TABLE OF CONTENTS
(continued)
Page
-ii4139-2785-0833.3
Limited Recourse on Default........................................................................................... 20 Loss of Tax Exemption on the 2024 Bonds..................................................................... 20 Secondary Market for Bonds........................................................................................... 21 Uncertainties of Projections, Forecasts and Assumptions............................................... 21 TAX MATTERS.......................................................................................................................... 21 CERTAIN LEGAL MATTERS .................................................................................................. 23 CONTINUING DISCLOSURE................................................................................................... 23 ABSENCE OF LITIGATION ..................................................................................................... 24 RATING ...................................................................................................................................... 24 FINANCIAL STATEMENTS..................................................................................................... 24 UNDERWRITING ...................................................................................................................... 25 MUNICIPAL ADVISOR............................................................................................................. 25 VERIFICATION.......................................................................................................................... 25 MISCELLANEOUS .................................................................................................................... 26 APPENDIX A - INFORMATION RELATING TO THE WATER SYSTEM.......................................A-1 APPENDIX B - SUMMARY OF PRINCIPAL LEGAL DOCUMENTS...............................................B-1 APPENDIX C - FORM OF CONTINUING DISCLOSURE CERTIFICATE .......................................C-1 APPENDIX D – ECONOMIC AND DEMOGRAPHIC INFORMATION FOR THE CITY OF BRENTWOOD ............................................................................................................D-1 APPENDIX E - AUDITED FINANCIAL STATEMENTS....................................................................E-1 APPENDIX F - PROPOSED FORM OF OPINION OF BOND COUNSEL ......................................... F-1 APPENDIX G - THE BOOK-ENTRY SYSTEM ...................................................................................G-1
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$[PAR AMOUNT]*
BRENTWOOD INFRASTRUCTURE FINANCING AUTHORITY
WATER REVENUE REFUNDING BONDS
SERIES 2024
INTRODUCTION
The purpose of this Official Statement (which includes the cover page and the appendices attached hereto) is to provide information concerning the issuance, sale and delivery by the Brentwood Infrastructure Financing Authority (the “Authority”) of its Water Revenue Refunding Bonds, Series 2024 (the “2024 Bonds”), in the aggregate principal amount of $[Par Amount]. *
The Authority is a joint
exercise of powers authority organized under the laws of the State of California established by the City of Brentwood, California (the “City”) and the former Redevelopment Agency of the City of Brentwood.
The Authority was formed in 1995 to assist in the financing of various public capital improvements, including a portion of the design, acquisition and construction of additions, betterments and improvements to the City’s municipal water system (the “Water System”).
The 2024 Bonds are being issued pursuant to the Marks-Roos Local Bond Pooling Act of 1985, constituting Article 4 of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the “Act”) and a Master Trust Agreement, dated as of November 1, 2008 (the “Master Trust Agreement”), between the Authority and U.S. Bank Trust Company, National Association, successor in interest to U.S. Bank National Association, as trustee (the “Trustee”), as supplemented and amended, including as supplemented by a Third Supplemental Trust Agreement, dated as of October 1, 2024 (the “Third Supplemental Trust Agreement” and together with the Master Trust Agreement and any supplemental trust agreements, the “Trust Agreement”) between the Authority and the Trustee. The Trust Agreement permits the issuance of additional series of bonds payable from, and secured by, the Revenues on a parity with the 2024 Bonds. All such bonds, as well as the 2024 Bonds, are referred to herein as the “Bonds.” The proceeds of the sale of the 2024 Bonds will be used to (i) refund all of the Authority’s outstanding Water Revenue Refunding Bonds, Series 2014 (the “2014 Bonds”) and (ii) pay costs of issuance incurred in connection with the issuance, sale and delivery of the 2024 Bonds. See “THE PLAN OF REFUNDING” and “ESTIMATED SOURCES AND USES OF FUNDS” herein.
The 2024 Bonds are payable from, and secured by a lien on, (1) certain payments (collectively, the “2024 Payments”) received by the Authority from the City under a Master Installment Sale Agreement, dated as of November 1, 2008 (the “Master Installment Sale Agreement”) between the City and the Authority, as supplemented by a Third Supplemental Installment Sale Agreement, dated as of October 1, 2024 (the “Third Installment Sale Agreement”), together with the Master Installment Sale Agreement and any supplemental installment sale agreements, the “Installment Sale Agreement”) between the City and the Authority, and (2) from certain interest and other income derived from certain funds and accounts held under the Trust Agreement (collectively, the “Revenues”, as more fully described herein). The Master Installment Sale Agreement contemplates the incurrence of additional payments under the Installment Sale Agreement payable on a parity with, or subordinate to, the 2024 Payments. All such payments, as well as the 2024 Payments, are referred to herein as the “Payments.” The obligation of the City to make Payments is a special obligation of the City payable solely from Net Water Revenues (as defined herein), consisting primarily of all gross income and revenue received by the City from the ownership or operation of the Water System, less the maintenance and operations costs of the Water System. See “SECURITY FOR THE 2024 BONDS.”
*
Preliminary; subject to change.
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THE 2024 BONDS ARE LIMITED OBLIGATIONS OF THE AUTHORITY AND ARE
NOT SECURED BY A LEGAL OR EQUITABLE PLEDGE OF, OR CHARGE OR LIEN UPON,
ANY PROPERTY OF THE AUTHORITY OR ANY OF ITS INCOME OR RECEIPTS, EXCEPT THE REVENUES. THE FULL FAITH AND CREDIT OF NEITHER THE AUTHORITY NOR
THE CITY IS PLEDGED FOR THE PAYMENT OF THE INTEREST ON OR PRINCIPAL OF THE 2024 BONDS AND NO TAX OR OTHER SOURCE OF FUNDS, OTHER THAN THE REVENUES, IS PLEDGED TO PAY THE INTEREST ON OR PRINCIPAL OF THE 2024 BONDS. THE PAYMENT OF THE PRINCIPAL OF OR INTEREST ON THE 2024 BONDS
DOES NOT CONSTITUTE A DEBT, LIABILITY OR OBLIGATION OF THE AUTHORITY OR
THE CITY FOR WHICH ANY SUCH ENTITY IS OBLIGATED TO LEVY OR PLEDGE ANY
FORM OF TAXATION OR FOR WHICH ANY SUCH ENTITY HAS LEVIED OR PLEDGED ANY FORM OF TAXATION. THE AUTHORITY HAS NO TAXING POWER.
The summaries and references of documents, statutes, reports and other instruments referred to herein do not purport to be complete, comprehensive or definitive, and each such summary and reference is qualified in its entirety by reference to each document, statute, report, or instrument. The capitalization of any word not conventionally capitalized or otherwise defined herein, indicates that such word is defined in a particular agreement or other document and, as used herein, has the meaning given it in such agreement or document. See “APPENDIX B - SUMMARY OF PRINCIPAL LEGAL DOCUMENTS” for summaries of certain of such definitions. The proposed form of opinion of Bond Counsel is set forth in Appendix F.
THE 2024 BONDS
Description
The 2024 Bonds will be dated their date of issuance and will bear interest at the rates set forth on the inside cover page of this Official Statement, payable on January 1, 2025, and semiannually thereafter on July 1 and January 1 of each year (each, an “Interest Payment Date”). Subject to the redemption provisions set forth herein, the 2024 Bonds will mature on the dates and in the amounts set forth on the inside cover page hereof. Interest on the 2024 Bonds shall be payable in lawful money of the United States of America by check mailed by first-class mail on each interest payment date to the Holder thereof as of the close of business on the fifteenth day of the calendar month immediately preceding such interest payment date; provided, that upon the written request of a Holder of one million dollars ($1,000,000) or more in aggregate principal amount of 2024 Bonds received by the Trustee prior to the applicable Record Date (which such request shall remain in effect until rescinded in writing by such Holder), interest shall be paid by wire transfer in immediately available funds. Interest on the 2024 Bonds shall be computed on the basis of a 360-day year of twelve 30-day months. The principal of and premium, if any, on the 2024 Bonds are payable when due upon presentation thereof at the Corporate Trust Office of the Trustee, in lawful money of the United States of America.
Registration, Transfers and Exchanges
The 2024 Bonds will be executed and delivered as fully registered bonds, registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (“DTC”), and will be available to actual purchasers of the 2024 Bonds (the “Beneficial Owners”) in the denominations set forth above, under the book-entry system maintained by DTC, only through brokers and dealers who are or act through DTC Participants (as defined herein). Beneficial Owners will not be entitled to receive physical delivery of the 2024 Bonds. In the event that the book-entry-only system is no longer used with respect to the 2024 Bonds, the 2024 Bonds will be registered and transferred in accordance with the Trust Agreement. See “APPENDIX G - DTC AND THE BOOK-ENTRY SYSTEM.”
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Redemption*
Optional Redemption. The 2024 Bonds maturing on and after July 1, 20__ are subject to redemption prior to their respective stated maturities at the direction of the Authority, from any source of available funds, as a whole or in part (in such maturities as are designated by the Authority and by lot within a maturity) on any date on or after July 1, 20__, at a redemption price equal to the principal amount of the 2024 Bonds to be redeemed, together with accrued interest thereon to the date fixed for redemption, without premium.
Notice of Redemption. Notice of redemption of any 2014 Bond will be mailed by the Trustee, not less than 20 nor more than 60 days prior to the redemption date, to (i) to the respective Holders of any 2024 Bonds designated for redemption at their addresses appearing on the bond registration books of the Trustee by first-class mail, and (ii) to the Securities Depositories by facsimile and by first-class mail.
Neither the Authority nor the Trustee shall have any responsibility for any defect in the CUSIP number that appears on any 2024 Bond or in any redemption notice with respect thereto, and any such redemption notice may contain a statement to the effect that CUSIP numbers have been assigned by an independent service for convenience of reference and that neither the Authority nor the Trustee shall be liable for any inaccuracy in such CUSIP numbers. Failure by the Trustee to give notice to any one or more of the Securities Depositories or failure of any Holder or any Securities Depository to receive notice or any defect in any such notice shall not affect the sufficiency or validity of the proceedings for redemption.
Conditional Notice of Redemption. With respect to any notice of optional redemption of the 2024 Bonds, unless, upon the giving of such notice, such 2024 Bonds shall be deemed to have been paid within the meaning of the Trust Agreement, such notice shall state that such redemption shall be conditional upon the receipt by the Trustee on or prior to the date fixed for such redemption of amounts sufficient to pay the principal of, and premium, if any, and interest on, such 2024 Bonds to be redeemed, and that if such amounts shall not have been so received said notice shall be of no force and effect and the Authority shall not be required to redeem such 2024 Bonds. In the event that such notice of redemption contains such a condition and such amounts are not so received, the redemption shall not be made and the Trustee shall within a reasonable time thereafter give notice to the Holders to the effect that such amounts were not so received and such redemption was not made, such notice to be given by the Trustee in the manner in which the notice of redemption was given.
Rescission of Notice of Redemption. The Authority will have the right to rescind any optional redemption by written notice of rescission to the Trustee. The Trustee is required to mail notice of rescission of such redemption in the same manner as the original notice of redemption was sent.
Effect of Notice of Redemption. If notice of redemption has been duly given as aforesaid, and moneys for payment of the Redemption Price of, together with interest accrued to the redemption date on, the 2024 Bonds (or portions thereof) so called for redemption being held by the Trustee, on the redemption date designated in such notice, the 2024 Bonds (or portions thereof) so called for redemption shall become due and payable at the redemption price specified in such notice together with interest accrued thereon to the redemption date, interest on the 2024 Bonds so called for redemption shall cease to accrue, said 2024 Bonds (or portions thereof) shall cease to be entitled to any benefit or security and the Holders of said 2024 Bonds shall have no rights in respect thereof except to receive payment of said redemption price and accrued interest to the date fixed for redemption from funds held by the Trustee for such payment and such funds are hereby pledged to such payment. All 2024 Bonds redeemed pursuant to the Trust Agreement shall be cancelled upon surrender thereof.
* Preliminary; subject to change.
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DEBT SERVICE SCHEDULE
The amounts required to be set aside each year ending July 1 for principal and interest relating to the 2024 Bonds is as follows:
Period Ending
(July 1) Principal Interest
Total Annual
Debt Service
$ $ $
Total $ $ $
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PLAN OF REFUNDING
The Authority intends to use a portion of the proceeds of the 2024 Bonds to refund all of the outstanding 2014 Bonds (the “Refunded Bonds”). The Refunded Bonds are expected to be redeemed on January 7, 2025*(the “Redemption Date”). The 2014 Bonds were issued and delivered by the Authority in December 2014, pursuant to a Second Supplemental Trust Agreement, dated as of December 1, 2014, between the Authority and the Trustee (the “Second Supplemental Trust Agreement”), and are currently outstanding in the aggregate principal amount of $30,325,000.
The Refunded Bonds to be refunded by the 2024 Bonds are as follows:
Brentwood Infrastructure Financing Authority
Water Revenue Refunding Bonds
Series 2014
Redemption Date: January 7, 2025*
Maturity Date
(July 1)
Principal
Amount
Interest
Rate
CUSIP† No.
(10727W)
2025 $2,160,000 5.000% BP4
2026 2,260,000 5.000 BQ2
2027 1,715,000 5.000 BR0
2028 1,800,000 3.000 BS8
2029 1,855,000 4.000 BT6
2030 1,930,000 4.000 BU3
2031 2,005,000 4.000 BV1
2032 2,085,000 4.000 BW9
2033 2,165,000 4.000 BX7
2034 2,250,000 4.000 BZ2
2038
‡ 10,100,000 5.000 BY5
‡ Term Bond
Upon delivery of the 2024 Bonds, a portion of the proceeds thereof, together with other available funds of the Authority, are to be deposited into an irrevocable escrow account to be held by U.S. Bank Trust Company, National Association, as escrow agent (the “Escrow Agent”) pursuant to an Escrow Agreement, dated as of October 1, 2024 between the Authority and the Escrow Agent (the “Escrow Agreement”). The funds deposited to such escrow account are to be held in cash or used to purchase direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America, scheduled to mature on or before the Redemption Date. Upon delivery of the 2024 Bonds, the arithmetical accuracy of certain computations relating to the defeasance of the Refunded Bonds will be verified by [Verification Agent]. See “VERIFICATION” below. Amounts held by the Escrow Agent pursuant to the Escrow Agreement will not be available for the payment of debt service on the 2024 Bonds.
* Preliminary; subject to change.
† CUSIP® is a registered trademark of the American Bankers Association. CUSIP data herein are provided by CUSIP Global Services, managed by FactSet Research Systems Inc. on behalf of the American Bankers Association. CUSIP numbers have been assigned by an independent company and are included solely for the convenience of the holders of the Prior Bonds. None of the Authority or the City or their agents or counsel assume responsibility for the accuracy of such numbers.
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ESTIMATED SOURCES AND USES OF FUNDS
The following sets forth the estimated sources and uses of funds related to the 2024 Bonds.
Sources of Funds
Principal Amount of 2024 Bonds $
[Plus/Less] [Net] Original Issue
[Premium/Discount]
Amounts related to Refunded Bonds
Total Sources of Funds $
Uses of Funds
Escrow Fund for Refunded Bonds $
Costs of Issuance(1)
Total Uses of Funds $
____________________
(1) Includes legal fees, printing costs, escrow agent, verification agent, rating agency fees, underwriter’s discount and other miscellaneous expenses.
(Remainder of Page Intentionally Left Blank)
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SECURITY FOR THE 2024 BONDS
Trust Agreement
The 2024 Bonds and all other Bonds issued and Outstanding (collectively, the “Bonds”) under the Trust Agreement and the interest thereon are payable solely from, and are secured by a lien on Revenues, which are defined in the Trust Agreement as all payments received by the Authority from the City under the Installment Sale Agreement and certain interest, and other income derived from certain funds held under the Trust Agreement.
All Revenues and any other amounts (including proceeds of the sale of the Bonds) held by the Trustee in any fund or account established under the Trust Agreement (other than amounts on deposit in the Rebate Fund created pursuant to the Trust Agreement) are irrevocably pledged under the Trust Agreement to the payment of the interest and premium, if any, on and principal of the Bonds as provided therein, and the Revenues may not be used for any other purpose while any of the Bonds remain Outstanding; provided, however, that out of the Revenues and other moneys there may be applied such sums for such purposes as are permitted under the Trust Agreement. This pledge constitutes a first pledge of and charge and lien upon the Revenues and all other moneys on deposit in the funds and accounts established under the Trust Agreement (other than amounts on deposit in the Rebate Fund) for the payment of the interest on and principal of the Bonds in accordance with the terms of the Bonds and the Trust Agreement. In the Trust Agreement, the Authority assigns to the Trustee all of the Authority’s rights and remedies under the Installment Sale Agreement.
In the Trust Agreement, the Authority has agreed that all Revenues when and as received shall be deposited when and as received by the Authority in the Revenue Fund created pursuant to the Trust Agreement and maintained with the Trustee. Subject to the Trust Agreement, all money in the Revenue Fund shall be set aside by the Trustee in the following respective special accounts within the Revenue Fund in the following order of priority:
(a) Interest Account,
(b) Principal Account; Sinking Accounts,
(c) Reserve Fund, and
(d) Fees and Expenses Fund.
All money in each of such accounts will be held in trust by the Trustee and will be applied, used and withdrawn only for the purposes authorized in the Trust Agreement.
Interest Account. Not later than each Interest Payment Date, the Trustee shall set aside from the Revenue Fund and deposit in the Interest Account that amount of money which is equal to the aggregate amount of interest becoming due and payable on the Outstanding Current Interest Bonds (as defined in the Trust Agreement) on such Interest Payment Date (excluding any interest for which there are moneys deposited in the Interest Account from the proceeds of any Series of Bonds or other source and reserved as capitalized interest to pay such interest). On January 1 and July 1 of each year any excess amounts in the Interest Account not needed to pay interest on such date (and not held to pay interest on Bonds having Interest Payment Dates other than January 1 and July 1) shall be transferred to the Authority (but excluding, in each case, any moneys on deposit in the Interest Account from the proceeds of any Series of Bonds or other source and reserved as capitalized interest to pay interest on any future Interest Payment
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Dates following such Interest Payment Dates). All Swap Revenues received shall be deposited in the Interest Account.
Principal Account; Sinking Accounts. Not later than each date that any Bond Obligation or Mandatory Sinking Account Payment is scheduled to become due and payable, the Trustee will deposit in the Principal Account an amount equal to (i) the aggregate amount of Bond Obligation becoming due and payable on such date, plus (ii) the aggregate of the Mandatory Sinking Account Payments to be paid on such date into the respective Sinking Accounts for the Term Bonds of all Series. All of the aforesaid deposits made in connection with Mandatory Sinking Account Payments shall be made without priority of any payment into any one such Sinking Account over any other such payment.
In the event that the Revenues are not sufficient to make the required deposits so that moneys in the Principal Account on any one date are equal to the amount of Bond Obligation to become due and payable on the Outstanding Serial Bonds of all Series plus the Bond Obligation amount of and redemption premium on the Outstanding Term Bonds required to be redeemed or paid at maturity on such date, then such moneys will be applied on a Proportionate Basis and in such proportion as said Serial Bonds and said Term Bonds shall bear to each other, after first deducting for such purposes from said Term Bonds any of said Term Bonds as shall have been redeemed or purchased during the preceding 12- month period. In the event that the Revenues are not be sufficient to pay in full all Mandatory Sinking Account Payments required to be paid at any one time into all such Sinking Accounts, then payments into all such Sinking Accounts will be made on a Proportionate Basis, in proportion that the respective Mandatory Sinking Account Payments required to be made into each Sinking Account during the then current 12-month period bear to the aggregate of all of the Mandatory Sinking Account Payments required to be made into all such Sinking Accounts during such 12-month period.
On July 1 of each year or as soon as practicable thereafter any excess amounts in the Principal Account not needed to pay principal on such date (and not held to pay principal on Bonds having principal payment dates other than July 1) will be transferred to the Authority.
Reserve Fund. Upon the occurrence of any deficiency in any Reserve Fund, the Trustee shall make such deposit to such Reserve Fund as is required pursuant to the Trust Agreement, each such deposit to be made as soon as possible in each month, until the balance therein is at least equal to the applicable Reserve Requirement. No Reserve Fund is being established for the 2024 Bonds.
Fees and Expenses Fund. The Trustee shall establish, maintain and hold in trust a separate fund designated as the “Fees and Expenses Fund.” At the direction of the Authority, after the transfers required by the Trust Agreement have been made, the Trustee shall deposit as soon as practicable in each month in the Fees and Expenses Fund amounts necessary for payment of fees, expenses and similar charges (including fees, expenses and similar charges relating to any Liquidity Facility or Credit Enhancement for the Bonds owing in such month or following month by the Authority in connection with the Bonds. The Authority shall inform the Trustee of such amounts, in writing, on or prior to the first Business Day of each month.
Any Revenues remaining in the Revenue Fund after the foregoing transfers described in the Trust Agreement, except as the Authority shall otherwise direct in writing or as is otherwise provided in a Supplemental Trust Agreement, shall be transferred to the Authority on the same Business Day or as soon as practicable thereafter. The Authority may use and apply the Revenues when received by it for any lawful purpose of the Authority, including the redemption of Bonds upon the terms and conditions set forth in the Supplemental Trust Agreement relating to such Bonds and the purchase of Bonds as and when and at such prices as it may determine.
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Installment Sale Agreement and Pledge of Net Water Revenues 2024 Payments. The City is obligated to make the 2024 Payments, but solely from Net Water Revenues, which are defined in the Installment Sale Agreement as, for any Fiscal Year or twelve calendar month period, the Water Revenues during such Fiscal Year or twelve calendar month period less the Maintenance and Operation Costs during such Fiscal Year or twelve calendar month period. “Water Revenues” means, for any Fiscal Year or twelve calendar month period all income and revenue received or receivable by the City during such Fiscal Year or twelve calendar month period from the ownership or operation of the Water System, determined in accordance with generally accepted accounting principles, including:
all rates, fees and charges (including connection fees and charges) received by the City for the Water Service and the other services of the Water System, all proceeds of insurance covering business interruption loss relating to the Water System, all connection fees and charges payable to the City for the Water Service made available or provided by the Water System,
all payments for the lease of property comprising a part of the Water System, all other income and revenue howsoever derived by the City from the ownership or operation of the Water System or arising from the Water System;
and also including all Payment Agreement Receipts (as such term is defined in the Installment Sale Agreement), and including all income from the investment of amounts on deposit in the Water Revenue Fund, the Parity Obligation Fund and the Rate Stabilization Fund, but excluding in all cases any proceeds of taxes and any refundable deposits made to establish credit and any advances or contributions in aid of construction and excluding any income from the investment of amounts on deposit in the Improvement Fund and excluding any earnings of a separate utility system acquired and constructed by the City pursuant to the Installment Sale Agreement. Notwithstanding the foregoing, there shall be deducted from Water Revenues any amounts transferred into the Rate Stabilization Fund as contemplated by the Installment Sale Agreement, and there shall be added to Water Revenues any amounts transferred out of the Rate Stabilization Fund as contemplated by the Installment Sale Agreement. “Maintenance and Operation Costs” generally means, for any Fiscal Year or twelve calendar month period, all reasonable and necessary costs paid or incurred by the City during such Fiscal Year or twelve calendar month period, for maintaining and operating the Water System, determined in accordance with generally accepted accounting principles, including all reasonable expenses of management and repair and other expenses necessary to maintain and preserve the Water System in good repair and working order, but excluding in all cases depreciation, replacement and obsolescence charges or reserves therefor and amortization of intangibles.
The obligation of the City to pay the Payments from Net Water Revenues is absolute and unconditional, and until such time as the Payments have been paid in full (or provision for the payment thereof shall have been made pursuant to the Trust Agreement), the City will not discontinue or suspend any Payments required to be paid by it under the Installment Sale Agreement when due, whether or not the Water System or any part thereof is operating or operable, or its use is suspended, interfered with, reduced, curtailed or terminated in whole or in part, and such payments will not be subject to reduction
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whether by offset or otherwise and will not be conditional upon the performance or nonperformance by any party to any agreement for any cause whatsoever.
Pursuant to the Installment Sale Agreement, the City has irrevocably granted and pledged the Net Water Revenues first, to secure Parity Obligations and second, to secure Subordinate Obligations; provided that out of Net Water Revenues there may be apportioned such sums for such purposes as are expressly permitted by the Installment Sale Agreement. The City covenants in the Installment Sale Agreement to deposit all Water Revenues received by it in the City of Brentwood Water Revenue Fund (the “Water Revenue Fund”). Moneys in the Water Revenue Fund will be used only in the following order:
(A) to pay all Maintenance and Operation Costs (including amounts reasonably required to be set aside in contingency reserves for Maintenance and Operation Costs the payment of which is not then immediately required) as they become due and payable. (B) on or before the fifth day before the last Business Day in each month, the Treasurer, Director of Finance & Information Systems of the City (the “Director of Finance”) shall, from the remaining money then on deposit in the Water Revenue Fund, deposit in the “City of Brentwood Parity Obligation Payment Fund,” which fund the Director of Finance agrees to hold and maintain so long as any Parity Payments due under the Installment Sale Agreement shall be Outstanding the following amounts in the following order of priority:
(1) a sum equal to (a) the interest and principal payments becoming due and payable under all Supplemental Installment Sale Agreements that are Parity Obligations, plus (b) the net payments becoming due and payable on all Parity Payment Agreements (except any Termination Payments), plus (c) any other amounts with respect to Parity Obligations (including any letter of credit and remarketing fees), in each case, during the next succeeding month; plus
(2) (unless otherwise covered by subparagraph (B)(1) above) a sum equal to (a) one-sixth (1/6) of the amount of interest becoming due and payable under all Supplemental Installment Sale Agreements that are Parity Obligations on the next succeeding Interest Payment Date, plus (b) one-twelfth (1/12) of the amount of principal becoming due and payable under all Supplemental Installment Sale Agreements that are Parity Obligations on the next succeeding Principal Payment Date, except that no such deposit need be made if the Director of Finance then holds money in the Parity Obligation Payment Fund equal to the amount of interest becoming due and payable under all Supplemental Installment Sale Agreements that are Parity Obligations on the next succeeding Interest Payment Date plus the amount of principal becoming due and payable under all Supplemental Installment Sale Agreements that are Parity Obligations on the next succeeding Principal Payment Date plus the net payments due on all Parity Payment Agreements on such dates (except any Termination Payments) plus any other amounts becoming due and payable with respect to Parity Obligations (including any letter of credit and remarketing fees); plus
(3) all amounts due to make up any deficiency in the Reserve Funds and Reserve Accounts for Parity Obligations in accordance with the provisions of the applicable Issuing Document, including all Reserve Fund Credit Facility Costs.
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All money on deposit in the Parity Obligation Payment Fund shall be transferred by the Director of Finance to the Trustee or other third party payee thereof to make and satisfy the Parity Payments due on the next applicable Payment Dates. (C) to make such deposits in the Rate Stabilization Fund as the City may determine from time to time in accordance with the Installment Sale Agreement.
After the payments contemplated by subparagraphs (A), (B) and (C) above have been made, any amounts remaining in the Water Revenue Fund may from time to time be used for the payment of the interest and principal payments becoming due and payable under all Supplemental Installment Sale Agreements that are Subordinate Obligations; so long as certain conditions are met, including that all Maintenance and Operations Costs are being and have been paid and are then current.
After the required deposits have been made, any amounts thereafter remaining in the Water Revenue Fund may be used for any lawful purpose, including, but not limited to the payment of any Termination Payments on all Subordinate Payment Agreements.
Water Rate Covenant; Collection of Water Rates and Charges. The City covenants under the Installment Sale Agreement to fix, prescribe and collect rates, fees and charges for the Water Service during each Fiscal Year which are reasonably fair and nondiscriminatory and which are estimated to yield Adjusted Annual Net Water Revenues for such Fiscal Year equal to the Coverage Requirement (as defined herein). The City may make adjustments from time to time in such rates, fees and charges and may make such classification thereof as it deems necessary, but covenants not to reduce the rates, fees and charges then in effect unless the Adjusted Annual Net Water Revenues from such reduced rates, fees and charges are estimated to be sufficient to meet the requirements described in this paragraph.
The City further covenants to have in effect at all times rules and regulations requiring each consumer or customer located on any premises connected with the Water System to pay the rates, fees and charges applicable to the Water Service to such premises and providing for the billing thereof and for a due date and a delinquency date for each bill. The City will not permit any part of the Water System or any facility thereof to be used or taken advantage of free of charge by any corporation, firm or person, or by any public agency (including the United States of America, the State of California and any city, county, district political subdivision, public corporation or agency of any thereof); provided, that the City may without charge use the Water System.
Issuance of Parity Obligations. Under the terms of the Installment Sale Agreement, the City may at any time execute any obligations payable on a parity with the 2024 Payments (“Parity Obligations”), provided certain conditions are met, including that the City has demonstrated that, during the last audited Fiscal Year or any twelve calendar month period during the immediately preceding eighteen calendar month period, the Adjusted Annual Net Water Revenues were at least equal to the Coverage Requirement for all Outstanding Supplemental Installment Sale Agreements plus the Parity Obligation proposed to be executed. Additionally, in connection with the execution of Parity Obligations, the City must deliver a certificate stating during the last audited Fiscal Year, Adjusted Annual Net Water Revenues were equal to at least one hundred percent (100%) of Maximum Annual Debt Service calculated for all Outstanding Parity Obligations and all proposed additional Parity Obligations. “Coverage Requirement” means, for any Fiscal Year or 12 calendar month period, (1) an amount of Adjusted Annual Net Water Revenues equal in each case to at least:
12 4139-2785-0833.3
(i) 125% of the Adjusted Annual Debt Service for such Fiscal Year or 12 calendar month period,
(ii) 110% of the sum of the Adjusted Annual Debt Service plus the Adjusted Subordinate Annual Debt Service for such Fiscal Year or twelve (12) calendar month period, and
(iii) 100% of all obligations of the City payable in such Fiscal Year or 12 calendar month period;
(2) an amount of Net Operating Revenues equal to at least 100% of all obligations of the City payable in such Fiscal Year or 12 calendar month period; provided, that for purposes of determining compliance with the Coverage Requirement, certain specific provisions with respect to variable rate and other types of debt instruments apply. See “APPENDIX B – SUMMARY OF PRINCIPAL LEGAL DOCUMENTS – Certain Definitions of the Master Installment Agreements – Coverage Requirement.”
Additionally, instead of meeting the requirements described above, the City may also enter into Parity Obligations if it receives an Engineer’s Report to the effect that that the estimated Adjusted Annual Net Water Revenues for each of the five (5) Fiscal Years next following the earlier of (i) the end of the period during which interest on the Parity Obligation proposed to be entered into is to be capitalized or, if no interest is capitalized, the Fiscal Year in which the Parity Obligation proposed to be entered into is executed, or (ii) the date on which substantially all Water Projects financed with the Parity Obligation proposed to be entered into plus all Water Projects financed with all existing Supplemental Installment Sale Agreements are expected to commence operations, will be at least equal to the Coverage Requirement for such period.
Certain allowances for adjustments to Net Water Revenues from new connections to the Water System or any increase in the rates, fees and charges fixed and prescribed for Water Service which became effective prior to the issuance of Parity Obligations are permitted under the Installment Sale Agreement. See “APPENDIX B – SUMMARY OF PRINCIPAL LEGAL DOCUMENTS – CERTAIN PROVISIONS OF THE MASTER INSTALLMENT SALE AGREEMENT – Parity Obligations” Notwithstanding the foregoing, there are no limitations on the ability of the City to enter into any Parity Obligation at any time to refund any outstanding Obligation which results in a net present value savings to the City, inclusive of all costs of such refunding.
Issuance of Subordinate Obligations. The City may at any time enter into any Subordinate Obligations payable as provided in the Installment Sale Agreement; provided that no Event of Default (as defined in the Installment Sale Agreement) has occurred and is continuing and the provisions relating to the conditions for the execution of Parity Obligations are satisfied for the execution of such Subordinate Obligation, assuming that the Coverage Requirement is met. See “Issuance of Parity Obligations” above.
Nothing contained in the Installment Sale Agreement shall limit the ability of the City to enter into obligations payable from a lien on Net Water Revenues that is subordinate both to the lien of Net Water Revenues that secures the 2024 Payments and any Parity Obligations and the lien of Net Water Revenues that secures any Subordinate Obligations.
Rate Stabilization Fund. The Installment Sale Agreement establishes the City of Brentwood Water Rate Stabilization Fund (the “Rate Stabilization Fund”), which fund the Director of Finance will
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hold and maintain as directed by the City so long as any Payments are due under the Installment Sale Agreement. The City may at any time deposit in the Rate Stabilization Fund any Net Water Revenues and any other money available to be used therefor, the City may at any time withdraw from the Rate Stabilization Fund any money therein for deposit in the Water Revenue Fund and the City shall withdraw from the Rate Stabilization Fund any money therein for deposit in the Water Revenue Fund in the event there are insufficient amounts in the Water Revenue Fund to make the deposits and transfers required by the Installment Sale Agreement; provided, that any such deposits or withdrawals may be made up to and including the date that is one hundred eighty (180) days after the end of the Fiscal Year or twelve (12) calendar month period for which such deposit or withdrawal will be taken into account in determining Adjusted Annual Water Revenues; and provided further, that no deposit of Net Water Revenues shall be made into the Rate Stabilization Fund to the extent that such deposit would prevent the City from meeting the Coverage Requirement in any Fiscal Year or twelve (12) calendar month period.
THE AUTHORITY
The Authority was created by a Joint Exercise of Powers Agreement, dated as of March 14, 1995 between the City and the former Redevelopment Agency of the City of Brentwood. The agreement was entered into pursuant to the provisions of Articles 1, 2 and 4, Chapter 5, Division 7, Title 1 of the California Government Code. The Authority is empowered to assist in financing projects and certain public improvements, such as the design, acquisition and construction of additions, betterments and improvements to the Water System. Under the Act, the Authority has the power to issue revenue bonds to assist in the financing of public capital improvements, and to refund bonds previously issued under the Act.
THE WATER SYSTEM
See Appendix A for information concerning the operations and finances of the Water System.
RISK FACTORS
The following section describes certain risk factors affecting the payment of and security for the 2024 Bonds. The following discussion of risks is not meant to be an exhaustive list of the risks associated with the purchase of the 2024 Bonds and does not necessarily reflect the relative importance of the various issues. Potential investors are advised to consider the following factors, along with all other information in this Official Statement, in evaluating the 2024 Bonds. There can be no assurance that other risk factors will not become material in the future.
General
The payment of principal of and interest on the 2024 Bonds is secured solely by a pledge of the Revenues and certain funds under the Trust Agreement. The realization of the Revenues is subject to, among other things, the capabilities of management of the City, the ability of the City to provide water services to its users, and the ability of the City to establish and maintain water fees and charges sufficient to provide the required debt service coverage as well as pay for maintenance and operation costs.
The ability of the City to comply with its covenants under the Installment Sale Agreement and to generate Net Water Revenues sufficient to pay the 2024 Payments and, therefore, debt service on the 2024 Bonds may be adversely affected by actions and events outside the control of the City and may be adversely affected by actions taken (or not taken) by voters, property owners, taxpayers or persons obligated to pay fees and charges. Among other matters, drought, general and local economic conditions and changes in law and government regulations (including initiatives and moratoriums on growth) could
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adversely affect the amount of Net Water Revenues realized by the City or significantly raise the cost of operating and maintaining the Water System.
Rate Covenant Not a Guarantee
The ability of the City to pay the 2024 Payments depends on the ability of the City to generate Net Water Revenues in the levels required by the Installment Sale Agreement. Although the City has covenanted in the Installment Sale Agreement to impose rates, fees and charges as more particularly described herein under “SECURITY FOR THE 2024 BONDS – Installment Sale Agreement and Pledge of Net Water Revenues – Water Rate Covenant; Collection of Water Rates and Charges,” and expects that sufficient Water Revenues will be generated through the imposition and collection of such rates, fees and charges and other Water Revenues described herein, there is no assurance that such imposition of such rates, fees and charges or other Water Revenues will result in the generation of Net Water Revenues in the amounts required by the Installment Sale Agreement. The City’s covenant does not constitute a guarantee that sufficient Net Water Revenues will be available to pay the 2024 Payments.
Proposition 218 and Proposition 26
On November 5, 1996, the voters of the State approved Proposition 218, known as the “Right to Vote on Taxes Act.” Proposition 218 added Articles XIIIC and XIIID to the California Constitution, which contain a number of provisions affecting the ability of local governments, including the City, to levy and collect both existing and future taxes, assessments, fees and charges.
Article XIIID imposes substantive and procedural requirements on the imposition, extension or increase of any “fee” or “charge” subject to its provisions. A “fee” or “charge” subject to Article XIIID includes any levy, other than an ad valorem tax, special tax or assessment, imposed by an agency upon a parcel or upon a person as an incident of property ownership. Article XIIID prohibits, among other things, the imposition of any proposed fee or charge, and, possibly, the increase of any existing fee or charge, in the event written protests against the proposed fee or charge are presented at a required public hearing on the fee or charge by a majority of owners of the parcels upon which the fee or charge is to be imposed.
Except for fees and charges for water, sewer and refuse collection services, the approval of a majority of the property owners subject to the fee or charge, or at the option of the agency, by two-thirds vote of the electorate residing in the affected area, is required not less than 45 days following the public hearing on any such proposed new or increased fee or charge.
In addition to the procedural requirements of Article XIIID, under Article XIIID all property related fees and charges, including those which were in existence prior to the passage of Proposition 218 in November 1996, must meet the following substantive standards: (i) the revenues derived from the fee or charge cannot exceed the funds required to provide the property-related service; (ii) the revenues derived from the fee or charge must not be used for any purpose other than that for which the fee or charge was imposed; (iii) the amount of a fee or charge imposed upon any parcel or person as an incident of property ownership must not exceed the proportional cost of the service attributable to the parcel; (iv) no fee or charge may be imposed for a service unless that service is actually used by, or immediately available to, the owner of the property in question, fees or charges based on potential or future use of a service are not permitted, and standby charges, whether characterized as charges or assessments, must be classified as assessments and cannot be imposed without compliance with Section 4 of Article XIIID (relating to assessments); and (v) no fee or charge may be imposed for general governmental services including, but not limited to, police, fire, ambulance or library services where the service is available to the public at large in substantially the same manner as it is to property owners.
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The California Supreme Court decisions in Richmond v. Shasta Community Services District, 32 Cal. 4th 409 (2004) (“Richmond”), and Bighorn Desert View Water Agency v. Verjil, 39 Cal. 4th 206 (2006) (“Bighorn”) have clarified uncertainty surrounding the applicability of Section 6 of Article XIIID to service fees and charges. In Richmond, the Shasta Community Services District charged a water connection fee, which included a capacity charge for capital improvements to the water system and a fire suppression charge. The Court held that both the capacity charge and the fire suppression charge were not subject to Article XIIID because a water connection fee is not a property related fee or charge because it results from the property owner’s voluntary decision to apply for the connection. In both Richmond and Bighorn, however, the Court stated that a fee for ongoing water service through an existing connection is imposed “as an incident of property ownership” within the meaning of Article XIIID, rejecting, in Bighorn, the water agency’s argument that consumption based water charges are not imposed “as an incident of property ownership” but as a result of the voluntary decisions of customers as to how much water to use.
The City believes that its water rates have been developed and adopted in accordance with the requirements of Article XIIID described above.
Article XIIIC extends the people’s initiative power to reduce or repeal previously authorized local taxes, assessments, fees and charges. This extension of the initiative power is not limited by the terms of Article XIIIC to fees, taxes, assessment fees and charges imposed after November 6, 1996 and absent other authority could result in retroactive reduction in any existing taxes, assessments, fees or charges. In Bighorn, the Court concluded that under Article XIIIC local voters by initiative may reduce a public agency’s water rates and delivery charges. The Court noted, however, that it was not holding that the authorized initiative power is free of all limitations, stating that it was not determining whether the electorate’s initiative power is subject to the public agency’s statutory obligation to set water service charges at a level that will “pay the operating expenses of the agency, … provide for repairs and depreciation of works, provide a reasonable surplus for improvements, extensions, and enlargements, pay the interest on any bonded debt, and provide a sinking or other fund for the payment of the principal of such debt as it may become due.”
The courts have not fully interpreted the provisions of Proposition 218. The City is unable to predict how courts will further interpret Article XIIIC and Article XIIID, and what, if any, further implementing legislation will be enacted. Under the Bighorn case, City voters could adopt an initiative measure that reduces or repeals the City’s water rates and charges, though it is not clear whether (and courts have not decided whether) any such reduction or repeal by initiative would be enforceable in a situation in which such rates and charges are pledged to the repayment of bonded indebtedness. There can be no assurance that the courts will not further interpret, or the voters will not amend, Article XIIIC and Article XIIID to limit the ability of the City to impose, levy, charge and collect increased fees and charges for the Water System, or to call into question water rate increases previously adopted by the City. No assurance may be given that Articles XIIIC and XIIID will not have a material adverse impact on Net Water Revenues or the payment of debt service on the 2024 Bonds.
Proposition 26, which amended Article XIIIA and XIIIC of the California Constitution, was approved by the electorate at the November 2, 2010 election. Proposition 26 imposes a two-thirds voter approval requirement for the imposition of fees and charges by the State. It also imposes a majority voter approval requirement on local governments with respect to fees and charges for general purposes, and a two-thirds voter approval requirement with respect to fees and charges for special purposes. According to its supporters, Proposition 26 was designed to prevent the circumvention of tax limitations imposed by the voters pursuant to Proposition 13, approved in 1978, Proposition 218, and other measures through the use of non-tax fees and charges.
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Proposition 26 expressly excludes from its scope “a charge imposed for a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable cost to the governmental entity of providing the service or product to the payor” and “assessments and property related fees imposed in accordance with the provisions of Article XIIID.” The California Supreme Court has held that a fee for ongoing water service through an existing connection is imposed “as an incident of property ownership” within the meaning of Article XIIID. See “– Proposition 218.” The City believes that Proposition 26 is not intended to, and would not, apply to fees for water deliveries and services charged by the City. The City, however, is unable to predict how Proposition 26 will be interpreted by the courts to apply to the provision of water services by local governments such as the City.
Initiatives; Changes in Law
In recent years several initiative measures have been proposed or adopted which affect the ability of local governments to increase taxes and rates. Article XIIIA, Article XIIIB, Article XIIIC, and Article XIIID of the California Constitution and Proposition 26, were adopted as measures that qualified for the ballot through California’s initiative process. From time to time, other initiative measures could be adopted, which may place further limitations on the ability of the State, the City or local districts to increase revenues or to increase appropriations which may affect the City’s revenues or its ability to expend its revenues. There is no assurance that the electorate or the State Legislature will not at some future time approve additional limitations which could affect the ability of the City to implement rate increases which could reduce Net Water Revenues and adversely affect the security for the 2024 Bonds.
System Demand
There can be no assurance that the demand for water services will occur as described in this Official Statement. Reduction in levels of demand could require an increase in rates or charges in order to comply with the rate covenant. Such increases could be material.
System Expenses and Capital Costs
There can be no assurance that the City’s projected expenses or capital costs will be consistent with the descriptions in this Official Statement. Increases in expenses and/or capital costs including, but not limited to, personnel costs (including pension and other benefits), regulatory compliance costs and changes in technology, could require an increase in rates or charges in order to comply with the rate covenant. Such increases could be material.
Earthquakes, Floods and Other Natural Disasters
The potential for natural disasters to cause catastrophic damage to any urban area, including above-ground and below-ground water infrastructure, is great. Earthquakes, floods, fires or other natural disasters could interrupt operation of the Water System and cause increased costs or reductions in revenues and thereby interrupt the ability of the City to realize Net Water Revenues. The City is not obligated under the Installment Sale Agreement to have earthquake or flood insurance.
Water Supply and Drought
The ability of the Water System to operate effectively is affected by the water supply available to the City. If water supply decreases significantly, whether by drought, operation of mandatory supply restrictions, prohibitively high water costs or otherwise, Water System sales may diminish and Net Water Revenues available to pay debt service on the 2024 Bonds may be adversely affected. While the City has plans and
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manages reserve supplies to account for normal occurrences of drought conditions, in recent years the State has experienced severe drought conditions. The drought in California from 2020 to 2022 represents the driest three-year period on record. Following the second driest year on record and with near record low storage in California’s largest reservoirs, Governor Newsom declared a statewide drought emergency in October 2021 and called for voluntary statewide water use reductions of 15% compared to 2020 water use. In August 2021, the State Water Resources Control Board (“State Water Board”) adopted emergency regulations for curtailing water diversions in the Bay-Delta tributaries. In March 2022, Governor Newsom issued an executive order directing the State Water Board to adopt emergency regulations requiring each urban water supplier that has submitted a water shortage contingency plan to the California Department of Water Resources to implement, at a minimum, shortage response actions for a shortage level of up to 20%, which the State Water Board adopted in May 2022. California’s remarkably wet winter in late 2022 and early 2023 has eased drought conditions considerably. Accordingly, in March 2023, Governor Newsom rescinded some of the State’s drought restrictions and the State Water Board rescinded its curtailment regulations on April 3, 2023.
The City has developed six stages of action to be taken in response to water supply shortages.
See APPENDIX A – “INFORMATION RELATING TO THE WATER SYSTEM – Water Supply Shortages.” The City is currently at Shortage Level 1, which is the normal level not indicative of drought conditions but pursuant to which the City encourages water conservation by the City’s customers.
Nevertheless, future droughts could result in additional or similar mandatorily enforced conservation measures and other mitigations that could have a material adverse impact on Net Water Revenues available to pay debt service on the 2024 Bonds.
Climate Change
The change in the earth’s average atmospheric temperature, generally referred to as “climate change”, is expected to, among other things, increase the frequency and severity of extreme weather events, such as floods, fires and droughts. Climate change is anticipated to have an impact on water demands and supplies. Reductions of snowpack, earlier snowmelt runoff, and more frequent and longer periods of drought would reduce water supply reliability. As described above, the City has developed six stages of action to be taken in response to water supply shortages, including those due to climate change.
Nevertheless, the effects of climate change could have a material adverse impact on the operations of the Water System and the Net Water Revenues available to pay debt service on the 2024 Bonds.
Pandemics; COVID-19 Pandemic
A pandemic, epidemic or outbreak of an infectious disease can have significant adverse health and financial impacts on global and local economies. For example, the COVID-19 pandemic resulted in prolonged stay-at-home orders that significantly impacted the City, including the Water System. In addition to certain direct impacts on the operations and finances of the Water System, COVID-19 has had significant and varied impacts on general economic activity at the local, national and global levels, including supply chain and labor market disruptions. Such disruptions have, among other effects, resulted in increases in materials, labor, transportation and other costs across a wide number of sectors, as well as delays in delivery of projects and equipment. The Water System has experienced, and may in the future experience, increases in certain costs and delays in the delivery of equipment as a result of COVID-19’s disruption of supply chains. Additionally, such disruptions may result in schedule delays for the Water System’s capital projects or increased costs for such projects. The effects of a future pandemic, epidemic or outbreak of an infectious disease could materially adversely affect the operations of the Water System and the Net Water Revenues available to pay debt service on the 2024 Bonds.
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Cybersecurity
The City relies on a large and complex technology environment to conduct its operations. The City faces multiple cyber threats including, but not limited to, hacking, viruses, malware and other attacks on computers and other sensitive digital networks and systems. [There have been, however, only limited cyber-attacks on the City’s systems.] No assurances can be given that the City’s security and operational control measures will be successful in guarding against any and each cyber threat and attack. The results of any attack on the City’s computer and information technology systems could impact its operations and damage the City’s digital networks and systems, and the costs and/or impacts on operation resulting therefrom could be material.
Physical Security
The occurrence of military conflicts and terrorist activities could adversely impact the operations of the Water System and the Net Water Revenues available to pay debt service on the 2024 Bonds. The City plans and prepares for emergency situations. However, there can be no assurance that any existing or additional safety and security measures will prove adequate in the event that military conflicts or terrorist activities are directed against the assets of the Water System or that costs of security measures will not be greater than presently anticipated.
Permits and Regulation
The water operations of the City are subject to permits from state regulatory agencies. Noncompliance with such permits may result in significant penalties from such state agencies or other enforcement actions that could have a material adverse effect on the finances and operations of the City.
The kind and degree of water treatment and water quality effected through the Water System is regulated, to a large extent, by the federal government and/or the State of California. In the event that the federal government, acting through the Environmental Protection Agency, or the State of California, acting through the Department of Health Services, or additional federal or state agencies, should impose stricter water quality standards upon the Water System, the City’s expenses could increase accordingly and rates and charges would have to be increased to offset those expenses. It is not possible to predict the direction federal or state regulation will take with respect to water quality or treatment standards, although it is likely that, over time, both will impose more stringent standards with attendant higher costs.
Investment of Funds
All funds and accounts held under the Trust Agreement are required to be invested in Permitted Investments as provided under the Trust Agreement. See APPENDIX B attached hereto for a summary of the definition of Permitted Investments. All investments, including the Permitted Investments and those authorized by law from time to time for investments by public agencies, contain a certain degree of risk. Such risks include, but are not limited to, a lower rate of return than expected, loss of market value and loss or delayed receipt of principal. The occurrence of these events with respect to amounts held under the Trust Agreement or by the City, including but not limited to amounts in the Rate Stabilization Fund, could have a material adverse effect on the security for the 2024 Bonds.
Limitations on Remedies and Bankruptcy
The ability of the City to comply with its covenants under the Installment Sale Agreement and to generate Net Water Revenues sufficient to make the 2024 Payments may be adversely affected by actions and events outside of the control of the City and may be adversely affected by actions taken (or not taken)
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by voters, property owners, taxpayers or persons obligated to pay assessments, fees and charges. See “— Proposition 218.” Failure by the City to pay the 2024 Payments required to be made under the Installment Sale Agreement constitutes an event of default under the Installment Sale Agreement and the Trustee is permitted to pursue remedies at law or in equity to enforce the City’s obligation to make such 2024 Payments.
The rights and remedies provided in the Trust Agreement and the Installment Sale Agreement may be limited by and are subject to bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws affecting creditors’ rights, to the application of equitable principles if equitable remedies are sought, and to the exercise of judicial discretion in appropriate cases and to limitations on legal remedies against public agencies in the State of California. The various opinions of counsel to be delivered with respect to such documents, including the opinion of Bond Counsel (the form of which is attached as APPENDIX F), will be similarly qualified.
The enforcement of the remedies provided in the Trust Agreement and the Installment Sale Agreement could prove both expensive and time consuming. In addition, the rights and remedies provided in the Trust Agreement and the Installment Sale Agreement may be limited by and are subject to provisions of the federal bankruptcy laws, as now or hereafter enacted, and to other laws or equitable principles that may affect creditors’ rights. If the City were to file a petition under chapter 9 of the United States Bankruptcy Code (Title 11, United States Code) (the “Bankruptcy Code”), the Bondholders and the Trustee could be prohibited or severely restricted from taking any steps to enforce their rights under the Installment Sale Agreement.
To the extent that the Net Water Revenues are “special revenues” under the Bankruptcy Code, then Net Water Revenues collected after the date of the bankruptcy filing should be subject to the lien of the Installment Sale Agreement. If any or all of the Net Water Revenues are determined not to be “special revenues,” then any such amounts collected after the commencement of the bankruptcy case will likely not be subject to the lien of the Installment Sale Agreement. The holders of the 2024 Bonds may not be able to assert a claim against any property of the City other than the Net Water Revenues, and if any or all of the Net Water Revenues are no longer subject to the lien of the Installment Sale Agreement, then there may be limited, if any, funds from which the holders of the 2024 Bonds are entitled to be paid.
The Bankruptcy Code provides that “special revenues” can be applied to necessary operating expenses of the project or system, before they are applied to other obligations. This rule applies regardless of the provisions of the transaction documents. It is not clear precisely which expenses would constitute necessary operating expenses and any definition in the transaction documents may not be applicable.
If the City is in bankruptcy, the parties (including the Trustee and the holders of the 2024 Bonds) may be prohibited from taking any action to collect any amount from the City or to enforce any obligation of the City, unless the permission of the bankruptcy court is obtained. These restrictions may also prevent the Trustee from making payments to the holders of the 2024 Bonds from funds in the Trustee’s possession. The City’s rate covenant may not be enforceable in bankruptcy by the Trustee or the holders of the 2024 Bonds.
The Net Water Revenues may be commingled with other City funds. If the City goes into bankruptcy, the City may not be required to turn over to the Trustee any Net Water Revenues that are in its possession at the time of the bankruptcy filing. In addition, if the City has possession of Net Water Revenues (whether collected before or after commencement of the bankruptcy) and if the City does not voluntarily turn over such Net Water Revenues to the Trustee, it is not entirely clear what procedures the Trustee and the holders of the 2024 Bonds would have to follow to attempt to obtain possession of such
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Net Water Revenues, how much time it would take for such procedures to be completed, or whether such procedures would ultimately be successful.
The City may be able to borrow additional money that is secured by a lien on any of its property (including the Net Water Revenues), which lien could have priority over the lien of the Installment Sale Agreement, or to cause some of the Net Water Revenues to be released to it, free and clear of the lien of the Installment Sale Agreement, in each case as long as the bankruptcy court determines that the rights of the Trustee and the holders of the 2024 Bonds will be adequately protected.
If the City is in bankruptcy it may be able, without the consent and over the objection of the Trustee and the holders of the 2024 Bonds, to alter the priority, interest rate, principal amount, payment terms, collateral, maturity dates, payment sources, covenants (including tax related covenants), and other terms or provisions of the Installment Sale Agreement, the Indenture and the 2024 Bonds, as long as the bankruptcy court determines that the alterations are fair and equitable.
There may be delays in payments on the 2024 Bonds while the court considers any of these issues.
There may be other possible effects of a bankruptcy of the City that could result in delays or reductions in payments on the 2024 Bonds, or result in losses to the holders of the 2024 Bonds. Regardless of any specific adverse determinations in a City bankruptcy proceeding, the fact of a City bankruptcy proceeding could have an adverse effect on the liquidity and value of the 2024 Bonds.
Limited Obligations
The 2024 Payments are limited obligations of the City and are not secured by a legal or equitable pledge or charge or lien upon any property of the City or any of its income or receipts, except the Net Water Revenues. The obligation of the City to make the 2024 Payments does not constitute an obligation of the City to levy or pledge any form of taxation or for which the City has levied or pledged any form of taxation.
The City is obligated under the Installment Sale Agreement to pay the 2024 Payments solely from the Net Water Revenues. There is no assurance that the City can succeed in operating the Water System such that the Net Water Revenues in the future amounts projected in this Official Statement will be realized.
Limited Recourse on Default
If the City fails to comply with its covenants under the Installment Sale Agreement or fails to make the 2024 Payments, there can be no assurance of the availability of remedies adequate to protect the interest of the holders of the 2024 Bonds. If the City defaults on its obligation to pay the 2024 Payments or other Parity Obligations securing Bonds, the Trustee has the right to accelerate the total unpaid principal amount of the Bonds outstanding and interest accrued thereon and all Parity Obligations may also be accelerated. However, in the event of a default and such acceleration there can be no assurance that the City will have sufficient funds to pay the accelerated debt service from Net Water Revenues.
Loss of Tax Exemption on the 2024 Bonds
In order to maintain the exclusion from gross income for federal income tax purposes of the interest on the 2024 Bonds, the City and the Authority have covenanted to comply with the applicable requirements of the Internal Revenue Code of 1986, as amended. The interest on the 2024 Bonds could become includable in gross income for purposes of federal income taxation retroactive to the date of issuance of such 2024 Bonds as a result of acts or omissions of the City or the Authority in violation of
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this or other covenants applicable to the 2024 Bonds. The 2024 Bonds are not subject to redemption or any increase in interest rates should an event of taxability occur and will remain outstanding until maturity or prior redemption in accordance with the provisions contained in the Trust Agreement. See “TAX MATTERS.”
Secondary Market for Bonds
There can be no guarantee that there will be a secondary market for the 2024 Bonds or, if a secondary market exists, that any 2024 Bonds can be sold for any particular price. Occasionally, because of general market conditions or because of adverse history or economic prospects connected with a particular issue, secondary marketing practices in connection with a particular issue are suspended or terminated. Additionally, prices of issues for which a market is being made will depend upon thenprevailing circumstances. Such prices could be substantially different from the original purchase price.
Uncertainties of Projections, Forecasts and Assumptions Certain information contained in this Official Statement is based upon assumptions, forecasts and projections. Projections, forecasts and assumptions are inherently subject to significant uncertainties.
Inevitably, some projections, forecasts or assumptions will not be realized and unanticipated events and circumstances may occur and actual results are likely to differ, perhaps materially, from those projected, forecasted or assumed. Accordingly, such projections, forecasts and assumptions are not necessarily indicative of future performance, and the City assumes no responsibility for the accuracy of such projections, forecasts or assumptions.
TAX MATTERS
In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Authority (“Bond Counsel”), based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the 2024 Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the “Code”) and is exempt from State of California personal income taxes. Bond Counsel is of the further opinion that interest on the 2024 Bonds is not a specific preference item for purposes of the federal individual alternative minimum tax. Bond Counsel observes that interest on the 2024 Bonds included in adjusted financial statement income of certain corporations is not excluded from the federal corporate alternative minimum tax. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the amount, accrual or receipt of interest on, the Bonds. A complete copy of the proposed form of opinion of Bond Counsel is set forth in Appendix F hereto.
To the extent the issue price of any maturity of the 2024 Bonds is less than the amount to be paid at maturity of such 2024 Bonds (excluding amounts stated to be interest and payable at least annually over the term of such 2024 Bonds), the difference constitutes “original issue discount,” the accrual of which, to the extent properly allocable to each Beneficial Owner thereof, is treated as interest on the 2024 Bonds which is excluded from gross income for federal income tax purposes and exempt from State of California personal income taxes. For this purpose, the issue price of a particular maturity of the 2024 Bonds is the first price at which a substantial amount of such maturity of the 2024 Bonds is sold to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the 2024 Bonds accrues daily over the term to maturity of such 2024 Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates).
The accruing original issue discount is added to the adjusted basis of such 2024 Bonds to determine
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taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such 2024 Bonds. Beneficial Owners of the 2024 Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 2024 Bonds with original issue discount, including the treatment of Beneficial Owners who do not purchase such 2024 Bonds in the original offering to the public at the first price at which a substantial amount of such 2024 Bonds is sold to the public. 2024 Bonds purchased, whether at original issuance or otherwise, for an amount higher than their principal amount payable at maturity (or, in some cases, at their earlier call date) (“Premium 2024 Bonds”) will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of bonds, like the Premium 2024 Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, the amount of tax-exempt interest received, and a Beneficial Owner’s basis in a Premium 2014 Bond, will be reduced by the amount of amortizable bond premium properly allocable to such Beneficial Owner. Beneficial Owners of Premium 2024 Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances.
The Code imposes various restrictions, conditions and requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the 2024 Bonds. The Authority and the City have made certain representations and covenanted to comply with certain restrictions, conditions and requirements designed to ensure that interest on the 2024 Bonds will not be included in federal gross income. Inaccuracy of these representations or failure to comply with these covenants may result in interest on the 2024 Bonds being included in gross income for federal income tax purposes, possibly from the date of original issuance of the 2024 Bonds. The opinion of Bond Counsel assumes the accuracy of these representations and compliance with these covenants. Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken), or events occurring (or not occurring), or any other matters coming to Bond Counsel’s attention after the date of issuance of the 2024 Bonds may adversely affect the value of, or the tax status of interest on, the 2024 Bonds. Accordingly, the opinion of Bond Counsel is not intended to, and may not, be relied upon in connection with any such actions, events or matters.
Although Bond Counsel is of the opinion that interest on the 2024 Bonds is excluded from gross income for federal income tax purposes and is exempt from State of California personal income taxes, the ownership or disposition of, or the accrual or receipt of amounts treated as interest on, the 2024 Bonds may otherwise affect a Beneficial Owner’s federal, state or local tax liability. The nature and extent of these other tax consequences depends upon the particular tax status of the Beneficial Owner or the Beneficial Owner’s other items of income or deduction. Bond Counsel expresses no opinion regarding any such other tax consequences.
Current and future legislative proposals, if enacted into law, clarification of the Code, or court decisions may cause interest on the 2024 Bonds to be subject, directly or indirectly, in whole or in part, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Beneficial Owners from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such legislative proposals or clarification of the Code or court decisions may also affect, perhaps significantly, the market price for, or marketability of, the 2024 Bonds.
Prospective purchasers of the 2024 Bonds should consult their own tax advisors regarding the potential impact of any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel expresses no opinion.
The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsel’s judgment as to the proper treatment of the 2024 Bonds for federal income tax purposes. It is not binding on the Internal Revenue Service
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(“IRS”) or the courts. Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the Authority or the City, or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The Authority and City have covenanted, however, to comply with the requirements of the Code.
Bond Counsel’s engagement with respect to the 2024 Bonds ends with the issuance of the 2024 Bonds, and, unless separately engaged, Bond Counsel is not obligated to defend the Authority, the City or the Beneficial Owners regarding the tax-exempt status of the 2024 Bonds in the event of an audit examination by the IRS. Under current procedures, Beneficial Owners, would have little, if any, right to participate in the audit examination process. Moreover, because achieving judicial review in connection with an audit examination of tax-exempt bonds is difficult, obtaining an independent review of IRS positions with which the Authority or the City legitimately disagrees, may not be practicable. Any action of the IRS, including but not limited to selection of the 2024 Bonds for audit, or the course or result of such audit, or an audit of bonds presenting similar tax issues may affect the market price for, or the marketability of, the 2024 Bonds, and may cause the Authority, the City or the Beneficial Owners to incur significant expense.
Payments on the Bonds generally will be subject to U.S. information reporting and possibly to “backup withholding.” Under Section 3406 of the Code and applicable U.S. Treasury Regulations issued thereunder, a non-corporate Beneficial Owner of Bonds may be subject to backup withholding with respect to “reportable payments,” which include interest paid on the Bonds and the gross proceeds of a sale, exchange, redemption, retirement or other disposition of the Bonds. The payor will be required to deduct and withhold the prescribed amounts if (i) the payee fails to furnish a U.S. taxpayer identification number (“TIN”) to the payor in the manner required, (ii) the IRS notifies the payor that the TIN furnished by the payee is incorrect, (iii) there has been a “notified payee underreporting” described in Section 3406(c) of the Code or (iv) the payee fails to certify under penalty of perjury that the payee is not subject to withholding under Section 3406(a)(1)(C) of the Code. Amounts withheld under the backup withholding rules may be refunded or credited against a Beneficial Owner’s federal income tax liability, if any, provided that the required information is timely furnished to the IRS. Certain Beneficial Owners (including among others, corporations and certain tax-exempt organizations) are not subject to backup withholding. The failure to comply with the backup withholding rules may result in the imposition of penalties by the IRS.
CERTAIN LEGAL MATTERS
The validity of the 2024 Bonds and certain other legal matters are subject to the approving opinion of Orrick, Herrington & Sutcliffe, LLP, Bond Counsel to the Authority. A complete copy of the form of Bond Counsel opinion is contained in Appendix F hereto. Certain legal matters will be passed upon for the City by Orrick, Herrington & Sutcliffe LLP as Disclosure Counsel and for the Authority and the City by the City Attorney, and for the Underwriter, by Kutak Rock LLP. Orrick, Herrington & Sutcliffe LLP undertakes no responsibility for the accuracy, completeness or fairness of this Official Statement.
CONTINUING DISCLOSURE
The City has covenanted on behalf of itself and the Authority, for the benefit of the holders and beneficial owners of the 2024 Bonds, to provide certain financial information and operating data relating to the City and the 2024 Bonds (the “Annual Report”) by not later than 270 days after the end of the City’s fiscal year (presently June 30), commencing with the report for the 2023-24 Fiscal Year, and to provide notices of the occurrence of certain enumerated events. Such reports and notices will be filed by the City with the Municipal Securities Rulemaking Board (the “MSRB”) through its Electronic Market
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Access system (“EMMA”). These covenants have been made in order to assist the Underwriter in complying with Securities Exchange Commission Rule 15c2-12(b)(5). The specific nature of the information to be contained in the Annual Report or the notices of enumerated events by the City is set forth in “APPENDIX C – FORM OF CONTINUING DISCLOSURE CERTIFICATE.” [Add description of any instances of material non-compliance with prior continuing disclosure undertakings if necessary.]
ABSENCE OF LITIGATION
To the best knowledge of the Authority and the City, there is no action, suit, proceeding or investigation at law or in equity before or by any court or governmental agency or body pending or threatened against the Authority to restrain or enjoin the authorization, execution or delivery of the 2024 Bonds, the pledge of the Revenues or the collection of the payments to be made pursuant to the Trust Agreement, the obligation of the City to pay 2024 Payments from the Net Water Revenues under the Installment Sale Agreement, or in any way contesting or affecting validity of the 2024 Bonds, the Trust Agreement, the Installment Sale Agreement, the Escrow Agreement or the agreement for the sale of the 2024 Bonds.
In addition, there is no litigation pending or threatened against the Authority or the City which, in the opinion of the City Attorney of the City, would materially adversely affect the Water System or the sources of payment for the 2024 Bonds.
RATING
S&P has assigned its municipal bond rating of “[__]” to the 2024 Bonds. Such rating reflects only the view of S&P and any desired explanation of the significance of such ratings should be obtained from S&P at the following address: 25 Broadway, New York, NY 10004. Generally, a rating agency bases its rating on the information and materials furnished to it and on investigations, studies and assumptions of its own. There is no assurance such rating will continue for any given period of time or that such rating will not be revised downward or withdrawn entirely by S&P, if in its judgment, circumstances so warrant. The Authority and the Underwriter have undertaken no responsibility either to bring to the attention of the owners of the 2024 Bonds any proposed change in or withdrawal of the rating or to oppose any such proposed revision or withdrawal. Any such downward change in or withdrawal of the rating might have an adverse effect on the market price or marketability of the 2024 Bonds.
FINANCIAL STATEMENTS
Attached as APPENDIX E are the audited financial statements of the City (the “Financial Statements”) for Fiscal Year 2022-23, which include financial statements for the Water System, prepared by the City’s Finance Department and audited by Maze & Associates, Pleasant Hill, California (the “Auditor”).
The Auditor’s letter concludes that the Financial Statements present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of June 30, 2023, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America.
The City currently expects that its audited financial statements for the Fiscal Year 2023-24 will be available to the public on or about December 10, 2024. The City believes that the unaudited financial
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information for the Fiscal Year 2023-24 presented in this Official Statement (including Appendix A) is consistent with the financial information that will be presented in the audited financial statements for Fiscal Year 2023-24.]
The Financial Statements include information regarding certain funds of the City, including its General Fund, which are not pledged to make 2024 Payments or to otherwise pay debt service on the 2024 Bonds. Additionally, the City has not requested nor did the City obtain permission from the Auditor to include the audited financial statements as an appendix to this Official Statement. Accordingly, the Auditor has not performed any post-audit review of the financial condition or operations of the City. In addition, the Auditor has not reviewed this Official Statement.
UNDERWRITING
The 2024 Bonds are being purchased by RBC Capital Markets, LLC (the “Underwriter”). The Underwriter has agreed to purchase the 2024 Bonds, subject to certain conditions, at a purchase price of $__________ (representing the principal amount of the 2024 Bonds, [plus/less] a [net] original issue [premium/discount] of $______, less an Underwriter’s discount of $_______. The Underwriter is committed to purchase all of the 2024 Bonds if any are purchased.
The 2024 Bonds are offered for sale at the initial prices stated on the cover page of this Official Statement, which may be changed from time to time by the Underwriter. The 2024 Bonds may be offered and sold to certain dealers at prices lower than the public offering prices.
MUNICIPAL ADVISOR
The Authority has retained Del Rio Advisors, LLC of Modesto, California, as municipal advisor (the “Municipal Advisor”) in connection with the offering of the 2024 Bonds and the preparation of this Official Statement. The Municipal Advisor assisted in the preparation and review of this Official Statement. All financial and other information presented in this Official Statement has been provided by the Authority and the City from their records, except for information expressly attributed to other sources.
The Municipal Advisor takes no responsibility for the accuracy or completeness of the data provided by the Authority, the City or others and has not undertaken to make an independent verification or does not assume responsibility for the accuracy, completeness, or fairness of the information contained in this Official Statement. The fee of the Municipal Advisor is contingent upon the successful closing of the 2024 Bonds.
VERIFICATION
Upon delivery of the 2024 Bonds, the arithmetical accuracy of certain computations included in the schedules provided by the Underwriter on behalf of the Authority relating to the: (i) adequacy of forecasted receipts of principal and interest on the defeasance securities and cash to be held pursuant to the Escrow Agreement, (ii) forecasted payments of principal and interest with respect to the Refunded Bonds on and prior to their redemption date; and (iii) yields with respect to the 2024 Bonds and on the obligations and other securities to be deposited pursuant to the Escrow Agreement, will be verified by [Verification Agent], independent certified public accountants (the “Verification Agent”). Such verification shall be based solely upon information and assumptions supplied to the Verification Agent by the Underwriter. The Verification Agent has not made a study or evaluation of the information and assumptions on which such computations are based and, accordingly, has not expressed an opinion on the data used, the reasonableness of the assumptions or the achievability of the forecasted outcome.
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MISCELLANEOUS
References are made herein to certain documents and reports which are brief summaries thereof which do not purport to be complete or definitive and reference is made to such documents and reports for full and complete statements of the contents thereof. Copies of the Trust Agreement, the Installment Sale Agreement, the Escrow Agreement and other documents referred to herein may be obtained from the Trustee or from the Authority.
Any statements in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact. This Official Statement is not to be construed as a contract or agreement between the Authority and the purchasers or owners of any of the 2024 Bonds.
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The execution and delivery of this Official Statement has been duly authorized by the Authority and the City.
BRENTWOOD INFRASTRUCTURE
FINANCING AUTHORITY
By:
Treasurer/Controller
CITY OF BRENTWOOD
By:
Director of Finance
& Information Systems
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APPENDIX A
INFORMATION RELATING TO THE WATER SYSTEM
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APPENDIX B
SUMMARY OF PRINCIPAL LEGAL DOCUMENTS
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APPENDIX C
FORM OF CONTINUING DISCLOSURE CERTIFICATE
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APPENDIX D
ECONOMIC AND DEMOGRAPHIC INFORMATION FOR THE CITY OF BRENTWOOD
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APPENDIX E
AUDITED FINANCIAL STATEMENTS
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APPENDIX F
PROPOSED FORM OF OPINION OF BOND COUNSEL
[To come]
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APPENDIX G
THE BOOK-ENTRY SYSTEM
This Appendix describes how ownership of the 2024 Bonds is to be transferred and how the principal of, premium, if any, and interest on the 2024 Bonds are to be paid to and accredited by DTC while the 2024 Bonds are registered in its nominee name. The information in this Appendix concerning DTC and the Book-Entry-Only System has been provided by DTC for use in disclosure documents such as this Official Statement. The Authority and the City believe the source of such information to be reliable, but take no responsibility for the accuracy or completeness thereof.
The Authority and the City cannot and do not give any assurance that (1) DTC will distribute payments of debt service on the 2024 Bonds, or redemption or other notices, to DTC Participants, (2) DTC Participants or others will distribute debt service payments paid to DTC or its nominee (as the registered owner of the 2024 Bonds), or redemption or other notices, to the Beneficial Owners, or that they will do so on a timely basis, or (3) DTC will serve and act in the manner described in this Official Statement. The current rules applicable to DTC are on file with the Securities and Exchange Commission, and the current procedures of DTC to be followed in dealing with DTC Participants are on file with DTC.
The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the 2024 Bonds. The 2024 Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered certificate will be issued for each maturity of the 2024 Bonds, in the aggregate principal amount of such maturity, and will be deposited with DTC.
DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over
3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com.
Purchases of 2024 Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the 2024 Bonds on DTC’s records. The ownership interest of each actual purchaser of each 2014 Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of
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the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the 2024 Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in 2024 Bonds, except in the event that use of the book-entry system for the 2024 Bonds is discontinued.
To facilitate subsequent transfers, all 2024 Bonds deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of 2024 Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the 2024 Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such 2024 Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.
Redemption notices shall be sent to DTC. If less than all of the 2024 Bonds within a maturity are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to 2024 Bonds unless authorized by a Direct Participant in accordance with DTC’s Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Authority as soon as possible after the record date.
The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts 2024 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).
Payments of principal and interest on the 2024 Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the Authority, on payable date in accordance with their respective holdings shown on DTC’s records.
Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with 2024 Bonds held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, or the Authority subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest on the 2024 Bonds to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as depository with respect to the 2024 Bonds at any time by giving reasonable notice to the Authority or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, 2014 Bond certificates are required to be printed and delivered.
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The Authority may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, 2014 Bond certificates will be printed and delivered to DTC.
OH&S DRAFT: 08/22/2024
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APPENDIX A
INFORMATION RELATING TO THE WATER SYSTEM
The Water System
The City’s water distribution system consists of a pipeline system, six water tanks with a total storage capacity of 18.8 million gallons, three pressure zones, six water booster pump stations, and eight groundwater wells located within the city limits (the “Water System”). The City currently receives its potable water supply from two surface water treatment plants and five active groundwater wells. On average, approximately 80% of the City’s annual potable water supply is from the surface water sources while the remaining amount is provided from the groundwater wells. The City also supplies recycled water for landscape irrigation and other recycled water uses through tertiary treatment at the City’s Waste Water Treatment Plant. Potable water is sampled and tested on a regular basis to ensure compliance with all state and federal drinking water standards, and the City’s Water Division staff performs daily site checks to ensure well productivity and to maintain the optimum operating performance of the delivery systems.
The City delivers water to more than 21,500 connections through approximately 354 miles of water mains, with the Water System being funded through user charges and impact fees. The City’s water customers are primarily residential. For example, in fiscal year 2022-23, 94% of the City’s water accounts were residential, accounting for 71% of the City’s combined water use and water use service charges of the Water System.
Water System Management
Casey Wichert is the City’s Director of Public Works. Casey has worked for the City since 2010 and has been in the water treatment industry for 32 years. The City’s Public Works Department is comprised of Fleet and Facilities Maintenance Services, Solid Waste, Streets, Wastewater, and Water.
These divisions oversee the operation and maintenance of all City Public Works Department infrastructure and facilities, including domestic water supply, treatment, and distribution, garbage collection and recycling services, roadways, wastewater collection and treatment, storm drainage and creek maintenance, and maintenance of the City’s building facilities, vehicles, and equipment structure.
Water System Employees
The City’s Water Enterprise has 20 full time authorized positions; exclusive of the Director of Public Works who also oversees the City’s other two utilities. The City’s labor contracts with the Water Enterprise employees expired on June 30, 2024. Currently, the City is in the process of negotiating successor contracts with these employees. In fiscal year 2022-23, the City adopted a rate study for fiscal years 2023-24 through 2027-28, which included placeholder cost-of-living adjustments for salary and benefit increases in the rate assumptions. The City believes that the salary and benefit rate assumptions will be adequate for the new contracts currently under negotiation. [confirm no change prior to POS posting]
Water System Facilities and Water Supply
Surface Water Treatment Plants. The City receives potable water from two surface water treatment plants: the Brentwood Water Treatment Plant (the “BWTP”) and the Randall-Bold Water Treatment Plant (the “RBWTP”). The BWTP was built in 2008 to serve the City. It was part of a joint venture between the City and the Contra Costa Water District (“CCWD”) in which the City owns the
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facility and is responsible for operational and capital costs but contracts with CCWD for operation and maintenance of the facility. The first phase of the BWTP, which has been constructed and is in operation, can treat up to 16.5 million gallons per day (“mgd”) of surface water. However, the plant is designed so that it can be expanded to an ultimate capacity of 32 mgd to serve the City’s projected water demands through 2040. Certain components of the BWTP, including the headworks, chemical feed and storage and treated water pump station were all originally constructed for the ultimate capacity of 32 mgd. Other components of the BWTP will need to be added or expanded to meet this ultimate capacity. The additions and expansions to the BWTP are expected to occur within five to ten years and are expected to be funded by water development impact fees and accumulated water system revenues, although a portion may be funded with additional Parity Obligations. The City currently estimates that the capital costs of the additions or expansions to the BWTP could be in the range of $100 million to $200 million.
The BWTP treats raw water that the City purchases from the East Contra Costa Irrigation District (the “ECCID”) under a permanent pre-1914 capacity right and diverts from Old River, Middle River, and Rock Slough, all of which have intakes connected by CCWD’s 48-mile Contra Costa Canal (the “Contra Costa Canal”). The BWTP facilities are used for raw water pumping, flash mixing, flocculation, sedimentation, ozonation, filtration, and water storage. Treated surface water from the BWTP is pumped into the City’s distribution system by a treated water pump station and a large diameter transmission pipeline. The BWTP produces an annual average of 6 mgd of treated water for the City. Effluent flows vary from 3 mgd to more than 12 mgd based on seasonal demand of the City.
The RBWTP is owned and operated by CCWD and is adjacent to the BWTP. The RBWTP treats Delta water that is blended in the Contra Costa Canal (Old River, Middle River, and Rock Slough) and Los Vaqueros Reservoir. The City has purchased from CCWD a permanent 6 mgd capacity right to treated water from the RBWTP. Treated surface water from the RBWTP is pumped into the City’s distribution system by the same treated water pump station and large diameter transmission pipeline as treated water from the BWTP. The City’s contract with CCWD in respect of the RBWTP is a take-or-pay contract pursuant to which the City pays a monthly charge per acre foot of water delivered, plus a demand and service charge.
Groundwater Wells. Five out of nine permitted groundwater wells located within the City’s water service area are active. Groundwater is treated at the wellhead prior to delivery to the drinking water distribution system. The City has two main well fields: Wells 6, 7, 8, 14, and 15, located in the northeast part of the City, and Wells 12 and 13 to the south. Of the four wells that are not in use, Well 9 currently does not have a disinfection system, Well 11 is not used because of high nitrate and total chromium concentrations, Well 12 is not used because of high nitrate concentrations, and Well 13 is a standby emergency source, due to high Chromium 6 concentrations. The wells are not typically drawn to capacity as the average annual production of all the active wells is approximately 2.5 mgd and the total well capacity is 5.15 mgd.
Reservoirs. Six existing reservoirs in the City have a combined capacity of 18.8 million gallons.
Water is pumped into the reservoirs and used as water demand requires. Therefore, available reservoir water volumes fluctuate daily but are kept relatively consistent throughout the year. These reservoirs provide storage, equalization, emergency supply, and fire supply.
Los Vaqueros Reservoir. The City has an existing agreement with CCWD that provides emergency storage of water in the Los Vaqueros Reservoir for a portion of the City’s service area.
Pursuant to a Memorandum of Understanding with CCWD dated February 29, 2000, as amended on February 2, 2015 (the “CCWD MOU”), the City is an active participant in an upcoming expansion of Los Vaqueros Reservoir. The City’s participation in the expansion will result in additional water quality and emergency storage benefits associated with the increased capacity of the Los Vaqueros Reservoir and
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provide those benefits for the City’s entire service area. The Los Vaqueros Reservoir expansion project is a multi-agency, multi-year effort that is still in the planning and approval stage. The City has been setting aside funds in the anticipation of a large capital buy-in expense when this project comes to fruition. The City plans to budget $1,000,000 per year for fiscal years 2024-25 through 2028-29 and approximately $5.6 million have already been set aside for the reservoir expansion project. See also “Capital Improvement Program” below.
Pump Stations. Of the seven Water System pump stations, one of them, the Recycled Water Pump Station, which is located on Fairview Avenue near the ECCID canal, delivers recycled water for irrigation of parks, parkway landscaping, and schools. The City has redundant pumping capacity, including the treated water pump station located adjacent to the BWTP, to the multiple boosting stations necessary to fill the reservoirs.
Distribution System. The City’s distribution system consists of pipelines of various sizes, all of which are adequately sized to meet build out demands. The City currently maintains 354 miles of distribution mains. The original water mains (approximately five miles) were constructed in 1940. Other water mains have been constructed more recently. The City’s water mains range in size from 4 to 42 inches. The City currently has an ongoing program to replace sections of the original water mains that are in need of repair.
Water Consumption
The following table shows the historical billed water consumption for the Water System since 2020: [add August 2024 if available before POS posting] TABLE 1
CITY OF BRENTWOOD
Water Consumption History
(1,000 gallons/month)
As of [July] 2024
2020 2021 2022 2023 2024
January 138,838 162,850 148,061 137,842 150,737
February 152,522 168,800 189,353 141,684 127,889
March 201,908 198,734 226,725 125,442 140,968
April 319,798 283,530 265,716 160,295 201,942
May 326,716 364,406 310,274 301,194 302,983
June 438,013 421,593 399,056 345,756 418,767
July 437,515 424,694 414,311 414,986 502,871
August 459,379 427,216 420,749 430,829 [_____]
September 435,321 429,020 381,670 400,415 -
October 358,922 340,270 338,310 329,853 -
November 297,005 202,536 248,845 276,978 -
December 227,666 143,283 159,576 178,266 -
Total 3,793,603 3,566,932 3,502,646 3,243,540 1,846,157 Source: City of Brentwood.
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Water Supply Shortages
The City has developed six stages of action to be taken in response to water supply shortages, including a reduction in water supply by up to 50%. Specific water supply conditions are applicable to each stage of action. A stage of action will be implemented during water supply shortages according to shortage level, ranging from a 10% shortage (i.e., Level 1) to a 50% shortage (i.e., Level 6). The stage determination and declaration during a water supply shortage will be made by the public works director.
The City is currently at Shortage Level 1, which is the normal level not indicative of drought conditions but pursuant to which the City encourages water conservation by the City’s customers.
Shortage Level 1. During Level 1 of a water supply shortage, the shortage is minimal, up to 10 percent. At this level, voluntary conservation is encouraged, including encouraging customers to limit the watering of lawn, landscape or other turf area with water supplied by the City. The City maintains an ongoing public information campaign consisting of distribution of literature, speaking engagements, bill inserts, and conversation messages printed in local newspapers and on the City’s internet web page. The drought situation is explained to public and governmental bodies. The City requests voluntary water conservation, explains other stages and forecast future actions. Educational programs in area schools are ongoing.
Shortage Level 2. During Level 2 of a water supply shortage, the shortage is moderate, up to 20 percent. At this level, conservation may be voluntary, consist of conservation goals, and/or include mandatory conservation rules, including, encouraging customers to limit the watering of lawn, landscape or other turf area with water supplied by the City to any four days per week maximum. All steps taken in prior stages are intensified and production is monitored daily for compliance with necessary reductions.
The severity of actions depends upon the percentage of the shortage. The City aggressively continues its public information and education programs. The City asks for 10 to 20 percent voluntary or mandatory water use reductions. If necessary, the City also supports passage of drought ordinances.
Shortage Level 3 to 4. During Level 3 to 4 of a water supply shortage, the shortage is severe, 20 to 40 percent, and conservation consists of conservation goals and mandatory conservation rules. This may include limiting the watering of lawn, landscape or other turf area with water supplied by the City to any three days per week maximum. All steps taken in prior stages are intensified and production is monitored daily for compliance with necessary reductions. This level becomes effective upon notification by the City that water usage is to be reduced by a mandatory percentage. The City would adopt drought ordinances, implement mandatory reductions, and enforce fines and penalties for water waste. Rate changes may be implemented to penalize excess usage. Drought surcharges or rates may be applied based on City Council’s direction. The City would restrict outdoor water usage at City facilities by reducing water times or using non-potable/recycled water. The City would implement the use of recycled water fill stations at the City wastewater treatment plant to offset potable water use. Water use restrictions are put into effect; i.e., prohibited uses can include, but are not limited to, restrictions on daytime hours for watering, excessive watering resulting in gutter flooding, using hoses without a shutoff device, non-recycling fountains and washing down sidewalks or patios, and unrepaired leaks. The City monitors monthly customer billing data and production weekly for compliance with necessary reductions.
Shortage Level 5 to 6. During Level 5 to 6 of a water supply shortage, the shortage is critical, greater than 40 percent. Conservation consists of conservation goals and mandatory conservation rules.
This may include limiting the watering of lawn, landscape or other turf area with water supplied by the City to any two days per week maximum. All steps taken in prior stages are intensified and production is monitored daily for compliance with necessary reductions.
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Environmental Compliance
Both of the water treatment plants must produce water that meets State of California (the “State”) and federal regulations for drinking water quality. In general, the State is primarily concerned with the administration of federal drinking water requirements, but can add additional, or more restrictive requirements. If the federal government, acting through the United States Environmental Protection Agency, or the State, acting through the California Department of Health, or additional federal or State legislation, should impose stricter water quality standards or other additional regulatory requirements upon the Water System, then the City’s treatment expenses could increase accordingly and rates and charges may have to be increased to offset those expenses. The City cannot predict the future direction that federal or State regulation will take with respect to drinking water quality standards and requirements, although it is likely that in the future the federal government and the State will impose more stringent standards with attendant higher costs.
The City’ surface water supply is treated in newer facilities that were designed and constructed to treat the source water to a very high quality that exceeds the standards of the American Water Works Association’s “Partnership for safe Drinking Water.” The City's drinking water is in compliance with all current federal and State drinking water standards applicable to the City.
Capital Improvement Program
On May 28, 2024, the City Council adopted the Capital Improvement Program (the “CIP”) for fiscal years 2024-25 through 2028-29. This CIP includes budgeted funding of the following major projects from Water Revenues:
Canal Replacement Cost Share – Segment 5: The City currently utilizes CCWD conveyance facilities (Contra Costa Canal, pumps, underground pipes and screens) for the delivery of water to the BWTP. Pursuant to the CCWD MOU, the City will pay for its proportional share of upgrades to CCWD’s facilities. This project accounts for the City’s proportional share of the projected costs for CCWD’s Canal Replacement Project (Segment 5A and 5B). The projected contribution from the Water System is $2,678,972 over the five-year CIP period.
Pump Station 2.4 Installation: The City’s Water Master Plan adopted on June 1, 2017, identified the Pump Station 2.4 Installation project as necessary to serve the future development of the Innovation Center at Brentwood, formerly known as Priority Area - 1, and Bridle Gate. This project will install a pump station adjacent to Reservoir 1.3 located on St. Regis Avenue within the City. The new pump station is expected to provide approximately 4,500 gallons per minute (“GPM”) (or approximately 6.5 million gallons per day (“GPD”)) of pumping capacity when fully operational. The pump station design will include four 1,500-GPM, 20 horse power, 3-phase, 240/480V pumps, one concrete masonry unit block building, electrical and instrumentation, 8/12/16-inch pipe and fittings, one magnetic flow meter, a paved access road and fencing for the pump station. The projected contribution from the Water System is $4,035,000 over the five-year CIP period.
Water Storage Capacity at Los Vaqueros Reservoir: The Los Vaqueros Reservoir project involves a partnership with CCWD to work together on the Los Vaqueros Reservoir expansion project. Pursuant to the CCWD MOU, the City and CCWD are working towards an agreement to allow the City to purchase and deliver water that has been stored in the Los Vaqueros Reservoir. It will enable the City to pump high-quality low-chloride water during the wet months for storage in the Los Vaqueros Reservoir and be available for withdrawal and blending during the dry months, when delta water quality is at its worst. Chloride levels in the delta increase in late summer and fall and are even worse in drought years.
Having the ability to use high-quality water during these times will ensure adequate supply, long-term
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water quality and regulatory compliance for the City. The projected contribution from the Water System is $5,000,000 over the five-year CIP period.
Water and Wastewater Laboratory: The Water and Wastewater Laboratory project will provide a new, larger laboratory for the water and wastewater systems. The existing laboratory which was constructed in 2002 is outdated and has outgrown its footprint, and the building is not readily expandable.
Constructing a new, larger laboratory and converting the existing laboratory to office space will provide laboratory space adequate for build-out conditions, and has the added benefit of eliminating the need to build additional office space. The projected contribution from the Water System is $860,000 over the five-year CIP period.
Brentwood Manor Water and Wastewater Rehabilitation: This project includes the replacement of 3,200 linear feet of water, sewer and storm drain facilities to correct existing operations and maintenance constraints due to the age of the facilities. This project will allow the City to accommodate the anticipated development around the surrounding area and bring the aging facilities up to current standards. The projected contribution from the Water System is $3,243,500 over the five-year CIP period.
The City does not currently expect to incur any Parity Obligations to pay the Water System costs contained in the current CIP.
Rate Structure
In accordance with California law and subject to certain State constitutional restrictions, the City Council may, from time to time, and at its discretion, fix, alter, change, amend, or revise any connection charges, fixed monthly services fees, commodity charges, and other fees related to the Water System.
Consequently, the City Council periodically reviews such charges and fees to determine if they are sufficient to cover maintenance and operations costs, capital improvement expenditures, and debt service requirements. Such charges and fees are set by the City Council for the services provided by the Water System after a majority protest hearing is held. Neither the City nor the Water System is subject to the jurisdiction of, or regulation by, the California Public Utilities Commission or any other regulatory body in connection with the establishment of charges and fees related to the Water System.
The water rate structure consists of a fixed monthly base rate, which varies by meter size, plus a variable tiered consumption charge based upon metered water consumption. There are four usage tiers for residential customers and two usage tiers for non-residential customers.
On June 13, 2023, the City adopted Resolution No. 2023-76, which provides for an increase in the monthly base rate and consumption charge during fiscal years 2023-2024 to 2027-28, effective July 1, 2023. Annually on July 1, the monthly base rate will increase 6.5% and the potable consumption charges will increase approximately 6.5%.
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Under the ordinance, rates per billing unit per month for water delivered or furnished within the limits of the City will be as shown below:
TABLE 2
CITY OF BRENTWOOD
Water Rates Per Billing Unit Per Month
Monthly Base Rate
Effective
7/1/2023
Effective
7/1/2024
Effective
7/1/2025
Effective
7/1/2026
Effective
7/1/2027
5/8” or 3/4” meter $28.16 $30.00 $31.95 $34.03 $36.25
1” meter 41.24 43.93 46.79 49.84 53.08
1 1/2” meter 73.91 78.72 83.84 89.29 95.10
2” meter 113.13 120.49 128.33 136.68 145.57
3” meter 237.31 252.74 269.17 286.67 305.31
4” meter 420.31 447.64 476.74 507.73 540.74
6” meter 858.20 913.99 973.40 1,036.68 1,104.07
Consumption Charge (per 1,000 gallons = 1 unit)
Residential Tiers
Tier 1: Units 1-5 $3.18 $3.39 $3.62 $3.86 $4.12
Tier 2: Units 6-14 6.60 7.03 7.49 7.98 8.50
Tier 3: Units 15-20 8.33 8.88 9.46 10.08 10.74
Tier 4: Units 21+ 8.43 8.98 9.57 10.20 10.87
Non-Residential
Tier 1: Units 1-5 $3.20 $3.41 $3.64 $3.88 $4.14
Tier 2: Units 6+ 7.98 8.50 9.06 9.65 10.28
Non-Potable
All Units $1.08 $1.19 $1.23 $1.27 $1.31
Hydrant
All Units $8.91 $9.49 $10.11 $10.77 $11.48
Drought Surcharge Per Unit
10% Reduction $0.46 $0.49 $0.52 $0.56 $0.59
20% Reduction 0.95 1.01 1.08 1.15 1.22
30% Reduction 1.50 1.60 1.70 1.81 1.93
40% Reduction 2.35 2.50 2.67 2.84 3.02
50% Reduction 3.16 3.37 3.58 3.82 4.07
Source: City of Brentwood.
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Water User Accounts
The following table shows the customer accounts and percentage of service charge revenues for the fiscal years ended June 30, 2019 through June 30, 2023:
TABLE 3
CITY OF BRENTWOOD
Customer Accounts as a Percentage of Revenues
(Five Fiscal Years Ended June 30, 2023)
Fiscal Year
Ended
Number of Single-Family
Residential Accounts
Percentage of
Revenues
Number of Other
Accounts
Percentage of
Revenues
2019 19,095 73% 1,097 27%
2020 19,402 74 1,133 26
2021 19,703 74 1,167 26
2022 19,950 72 1,193 28
2023 20,109 71 1,206 29
Source: City of Brentwood.
Account Delinquencies
Monthly utility billings by the City include both water and wastewater charges, as well as charges for solid waste disposal. All bills are due on the 25th day following the original billing date, and if not paid by the due date, the City will add a five percent delinquency penalty to the following bill.
Additionally, the City will mail notices if payment is not made in time and will discontinue water service if payment is not made within 60 days of the original billing date. The delinquency rates for the solid waste, wastewater, and water systems of the City for the five fiscal years ended June 30, 2023 are set forth in the following table:
TABLE 4
CITY OF BRENTWOOD
Delinquency Rate of the Solid Waste, Wastewater and Water Systems (Five Fiscal Years Ended June 30, 2023)
Fiscal Year Delinquency Rate(1)
2019 0.28%
2020 0.58
2021 1.41
2022 0.93
2023 0.58
(1)
Delinquencies, over 90 days at June 30, expressed as a percentage of annual total operating revenues received by the City with respect to the water, wastewater, and solid waste disposal services combined.
Source: City of Brentwood.
Water Development Impact Fee
Each property applying for new water service is charged a water development impact fee (the “Water Development Impact Fee”). This fee is a calculation of pro rata fiscal responsibility development
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shares in the cost of providing water facilities. The calculation is based on the estimated cost of constructing water treatment, distribution and storage facilities necessary to serve the population of the City at general plan build-out and projecting that cost over estimated residential and non-residential development in the City’s general plan. The fee is reviewed periodically by the City Council, and the City Council may from time to time adjust the fee to reflect changes in the projected costs for the necessary improvements. Each property must pay the fee when the permit is issued, based upon meter size and capacity, as shown below.
Water Development Impact Fees for single and multifamily units are charged based on a per unit charge basis; office, commercial, and industrial uses are charged on a square footage basis. Pursuant to its authority under City Council Resolution No. 2021-20, dated February 9, 2021, the City imposed the following fees effective July 1, 2024:
TABLE 5
CITY OF BRENTWOOD
Water Facilities Fees
As of July 1, 2024
(1)
Use Water Facilities Fee
Single Family Residential $16,290.34/unit
Multifamily Residential 6,682.22/unit
Office 2.0648/sq. ft.
Commercial 1.6777/sq. ft.
Industrial 1.4339/sq. ft.
(1) Per the Development Fee Program adopted pursuant to Resolution No. 2021-20, the City may, on July 1 of each year, increase its Water Development Impact Fee. Adjustment to the fees shall be made annually in accordance with the Engineering News Record Construction Cost Index (“ENR Index”).
Source: City of Brentwood.
If a developer constructs a portion of the facilities included in the list of improvements which are the basis for the Water Development Impact Fee, the developer is given a credit against its obligation to pay Water Development Impact Fees. If the City’s reimbursement obligation to the developer is greater than the Water Development Impact Fee payment, the City enters into a reimbursement agreement which obligates the City to reimburse the developer when fees have been collected from other developers and the fund has a positive balance. The average credit per unit received by developers during the fiscal year ended June 30, 2023 was $0.00.
The Water Development Impact Fees constitute Connection Fees under the Installment Sale Agreement.
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Comparative Rates
The following table sets forth a list of some other major water agencies and municipalities in the vicinity of the City and compares their average annual water service charges, reflecting information available as of March 2023. The figures are based on an average household using 260 gallons per day.
TABLE 6
CITY OF BRENTWOOD
Comparative Average Annual Household
Water Service Charges
City/Agency
Average Annual Household
Water Service Charge
East Bay Municipal Utility District $1,090
Contra Costa Water District 978
City of Pittsburg 935
City of Antioch 769
Brentwood 740
Diablo Water District (Oakley) 691
Largest Users
The following table presents certain information regarding the ten principal users of the Water System, excluding the City, for the fiscal year ended June 30, 2024, as compared to all other users of the Water System:
TABLE 7
CITY OF BRENTWOOD
Top Water System Accounts
Based on Average Monthly Amount Paid
Fiscal Year 2023-24
User Account Amount Units Used
Top 10 Users $209,464.70 7,239
Balance of System 4,325,710.84 208,635
Totals $4,535,175.54 215,874
Source: City of Brentwood Finance Department, Utility Billing.
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Pension Plans
The City provides retirement benefits to its employees through contracts with California Public Employees’ Retirement System (“PERS”). PERS provides retirement and disability benefits, annual costof-living adjustments and death benefits to PERS members and beneficiaries. PERS is a contributory plan deriving funds from employee contributions as well as from employer contributions and earnings from investments. Benefit provisions under the Plans are established by State statute and City resolution.
PERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the PERS website.
The City has two defined benefit pension plans, a Miscellaneous Plan and a Safety Plan. The Miscellaneous Plan is an Agent Multiple-Employer Plan and the Safety Plan is a Cost-Sharing Multiple Employer Plan. All qualified permanent and probationary employees are eligible to participate in either the City’s Safety (Sworn) or Miscellaneous (Non-sworn) Plans, administered by PERS, which acts as a common investment and administrative agent for its participating member employers. The City contributes to PERS amounts equal to the recommended rates for each PERS Plan multiplied by the payroll of those employees of the City who are eligible under PERS.
Salaries and benefits costs of the City’s Water Enterprise include funding of retirement benefits for employees assigned to the Water Enterprise who, as City employees, participate in PERS Miscellaneous Plan. The City makes an annual employer contribution to the Miscellaneous Plan. City employees assigned to the Water Enterprise are required to pay the full amount of their employee contribution. Retirement payments paid from Water Revenues, with respect to employees assigned to the Water Enterprise, average approximately 9.0% of annual employer pension costs paid towards the Miscellaneous Plan. The City’s employer contributions payable from Water Revenues for pensions were $483,424 for fiscal year 2023-24 and are estimated to be approximately $600,723 for fiscal year 2024-25.
Payments to PERS constitute Maintenance and Operation Costs under the Installment Sale Agreement.
The City has also made additional discretionary payments to the Miscellaneous Plan over the past several years, and anticipates doing so in the coming years. This serves to reduce the long-term costs to City.
The Water Enterprise is charged for its pro-rata share for additional discretionary payments when made.
In fiscal year 2023-24 the Water Enterprise contributed $285,652 for its share of the additional discretionary payment.
For a variety of reasons, including investment losses, the City has experienced unfunded liabilities, and retirement costs payable with respect to all City employees, including those assigned to the Water System, have increased in recent years. As of June 30, 2023 (the most recent actuarial date), the City’s “Miscellaneous Plan” with PERS (in which the City employees assigned to the Water Enterprise participate) had an unfunded liability (with respect to all participating City employees, including employees assigned to the General Fund, the Water Revenue Fund, and other enterprise funds) of approximately $42.0 million (market value basis), and a funded ratio of 79.1% (market value basis).
Required contributions from the City are expected to increase in the coming years. See APPENDIX E — “AUDITED FINANCIAL STATEMENTS – Note 10 to the Basic Financial Statements” for a discussion of retirement liabilities payable by the City.
Post Employment Healthcare Benefits
The City provides certain post-retirement health care benefits (“OPEB”). The City’s Retiree Healthcare Plan is a defined benefit healthcare plan administered by the City. Benefit provisions are established and may be amended through agreements and memorandums of understanding between the City and its employees. The City provides retiree medical benefits through the PERS healthcare program
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and the Public Employees’ Medical and Hospital Care Act (“PEMHCA”). The City participates in the CERBT program, an irrevocable trust established to fund OPEB.
The City covers premiums, subject to caps dependent on hire date for eligible retirees, with service or disability retirement directly from the City under PERS. Coverage extends to dependents and surviving spouses. No dental, vision or life insurance benefits are provided. The City has three benefit tier levels. All tiers provide for certain post-retirement health care benefits for employees who retire from the City and who meet the following criteria: (1) they retire after reaching the age of 50 and (2) they have at least five years of cumulative service credits with organizations participating in a PERS defined benefit pension plan.
The tiers are differentiated by maximum amount of health insurance coverage paid by the City.
The first tier, for employees that retired prior to July 1, 2012, provides a maximum monthly coverage amount equal to the Kaiser dual rate (currently $2,042.82) for Miscellaneous Plan retirees, with future increases based upon annual increases in specified medical premium rates. The second tier, for employees hired prior to July 1, 2012 with a retirement date on or after July 1, 2012, provides for a maximum monthly coverage amount of $1,326.63 for Miscellaneous Plan retirees, with no future increases in the maximum coverage amount until such time that the Kaiser employee-only monthly medical insurance rate (currently $1,021.41) exceeds $1,326.63. The third tier, for employees hired on or after July 1, 2012, provides for a maximum monthly coverage amount equal to the PEMHCA minimum, currently $157 per month. This amount is set annually by PEMHCA. As of June 30, 2023, there were 174 retirees receiving postemployment health care benefits from the City (including other Enterprises and the General Fund).
The City’s OPEB related payments paid from Water Revenues were $233,471 in fiscal year 2023-24 and are projected to be approximately $195,755 in fiscal year 2024-25. The City makes annual contributions to the OPEB trust in amounts equal to 85% of the Actuarially Determined Contribution (“ADC”). Once the City’s OPEB trust has reached an 85% funded ratio the City intends to maintain funding at a level percentage of payroll until a funded ratio of 100% is attained. The City’s prefunding strategy has resulted in significant improvements in the funded percentage of the OPEB trust, which has increased from 18% funded in the fiscal year 2014-15 to 46% funded in fiscal year 2022-23; and is projected to exceed 50% funded as of June 30, 2024. Annual OPEB contributions from the Water Enterprise are projected to remain relatively steady for the coming decade, before declining once the unfunded liability has been exhausted. See APPENDIX E – “AUDITED FINANCIAL STATEMENTS – Note 9 to the Basic Financial Statements” for a discussion of OPEB liabilities payable by the City, as well as the City’s current unfunded OPEB liability.
Investment of City Funds
Water Revenues collected by the City will be held and invested by the City in accordance with the provisions of the Installment Sale Agreement.
Funds held by the City, including Water Revenues, are invested in accordance with the City’s investment policy (the “Investment Policy”) prepared by the City’s Director of Finance & Information Systems as authorized by section 53601 of the Government Code of California. The Investment Policy is submitted to the City Council annually. The Investment Policy allows for the purchase of a variety of securities and provides for limitations as to exposure, maturity and rating which vary with each security type. The composition of the portfolio will change over time as old investments mature, or are sold, and as new investments are made. Invested funds are managed to ensure preservation of capital through high quality investments, maintenance of liquidity and then yield. Further, operating funds may not be invested in any investment with a maturity greater than five years.
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For more information about the City’s cash and investments and investment policy as of the fiscal year ended June 30, 2023, see Note 3 to Appendix E of this Official Statement.
Historical and Projected Operating Results
The tables on the following pages show the historical and projected Net Water Revenues and debt service coverage for the years indicated.
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TABLE 8
CITY OF BRENTWOOD
Historical Net Water Revenues and Debt Service Coverage Five Fiscal Years ended June 30, 2023
2018-19 2019-20 2020-21 2021-22 2022-23
Operating Revenues
Charges for Services $22,764,896 $25,616,512 $27,727,333 $27,278,840 $26,491,553 Other Income 129,171 103,457 74,180 99,178 145,740
Total Operating Revenues $22,894,067 $25,719,969 $27,801,513 $27,378,018 $26,637,293 Operating Expenses
Personnel Services(1) $5,111,584 $4,510,368 $4,461,647 $4,809,866 $5,091,162 Repairs and Maintenance 835,619 576,885 1,102,602 980,442 709,722 Materials, Supplies and Services 12,514,468 12,186,800 14,442,508 13,940,908 15,100,836 Depreciation and Amortization 3,448,609 3,536,291 3,742,669 3,747,274 3,979,047 Total Operating Expenses $21,910,280 $20,810,344 $23,749,426 $23,478,490 $24,880,767 Operating Income $983,787 $4,909,625 $4,052,087 $3,899,528 $1,756,526 Non-Operating Revenues
Interest Income(2) $555,415 $844,588 $763,550 $645,424 $809,179 Contributions - Impact Fees and
Credits 1,805,819 1,671,205 3,043,312 4,630,204 380,314 Total Non-Operating Revenues $2,361,234 $2,515,793 $3,806,862 $5,275,628 $1,189,493 Net Revenues (Excluding
Depreciation and Amortization) $6,793,630 $10,961,709 $11,601,618 $12,922,430 $6,925,066 Net Revenues (Without
Connection Fees) $4,987,811 $9,290,504 $8,558,306 $8,292,226 $6,544,752 Debt Service for Parity Obligations $3,514,000 $3,513,600 $3,514,100 $3,510,350 $3,507,350 Debt Service Coverage for Parity
Obligations 1.93x 3.12x 3.3x 3.68x 1.97x
Debt Service Coverage (Without
Connection Fees) 1.42x 2.64x 2.44x 2.36x 1.87x
Source: City of Brentwood.
(1) Includes discretionary pension paydown payments and excludes non-cash adjustments required by GASB 68 and GASB 75.
(2) Excludes non-cash fair market value adjustments.
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TABLE 9
CITY OF BRENTWOOD
Projected Net Water Revenues and Debt Service Coverage(1) Five Fiscal Years ending June 30, 2028
2023-24 2024-25 2025-26 2026-27 2027-28
Operating Revenues
Charges for Services $29,052,240 $30,870,307 $33,168,784 $35,435,732 $37,859,749 Other Income 19,800 48,045 48,229 48,303 48,303
Total Operating Revenues $29,072,040 $30,918,352 $33,217,013 $35,484,035 $37,908,052 Operating Expenses
Personnel Services(2) $4,763,274 $5,584,160 $5,584,643 $5,879,230 $6,073,022 Repairs and Maintenance 888,754 1,063,438 1,076,032 1,108,312 1,141,567 Materials, Supplies and Services 16,387,529 19,605,768 20,388,717 20,223,949 21,040,142 Depreciation and Amortization 4,074,748 4,364,652 4,722,885 4,859,616 4,959,616 Total Operating Expenses $26,114,305 $30,618,018 $31,772,277 $32,071,107 $33,214,347 Operating Income $2,957,735 $300,334 $1,444,736 $3,412,928 $4,693,705 Non-Operating Revenues
Interest Income(3) $713,135 $1,166,929 $964,745 $871,958 $1,106,836 Contributions - Impact Fees and
Credits 1,929,721 1,662,555 2,209,285 2,602,589 2,213,908 Total Non-Operating Revenues $2,642,856 $2,829,484 $3,174,030 $3,474,547 $3,320,744 Net Revenues (Excluding
Depreciation and Amortization) $9,675,339 $7,494,470 $9,341,651 $11,747,091 $12,974,065 Net Revenues (Without Connection
Fees) $7,745,618 $5,831,915 $7,132,366 $9,144,502 $10,760,157 Debt Service for Parity Obligations $3,509,850 $3,517,350 $3,509,350 $2,851,350 $2,850,600 Debt Service Coverage for Parity
Obligations 2.76x 2.13x 2.66x 4.12x 4.55x
Debt Service Coverage (Without
Connection Fees) 2.21x 1.66x 2.03x 3.21x 3.77x
(1)
Assumptions: Revenues are from current and new users connecting to the Water System and include adopted system revenue rate increases of 6.5% per year through and including July 1, 2027. Operating expenditures include increases of approximately 5.0% per year for CCWD contractual services and conveyance costs and inflationary increases of about 3.3% per year for other expenditures. Debt Service for Parity Obligations does not reflect the refunding of the Refunded Bonds and the issuance of the 2024 Bonds.
(2) Includes discretionary pension paydown payments and excludes [non-cash adjustments] required by GASB 68 and GASB 75.
(3) Excludes non-cash fair market value adjustments. Earnings on the average beginning and ending cash balance in the Water Systems funds assuming a 3.25% annual interest rate.
Source: City of Brentwood.
OH&S DRAFT: 08/22/2024
1 4125-2953-2754
CONTINUING DISCLOSURE CERTIFICATE
This CONTINUING DISCLOSURE CERTIFICATE (the “Disclosure Certificate”) is executed and delivered by the CITY OF BRENTWOOD (the “City”), for and on behalf of itself and the Brentwood Infrastructure Financing Authority (the “Authority”), in connection with the execution and delivery of the Authority’s Water Revenue Refunding Bonds, Series 2024 (the “Bonds”). The Bonds are being issued pursuant to a Master Trust Agreement, dated as of November 1, 2008 (the “Master Trust Agreement”), between the Authority and U.S. Bank Trust Company, National Association, successor in interest to U.S. Bank National Association, as trustee (the “Trustee”), as supplemented and amended, including as supplemented and amended by a Third Supplemental Trust Agreement, dated as of October 1, 2024 (the “Third Supplemental Trust Agreement”, and together with the Master Trust Agreement as supplemented and amended, the “Trust Agreement”) between the Authority and the Trustee. The City covenants and agrees as follows:
Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the City for the benefit of the holders and Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying with Securities and Exchange Commission Rule 15c2-12(b)(5).
Section 2. Definitions. In addition to the definitions set forth in the Trust Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section 2, the following capitalized terms have the following meanings:
“Annual Report” means any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. “Beneficial Owner” means any person who has or shares the power, directly or indirectly, to make investment decisions concerning the ownership of any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries). “Disclosure Representative” means the City Treasurer/Director of Finance and Information Systems or such other officer or employee as the City shall designate in writing to the Dissemination Agent from time to time.
“Dissemination Agent” means U.S. Bank Trust Company, National Association, or any successor Dissemination Agent which may be designated in writing by the City and which has filed with the City a written acceptance of such designation. “EMMA” means the MSRB’s Electronic Municipal Market Access system. “Financial Obligation” shall mean, for purposes of the Listed Events set out in Section 5(a)(15) and Section 5(a)(16) of this Certificate, a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term “Financial Obligation” shall not include municipal securities (as defined in the Securities Exchange Act of 1934, as amended) as
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to which a final official statement (as defined in the Rule) has been provided to the MSRB consistent with the Rule.
“Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate.
“MSRB” means the Municipal Securities Rulemaking Board. “Official Statement” means the Official Statement relating to the Bonds. “Participating Underwriter” means RBC Capital Markets, LLC, the original underwriter of the Bonds required to comply with the Rule in connection with offering of the Bonds. “Report Date” means March 31 of each year, commencing March 31, 2025. “Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time.
Section 3. Provision of Annual Reports.
(a) The City shall, or shall cause the Dissemination Agent to, not later than the Report Date, provide to the MSRB through EMMA, in an electronic format and accompanied by such identifying information as is prescribed by the MSRB, an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than 15 business days before the Report Date, the City shall provide the Annual Report to the Dissemination Agent; provided that the City may distribute the Annual Report itself after providing written notice to the Dissemination Agent. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by cross-reference other information as provided in Section 4 of this Disclosure Certificate. The audited financial statements of the City may be submitted separately from the balance of the Annual Report, and later than the Report Date, if not available by the Report Date. If the City’s fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5. (b) If the City is unable to provide an Annual Report by the Report Date, the City shall provide or cause the Dissemination Agent to provide to the MSRB through EMMA a notice in substantially the form attached as Exhibit A.
(c) The Dissemination Agent shall:
(i) determine each year prior to the Report Date the applicable electronic format for filings through EMMA; and
(ii) to the extent the City has provided the Annual Report to the Dissemination Agent, file a report with the City and (if the Dissemination Agent is not the Trustee) the Trustee, certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided.
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Section 4. Content of Annual Reports. The City’s Annual Report shall contain or incorporate by reference the following:
(a) The audited financial statements of the City, which shall include financial statements of the City’s municipal water system (the “Water System”) for the prior fiscal year, prepared in accordance with Generally Accepted Accounting Principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the City’s audited financial statements are not available by the Report Date, the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. (b) Unless otherwise provided in the audited financial statements filed on or prior to the Report Date, financial information and operating data with respect to the City and the Water System for the preceding fiscal year, substantially as set forth in Exhibit B hereto.
Any or all of the items listed in Exhibit B may be included by specific reference to other documents, including official statements of debt issues of the City or related public entities, which are available to the public from the MSRB’s website or filed with the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the MSRB. The City shall clearly identify each such other document so included by reference.
Section 5. Reporting of Listed Events.
(a) Pursuant to the provisions of this Section 5, the City shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds, not later than ten (10) business days after the occurrence of the event:
1. principal and interest payment delinquencies;
2. non-payment related defaults, if material;
3. unscheduled draws on any applicable debt service reserves reflecting financial difficulties;
4. unscheduled draws on credit enhancement reflecting financial difficulties;
5. adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701 TEB) or other material notices or determinations with respect to the tax status of the Bonds or other material events adversely affecting the tax status of the Bonds;
6. modifications to rights of bondholders, if material;
7. substitution of credit or liquidity providers, or their failure to perform;
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8. bond calls, if material, and tender offers;
9. defeasances;
10. release, substitution or sale of property securing repayment of the Bonds, if material;
11. rating changes;
12. bankruptcy, insolvency, receivership or similar event of the Authority or the City;
13. the consummation of a merger, consolidation, or acquisition involving the Authority or the City or the sale of all or substantially all of the assets of the Authority or the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material;
14. appointment of a successor or additional Trustee or the change of name of the Trustee, if material;
15. incurrence of a Financial Obligation of the City, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a Financial Obligation of the City, any of which affect holders of the Bonds, if material; and
16. default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a Financial Obligation of the City, any of which reflect financial difficulties.
For the purpose of the event identified in Section 5(a)(12), the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the Authority or the City in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the Authority or the City, or if such jurisdiction has been assumed by leaving the existing governmental body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the Authority or the City.
(b) The Dissemination Agent shall, promptly upon obtaining actual knowledge at its office as specified in Section 12 hereof of the occurrence of any of the Listed Events, contact the Disclosure Representative, inform such person of the event, and request that the City promptly notify the Dissemination Agent in writing whether or not to report the event pursuant to subsection (f); provided that, failure by the Dissemination Agent to so notify the Disclosure
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Representative and make such request shall not relieve the City of its duty to report Listed Events as required by this Section 5.
(c) Whenever the City obtains knowledge of the occurrence of a Listed Event, whether because of a notice from the Dissemination Agent pursuant to subsection (b) or otherwise, the City shall as soon as possible determine if such event is required to be reported pursuant to this Section 5.
(d) If the City has determined that knowledge of the occurrence of a Listed Event is required to be reported pursuant to this Section 5, the City shall promptly notify the Dissemination Agent in writing. Such notice shall instruct the Dissemination Agent to report the occurrence pursuant to subsection (f).
(e) If in response to a request under subsection (b), the City determines that the Listed Event is not required to be reported pursuant to this Section 5, the City shall so notify the Dissemination Agent in writing and instruct the Dissemination Agent not to report the occurrence.
(f) If the Dissemination Agent has been instructed by the City to report the occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with the MSRB through EMMA in an electronic format and accompanied by such identifying information as is prescribed by the MSRB.
(g) The Dissemination Agent may conclusively rely on an opinion of counsel that the City’s instructions to the Dissemination Agent under this Section 5 comply with the requirements of the Rule.
(h) The City intends to comply with the Listed Events described in Section 5(a)(15) and Section 5(a)(16), and the definition of “Financial Obligation” in Section 2, with reference to the Rule, any other applicable federal securities laws and the guidance provided by the Securities and Exchange Commission in Release No. 34-83885 dated August 20, 2018 (the “2018 Release”), and any further amendments or written guidance provided by the Securities and Exchange Commission or its staff with respect the amendments to the Rule effected by the 2018 Release.
Section 6. Termination of Reporting Obligation. The City’s obligations under this Disclosure Certificate shall terminate (a) upon the legal defeasance, prior redemption or payment in full of all of the Bonds, or (b) if, in the opinion of nationally recognized bond counsel, the City ceases to be an “obligated person” (within the meaning of the Rule) with respect to the Bonds or the Bonds otherwise cease to be subject to the requirements of the Rule. If such termination occurs prior to the final maturity of the Bonds, the City shall give notice of such termination in the same manner as for a Listed Event under Section 5.
Section 7. Dissemination Agent.
(a) The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any
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such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by the City pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be U.S. Bank Trust Company, National Association. Any Dissemination Agent may resign by providing 30 days’ written notice to the City. The Dissemination Agent shall be paid compensation by the City for its services provided hereunder in accordance with the schedule of fees agreed upon by the City, as amended from time to time, and all reasonable expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder.
Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:
(a) If the amendment or waiver relates to the provisions of Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the Bonds, or type of business conducted; (b) The undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) The proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Trust Agreement for amendments to the Trust Agreement with the consent of holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the holders or Beneficial Owners of the Bonds.
If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions of this Section, the City shall describe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment, and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the City. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5, and (ii) the Annual Report for the year in which the change is made should present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.
Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that
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which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.
Section 10. Default. In the event of a failure of the City to comply with any provision of this Disclosure Certificate, the Trustee, at the written direction of any Participating Underwriter or the holders of at least 25% aggregate principal amount of Outstanding Bonds, shall, but only to the extent moneys or other indemnity, satisfactory to the Trustee, has been furnished to the Trustee to hold it harmless from any loss, costs, liability or expense, including fees and expenses of its attorneys and any additional fees of the Trustee or any holder or Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Trust Agreement, and the sole remedy under this Disclosure Certificate in the event of any failure of the City or the Dissemination Agent to comply with this Disclosure Certificate shall be an action to compel performance.
Section 11. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent and the Trustee shall have only such duties as are specifically set forth in this Disclosure Certificate, and the City, to the extent permitted by law, agrees to indemnify and save the Dissemination Agent, the Trustee, and their officers, directors, employees and agents, harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or performance of their powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s or the Trustee’s respective negligence or willful misconduct. The Dissemination Agent shall be paid compensation by the City for its services provided hereunder in accordance with its schedule of fees as amended from time to time and all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent and the Trustee shall have no duty or obligation to review any information provided to it by the City and shall not be deemed to be acting in any fiduciary capacity for the City, the Holders or any other party. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent, but shall terminate upon the termination of the City’s obligations under this Certificate pursuant to Section 6 of this Certificate.
Section 12. Notices. Any notice or communications to or among any of the parties to this Disclosure Certificate may be given as follows:
To the Authority: Brentwood Infrastructure Financing Authority c/o City of Brentwood
150 City Park Way
Brentwood, CA 94513
Attention: Director of Finance and
Information Systems
Telephone: (925) 516-5460
Fax: (925) 516-5401
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To the City: City of Brentwood
150 City Park Way
Brentwood, CA 94513
Attention: Director of Finance and
Information Systems
Telephone: 925-516-5440
Fax: (925) 516-5441
To the Trustee/Dissemination Agent U.S. Bank Trust Company, National Association
One California Street, Suite 1000
San Francisco, CA 94111
Attention: Global Corporate Trust Services
Fax: (415) 677-3768
To the Participating Underwriter: RBC Capital Markets, LLC Two Embarcadero Center, Suite 1200
San Francisco, CA 94111
Attention: Bob Williams
Fax: (415) 445-8674
Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent.
Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Trustee, the Dissemination Agent, the Participating Underwriter and holders and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.
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Section 14. Counterparts. This Disclosure Certificate may be executed in several counterparts, each of which shall be regarded as an original, and all of which shall constitute one and the same instrument.
Date: October __, 2024
CITY OF BRENTWOOD
By
Authorized Representative
ACCEPTED AND AGREED:
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Dissemination Agent
By
Authorized Representative
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EXHIBIT A
NOTICE OF FAILURE TO FILE ANNUAL REPORT
Name of Obligated Person: CITY OF BRENTWOOD
Name of Issue: $[PAR Amount] Brentwood Infrastructure Financing Authority, Water Revenue Refunding Bonds, Series 2024
Date of Issuance:
NOTICE IS HEREBY GIVEN that the City has not provided an Annual Report with respect to the above-named Bonds as required by the Continuing Disclosure Certificate dated October __, 2024, executed by the City of Brentwood, on its own behalf and on behalf of the Brentwood Infrastructure Financing Authority. The City anticipates that the Annual Report will be filed by ________________.
Dated:
DISSEMINATION AGENT
By:
Title:
cc: City of Brentwood
Trustee
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EXHIBIT B
ANNUAL REPORT
$[PAR AMOUNT]
BRENTWOOD INFRASTRUCTURE FINANCING AUTHORITY
WATER REVENUE REFUNDING BONDS
SERIES 2024
Date of this Annual Report: ___________
For Fiscal Year: __________
This Annual Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate (the “Disclosure Certificate”) dated October __, 2024, executed by the undersigned (the “City”) for and on behalf of itself and the Brentwood Infrastructure Financing Authority (the “Authority”) in connection with the issuance of the above-captioned bonds by the Authority.
Capitalized terms used in this Annual Report but not otherwise defined have the meanings given to them in the Disclosure Certificate.
I. Audited Financial Statements
Attached are audited financial statements of the City, which include financial statements of the City's municipal Water System (the “Water System”) prepared in accordance with Generally Accepted Accounting Principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board.
II. Financial Information and Operating Data of the Water System Unless otherwise provided in the audited financial statements, an update for the prior fiscal year of the financial information and operating data with respect to the Water System of the following type (or information comparable thereto) included in the Official Statement relating to the Bonds:
a) The information in Appendix A to the Official Statement under the caption “Rate Structure.”
b) Table 2 of Appendix A to the Official Statement entitled “City of Brentwood – Water Rates Per Billing Unit Per Month.”
c) Table 3 of Appendix A to the Official Statement entitled “City of Brentwood - Customer Accounts as a Percentage of Revenues.”
d) Table 7 of Appendix A to the Official Statement entitled “City of Brentwood – Top Water System Accounts.”
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e) Table 8 of Appendix A to the Official Statement entitled “City of Brentwood - Historical Net Water Revenues and Debt Service Coverage.” III. Additional Information, as needed
OH&S DRAFT: 08/22/2024
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APPENDIX D
ECONOMIC AND DEMOGRAPHIC INFORMATION FOR THE CITY OF BRENTWOOD The following information concerning the City and surrounding areas are included only for the purpose of supplying general information regarding the community. The 2024 Bonds are limited obligations of the Authority and are not secured by a legal or equitable pledge of, or charge or lien upon, any property of the Authority or any of its income or receipts, except the Revenues. The full faith and credit of neither the Authority nor the City is pledged for the payment of the interest on or principal of the 2024 Bonds and no tax or other source of funds, other than the Revenues, is pledged to pay the interest on or principal of the 2024 Bonds. The payment of principal of or interest on the 2024 Bonds does not constitute a debt, liability or obligation of the Authority or the City for which any such entity is obligated to levy or pledge any form of taxation or for which any such entity has levied or pledged any form of taxation. The Authority has no taxing power. See “SECURITY FOR THE 2024 BONDS” in the forepart of this Official Statement.
The City is located in eastern Contra Costa County (the “County”) across the San Francisco Bay approximately 55 miles east of San Francisco, 62 miles south of Sacramento and borders the City of Antioch on the northwest. The City contains approximately 14.83 square miles in total area and has an estimated population of 64,811 as of January 1, 2024.
The City was first settled by farmers in 1878. Until the past couple of decades, the City retained its agricultural orientation. Over the past two decades, new residential subdivisions have transformed the City into a more suburban environment, as evidenced by its population growth. Land uses in and around the City are characterized by older farming districts and an original downtown area, contrasted with expanding residential neighborhoods in the peripheral areas of the City.
The City enjoys close proximity to major regional employment areas, including San Francisco and the northern Bay Area, Walnut Creek and the San Ramon corridor in Contra Costa County, the Livermore and Pleasanton corridor in Alameda County to the south and the Stockton and central San Joaquin Valley area to the east. The City also enjoys close proximity to major regional recreation areas, including Mt. Diablo State Park approximately 15 miles to the west, the Sierra Nevada Mountains 90 miles to the east and the Sacramento Delta waterway to the north. Interstate Highways 580 and 680 are approximately one half hour’s drive from the City’s downtown area, depending on traffic. The City’s main roads connect directly with California Highway 4 which provides convenient access to the City.
Municipal Government
The City was incorporated in 1948 as a general law city. The City government is made up of council members elected from four geographical districts and serve four-year overlapping terms, at elections held every two years. The mayor is directly elected at-large to serve a four-year term. A city manager is appointed by the council and mayor to administer daily affairs of the City and to implement policies established by the council.
Municipal functions include police protection, water service, highways and streets, sanitation, solid waste disposal services, youth services, public improvements, parks and recreation services, community development and general administrative services. The City has approximately 339 full-time equivalent employees.
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Population
The City is located in the eastern portion of the County. The City’s population as of January 1, 2024 was 64,811, as estimated by the State Department of Finance.
Set forth below is comparative historical and projected population data for the City and County, respectively.
HISTORICAL CITY, COUNTY AND STATE POPULATION DATA
Year(1)
City of
Brentwood
Percent
Change
Contra Costa
County
Percent
Change
State of
California
Percent
Change
2010 52,152 -- 1,061,578 -- 37,552,880 --
2011 52,822 1.3% 1,075,165 1.3% 37,904,303 0.9%
2012 54,062 2.3 1,090,305 1.4 38,237,859 0.9
2013 55,545 2.7 1,104,732 1.3 38,513,119 0.7
2014 57,220 3.0 1,120,530 1.4 38,810,306 0.8
2015 59,065 3.2 1,136,478 1.4 39,036,749 0.6
2016 60,858 3.0 1,147,957 1.0 39,273,915 0.6
2017 62,324 2.4 1,155,105 0.6 39,429,439 0.4
2018 63,564 2.0 1,161,077 0.5 39,503,656 0.2
2019 64,204 1.0 1,164,844 0.3 39,535,623 0.1
2020 64,534 0.5 1,162,336 (0.2) 39,327,868 (0.5)
2021 64,228 (0.5) 1,149,841 (1.1) 39,114,785 (0.5)
2022 64,496 0.4 1,145,274 (0.4) 39,061,058 (0.1)
2023 64,811 0.5 1,146,626 0.1 39,128,162 0.2
_______________
Sources: State of California, Department of Finance, E-4 Population Estimates for Cities, Counties and the State, 2011-2020, with 2010 Census Counts; State of California, Department of Finance, E-5 City/County Population and Housing Estimates for years 2020-2023; State of California, Department of Finance, E-5 County/State Population and Housing Estimates for years 2021-2024. (1) All estimates are as of January 1 of the following year.
Prior to the 1970’s, the City’s growth lagged behind growth in the County as a whole because development was centered in the western portion of the County. As development activity moved eastward during the 1970’s, population in the City began to grow sharply, outpacing growth in the County.
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Employment
The following table lists some of the major employers in Contra Costa County in alphabetical order:
CONTRA COSTA COUNTY
Major Employers
Employer Name Location Industry
Bay Area Rapid Transit Richmond Transit Lines
Bio-Rad Laboratories Inc Hercules Physicians & Surgeons Equipment & Supplies Manufacturers
C & H Sugar Crockett Sugar Refiners (Mrfs)
Chevron Corp San Ramon Crude Oil-Petroleum Refiners (Mrfs) Contra Costa County Health Services Martinez Government Offices Contra Costa Regional Medical Center Martinez Hospitals Crash Champions Collision Concord Automobile Body Repairing and Painting Home and Hospital Program Concord Educational Service-Business John Muir Health Concord Med Concord Hospitals
Kaiser Permanente Antioch Med Antioch Hospitals
Kaiser Permanente Martinez Med Martinez Clinics
La Raza Market Richmond Grocers-Retail
Los Medanos College Pittsburg Junior Community College Tech Institutes Macias Gini & O'Connell LLP Walnut Creek Accountants
Martinez Arts Outpatient Clinic Martinez Physicians and Surgeons Martinez Refining Co LLC Martinez Crude Oil-Petroleum Refineries Nordstrom Walnut Creek Department Stores
Oakley Union School District Oakley School Districts
Phillips 66 Rodeo Service Stations-Gasoline & Oil
Phillips 66 San Francisco Refinery Rodeo Crude Oil-Petroleum Refineries Robert Half San Ramon Employment Agencies & Opportunities San Ramon Regional Medical Center San Ramon Hospitals
Sutter Delta Medical Ctr Antioch Hospitals
USS-Posco Industries Pittsburg Steel Mills (Mfrs)
_______________
Source: California Employment Development Department, extracted from the America’s Labor Market Information System (ALMIS) Employer Database, 2024 2nd Edition.
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The County and Alameda County comprise the Oakland-Hayward-Berkeley Metropolitan Division. The civilian labor force, employment and unemployment for the County is outlined in the following table.
OAKLAND-HAYWARD-BERKELEY METROPOLITAN DIVISION
(Alameda and Contra Costa Counties)
Employment and Unemployment of
Industry Employment and Labor Force*
2019 2020 2021 2022 2023
Civilian Labor Force 1,401,500 1,364,400 1,354,000 1,367,400 1,376,700 Employment 1,359,000 1,242,300 1,270,000 1,320,400 1,320,300 Unemployment 42,500 122,100 84,000 47,100 56,400
Civilian Unemployment Rate:
Oakland-Hayward-Berkeley
MD
3.0%
9.0%
6.2%
3.4%
4.1%
State of California 4.1% 10.1% 7.3% 4.3% 4.8%
_______________
*Totals may not be precise due to rounding. Annual averages for all categories.
Source: Employment Development Department, State of California Labor Market Information Division.
A breakdown of the labor force by industry in the Oakland-Hayward-Berkeley Metropolitan Division is set forth in the following table.
OAKLAND-HAYWARD-BERKELEY METROPOLITAN STATISTICAL AREA
Wage And Salary Workers By Industry
Annual Averages*
2019 2020 2021 2022 2023
Total Farm 1,400 1,500 1,700 1,900 1,900
Mining and Logging 200 200 200 300 300
Construction 75,600 71,100 74,300 75,400 75,100
Manufacturing 101,000 98,700 106,000 112,300 111,900
Wholesale Trade 45,400 42,100 41,100 41,500 41,400
Retail Trade 112,000 101,500 105,300 106,200 105,600
Transportation, Warehousing & Utilities 43,700 45,200 49,500 54,500 54,400 Information 27,600 25,600 24,700 25,000 24,200
Finance & Insurance 37,200 35,900 34,800 33,600 32,300
Real Estate & Rental & Leasing 18,100 16,800 17,200 18,400 18,400 Professional & Business Services 193,200 184,900 190,700 195,500 189,500 Education & Health Services 198,400 191,300 198,500 205,800 216,500 Leisure & Hospitality 121,000 84,700 92,500 108,300 112,100 Other Services 41,200 33,100 35,600 39,200 41,300
Government 174,800 165,900 161,100 161,400 164,900
Total All Industries* 1,190,800 1,098,500 1,133,200 1,179,300 1,189,800 _______________
* Totals may not be precise due to independent rounding.
Source: Employment Development Department, State of California Labor Market Information Division.
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Utilities
Gas and electric service in the City is provided by Pacific Gas & Electric. Telephone service is provided by Pacific Bell. Water is supplied by City wells and the Contra Costa County Water District through the City water lines and filtration plant. Sewer service is supplied by the City.
Education
The City is part of the Brentwood and Liberty Union School Districts which provide K-12 public education needs. There are four high schools, three middle schools, and eight elementary schools located in the City.
Near the City are four colleges, Los Medanos Community College in Pittsburg, Diablo Valley Community College in Concord, San Joaquin Delta Community College and University of the Pacific in Stockton. Los Medanos Community College also has an extension campus located in the City.
Transportation
The City, located near the Cities of Antioch and Stockton, is in close proximity to a highly developed transportation network. The City’s main roads connect directly with State Highway 4 which intersects with Interstate 680 near Martinez and Interstate 80 in Hercules. To the east, Highway 4 leads to Stockton where it intersects with Interstate 5. The highways provide the City with access to major regional workplace and recreation areas. The City is close to both regional and international airports — Concord Airport, Stockton Airport and Oakland International Airport.
Proximity to Major Urban Centers
Proximity Distance
Antioch to Brentwood 5 miles
Concord to Brentwood 26 miles
Livermore to Brentwood 24 miles
Oakland to Brentwood 46 miles
Stockton to Brentwood 37 miles
San Francisco to Brentwood 54 miles
Sacramento to Brentwood 75 miles
_____________
Source: City of Brentwood
The City is also served by bus lines and railroads. Bay Area Rapid Transit (“BART”) provides eBART rail service from Antioch connecting to the Pittsburg BART station. Tri Delta Transit Express Route 300 provides limited-stop service from Brentwood, Oakley and Antioch to the Pittsburg BART station. In addition, Tri Delta Transit Commuter Route 300x provides a fast weekday route between Brentwood, Oakley and the Antioch BART station, with only 3 stops along the way. BART serves cities in San Francisco Peninsula and communities in the East Bay and South Bay, including service to and from the San Francisco International Airport. A BART train extension also provides service between the Oakland Coliseum BART station and the Oakland International Airport.
CITY COUNCIL AGENDA ITEM NO. H.2
09/10/2024
SUBJECT: Introduction and Waiver of First Reading of an Ordinance Amending the Brentwood Municipal Code to allow Pad-Mounted Transformers within Development Projects.
DEPARTMENT: Engineering
STAFF: Allen Baquilar, Director of Engineering/City Engineer Vatsal Patel, Engineering Manager
TITLE/RECOMMENDATION
Introduce and waive the first reading of an ordinance to amend Brentwood Municipal Code Section 16.120.120, allowing Permittees to install pad-mounted transformers within development projects while the City monitors the nationwide supply chain issues related to underground transformers.
The proposed ordinance is not an action subject to the California Environmental Quality Act (CEQA), as the action has no potential for resulting in physical change to the environment. (14 Cal. Code. Regs. § 15358.) Further, adoption of the ordinance is exempt under CEQA because it will not cause a change in any of the physical conditions within the area affected by the ordinances. (14 Cal. Code Regs. § 15061(b)(3).)
FISCAL IMPACT
There is no anticipated direct fiscal impact as a result of the adoption of an ordinance amending BMC Section 16.120.120, to allow residential and commercial development projects that include land subdivision to receive building permits.
BACKGROUND
The Subdivision Map Act (Government Code Section 66410, et seq.) is a California state law that authorizes local governments, such as city councils, to regulate and control the design and improvement of subdivisions of land. To carry out this power, each local government, including the City of Brentwood, passes its own subdivision ordinance, which sets out the requirements imposed on developers in exchange for the privilege of subdividing their land.
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One of these requirements is found in Brentwood Municipal Code (“BMC”) Section
16.120.120(A)(1), which states:
Utility distribution facilities, including, but not limited to, electric, communication, street lighting and advanced technology systems installed in and for the purpose of supplying service to any development, shall be required to be placed underground. "Advanced technology systems" shall be defined as all necessary appurtenances, equipment and facilities required for the provision of Internet, computer, fiber optic, cable television, telephone, and other communication services within the public right-of-way and upon private property. The design, installation, inspection and testing requirements for city acceptance of such system shall meet the minimum requirements as outlined in the city of Brentwood standard plans and specifications as approved by the city engineer. The developer shall also dedicate to the city that portion of the system within the public right-of-way and shall dedicate to the property owner the portion of the system within the private property.
As written, this includes all Pacific Gas & Electric Company (“PG&E”) electric transformers, and requires that they be placed underground.
Electric distribution transformers serve an important role in converting or stepping down currents from power lines rated at 300,000 to 750,000 volts to lower voltages for consumer use, typically just 110 to 250 volts, with higher voltages for commercial and industrial use. Without transformers, residents and businesses would not be able to receive electricity.
In order for transformers to be installed beneath the surface, developers are dependent upon the availability of the necessary undergrounding equipment, including subsurface transformers. Recent years have seen a shortage in these materials for a variety of reasons, including factory shutdowns and supply chain delays at the height of the COVID pandemic, increasing construction demand, and shipping disruptions as overseas manufacturers attempt to get their products to US markets. PG&E estimates January 2028 as the earliest availability of subsurface transformers, whereas surface (pad-mounted) transformers are typically now available within 6-9 months after PG&E approval of plans.
On March 26, 2024, the City Council adopted an interim urgency ordinance authorizing the City Engineer to allow pad-mounted transformers for projects subject to BMC Section 16.120.120 (‘Undergrounding—Electric, communication, street
CITY COUNCIL AGENDA ITEM NO. H.2
09/10/2024
lighting and advanced technology systems’) with additional screening requirements for residential applications and discussed the adoption of an ordinance to allow for this process.
On May 8, 2024, the City Council adopted an extension of the interim urgency ordinance for a further ten months and fifteen days (expiring March 26, 2025) and directed staff to include restrictions as to the size of pad-mounted transformers within residential developments as part of the ordinance.
The design of electrical distribution systems, which includes electric transformers for residential developments, must comply with general safety, accessibility, and environmental standards as outlined by State regulations such as the California Electrical Code, Fire Code, and Building Code. PG&E is responsible for planning, designing, and engineering its service facilities using company standards for design, materials, and construction. These standards focus on safety, accessibility, voltage limits, and installation requirements rather than specific size restrictions for transformers in residential or commercial settings.
Staff has researched various other City requirements throughout the Bay Area and Southern California and was not able to find an example of another City with a size restriction on transformers.
Staff has verified the pad-mounted residential transformer dimensions found in neighboring cities have dimensions of approximately 34 inches (L) x 37 inches (W) x 25 inches (H), which is consistent with what would be expected for residential development in Brentwood and is rated to provide between 15 kiloVolt-Amps (kVA) to 50 kVA of electricity to homes, which is typical for residential development.
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Figure 1: Examples of Pad-Mounted Transformer Installations PG&E would be subject to requirements set forth by the City and based on City Council’s direction, staff is including a restriction on pad-mounted transformers to not exceed a height of 26 inches when placed on or between residential lots.
NEXT STEPS
This action would introduce and waive the first reading of an ordinance to modify BMC 16.120.120 as set forth in the ordinance. The ordinance differs from the urgency ordinance in that it sets forth more explicit instructions for compliance with screening requirements and a height limit on transformers in residential settings.
Staff will continue to monitor the availability of subsurface transformers and its supply chain issues and return to the City Council with an update should supply chain issues resolve prior to March 26, 2025.
CITY COUNCIL STRATEGIC INITIATIVE
Not Applicable.
PREVIOUS ACTION
Previous Action by the City Council is included on Attachment 1.
DATE OF NOTICE
Not Applicable.
CITY COUNCIL AGENDA ITEM NO. H.2
09/10/2024
ENVIRONMENTAL DETERMINATION
The ordinance is not an action subject to the California Environmental Quality Act (CEQA), as the action has no potential for resulting in physical change to the environment. (14 Cal. Code. Regs. § 15358.) Further, adoption of the ordinance is exempt under CEQA because they will not cause a change in any of the physical conditions within the area affected by the ordinance. (14 Cal. Code Regs. § 15061(b)(3).)
ALTERNATIVE OPTION(S)
Alternative Options to the Staff Recommendation:
1. Do not approve staff’s recommendation. The interim urgency ordinance will continue to be in effect until March 26, 2025. Thereafter, or unless otherwise extended, developers will not be able to receive timely full approval of their joint trench plans until underground transformers are available, halting all development until supply issues are resolved, or until separate Planning Commission and City Council consideration is completed (which may not be feasible in all cases).
ATTACHMENT(S)
1. Previous Action
2. Ordinance Amending BMC Section 16.120.120
Attachment 1
PREVIOUS ACTION
Previous actions related to this agenda item that were taken by the Council are listed below. To view prior actions and materials, and Brentwood Municipal Code references in the staff report, as applicable:
Visit www.brentwoodca.gov/meetings, and select the meeting date(s) desired to see the reference materials and videos.
Visit www.brentwoodca.gov/municipalcode to research references to the Brentwood Municipal Code and search by the code section(s) cited.
On March 26, 2024, by Ordinance No. 1072, the City Council adopted an interim urgency ordinance authorizing the City Engineer to allow pad-mounted transformers for projects applicable to BMC Chapter 16.120.120 with additional screening requirements for residential applications.
On May 8, 2024, by Ordinance No. 1074, the City Council adopted an extension of interim urgency ordinance authorizing the City Engineer to allow pad-mounted transformers for projects applicable to BMC Chapter 16.120.120 with additional screening requirements for residential applications.
ORDINANCE NO. ____
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
BRENTWOOD AMENDING BRENTWOOD MUNICIPAL CODE
SECTION 16.120.120 TO AUTHORIZE THE CITY ENGINEER TO
WAIVE LIMITED UNDERGROUND UTILITY REQUIREMENTS,
FINDING THE ACTION EXEMPT FROM CEQA, AND TERMINATING
URGENCY ORDINANCE NO. 1074.
WHEREAS, the City of Brentwood (“City”) presently requires development projects that include a land subdivision to install utility distribution facilities, including, but not limited to, electric, communication, street lighting and advanced technology systems installed in and for the purpose of supplying service to any development, to be placed underground as governed by Chapter 16.120.120 of the Brentwood Municipal Code (“BMC”); and
WHEREAS, according to multiple media sources, as well as developer and industry testimonials, the construction industry is currently experiencing a severe shortage of subsurface electric distribution transformers; and WHEREAS, the causes for this shortage are complex, and include increases in demand for such facilities due to growth in EV charger installation and the use of renewable energy sources, federal investment, storms and political events that have disrupted the global supply chain, the imposition of tariffs on foreign transformers, and the impacts of the COVID pandemic; and
WHEREAS, the lead time for the receipt of subsurface electric distribution transformers may delay the completion of construction projects by years if this requirement continues to be implemented; and
WHEREAS, the City Council of the City of Brentwood is authorized, pursuant to Article 11, Section 7 of the California Constitution, to make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws; and
WHEREAS, on March 26, 2024, the City Council adopted Urgency Ordinance No.1072, amending Brentwood Municipal Code Section 16.120.120 to authorize the City Engineer to waive limited underground utility requirements and find the act exempt from CEQA; and
WHEREAS, on May 8, 2024, the City Council adopted Urgency Ordinance No.1074, extending Urgency Ordinance No. 1072 for a period of an additional 10 months and 15 days, unless terminated earlier; and
WHEREAS, the City desires to enact this ordinance in order to establish enduring requirements with respect to the placement of utilities underground or above ground.
NOW, THEREFORE, the City Council of the City of Brentwood does ordain as follows:
SECTION 1. Brentwood Municipal Code is hereby amended to read as provided in Exhibit A, attached hereto and incorporated herein. Deleted language is struckthrough; additional language is underlined.
SECTION 2. This ordinance will be published in accordance with Government Code Section 36933 by either posting or publishing the ordinance in accordance with that law.
SECTION 3. The City Clerk is requested to cause the amended language of Brentwood Municipal Code Section 16.120.120 as quoted in Exhibit A, to be entered in the City of Brentwood Municipal Code.
SECTION 4. If any exhibit, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid or unconstitutional by the decision of a court of competent jurisdiction, the holding will not affect the validity or enforceability of the remaining provisions, and the City Council declares that it would have adopted each provision of this ordinance irrespective of the validity of any other provision.
SECTION 5. The proposed Ordinance is exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15061(b)(3) – Common Sense Exemption - in that the proposed ordinance would only establish and clarify administrative processes and would not facilitate new construction or other groundbreaking activities. There is no potential to result in either a direct physical change to the environment or a reasonably foreseeable indirect physical change to the environment.
SECTION 6. This ordinance will take effect and be in force 30 days following its adoption, at which time Urgency Ordinance No. 1074 shall be repealed and shall no longer be in effect.
THE FOREGOING ORDINANCE was introduced with the first reading waived at a regular meeting of the Brentwood City Council on the 10th day of September, 2024, by the following vote:
EXHIBIT ‘A’
BRENTWOOD MUNICIPAL CODE
TITLE 16 (‘Subdivisions and Land Development’)
§ 16.120.120 Undergrounding—Electric, communication, street lighting and advanced technology systems.
A. General Provisions.
1. Utility distribution facilities, including, but not limited to, electric, communication, street lighting and advanced technology systems installed in and for the purpose of supplying service to any development, shall be required to be placed underground, except as otherwise permitted by this Section
16.120.120. "Advanced technology systems" shall be defined as all necessary appurtenances, equipment and facilities required for the provision of Internet, computer, fiber optic, cable television, telephone, and other communication services within the public right-of-way and upon private property. The design, installation, inspection and testing requirements for city acceptance of such system shall meet the minimum requirements as outlined in the city of Brentwood standard plans and specifications as approved by the city engineer.
The developer shall also dedicate to the city that portion of the system within the public right-of-way and shall dedicate to the property owner the portion of the system within the private property.
2. All existing facilities except transmission facilities either along abutting streets or within a development shall also be underground at the time of development. "Along abutting streets" means on the same side of the abutting street as the property being developed, not the other side of the street.
3. The developer is responsible for complying with all requirements of this subsection, and shall make the necessary arrangements with the utility companies for the installation of such facilities.
4. The city council, following the consideration by the planning commission, may waive undergrounding requirements if unusual topographical, soil or any other unusual problems (such as prolonged supply chain delays) make such underground installations unreasonable or impractical in accordance with the following:
a. If the requirement to underground utilities is waived, the city council may require the recordation of an improvement agreement, requiring the property owner and any subsequent owner of the subject property to join an underground utility assessment district, reimbursement district or similar improvement district, when such a district is formed, and to guarantee participation in such district by posting an improvement bond and recording a lien on subject property.
b. The affected developer or any utility company may submit information supporting a request for such waivers.
c. No waiver shall be granted in any undergrounding district previously established.
d. In the event such a waiver is granted as to a residential development, the developer shall be responsible for installing screening consisting of dense landscaping and/or wall(s) with a concrete apron meeting all PG&E requirements on at least three sides of the surface-mounted equipment to the satisfaction of the City Engineer.
5. The City Engineer may waive undergrounding requirements as to equipment appurtenant to underground facilities (such as surface-mounted transformers, pedestal-mounted terminal boxes and meter cabinets, and concealed ducts) if unusual topographical, soil, or any other unusual problems (such as prolonged supply chain delays) make such underground installations unreasonable or impractical in accordance with the following:
a. The affected developer or any utility company may submit information supporting a request for such waiver.
b. In the event such a waiver is granted as to a residential development, the developer shall be responsible for installing screening consisting of dense landscaping and/or wall(s) with a concrete apron meeting all PG&E requirements on at least three sides of the surface-mounted equipment to the satisfaction of the City Engineer.
c. The City Engineer’s authority to waive such requirement shall sunset on December 31, 2028, unless otherwise amended by the city council.
B. Electric, Communication, Street Lighting and Advanced Technology Systems. All costs of placing existing or new facilities, required to be undergrounded by the developer, shall be paid for by the developer subject to the current California Public Utility Commission rules and regulations.
C. Advanced Technology Systems.
1. The developer shall design, install, test and dedicate to the city two advanced technology system conduits, size to be determined, within the public right-ofway. The developer shall install, in one of the conduits, a fiber optic system designed to serve the subject development for use by the city of Brentwood or one of its licensed franchisee. The fiber optic system shall be installed in accordance with the citywide advance technology master plan and approved by the city engineer. The second conduit shall remain empty and shall be reserved to serve the subject development for the use of a city licensed franchisee not wishing to utilize the city's fiber optic system. Both conduits
shall be installed to each lot line. The developer shall bear all design, construction, inspection, and testing costs associated with these underground requirements. Furthermore, the developer shall design, install, test and dedicate to the city all necessary components of the advanced technology system as depicted on the citywide advanced technology master plan.
2. The developer shall design, install, test and dedicate to the property owner two advanced technology system conduits, size to be determined, to connect the public advanced technology system to the individual home or building. The developer shall install, in one of the conduits, a fiber optic system designed to serve the subject property. The fiber optic system shall be installed in accordance with the citywide advance technology master plan and approved by the city engineer. The second conduit shall remain empty and shall be reserved to serve the subject property for the use of a city licensed franchisee not wishing to utilize the city's fiber optic system. The developer shall bear all design, construction, inspection and testing costs associated with these underground requirements.
3. The cable television or advanced technology company franchisee that elects to install facilities in the city's vacant conduit shall provide plans and specifications to the developer and the city of Brentwood. The licensed franchisee shall also inspect the facilities and certify to the city prior to final approval of the development that the cable television facilities or advanced technology systems are properly installed and serviceable. The design and installation shall meet the minimum criteria as outlined in the city of Brentwood standard plans and specifications.
(Ord. 471 § 3, 1990; Ord. 609, 1999)
CITY COUNCIL AGENDA ITEM NO. H.3
09/10/2024
SUBJECT: Review of City Council and Commission process for public comments to reduce hate speech and the use of virtual platforms for public comments; and consider drafting a statement of values DEPARTMENT: City Manager’s Office
STAFF: Darin Gale, Assistant City Manager
Tim Ogden, City Manager
TITLE/RECOMMENDATION
Provide direction to staff regarding the process for public comments made at City Council and Commission meetings and the use of virtual platforms for public comments; and direct to staff to work with the Diversity, Equity, Belonging and Inclusion Committee to draft a City Council statement of values.
FISCAL IMPACT
There is no fiscal impact associated with this action at this time.
BACKGROUND
On October 1, 2023, the City Council updated the City Council Meeting Rules and Procedures Policy and provided direction to staff to allow for continued virtual public comments for agenized items only. Public comments on items not on the agenda would be take in person only, to protect the City from what is described by many as being “Zoom bombed” with hate speech. Based upon the current process, the City was protected from being Zoom bombed with hate speech on three separate occasions.
At the March 12, 2024, City Council meeting, a future agenda item was approved to spend staff time and resources to determine what additional steps could be taken to limit hate speech during City Council meetings, allow for virtual public comments and create a City value or mission statement. Staff reviewed a number of steps that have been taken around the region and throughout the state to limit hate speech during public comments. In reviewing other city processes referenced by the City Council, staff was unable to find a staff report or council meeting where legal counsel
CITY COUNCIL AGENDA ITEM NO. H.3
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supported a process that recommended restricting a person from exercising their First Amendment rights.
It is important to note that the First Amendment to the U.S. Constitution protects most forms of speech or expression in a limited public forum such as City Council meeting, providing:
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.
The City Council’s current public comment framework does not infringe upon this right. Members of the public who choose not to attend City Council or City Commission meetings may still express themselves regarding items not on the agenda through a number of avenues, including email, traditional mail, and telephonic messages.
The United States Supreme Court has found that “speech on public issues occupies the ‘highest rung of the hierarchy of First Amendment values’ and is entitled to special protection.” (Snyder v. Phelps (2011) 562 U.S. 443, 452, internal citations omitted.) According to the Court:
Speech deals with matters of public concern when it can “be fairly considered as relating to any matter of political, social, or other concern to the community,” [citation omitted] or when it “is a subject of legitimate news interest; that is, a subject of general interest and of value and concern to the public.” [Citations omitted.] The arguably “inappropriate or controversial character of a statement is irrelevant to the question whether it deals with a matter of public concern.” In addition, the Brown Act (the State’s open meeting law) specifically protects speakers at public meetings who wish to criticize the body’s policies, procedures, programs, or services of the agency, or the acts or omissions of the legislative body. (Government Code § 54954.3(c).) The Brown Act specifically addresses meeting disruptions in a number of ways:
1. Adoption of reasonable regulations. The law allows bodies subject to the Act to adopt reasonable regulations to ensure that the public has the opportunity to address the body and individuals do not disrupt the
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proceedings. These regulations may include rules limiting the total amount of time allocated for public testimony on particular issues and for each individual speaker. (Government Code § 54954.3(b)(1).) In the context of a limited public forum, such as a public meeting, such regulations are reviewed for whether they constitute reasonable time, place, and manner restrictions, and any content-based prohibitions must be narrowly drawn to carry out a compelling governmental interest. (See, e.g., Kindt v. Santa Monica Rent Control Board (1995) 67 F.3d 266, 271, finding that “limitations on speech at those meetings must be reasonable and viewpoint neutral, but that is all they need to be.”)
2. Removal of disruptive speakers. The law also allows for speakers to be removed if the speaker’s behavior is disrupting the meeting and the speaker does not heed a warning to cease such behavior. (Government Code § 54957.95.) Under these provisions, “disrupting” is very narrowly defined to mean:
engaging in behavior during a meeting of a legislative body that actually disrupts, disturbs, impedes, or renders infeasible the orderly conduct of the meeting and includes, but is not limited to, one of the following:
(A) A failure to comply with reasonable and lawful regulations adopted by a legislative body pursuant to [Government Code] Section 54954.3 or any other law.
(B) Engaging in behavior that constitutes use of force or a true threat of force.
For these purposes, a “true threat of force” is “a threat that has sufficient indicia of intent and seriousness, that a reasonable observer would perceive it to be an actual threat to use force by the person making the threat.”
3. Clearing disruptive groups. Moreover, if a group or groups of individuals interrupt a public meeting subject to the Brown Act “so as to render the orderly conduct of such meeting infeasible and order cannot be restored by the removal of individuals who are willfully interrupting the meeting,” the body’s members may order the meeting room cleared in order to allow the meeting to continue. In that event, members of the press or other news
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media (except those participating in the disturbance) must be allowed to attend the meeting as it continues. (Government Code § 54967.9.) Notably, the Brown Act does not define – or explicitly prohibit - ‘hate speech.’ Working within this legal framework, cities are left with a limited array of tools to combat hate speech. Cities can encourage speakers to engage in constructive, rather than abusive, dialogue. Councils can also model good behavior by remaining civil and constructive, even when there are disagreements. What the Council cannot do is entirely stop or stifle constitutionally protected speech it disagrees with, even if that speech is inconsistent with the Council’s norms for civil discourse. However according to at least one California Attorney General opinion1, the legislative body of a local agency may prohibit members of the public, who speak during the time permitted on the agendas for public expression, from commenting on matters that are not within the subject matter jurisdiction of the legislative body.
Currently, the City Council allows public comment to occur both in person and virtually through Zoom for all agenized items, but does not allow Zoom public comments for items not on the agenda. The vast majority of verbal attacks across the state and country have occurred virtually, not in person, and during public comments for items not on the agenda. The City is not required to offer public participation via Zoom or any other virtual platform when public meetings are taking place and all members are participating in person. Virtual participation was instituted during the early days of the pandemic, when it was judged unsafe to meet in person and the public needed a way to participate; it has been carried over as a courtesy by the City Council. The majority of local governments across the state are not allowing virtual public comments at this time.
Options to reduce opportunities for hate speech
The City Council is in support of continuing to allow for virtual public comment for items on the agenda and expressed interest in expanding virtual comment for items not on the agenda. Below are options for the City Council to consider. None of the options below will stop future hate speech entirely, but are rather tools that might discourage or protect residents from having to listen to the comments.
1 78 Ops. Cal. Atty Gen. 224 (1995)
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Option Action Discussion
A Include a statement discouraging
hate speech on the agenda and
have the Mayor or Chair read the
statement at the beginning of each
meeting and repeat the statement
as needed during the meeting.
Attachment 2 includes examples of
statements for City Council
consideration.
B For all public comments, enforce
City Council/Administrative Policy
110-1 (‘Meeting Rules &
Procedures’), Section 5.2 (‘Rules of
Decorum’), which requires, among
other things, that “[t]he comments
must be pertinent to the agenda
item under discussion.”
Often during City Council meetings,
speakers stray from addressing
items on the agenda. Ensuring the
Council’s Meetings Rules &
Procedures are followed with all
speakers is key in discouraging
hate speech.
C Require verified Zoom accounts for
all virtual comments.
This has not been shown to be
effective in other communities and
could hinder individuals from
participating virtually if they do not
regularly use Zoom.
D Require both registration and
authentication on Zoom prior to the
start of a meeting.
Authentication allows the City to
restrict webinar attendees to signin users only, confirming that they have a legitimate email account.
This registration allows the City to
view and manage the registrants,
be aware of how many will
potentially join, and it ensures that
attendees do not share their
attendance link with others
This process would limit ability of
virtual comments if someone did
not register prior to the start of a
meeting. It also would not allow
the City to prohibit speakers on the
basis of their email address.
E Report all virtual hate speech to
Zoom.
Staff can report hate speech to
Zoom but it will not stop a person
from making inappropriate
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Option Action Discussion
comments or creating a new
account to log into Zoom.
F Move public comments for items not
on the agenda to the end of the
meeting.
Most cases of virtual hate speech
happen at the start of the meeting
and not at the end. Moving public
comments to the end could hinder
the ability of individuals to
participate virtually as most Council
meetings adjourn after 10 p.m.
City Council Statement of Values
As part of the motion for this future agenda item, the City Council discussed the possibility of adopting a “Statement of Values.” If the City Council desires a Statement of Values, it is recommended that the City Council either appoint two council members to a new Ad Hoc Committee or assign the effort to the Diversity, Equity, Belonging and Inclusion (DEBI) Committee to draft a Statement of Values for future City Council consideration.
CITY COUNCIL STRATEGIC INITIATIVE
Not Applicable.
PREVIOUS ACTION
Not Applicable.
DATE OF NOTICE
Not Applicable.
ENVIRONMENTAL DETERMINATION
Not Applicable.
ATTACHMENT(S)
1. City Council Meeting Rules and Procedures Policy (110-1)
2. Public Statement Options
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 1 of 10
CITY OF BRENTWOOD
MEETING
RULES AND PROCEDURES
TABLE OF CONTENTS
Page
1. PURPOSE; APPLICABILITY ........................................................................................... 2
2. MEETINGS: GENERAL RULES ...................................................................................... 2
3. ELECTION OF CITY COUNCIL OFFICERS; DUTIES ..................................................... 4
4. MEETING AGENDA: PREPARATION AND CONTENTS.................................................. 6
5. DECORUM ....................................................................................................................... 7
6. VOTING AND DECISION; RECONSIDERATION ............................................................. 8
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 2 of 10
1. PURPOSE; APPLICABILITY
1.1 Purpose. The purpose of the Council Meeting Rules and Procedures (these “Rules”) is to establish protocols that will be convenient for the public and contribute to the orderly conduct of City business. These Rules apply in addition to:
• the Ralph M. Brown Act Open Meeting Law (Brown Act, Gov’t. Code §55950 and following);
• the Political Reform Act (Gov’t. Code §81000 and following); and • any other California laws that govern the conduct of City Council meetings.
1.2 Applicability. These Rules apply to meetings of the City Council and all City Commissions (unless: a provision is clearly not applicable, stated otherwise in the ordinance establishing a particular commission, or stated otherwise in state law). Reference to Mayor, Council, Council Member, and City Clerk shall respectively mean Chairperson, Commission, Commissioner and Secretary, when applicable to a City commission.
1.3 Effect. Failure to observe these Rules does not invalidate any otherwise lawful action.
2. MEETINGS: GENERAL RULES
2.1 Meeting – Definition. The term meeting means the gathering together of three or more members of the City Council (or a majority of the total members of any commission) to hear, discuss, deliberate, or take action on any matter within its jurisdiction. (Gov’t. Code §54952.2(a).)
1 2.2 Meetings Open to the Public. Unless otherwise authorized by law to be held in closed session, all City Council meetings are open and public. (Cal. Const. art I, §3(b)(1); Gov’t.
Code §54953(a).)
2.3 Time and Place of City Council Meetings. The City Council shall hold regular meetings at the dates, time, and location set forth in Municipal Code Chapter 2.04 and any related resolutions, or as modified by the Council.
2.4 Quorum. A majority of the total members of the Council shall constitute a quorum and is sufficient to transact regular business. A Council Member present but abstaining is counted for purposes of constituting a quorum. A Council Member disqualified from voting by law is not counted for purposes of constituting a quorum. (See Section 3.4a below.) If there is no quorum, the Mayor or City Clerk shall adjourn the meeting to a stated time and place.
2.5 Presiding Officer. The Mayor is the presiding officer of the Council. In the absence of the Mayor or in case of conflict under Section 3.4a, the Vice-Mayor shall preside. In the absence of the Mayor and Vice-Mayor, the City Manager shall preside over the election of a temporary chair.
The temporary chair will preside until the return of one of the officers. 1 The Brown Act prohibits a majority of a city council, outside an open and noticed meeting, from using a series of communications of any kind (including telephone or email, or through intermediaries) to discuss, deliberate or take any action on city business. (Gov’t. Code §54952.2(b)(2).
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 3 of 10
2.6 Types of meetings.
a. Regular meetings. This is the regular City Council meeting generally held twice per month, as established by the Municipal Code (Chapter 2.04) and City Council Resolution. b. Special Meetings. A special meeting may be called by the Mayor or by a majority of the City Council. Notice must be given in conformance with Government Code §54956 at least 24 hours before the special meeting.
c. Closed Sessions. The City Council may meet in closed session (not open to the public), as provided by California law. No member of the City Council, City employee or person present during a Closed Session may disclose to anyone not present at the Closed Session the content or substance of any confidential written materials or confidential discussions which took place during the session, unless the City Council votes to authorize disclosure of such information by a majority vote, except as otherwise required by law. (Gov’t. Code § 54956.5.) d. Adjourned Meetings. The City Council may adjourn a regular or special meeting to a specific time and place. (If there is less than a quorum at any scheduled meeting or if all members are absent, the Mayor or City Clerk may declare the meeting adjourned to a stated time and place and post notice of that fact consistent with Government Code § 54955. e. Continued Hearings. The City Council may continue any hearing to a subsequent meeting, stating the specific date, time, and place. (Government Code § 54955.1). f. Emergency Meetings. The City Council may hold an emergency meeting under Government Code section 54956.5 if a majority of the members of the City Council determine that there is 1) a work stoppage or other activity which severely impairs public health, safety, or both, or 2) a crippling disaster which severely impairs public health, safety, or both. Notice shall be given as provided in Government Code section 54956.5. g. Teleconferences. The City Council may use teleconferencing for any City Council meeting. Each teleconference location must be open to the public, and an agenda posted at each location. Each teleconference location shall be identified in the notice and agenda of the meeting. At least a quorum of the Council Members must be present at locations within the City.
All votes taken during a teleconferenced meeting shall be by roll call vote. (Gov’t. Code § 54953.)
h. Meetings with City Commissions. The City Council may hold a joint meeting with a City Commission, or with another public agency, in conformance with the Brown Act.
2.7 Minutes; Record-keeping. The City Clerk or his or her designee will take action minutes, consisting of the names of individuals speaking about an item, and the action taken by Council on each item including the motion and the vote. City Council and Planning Commission meetings are generally broadcast live and are also available for viewing later on the City‘s website. The City maintains audio recordings for other commission meetings. Copies or transcripts are available upon request, with prior payment of fees established by City Council resolution.
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 4 of 10
3 ELECTION OF CITY COUNCIL OFFICERS; DUTIES
3.1 Election of Vice Mayor. The City Council shall elect a Vice Mayor for a two-year term, at the meeting when new Council Members are sworn in after a general municipal election. If the office of Vice Mayor becomes vacant for any reason (including resignation, incapacity, death, recall, municipal election, or removal by majority vote), the City Council shall elect one of its members to fill the vacancy at the next regular meeting. The election or removal of the ViceMayor requires three affirmative votes.
3.2 Duties of Mayor. The Mayor has the power, authority, and discretion, without a vote of the majority of the Council (except as noted) to:
a. Preside over Council meetings:
1) maintain order and proper decorum (See Rule 5 below); 2) announce the business before the Council in the order set forth in the agenda (or as such order may be changed per Rule 4.3 below);
3) call for votes on each matter requiring a decision, and announce the results. The Mayor may make a motion, second and debate matters, subject only to the same limitations of debate as are imposed upon all members.);
4) when requested, make these Rules known and decide questions of order, subject to an appeal of the Council;
5) set time limits on Council discussion (subject to Council concurrence) and on communications from members of the public, consistent with the Brown Act; and 6) open public hearings.”
b. Agendas. Work with the City Manager in the preparation of agendas, and place items on a future Council meeting agenda, under Rule Sections 4.2 and 4.4 below. c. Signing. Sign all documents as authorized by the City Council, and ceremonial documents.
d. Subcommittees. Create subcommittees, with a concurrence of the Council, under Section
3.4b.
e. Appointments. Make appointments to a public office or position, with the confirmation of a majority of the City Council.
f. City Spokesperson. Serve as the chief spokesperson and representative for the City and City Council for matters concerning public policy.
g. Other duties. Perform other duties as are required by law or as pertain to the office of Mayor.
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 5 of 10
3.3 Duties of Vice Mayor. The Vice Mayor has the power and authority to:
a. Exercise the duties and powers of the Mayor, in the Mayor’s absence. b. Serve with the Mayor as spokesperson and representative for the Council. c. Assist the Mayor in anticipating an issue that may warrant a special meeting.
3.4 Duties of all Council Members. It is the duty of each Council Member to attend Council meetings, adhere to these Rules, and to cast votes as outlined below. a. Abstention from voting. A Council Member must abstain from voting if:
1) the Council Member has a personal or financial interest in the matter as defined in the California Political Reform Act (Government Code §§ 81000 et seq.) 2 ; or
2) the law otherwise declares the Council Member's participation to be a conflict of interest (e.g., Government Code §§ 1090, 1126, 81000 et seq.; or case law); or 3) the member is disqualified as to a particular matter because of his or her absence from a prior public hearing and inability or failure to review the prior testimony and evidence presented.
If a Council Member is disqualified, he or she shall declare this fact and the reason for it on the record, and shall leave the room until the matter is concluded. However, if the matter on which the Council Member is disqualified is on the Consent Calendar, and is not pulled from the Consent Calendar, the Council member does not need to step down from the dais during the vote. Rather, before the Consent Calendar vote, he or she should declare this fact and the reason for it on the record and state that he or she is not voting on that item. b. Committees and Boards. The business of the City Council will from time to time require work in Council committees (either a standing committee or ad hoc committee), and through Council Member participation on boards of other governmental agencies.
The Mayor, a majority of the Council, or staff may recommend formation of a committee. A committee assists in the resolution or study of issues arising from a specific area of Council concern. All communications and advice from a committee shall be made to the Council. A committee serves until discharged by a majority of the Council.
It is the duty of any Council Member sitting on such a committee, or outside board, to make periodic reports to the City Council as a whole and to the general public at regular City Council meetings. It is also the duty of a Council Member to timely advise his or her alternate, if any, if the Council Member will be absent from any committee or board meeting.
3.5 Absences. A Council Member should endeavor to give notice to the Mayor, City Manager, or City Clerk in advance if he or she will be absent or late to a Council meeting. If a Council Member is absent without permission from all regular city council meetings for 60 days consecutively from the last regular meeting he or she attended, his or her office becomes vacant and shall be filled as any other vacancy. (Gov’t. Code §36513.)
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 6 of 10
4 MEETING AGENDA: PREPARATION AND CONTENTS
4.1 General. The City Council will not discuss any item of business not appearing on the written agenda, except as provided in Government Code section 54954.2.
If other matters (not on the agenda) are raised by the public, the City Council or staff may refer the matter to staff or to a subsequent meeting.3 (Gov’t. Code §54954.2.)
4.2 Agenda Preparation; Distribution. There shall be a written agenda for each City Council meeting. The agenda shall contain a brief general description of each item of business to be transacted or discussed and shall include other matters as set forth in this Section 4. The City Clerk shall prepare the agenda in conjunction with the City Manager’s office. Anonymous communications will not be considered nor placed on the agenda. Only the City Manager, City Attorney, the Mayor and Council Members may add items to a Council agenda. If a member of the public wishes an item to be added, he or she must have a Council Member sponsor the item. The agenda will be posted and distributed as required by the Brown Act. (Gov’t. Code §§54954.2, 54954.1.)
4.3. Agenda Contents; Order of Business. The agenda shall include general information, a brief description of items of business, and the order of business (See Government Code § 54954.2).
The order of business is as follows, subject to change by the Mayor, Vice-Mayor (in the Mayor’s absence), City Manager or a majority vote of the City Council:
Call to Order and Roll Call
Pledge of Allegiance
Presentations (and Proclamations) (these may also be included on the Consent Calendar.) Public Comments (for items not on the public hearings or business items portions of the agenda, or requests for future agenda items)
Informational Reports from Council Members, committees, liaisons, and staff Consent Calendar
Public Hearings4
Business Items
Request for Future Agenda Items (by Council Members)
Adjournment
2 A Council Member may not make, participate in making, or in any way attempt to use their official position to influence a governmental decision in which they know (or have reason to know) they have a financial interest. (Gov’t. Code § 81000.) 3 No action or discussion shall be undertaken on any item not appearing on the posted agenda, except that members of a legislative body or its staff may briefly respond to statements made or questions posed by persons exercising their public testimony rights, ask a question for clarification, or provide a reference to staff or other resource for factual information. (Gov’t. Code §54954.2) 4 Public Hearings. Public hearings are those having specific notice requirements by state law or City ordinance. At the hearing, the Council shall afford any interested person (and his or her representative) the opportunity to speak, present witnesses and evidence, subject to these Rules. Public hearings will be conducted in the following order: (1) Staff Reports and Council Member questions to staff; (2) Public hearing opened by Mayor; (3) Public testimony; (4) Mayor closes the public hearing, by majority vote; (5) Discussion among Council Members; and (6) Action by majority vote
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 7 of 10
4.4 Adding Future Agenda Items.
An item may be added to a future agenda, and staff time authorized, in either of the following ways:
a. Standard agenda process for agenda preparation, under Rule Section 4.2 above, including:
1) by the City Manager, City Attorney, or staff; or
2) by written request to the City Manager by the Mayor or two Council Members at least one week before the publication of the next agenda (Thursday by 5:00 p.m.) and the City Manager determines that there is adequate staff time to prepare discussion and recommendation materials; or
b. By an individual Council Member making:
1) a written request to the City Manager at least one week before the publication of the next agenda to place the item under Request for Future Agenda Items on the next agenda; or
2) a verbal request at a Council meeting to have an item placed on the next agenda under Request for Future Agenda Items.
In either case (b.1 or b.2), the listed item will identify the Council Member making the request and briefly describe the nature of the request. Council discussion will be limited to whether staff time and City resources should be spent on the item and the time period for scheduling. Staff will not spend time on the requested item unless and until the Council wishes additional information, except that if staff has already worked on a matter or the City Manager deems an item to be urgent, he or she may place it on the next agenda as an action item.
5 DECORUM
5.1 Decorum Generally - City Council Members. The Mayor and Council Members shall preserve order and decorum at City Council meetings. Council Members shall confine their remarks to the agenda item under consideration and speak only when recognized by the Mayor, except as otherwise provided in these Rules. Once a Council Member is recognized, he or she will not be interrupted unless called to order by the Mayor. A Council Member may not, by conversation or otherwise, disturb or disrupt the proceedings or the peace of the City Council in any way, nor disturb any other Council Member or member of the public while speaking, nor refuse to obey the instruction of the Mayor or City Council.
During a quasi-judicial hearing5
, an applicant or appellant is entitled to due process of law, including a meaningful opportunity to be heard. Council Members should not receive information outside of the hearing on the matter unless they disclose the nature of the communications. Council Members will give full attention to speakers at the hearing. 5 A quasi-judicial hearing is one that involves the application of rules to a specific project or set of existing circumstances.
Examples include land use matters (but not legislative decisions such as General Plan or zoning amendments, or development agreements), employee disciplinary proceedings, and proceedings for the revocation, suspension, or reinstatement of permits, licenses, and franchises.
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 8 of 10
Council meetings will be governed by common sense and good taste. In case of a dispute concerning a procedural matter not specifically covered in these Rules, the majority vote of the Council will control.
5.2 Decorum Generally - Public.
Members of the public wishing to speak during the public discussion are requested to fill out the speaker form provided and hand the card to the City Clerk at the beginning of (or during) the meeting. Comments by members of the public are generally limited to five minutes, or less time if a large number of speakers is anticipated, or if approved by the Mayor. A speaker may not allocate his or her time to another speaker. The Mayor will invite public testimony on each item at the appropriate time. Written documents or messages to the City Council or any Council Member while the City Council is in session, which pertain to the Council’s business, shall be made only through the City Clerk.
A member of the audience must come forward to the lectern so that their remarks may be accurately recorded. All remarks shall be addressed to the Mayor, except that answers to questions posed by a City Council Member recognized by the Mayor may be addressed to the questioner. No person other than a member of the City Council and the person having the floor shall enter into any discussion, either directly or through a Council Member, without the permission of the Mayor. The comments must be pertinent to the agenda item under discussion. A member of the public may not ask a question of a Council Member or staff member, except through the Mayor. Speakers are urged to avoid unnecessary repetition in their remarks and instead simply indicate agreement with previous speakers.
If a meeting is willfully interrupted by any individual, group or groups of people so as to render the orderly conduct of the meeting unfeasible, the Mayor may recess the meeting and require the removal of individuals who are interrupting the meeting, or clear the room and continue the meeting allowing only members of the press to remain. (Gov’t. Code §§ 54957.9.)”
6 VOTING AND DECISION; RECONSIDERATION
6.1 Voting and Decision. Ordinances, resolutions and other matters submitted to the Council must be adopted by a majority vote of the total membership of the Council unless a greater number of votes is required by law. A majority means three votes for the City Council (and for each City commission with a total of five members). If one or more Council Members is absent and a majority vote cannot be obtained, and no additional action is taken, the matter shall automatically be added to a future agenda, to be considered at least once with all Council Members present.
If a member (qualified to vote) does not vote in the affirmative or negative, the member shall be deemed to have voted in the affirmative.
A tie vote means the motion is not approved.
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 9 of 10
After a vote is taken on a matter, if an appropriate resolution is not already prepared, the Council may direct the staff to prepare a resolution reflecting the City Council’s findings and decision. A resolution brought back to the Council may be placed on the Consent Calendar. (No public comments can be received or considered unless a public hearing is re-noticed.) The vote is not considered final until the City Council reviews and approves the resolution at a later meeting.
6.2 Reconsideration. This section 6.2 does not apply to City Commissions. a. Reconsideration of Quasi-Judicial Actions. (See footnote 5.) A motion to reconsider any quasi-judicial action taken by the City Council may be made by any Council Member who voted with the majority on a question, and may be seconded by any Council Member. The motion must be approved by a majority vote of the entire City Council. The City Clerk shall provide notice to all interested parties as soon as possible when a matter becomes the subject of a motion to reconsider.
1) Timing. The motion must be made at the same meeting at which the action was taken (including an adjourned or continued meeting), at the next regular meeting, or at any intervening special meeting. If a request for reconsideration is communicated to the City Manager by any Council Member who voted in the majority, at least 24 hours before the state law deadline for posting the City Council meeting agenda, then the request shall appear on the posted agenda for the next regular meeting or intervening special meeting. Otherwise, no City Council discussion or action on reconsideration may occur unless the item is appropriately added to the agenda under Government Code section 54954.2(b) which addresses adding items that are not listed on a posted agenda, when immediate action is necessary. (See Rule Section 4.1b.) 2) Effect of Approval of Motion; Notice. If the motion to reconsider is made and approved at the same meeting at which the initial action was taken and all interested persons (including applicants, owners, supporters, and opponents) are still present, the matter may be reconsidered at that meeting or at the next regular meeting or intervening special meeting (subject to the discretion of the maker of the motion) and no further public notice is required.
If the motion to reconsider is made and approved at the same meeting at which the initial action was taken but all interested persons are not still present, or if the motion is made and approved at the next regular meeting or intervening special meeting, the item shall be scheduled for consideration at the earliest feasible City Council meeting and shall be re-noticed in accordance with state law and the Municipal Code. In certain circumstances, a right may have vested after the initial decision, precluding reconsideration.
b. Reconsideration of Legislative or Other Non-Quasi-Judicial Actions. The City Council may rescind, repeal or amend its prior legislative or other non-quasi-judicial actions (unless precluded from doing so under applicable laws) at any regular or special meeting of the City Council. Noticing and scheduling of such actions shall be consistent with Rule Section 4 (Meeting Agenda: Preparation and Contents) and any required notice provisions.
COUNCIL/ADMINISTRATIVE POLICY
CITY OF BRENTWOOD
Subject:
Meeting Rules and Procedures
Policy No: 110-1 Date: 10/10/2023
Resolution No: 2023-123 Page 10 of 10
Revision History
Date Resolution
11/13/2001 2399 adopted policy
04/27/2004 2004-97 amended Rules 1-27 added rules 28-36 05/25/2005 2005-260 deleted Rule 8
04/11/2006 2006-73 deleted Rule 36
01/23/2007 2007-15 added Rule 13A
10/09/2007 2007-225 amended Rule 13A
05/24/2011 2011-67 deleted a portion of Rule 32 & amended Rule 28H 01/22/2013 2013-11 amended Rule 26 Priority of Business 12/10/2013 2013-174 amended Rule 35 in its entirety
12/09/2014 2014-182 amended Rule 13 A
6/14/2016 2016-74 Re-adopting new Meeting Rules and Procedures 12/12/2017 2017-162 Quorums and reconsideration of matters by City commissions 10/10/2023 2023-123 – Amended Rule 3.2 and 5.2
Attachment 2
Hate Speech Statements
Option 1 – Under the Brown Act, public comment for matters on the agenda must relate to that agenda item and public comments for matters not on the agenda must relate to the subject matter jurisdiction of this legislative body. This is a warning that if a member of the public attending this meeting remotely or in-person fails to comply with these requirements of the Brown Act, then the Mayor or Chair may request that speaker be muted. If a member of the public attending this meeting in-person engages in disruptive behavior that disturbs the orderly conduct of the meeting, they may be removed from the meeting after a warning, pursuant to Council Policy 110-
1. Option 2 – Read at the beginning of the meeting
The City strongly denounces hate speech and does not tolerate disruptive behavior in our meetings. Brentwood prides itself on the rich diversity of our residents. We are committed to creating a culture of belonging where members of our diverse community feel included, safe, and respected.
This Council meeting is considered a “limited public forum,” which means the Council can regulate the time, place, and manner of speech to prevent our meetings from being disrupted. This protects the rights of other speakers, and ensures the Council can accomplish its business in a reasonably efficient manner.
Speaker comments must be limited to the agenda item being considered by the Council or, for matters not on the agenda, comments must relate to the subject matter jurisdiction of this legislative body.
The Mayor or Chair will make a determination as to whether a speaker’s comment is related to an agenda item being considered by this body.
If a speaker does not comply, the Mayor or Chair will rule the speaker out of order.
The Mayor or Chair will not rule speech out of order because the Mayor or Chair disagrees with the content of the speaker’s speech.
Specific statement when Speaker is out of order:
This speaker is out of order, as the speaker is not commenting on the agenda item being considered by the Council.
Statement if Speaker uses derogatory language or hate speech:
The City strongly denounces hate speech and does not tolerate disruptive behavior in our meetings. Brentwood prides itself on the rich diversity of our residents. We are committed to creating a culture of belonging where members of our diverse community feel included, safe, and respected. If members of the public or staff would
like to leave the Council chambers, they may do so at this time, so as not to be subject to hate speech.
Specific statement to call for a recess to provide a break or consult with staff:
At this time, the meeting will recess until X:XX a.m./p.m. or for XX minutes.
Option 3 -- Brentwood City Council meetings are limited public forums during which the City strives to provide an open, safe atmosphere and promote robust public debate. Members of the public, however, must comply with state law, as well as the City’s laws and procedures and may not actually disrupt the orderly conduct of these meetings. The public, for example, may not shout or use amplifying devices, must speak during their allotted time, may not create a physical disturbance, may not speak on matters unrelated to issues within the jurisdiction of the City Council or the agenda item at hand, and may not cause immediate threats to public safety.
CITY COUNCIL AGENDA ITEM NO. J.1
09/10/2024
SUBJECT: A Request from Council Member Mendoza for the preparation of a memo on the status of improvements to a wall located in Summerset.
DEPARTMENT: City Manager’s Office
STAFF: Tim Ogden, City Manager
Amanda McVey, Assistant City Clerk
TITLE/RECOMMENDATION
That the City Council consider and discuss the request from Council Member Mendoza requesting staff prepare a memo on the status of improvements to a wall located in Summerset at Balfour Road and Fairview Avenue.
FISCAL IMPACT
There is no fiscal impact associated with the preparation of the memo.
BACKGROUND
Pursuant to Rule 4.4 (b)(2) of City Council Policy 110-1, this item has been placed on the agenda so that the City Council may discuss it and provide further direction to staff. Per Section 4.4, City Council discussion is limited to whether staff time and City resources should be spent on the item and the time period for scheduling.
CITY COUNCIL STRATEGIC INITIATIVE
Not Applicable.
PREVIOUS ACTION
Previous Action by the City Council is included on Attachment 1.
DATE OF NOTICE
Not Applicable.
CITY COUNCIL AGENDA ITEM NO. J.1
09/10/2024
ENVIRONMENTAL DETERMINATION
Not Applicable.
ATTACHMENT(S)
1. Previous Action
ATTACHMENT “1”
Previous actions related to this agenda item that were taken by the Council are listed below. To view prior actions and materials, and Brentwood Municipal Code references in the staff report, as applicable:
Visit www.brentwoodca.gov/meetings, and select the meeting date(s) desired to see the reference materials and videos.
Visit www.brentwoodca.gov/municipalcode to research references to the Brentwood Municipal Code and search by the code section(s) cited.
On August 13, 2024, Council Member Mendoza requested a future agenda item to request staff prepare a memorandum on the status of the Summerset wall located at Balfour Road and Fairview Drive.
CITY COUNCIL AGENDA ITEM NO. J.2
09/10/2024
SUBJECT: A request from Council Member Mendoza requesting staff hold a townhall related to permitting and business license processes DEPARTMENT: City Manager’s Office
STAFF: Tim Ogden, City Manager
Amanda McVey, Assistant City Clerk
TITLE/RECOMMENDATION
That the City Council consider and discuss the request from Council Member Mendoza requesting staff hold a town hall inviting business to provide feedback on potential improvements to the permitting and business license process.
FISCAL IMPACT
There is no fiscal impact associated this agenda item.
BACKGROUND
Pursuant to Rule 4.4 (b)(2) of City Council Policy 110-1, this item has been placed on the agenda so that the City Council may discuss it and provide further direction to staff. Per Section 4.4, City Council discussion is limited to whether staff time and City resources should be spent on the item and the time period for scheduling.
CITY COUNCIL STRATEGIC INITIATIVE
Not Applicable.
PREVIOUS ACTION
Previous Action by the City Council is included on Attachment 1.
DATE OF NOTICE
Not Applicable.
ENVIRONMENTAL DETERMINATION
CITY COUNCIL AGENDA ITEM NO. J.2
09/10/2024
Not Applicable.
ATTACHMENT(S)
1. Previous Action
ATTACHMENT “1”
Previous actions related to this agenda item that were taken by the Council are listed below. To view prior actions and materials, and Brentwood Municipal Code references in the staff report, as applicable:
Visit www.brentwoodca.gov/meetings, and select the meeting date(s) desired to see the reference materials and videos.
Visit www.brentwoodca.gov/municipalcode to research references to the Brentwood Municipal Code and search by the code section(s) cited.
On August 13, 2024, Council Member Mendoza requested a future agenda item to requesting staff hold a town hall inviting business to provide feedback on potential improvements to the permitting and business license process.
CITY COUNCIL AGENDA ITEM NO. J.3
09/10/2024
SUBJECT: A request from Council Member Pierson requesting staff prepare information related to the trail between American Avenue and Mountain View Drive
DEPARTMENT: City Manager’s Office
STAFF: Tim Ogden, City Manager
Amanda McVey, Assistant City Clerk
TITLE/RECOMMENDATION
That the City Council consider and discuss the request from Council Member Pierson related to the trail between American Avenue and Mountain View Drive and the status of grant funds that may have been used to improve the trail.
FISCAL IMPACT
There is no fiscal impact associated this agenda item.
BACKGROUND
Pursuant to Rule 4.4 (b)(2) of City Council Policy 110-1, this item has been placed on the agenda so that the City Council may discuss it and provide further direction to staff. Per Section 4.4, City Council discussion is limited to whether staff time and City resources should be spent on the item and the time period for scheduling.
CITY COUNCIL STRATEGIC INITIATIVE
Not Applicable.
PREVIOUS ACTION
Previous Action by the City Council is included on Attachment 1.
DATE OF NOTICE
Not Applicable.
CITY COUNCIL AGENDA ITEM NO. J.3
09/10/2024
ENVIRONMENTAL DETERMINATION
Not Applicable.
ATTACHMENT(S)
1. Previous Action
ATTACHMENT “1”
Previous actions related to this agenda item that were taken by the Council are listed below. To view prior actions and materials, and Brentwood Municipal Code references in the staff report, as applicable:
Visit www.brentwoodca.gov/meetings, and select the meeting date(s) desired to see the reference materials and videos.
Visit www.brentwoodca.gov/municipalcode to research references to the Brentwood Municipal Code and search by the code section(s) cited.
On August 13, 2024, Council Member Pierson requested a future agenda item to discuss the trail between American Avenue and Mountain View Drive and the status of grant funds that were used to improve the trail.