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Home My WebLink AboutMINUTES - 12091997 - SD2 SD 0 - Contra _ Costa TO: BOARD OF SUPERVISORS County c uhf J FROM: Dennis M. Barry, AICP Community Development Director DATE: December 9, 1997 SUBJECT: 1991 Single Family Mortgage Revenue Taxable Refunding Bonds SPECIFIC REQUEST(S) OR RECOMMENDATIONS(S) & BACKGROUND AND JUSTIFICATION RECOMMENDATIONS As the Governing Body of the Contra Costa Home Mortgage Finance Authority, ADOPT Resolution authorizing the sale of remaining mortgages in the 1991 Single Family Mortgage Taxable Revenue Refunding Bond Program. FISCAL IMPACT No General Funds are involved. Sale of the mortgages will result in revenues that the-- Authority he-Authority members (the County and the City of Antioch) may utilize for affordable housing purposes. BACKGROUND/REASONS FOR RECOMMENDATIONS In 1984 the County and the City of Antioch created a Joint Powers Agency, the Contra Costa Home Mortgage Finance Authority, to sell single family mortgage revenue bonds for first time CONTINUED ON ATTACHMENT: XX YES SIGNATURE: RECOMMENDATION OF COUNTY ADMINISTRATOR /RE OMMENDATION OF BARD COMMITTEE APPROVE OTHER ( f I SIGNATURE(S): ACTION OF BOARD ON December 9, 1997 APPROVED AS RECOMMENDED X OTHER VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A X UNANIMOUS (ABSENT III ) TRUE AND CORRECT COPY OF AN AYES: NOES: ACTION TAKEN AND ENTERED ON THE ABSENT: ABSTAIN: MINUTES OF THE BOARD OF SUPERVISORS ON THE DATE SHOWN. Source: Jim Kennedy 335-1255 cc: Community Development ATTESTED December 9, 1997 Redevelopment Agency PHIL BATCHELOR, CLERK OF County Administrator THE BOARD OF SUPERVISORS County Counsel AND COUNTY ADMINISTRATOR Auditor Controller via Redevelopment - 11 City of Antioch BY4-" DEPUTY JK:Ih sra27/bond1991.bos homebuyers. Tax exempt bonds were sold and mortgages were made with the proceeds. In 1991 an opportunity to refund (refinance) the tax exempt bonds with taxable bonds was exercised in order for the Authority to realize value from the sale of assets. The underlying mortgages were unaffected by the transaction. The mortgages still in existence in 1991 became the security for the 1991 Taxable Refunding Bonds. Since 1991, the homeowners have been making their payments and, in most cases, either refinancing the mortgage or selling their homes, which results in a loan payoff. As these payoffs occur, the principal amount of the bonds is likewise retired. Nearly all 1991 Taxable Refunding Bonds have now been retired. Twenty mortgages still remain. In order to consolidate the servicing of the remaining loans, and to realize the asset value of these loans, a sale of the mortgages is recommended. Proceeds from the sale of the assets, together with cash currently held in accounts pledged to the Bonds, would be sufficient to pay off all Bond obligations, and return a substantial payment to the Authority members. The payment would be split pursuant to the JPA Agreement, with 25.78% going to the City of Antioch and 74.22% to the County. The remaining homeowners are unaffected by the action. Because this action is by the Governing Board of the Contra Costa Home Mortgage Finance Authority, a representative of the City of Antioch will be present and participate in the vote. SD.2 CONTRA COSTA HOME MORTGAGE FINANCE AUTHORITY RESOLUTION NO. 97/669 RESOLUTION OF THE BOARD OF THE CONTRA COSTA HOME MORTGAGE FINANCE AUTHORITY AUTHORIZING THE SALE OF THE HOME MORTGAGES RELATING TO THE AUTHORITY'S 1991 TAXABLE HOME MORTGAGE REVENUE REFUNDING BONDS, APPROVING THE FORMS, EXECUTION AND DELIVERY OF AN ASSET PURCHASE AGREEMENT AND AN ESCROW AGREEMENT AND THE DELIVERY OF ALL NECESSARY RELATED DOCUMENTS IN CONNECTION WITH THE FOREGOING ACTIONS WHEREAS, pursuant to the Indenture, dated as of July 1, 1991 (the "Indenture"),between the Contra Costa Home Mortgage Finance Authority(the"Issuer" or the "Authority") and Bankers Trust Company of California, National Association,as succeeded by First Trust of California, National Association, as trustee (the "Trustee"), the Issuer issued its $11,817,856.35 Contra Costa Home Mortgage Finance Authority 1991 Taxable Home Mortgage Revenue Refunding Bonds (the "Bonds") together with appurtenant separately registered coupons representing rights to the payment of additional interest on the Bonds (the "Registered Coupons") for the purpose of refunding its 1984 Home Mortgage Revenue Bonds (the "1984 Bonds") pursuant to Article X of an Indenture, dated as of August 1, 1984 by and between the Issuer and Manufacturers Hanover Trust Company of California (the "Original Trustee"), as amended by Supplemental Indenture No. 1, dated as of May 1, 1985, between the Issuer and the Original Trustee, said Original Trustee subsequently having been succeeded by the Trustee (capitalized terms not otherwise defined herein shall have the meanings set forth in the Indenture); and WHEREAS, .all of the Bonds have been redeemed; and WHEREAS, pursuant to the Indenture, the Registered Coupons are secured by an irrevocable pledge of the Revenues, which consist of all amounts received by the Issuer, or by the Trustee under the Indenture, from or with respect to any Home Mortgage, the Agreement, or any policy of insurance on or with respect to any Home Mortgage, including, without limiting the generality of the foregoing, scheduled payments of principal and interest required pursuant to any Home Mortgage and paid from any source (including both timely and delinquent payments), Home Mortgage prepayments, and all interest, profits or other income derived from the investment of amounts in any fund or account established pursuant.to the Indenture, but shall not include (1) Impound Payments and (2) any amount retained by any Lending Institution (other than the Issuer) as a servicing fee or other compensation in accordance with the Agreement; and DK09720/870075/#253056.3 WHEREAS, pursuant to Section 3.01 of the Indenture, the Registered Coupons are subject to mandatory redemption in whole at any time, and in part on any March 1 or September 1, from and to the extent of funds available therefor (equal to $5,000 or more) in the Bond Fund on the 45th day immediately preceding the applicable redemption date; and WHEREAS, pursuant to Section 6.10 of the Indenture, the Trustee may at any time sell all or a portion of the Home Mortgages, provided that the proceeds thereof are sufficient to redeem (and are applied to the call and redemption of) all of the Bonds and Registered Coupons; and WHEREAS, pursuant to Section 11.01(b) of the Indenture, payment of all or any Registered Coupons designated by the Issuer may be provided for by the deposit with the Trustee of Defeasance Obligations which are not redeemable in advance of their maturity dates; and WHEREAS, pursuant to Section 6.09(E) of the Indenture, from and after March 1, 2009, the Issuer and the Trustee shall cease to collect or cause to be collected, and shall waive all rights with respect to, all principal and interest .payments on outstanding Home Mortgages scheduled on or after such date unless and to the extent Home Mortgages must be sold in order to provide sufficient moneys to pay or to reimburse the Bond Insurer as otherwise permitted under the Indenture, or discharge the entire indebtedness on all Bonds and Registered Coupons Outstanding and, in each case, in the opinion of nationally-recognized bond counsel the Issuer and the Trustee may continue to collect such amounts without affecting the tax-exempt status of the 1984 Bonds; and NOW, THEREFORE, BE IT RESOLVED by the Board of the Contra Costa Home Mortgage Finance Authority (the "Board") as follows: Section 1. The Asset Purchase Agreement, dated as of December 1, 1997 (the ."Asset Purchase Agreement"), by and between the.Authority and the Purchaser (as defined. below), in substantially the form on file with the Board and presented to this meeting, is hereby approved. The Authority Representative of the Authority, as such term is defined in the Indenture (the "Authority Representative"), is hereby authorized to award the Home Mortgages to the highest responsible bidder (the "Purchaser"). Each Authority Representative, acting alone, is hereby authorized and directed, for and in the name and on behalf of the Authority, to execute and deliver the Asset Purchase Agreement in substantially the form on file with the Board and presented to this meeting, with such additions thereto or changes therein as such Authority Representative may require or approve, such approval to be conclusively evidenced by the execution and delivery of the Asset Purchase Agreement by such Authority Representative. Section 2. The Escrow Agreement, dated as of December 1, 199.7 (the "Escrow Agreement"), by and between the Authority and First Trust of California, National Association, as escrow agent, in substantially the form on file with the Board and presented in this meeting, is hereby approved. Each Authority Representative, acting alone, is hereby authorized and directed, for and in the name and on behalf of the DK09720/870075/#253056.3 2 Authority, to execute and deliver the Escrow Agreement in substantially the form on file with the Board and presented to this meeting, with such additions hereto or changes therein as such Authority Representative may require or approve, such. approval to be conclusively evidenced by the execution and delivery of the Escrow. Agreement by such Authority Representative. Section 3. The net proceeds available to the Authority after payment of all expenses in connection with the sale of the Home Mortgages pursuant to the Asset Purchase Agreement shall be transferred to the County of Contra Costa, California and the City of Antioch, California in the proportion of 74.22% and 25.78%, respectively. In no event shall the net proceeds to the County of Contra Costa and the City of Antioch resulting from the sale of the Home Mortgages, after deducting the fees and expenses set forth in Section 4.1(c) of the Asset Purchase Agreement, be less than $700,000. Section 4. Fulbright & Jaworski L.L.P. is hereby appointed as Special Counsel, and PAR Marketing Incorporated is hereby appointed as Mortgage Advisor,to the Authority in connection with the preparation and negotiation of the Asset Purchase Agreement and the Escrow Agreement. Section 5. The Authority Representative and the other officers of the Authority are hereby authorized and directed,jointly and severally, for and in the name and on behalf of the Authority, to execute and deliver any and all necessary and related certificates, documents and agreements and take all other necessary and related actions to effectuate the transactions described herein. Section 6. All actions taken by the officers, employees and agents of the Authority in connection with the Asset Purchase Agreement, the Escrow Agreement and the transactions described herein are hereby ratified, confirmed and approved. Section 7. This Resolution shall take effect immediately upon its adoption. DK09720/870075/#253056.3 3 J J." PASSED, APPROVED AND ADOPTED on this 9th day of December 1997. STATE OF CALIFORNIA ) )ss COUNTY OF CONTRA .COSTA ) I, Phil Batchelor , Secretary of the Contra Costa Home Mortgage Finance Authority, do hereby certify that the whole number of members of the Contra Costa Home Mortgage Finance Authority is six; that the foregoing resolution, being Resolution No. 97/669 , was duly and regularly adopted by said Authority at a regular meeting duly and regularly held on the 9th day of December, 1997, and that the same was so passed and adopted by the following vote: AYES: Supervisors Rogers, Uilkema, Canciamilla, DeSaulnier NOES: None ABSTAIN: None ABSENT: Supervisor Gerber / Secretary DK09720/870075/#253056.3 4