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1993-0408_SERRA_Agreementt 0 AGREEMENT SOUTH EAST REGIONAL RECLAMATION AUTHORITY PROJECT COMMITTEE NO. 21 FOR PARTICIPATION IN THE PROPOSED SERRA/AWMA/SOCRA PUBLIC FACILITIES FINANCING CORPORATION THIS AGREEMENT is made and entered into this 8th day of April , 1993, by and between the SOUTH EAST REGIONAL RECLAMATION AUTHORITY ("SERRA"), an entity created by that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South East Regional Reclamation Authority - © Orange County, California - (SERRA)" (the "JPA"), dated March 9, 1970, entered into under the provisions of Government Code Section 6500 et seq. by the parties to the JPA, which include the following parties: (a) Moulton Niguel Water District; (b) Santa Margarita Water District; and (c) City of San Juan Capistrano. The parties listed above under (a) through (d) are hereinafter collectively referred to as the "Project Committee Members". R E C I T A L S: A. SERRA was formed by the Project Committee Members and the other parties to the JPA for the purpose of pursuing in the most beneficial and economical manner a regional program for corbincd waste water reclamation and disposal within the San .Tuan watershed. F. SERRA, together with the Aliso Water Managemei.c A?ency (AWMA) and the South Orange County Reclamation Authority (SOCRA) (collectively referred to as the "Joint Powers Authorities", or individually as "Joint Power Authority"), desire to create a funding mechanism to collectively finance public facilities for the benefit of the various member agencies of the Joint Powers Authorities in order to provide increased recognition in the municipal. bond market, to reduce financing costs and to utilize other aspects of pooled financings for the benefit of the member agencies. C. A project committee of SERRA, designated Project Committee No. 21 (Facilities Corporation) has been formed for the purpose of creating a California nonprofit public benefit corporation (the "Public Facilities Corporation") in accordance with Sections 5002 through 6910 of the California Corporations Code, as amended from time to time (the "Nonprofit Corporation Law") in conjunction with AWMA and SOCRA to facilitate pooled PBG/3609 5/25/93 r • • financings for the acquisition and construction of waste water and reclamation facilities among the member agencies of SERRA, AWMA and SOCRA. NOW THEREFORE, in consideration of the mutual promises and covenants herein contained, the parties do agree as follows: 1. SERRA agrees to participate with AWMA and SOCRA in the formation and establishment of the Public Facilities Corporation and to take all actions with respect thereto, including but not limited to the drafting of appropriate articles of incorporation and corporate bylaws, filings with the Secretary of State, and any other requirements necessary for compliance with the Nonprofit Corporation Law. 2. The Project Committee Members will appoint a representative(s) to serve as director(s) on the Public Facilities Corporation board of directors. 3. Each of the Project Committee Members shall pay an equal one-third share of the costs incurred by SERRA for establishment of the Public Facilities Corporation, including but not limited to, all costs of State filings and the legal costs for drafting the bylaws and articles of incorporation (the "Formation Costs"). It is understood that certain member agencies of AWMA and SOCRA shall form project committees and participate in funding the Formation Costs, and that SERRA shall make a budget allocation of one-third of all such costs to each Joint Powers Authority and the corresponding project committee. It is anticipated that the Formation Costs will be reimbursed to the respective project committees of SERRA, AWMA and SOCRA concurrently with the execution and delivery of certificates of participation in conjunction with the Public Facilities Corporation, or as soon thereafter as possible in accnrdance with all applicable laws. 4. Upon formation of the Public Facilities Corporation, any annual costs incurred thereafter to maintain the status of such corporation (the "Annual Costs") shall also be divided in equal thirds among the Joint Powers Authorities. The Project Committee Members agree to each fund an equal share of SERRA's portion of the Annual Costs in accordance with regular budgetary procedures. 5. A condition to any other member agency of SERRA becoming a Project Committee Member herein is the payment by that member agency of a proportionate share of the original Formation Costs to SERRA. SERRA agrees to use any such 'buy -in' funds received from additional Project Committee Members to offset SERRA's one-third share of the Annual Costs during the existence of the Public Facilities Corporation. 6. The parties agree that participation in the Public Facilities Corporation as set forth by the terms of this Agreement is contingent upon the execution of similar project committee agreements by SOCRA and AWMA and member agencies or a member -2- PBG/3609 5/25/93 agency of each thereof no later than September 1, 1993. To the extent project committee agreements in substantially the form of this agreement are not executed by AWMA and SOCRA and member agency(ies) of each by such deadline date, this Agreement will terminate and have no further force or effect. 7. The parties agree that the terms of this Agreement do not provide any authority for the issuance of, or execution and delivery of, obligations by SERRA, the Project Committee Members or the Public Facilities Corporation, but only provide for SERRA's participation in the formation of the Public Facilities Corporation. Future financings undertaken by the Public Facilities Corporation will be set forth in documents, resolutions, indentures, trust agreements, etc., to be adopted and executed by SERRA and/or the Project Committee Members and the Public Facilities Corporation. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year written above. SOUTH EAS REGIONAL RECLAMATION AU THChaY By irman By YIA Secretary MOULTON NIGUEL_WATER DISTRICT i B resident By: V f retary/Assistap Secre c -3- PBG/3609 5/25/93 0 0 SANTA MARGARITA WATER DIy TRICT By/� -� President By e reta /Assistant Secretary CITY OF SAT JUAN CAPISTRANO By ayor WE �.1, WE -4- PBG/3609 5/25/93 9 January 24, 1994 dOWN" � ve I��,,r� ',inloltolllll nnm 1961 1776 Mr. Bill Becker, General Manager South East Regional Reclamation Authority 30290 Rancho Viejo Road San Juan Capistrano, California 92675 Re: Public Facilities Financing Corporation Dear Bill: MEMBERS OF THE CITY COUNCIL COLLENE CAMPBELL GARY L. HAUSDORFER GIL JONES CAROLYN NASH JEFF VASOUEZ CITY MANAGER GEORGE SCARBOROUGH At their meeting of January 18, 1994, the City Council of the City of San Juan Capistrano approved the agreement between SERRA, the Moulton Niguel Water District, the Santa Margarita Water District, and the City of San Juan Capistrano to provide for establishment of a Public Facilities Financing Corporation to reduce long-term debt financing costs. The City Council did not support participation in the debt financing for the Administration and Operations Building. Enclosed are three fully -signed copies of the agreement. The City has retained its copy. If you need any further information, please let us know. Very truly yours, Cheryl Johnson City Clerk Enclosures cc: Director of Engineering and Building (with copy of agreement) 32400 PASEO ADELANTO, SAN JUAN CAPISTRANO, CALIFORNIA 92675 • (714) 493-1171 0 0 Historic Town Center project was delayed longer than 12 months because the project was suspended by the City. Aooroval of Contract: It was moved by Council Member Nash, seconded by Council Member Jones, and unanimously carried that the Agreement for Consulting Services between the City and the firm of Williams-Kuebelbeck & Associates, Inc. be approved at a cost not to exceed $12,300, as amended to give the consultant the right to renegotiate fees if there was a delay greater than twelve months due to City suspension of the project. Written Communication: Report dated January 18, 1994, from the Director of Engineering and Building, recommending that the proposed Reimbursement Agreement between the City and Thomas A. Forster be approved for the design and construction of a storm drain system by Mr. Forster on Assessor's Parcel Nos. 121-171-46 and 121-171-47. The Agreement would provide a mechanism for the City to reimburse Mr. Forster in the amount of 5172,050 over a ten-year period, which represents half the estimated cost of designing and constructing the storm drain. An additional reimbursement to the City in the amount of $25,739 from future development would be credited to Mr. Forster within a 20 -year period. Approval of Reimbursement Agreement with Thomas A. Forster: It was moved by Council Member Hausdorfer, seconded by Council Member Jones, and unanimously carried that the Reimbursement Agreement between the City and Thomas A. Forster be approved. The Mayor and City Clerk were authorized to execute the Agreement on behalf of the City. The City Clerk was directed to forward the document to the Orange County Recorder. �s 2. APPROVAL OF ESTABLISHMENT OF A PUBLIC FACILITIES FINANCING CORPORATION BY THE SOUTH EAST REGIONAL RECLAMATION AUTHORITY (SERRA) (1040.60) Written Communication: Report dated January 18, 1994, from the Director of Engineering and Building, recommending that the City enter into an agreement with SERRA for participation in the Public Facilities Financing Corporation. The intent of the shell corporation would be to reduce long-term debt financing costs by pooling the joint resources of SERRA, the South Orange County Reclamation Authority, and the Aliso Water Management Agency, as well as to make the issuance of municipal bonds more attractive in the market and provide for lower interest rates. The Report noted that City staff did not support participation in the debt financing of the Administrative and Operation buildings because City reserves at SERRA were adequate to pay for both buildings. Approval of Agreement with SERRA and Non -Support of Participation in Debt Financing It was moved by Council Member Vasquez, seconded by Council Member Jones, and unanimously carried that: (1) The Agreement between the City and SERRA for participation in the Public Facilities Financing Corporation be approved, and (2) The City not support participation in debt financing for the Administration and Operations buildings. City Council Minutes -11- 1/18/94 AGENDA ITEM TO: FROM: SUBJECT: 1] George Scarborough, City Manager Ll January 18, 1994 William M. Huber, Director of Engineering be Building Approval of Establishment of a Public Facilities Financing Corporation by the South East Regional Reclamation Authority (SERRA) RECOMMENDATION It is recommended that City Council: 1. Approve an agreement with the South East Regional Reclamation Authority for participation in the Public Facilities Financing Corporation, authorize the Mayor to execute and City Clerk to attest said agreement. 2. Not support the participation in the debt financing for the Administration and Operations Buildings. SITUATION A. Summary and Recommendation The South East Regional Reclamation Authority (SERRA) is requesting the establishment of a Public Facilities Financing Corporation to help reduce long-term debt financing costs by pooling the joint resources of SERRA, South Orange County Reclamation Authority (SOCRA) and Aliso Water Management Agency (AWMA). This pooling of agencies will help to make issuance of municipal bonds more attractive in the market and provide for lower interest rates. The initial project for the corporation is the financing of the payback of the SERRA reserve funds utilized for acquisition of the Administration Building and the proposed construction of the Operations Building. City reserves at SERRA are adequate to pay for both buildings, therefore, staff is supportive of establishing the financing corporation but does not support participation in the debt financing of the Administrative and Operations Buildings. B. Background On July 7, 1992, the City Council approved a revision to the SERRA budget of $2,162,300 for purchase of an administrative office building and construction of an operations building at the SERRA facilities in Dana Point. The City's share of costs to be budgeted from Sewer User Fees was $748,490. On February 16, 1993, the City Council approved an agreement between SERRA and the member agencies for long-term debt financing to repay the use of the City's share of the SERRA reserve funds. FOR CRY COUNCIL AGEND 6 %,b AGENDA ITEM • • January 18, 1994 Page 2 Since approval of the financing agreement, SERRA has looked into the possibility of setting up a Public Facilities Financing Corporation. The idea is to set up a nonprofit corporation to act as a financing vehicle for the member agencies within not only SERRA but also including SOCRA and AWMA. The financing vehicle would have the advantage of pooling of the various agencies helping to lower costs of finance issuance by giving greater recognition in the municipal bond market. The nonprofit corporation being established would be a shell for any financing ventures proposed by the member agencies. Projects financed by the corporation would be assessed back to those member agencies benefiting from the projects. No costs to the City of San Juan Capistrano would be incurred as a result of funding other agency projects. The immediate use of the corporation is to finance the costs of Administrative and Operations Buildings that were taken from each agency's reserve account. The SERRA reserve account is not like a City reserve fund. Rather, it is money accumulated each year if expenditures are less than the actual budget expenses. The City has adequate reserve funds to pay for its entire share of the Administration and Operations Buildings. SERRA proposes to reestablish the full reserve fund for each member agency. Staff, however, believes there is no need to participate in the actual financing as we will incur debt financing costs that cannot be mitigated by the returned interest on the funds. Also, there is no need or requirement to maintain a reserve with such a high balance. The City will also continue to build reserve funds from future budgets. Staff, therefore, supports establishment of the financing corporation for future projects but does not support participation in financing the use for refunding the Administrative and Operations Building reserve fund. COMMISSION/BOARD REVIEW, RECOMMENDATIONS This item was discussed and approved by the SERRA Board at their meeting of April 8, 1993 (Attachment 2). FINANCIAL CONSIDERATIONS The total cost to establish the financing corporation is estimated between $4-5,000 which will be split among the member agencies and will come from sewer revenue. NOTIFICATION None ALTERNATE ACTIONS Approve as recommended. Approve subject to modifications. Return to staff for information. AGENDA ITEM • • January 18, 1994 Page 3 RECOMMENDATION It is recommended that City Council: 1. Approve an agreement with the South East Regional Reclamation Authority for participation in the Public Facilities Financing Corporation, authorize the Mayor to execute and City Clerk to attest said agreement. 2. Not support the participation in the debt financing for the Administration and Operations Buildings. Respectfully submitted, %Z4 William M. Huber, P.E. W MH:cl Attachments: 1. Agreement 2. Minutes from April 8, 1993, SERRA Board 4 • • II ITEM VII -B ACTION TAKEN: No action was required. ITEM VIII LEGAL MATTERS ITEM VIII -A SERRA PROJECT COMMITTEE NO 21 AGREEMENT FOR SOCRA DISCUSSION: Mr. Becker referenced Attachment #11, SERRA Project Committee No. 21 Agreement for Establishment of and Participation in a Public Facilities Financing Corporation with AWMA and SOCRA. As discussed previously, in order to put the financing together to provide funds for financing of the SERRA Administration Building and construction of the SERRA Operations Building, it was recommended that a new PC 21 be established as a financing mechanism. Mr. Becker deferred to Ms. Giannone on this Item. Ms. Giannone addressed the Board and stated that the purpose of this Project Agreement, which had also been presented to the SOCRA Board, was to set up some sort of non- profit corporation to act as a financing vehicle for the Member Agencies within the three Joint Powers Agencies, the idea being that the SERRA PC 2 project would in all likelihood be the first financing project. There may be other agencies who are contemplating financing for projects who might also wish to participate. The Project Committee Agreement was to - 10 - 1-10 ATTACHMENT 2 • ITEM VIII -A SERRA PROJECT COMMITTEE NO. 21 AGREEMENT FOR ESTABLISHMENT OF AND PARTICIPATION IN A PUBLIC FACILITIES FINANCING CORPORATION WITH AWMA AND SOCRA (Continued) DISCUSSION: (Continued) establish a regional financing vehicle available to cut down costs of issuance. The Project Committee Agreement provides for participation in a non-profit corporation. The formation costs for this non-profit corporation were estimated at $4,000 to $5,000, the legal time spent to put By -Laws and Articles of Incorporation together, tax filings with the State and annual costs to keep the status of a non-profit corporation. Director Woerner asked if approval was being requested subject to ratification by the individual Boards/Councils? Ms. Giannone responded affirmatively. She noted that there was a possibility that if, for some reason, the AWMA and SOCRA Agencies did not participate, SERRA could make up a financial corporation primarily for SERRA, go back and amend their Articles of Incorporation. In that case, SERRA would be financing the costs incorporation up front. Director Woerner asked that if an agency elected to delete themselves from this Project Committee, was it possible for them to join at a later time; DPSD had opted to pay off their share of the Administration Building and would like to delete themselves from PC 21 at this time. Ms. Giannone responded that there was a buy -in provision wherein agencies could join at a later time. Further discussion ensued. Director Woerner reiterated Wo 0 0 ' ITEM VIII -A SERRA PROJECT COMMITTEE NO 21 AGREEMENT FOR ESTABLISHMENT OF AND PARTICIPATION IN A PUBLIC FACILITIES FINANCING CORPORATION WITH AWMA AND SOCRA (Continued) DISCUSSION: (Continued) that tentatively, he would like to delete DPSD from the PC 21 Agreement until he has discussed this with the DPSD Board. Ms. Giannone noted that this Agreement was primarily to form 14 a joint corporation. Alternate Director Vasquez stated that the agencies were not, in fact, committing to a particular project; this was basically the shell? Ms. Giannone responded IN affirmatively. Chairman Wiper asked if there were any further questions or comments. ACTION TAKEN: Motion was made by Director Knitz and seconded by Alternate Director Vasquez to approve the SERRA Project Committee No. 21 Agreement for Establishment of and Participation in a Public Facilities Financing Corporation with AWMA and SOCRA subject to ratification by the individual Member Agency's Boards/Councils. Motion carried with five ayes (SMWD, MNWD, DPSD and CSJC) and one abstention (CSC). ITEM IX FINANCIAL AND ADMINISTRATIVE MATTERS 0 1-12 ITEM IX -A RECOMMENDATIONS OF THE FINANCE COMMITTEE CHAIRMAN WOERNER AND THE TREASURER 1. Summary of Disbursements DISCUSSION: Mr. Becker requested Board approval of the current bills and expenses in the amount of $392,260.01. ACTION TAKEN: Motion was made by Director Woerner and seconded by Director Knitz to approve the current bills and expenses in the amount of $392,260.01. Motion carried, with all Directors voting aye. - 12 - 0 1-12 MEMORANDUM TO: Memo to File FROM: Maria Guevara, Secretary DATE: August 2, 2002 SUBJECT: South Orange County Wastewater Authority (SOCWA) On March 20, 2001, SOCWA was created, eliminating Aliso Water Management Agency (AWMA), South East Regional Reclamation Authority (SERRA) and South Orange County Reclamation Authority (SOCRA). Agreements prior to March 20, 2002, may be found under SERRA. Agreements after March 20„ 2002, may be found under SOCWA.