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Home My WebLink About6 Grays Crossing Bond issuance Agenda Item # (�o Public Utility District Memo To: Board of Directors From: Stephen Hollabaugh Date: May 27, 2005 Subject: Truckee Donner Public Utility District Community Facilities District No. 04-1, Series 2005(Grays Crossing) Why this matter is before the Board: We have been systematically moving toward the issuance of bonds, Series 2005, for the Community Facilities District (CFD) Gray's Crossing development. We are now at the point in the process where we need the Board to adopt a Resolution which authorizes legal and financing documents in connection with the sale and issuance of Bonds. History: East West Partners asked the District to consider forming a Community Facilities District to help finance infrastructure at the Grays Crossing development. On July 21, 2004 the Board passed assorted documents forming the Community Facilities District No. 04-1 (Grays Crossing) and authorizing various related actions. Resolutions passed were: Joint Community Facilities Agreements with the Town of Truckee and the Truckee Sanitation District, Acquisition and Disclosure Agreement, the Levy of a Special Tax and Establishing an Appropriations Limit, Incur Bonded Indebtedness, Calling a Special Election and Declaring the Results of a Special Election. Ordinance passed was: the Levy of a Special Tax Within the Community Facilities District. New information: We now have a series of items that are part of the legal and financing documents for Community Facilities District 04-1, Series 2005 (Grays Crossing). John Murphy and Greg Blonde of Stradling Yocca Carlson & Rauth prepared the Indenture and the Preliminary Official Statement. Jeff Stava of Nossman, Guthner, Knox & Elliott prepared the Bond Purchase Agreement and the Continuing Disclosure Agreement. The documents have been prepared by experts in the field. They have been used in the formation of other CFDs throughout the state, and have stood the test of time. The documents are attached for your review. t s F Y 1 5 Recommendation: Consideration of a Resolution of the Board of Directors of the Truckee Donner Public Utility District authorizing the sale and issuance of special tax bonds and approving documents relating thereto: 1. The First Supplemental Trust Indenture dated as of June 1, 2005 between Bank of New York Trust Company and the Truckee Donner Public Utility District Community Facilities District NO. 04-1, Series 2005. 2. The Continuing Disclosure Agreement dated as of May 1, 2005 between MuniFinancial and the Community Facilities District. 3. The Preliminary Official Statement relating to the Bonds. 4. The Bond Purchase Agreement between the Community Facilities District and UBS Financial Services Inc. s s } { b { f } 1 } 7 r - S' Resolution No. 2005 - XXX RESOLUTION OF THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT, ACTING AS THE LEGISLATIVE BODY OF TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 04-1 (GRAY'S CROSSING), AUTHORIZING THE SALE AND ISSUANCE OF SPECIAL TAX BONDS OF SAID COMMUNITY FACILITIES DISTRICT, APPROVING DOCUMENTS RELATING THERETO AND AUTHORIZING AND DIRECTING CERTAIN RELATED ACTIONS WHEREAS, the Board of Directors (hereinafter sometimes referred to as the "legislative body of the Community Facilities District" or the "Board"), of the Truckee Donner Public Utility District has heretofore undertaken proceedings and declared the necessity to issue bonds on behalf of Truckee Donner Public Utility District Community Facilities District No. 04-1 (Gray's Crossing) (the "Community Facilities District") pursuant to the terms and provisions of the Mello- Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5, of the Government Code of the State of California (the "Act"); and WHEREAS, based upon a resolution adopted by the legislative body of the Community Facilities District on June 16, 2004 and an election held on July 21, 2004 authorizing the issuance of bonds by the Community Facilities District, the Community Facilities District is now authorized to issue bonds in one or more series, pursuant to the Act, in an aggregate principal amount not to exceed $35,000,000; and WHEREAS, the Community Facilities District and The Bank of New York Trust Company, N.A., successor in interest to BNY Western Trust Company, (the "Trustee") have heretofore entered into the Trust Indenture dated as of March 1, 2004 (the "Original Indenture") and, pursuant thereto, the Community Facilities District has issued bonds in an aggregate principal amount of $15,375,000 designated as the Truckee Donner Public Utility District Community Facilities No. 04-1 (Gray's Crossing) Special Tax Bonds, Series 2004 (the "2004 Bonds"); and WHEREAS, the legislative body of the Community Facilities District intends to provide additional funds the financing of the cost of planning, designing, constructing, acquiring, modifying expanding, improving, furnishing, equipping or rehabilitating certain improvements, and ali appurtenances and appurtenant work in connection with the foregoing (collectively, the "Facilities") and the incidental expenses incurred and to be incurred in connection with financing the Facilities, including costs associated with the issuance of bonds and the establishment and replenishment of s 2 DOCSOC/]102394v3/22 92 5-001 6 a bond reserve fund, through the issuance of bonds in an aggregate principal amount not to exceed $19,625,000 designated as the "Truckee Donner Public Utility District Community Facilities District No. 04-1 (Gray's Crossing) Special Tax Bonds, Series 2005" (the "2005 Bonds" and, together with the 2004 Bonds, the "Bonds") that will constitute "Parity Bonds" within the meaning of the Original Indenture; and WHEREAS, the legislative body of the Community Facilities District has determined all requirements of the Act for the issuance of the 2005 Bonds as Parity Bonds under the Original Indenture have been satisfied; WHEREAS, in connection with the authorization, sale and issuance of the Bonds and the acquisition and construction of the facilities, forms of the following documents have been presented to this Board for approval: 1. the First Supplemental Trust Indenture, dated as of June 1, 2005, by and between the District and the Trustee (the "First Supplemental Indenture"); 2. the Continuing Disclosure Agreement, dated as of June 1, 2005 by and between MuniFinancial, as dissemination agent (the "Dissemination Agent"), and the Community Facilities District (the "Continuing Disclosure Agreement"); 3. the Preliminary Official Statement relating to the Bonds (the "Preliminary Official Statement"); and 4. the Bond Purchase Agreement relating to the Bonds (the "Bond Purchase Agreement") by and between the Community Facilities District and UBS Financial Services Inc. (the "Underwriter'); NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT, ACTING AS THE LEGISLATIVE BODY OF TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 04-1 (GRAY'S CROSSING), DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS: Section 1. The above recitals, and each of them, are true and correct. Section 2. The proposed forms of the First Supplemental Indenture and the Continuing Disclosure Agreement are hereby approved; and the President of the Board of Directors (the "President") and the District Clerk (the "Clerk") are hereby authorized and directed for and in the name and on behalf of the Community Facilities District to execute, acknowledge and deliver to the respective other parties, the First Supplemental Indenture and the Continuing Disclosure Agreement in substantially said forms, with such additions thereto, completions thereof and/or changes therein as the officers executing the same may approve as necessary or desirable (consistent with the provisions of this Resolution and with form of the Bond Purchase Agreement approved pursuant hereto), such approval to be conclusively evidenced by the execution and delivery thereof. Section 3. The issuance of the Bonds pursuant to the Original Indenture and the First ' Supplemental Indenture in an aggregate principal amount approved by the General Manager of the Truckee Donner Public Utility District (the "General Manager") as being necessary to fund the various funds and accounts created by the Indenture in the amounts specified in the Preliminary Official Statement (or as determined by the General Manager), and to pay the costs of issuing the Bonds and the other costs described in the Preliminary Official Statement, is hereby authorized, DOCSOC/I 102394v3/22925-0016 provided that the principal amount of the Bonds shall not exceed the lesser of: (a) $19,625,000 or (b)the remainder of (i) one-quarter of the value of the property within the Community Facilities District that will be subject to the Special Tax, as such value is estimated in an appraisal prepared for the Community Facilities District by Christopher T. Donaldson, MAI, CCIM (a copy of which is set forth in Appendix B to the Preliminary Official Statement) minus the principal amount of all other bonds outstanding, if any, that are secured by a special tax levied pursuant to the Act on property within the Community Facilities District or a special assessment levied on such property (as shown in the report of California Municipal Statistics, Inc. which appears as Table 2 in the Preliminary Official Statement). The Bonds shall mature on the dates and in the amounts, and bear interest at the rates, set forth in the Bond Purchase Agreement to be executed on behalf of the Community Facilities District in accordance with Section 8 hereof. Section 4. In connection with the issuance of the Bonds, the President and the Clerk are hereby authorized and directed for and in the name and on behalf of the Community Facilities District to execute, acknowledge and deliver to the respective other parties such additional agreements, as the officers executing the same may approve (including, but not limited to an Investment Agreement, as defined in the Original Indenture) as necessary or desirable to provide reductions in the yields of Bonds or additional debt service relief or cash flow savings or increased payments to the Community Facilities District, such approval to be conclusively evidenced by the execution and delivery thereof. Section 5. The form of the Bonds, as set forth in the form of the First Supplemental Indenture (as the Indenture may be modified pursuant to Section 2 hereof), is hereby approved; and the President and the Clerk are hereby authorized and directed to execute them by manual or facsimile signature in the name and on behalf of the Community Facilities District. Section 6. The proposed form of the Preliminary Official Statement is hereby approved with such changes thereto as may be approved by the General Manager in order to make such Preliminary Official Statement final as of its date, except for the omission of certain information, as permitted by Section 240.15c2-12(b)(1) of Title 17 of the Code of Federal Regulations (the "Rule"); and the distribution of the Preliminary Official Statement in connection with the sale of the Bonds, with such changes included, is hereby authorized. The General Manager is authorized and directed to execute and deliver a certificate relating to compliance with the Rule. The President and the General Manager are each authorized and directed, jointly and severally, to execute and deliver to the Underwritors a final Official Statement in substantially the form of the Preliminary Official Statement hereby approved with such changes as may be approved by the officer executing said document as necessary or desirable, such approval to be conclusively evidenced by the execution and delivery thereof. Section 7. In accordance with the provisions of Section 53360.4, the Board hereby finds and determines that a negotiated sale of the Bonds to the Underwritors in accordance with the terms of the Bond Purchase Agreement will result in a lower overall cost to the Community Facilities District than a sale conducted pursuant to Section 53360 of the Act. Section 8. The proposed form of the Bond Purchase Agreement and the sale of the Bonds pursuant thereto are hereby approved, provided that (a) the aggregate purchase price of the Bonds (exclusive of any original issue discount) shall not be less than ninety-eight and seventy hundredths percent (98.70%) of the original aggregate principal amount of the Bonds, (b) the average annual rate of interest on the Bonds shall not exceed six and one-half percent (6.5%), (c) the final maturity of the Bonds shall be not later than September 1, 2035 and (d) the maturity dates and purchase price of and interest rates applicable to the Bonds shall have been approved by a pricing committee consisting of the General Manager, the Assistant General Manager, and the 3 DOCSOC/1 102394v3/22 92 5-0 0 1 6 E Administrative Services Manager with the advice of Fieldman, Rolapp & Associates; and, subject to such approval, the President and the Clerk are hereby authorized and directed to evidence the Community Facilities District's acceptance of the offer made by said Bond Purchase Agreement by executing and delivering to the Underwritors said Bond Purchase Agreement in said form with such changes therein as the officers executing the same may approve as necessary or desirable, such approval to be conclusively evidenced by the execution and delivery thereof. Section 9. In the event the President is unavailable to execute and deliver any of the documents that the President is authorized and directed to execute and deliver pursuant to the terms of this Resolution, then any other member of this Board is hereby authorized and directed to do so. Any of the documents that the General Manager is authorized and directed to execute and deliver pursuant to the terms of this Resolution may be executed by any officer of the Truckee Donner Public Utility District designated to do so by the General Manager. Section 10. The President and the General Manager and other officers of the Truckee Donner Public Utility District are hereby authorized and directed, jointly and severally, to execute and sign any and all approvals, certificates, statements, requests, requisitions and orders of the Community Facilities District in connection with the issuance of the Bonds; and any action specifically authorized or directed by this Resolution to be undertaken by any of such officers may be undertaken by either of the others with the same force and effect as if it had been undertaken by the officer specifically authorized or directed to do so. Section 11. If any section, paragraph or provision of this Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any remaining provisions of this Resolution. Section 12. This Resolution shall take effect from and after its adoption. ADOPTED and APPROVED by the Board of Directors of the Truckee Donner Public Utility District on this 1" day of June, 2005 by the following vote: AYES: NOES: ABSENT: ABSTAIN: TRUCKEE DONNER PUBLIC UTILITY DISTRICT By: J. Ron Hemig, President of the Board of Directors ATTEST: Peter L. Holzmeister, District Clerk 4 DOCSOC/I 102394v3/22925-0016