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HomeMy WebLinkAboutMINUTES - 09182001 - C.51 TO: BOARD OF SUPERVISORS ,��'s ...... Contra FROM: John Sweeten, County Administrator : ni 0. -;� s Costa DATE: September 18, 2001 STA-CO--- � County SUBJECT: Subordination of revenues for City of Brentwood C S� SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATION: APPROVE agreement subordinating revenues due to the County, Library and Flood Control District for tax allocation bonds, pursuant to the 1991 agreement with the Brentwood Redevelopment Agency. AUTHORIZE execution of Agreement by Board Chair. BACKGROUND: On July 29, 1991, the County approved a redevelopment pass through agreement with the Brentwood Redevelopment Agency. Included in the agreement is a subordination clause which essentially allows the agency to put debt owed to the County lower in priority than debt owed to bond holders, as added assurance to bond holders that their investment will be returned. The County agreed to this provision based upon the commitment that the agency would have on hand adequate funds to pay back bond holders, thereby minimizing the real risk that subordination would be necessary. The Agency proposes to issue up to $23,000,000 in bonds to refund all outstanding bonds and provide for additional financing for projects. The Agency has provided documents to staff which demonstrate that adequate revenue commitment has been met. Therefore, it is appropriate to agree to the subordination as called for in the 1991 agreement. ATTACHMENT: ZYES SIGNATURE: —) E�' COMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE -- — APPROVE OTHER SIGNATURE(S): ------------------------------ --- -- ---- ------------ ------- ------------------------- ACTION OF BOA 0 APPROVE AS RECOMMENDED— $ " VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A TRUE /� AND CORRECT COPY OF AN ACTION TAKEN UNANIMOUS(ABSENT c//ZI/YIJ21 ) AND ENTERED ON THE MINUTES OF THE BOARD OF SUPERVISORS ON THE DATE AYES: NOES: SHOWN. ABSENT: ABSTAIN: p- ATTESTEDO / CONTACT: Tony Enea(5-1094) JOHN SWEETEN,CLERK OF THE BOARD OF SUPERVISORS AND '0' COUNTY ADMINISTRATOR CC: County Administrator Jim Kennedy,Redevelopment City of Brentwood County Counsel BY UTY SUBORDINATION AGREEMENT This Subordination Agreement, dated as of September 1, 2001 (this "Subordination Agreement"), is entered into by and among the Redevelopment Agency of the City of Brentwood (the "Agency") and the County of Contra Costa(including the Contra Costa County Library District), the Contra Costa County Flood Control and Water Conservation District and the East Diablo Fire District (collectively referred to herein as the "Taxing Agencies"). RECITALS The Agency and the Taxing Agencies previously entered into a Fiscal Agreement, dated July 29, 1991 (the"Agreement"), regarding the pass through of tax increment pursuant to California Health & Safety Code Section 33401, which provides for, among other matters, the allocation and payment of certain tax increment revenue from the Agency's North Brentwood Redevelopment Project Area to the Taxing Agencies. Under the Agreement, the Taxing Agencies may agree to subordinate, under certain conditions, their rights to receive such tax increment revenue in order for the Agency to pledge such tax increment revenue to long-term bonded indebtedness to be incurred by the Agency. The Agency has merged the North Brentwood Redevelopment Project Area with its Brentwood Redevelopment Project Area to form its Merged Redevelopment Project Area. The Agency now intends to issue its Merged Project Are Tax Allocation Bonds, Series 2001 (the "Bonds") in an aggregate principal amount not to exceed $23,000,000 for the purpose of refunding all of the outstanding Brentwood Redevelopment Project Tax Allocation Bonds, Series A and to finance the Merged Redevelopment Project. The Agency has requested that the Taxing Agencies enter into this Subordination Agreement to provide for the subordination of tax increment revenue payments under the Agreement in order for the Agency to pledge such tax increment revenue to the Bonds. The Agency has provided the Taxing Agencies with a report, which includes revenue forecasts and a debt service schedule relating to all of the Agency's currently outstanding bonds with respect to the Merged Redevelopment Project Area(or any portion thereof) (the "Report"), showing that the Agency's anticipated ability to repay such bonds can be made without demand being made on the aforementioned payments due to the Taxing Agencies under the Agreement. The Report shows that the aggregate of the tax increment revenue payments to be subordinated are contemplated to be used in the cash-flow relating to such bonds only for additional security (debt service coverage) and that the Agency's tax incremental revenues will be adequate, over the terns of such bonds, to pay one hundred percent (100%) of the actual debt service thereon and to pay the Agency's obligations under the Agreement, and any other obligations of the Agency, whether statutory or contractual, which are or would be superior to the Agency's obligations under the Agreement. DMSC1:291589.2 40357-14 REL AGREEMENT Therefore, the parties hereto agree as follows: 1. Pursuant to Section 2 of the Agreement, the Taxing Agencies hereby subordinate their rights to receive tax increment revenue payments under the Agreement, in order to allow the Agency to pledge such tax increment revenue to the Bonds (and any refunding obligations hereafter issued the proceeds of which, excluding costs of issuance and bond reserves, are used to refund the Bonds). 2. In accordance with said Section 2, in the event that payments to the Taxing Agencies made pursuant to the Agreement are reduced below the amount otherwise payable to them under the Agreement as a result of such subordination, then such reduction shall be treated as an advance by the Taxing Agencies and shall be repaid by the Agency in accordance with the Agreement. 3. The Agency agrees to expend the proceeds of the Bonds to accomplish the refunding described above and otherwise in furtherance of the Redevelopment Plan for the Merged Redevelopment Project Area. [Remainder of page intentionally left blank.] DCCSSC1:291589.2 40357-14 REL 2 COUNTY: AGENCY: COUNTY OF CONTRA COSTA REDEVELOPMENT AGENCY OF THE CITY OF BRENTWOOD Contra Costa County Flood Control and Water Conservation District By: Executive Director East Diablo Fire District By: Ch erson Board of Supervisors Attest: JOHN SWEETEN CLERK OF THE BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR B y:A eDepu�tyClerk � Approved as to form: SILVANO MARCHESI COUNTY COUNSEL By: Deputy DOCSSC1:291589.2 40357-14 REL 3 1 . SUBORDINATION AGREEMENT This Subordination Agreement, dated as of September 1, 2001 (this "Subordination Agreement"), is entered into by and among the;Redevelopment Agency of the City of Brentwood (the"Agency") and the County of Contra Costa(including the Contra Costa County Library District), the Contra Costa County Flood Control and Water Conservation District and the East Diablo Fire District (collectively referred to herein as the "Taxing Agencies"). RECITALS The Agency and the Taxing Agencies; previously entered into a Fiscal Agreement, dated July 29, 1991 (the "Agreement"), regarding the pass through of tax increment pursuant to California Health & Safety Code Section 33.401, which provides for, among other matters, the allocation and payment of certain tax increment.revenue from the Agency's North Brentwood Redevelopment Project Area to the Taxing Agencies. Under the Agreement, the Taxing Agencies may agree to subordinate, under certain conditions, their rights to receive such tax increment revenue in order for the Agency to pledge such tax increment revenue to long-term bonded indebtedness to be incurred by the Agency. The Agency has merged the North Brentwood Redevelopment Project Area with its Brentwood Redevelopment Project Area to form its Merged Redevelopment Project Area. The Agency now intends to issue its Merged Project Are Tax Allocation Bonds, Series 2001 (the "Bonds") in an aggregate principal amount not to exceed $23,000,000 for the purpose of refunding all of the outstanding Brentwood Redevelopment Project Tax Allocation Bonds, Series A and to finance the Merged Redevelopment Project. The Agency has requested that the Taxing Agencies enter into this Subordination Agreement to provide for the subordination of tax increment revenue payments under the Agreement in order for the Agency to pledge such tax increment revenue to the Bonds. The Agency has provided the Taxing Agencies with a report, which includes revenue forecasts and a debt service schedule relating to all of the Agency's currently outstanding bonds with respect to the Merged Redevelopment Project Area(or any portion thereof) (the "Report"), showing that the Agency's anticipated ability to repay such bonds can be made without demand being made on the aforementioned payments due to the Taxing Agencies under the Agreement. The Report shows that the aggregate of the tax increment revenue payments to be subordinated are contemplated to be used in the cash-flow relating to such bonds only for additional security (debt service coverage) and that the Agency's tax incremental revenues will be adequate, over the term of such bonds, to pay one hundred percent (100%) of the actual debt service thereon and to pay the Agency's obligations under the Agreement, and any other obligations of the Agency, whether statutory or contractual, which are or would be superior to the Agency's obligations under the Agreement. DCCSSC1:291589.2 40357-14 REL AGREEMENT Therefore, the parties hereto agree as follows: j 1. Pursuant to Section 2 of the Agreement, the Taxing Agencies hereby subordinate their rights to receive tax increment revenue payments under the Agreement, in order to allow the Agency to pledge such tax increment revenue to the Bonds (and any refunding obligations hereafter issued the proceeds of which, excluding costs of issuance and bond reserves, are used to refund the Bonds). 2. In accordance with said Section 2, in the event that payments to the Taxing Agencies made pursuant to the Agreement are reduced below the amount otherwise payable to them under the Agreement as a result of such subordination, then such reduction shall be treated as an advance by the Taxing Agencies and shall be repaid by the Agency in accordance with the Agreement. 3. The Agency agrees to expend the proceeds of the Bonds to accomplish the refunding described above and otherwise in furtherance of the Redevelopment Plan for the Merged Redevelopment Project Area. [Remainder of page intentionally left blank.] DCCSSC1:291589.2 40357-14 REL 2 ;s es/ a COUNTY: AGENCY: COUNTY OF CONTRA COSTA REDEVELOPMENT AGENCY OF THE CITY OF BRENTWOOD Contra Costa County Flood Control and Water Conservation District By: Executive Director East Diablo Fire District BY: Cha' erson Board of Supervisors Attest: JOHN SWEETEN CLERK OF THE BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR By: _ Deputy Jerk' Approved as to form: SILVANO MARCHESI COUNTY COUNSEL By: Deputy DCCSSC1:291589.2 40357-14 REL 3 OCT--94-2MI M-23 MIN HE l Wbtt W 4157734246 P. AGHNCY: OF CONTRA CQ5"X`�+► REDB�� �AG�F�CY OF THIS cO'er ary Contra Caste County Flood COMO,and'Watts C SLk afsm .,....•••• ""'•'"" _ Diswot No Diffttor Sw DW&Ztto DlWa of swavwm Aticat TORN 5'�VBB1'�N Ct MK Ov TTW BOARD OF SUpURviSORS AND COUNTY AOM OTRATOR RYDepty Ci Appwvcd as to 1+ rM'. sn.VANO AAARCHiF.MX COUNT"'COt313S4�- rxxssp;z9l589.2 3�tic Rt3i. 90/90 'd I Vs91 SSZS ON Xvd H I IdtlO QOOMINAB 30 AI I 0 Wd 96:20 DHZ I og-m-inn .y L' RECEIVED:' JEAN 2002 E SUBORDINATION AGREEMENT CLERK BOARD ORSUPERVISORS CONTRA COSTA CO. This Subordination Agreement, dated as of September 1, 2001 (this "Subordination Agreement"), is entered into by and among the Redevelopment Agency of the City of Brentwood (the"Agency")and the County of Contra Costa(including the Contra Costa County Library District), the Contra Costa County Flood Control and Water Conservation District and the East Diablo Fire District (collectively referred to herein as the "Taxing Agencies"). RECITALS The Agency and the Taxing Agencies previously entered into a Fiscal Agreement, dated July 29, 1991 (the"Agreement"), regarding the pass through of tax increment pursuant to California Health& Safety Code Section 33401,which provides for, among other_matters, the allocation and payment of certain tax increment.revenue from the Agency's North Brentwood Redevelopment Project Area to the Taxing Agencies. Under the Agreement, the Taxing Agencies may agree to subordinate, under certain conditions, their rights to receive such tax increment revenue in order for the Agency to pledge such tax increment revenue to long-term bonded indebtedness to be incurred by the Agency. The Agency has merged the North Brentwood Redevelopment Project Area with its Brentwood Redevelopment Project Area to form its Merged Redevelopment Project Area. The Agency now intends to issue its Merged Project Are Tax Allocation Bonds, Series 2001 (the "Bonds") in an aggregate principal amount not to exceed $23,000,000 for the purpose of refunding all of the outstanding Brentwood Redevelopment Project Tax Allocation Bonds, Series A and to finance the Merged Redevelopment Project. The Agency has requested that the Taxing Agencies enter into this Subordination .. a.. ,. ',7 'l ♦1.., l�.�r�...nti�n r,f 47v i.nnromant apt.vr111 P.nnymentC Ilndp.r thp.. gic`Gl'TlE'TlltU �1VV1UG 1V1 111G Juuvlu.iictaavai v. gun aaa�.avaiavaaa .. t,..,.......... ... ..... ... Agreement in order for the Agency to pledge such tax increment revenue to the Bonds. The Agency has provided the Taxing Agencies with a report,which includes revenue forecasts and a debt service schedule relating to all of the Agency's currently outstanding bonds with respect to the Merged Redevelopment Project Area(or any portion thereof) (the"Report"), showing that the Agency's anticipated ability to repay such bonds can be made without demand being made on the aforementioned payments due to the Taxing Agencies under the Agreement. The Report shows that the aggregate of the tax increment revenue payments to be subordinated are contemplated to be used in the cash-flow relating to such bonds only for additional security (debt service'coverage) and that the Agency's tax incremental revenues will be adequate, over the term of such bonds, to pay one hundred percent (100%) of the actual debt service thereon and to pay the Agency's obligations under the Agreement, and any other obligations of the Agency, whether statutory or contractual, which are or would be superior to the Agency's obligations under the Agreement. i DOCSSC1:291589.2 40357-14 REL J AGREEMENT Therefore, the parties hereto agree as follows: 1. Pursuant to Section 2 of the Agreement, the Taxing Agencies hereby subordinate their rights to receive tax increment revenue payments under the Agreement, in order to allow the Agency to pledge such tax increment revenue to the Bonds (and any refunding obligations hereafter issued the proceeds of which, excluding costs of issuance and bond reserves, are used to refund the Bonds). 2. In accordance with said Section 2, in the event that payments to the Taxing Agencies made pursuant to the Agreement are reduced below the amount otherwise payable to them under the Agreement as a result of such subordination, then such reduction shall be treated as an advance by the Taxing Agencies and shall be repaid by the Agency in accordance with the Agreement. 3. The Agency agrees to expend the proceeds of the Bonds to accomplish the refunding described above and otherwise in furtherance of the Redevelopment Plan for the Merged Redevelopment Project Area. [Remainder of page intentionally left blank.] DOCSSCi:291589.2 40357-14 REL 2 COUNTY: AGENCY: COUNTY OF CONTRA COSTA REDEVELOPMENT AGENCY OF THE CITY OF BRENTWOOD Contra Costa County Flood Control and Water Conservation District B /4xecutilve Directo East Diablo Fire District By:11 Chai son Board of Supervisors Attest: JOHN SWEETEN CLERK OF THE BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR By. Deputy Clerk Approved as to fon-n: .... ........ . _ SILVANO MARC.HESI COUNTY COUNSEL By: Deputy DMSC1:291589.2 40357-14 REL 3 ® Cityo f Brentwood g NTWaDD city ferk:s Office ,,ren(Diaz, City Cle?, it is our pleasure to serve you For your Information The information you requested is attached We thought you might find this of interest Staff report for upcoming City Council meeting V"Comments �y r wl Sent by. ' 1 708 Third Street Brentwood, CA 94513 (925) 516- - FAX (925) 516-5441 -a co a N m m 0 a cD .a W W W tD 4'> Q vi X N N 0