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HomeMy WebLinkAboutAGENDA REPORT 2017 1018 CCSA REG ITEM 10F ITEM 10.F. MOORPARK CITY COUNCILcotincvi AGENDA REPORT _ TO: Honorable City Council FROM: Ron Ahlers, Finance Director ' DATE: October 11,2017 (City Council Meeting of October 18, 2017) SUBJECT: Consider Authorizing Deposit and Reimbursement Agreement with Pacific Communities Builder, Inc. for the Formation of Community Facilities District 2018-1 (CFD 2018-1) SUMMARY The Deposit and Reimbursement Agreement (Agreement) with Pacific Communities Builder, Inc. enables the City to begin the process of forming a Community Facilities District (CFD). Specifically, that the City initiate and conduct proceedings for establishment of a community facilities district, pursuant to the Community Facilities Act of 1982 (the "Act") to be known as "City of Moorpark Community Facilities District No. 2018-1)" (the "CFD No. 2018-1"), The Agreement requires all the costs of the formation process to be paid by Pacific Communities Builder, Inc. BACKGROUND On October 4, 2017, the City Council adopted Ordinance 453 which approved the residential planned developments RPD-9U and RPD-20U on application of Pacific Communities Builder, Inc. City Council Ordinance 454 approved the development agreement between the City and Pacific Communities Builder, Inc. Sections 6.21 and 7.3 of the Development Agreement stipulate that a deposit and reimbursement agreement for the formation of a CFD will fund all city costs for the formation. The attached Agreement is for the initial deposit amount of $50,000 by Pacific Communities Builder, Inc. The City will utilize outside consultants and legal counsel for the formation process of the CFD. FISCAL IMPACT None. 87 Honorable City Council October 18, 2017 Page 2 STAFF RECOMMENDATION Authorize the Mayor to execute the Deposit and Reimbursement Agreement with Pacific Communities Builder, Inc. subject to final language approval by the City Manager and City Attorney. Attachments: Deposit and Reimbursement Agreement 88 DEPOSIT AND REIMBURSEMENT AGREEMENT City of Moorpark Community Facilities District No. 2018-1 THIS DEPOSIT AND REIMBURSEMENT AGREEMENT (this "Deposit Agreement"), dated as of , 2017, is by and between the City of Moorpark, a public body, corporate and politic (the "City") and Pacific Communities Builder, Inc. (the "Developer"). RECITALS WHEREAS, the Developer has requested that the City initiate and conduct proceedings for establishment of a community facilities district, pursuant to the Community Facilities Act of 1982 (the "Act") to be known as "City of Moorpark Community Facilities District No. 2018-1)" (the "CFD No. 2018-1"), the proposed boundaries of which are described in Exhibit A attached hereto; and WHEREAS, if CFD No. 2018-1 is formed, a prescribed portion of the property within the boundary shown on Exhibit A attached hereto (the "Taxable Property") will be subject to a lien which will secure payment of a special tax obligation to be imposed in accordance with a rate and method of apportionment of the special tax to be established and approved as a part of the proceedings to form CFD No. 2018-1 pursuant to the Act; and WHEREAS, the Developer has further requested the City to provide for issuance and sale of special tax bonds of the City on behalf of CFD No. 2018-1 (the "Bonds") pursuant to the Act to finance the cost and expense of acquiring, constructing and/or installing certain public facilities and/or fees used for such public facilities (the "Facilities"), which Bonds will be secured by the special tax obligation recorded as a lien against the Taxable Property; and WHEREAS, Developer is the current owner of the real property within the proposed CFD No. 2018-1; and WHEREAS, in accordance with City Ordinance 454, Development Agreement No. 2016-01, the Developer is required to compensate the City for all costs reasonably incurred in the formation of CFD No. 2018-1 and issuance of special tax bonds for CFD No. 2018-1; and WHEREAS, Section 53314.9 of the Act provides that, at any time either before or after the formation of a community facilities district, the legislative body may accept advances of funds from any source, including, but not limited to, private persons or private entities and may provide, by resolution, for the use of those funds for any authorized purpose, including, but not limited to, paying any cost incurred by the local agency in creating a community facilities district (including the issuance of bonds thereby); and WHEREAS, Section 53314.9 of the Act further provides that the legislative body may enter into an agreement, by resolution, with the person or entity advancing the funds, to repay all -1- 89 12853-0001\2122615v1.doc or a portion of the funds advanced, as determined by the legislative body, with or without interest under all of the following conditions: (a) the proposal to repay the funds is included in both the resolution of intention to establish a community facilities district adopted pursuant to Section 53521 of the Act and in the resolution of formation to establish the community facilities district pursuant to Section 53325.1 of the Act, (b) any proposed special tax is approved by the qualified electors of the community facilities district pursuant to the Act, and (c) any agreement shall specify that if the qualified electors of the community facilities district do not approve the proposed special tax, the local agency shall return any funds which have not been committed for any authorized purpose by the time of the election to the person or entity advancing the funds; and WHEREAS, the City and the Developer desire to enter into this Deposit Agreement in accordance with Development Agreement No. 2016-01 and Section 53314.9 of the Act in order to provide for the advancement of funds by the Developer to be used to pay costs incurred in connection with the formation of CFD No. 2018-1 and issuance of the Bonds, and to provide for the reimbursement to the Developer of such funds advanced, without interest, from the proceeds of the Bonds; NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows: Section 1. Recitals. Each of the above recitals is incorporated herein and is true and correct. Section 2. The Deposits and Application Thereof. (a) The Developer has previously deposited or will, concurrently with execution hereof deposit, with the City the amount of$50,000.00 (the "Initial Deposit"). The City, by its execution hereof, acknowledges receipt of, and accepts, the Initial Deposit. (b) The Initial Deposit, together with any subsequent deposit required to be made by the Developer pursuant to the terms hereof(collectively, the "Deposits"), are to be used to pay for any costs incurred for any authorized purpose in connection with the formation of CFD No. 2018-1 and the issuance of the Bonds (other than costs, fees and expenses to be paid directly out of the proceeds of the Bonds), including, without limitation, (i)the fees and expenses of any consultants to the City engaged in connection with the formation of CFD No. 2018-1 and the issuance of the Bonds, including an engineer, special tax consultant, financial advisor, bond counsel, disclosure counsel and any other consultant reasonably deemed necessary or advisable by the City, (ii) the costs of appraisals, market absorption and/or feasibility studies and other reports reasonably deemed necessary or advisable by the City in connection with the formation of CFD No. 2018-1 and issuance of the Bonds, (iii) the costs of publication of notices, preparation and mailing of ballots and other costs related to any hearing, election or other action or proceeding undertaken in connection with the formation of CFD No. 2018-1 and issuance of the Bonds, (iv) reasonable charges for City staff time incurred in connection with the formation of CFD No. 2018-1 and the issuance of the Bonds by CFD No. 2018-1, including a reasonable allocation of City overhead expense related thereto, and (v) any and all other actual costs and expenses incurred by the City in connection with the formation of CFD No. 2018-1 and the -2- 9 0 12853-0001\2122615v1 doc issuance of the Bonds (collectively, the "Initial Costs"). The City may draw upon the Deposits from time to time to pay the Initial Costs. (c) If, at any time, the unexpended and unencumbered balance of the Deposits is less than $5,000, the City may request, in writing, that the Developer make an additional deposit in an amount estimated to be sufficient, together with any such unexpended and unencumbered balance, to pay for all Initial Costs. The Developer shall make such additional deposit with the City within two weeks of the receipt by the Developer of the City's written request therefor by means reasonably acceptable to City. If the Developer fails to make any such additional deposit within such two week period, the City may cease all work related to the formation of CFD No. 2018-1 and/or the issuance of the Bonds. (d) The Deposits may be commingled with other funds of the City for purposes of investment and safekeeping, but the City shall at all times maintain accurate and detailed records as to the expenditure of the Deposits. (e) The City shall provide the Developer with a written monthly summary of expenditures made from the Deposits, and the unexpended balance thereof, as soon as is reasonably possible, but in no event more than thirty (30) business days of receipt by the City of a written request therefor submitted by the Developer. The cost of providing any such summary shall be charged to the Deposits. Section 3. Return of Deposits; Reimbursement. (a) As provided in Section 53314.9 of the Act, the approval by the qualified electors of CFD No. 2018-1 of the proposed special tax to be levied therein is a condition to the repayment to the Developer of the funds advanced by the Developer pursuant hereto. Therefore, if the qualified electors of CFD No. 2018-1 do not approve the proposed special tax to be levied thereon, the City shall have no obligation to repay the Developer any portion of the Deposits expended or encumbered to pay Initial Costs. In accordance with Section 53314.9 of the Act, if the qualified electors of CFD No. 2018-1 do not approve the proposed special tax to be levied therein, the City shall return to the Developer any portion of the Deposits which have not been expended or encumbered to pay Initial Costs by the time of the election on said proposed special tax. Such returned funds shall be without interest and shall be returned as soon as is reasonably possible, but in no event more than thirty (30) business days of the failure of the proposed special tax to be approved by the qualified electors of CFD No, 2018-1. (b) If proceedings for the issuance of the Bonds are terminated, the City shall, as soon as is reasonably possible, but in no event more than thirty (30) business days after official action by the City or CFD No. 2018-1 to terminate said proceedings, return the then unexpended and unencumbered portion of the Deposits to the Developer, without interest. (c) If the Bonds are issued by CFD No. 2018-1, the City shall reimburse the • Developer, without interest, for the portion of the Deposits that has been expended or encumbered, said reimbursement to be made as soon as is reasonably possible, but in no event more than thirty (30) business days after the issuance of such Bonds, solely from the proceeds of such Bonds and only to the extent otherwise permitted under the Act. The City shall, as soon as -3- 91 12853-000112122615vI.doc is reasonably possible, but in no event more than thirty (30) business days after the issuance of such Bonds, return the then unexpended and unencumbered portion of the Deposits to the Developer, without interest. Section 4. Abandonment of Proceedings. The Developer acknowledges and agrees that formation of CFD No. 2018-1 and the issuance of the Bonds shall be in the sole discretion of the City. No provision of this Deposit Agreement shall be construed as an agreement, promise or warranty of the City to form CFD No. 2018-1 or issue the Bonds. Section 5. Deposit Agreement Not Debt or Liability of City. As provided in Section 53314.9(b) of the Act, this Deposit Agreement does not constitute a debt or liability of the City, but shall constitute a debt and liability of CFD No. 2018-1 upon its formation. The City shall not be obligated to advance any of its own funds to pay Initial Costs or any other costs incurred in connection with the issuance of the Bonds. No member of the City Council of the City and no officer, employee or agent of the City shall to any extent be personally liable hereunder. Section 6. Notices. Any notices, statement, consent, authorization, offer, designation, requests, demands, documents, approvals, disapprovals or other communication given or sent under this Deposit Agreement from one party to another (collectively, "Notices") may be personally delivered, sent via overnight courier, transmitted by facsimile (FAX) or email or other electronic transmission, or deposit with the United States Postal Service for mailing, postage prepaid, to the address of the other party as stated in this Section. Notices shall be sent as follows: If to City: City of Moorpark Attn: City Manager 799 Moorpark Avenue Moorpark, CA 93021 If to Developer: Pacific Communities Builder, Inc. Attn: Nelson Chung 1000 Dove Street, Suite 300 Newport Beach, CA 92660 Each such notice, statement, demand, consent, approval, disapproval, authorization, offer, designation, request or other communication hereunder shall be deemed delivered to the party to whom it is addressed (a) if personally served or delivered, upon delivery, (b) if given by electronic communication, whether by facsimile upon the sender's receipt of an appropriate electronic confirmation, (c) if given by registered or certified mail, return receipt requested, -4- 9 2 12853-0001\2122615v1.doc deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (d) if given by overnight courier, with courier charges prepaid, 24 hours after delivery to said overnight courier, or (e) if given by any other means, upon delivery at the address specified in this Section. Section 7. Indemnification. The Developer hereby agrees to indemnify, defend (with counsel acceptable to the City), protect and hold harmless the City and its elective or appointive boards, council members, officers, and employees from any and all claims, rights, grievances, demands, damages, debts, liabilities, obligations, costs, expenses, causes of action, or damages of any kind or nature, including attorneys' fees, whether known or unknown, existing or potential, anticipated or unanticipated, or which may hereafter be sustained, arising out of or related to any acts or omissions taken by the Developer's officers, employees, contractors and agents with respect to this Deposit Agreement, the formation of CFD No. 2018-1, or the issuance of the Bonds, unless the same are caused by the negligence or willful misconduct of the City or its elective or appointive boards, council members, officers, and employees. This hold harmless agreement shall apply to all liability regardless of whether any insurance policies are applicable or insurance proceeds are available to the Developer. Any such policy limits do not act as a limitation upon the amount of indemnification to be provided by the Developer. Section 8. Release. Except in the event of the City's, or its elective or appointive boards, council members, officers, and employees, negligence or willful misconduct, the Developer hereby fully and irrevocably releases, waives, acquits and discharges the City and its electives or appointive boards, council members, officers, and employees of and from any and all claims, rights, grievances, demands, debts, liabilities, obligations, costs, expenses, causes of action, or damages of any nature, including attorney's fees, whether known or unknown, existing or potential, anticipated or unanticipated, or which may hereafter be sustained, arising out of, related to, or having any connection with this Deposit Agreement, the formation of CFD No. 2018-1, or the issuance of the Bonds. To this end, the Developer expressly waives and relinquishes all rights and benefits under California Civil Code Section 1542, which states as follows: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor." Section 9. California Law. This Deposit Agreement shall be governed and construed in accordance with the laws of the State of California. The parties shall be entitled to seek any remedy available at law and in equity. Section 10. Attorney's Fees. Anything else in this Deposit Agreement notwithstanding, if any party brings an action to enforce the terms hereof or declare its rights hereunder, the prevailing party in any such action shall be entitled to its reasonable attorneys' fees to be paid by the losing party as fixed by the court. Section 11. Successors and Assigns. This Deposit Agreement shall be binding - upon and inure to the benefit of the successors and assigns of the parties hereto. Upon transfer of -5- 9 3 12853-000112122615v 1.doc the Property to any subsequent landowner, this Agreement and all rights and obligations may be assigned to and assumed by such party without the prior written consent of the City. Section 12. Counterparts. This Deposit Agreement may be executed in counterparts, each of which shall be deemed an original and all of which shall constitute but one and the same instrument. Section 13. Other Agreements. The obligations of the Developer hereunder shall be that of a party hereto. Nothing herein shall be construed as affecting the City's or Developer's rights, or duties to perform their respective obligations, under other agreements, use regulations or subdivision requirements relating to the development. This Deposit Agreement shall not confer any additional rights, or waive any rights given, by either party hereto under any development or other agreement to which they are a party. Section 14. Titles and Captions. Titles and captions are for convenience of reference only and do not define, describe or limit the scope or the intent of this Deposit Agreement or of any of its terms. Reference to section numbers are to sections in this Deposit Agreement, unless expressly stated otherwise. Section 15. Interpretation. As used in this Deposit Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the context so dictates. The word "including" shall be construed as if followed by the words "without limitation." This Deposit Agreement shall be interpreted as though prepared jointly by both parties. Section 16. No Waiver. A waiver by either party of a breach of any of the covenants, conditions or agreements under this Deposit Agreement to be performed by the other party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Deposit Agreement. Section 17. Modifications. Any alteration, change or modification of or to this Deposit Agreement, in order to become effective, shall be made in writing and in each instance signed on behalf of each party. Section 18. Severability. If any term, provision, condition or covenant of this Deposit Agreement or its application to any party or circumstances §hall be held, to any extent, invalid or unenforceable, the remainder of this Deposit Agreement, or the application of the term, provision, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected, and shall be valid and enforceable to the fullest extent permitted by law. Section 19. Legal Advice. Each party represents and warrants to the other the following: they have carefully read this Deposit Agreement, and in signing this Deposit Agreement, they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters set forth in this Deposit Agreement, or have knowingly chosen not to consult legal counsel as to the matters set forth in this Deposit Agreement; and, they have freely signed this Deposit Agreement without any reliance upon any agreement, promise, statement or representation by or on behalf of -6- 9 4 12853-0001\2122615vI.doc the other party, or their respective agents, employees, or attorneys, except as specifically set forth in this Deposit Agreement, and without duress or coercion, whether economic or otherwise. Section 20. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, to sign any and all documents which may be reasonably necessary, helpful, or appropriate to carry out the purposes and intent of this Deposit Agreement including, but not limited to, releases or additional agreements. Section 21. Conflicts of Interest. No member, official or employee of the City shall have any personal interest, direct or indirect, in this Deposit Agreement, nor shall any such member, official or employee participate in any decision relating to the Deposit Agreement which affects his personal interests or the interests of any corporation, partnership or association in which he is directly or indirectly interested. [Signatures on following page] -7- 9 5 12853-0001\2122615v 1.doc IN WITNESS HEREOF, the parties have caused this Deposit to be executed on the date first written above. CITY OF MOORPARK: DEVELOPER: A public body, corporate and politic Pacific Communities Builder, Inc. By: Janice Parvin, Mayor Nelson Chung, President • ATTEST: Maureen Benson, City Clerk -8- 9 6 12853-0001\2122615v 1.doc EXHIBIT A Proposed Boundaries of CFD No. 2018-1 [see attached] -9- 9 7 12853-0001\2122615v1 doc