200 S. Anaheim Blvd.
Suite #643
Anaheim, CA 92805
Tel: (714) 765-5195
Fax: (714) 765-5260
www.anaheim.net
CITY COUNCIL AGENDA REPORT
City of Anaheim
FINANCE DEPARTMENT
DATE: NOVEMBER 13, 2024
FROM: FINANCE DEPARTMENT
SUBJECT: FINANCING FOR BENEVOLENCE INDUSTRIES
INCORPORATED
ATTACHMENT (Y/N): YES ITEM # 20
GOVERNMENT CODE § 84308 APPLIES: YES
REQUESTED ACTION:
That the City Council, following a public hearing under the requirements of the federal Tax Equity and Fiscal Responsibility Act (TEFRA) and the Internal Revenue Code of 1986, as amended (the Code), by Resolution:
1. Approve the issuance of the California Enterprise Development Authority Revenue Bonds (Bonds), in an aggregate principal amount not to exceed $37,000,000, for the purpose of financing and refinancing the cost of the acquisition, construction, renovation, equipping and furnishing of healthcare facilities and other related and appurtenant facilities for the benefit of Benevolence Industries Incorporated, d/b/a Benevolence Health Centers, a California nonprofit public benefit corporation, located at: 1010 Crenshaw Boulevard, Suite 100, Torrance, California 90501; 303 North East Street, Anaheim, California 92805 (the Anaheim Facility); 1126 East South Street, Long Beach, California 90805; 505-515 North Arrowhead Avenue, San Bernardino, California 92401; 3631 Crenshaw Boulevard, Suite 109, Los Angeles, California 90016; and 12610 Glenoaks Boulevard (also known as 14040 Hubbard Street), Sylmar, California 91342 (collectively with the Anaheim Facility, Facilities), and providing the terms and conditions for such Bonds and other matters relating thereto.
DISCUSSION:
Background
The California Enterprise Development Authority (the Authority) is a Joint Exercise of Powers Authority (JPA) established by the California Association for Local Economic Development (CALED) whose purpose is to issue tax-exempt and taxable conduit revenue bonds to fund commercial and industrial development projects within member jurisdictions, including to finance and refinance facilities owned and/or leased by organizations described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the Code).
Financing for Benevolence Industries Incorporated
November 13, 2024
Benevolence Industries Incorporated, d/b/a Benevolence Health Centers, a California nonprofit public benefit corporation (the Borrower), is a federally qualified health center offering patient clinical care, patient safety, and education. Since 2005, the Borrower has provided health care and educational programs to the under-served and uninsured in Southern California. The Borrower’s goal is to be a beacon of hope for minorities and economically disadvantaged communities, providing community access to medical, dental and mental health clinics, including adult day health care centers, case management, youth programs as well as HIV/AIDS prevention and treatment.
The Borrower is an organization described in Section 501(c)(3) of the Code, and operates the Facilities in connection with its mission of providing quality health care and excellent educational programs to the under-served and uninsured in Southern California.
Project Description
The Authority requested the City of Anaheim (City) facilitate a public hearing as required by TEFRA and the Code. The Authority will loan the proceeds of the Bonds to the Borrower for the purpose of: (a) financing and/or refinancing the cost of acquisition, construction, renovation, equipping and furnishing of certain healthcare and ancillary facilities located at (i) 1010 Crenshaw Boulevard, Suite 100, Torrance, California 90501, consisting of approximately 15,106 square feet, (ii) 303 North East Street, Anaheim, California 92805, consisting of approximately 2,365 square feet (the Anaheim Facility), (iii) 1126 East South Street, Long Beach, California 90805, consisting of approximately 4,330 square feet, (iv) 505-515 North Arrowhead Avenue, San Bernardino, California 92401, consisting of approximately 58,160 square feet, (v) 3631 Crenshaw Boulevard, Suite 109, Los Angeles, California 90016, consisting of approximately 15,000 square feet, and (vi) 12610 Glenoaks Boulevard (also known as 14040 Hubbard Street), Sylmar, California 91342 consisting of approximately 9,786 square feet (collectively with the Anaheim Facility, the Facilities), (b) fund a debt service reserve fund, working capital and capitalized interest with respect to the Bonds; and (c) pay certain costs of issuance and other related costs in connection with the issuance of the Bonds.
The issuance of the Bonds will allow the Borrower to purchase its currently leased facilities and reduce financing costs and debt service costs for the Borrower. In order to satisfy the requirements for the Bonds to be issued as tax-exempt, the issuance of the Bonds by the Authority must be approved in accordance with Section 147(f) of the Code following a Tax Equity and Fiscal Responsibility Act (TEFRA) hearing by the applicable representative of the governmental unit having jurisdiction of the territory in which the Facilities are located. The City Council of the City of Anaheim is the elected legislative body of the City and is an applicable elected representative to approve the financing of the Anaheim Facility under Section 147(f) of the Code.
Financing for Benevolence Industries Incorporated
November 13, 2024
Financing Plan
The Authority will act as issuer and perform all of the necessary legal and administrative responsibilities associated with the financing and/or refinancing evidenced by the Bonds.
The Bonds will be paid entirely from repayments by the borrower under the Loan Agreements. The Bonds issued by the Authority are not an obligation of the City.
Neither the faith and credit nor the taxing power of the City, the State of California (the State), or any other political corporation, subdivision, or agency of the State is pledged to the payment of the principal of, premium (if any), or interest on, the Bonds; nor shall the City, the State, or any other political corporation, subdivision, or agency of the State be liable or obligated to pay the principal of, premium (if any), or interest on, the Bonds.
IMPACT ON BUDGET:
There is no budgetary impact.
Respectfully submitted,
Deborah A. Moreno
Finance Director/City Treasurer
Attachment:
1. Authorizing Resolution