10-1207_FIELDMAN, ROLAPP & ASSOCIATES_Personal Services Agreement PERSONAL SERVICES AGREEMENT
THIS AGREEMENT is made, entered into, and shall become effective this 7th
day of December, 2010, by and between the City of San Juan Capistrano (hereinafter
referred to as the "City") and Fieldman, Rolapp and Associates (hereinafter referred to
as the "Consultant").
RECITALS:
WHEREAS, City desires to retain independent financial advisory service in
connection with the execution and delivery of certificates of participation to fund the
acquisition and construction of certain public water improvements described as follows:
2011 Water Revenue Certificates of Participation (for convenience of reference the
"Certificates"); and
WHEREAS, City desires to retain professional and technical services of the
Consultant for the purposes of debt issuance related to the financing the acquisition and
construction of said facilities.
WHEREAS, Consultant is qualified by virtue of experience, training, education
and expertise to accomplish such services.
NOW, THEREFORE, City and Consultant mutually agree as follows:
Section 1. Scope of Work.
The scope of work to be performed by.Consultant shall consist of those tasks as
set forth in Exhibit "A," attached and incorporated herein by reference. To the extent
that there are any conflicts between the provisions described in Exhibit "A" and those
provisions contained within this Agreement, the provisions in this Agreement shall
control.
Section 2. Term.
The services provided under this agreement shall commence upon execution of
Agreement by all parties. The services provided under this Agreement shall be
completed on or before certificates are closed or the project is abandoned, whichever
occurs first.
Section 3. Compensation.
3.1 Amount.
Consultant contract billings may be submitted on the consultant's forms
and, at a minimum, should contain.the,following:
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Title of project(s)
Total approved contract amount
Amount paid to date
Amount requested
Amount remaining on contract
Breakdown of amounts by project type or account number
Three copies of itemized bills, clearly indicating the monthly period for which the
billing is made, shall be submitted to: The City of San Juan Capistrano, Attention: Chief
Financial Officer, 32400 Paseo Adelanto, San Juan Capistrano, California 92675.
Total compensation for the services hereunder shall not exceed $40,500 plus a
not to exceed cap of $3,500 for expenses set forth in,Exhibit B.
3.2 Method of Payment.
Subject to Section 3.1, Consultant shall be compensated pursuant to
Exhibit A, Section 3 and Exhibit B and Consultant's fee shall be contingent and payable
at the closing of the debt issue.
3.3 Records of Expenses.
Consultant shall keep complete and accurate records of all costs and
expenses incidental to services covered by this Agreement. These records will be
made available at reasonable times to City.
Section 4. Independent Contractor.
It is agreed that Consultant shall act and be an independent contractor and not
an agent or employee of City, and shall obtain no rights to any benefits which accrue to
City's employees.
Section 5. Limitations Upon Subcontracting and Assi nment.
The experience, knowledge, capability and reputation of Consultant, its principals
and employees were a substantial inducement for City to enter into this Agreement.
Consultant shall not contract with any other entity to perform the services required
without written approval of the City. This Agreement may not be assigned, voluntarily or
by operation of law, without the prior written approval of the City. If Consultant is
permitted to subcontract any part of this Agreement by City, Consultant shall be
responsible to City for the acts and omissions of its subcontractor as it is for persons
directly employed. Nothing contained in this Agreement shall create any contractual
relationships between any subcontractor and City. All persons engaged in the work will
be considered employees of Consultant. City will deal directly with and will make all
payments to Consultant.
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Section 6. Changes to Scope of Work.
For extra work not part of this Agreement, a written authorization from City is
required prior to Consultant undertaking any extra work. In the event of a change in the
Scope of Work provided for in the contract documents as requested by the City, the
Parties hereto shall execute an addendum to this Agreement setting forth with
particularity all terms of the new agreement, including but not limited to any additional
Consultant's fees.
Section 7. Familiarity with Work and/or Construction Site.
By executing this Agreement, Consultant warrants that: (1) it has investigated
the work to be performed; (2) if applicable, it has investigated the work site(s), and is
aware of all conditions there; and (3) it understands the facilities, difficulties and
restrictions of the work to be performed under this Agreement. Should Consultant
discover any latent or unknown conditions materially differing from those inherent in the
work or as represented by City, it shall immediately inform the City of this and shall not
proceed with further work under this Agreement until written instructions are received
from the City.
Section 8. Time of Essence.
Time is of the essence in the performance.of this Agreement.
Section 9. Compliance with Law; E-Verify.
9.1. Compliance with Law.
Consultant shall comply with all applicable laws, ordinances, codes and
regulations of federal, state and local government.
9.2. E-Verify.
If Consultant is not already enrolled in the U.S. Department of Homeland
Security's E-Verify program, Consultant shall enroll in the E--Verify program within fifteen
days of the effective date of this. Agreement to verify the employment authorization of
new employees assigned to perform work hereunder. Consultant shall verify
employment authorization within three days of hiring a new employee to perform work
under this Agreement. Information pertaining to the E-Verify program can be found at
http:11www.uscis.gov, or access the registration page at https://www.vis-
dhs.com/employerregistration. Consultant shall certify its registration with E-Verify and
provide its registration number witfiih sixteen days of the effective date of this
Agreement. Failure to provide certification will result in withholding payment until full
compliance is demonstrated.
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Section 10, Conflicts of Interest.
Consultant covenants that it presently has no interest and shall not acquire any
interest, direct or indirect, which would conflict in any manner or degree with the
performance of the services contemplated by this Agreement. No person having such
interest shall be employed by or associated with Consultant.
Section 11. Copies of Work Product.
At the completion of the work, Consultant shall have delivered to City at least one
(1) copy of any final reports and/or notes or drawings containing Consultant's findings,
conclusions, and recommendations with any supporting documentation. All reports
submitted to the City shall be in reproducible format, or in the format otherwise
approved by the City in writing.
Section 12. Ownership of Documents.
All reports, information, data and exhibits prepared or assembled by Consultant
in connection with the performance of its services pursuant to this Agreement are
confidential to the extent permitted by law, and Consultant agrees that they shall not be
made available to any individual or organization without prior written consent of the City.
All such reports, information, data, and exhibits shall be the property of the City and
shall be delivered to the City upon demand without additional costs or expense to the
City. The City acknowledges such documents are instruments of Consultant's
professional services.
Section 13. Indemnity.
To the fullest extent permitted Eby law; Consultant agrees to protect, defend, and
hold harmless the City and its elective and appointive boards, officers, agents, and
employees from any and all claims, liabilities, expenses, or damages of any nature,
including attorneys` fees, for injury or death of any person, or damages of any nature,
including interference with use of property, arising out of, or in any way connected with
the negligence, recklessness and/or intentional. wrongful conduct of Consultant,
Consultant's agents, officers, employees, subcontractors, or independent contractors
hired by Consultant in the performance of the Agreement. The only exception to
Consultant's responsibility to protect, defend, and hold harmless the City, is due to the
negligence, recklessness and/or wrongful conduct of the City, or any of its elective or
appointive boards, officers, agents, or employees.
This hold harmless agreement shall apply to all liability regardless of whether any
insurance policies are applicable. The: policy limits do not act as a limitation upon the
amount of indemnification to be provided by Consultant.
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Section 14. Insurance.
4n or before beginning any of the services or work called for by any term of this
Agreement, Consultant, at its own cost and expense, shall carry, maintain for the
duration of the agreement, and provide proof.thereof that is acceptable to the City, the
insurance specified below with insurers and under forms of insurance satisfactory in all
respects to the City. Consultant shall not allow any subcontractor to commence work
on any subcontract until all insurance required of the Consultant has also been obtained
for the subcontractor. Insurance required herein shall be provided by Insurers in good
standing with the State of California and. having a minimum Best's Guide Rafting of A-
Class VII or better.
14.1 Comprehensive General Liability.
Throughout the term of this Agreement, Consultant shall maintain in full
force and effect Comprehensive General Liability coverage in an amount not less than
one million dollars per occurrence ($1,000,000.00), combined single limit coverage for
risks associated with the work contemplated by this agreement. If a Commercial
General Liability Insurance form or other form with a general aggregate limit is used,
either the general aggregate limit shall apply separately to the work to be performed
under this agreement or the general aggregate limit shall be at least twice the required
occurrence limit.
14.2 Comprehensive Automobile Liability.
Throughout the term of this Agreement, Consultant shall maintain in full
force and effect Comprehensive Automobile Liability coverage, including owned, hired
and non-owned vehicles in an amount not fess than one million dollars per occurrence
($1,000,000.00).
14.3 Worker's Compensation.
If Consultant intends to employ employees to perform services under this
Agreement, Consultant shall obtain and.maintain, during the term of this Agreement,
Worker's Compensation Employer's , Liability Insurance in the statutory amount as
required by state law.
14.4 Proof of Insurance Req.uirements/Endorsement.
Prior to beginning any work under this Agreement, Consultant shall submit
the insurance certificates, including the deductible or self-retention amount, and an
additional insured endorsement naming City, its officers, employees, agents, and
volunteers as additional insureds as respects each of the following: Liability arising out
of activities performed by or on behalf of Consultant, including the insured's general
supervision of Consultant; products and completed operations of Consultant; premises
owned, occupied or used by Consultant; or automobiles owned, leased, hired, or
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borrowed by Consultant. The coverage shall contain no special limitations on the scope
of protection afforded City, its officers, employees, agents, or volunteers.
14.5 Errors and Omissions Coverage [FOR PROFESSIONSIWORK
EXCLUDED FROM GENERAL LIABILITY]
Throughout the term of this Agreement, Consultant shall maintain Errors
and Omissions Coverage (professional liability coverage) in an amount of not less than
One Million Dollars ($1,000,000). Prior to beginning any work under this Agreement,
Consultant shall submit an insurance certificate to the City's General Counsel for
certification that the insurance requirements of this Agreement have been satisfied.
14.6 Notice of Cancellation/Termination of Insurance.
The above policy/policies shall not terminate, nor shall they be cancelled,
nor the coverages reduced, until after thirty (30) days' written notice is given to City,
except that ten (10) days' notice shall be given if there is a cancellation due to failure to
pay a premium.
14.7 Terms of Compensation.
Consultant shall not receive any compensation until all insurance
provisions have been satisfied.
14.8 Notice to Proceed.
Consultant shall not proceed with any work under this Agreement until the
City has issued a written "Notice to Proceed" verifying that Consultant has complied
with all insurance requirements of this Agreement.
Section 15. Termination.
City shall have the right to terminate this Agreement without cause by giving
thirty (30) days' advance written notice of':termination to Consultant.
In addition, this Agreement may be terminated by any party for cause by
providing ten (10) days' notice to the other party of a material breach of contract. If the
other party does not cure the breach of contract, then the agreement may be terminated
subsequent to the ten (10) day cure period.
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Section 16. Notice.
All notices shall be personally delivered or mailed to the below listed addresses,
or to such other addresses as may be designated by written notice. These addresses
shall be used for delivery of service of process:
To City: City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attn: Cindy Russell, Chief Financial Officer/City Treasurer
To Consultant: Fieldman, Rolapp and Associates
19900 MacArthur Blvd., Suite 1100
Irvine, CA 92612
Attn: James Fabian
Section 17. Attorneys" Fees.
If any action at law or in equity is necessary to enforce or interpret the terms of
this Agreement, the prevailing party shall be entitled to reasonable attorneys' fees, costs
and necessary disbursements in addition to any other relief to which he may be entitled.
Section 18. Dispute Resolution.
In the event of a dispute arising between the parties regarding performance or
interpretation of this Agreement; the dispute shall be resolved by binding arbitration
under the auspices of the Judicial Arbitration and Mediation Service ("JAMS").
Section 19. Entire Agreement.
This Agreement constitutes the entire understanding and agreement between the
parties and supersedes all previous negotiations between them pertaining to the subject
matter thereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
CITY OF SAN JUAN CAPISTRANO
By:
Joe Ta' , tity Manager
CONSULTANT
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ATTEST' r'
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City CEer
APPROVED AS TO FORM:
City Attorney
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EXHIBIT A
TO
PROFESSIONAL SERVICES AGREEMENT FOR FINANCIAL ADVISOR
BY AND BETWEEN
THE CITY OF SAN JUAN CAPISTRANO
AND
FIELDMAN,ROLAPP&ASSOCIATES
Scope of Services
A. General Services.
The Consultant shall perforin all the duties and services specifically set forth herein and shall
provide such other services as it deems necessary or advisable, or are reasonable and necessary to
accomplish the intent of this Agreement in a manner consistent with the standards and practice of
professional.financial.advisors prevailing at the time such services are rendered to the City.
The City may, with the concurrence of Consultant, expand this Agreement to include any
additional services not specifically identified within the terms of this Agreement. Any additional
services may be described in an addendum to this Exhibit A and are subject to fees described in
Exhibit B to this Agreement.
B. Debt Issuance Services.
The Consultant shall assume primary responsibility for assisting the City in coordinating the
planning and execution of each debt issue relating to the Project. Insofar as the Consultant is
providing Services which are rendered only to the City, the overall coordination of the financing
shall be such as to minimize the costs of the transaction coincident with maximizing the City's
financing flexibility and capital market access. The Consultant's proposed debt issuance Services
may include, but shall not be limited to, the following:
• Establish the Financing Objectives
• Develop the Financing Schedule
• Monitor the Transaction Process
• Review the Official Statement, both preliminary and final
• Procure and Coordinate Additional Service Providers
• Provide Financial Advice to the City Relating to Financing Documents
• Compute Sizing and Design Structure of the Debt Issue
Plan and Schedule Rating Agency Presentation and Investor Briefings
• Conduct Credit Enhancement Procurement and Evaluation
• Conduct Market Analysis and Evaluate Timing of Market Entry
• Recommend Award of Debt Issuance
• Provide Pre-Closing and Closing.Assistance
CITY OF SAN JUAN CA.PISTRANOIF'IELUMAN,ROLAPP&ASSOCIATES Exhibit A, Page 1
Specifically, Consultant will:
1. Establish the Financing Objectives.
At the onset of the financing transaction process for the Project, the Consultant shall
review the City's financing needs and in conjunction with the City's management, outline
the objectives of the financing transaction to be undertaken and its proposed form.
Unless previously determined, Consultant shall recommend the method of sale of debt
and outline the steps required to achieve efficient market access.
2. Develop the Financing.Timetable.
The Consultant shall take the lead role in preparing a schedule and detailed description of
the interconnected responsibilities of each team member and update this schedule, with
refinements, as necessary, as the work progresses.
3. Monitor the Transaction Process.
The Consultant shall have primary responsibility for the successful implementation of the
financing strategy and timetable that is adopted for each debt issue relating to the Project.
The Consultant shall coordinate (and assist, where appropriate) in the preparation of the
legal and disclosure documents and shall monitor the progress of all activities leading to
the sale of debt. The Consultant shall prepare the timetables and work schedules
necessary to achieve this end in a timely, efficient and cost-effective manner and will
coordinate and monitor the activities of all parties engaged in the financing transaction.
4. Review the Official Statement.
a. Generally, SEC, MSRB, and GFOA guidelines encourage full disclosure so
that potential investors have sufficient data to analyze each proposed
financing. Upon direction of the City, the Consultant shall take the lead in
review of the official statement for each debt issue relating to the Project to
insure that the City's official statement is compiled in a manner consistent
with industry standards, typically including the following matters:
• Legal Authority for the Financing
• Security for the Financing
• Restrictions on Additional Financings
• Purpose and Funds for which the Financing is Being Issued
• Governmental Systean.
• Financial Management System
® Revenue Sources: Historic, Current and Projected
• Outstanding Financings
• Planned Future Financings
• Labor Relations and Retirement Systems
• Economic Base
® Annual Financial Statements
• Legal Opinions Regarding Tax Exemption
• Such Other Matters as the Context May Require.
CITY OF SAN JUAN CAPISTRANO/FIELDMAN,ROLAPP&ASSOCIATES Exhibit A, Page 2
b. The Consultant shall maintain and update the official statement on its word
processing system until such time as it is near final and suitable for transfer
to the financial printer, in order to minimize the costs of revisions made by
the printer.
5. Procure and Coordinate Additional Service Providers.
Should the City desire, the Consultant may act as City's representative in procuring the
services of financial printers for the official statement and related documents, and for the
printing of any securities. In addition, the Consultant may act as the City's representative
in procuring the services of trustees, paying agents, fiscal agents, feasibility consultants,
redevelopment consultants, or escrow verification agents or other professionals, if the
City directs.
6. Provide Financial Advice to the City Relating to.Financing Documents.
Simultaneous with assisting in the preparation of official statements for each debt issue
relating to the Project, the Consultant shall. assist the managing underwriters, bond
counsel and/or other legal. advisors in the drafting of the respective financing resolutions,
notices and other legal documents. In this regard, the Consultant shall monitor document
preparation for a consistent and accurate presentation of the recommended business terms
and financing structure of each debt issue relating to the Project, it being specifically
understood however that the Consultant's services shall in no manner be construed as the
Consultant engaging in the practice of law.
7. Compute Sizing and Design Structure of Debt Issue.
The Consultant shall work with the City's staff to design a financing structure for each
debt issue relating to the Project that is consistent with the City's objectives, that
coordinates each transaction with outstanding issues and that reflects current conditions
in the capital markets.
8. Plan and Schedule Rating Agency Presentation and.Investor Briefings.
The Consultant shall develop a plan for presenting the financing program to the rating
agencies and the investor community. The Consultant shall schedule rating agency visits,
if appropriate, to assure the appropriate and most knowledgeable rating agency personnel
are available for the presentation and will develop presentation materials and assist the
City officials in preparing for the presentations.
9. Conduct Credit Enhancement Evaluation and Procurement.
Upon the City's direction, the Consultant will initiate discussions with bond insurers,
letter of credit providers and vendors of other forms of credit enhancements to determine
the availability of and cost benefit of securing financing credit support.
CITY OF SAN JUAN CAPISTRANO/FIELDMAN, ROLAPP&ASSOCIATES Exhibit A, Page 3
10. Conduct Market Anal sis and Evaluate Timing of Market Entty.
The Consultant shall provide regular summaries of current municipal market conditions,
trends in the market and how these may favorably or unfavorably affect the City's
proposed financing.
Competitive Sales.
For all types of competitive sale of debt, the Consultant shall undertake such
activities as are generally required for sale of securities by competitive bid
including, but not limited to the following:
• Review and comment on terms of Notice of Sale Inviting Bids
• Provide advice on debt sale scheduling
• Provide advice on the use of electronic bidding systems
• Coordinate bid opening with the City officials
• Verify bids received and make recommendations for acceptance
• Provide confirmation of issue sizing, based upon actual bids received,
where appropriate
• Coordinate closing arrangements with the successful bidder(s)
11. Recommend Award of Debt Issuance.
Based upon activities outlined in task above, the Consultant will recommend
accepting or rejecting offers to purchase the debt issue. If the City elects to award the
debt issue, the Consultant will instruct all parties and help facilitate the actions
required to formally consummate the award.
12. Provide Pre-Closing and Closing.Activities.
The Consultant shall assist in arranging for the closing of each financing. The
Consultant shall assist counsel in assuming responsibility for such arrangements as
they are required, including arranging for or monitoring the progress of bond
printing, qualification of issues for book-entry status, signing and final delivery of the
securities andsettlement of the costs of issuance.
CITY OF SAN.YUAN CAPISTRANO/FIELDMAN,ROLAPP&ASSOCIATES Exhibit A, Page 4
EXHIBIT B
TO
FINANCIAL ADVISORY SERVICES AGREEMENT
BY AND BETWEEN
CITY OF SAN,YUAN CAPISTRANO AND FIELDMAN, ROLAPP & ASSOCIATES
Fees and Expenses
Part 1: Fee for Services
Financial Advisory Services performed pursuant to Section I of this Agreement, and as more
fully described in the Scope of Services set forth in Exhibit A, will be billed:for at the amounts set
forth below:
Transaction Size Fees
$1 to $25,000,000 $52,500
$25,000,001 and above to be negotiated
Payment of fees earned by Consultant pursuant to this fart 1. shall be contingent on, and payable
at the closing of the debt issue(s) undertaken to finance the Project. If the City elects to refund
the outstanding 2002 Certificates of Participation, an additional fee of$8,000 will be added.
Part 2: Other Services
Unless agreed to otherwise, financial advisory services performed pursuant to Section 2 of this
Agreement will be billed at the then current hourly rates. The table below reflects the rates in
effect as of the date of execution of this Agreement.
Personnel Hourly Rate
Executive Officers............................................................$300.00
Principals..........................................................................$290.00
Senior Vice President.......................................................$275.00
Vice Presidents.................................................................$225.00
Assistant Vice President...................................................$195.00
Senior Associate...............................................................$150.00
Associate...........................................................................$125.00
Analyst................................................................................$85.00
Administrative Assistants...................................................$65.00
Clerical...................... ..............................$35.00
Expenses
Expenses will be billed for separately and will cover, among other things, travel, lodging,
subsistence, Overnight courier, posting of POS on internet, computer, and fax transmission
charges. Advances made on behalf of the City for costs of preparing, printing or distributing
disclosure materials or related matter whether by postal services or electronic means, may also be
billed through to the City upon prior authorization. Additionally, a surcharge of 6% of the net fee
CITY OF SAN JUAN CAPISTRANO/ IELDMAN,ROLAPP&ASSOCIA"T"ES Exhibit B, Page I.
amount is added to verifiable out-of-pocket costs for recovery of costs such as telephone, postage,
document reproduction and the like.
Limiting Terms and Conditions
The above fee is based on completion of work orders within six months of the City's
authorization to proceed, and assumes that the City will provide all necessary information in a
timely manner.
The fee shown above in Part 1 presumes attendance at up to 8 meetings i.n the City's offices or
such other location within a 25-mile radius of the City place of business as the City may
designate. Preparation for, and attendance at City Council meetings on any basis other than "by
appointment" may be charged at our normal hourly rates as shown in Part 2, above.
Abandonment
If, once commenced, the services of the Consultant are terminated prior to completion of our final.
report for any reason, we are to be reimbursed for professional services and direct expenses
incurred up to the time we receive notification of such termination at the standard hourly rates
shown in Part 2, subject to a minimum charge of 0.
CITY OF SAN JUAN CAPISTRANOIFIELDMAN, ROLAPP&ASSOCIATES Exhibit B, Page 2
RESOLUTION NO. 10-12-07-03
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SAN JUAN CAPISTRANO REGARDING ITS INTENTION
TO ISSUE TAX-EXEMPT OBLIGATIONS AND TO
REIMBURSE THE CITY FROM PROCEEDS OF SUCH
OBLIGATIONS FOR COSTS INCURRED PRIOR TO
ISSUANCE (WATER SYSTEM IMPROVEMENTS)
WHEREAS, the City Council of the City of San Juan Capistrano (the
"Issuer") desires to finance the costs of acquiring certain public facilities and
improvements, as provided in Exhibit A attached hereto and incorporated herein (the
"Project");
WHEREAS, the Issuer intends to finance the acquisition of the Project or
portions of the Project with the proceeds of the sale of obligations the interest upon
which is excluded from gross income for federal income tax purposes (the
"Obligations"); and
WHEREAS, prior to the issuance of the Obligations the Issuer desires to
incur certain expenditures with respect to the Project from available monies of the
Issuer which expenditures are desired to be reimbursed by the Issuer from a portion of
the proceeds of the sale of the Obligations;
NOW, THEREFORE, THE CITY COUNCIL. OF THE CITY OF SAN JUAN
CAPISTRANO DOES HEREBY RESOLVE, ORDER AND DETERMINE AS
FOLLOWS:
SECTION 1. The Issuer hereby states its intention and reasonably
expects to reimburse Project costs incurred prior to the issuance of the Obligations with
proceeds of the Obligations. Exhibit A describes either the general character, type,
purpose, and function of the Project, or the fund or account from which Project costs are
to be paid and the general functional purpose of the fund or account.
SECTION 2. The reasonably expected maximum principal amount of the
Obligations is $20,000,000, with respect to the Water System Improvements described
at Exhibit A.
SECTION 3. This resolution is being adopted on or prior to the date (the
"Expenditures Date or Dates") that the Issuer will expend monies for the portion of the
Project costs to be reimbursed from proceeds of the Obligations.
SECTION 4. Except as described below, the expected date of issue of
the Obligations will be within eighteen months of the later of the Expenditure Date or
Dates and the date the Project is placed in service; provided, the reimbursement may
not be made more than three years after the original expenditure is paid. For
1 12/7/2007
PASSED, APPROVED AND ADOPTED this 7tr' day of December 2010.
SAM ALLEVATO, MAYOR
ATTES
t �
MARIA I , CITY RK
COUNTY OF ORANGE
CITY OF SAN JUAN CAPISTRANO )
STATE OF CALIFORNIA )
I, MARIA MORRIS, appointed City Clerk of the City of San Joan Capistrano, do hereby
certify that the foregoing Resolution No, 10-12-07-03 was duly adopted by the
City Council of the City of San Juan Capistrano at a Regular meeting thereof, held the
7t" day of December 2010, by the fallowing vote:
AYE S� COUNCIL MEMBERS: Freese, Reeve, Taylor, Kramer and Mayor Allevato
NOES:. C.PUNCIL MEMBERS: None
A68EN d DUNCIL MEMBERS: None
, II
MAR S, City Cl'
3 12-7-2010
12/7/2010
AGENDA REPORT E6
TO: Joe Tait, City Manag
FROM: Cindy Russell, Chief Financial Officer/City Treasurer
SUBJECT: Consideration of Agreements for Bond Counsel and Financial Advisor
Services for the Proposed Debt Financing - Series 2011 Related to Water
System Facilities and`Reimbc M:ont Resolution for Costs; and Possible
Refunding of Certificates of Participation, Series 2002 (Stradling, Yocca,
Carlson and Rauth and Fieldman, Rolapp and Associates)
RECOMMENDATION:
By Motion,
1. Approve the Agreement with Stradling, Yocca, Carlson and Rauth for bond
counsel services for the proposed Water Facility Debt Financing - Series 2011;
and,
2. Approve the Agreement with Fieldman, Rolapp and Associates for financial
advisor services for the proposed Water. Facility Debt Financing - Series 2011;
and,
3. Authorize the City Manager to execute these agreements and any subsequent
authorization related to the refunding'..& "the Certificates of Participation, Series
2002 as needed; and,
4. Approve the reimbursement resolution authorizing eligible costs related to Water
System Improvements incurred prior to the issuance of the debt to be reimbursed
from future debt proceeds.
SITUATION:
Summary and Recommendation:
The City's Water Rate Study dated November 2009 identified a number of long-term
water supply strategies. The City Council in conjunction with recommendations from
the Utilities Commission adopted Scenario #2 - the Expanded Local Supply option and
its related financing plan. The Expanded','Local Supply Scenario embarks on the
following activities:
Agenda Report December 7, 2010
Page 2
• Groundwater Recovery Plant (GWRP) utilizes full basin rights;
• Increases recycled water imports from MNWD 1 SMWD and constructs
distribution and conversion facilities to support this action;
• Implements non-domestic recycled water wells;
• Decreases MWD imports, and
• Coordinates the basin management plan.
The Utilities department is prepared to move 'forward with the recycled water system
facilities as well as the projects outlined in the FY 10111 budget. In order to fund these
projects, this debt financing would need to move forward at this time.
.Proposed 2011 Certificates of Partioi ati6n COPS
This debt financing was anticipated as part of the City's water rate schedule effective in
February 2010. However, this water rate schedule also anticipated a water commodity
surcharge or reimbursement from Chevron to cover the financial impacts of MTBE on
the GWRP production. The current rates can barely provide the necessary coverage
for the existing and proposed debt service as well as fund the costs of MTBE treatment
or lost production from the GWRP until the GAC treatment facility is completed.
Although, a settlement in principal has been reached with Chevron, an actual settlement
agreement has not been completed. Staff and the City's consultants will begin the
review and preparation of certain financial information for the issuance of this debt at
this time. However, the City's bond counsel, financial advisor and staff are
recommending legal documents not begin preparation until the City is close to
completion of the final settlement agreement and the actual credit ratings process would
not begin until the final settlement agreement has been completed. A tentative calendar
for the issuance of this debt has been provided as Attachment 4 to this report. This
calendar will be updated regularly based on.the status of the settlement agreement
2002 Certificates of Participation COPs Refundin
Additionally, FRA has identified that based on the current rates; the City would most
likely benefit from a refunding of the 2002 COs, Based on the current projections, the
savings to be realized by the Water l�nterprise` Fund would be $1,171,035.74 over the
next ten years or a net present value (NPV) of $924,428 (See Attachment 5, page 3).
Staff will continue to review the merits of the refunding and make a final
recommendation to the City Council as part of the authorization to issue debt scheduled
for early 2011.
Debt Financing Contract Services
In order to facilitate the issuance of debt, the City needs to retain legal or bond counsel
and financial advisor services. The City and Agency have worked closely with
Stradling, Yocca, Carlson and Rauth (SYCR) and Fieldman, Rolapp and Associates in
the area of debt financing for more than twenty years and have been very impressed
with their services and expertise. These firms have been instrumental in assuring that
Agenda Report December 7, 2010
Page 3
the City and Agency information reviewed by the rating agencies achieves the best
position possible for the City/Agency. To that end, the City/Agency has received a AAA
rating on its General Obligation Bonds and a AA- on its Water Enterprise and Tax
Allocation Bonds.
These firms are very familiar with the City and would provide the most conducive
working relationship with staff to move this process forward. Additionally, these firms
have been available at any time for information relating to these issues and other
financing issues as they arise to provide support to City and Agency staff. Their debt
financing projects for the City/Agency include:
City/Non-Enterprise. Debt
1990 $ 4,955,000 General Obligation Bond Issuance (Measure D-1990) (CITY)
1991 $ 9,050,000 General Obligation Bond Issuance (Measure D-1990) (CITY)
1992 $ 6,995,000 General Obligation Bond Issuance (Measure D-1990) (CITY)
1998 $18,155,000 General Obligation: Refunding Bonds (Measure D-1990)
(C ITY)
2009 $30,000,000 General'Obligation 'Bond Issuance (Measure YW2008) (City)
Water/Wastewater Debt
2002 $ 8,525,000 Certificates of Participation — Series 2002 (Water)
(CITY/CVWD)
2002 $31,555,000 Revenue Bonds—GRWP (SJBA in conjunction with
CITY/CVWD)
2004 $23,000,000 Certificates of Participation — Series 2004 (Water) (CITY)
2009 $11,140,000 Certificates of Participation — Series 2009 (Water) (CITY)
Community Redevelopment Agency Debt
1986 $ 6,250,000 Tax Allocation Notes (CRA) (SYCR only)
1991 $ 6,250,000 Tax Allocation Refunding Bonds (CRA) (SYCR only)
1997 $ 1,800,000 Subordinated Taxable Allocation Bonds (Housing) (CRA)
1998 $ 6,315,000 Tax Allocation Refunding Bonds (GRA)
2008 $9,780,000 Tax Allocation Bonds — 2008, Series A (Non-Housing)
2008 $10,540,000 Tax Allocation Bonds --2008, Series B (Housing)
Specifically, Kurt Yeager and Carol Lew of:SYCR have provided their expertise as legal
counsel; and, Jim Fabian and Darryl Street.of Heldman, Rolapp and Associates have
provided their services in a financial advisor capacity on these issues.
The costs of these contract services do not vary greatly from firm to firm, therefore
adherence to a Request for Proposal (RFP) process would not necessarily produce the.
most economically feasible result. These costs are also at or below the costs for 2002
debt financing as a percentage of the total debt issued. Additionally, the City would
save the cost of staff time associated with a formal RFP process, and staff would be
Agenda Report December 7, 2010
Page 4
able to move this process along as rapidly as possible. Therefore, staff' is
recommending the two firms that have worked with the City on a number of debt issues
including our Open Space bonds, Community Redevelopment Agency bonds; Housing
bonds; and our previous Certificates of.Participation and Revenue Bonds for Water
Facility purposes.
COMMISSION/BOARD REVIEW AND RECOMMENDATIONS:
The Utilities Commission approved the FY 2010/2011 budget document, which included
the $18 million in debt proceeds for construction to be issued in support of the Domestic
and Recycled Water projects.
FINANCIAL. CONSIDERATIONS:
The cost for legal counsel services, $87,365 and the cost of the independent financial
advisor services, $52,500 including expenses for a competitive sale have been included
in the cost of issuance calculations for determining the sizing of the debt. Based on the
projected sources and uses of funds, the size of the new debt issue is estimated at
approximately $19.365 million as outlined in Attachment 5 to this report. These are
projections only and updated projections will,be provided for City Council along with the
authorization to issue this debt. Payment :for all services rendered and expenses
incurred in conjunction with the Agreements would be paid along with other costs of
issuance from debt proceeds at time of .issuance. In the event of abandonment of the
project, the City would be required to pay a :fee equal to the reasonable value of
services rendered from the date of the agreement to the date of abandonment.
If the City decides to move forward with the 2002 refunding, then additional costs for
bond counsel and financial advisors services would be $4,825 and $8,000, respectively.
The option to include or excluded these service is included in the attached contract and
can be authorized by the Chief Financial Officer/City Treasurer or City Manager.
NOTIFICATION:
Stradling, Yocca, Carlson and Rauth*
Fieldman, Rolapp and Associates`
Agenda Report December 7, 2010
Page 5
RECOMMENDATION:
By Motion,
1. Approve the Agreement with Stradling, Yocca, Carlson and Rauth for bond
counsel services for the proposed Water Facility Debt Financing - Series 2011;
.and,
2. Approve the Agreement with Fiel.dm.an . Rolapp and Associates for financial
advisor services for the proposed Water Facility Debt Financing - Series 2011;
and,
3. Authorize the City Manager to execute these agreements and any subsequent
authorization related to the refunding of the Certificates of Participation, Series
2002 as needed; and,
4. Approve the reimbursement resolution authorizing eligible costs related to
Domestic and Recycled Water Capital Improvements incurred prior to the
issuance of the debt to be reimbursed from future debt proceeds.
Respectfully Submitted,
i ndy Ruj ell
Chief Financial Officer/City Treasurer
Attachments:
1. Agreement for Bond Counsel.Services With:Stradling, Yocca, Carlson & Rauth.
2. Agreement for Financial Advisory Services with Fieldman, Rolapp & Associates.
3. Reimbursement Resolution
4. SJC PFA - Certificates of Participation, Series 2011 Calendar (preliminary draft)
5. SJC PFA - Certificates of Participation, Series 2011 and Potential 2002 Refunding
Sources and Uses of Funds (preliminary estimates)
PERSONAL SERVICES AGREEMENT
THIS AGREEMENT is made and entered into this 15t day of December, 2010 by and
between the City of San Juan Capistrano, hereinafter referred to as "City," and Stradling,
Yocca, Carlson & Rauth, a Professional Corporation hereinafter referred to as "Consultant."
RECITALS:
WHEREAS, City requires professional consulting services for legal matters in
connection with the execution and delivery of certificates of participation to fund the
acquisition and construction of certain public water improvements described as follows.
2011 Water Revenue Certificates of Participation (for convenience of reference the
"Certificates"); and
WHEREAS, City desires to retain Consultant to do the necessary legal work
hereinafter outlined, upon the terms and conditions hereinafter set forth, for financing the
acquisition and construction of said facilities, and
WHEREAS, Consultant represents that it is ready, willing and able to perform said
legal work;
NOW, THEREFORE, City and Consultant, for the consideration hereinafter named,
agree as follows:
SECTION 1. GENERAL,
The considerations of work on the project shall be governed by the conditions
contained herein. In general, the tasks delineated herein are to be performed with minimum
direction and assistance from City.
All work performed by Consultant, however, shall be subject to review and approval
of the City by its City Manager or its designee'at'all times.
SECTION 2. ,SCOPE OF TASKS BY CONSULTANT.
Subject to the terms and conditions of this Agreement, Consultant shall perform the
tasks as set forth in Exhibit A, attached and incorporated herein by reference.
During performance of the above tasks, Consultant shall have access to existing
data in City files, and City shall provide copies of any such data Consultant requests at no
cost to Consultant.
SECTION 3. TIME OF BEGINNING AND COMPLETION OF SERVICES;
The services provided under this Agreement shall begin upon execution of this
Agreement by all parties. The services provided under this Agreement shall be completed
on or before certificates are closed or the project is abandoned, whichever occurs first.
DOCSOCI1449963Y110226 8-€028
SECTION 4. PAYMENT FOR CONSULT41NIT'S SERVICES.
Consultant contract billings may be submitted on the consultant's forms and, at a
minimum, should contain the following:
Title of project(s)
Purchase order number
Total approved purchase order amount
Amount paid to date
Amount requested
Amount remaining on purchase order
Breakdown of amounts by project type or account number
Bills for bond counsel services shall be submitted at the closing of the Certificates for
immediate payment through the Certificate Trustee subject to approval of invoice by the
City.
Payment shall be made pursuant to Exhibit A attached hereto.
SECTION 5. COVENANT AGAINST CONTINGENT FEES.
Consultant warrants that:'Stradling, Yoeca, Carlson & Rauth has not employed or
retained any company or person, other than a bona fide employee working for Consultant,
to solicit or secure this Agreement, that Stradling, Yocca, Carlson & Rauth has not paid or
agreed to pay any company or person, other than a bona fide employee, any fee,
commission, percentage, brokerage fee, gift or any other consideration, contingent upon or
resulting from the award or making of this Agreement. For breach or violation of this
warranty, City shall have the right to annul this Agreement without liability, or, at its sole
discretion, to deduct from the Agreement price or consideration, or otherwise recover the
full amount of such fee, commission, percentage, brokerage fee, gift or contingent fee.
SECTION 6. EXPENSES,
Consultant acknowledges City is under no obligation to compensate Consultant for
services rendered or expenses accrued under this Agreement in excess of the maximum
compensation specified in Section 4.
SECTION 7. OWNERSHIP OF DOCUMENTS.
All tracings, plans, specifications, maps. or. other documents prepared or obtained
under the terms of this Agreement shall be, delivered to, and become the property of City,
and basic survey notes and sketches, charts; computations and other data prepared or
obtained under this Agreement shall be made available upon request to City without
restriction or limitation on their use.
SECTION 6. CONFLICT OF INTEREST.
The designs, plans, reports, investigation, Materials and documents prepared or
acquired by Consultant pursuant to this Agreement (including any duplicate copies kept by
Consultant) shall not be shown to any other public or private person or entity, except as
z
DOCSOCI1449963v]1022658-0028
authorized by City. Consultant shall not disclose to any other public or private person or
entity any information regarding the activities of City, except as authorized by City.
SECTION 9. CONFLICT OF INTEREST.
For the duration of this Agreement, Consultant shall not act as consultant or perform
services of any kind for any person or entity in. regard to this project without the prior written
consent of City.
SECTION 10. CHANGES IN SCOPE OF CONSULTANT'S SERVICES.
No additional fee shall be paid by City for additional consultant services not included
in this Agreement without the written approval of the City prior to undertaking such work. In
the event of suspension of project by City, Consultant shall have the right to renegotiate
fees if delay is greater than six (6) months.
SECTION 11. TERMINATION.
City may, without cause, terminate this Agreement at any time prior to completion by
Consultant of any of the services required hereunder. Notice of termination of this
Agreement shall be given in writing to Consultant, and shall be sufficient to complete when
same is deposited in the U.S. mail, first class`postage prepaid.
In the event this Agreement is terminated by City, Consultant shall be paid the value
of services performed by it pursuant to this Agreement prior to the date of termination
thereof, such value to be the total to which it shall have become entitled, as determined by
the City, less the amount of any payments previously made, but in no event exceeding the
maximum contract amount stated in lection 4`'
SECTION 12. DISPUTES.
Unless otherwise specified herein, any dispute over a question of fact arising under
this Agreement which cannot be resolved by agreement between the parties may be, by
mutual consent of the parties, submitted to a "Board of Arbitration" consisting of three (3)
arbitrators having expertise relating to this contract subject matter, one of whom shall be
selected by each of the parties, and the third by the two members selected by the parties.
Each of the parties shall pay the member selected by it, and the compensation of the
third member shall be paid equally by the parties. The parties shall be bound by the
decision of the Board of Arbitration.
SECTION 13. NO ASSIGNMENTS.
Neither any part nor all of this Agreement may be assigned or subcontracted, except
as otherwise specifically provided herein, or to which City, in its sole discretion, consents to
in advance thereof in writing. Any assignment or subcontracting in violation of this provision
shall be void.
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DOCSOC/14 49963 v i/022658-0028
SECTION 14. ENDORSEMENT ON PLANS, ETC.
Consultant shall endorse all plans, data and other documentation submitted to City
pursuant to this.Agreement.
SECTION 15. MAINTENANCE OF RECORDS.
Consultant shall maintain all books, documents, papers, employee time sheets,
accounting records and other evidence pertaining to costs incurred and shall make such
materials available at their respective offices at all reasonable times during the contract
period and for three (3) years from the date of final payment under this Agreement for
inspection by City, and copies thereof shall be furnished if requested.
SECTION 16. INDEPENDENT CONTRACTOR.
At all times during the term of this Agreement, Consultant shall be an independent
contractor and shall not be an employee of the City. City shall have the right to control
Consultant only insofar as the results of Consultant's services rendered pursuant to this
Agreement; however, City shall not have the right to control the means by which Consultant
accomplishes services rendered pursuant to this Agreement.
All persons employed to provide services under this Agreement shall be employees
or contractors of Consultant and shall not be deemed employees of City for any reason or
purpose. Consultant shall be responsible for providing worker's compensation insurance
coverage for all persons employed to perform services under this Agreement.
SECTION 17. INDEMNITY.
Consultant maintains as of the date hereof, and shall continue to maintain
throughout the term of this Agreement, a policy of professional liability insurance which
insures Consultant against claims which it is legally obligated to pay, in a maximum policy
amount of no less than $25,000,000. No indemnity is provided by Consultant to City, but
rather Consultant agrees to maintain the ..foregoing insurance throughout the term of
Consultant's engagement with respect to,t:fe project described herein.
SECTION 18. INSURANCE REQUIREMENTS.
1) Comprehensive General Liability. ' Consultant shall maintain in full force and
effect comprehensive general liability coverage, including premises operations,
products/completed operations, broad form property damage and blanket contractual
liability in the fallowing minimum amounts:
$500,000 property damage;
$500,000 injury to one person/any one occurrence/not limited to contractual
period;
$1,000,000 injury to more than one person/any one occurrence/not limited to
contractual period.
4 .`
DOCSOG 1449963 v 1/022658-0028
2) Comprehensive Automobile Liability. Consultant shall maintain in full force
and effect comprehensive automobile liability coverage, including owned, hired and non-
owned vehicles in the following minimum amounts;
$500,000 property damage;
$500,000 injury to one person/anyone occurrence/not limited to contractual
period,
$1,000,000 injury to more than one personlany one occurrence/not limited to
contractual period.
3) Errors and Omissions Coverage. Consultant shall maintain in full force and
effect professional errors and omissions coverage in a minimum amount of$500,000.
4) Worker's Compensation, If Consultant employs employees to perform
services under this Agreement, Consultant shall obtain and maintain, during the life of this
Agreement, Worker's Compensation Employer's Liability Insurance in the statutory amount
as required by state law.
These policies shall not terminate, nor shall they be cancelled nor the coverage
reduced until after 30 days' written notice is given to the City.
Prior to beginning work, Consultant shall provide to City certificates of insurance
establishing that the required insurance coverages have been secured by Consultant.
Consultant shall provide an endorsement to City establishing that City has been legally
added as an additional insured to the insurance policies required under this Agreement.
SECTION 19. TIME FOR SUBMITTING PROOF OF INSURANCE.
Consultant shall submit proof of insurance requirements under this Agreement to the
City Clerk's office prior to beginning any work under this Agreement.
Consultant shall not receive any compensation until all insurance provisions have
been satisfied.
SECTION 20. LICENSES PERMITS ETC.
Consultant represents and warrants: to City that it has all licenses, permits,
qualifications and approvals of whatever nature that are legally required to practice its
profession. Consultant represents and warrants to City that Consultant shall, at its sole cost
and expense, keep in effect at all times during the term of this Agreement, any license,
permit or approval which is legally required for Consultant to practice its profession.
SECTION 21. CONSULTANT NOT AN AGENT.
Except as City may specify in writing, Consultant shall have no authority, express or
implied, to act on behalf of the City in any capacity as an agent. Consultant shall have no
authority, express or implied, pursuant to this Agreement, to bind City to any obligation.
s
DOCSOC11449963v 11022658-0028
SECTION 22. PERSONNEL.
Consultant agrees to assign the following 'person/persons to perform the tasks set
forth in the Agreement: E. Kurt Yeager and Carol L. Lew.
Consultant shall not unilaterally alter fh'e iagsignment of the above personnel without
the authorization of the City.
City shall have the unrestricted right to order the removal of any person/persons
assigned by Consultant by giving oral or written notice to Consultant to such effect.
SECTION 23. NONDISCLOSURE REQUIREMENTS/CONFLICTS OF INTEREST.
Pursuant to Council policy, it has been determined that the services to be rendered
under the provisions of this Agreement are excluded by the requirement of filing a Financial
Disclosure Statement by California Administrative Code Section 18700(2)(A) and (B).
Consultant certifies that to the best of its knowledge, no City or City employee or
office of any public agency interest in this Agreement has any pecuniary interest in the
business of Consultant and that no person associated with Consultant has any interest that
would conflict in any manner or degree with the performance of this Agreement. Consultant
represents that, other than representation by Consultant from time to time of underwriting
firms which may purchase the Certificates, it presently has no interest and shall not acquire
any interest, direct or indirect, which could conflict in any manner or degree with the faithful
performance of this Agreement. Consultant is familiar with the provisions of Government
Code Section 87100 and following, and it certifies that it does not know of any fact which
constitute a violation of said provisions. Consultant'will advise the City if a conflict arise.
SECTION 24. NOTICE.
All notices shall be personally delivered or mailed to the below listed addresses, or
to such other addresses as may be designated by written notice. These addresses shall be
used for delivery of service of process:
To City: City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attn: Cindy Russell, Chief Financial Officer/City Treasurer
To Consultant: Stradling, Yocca, Carlson and Rauth
660 Newport Center Drive, Suite 1600
Newport Beach, CA 92660
Attn: Kurt Yeager
6
DOCS001449963v 1/022658-0028
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first hereinabove written.
CITY OF SAN JUAN CAPISTRANO
By:
STRADLING, YOCCA, CARLSON & RAUTH, A
PROFESSIONAL CORPORATION,
CONSULTANT
By:
ATTEST:
APPROVED AS TO FORM:
City Attorney
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DOCSOCI1449963v1/022658-0028
EXHIBIT A
SCOPE OF WORK
1. SERVICES
The City retains Consultant to provide, and Consultant agrees to provide,
legal services in connection with the execution and delivery of certificates (hereinafter
referred to as the "Certificates") to finance certain water and sewer projects. Such services
will be divided into two phases: (a) development of a financing plan; and (b) implementation
of the financing plan.
In the first phase -- the planning stage -- we would expect:
(i) to research applicable laws including federal and state tax laws,
securities laws and other laws that may be applicable to the financing
structure currently proposed;
(ii) to attend conferences and consult with the City/City staff (including the
City Finance Director and counsel) regarding such laws, to participate
with any financial advisors, underwriters, developers, lenders and
other experts retained by the City in structuring the financing; and
(iii) to consult with other firm active in the bond practice when necessary
to ensure that any novel approaches being considered would be
generally accepted in the bond community.
In the second phase -- the implementation stage --'we would expect:
(i) to supervise and prepare documentation of all steps to be taken
through the execution and delivery of the Certificates including:
a. drafting all resolutions of the City and all other basic documents
relating to the:security of the Certificates, in consultation with
the City, its counsel and financial advisors, underwriters and
other experts;
b. preparing: the'reco;rd of proceedings for the authorization, sale
and delivery of the Certificates;
C. preparing 'documents relating to the financing, including the
indenture and related resolutions;
d. preparing the official statement or placement memorandum for
the Certificates;
e. reviewing the Bond purchase contracts or the bidding
documents and participating in the related negotiations;
A-]
DOCS OC/1 X149963 v i/622555-64328
f. attending information meetings and other conferences
scheduled by the City, the financial advisors or the
underwriters;
g1 consulting with counsel to the City concerning any legislation or
litigation during the course of the financing;
h. consulting with the trustee and counsel to the trustee;
i. preparing the form of the Certificates, and supervising their
production or printing, signing, authentication and delivery; and
j. rendering any necessary collateral legal opinions as to the
inapplicability of the registration requirements of federal
securities laws and other matters related to the execution and
delivery of the Certificates and City authority with respect to the
financing generally.
(ii) to render a final legal opinion pertaining to the Certificates to the effect
that:
a. the Certificates have been properly authorized and issued and
are valid and binding obligations;
b. the essentialsources of security for the Certificates have been
legally provided, and , .
C. all interest with respect to the Certificates is excludable from
gross income for federal income tax purposes and exempt from
California personal income taxation, as applicable.
2. INDIVIDUAL RESPONSIBLE FOR PROVIDING SERVICES
The City agrees to accept and Consultant agrees to provide the aforementioned
services through E. Kurt Yeager, Brian Forbath and Carol L. Lew.
Should the above attorneys be unable to provide such services due to death,
disability, or similar event, Consultant reserves the right to substitute, with City's consent,
another of its attorneys to provide such services, and such substitution shall not alter or
affect in any way Consultant's other obligations under this agreement.
A-2
DOCSOCA449963v1/0226 8-0028
3. BOND FEE
Basic Bond Counsel Fee: The fee for the services described in this Agreement shall
be based upon the total principal amount of Certificates authorized and sold and will be
computed in accordance with the following schedule:
Principal Amount of Certificates Fee
$1,000,000 or less $25,000
$1,000,001 to $5,000,000 $25,000 plus 1/4 of 1% of the
excess over $1,000,000
$5,000,001 or more $38,000 plus 1110 of 1% of the
excess over $5,000,000, in no
event to exceed $58,000
Additionally, for the service of preparing the Official Statement for the Certificates,
the City agrees to pay Bond Counsel for each issue of Certificates a fee of$35,000. Except
as provided in Section 4 below, Consultant fees are to be billed upon the execution and
delivery of the Certificates and will be payable from Bond proceeds. In the event a
refunding of obligations other than the 2002 Certificates is included, the cap described
above will not apply.
Out-of-Pocket Expenses: In addition to the Basic Fee, Bond Counsel shall be
reimbursed for out-of-pocket expenses incurred'pursuant to this Agreement and hourly fees
incurred pursuant to Section 4 of the Agreement.
Payment of the Basic Bond Counsel Fee and Out-of-Pocket Expenses is entirely
contingent upon the successful sale of the Certificates, and payment thereof is to be made
from the proceeds of the Certificates. ,
4. FOLLOW-UP SERVICES
Bond counsel agrees to provide without additional cost normal follow-up consultation
and related services following the sale of the Certificates. Should the City require
Consultant to provide extraordinary services after the sale of the Certificates, such services
shall be provided at an additional fee to be agreed upon at a later date.
A-3
DOCSOCI1449963 11(}22658-0028
PERSONAL SERVICES AGREEMENT
THIS AGREEMENT is made, entered into, and shall become effective this 71"
day of December, 2010, by and between the City of San Juan Capistrano (hereinafter
referred to as the '.'City") and Fieldman, Rolapp and Associates (hereinafter referred to
as the "Consultant").
RECITALS:
WHEREAS, City desires to retain independent financial advisory service in
connection with the execution and delivery of certificates of participation to fund the
acquisition and construction of certain public water improvements described as follows:
2011 Water Revenue Certificates of Participation (for convenience of reference the
"Certificates"); and
WHEREAS, City desires to retain professional and technical services of the
Consultant for the purposes of debt issuance related to the financing the acquisition and
construction of said facilities.
WHEREAS, Consultant is qualified by virtue of experience, training, education
and expertise to accomplish such services
NOW, THEREFORE, City and Consultant mutually agree as follows:
Section 1. Scope of Work.
The scope of work to be performed by Consultant shall consist of those tasks as
set forth in Exhibit 'A," attached and incorporated herein by reference. To the extent
that there are any conflicts between the provisions described in Exhibit "A" and those
provisions contained within this Agreement, the provisions in this Agreement shall
control.
Section 2. Terre.
The services provided under this agreement shall commence upon execution of
Agreement by all parties. The services provided under this Agreement shall be
completed on or before certificates are closed or the project is abandoned, whichever
occurs first.
Section 3. Compensation.
3.1 Amount.
Consultant contract billings may be submitted on the consultant's forms
and, at a minimum, should contain the following:
1
ATTACHMENT 2
Title of project(s)
Total approved contract amount
Amount paid to date
Amount requested
Amount remaining on contract
Breakdown of amounts by project type or account number
Three copies of itemized bills, clearly indicating the monthly period for which the
billing is made, shall be submitted to: The City of San Juan Capistrano, Attention: Chief
Financial Officer, 32400 Paseo Adelanto, San Juan Capistrano, California 92675.
Total compensation for the services hereunder shall not exceed $40,500 plus a
not to exceed cap of$3,500 for expenses set forth in Exhibit B.
3.2 Method of Payment.
Subject to Section 3.1, Consultant shall be compensated pursuant to
Exhibit A, Section 3 and Exhibit B and Consultant's fee shall be contingent and payable
at the closing of the debt issue.
3.3 Records of Expenses.
Consultant shall keep complete and accurate records of all costs and
expenses incidental to services covered by this Agreement. These records will be
made available at reasonable times'to City.r. ;
Section 4. Independent Contractor.
It is agreed that Consultant shall aci and be an independent contractor and not
an agent or employee of City, and shall obtain no rights to any benefits which accrue to
City's employees.
Section 5. Limitations Upon Subcontracting and Assignment.
The experience, knowledge, capability and reputation of Consultant, its principals
and employees were a substantial inducement for City to enter into this Agreement.
Consultant shall not contract with any other, entity to perform the services required
without written approval of the City. This Agreement may not be assigned, voluntarily or
by operation of law, without the prior written approval of the City. if Consultant is
permitted to subcontract any part of this Agreement by City, Consultant shall be
responsible to City for the acts and omissions of its subcontractor as it is for persons
directly employed. Nothing contained in, this Agreement shall create any contractual
relationships between any subcontractor and City. All persons engaged in the work will
be considered employees of Consultant. Cit will deal directly with and will make all
payments to Consultant.
2
Section 6. Changes to Scope of Work.
For extra work not part of this Agreement, a written authorization from City is
required prior to Consultant undertaking any extra work. In the event of a change in the
Scope of Work provided for in the contract documents as requested by the City, the
Parties hereto shall execute an addendum to this Agreement setting forth with
particularity all terms of the new agreement, including but not limited to any additional
Consultant's fees.
Section 7. Familiarity with Work and/or Construction ,Site.
By executing this Agreement, Consultant warrants that: (1) it has investigated
the work to be performed; (2) if applicable,.it has investigated the work site(s), and is
aware of all conditions there; and (3) it understands the facilities, difficulties and
restrictions of the work to be performed under this Agreement. Should Consultant
discover any latent or unknown conditions materially differing from those inherent in the
work or as represented by City, it shall immediately inform the City of this and shall not
proceed with further work under this Agreement until written instructions are received
from the City.
Section 8. Time of Essence.
Time is of the essence in the performance of this Agreement.
Section 9. Compliance with Lav; E-Verify.
9.1. Compliance with Law.
Consultant shall comply with all . applicable laws, ordinances, codes and
regulations of federal, state and local government.
9.2. E-Verify.
If Consultant is not already enrolled in the U.S. Department of Homeland
Security's E-Verify program, Consultant shall enroll in the E-Verify program within fifteen
days of the effective date of this Agreement to verify the employment authorization of
new employees assigned to perform work hereunder. Consultant shall verify
employment authorization within three days of hiring a new employee to perform work
under this Agreement. Information pertaining to the E-Verify program can be found at
http://www.uscis.gy, or access the registration page at https://www.vis-
dhs.com/employerregistration. Consultant shall certify its registration with E-Verify and
provide its registration number within sixteen days of the effective date of this
Agreement. Failure to provide certification will result in withholding payment until full
compliance is demonstrated.
3
Section 10. Conflicts of interest..
Consultant covenants that it presently has no interest and shall not acquire any
interest, direct or indirect, which would conflict in any manner or degree with the
performance of the services contemplated by this Agreement. No person having such
interest shall be employed by or associated with Consultant,
Section 11. Copies of Work Product.
At the completion of the work, Consultant shall have delivered to City at least one
(1) copy of any final reports and/or notes or drawings containing Consultant's findings,
conclusions, and recommendations with any supporting documentation. All reports
submitted to the City shall be in reproducible format, or in the format otherwise
approved by the City in writing.
Section 12. Ownership of Documents.
All reports, information, data and exhibits prepared or assembled by Consultant
in connection with the performance of its services pursuant to this Agreement are
confidential to the extent permitted bylaw, and Consultant agrees that they shall not be
made available to any individual or organization without prior written consent of the City.
All such reports, information, data, and. exhibits shall be the property of the City and
shall be delivered to the City upon demand without additional costs or expense to the
City. The. City acknowledges such documents are instruments of Consultant's
professional services.
Section 13. Indemnity.
To the fullest extent permitted by law, Consultant agrees to protect, defend, and
bold harmless the City and its elective and appointive boards, officers, agents, and
employees from any and all claims, liabilities, expenses, or damages of any nature,
including attorneys' fees, for injury or death of any person, or damages of any nature,
including interference with use of property, arising out of, or in any way connected with
the negligence, recklessness and/or intentional wrongful conduct of Consultant,
Consultant's agents, officers, employees, subcontractors, or independent contractors
hired by Consultant in the performance of the Agreement. The only exception to
Consultant's responsibility to protect, defend, and hold harmless the City, is due to the
negligence, recklessness and/or.wrongful conduct of the City, or any of its elective or
.appointive boards, officers, agents, or employees.
This hold harmless agreement shall apply to all liability regardless of whether any
insurance policies are applicable. The policy limits do not act as a limitation upon the
amount of indemnification to be provided by Consultant.
4
Section 14. Insurance.
On or before beginning any of the services or work called for by any term of this
Agreement, Consultant, at its own cost .and,, expense, shall carry, maintain for the
duration of the agreement, and provide proof,thereof that is acceptable to the City, the
insurance specified below with insurers and under forms of insurance satisfactory in all
respects to the City. Consultant-shall not allow any subcontractor to commence work
on any subcontract until all insurance required of the Consultant has also been obtained
for the subcontractor. Insurance required herein shall be provided by Insurers in good
standing with the State of California and having a minimum Best's Guide Rating of A-
Class VII or better.
14.1 Comprehensive General Liability.
Throughout the term of this Agreement, Consultant shall maintain in full
force and effect Comprehensive General Liability coverage in an amount not less than
one million dollars per occurrence ($1,000,000.00), combined single limit coverage for
risks associated with the work contemplated by this agreement. If a Commercial
General Liability Insurance form or other form with a general aggregate limit is used,
either the general aggregate limit shall apply separately to the work to be performed
under this agreement or the general aggregate limit shall be at least twice the required
occurrence limit.
14.2 Comprehensive Autoobi'16 Liability..
Throughout the term of this Agreement, Consultant shall maintain in full
force and effect Comprehensive Automobile .Liability coverage, including owned, hired
and non--owned vehicles in an amount not less than one million dollars per occurrence
($1,000,000.00).
14.3 Worker's Compensation.
If Consultant intends to employ employees to perform services under this
Agreement, Consultant shall obtain and maintain, during the term of this Agreement,
Worker's Compensation Employer's Liability Insurance in the statutory amount as
required by state law.
14.4 Proof of Insurance Requirements/Endorsement.
Prior to beginning any work under this Agreement, Consultant shall submit
the insurance certificates, including the deductible or self-retention amount, and an
additional insured endorsement naming City, its officers, employees, agents, and
volunteers as additional insureds as respects each of the following: Liability arising out
of activities performed by or on behalf of Consultant, including the insured's general
supervision of Consultant; products and. completed operations of Consultant; premises
owned, occupied or used by Consultant; or automobiles owned, leased, hired, or
5
borrowed by Consultant. The coverage shall contain no special limitations on the scope
of protection afforded City, its officers, employees, agents, or volunteers.
14.5 Errors and Omissions Coverage [FOR PROFESSIONSIWORK
EXCLUDED FROM GENERAL LIABILITY]
Throughout the term of this Agreement, Consultant shall maintain Errors
and Omissions Coverage (professional liability.coverage) in an amount of not less than
One Million Dollars ($1,000,000). Prior to beginning any work under this Agreement,
Consultant shall submit an Insurance certificate to the City's General Counsel for
certification that the insurance requiremen#s,'of this Agreement have been satisfied.
14.6 Notice of Cancellation/Termination of Insurance.
The above policy/policies shall not terminate, nor shall they be cancelled,
nor the coverages reduced, until after thirty (30) days' written notice is given to City,
except that ten (10) days' notice shall be given if there is a cancellation due to failure to
pay a premium.
14.7 Terms of Compensation.
Consultant shall not receive any compensation until all insurance
provisions have been satisfied.
14.8 Notice to Proceed.
Consultant shall not proceed with any work under this Agreement until the
City has issued a written "Notice to Proceed" 'verifying that Consultant has complied
with all insurance requirements of this Agreement.
Section 15. Termination:
City shall have the right to terminate this Agreement without cause by giving
thirty (30) days' advance written notice of termination to Consultant.
In addition, this Agreement may be terminated by any party for cause by
providing ten (10) days' notice to the other party of a material breach of contract. If the
other party does not cure the breach of contract, then the agreement may be terminated
subsequent to the ten (10) day cure period.
Section 16. [Notice.
All notices shall be personally delivered or mailed to the below listed addresses,
or to such other addresses as may be designated by written notice. These addresses
shall be used for delivery of service of process:
To City: City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attn: Cindy Russell, Chief Financial Officer/City Treasurer
To Consultant: Fieldman; Rolapp and.Associates
19900 MacArthur Blvd., Suite 1100
Irvine, CA 92612
Attn: James Fabian
Section 17. Attorneys' Fees.
If any action at law or in equity is necessary to enforce or interpret the terms of
this Agreement, the prevailing party shall be entitled to reasonable attorneys' fees, costs
and necessary disbursements in addition to any other relief to which he may be entitled.
Section 18. Dispute Resolution.
In the event of a dispute arising between the parties regarding performance or
interpretation of this Agreement, the dispute shall be resolved by binding arbitration
under the auspices of the Judicial Arbitration and Mediation Service ("JAMS").
Section 19. Entire Agreement.
This Agreement constitutes the entire understanding and agreement between the
parties and supersedes all previous negotiations between them pertaining to the subject
matter thereof.
7
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
CITY OF SAN JUAN CAPISTRANO
By:
Joe Tait, City Manager
CONSULTANT
BY
�
ATTEST:
City Clerk
APPROVED AS TO FORM:
I
City Attome
8
EXHIBIT A
TO
PROFESSIONAL SERVICES AGREEMENT FOR FINANCIAL ADVISOR
BY AND BETWEEN
THE CITY OF SAN JUAN CAPISTRANO
AND
FIE"LDMAN,ROLAPP & ASSOCIATES
Scope of Services
A. General Services.
The Consultant shall perform all the duties and services specifically set forth herein and shall
provide such other services as it deems necessary or advisable, or are reasonable and necessary to
accomplish the intent of this Agreement in a manner consistent with the standards and practice of
professional financial advisor's prevailing at the time such services are rendered to the City.
The City may, with the concurrence of Consultant, expand this Agreement to include any
additional services not specifically identified within the terms of this Agreement. Any additional
services may be described in an addendum to this Exhibit A and are subject to fees described in
Exhibit B to this Agreement.
B. Debt Issuance Services.
The Consultant shall assume primary responsibility for assisting the City in coordinating the
planning and execution of each debt issue relating to the Project. Insofar as the Consultant is
providing Services which are rendered only to the City, the overall coordination of the financing
shall be such as to minimize the costs of the transaction coincident with maximizing the City's
financing flexibility and capital market access. The Consultant's proposed debt issuance Services
may include, but shall not be limited to, the following:
• Establish the Financing Objectives
Develop the Financing Schedule
• Monitor the Transaction Process
• Review the Official Statement, both preliminary and final
• Procure and Coordinate Additional Service Providers
® Provide Financial Advice to the City Relating to Financing Documents
• Compute Sizing and Design Structure of the Debt Issue
• Plan and Schedule Rating Agency Presentation and.Investor Briefings
• Conduct Credit Enhancement Procurement and.Evaluation
• Conduct Market Analysis and Evaluate Timing of Market Entry
Recommend Award of Debt issuance
• Provide Pre-Closing and Closing Assistance
CITY OF SAN JUAN CAPISTRANO/FIEI.,DMAN,ROLAPP&ASSOCIATES Exhibit A, Page I
Specifically,Consultant will:
1. Establish the Financing Objectives.
At the onset of the financing transaction process for the Project, the Consultant shall
review the City's financing needs and in conjunction with the City's management, outline
the objectives of the financing transaction to be undertaken and its proposed form.
Unless previously determined, Consultant shall recommend the method of sale of debt
and outline the steps required to achieve efficient market access.
2. Develop the Financing Timetable.
The Consultant shall take the lead role in preparing a schedule and detailed description of
the interconnected responsibilities of each team member and update this schedule, with
refinements, as necessary, as the work progresses.
3. Monitor the Transaction Process.
The Consultant shall have primary responsibility for the successful implementation of the
financing strategy and timetable that is adopted for each debt issue relating to the Project.
The Consultant shall coordinate (and assist, where appropriate) in the preparation of the
legal and disclosure documents and shall monitor the progress of all activities leading to
the sale of debt. The Consultant shall prepare the timetables and work schedules
necessary to achieve this end in a timely, efficient and cost-effective manner and will
coordinate and monitor the activities of all parties engaged in the financing transaction.
4. Review the Official Statement.
a. Generally, SEC, MSRB, and GFOA guidelines encourage full disclosure so
that potential investors have sufficient data to analyze each proposed
financing. Upon direction of the City, the Consultant shall take the lead in
review of the official statement for each debt issue relating to the Project to
insure that the City's official statement is compiled in a manner consistent
with industry standards, typically including the following matters:
• Legal Authority for the Financing
® Security for the Financing
® Restrictions on Additional Financings
® Purpose and Funds for which the Financing is Being Issued
Governmental System
p Financial Management System
a Revenue Sources: Historic, Current and Projected
• Outstanding Financings
Planned Future Financings
Labor Relations and Retirement Systems
® Economic Base
0 Annual Financial Statements
® Legal Opinions Regarding Tax Exemption
® Such Other Matters as the Context May Require.
CITY OF SAN JUAN CAPISTRANO/FTELDMAN, ROLAPP&ASSOCIATES Exhibit A, Page 2
b. The Consultant shall maintain and update the official statement on its word
processing system until such time as it is near final and suitable for transfer
to the financial printer, in order to ininimize the costs of revisions made by
the printer.
5. Procure and Coordinate Additional Service Providers.
Should the City desire, the Consultant may act as City's representative in procuring the
services of financial printers for the official statement and related documents, and for the
printing of any securities. In addition, the Consultant may act as the City's representative
in procuring the services of trustees, paying agents, fiscal agents, feasibility consultants,
redevelopment consultants, or escrow verification agents or other professionals, if the
City directs.
6. Provide Financial.Advice to the City Relating to Financing Documents.
Simultaneous with assisting in the preparation of official. statements for each debt issue
relating to the Project, the Consultant shall assist the managing underwriters, bond
counsel and/or other legal advisors in the drafting of the respective financing resolutions,
notices and other legal documents. In this regard, the Consultant shall monitor document
preparation for a consistent and accurate presentation of the recommended business terms
and financing structure of each debt issue relating to the Project, it being specifically
understood however that the Consultant's services shall in no manner be construed as the
Consultant engaging in the practice of law.
7. Com ute Sizing and Design Structure of Debt Issue.
The Consultant shall work with the City's staff to design a financing structure for each
debt issue relating to the Project that is consistent with the City's objectives, that
coordinates each transaction with outstanding issues and that reflects current conditions
in the capital markets.
8. Plan and Schedule Rating Agency Presentation and.Investor Briefiu
The Consultant shall develop a plan for presenting the financing program to the rating
agencies and the investor community. The Consultant shall schedule rating agency visits,
if appropriate, to assure the appropriate and most knowledgeable rating agency personnel
are available for the presentation and will develop presentation materials and assist the
City officials in preparing for the presentations.
9. Conduct Credit Enhancement Evaluation and Procurement.
Upon the City's direction, the Consultant will initiate discussions with bond insurers,
letter of credit providers and vendors of other forms of credit enhancements to deterrrmi:ne
the availability of and cost benefit of securing financing credit support.
CITY OF SAN JUAN CAPISTRANOIFIELDMAN,ROLAPP&ASSOCIATES Exhibit A, Page 3
10. Conduct Market Analysis and Evaluate Timing of Market Entry.
The Consultant shall provide regular summaries of current municipal market conditions,
trends in the market and how these may favorably or unfavorably affect the City's
proposed financing.
Competitive Sales.
For all types of competitive sale of debt, the Consultant shall undertake such
activities as are generally required for sale of securities by competitive bid
including, but not limited to the following:
Review and comment on terms of Notice of Sale Inviting Bids
® Provide advice on debt sale scheduling
Provide advice on the use of electronic bidding systems
Coordinate bid opening with the City officials
• Verify bids received and make recommendations for acceptance
Provide confirmation of issue sizing, based upon actual bids received,
where appropriate
• Coordinate closing arrangements with the successful bidder(s)
11. Recommend Award of Debt Issuance.
Based upon activities outlined in task above, the Consultant will recommend
accepting or rejecting offers to purchase the debt issue. If the City elects to award the
debt issue, the Consultant will instruct all parties and help facilitate the actions
required to formally consummate the award.
12. Provide Pre-Cl.osing and Closing Activities.
The Consultant shall assist in arranging for the closing of each financing. The
Consultant shall assist counsel in assuming responsibility for such arrangements as
they are required, including arranging for or monitoring the progress of bond
printing, qualification of issues for book-entry status, signing and final delivery of the
securities and settlement of the costs of issuance.
CITY OF SAN JUAN CAPISTRANO/FIELDMAN, ROLAPP&ASSOCIATES Exhibit A, Page 4
EXHIBIT B
TO
FINANCIAL ADVISORY SERVICES AGREEMENT
BY AND BETWEEN
CITY OF SAN JUAN CAPISTRANO AND TI: ,LDMAN, ROLAPP &ASSOCIATES
Fees and Expenses
Pant 1: Fee for SelTices
Financial Advisory Services performed pursuant to Section 1 of this Agreement, and as more
fully described in the Scope of Services set forth in Exhibit A, will.be billed for at the amounts set
forth below:
Transaction Size Fees
$1 to $25,000,000 $52,500
$25,000,001 and above to be negotiated
Payment of fees earned by Consultant pursuant to this.Part 1. shall be contingent on, and payable
at the closing of the debt issue(s) undertaken to finance the Project. If the City elects to refund
the outstanding 2002 Certificates of Participation, an additional fee of$8,000 will be added.
Part 2: Other Services
Unless agreed to otherwise, financial advisory services performed pursuant to Section 2 of this
Agreement will be billed at the then current hourly rates. The table below reflects the 'rates in
effect as of the date of execution of this Agreement.
Personnel Hourly Rate
Executive Officers............................................................5300.00
Principals..........................................................................$290.00
Senior Vice President.......................................................$275.00
Vice Presidents .................................................................$225.00
Assistant Vice President...................................................$195.00
Senior Associate...............................................................$150.00
Associate...........................................................................$125.00
Analyst................................................................................$85.00
Administrative Assistants...................................................$65.00
Cleri.cal................................................................................$35.00
Expenses
Expenses will be billed for separately and will cover, among other things, travel, lodging,
subsistence, overnight courier, posting of POS on internet, computer, and fax transmission
charges. Advances made on behalf of the City for costs of preparing, printing or distributing
disclosure materials or related matter whether by postal services or electronic means, may also be
billed through to the City upon prior authorization. Additionally, a surcharge of 6% of the net fee
CITY OF SAN JUAN CAPISTRANO/FIELDNIAN,ROLAPP&ASSOCIATES Exhibit B, Page 1
amount is added to verifiable out-of-pocket costs for recovery of costs such as telephone, postage,
document reproduction and the like.
Limiting Terms and Conditions
The above fee is based on completion of work orders within six months of the City's
authorization to proceed, and assumes that the City will provide all necessary information in a
timely manner,
The fee shown, above in Part l presumes attendance at up to 8 meetings in the City's offices or
such other location within a 25-mile radius of the City place of business as the City may
designate. Preparation for, and attendance at City Council meetings on any basis other than "by
appointment" may be charged at our normal hourly rates as shown in Part 2, above.
Abandonment
If, once commenced, the services of the Consultant are terminated prior to completion of our final
report for any reason, we are to be reimbursed for professional services and direct expenses
incurred up to the tirne we receive notification of such termination at the standard hourly rates
shown in Part 2, subject to a minimum charge of 0.
CITY OF SAN JUAN CAPISTI2ANOlp'IELDMAN, ROLAPP&ASSOCIATES Exhibit B, Page 2
RESOLUTION NO. 10-12-07-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SAN JUAN CAPISTRANO REGARDING ITS INTENTION
TO ISSUE TAX-EXEMPT OBLIGATIONS AND TO
REIMBURSE THE CITY FROM PROCEEDS OF SUCH
OBLIGATIONS FOR COSTS INCURRED PRIOR TO
ISSUANCE (WATER SYSTEM IMPROVEMENTS)
WHEREAS, the City Council of the City of San Juan Capistrano (the
"Issuer") desires to finance the costs of acquiring certain public facilities and
improvements, as provided in Exhibit A attached hereto and incorporated herein (the
"Project");
WHEREAS, the Issuer intends to finance the acquisition of the Project or
portions of the Project with the proceeds.of the sale of obligations the interest upon
which is excluded from gross income for federal income tax purposes (the
"Obligations"); and
. WHEREAS, prior to the issuance of the Obligations the Issuer desires to
incur certain expenditures with respect to the Project from available monies of the
Issuer which expenditures are desired to be reimbursed by the Issuer from a portion of
the proceeds of the sale of the Obligations;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN JUAN
CAPISTRANO DOES HEREBY RESOLVE, ORDER AND DETERMINE AS FOLLOWS:
SECTION 1. The Issuer hereby states its intention and reasonably
expects to reimburse Project costs incurred prior to the issuance of the Obligations with
proceeds of the Obligations. Exhibit A describes either the general character, type,
purpose, and function of the Project, or the fund or account from which Project costs are
to be paid and the general functional purpose of the fund or account.
SECTION 2. The reasonably expected maximum principal amount of the
Obligations is $20,000,000, with respect to the Water System Improvements described
at Exhibit A.
SECTION 3. This resolution is being adopted on or prior to the date (the
"Expenditures Date or Dates") that the Issuer will expend monies for the portion of the
Project costs to be reimbursed from proceeds.of the Obligations.
SECTION 4. Except as described below, the expected date of issue of
the Obligations will be within eighteen months of the later of the Expenditure Date or
Dates and the date the Project is placed in service; provided, the reimbursement may
not be made more than three years after the original expenditure is paid. For
Obligations subject to the small issuer exception of Section 1480(4)(D) of the Internal
Revenue Code, the "eighteen-month limit" of the previous sentence is changed to "three
DQCSOC/1449961 v 1/022658-0028
ATTACHMENT 3
years" and the limitation of the previous sentence beginning with ", provided, . . . ." is not
applicable.
SECTION 5. Proceeds of the Obligations to be used to reimburse for
Project costs are not expected to be used, within one year of reimbursement, directly or
indirectly to pay debt service with respect to any obligation (other than to pay current
debt service coming due within the next succeeding one year period on any tax-exempt
obligation of the Issuer (other than the Obligations)) or to be held as a reasonably
required reserve or replacement fund with respect to an obligation of the Issuer or any
entity related in any manner to the Issuer, or to reimburse any expenditure that was
originally paid with the proceeds of any obligation, or to replace funds that are or will be
used in such manner.
SECTION 6. This resolution is consistent with the budgetary and financial
circumstances of the Issuer, as of the date hereof. No monies from sources other than
the .Obligation issue are, or are reasonably expected to be reserved, allocated on a
long-term basis, or otherwise set aside by the Issuer (or any related party) pursuant to
their budget or financial policies with respect to the Project costs. To the best of our
knowledge, this City Council is not aware of the previous adoption of official intents by
the Issuer that have been made as a matter of course for the purpose of reimbursing
expenditures and for which tax-exempt obligation's have not been issued.
SECTION 7. The limitations described in Section 3 and Section 4 do not
apply to (a) costs of issuanceefthei Obligations, (b) an amount not in excess of the
lesser of $100,000 or five percent (50%) of'the proceeds of the Obligations, or (c) any
preliminary expenditures, such as architectural, engineering, surveying, soil testing, and
similar costs other than land acquisition, site preparation, and similar costs incident to
commencement of construction, not in excess of twenty percent (20%) of the aggregate
issue price of the Obligations that finances the Project for which the preliminary
expenditures were incurred.
SECTION 8. This resolution is adopted as official action of the Issuer in
order to comply with Treasury Regulation § 1.150-2 and any other regulations of the
Internal Revenue Service relating to the qualification for reimbursement of Issuer
expenditures incurred prior to the date of issue of the Obligations, is part of the Issuer's
official proceedings, and will be available for inspection by the general public at the
main administrative office of the Issuer.
SECTION 9. All the recitals in this Resolution are true and correct and
this City Council so finds, determines and represents.
Mayor
2
DOCS OC/1449961 v 11022058-0€328
ATTEST:
City Clerk
AYES:
NOES:
ABSENT:
3
DOCSQC/1449961v1/022658-0028
STATE OF CALIFORNIA )
COUNTY OF ORANGE) ss.
1, Mayor of the City of San ,Juan Capistrano, hereby certify
that the above and foregoing Resolution was duly and regularly adopted by the said City
Council at a regular meeting thereof held on the day of December, 2010 and
passed by the following vote:
AYES:
NOES:
ABSENT:
IN WITNESS WHEREOF, I have hereunto set my hand and seal this
day 2010.
4
DOC SOC/1449961 v 1/022658-0028
EXHIBIT A
DESCRIPTION OF PROJECT
Water System Improvements:
Recycled Water
Existing Service Retrofits, 425 N. Reservoir,
Recycled Water— Pressure Reducing Valves and Pump Stations,
Recycled Water—Transmission Lines,
Domestic Water
Pump Stations Improvements,
SCADA System Improvements,
GWRP PlanVRegional Domestic Distribution Facility Expansion — Phase II,
San Juan Hills DIP Waterline Replacements,
760 S. Reservoir - Phase II,
Emergency Standby Electrical Generation
Pressure Regulating Stations
And other similar projects benefiting the water system.
5
OC;SOC/1449961 v 1/022658-0028
City of San Juan Capistrano Public Financing Authority
Revenue Certificates ofParticipation
Series 2(}�1
TIME AND RESPONSIBILITY SCHEDULE
Revised on:
Tuesday,November 02,2010
I = Issuer_City of San Jnan Capistmno
BC =Bond Counsel-Strad ling Yocca Carlson&Rautn
DC=Disclosure Counsel-Sr=adling Yocca Carlson&Rauth
FA = Financial Advisor-Fieldman,Rolapp&Associaees
T=Trustee-Bank of New Yoxk Mellon
U = Underwriter-'T 3D
0 . #
'T`uesday,November Ota,201f) All-hands kick-off meceing @ TBD 1,BC,DC,i=A
Thursday,November 11,2010 HOLIDAY-VETERANS'DAY(same markets closed)
City Council meeting @[7:30 p.m.)to;
Tuesday,November 16,2010 Approve Reimbursement resolution I
Approve consultant contracts
Thursday,Novcmber 18,2010 Distribute I st drafi of legal and financing documents 13C,DC:
vlcninp/Conference Call rr TBD to discuss 1st draft of legal
Tuesday,November 2.3,2(YI('i All
and financing documents
Thursday,November 25,2010 HOLIDAY-THAN,KSGIVING DAY All
Wednesday,Decdn ber 01,2010 Ihstfibutc 2nd draft of legal and financing docurnents and I St 13C DC,FA
draft of Notice of Sale(NOS)and credit presentation
Conference Cali a TBI to discuss 2nd draft of legal and
Monday,December(G,2(}70 All
Financing docs and Ist draft ofNOS and credit presentation
Dis�ributc 31d draft of le al and financing docs and 2nd draft of
7 hursdati�,December 09,2[}10 g ' BC,-)C,[LA
NOS and credit presentation
Wednesday,December 15,2610 Conference call @'T13D to discuss revised credit presentation BC DC,
and any last comments to legal and financing docs`and NOS
Friday;December 17,2010 City-wide futlougb begins 1
I/- Monday,December 20,2010 Credit Package sent to SSCP and Fitch FA
Friday,December 24,2010 HOLIDAY CHRISTMAS OBSERVED All
Friday,December 31,2010 HOLIDAY-NEW YEAR'S DAY OBSERVED All
Tuesdhyjanuary 1}1,,2011 "Walk-thvough"call to.prepare for mating agency meetings/calls I FA
on 1/6/2011
�/- Thursday,January 06,2011 Conference Calls or Meetings with S&P and Fitch 1,FA
Tlxursday,January 06,2011 Agenda deadline for Financing=authority meeting on I/18/2011 1
Thursday,January 13,2011 Credit Matings received 1,FA
Monday,January 17,2011 HOLIDAY-MARTIN LUTHER ICING DAY All
OBSERVED
FRA Prefect No.10205
flt.h123187,x1s Page 1 of 2
ATTACHMENT 4
City of San Juan Capistrano Public Financing Authority
Revenue Certificates of Participation
Series 2011
TIME AND RESPONSIBILITY SCHEDULE
Public Financing Authority Meeting @t 17:30 p.m.]to:
"Tuesday,January 18,2011 Approve legal and financing documents 1
authorize release of POS and NOS
Delegatc authority to Finance Ditector to award COPs
Publish Notice of Sale(shor;:form)i;i Bmid Buyar(S-day F
1"huirsday,January 2(l,2011 requirement)and local napex(10-day requitement)
Print&;nail POS&NOS(long form)and post electronically DC
Tuesd.y,l,ebruary 01,2011 Rtceive bids/Price Cops I,vj�
Tuesday,Fcbruary 08,2011 Print and mail Final Official Statement L7£:
Monday,February 14,2011 Prc-elosing All
'I'ucsdiy,F bruary 15,2011 Cloning and rcceiptof funds Alk
3
V, ,. .
MA Pro)ect No,10205
FRA12318TA.s Page 2 of 2
Nov 9,2010 5:04 Pm Prepared by DBC Finance (Finance 6�.Q7 8 Saiz Juan C`apislrano.City af:Ct) lad) Pagel
SOURCES AND USES Or FUNDS
City of San Juan Capistrano
2011 Refunding&Nein Money COPS
Sources: 2011 NFW 2011 REF Totat
Bond Proceeds:
Paz'Atnoua 19,365,000.00 4,825,000.00 24,190,000.00
Premium 232,950.255115,637.263 738,587.44
19,597,95025 _ 5,330,637.20 �W 24,928,587.45
Other Sources of Funds
Debt Service Reserve Fund 679,853,76 679,853.76
19,597,950.25 6,010,490.96 25,608,44121
Eases: 2017 NEW 2011_REF Total.
Project Fund Deposits:
Project Fund 18,000,0630.40 18,400,000.1}63
Refundfi�g Escrow Deposits:
Cash 17e06sit 0.44' 0.44
SLOS Purchases 5,617 ...994.00 5,611,994.00
5,6211,994.44 X5,611.,994.44
Other Fund Deposits:
Dobt Service Reserve Fund 1.,199,365.15 298,834.85 1,498,200.00
Delivery Bate Expenses:
Cost of Issuance 200,134.35 49,$65.615 250,000.00
Underwriter's Discomfit 133,650.(30 48,2501.00 241,900,00
393,784.35 98,1.15.05 491,900.00
Other Uses of Funds:
Additional Proceeds 4,800.75 1,546.02. 6,346.77
19,597,9%25 6,010,494.96 25,608,441.21
Note: Based on East Valley Fater District`AA-`scale:as of 10/20/10
ATTACH M ENT
Nov 9,201.0 5.04 pm Prepared.by DBC Finance (Finance 6.018 San Juan f apistrano,City of:CO1k BO) Page 2
SUMMARY OF IZEF()NDING RESULTS
City of San Juan Capistrano
2002 Refunding
Bated Bate 02/1.512011.
Deli my Date 02/1512011
Arbi=rage yield 4.305348%a
Escrow yield 0.101734%
Bond Par Amount 4,825,000.00
True Interest.Cost 2.645167%
Net Interest Cost 2-822321%
Average Coupon 4.367121%
Average Life 6.136
Par amount of refunded bonds 5,535,fl00.OQ
Average coupon of refunded bonds 4.917112%
Average life of refunded.bonds 6.246
PV of prior debt to 0211512011 @ 4.305348%c 5,763,452.25
Net PV Savings 544,954.84
Per nta c savysoof refunded bonds 9.845616,,/ S ir,&uLkT
Pementage savings of refunding bonds 11.2944(11% baa
Nov 9,2010 5:04 pm prepared.by DBC Finance (Finance 6.018 San Juan Capistrano,City of:COMBO) Page.3
SAVINGS
City of San Juan Capi strand
2011 Refunding&hew Money COPS
Present Value
Prior Refunding to 02115/2011
Date Debt Service Debt Service Savings C 4,3053479%
12/0112011 663,213.76 580,075.56 83,138.20 81,914.53
12/01/2012 661,713.76 551,700.00 110,013.76 102,516.38
32/01/2013 664,076.26 554,400.00 109,676.26 97,842.82
12/01/2014 664,936.26 554,400.00 110,536.26 94,456.30
1.2/01/2015 664,461.26 553,800.00 110,661.26 90,576.41
12101./2016 662,492.50 553,550.(30 108,942.50 85,441.89
12/01/2017 663,732.50 556,550.00 107,182.50 80,506M
12101/2018 663,382.50 554;300.00 109,082.50 78,488.57
12101/2019 661,132,50 551,050.00 11€1,082.50 75,873.38
121€31/2020 657,632,50 551,800.0[3 105,832.50 69,878.91
12101/2021 6612,287.50 556,400.00 105,987.50 66,931.95
7,289,061,.30 6,118,025.56 1,171,035.74 924,427.73
Savings Surnin ry
PV of savings from cash flow 924,427,73
Less:Prior fwids on hand -679,853.76
Plus:Refunding funds cin hand 300,380.87
Net PV Savings 544,954.84
f
J
a
32400 PAt,ADELANTO ML
AN.silAN CAPfS`CRANO,Com. :d' t � E.
e ase LAURAF EW
493.8053 FAX v Es101wha THOMAS W,HE
1vww.sonjuaa:°rapivrano.t'n- 1774 V
NOTIFICATION OF MEETING OF POTENTIAL INTEREST
OF THE SAN JUAN CAPISTRANO CITY COUNCIL
The City Council of San Juan Capistrano will meet at 6:30 p.m. on Tuesday, December 7,
2010, in the City Council Chamber in City Hall, to consider: "Consideration of
Agreements for Bond Counsel and Financial Advisor Services for the Proposed Deft
Financing - Series 2011 Related to Water System Facilites and Reimbursement
Resolution for Costs; and Possible Refunding of Certificates of Participation, Series
2002 (Stradling, Yocca, Carlson, and Rauth and Fieldman, Rolapp, and Associates)"
— Item No. E6.
If you have specific thoughts or concerns regarding this item, you are encouraged to
participate in this decision making process. You can communicate with the City Council
through correspondence addressed to the Council and/or by attending the meeting and
speaking to the Council during the public meeting.
Correspondence related to this item must be received at the City Clerk's office by 5:00 p.m.
on Monday, December 6, 2010, to allow time for the Council to consider its content.
If you would like to speak at the meeting, please complete a yellow "Request to Speak"
form found inside the entrance to the Council Chamber. This form is turned in at the staff
table, just in front of the Council dais. You will be called to speak by the Mayor when the
item is considered.
You have received this notice at the request of the City staff member Cindy Russell, Chief
Financial Officer/Treasurer. You may contact that staff member at (949) 443-6301 with any
questions.
The agenda, including agenda reports, is available to you on our web site:
www.sanivancapistrano.org. If you would like to subscribe to receive a notice when
agendas are posted to the web site, please make that request by sending an e-mail to:
cityclerk(cD-sanjuancapistrano.org.
Maria Morris, CMC
City Clerk
cc: Stradling, Yocca, Carlson and Rauth; Fieldman, Rolapp, and Associates
San Jitan Capistrano: Nescs ), ag the nasi to IL-tlhawx the Putum
32400 PAS L7 ADL ANTO lf, MEMBERS OF THE CITY COUNCIL
SANE.JUAN CAPISTRANO,CA 92675
(949)493-1171 SAhAALLEVATO
L,A
(949)493-10353 FAX a 9iuAP9491E& LARRY
ES1AAElSAEB ��s� AMEMER
www.sanjuancapistrano.org 1776 DEREK REEVE
® JOHN TAYLOR
s r
TRANSMITTAL
TO:
Fieldman, Rola p, and Associates
Attn: James Fabian
19900 MacArthur Blvd, Ste 1100
Irvine, CA 92612
DATE: January 12, 2011
FROM: Kristen Lewis, Administrative Specialist (949) 443-6308
RE: Personal Services Agreement — 2011 Water Revenue Certificates of Participation
Thank you for maintaining documentation confirming compliance with the terms of the
agreement related to insurance.
Please keep in mind this documentation must remain current with our office during the term of
this agreement. If you have questions related to insurance requirements, please call me at
(949) 443-6308.
If you have questions concerning the agreement, please contact Cindy Russell, Chief Financial
Officer/Treasurer, at (949) 443-6301.
An original agreement is enclosed for your records.
Cc: Cindy Russell, Chief Financial Officer/Treasurer
Lori Fuentes, Administrative Coordinator
San Juan Capistrano: Preserving the Past to Enhance the Future
e�
Printed on 1DO%recycled paper
Isurnce
If Insurance`,is good, execute the agreement:':
Mai-i'a's signature
Copy of transrnttai fqr file
°Copy of packet to prgJect rmanager
fJ C3rigina! m�il�d 'out
Uerify (Need v�ithin.l�3 days o� e'xecution�
Scan to Ap.p(scatian Extender
Greate'new .�ile7 # �� . .�
if yes
Add to C�ty'Uiew
�''
I�A'ction R mi
e _. rider
Notes:
� � , . � .
� �
��
� �
� � � �� �
� ��, � �-
Today's Date:_—11116/10 Transmittal Routing
(Check.Aii That Apply)
® City Attorney
® City Manager
® City Clerk
CONTRACT TRANSMITTAL
CIP No. (if any):
Project Manager's Last Name: —Russell :---Phh-onbe-EE-Rften n: 6301
Council or CIA Meeting Date (if applicable): L Z�
APPROVING AUTHORITY: (Check One)
Ll Mayor
LJ CRA Chair
City Manager
Provide (1) executed original contract for each signing party, including the City. If the agreement is to be
recorded - only (1) original will be recorded with certified copies going to other parties.
Please provide the mailing address of any party to receive an agreement - unless the mailing address is
included within the body of the agreement:
Names Street City St Zip
Fieldman, Rolapp and Associates 19900 MacArthur Blvd, Suite Irvine CA 92612 !
1100
OTHER INSTRUCTIONS:
Please return to Lori. Thank you.
Form Date: 01-2004 D-7
9