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CITY COUNCIL AGENDA ITEM NO. 19

Meeting Date: April 25, 2000 

Subject/Title: Appointment of Underwriter, Bond Counsel and Engineer of Work and approval of Deposit and Reimbursement Agreements in and for Assessment District No. 2000-1 and CIFP 2000-1 

Submitted by: Engineering: J. Stevenson/P. Eldredge 

Approved by: Jon Elam, City Manager 

RECOMMENDATION

Approve a Resolution appointing an Underwriter, Bond Counsel and Engineer of Work and approving Deposit and Reimbursement Agreements in and for CIFP 2000-1 and Assessment District No. 2000-1.

PREVIOUS ACTION

No previous action has been taken for CIFP 2000-1.

BACKGROUND

The City of Brentwood has a long history of utilizing Assessment District financing to assist in the funding of master-planned infrastructure.  Six developers have requested the preparation of a Capital Improvement Financing Program and the formation of an Assessment District to assist in funding the facilities included in the CIFP report.

The developers included in this CIFP and Assessment District are:

1.      Grupe Communities (Nunn/Baez)

2.      Pulte Home Corporation (Condon/Cunha)

3.      Pulte Communities (Blackhawk Active Adult)

4.      Beck Properties

5.      DeNova Homes (Laird)

6.      Martin Land Company (Sciortino)

The attached exhibit depicts the properties involved in this program.  All properties now have, or will have prior to formation of any Assessment District, an approved Tentative Map and Conditions of Approval.

Facility Fee credits will be incorporated into the CIFP report so the City and the developers will have a complete picture of the costs associated with this program.

The resolution submitted for approval with this report are the initial actions required by the City Council to start the process of formation of CIFP 2000-1 and Assessment District No. 2000-1.  This CIFP incorporates 980 lots in single family residential development.

The developers will provide funding for the City’s costs associated with this program.  They have each submitted $15,000 to start the work.  This CIFP will construct or fund approximately $9.6 million of infrastructure through the prepayment of facility fees or the construction of improvements.

Attachments:

Resolution

Site Map

Form of Deposit and Reimbursement Agreement to be entered into between the City and each Developer

RESOLUTION NO.  

RESOLUTION APPOINTING AN UNDERWRITER, BOND COUNSEL, AND ENGINEER OF WORK, AND APPROVING DEPOSIT AND REIMBURSEMENT AGREEMENTS FOR CIFP 2000-1 AND ASSESSMENT DISTRICT NO. 2000-1 

                WHEREAS, the City of Brentwood (the “City”) has determined to commence proceedings for its Capital Improvement Financing Plan 2000-1 (“CIFP 2000-1”); and 

                WHEREAS, the City Council has determined to undertake certain proceedings toward the establishment of an assessment district pursuant to the Municipal Improvement Act of 1913 (Division 12 of the California Streets and Highways Code) to be named “Assessment District No. 2000-1, City of Brentwood, Contra Costa County, California” (hereinafter, the “Assessment District”) for the purposes of acquiring certain public improvements to be constructed in said Assessment District, and to issue bonds secured by the unpaid assessments to be levied in the Assessment District pursuant to the Improvement Bond Act of 1915 (Division 10 of the California Streets and Highways Code); and 

                WHEREAS, a form of the Deposit and Reimbursement Agreement between the City and each of the developers (the “Developer” as defined in each of the Deposit and Reimbursement Agreements), dated as of April 25, 2000, is on file with the City Clerk and presented to this meeting; and 

                WHEREAS, the City now desires to appoint the members of the financing team to enable the City to pursue said proceedings and financing. 

                NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BRENTWOOD HEREBY RESOLVES, AS FOLLOWS: 

                Section 1.  The foregoing recitals are true and correct, and this City Council so finds and determines. 

                Section 2.  The City hereby determines to undertake proceedings for CIFP 2000-1 and hereby directs the City Engineer to prepare and present to this Council a CIFP 2000-1 report. 

                Section 3.  The City hereby determines to undertake proceedings pursuant to the Municipal Improvement Act of 1913 for the acquisition of public improvements to be constructed in the Assessment District and hereby directs the City Manager, City Treasurer, Finance Director, City Engineer, City Attorney, and all other officers and employees of the City to prepare or cause to be prepared proceedings to accomplish same and to submit same to the City for consideration at the earliest practical opportunity. 

                Section 4.  The firm of Sutro & Co., Inc. is hereby appointed Underwriter for said financing in accordance with an existing agreement between the City and Sutro & Co., Inc., a copy of which is on file with the City Clerk. 

                Section 5.  The firm of Orrick, Herrington & Sutcliffe LLP is hereby appointed Bond Counsel for said financing in accordance with that certain agreement on file with the City Clerk and presented to this meeting (the “Legal Agreement”).  The City Manager is hereby authorized and directed to execute and deliver the Legal Agreement and the City Clerk is authorized to attest its execution. 

                Section 6.  The City Engineer of the City is hereby appointed Engineer of Work for the Assessment District and is hereby authorized and directed to do and perform all assessment engineering work necessary in and for said Assessment District proceedings, including the preparation of a map of the Assessment District and the descriptions of the public improvements to be acquired, together with estimates of costs thereof, an assessment diagram, an assessment roll, and the method of spread of the assessments, all as required and described in Section 10204 of the California Streets and Highways Code. 

            Section 7.  The Deposit and Reimbursement Agreements, dated as of April 25, 2000, by and between the City and the respective Developers within the proposed CIFP 2000-1, are hereby approved.  The City Manager is hereby authorized and directed to execute and deliver the Deposit and Reimbursement Agreements. 

                Section 8.  This resolution shall take effect immediately upon its passage. 

                PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting on the 25th day of April 2000, by the following vote: 

AYES:    Councilmembers

NOES:

ABSENT:

 

                     DEPOSIT AND REIMBURSEMENT AGREEMENT

City of Brentwood

(CIFP 2000-1 and Assessment District No. 2000-1) 

Recitals

            The parties to this agreement are the City of Brentwood, a California general law city (the “City”), and [DEVELOPER] (the “Developer”).

The effective date of this agreement shall be April 25, 2000.

            The Developer has requested the City to prepare a capital improvement financing plan (“CIFP 2000-1”) for public improvements related to the development of the Developer’s property and other property located in the City and owned by other developers.

            The Developer has requested the City to implement special assessment proceedings for the purposes stated in the petitions, said proceedings to be taken pursuant to the Municipal Improvement Act of 1913 (Sections 10000 and following, California Streets and Highways Code), and to issue and sell limited obligation improvement bonds of the City upon the security of the unpaid special assessments levied and recorded against certain real property which the Developer has acquired or is in the process of acquiring and developing in accordance with CIFP 2000-1.            In the event the City is able to accomplish sale and delivery of the limited obligation improvement bonds, pursuant to the Improvement Bond Act of 1915 (Sections 8500 and following, Streets and Highways Code) (hereafter the “1915 Act Bonds”), the City intends to utilize the proceeds of sale thereof pursuant to the terms and conditions of this agreement to (1) reimburse the Developer for the deposit required by this agreement and (2) acquire the completed public improvements from the Developer, all in accordance with and subject to the terms and conditions of this agreement.

            In consideration for the mutual undertakings of the parties stated herein, the parties agree as follows.

Agreement

            The foregoing recitals are true and correct, and the parties expressly so acknowledge.

            Forthwith upon approval of this agreement by the City Council of the City and execution hereof by the authorized representatives of the parties, the Developer will deposit with the City $15,000 into a special fund to be established and maintained by the City and to be known as the “Assessment District No. 2000-1 Improvement Fund”.  The City is authorized to disburse amounts from said fund, from time to time, to pay preliminary and incidental costs and expenses incurred by the City in connection with the City’s proceedings to implement the proposed CIFP 2000-1 and Assessment District No. 2000-1 as requested by the Developer.  Without limiting the generality of the foregoing, the City may disburse amounts from said fund to other appropriate funds or accounts of the City to reimburse the City for the reasonable cost of staff time devoted to said proceedings, as well as to pay third party invoices from consultants retained by the City to assist the City in the implementation of the proposed CIFP 2000-1 and Assessment District No. 2000-1.

In the event that the balance in said fund is drawn down to an amount of less than $5,000, the City may notify the Developer of such fact, and the Developer shall forthwith provide the City with an additional deposit of $5,000 to assure the continued availability of funds for the payment of such preliminary expenses.

            Upon receipt of a written engineer’s report prepared in accordance with and containing the matters required by Section 10204 of the Streets and Highways Code, the City agrees to proceed with all due diligence in conducting and completing the legal proceedings pursuant to the Municipal Improvement Act of 1913, leading to recording of the special assessments levied upon the various parcels of land of the Developer as foreclosable liens upon such parcels.  The City Engineer, as the Engineer of Work for said legal proceedings, shall be instructed to include in the incidental expenses listed in the cost estimate in the written engineer’s report an amount estimated to be sufficient to reimburse the Developer for the full amount of the deposits made and to be made by the Developer pursuant to this agreement.

            The City shall proceed with all due diligence to accomplish issuance and sale of the 1915 Act Bonds upon the security of the recorded assessments to accomplish the authorized purposes of Assessment District No. 2000-1, including but not limited to reimbursement to the Developer for its deposit or deposits pursuant to this agreement and to acquire the completed work and improvements from the Developer upon completion; it being expressly understood that the City has no obligation to proceed with such acquisition until the subject work and improvements have been fully completed to the satisfaction of the City, as determined by the City Engineer of the City or his designee, in the sole discretion of such person, such discretion not to be exercised arbitrarily or unreasonably.

            The City agrees to use its best efforts to accomplish a public offering and sale of the proposed 1915 Act Bonds, it being understood that the City intends to accomplish such offering and sale through a negotiated sale to Sutro & Co., San Francisco, California.  To enable the City and Sutro & Co., Inc. to prepare an Official Statement to be utilized in connection with Sutro & Co., Inc.’s public offering of the proposed 1915 Act Bonds, the Developer agrees to provide such financial information, development program information, title reports, appraisal reports, and such other information as Sutro & Co., Inc. may consider material in connection with preparing the Official Statement and determining feasibility and structure of the proposed 1915 Act Bond issue.  Such reports and information shall be provided to the City and to Sutro & Co. at no cost to either, and the actual cost and expense of the Developer shall be eligible for reimbursement from bond sale proceeds, provided that sufficient allowance has been made in the cost estimate and bond sale for that purpose.

            Prior to the issuance or sale of the bonds, the City and the Developer shall enter into an acquisition agreement setting forth, among other things, the terms upon which the City will acquire said improvements.

IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed by their authorized representatives as of the effective date stated above.

City of Brentwood 

[Form of Agreement] 

City of Brentwood

(CIFP 2000-1 and Assessment District No. 2000-1)

DEPOSIT AND REIMBURSEMENT AGREEMENT

By and Between 

City of Brentwood 

and 

[DEVELOPER]

Dated as of April 25, 2000

City Administration
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