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HomeMy WebLinkAboutAGENDA REPORT 2013 0306 CCSA REG ITEM 09B ITEM 9.13. city council Wr'a liinq MOORPARK CITY COUNCIL ACTION:QAU, ` z AGENDA REPORT � M TO: Honorable City Council FROM: Hugh R. Riley, Assistant City Manager DATE: February 25, 2013 (CC Meeting of (3/6/13) SUBJECT: Consider Proposed Bond Refinancing- CFD 2004-1- Moorpark Highlands (Pardee) BACKGROUND & DISCUSSION The City Council is being asked to consider authorizing the issuance of Special Tax (Mello Roos) Community Facilities District Bonds to refund the CFD 2004-1 -Moorpark Highlands (Pardee) outstanding Bonds. The Council will recall the City issued its $38,030,000 Community Facilities District No. 2004-1 (Moorpark Highlands) Special Tax Bonds, Series 2006, in July Of 2006 (the "2006 Bonds"). In September 2010, $8,395,000 of these bonds were redeemed to dispose of surplus funds that were originally available to purchase the 22-acre school site property. The result, of the redemption and reallocation of debt to the additional 133 lots created on the former school site reduced the assessment to the average property owner by approximately 37%. The current outstanding principal amount of the 2006 Bond Issue is $22,360,000, and the interest rate on the bonds with the longest maturity (2038) is 5.125%. Based on current interest rates, the City can refund (refinance) the 2006 Bonds with a new refunding bond issue, with an interest rate (based on yield) of approximately 4.45% for the same maturity date (the new bonds would not extend the original term date of 2038). The proposed refunding bond issue (the "2013 Bonds") would be issued in two series, Series A and Series B, with Series A based on a bond principal amount attributable to parcels owned by individual homeowners, and the Series B bonds based on the remaining parcels owned by Pardee Homes and Toll Brothers. We will obtain a lower interest rate for the principal amounts tied to the homeowners than the amounts tied to the developers. Therefore it is anticipated that the Series A Bonds would be rated by Standard & Poors, and that the Series B Bonds would be unrated as they may be less attractive to bond buyers. Based on an estimated annual savings amount of $213,492, the total gross debt service savings over the remaining 25 year term will be approximately $5.3 million. The net present value of the debt service savings is approximately $1 million, after accounting for funds on hand with the Trustee, and discounting for the time value of money. 4 Honorable City Council Regular Meeting of March 6, 2013 Page 2 The current average Special Tax amount paid by individual homeowners is $2,474 per year. Based on the estimated 13.4% reduction in annual bond debt service payments ($1,598,298 currently vs. proposed $1,384,806), the estimated average annual special tax for homeowners would be reduced to $2,142, a reduction of approximately $332 per year. That would save the average homeowner a total of approximately $8,300 over the remaining 25 year bond term. The savings represents a Net Present Value Savings (NPVS) of about 4.5%. The savings amounts have been estimated based on current market interest rates, and are subject to change. It is anticipated that the 2013 Bonds could be issued in April of this year, and that the estimated debt service savings for homeowners would be reflected in the property tax bills that are sent out this coming October for the 2013-14 fiscal year. With interest rates beginning to increase slightly, if we do not proceed with the refinancing this spring and the NPVS falls below 3% the refinancing would not be considered feasible. Issuance resolutions and related documents will be presented to the City Council for approval on March 20. FISCAL IMPACT There are no costs or obligations to the City of Moorpark. All fees are paid from bond proceeds. STAFF RECOMMENDATION Authorize the Refunding Bonds Series 2013 A and B and authorize the City Manager to accept and sign fee proposals from Financial Advisor, Underwriter, Bond Counsel, Disclosure Counsel, Escrow Agent, Paying Agent and Registrar and all subsequent fee proposals associated with the new Bonds subject to final language approval by the City Manager and the City Attorney. ATTACHMENTS: Fee Proposal- Bank of New York 5 BNY MELLON 6, City of Moorpark CFD No. 2004-1, Special Tax Refunding Bonds, Series 2013 Trustee, Paying Agent, Registrar and Escrow Agent Fee Schedule February 15, 2013 Jose Matamoros Vice President The Bank of New York Mellon Trust Company,N.A. 400 S. Hope Street,Suite 400 Los Angeles,CA 90071 Phone:213-630-6457 ( Combined fee Schedule for Services of: Mobile:562-533-3648 Jose.matamoros(a)BNYMellon.com • Trustee • Paying Agent and Registrar * Escrow Agent i Safest tank in the J.S. World's 50 Safest Barks j 2012 3 G'o i F' i B�'r' ME t I.0N I 6 BNY MELLON Fee Schedule Upon appointment of The Bank of New York Mellon Trust Company, N.A. ("BNYM Trust Company") as Trustee, Paying Agent, Registrar and Escrow Agent, the City of Moorpark shall be responsible for the payment of the fees, expenses and charges as set forth in this Fee Schedule. General Fees Acceptance Fee This one me charge is payable at the me of the closing and includes the review and execu on of the Indentures and all documents submi ed in support thereof; coordina on of all closing logis cs with the Issuer, A orneys, Note-holders and other related par es and the establishment of the debt issues and noteholder records on our recordkeeping system. Annual Administra on Fee 11 An annual fee is applicable and covers the du es and responsibili es related to account administra on and bondholder services, which may include maintenance of accounts on various systems, collec on and payment of principal and interest to bondholders, the prepara on and distribu on of any redemp on no ces and the monitoring of issuer compliance. This fee is payable in advance for the year and shall not be prorated. One Agent 11 This charge is payable at the me of the closing and includes the review and execu on of the Agreement and all documents submi ed in support thereof, acceptance of the trust, establishment of procedures and controls, set-up of trust accounts and the du es and responsibili es related to account administra on for the term of the escrow. Should the term of the agreement last longer than one year we reserve the right to bill addi onal fees at a prorated amount. Investment Compensa on With respect to investments in money market mutual funds for which The Bank of New York Mellon provides shareholder services, BNYM Trust Company (or its a hates) may receive fees from the mutual funds (or their a hates)for shareholder services as set forth in the Authoriza on and Direc on to BNYM Trust Company to Invest Cash Balances in Money Market Mutual Funds. All investment maintenance fees will be charged monthly. Investments BNYM Trust Company will charge a $35 transac on fee for the purchase, sale, or maturity of commercial paper and U.S.treasuries and agencies or draws upon LAIF,CAMP,County Pools and any investment contracts or agreements. Requisi on/Disbursement Fee-Check or Wire/per transac on A fee of$35 per disbursement will be assessed for each cash disbursement or requisi on. PRIVILEGED AND CONFIDENTIAL The information in this document,and any attachment herewith,is confidential and for use by the addressee only. Page 2 of 4 BNY MELLON Investment Agreement,or Repurchase/Forward Purchase Agreement I App ica e BNYM Trust Company will charge a one- me fee in the amount of $500 for review and acceptance of any investment agreement or repurchase agreement. Counsel Fees (if any) associated with the review and acceptance of the above will be billed at cost not to exceed $500. BNYM Trust Company will charge a $35 transac on fee for principal adjustments to the Investment Agreement. Counsel Fees 00 plus expenses A fee covering the reasonable fees and expenses of Counsel for its services, including review of governing documents, communica on with members of the closing party (including representa ves of the issuer, investment banker(s), a orney(s) and BNYM Trust Company), a endance at mee ngs and the closing, and such other services as BNYM Trust Company may deem necessary. The Counsel fee will be the actual amount of the reasonable fees and expenses charged by Counsel and is payable at closing. Should closing not occur, you shall s II be responsible for payment of reasonable Counsel fees and expenses. Miscellaneous Fees The fees for performing extraordinary or other services not contemplated at the me of the execu on of the transac on or not speci cally covered elsewhere in this schedule will be commensurate with the service to be provided and will be charged in BNYM Trust Company's sole discre on. These extraordinary services may include, but are not limited to, supplemental agreements, consent opera ons, unusual releases, tenders or sinking fund redemp ons, the prepara on of special or interim reports or custody of collateral. Counsel, accountants, special agents and others will be charged at the actual amount of reasonable fees and expenses billed. FDIC or other governmental charges will be passed along to you as incurred. Out Pocket Addi onal out-of-pocket expenses may include, but are not limited to, telephone; facsimile; courier; copying; postage; supplies; statutory ling charges, including UCC amendments, con nua ons, and termina on fees; and expenses of BNYM Trust Company's representa ve(s) and Counsel for a ending special mee ngs. Fees and expenses of BNYM Trust Company's representatives and Counsel will be charged at the actual amount of fees and expenses charged and all other expenses will be charged at cost or in an amount equal to 6%of all expenses billed for the year, in BNYM Trust Company's discre on, and BNYM Trust Company may charge certain expenses at cost and others on a percentage basis. Default In the event that a default occurs and is not cured within the appropriate me period required by the Indenture, BNYM Trust Company shall be paid a Default Administra on Fee calculated in accordance with BNYM Trust Company's hourly rate in a ect at the me of the default and as may be modi ed by BNYM Trust Company in its sole discre on from me to me therea er, plus all expenses incurred by BNYM Trust Company, which expenses will include the fees and expenses of Counsel. In addi on, if BNYM Trust Company is required to advance any payments, BNYM Trust Company shall be en tled to charge interest on such advances at BNYM Trust Company's(or one of its affiliate's)prime rate in effect on the date of the advance. 8 PRIVILEGED AND CONFIDENTIAL The information in this document,and any attachment herewith,is confidential and for use by the addressee only. Page 3 of 4 Al" BNY MELLON Terms and Disclosures TERMS OF PROPOSAL Final acceptance of the appointment as Trustee, Paying Agent, Registrar and Escrow Agent under the Indenture is subject to approval of authorized o cers of BNYM Trust Company and full review and execu on of all documenta on related hereto. Please note that if this transac on does not close,you will be responsible for paying any expenses incurred, including reasonable Counsel fees. We reserve the right to terminate this o er if we do not enter into nal wri en documents within three months from the date this document is rst transmi ed to you. Fees may be subject to adjustment during the life of the engagement. MISCELLANEOUS The terms of this Fee Schedule shall govern the ma ers set forth herein and shall not be superseded or modi ed by the terms of the Indenture. This Fee Schedule shall be governed by the laws of the State of California without reference to laws governing con icts. BNYM Trust Company and the undersigned agree to jurisdic on of the federal and state courts located.in the State of California. The City of Moorpark shall be responsible for ling any applicable informa on returns with the U.S. Department of Treasury, Internal Revenue Service in connec on with payments made by BNYM Trust Company to vendors who have not performed services for BNYM Trust Company's bene t under the various note issuances or other undertakings contemplated by this fee agreement. CUSTOMER NOTICE REQUIRED BY THE USA PATRIOT ACT To help the US government ght the funding of terrorism and money laundering ac vi es, US Federal law requires all nancial ins to ons to obtain, verify, and record informa on that iden es each person (whether an individual or organiza on)for which a rela onship is established. What this means to you: When you establish a rela onship with BNYM Trust Company, we will ask you to provide certain information (and documents) that will help us to identify you. We will ask for your organization's name, physical address,tax iden ca on or other government registra on number and other informa on that will help us to iden fy you. We may also ask for a Cer cate of Incorpora on or similar document or other per nent iden fying documenta on for your type of organiza on. We thank you for your assistance. For: The Bank of New York Mellon Trust_ Accepted By: Cc rr)pany, NA Signature: \ Date: February 153 2013 Name: lase Matamoros Title: "Dice President 9 PRIVILEGED AND CONFIDENTIAL The information in this document,and any attachment herewith, is confidential and for use by the addressee only. o , „ o n r n