the Preliminary Official Statement in connection with the offering and sale of the Bonds is hereby authorized and approved. The Authorized Officers are each hereby authorized to certify on behalf of the City that the Preliminary Official Statement is deemed final as of its date, within the meaning of Rule 15c2-12 (except for the omission of certain final pricing, rating and related information as permitted by Rule 15c2-12). The Authorized Officers are each hereby authorized and directed to furnish, or cause to be furnished, to prospective investors for the Bonds a reasonable number of copies of the Preliminary Official Statement. 7. The preparation and delivery of an Official Statement, and its use and distribution in connection with the offering and sale of the Bonds, is hereby authorized and approved. The Official Statement shall be in substantially the form of the Preliminary Official Statement with such changes, insertions and omissions as may be approved by an Authorized Officer, such approval to be conclusively evidenced by the execution and delivery thereof. The Authorized Officers are each hereby authorized and directed, for and in the name of and on behalf of the City, to execute the final Official Statement and any amendment or supplement thereto for and in the name and on behalf of the City. City of South San Francisco Page 4 File Number: 22-349 Enactment Number: RES 72-2022 8. The form of Continuing Disclosure Agreement, on file with the City Clerk, is hereby approved, and the Authorized Officers are each hereby authorized and directed, for and in the name and on behalf of the City, to enter into the Continuing Disclosure Agreement with Willdan Financial Services, as dissemination agent, or another third party, as selected by an Authorized Officer, in substantially said form, with such changes, insertions and omissions therein as the Authorized Officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. 9. The officers, employees and agents of the City are hereby authorized and directed, jointly and severally, to do any and all things which they may deem necessary or advisable in order to consummate the transactions herein authorized and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution, including, but not limited to, adding property to, substituting property for or removing property from the Leased Assets and making such further amendments to the Ground Lease, the Original Lease Agreement and the Original Indenture as may be necessary to facilitate the issuance of the Bonds in accordance with the terms of such agreements and paying for fees and other costs of issuance of the Bonds as agreed to by the City and the respective parties thereto. All actions heretofore taken by the officers, employees and agents of the City with respect to the transactions set forth above are hereby approved, confirmed and ratified. 10. In accordance with Government Code Section 5852.1, there has been presented to this City Council in the Staff Report accompanying this Resolution certain good faith estimates provided to the City by its municipal advisor with respect to the Bonds. The City Council hereby finds that the requirements of Section 5852.1 have been satisfied. 11. This resolution shall take effect immediately upon its passage. At a meeting of the City Council on 5/11/2022, a motion was made by Vice Mayor Nicolas, seconded by Councilmember Addiego, that this Resolution be approved. The motion passed. Yes: 5 Mayor Nagales, Vice Mayor Nicolas, Councilmember Coleman, Councilmember Flores, and Councilmember Addiego Attest by U 4 /4 dwL Pisa Govea Acosta, City Clerk City of South San Francisco Page 5