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CITY of BRISBANE
Monday, April 3rd, 2023 at 2:00PM ● Hybrid Meeting
Brisbane City Hall 50 Park Place, Brisbane, CA
The public may observe/participate in the Subcommittee meetings by using remote public comment options or attending in person. Subcommittee members shall attend in person unless remote participation is permitted by law. The Subcommittee may take action on any item listed in the agenda.
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To address the Subcommittee on any item on or not on the posted agenda, please wait until Public Comments are being accepted.
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Fiscal and Administrative Policies
Subcommittee Agenda
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SUBCOMMITTEE MEMBERS:
Mayor Pro-tem O’Connell, Councilmember Cunningham
ROLL CALL
A. Consider any request of a City Councilmember to attend the meeting remotely under the “Emergency Circumstances” of AB 2449
PRESENTATIONS AND DISCUSSION ITEMS
B. Consider Funding Options for City Hall Annex located at 25 Park Place, Brisbane
PUBLIC COMMENT
ADJOURNMENT
2 File Attachments for Item:
B. Consider Funding Options for City Hall Annex located at 25 Park Place, Brisbane 3 B.
Review Financing for City Hall Annex Improvements Page 1 of 2
CITY COUNCIL FISCAL AND ADMINISTRATIVE POLICIES
SUBCOMMITTEE AGENDA REPORT
Meeting Date: 4/3/2023
From: Carolina Yuen, Finance Director
Subject: Review Financing for City Hall Annex Improvements Community Goal/Result
Fiscally Prudent
Community Building
Purpose
Discuss whether the City should enter into a financing arrangement to cover costs to improve the City Hall Annex.
Recommendation
To proceed with steps necessary to secure financing to cover the costs associated with improvements needed to inhabit the City Hall Annex at 25 Park Place.
Background
In July 2021, the City entered into a 10 year lease for the property located at 25 Park Place in order to serve better the community and in anticipation of the need for additional space for staff due to the potential development of the Baylands. In February 2023, the City amended the lease to extend the term an additional 15 years in order to obtain financing to cover the necessary tenant improvements.
Estimates of construction costs to improve the property range are currently been presented at $4.6 million including a 20% cushion to cover unexpected change orders and the cost of construction management. The architect’s contract was for approximately $400,000.
Discussion
City staff and the City’s Financial Advisor have started to explore financing options considering municipal bond rates are declining over the past month after sharp increases in 2022. The target is to keep the annual payment structure comparable to existing requirements considering we have a Pension Obligation Bond due in 2023 and the City Hall Remodel Refunding due to be paid off in 2029. Proposed payments are structured to commence in FY2024.
4 B.
Review Financing for City Hall Annex Improvements Page 2 of 2 The amount currently being sought is $5.5 million to cover the estimated design and construction costs to improve the property, plus additional $500,000 to cover moving, furnishing, and any unexpected costs.
The initial proposal will require the City to pay a range of $187,500 to $245,000 per year in interest in the first five years, and a total of $2,910,000 over the 20 year term.
City properties, primarily Mission Blue, are being reviewed to serve as collateral. It is possible that we will need to bundle properties to satisfy the financing requirements.
If the City Council chooses not to borrow the $5.5 million, the City would need to instead pay cash from the General Fund and reduce the amount of cash available to meet other needs. As discussed when the FY23 budget was adopted, the City is using reserves to cover costs for FY22 and FY23 with a plan to pay back over time to comply with our Fund Balance Policy. Spending cash instead of borrowing may risk us not having funds accessible if there is an emergency or to cover lost revenues. Reducing the City’s cash balance would also reduce the amount of interest the City could earn from existing investments.
Fiscal Impact
With current bond rates, the additional annual debt service payment is expected to range from $287,500 to $435,000 over the next 20 years.
Measure of Success
The City and staff are able to enjoy the use of the City Hall Annex property to benefit the community.
Attachments
1. Preliminary Financing Schedules
___________________________________ ___________________________________ Carolina Yuen, Finance Director Clay Holstine, City Manager 5 B.
Preliminary, Subject to Change
Brisbane/GVMID Financing Authority
Lease Revenue Bonds, Series 2023
Sources & Uses of Funds
Issue Summary
Dated Date 06/01/2023
Par Amount $5,500,000
Underwriter's Spread 1.250%
Total Costs as % of Par 3.968%
True Interest Cost 4.26236%
Bond Yield 3.78313%
Weighted Average Maturity 11.845 years
Sources of Funds: Uses of Funds:
Par Amount $5,500,000.00 Project Fund $5,575,647.50
Original Issue Premium 293,897.50 Net Underwriting 68,750.00 Housing Fund Cash 0.00 Insurance 0.00
Total $5,793,897.50 Issuance Costs 149,500.00
Total $5,793,897.50
JNA Consulting Group LLC Page 1 of 4
3/29/2023
BRIS LRB Series 2023
6 B.
Preliminary, Subject to Change
Brisbane/GVMID Financing Authority
Lease Revenue Bonds, Series 2023
Debt Service Schedule
Semi-Annual Annual
Date Principal Rate Interest Debt Service Debt Service
06/01/2023
09/01/2023 $62,500.00 $62,500.00
03/01/2024 100,000 5.000% 125,000.00 225,000.00 $287,500.00 09/01/2024 122,500.00 122,500.00
03/01/2025 100,000 5.000% 122,500.00 222,500.00 345,000.00 09/01/2025 120,000.00 120,000.00
03/01/2026 190,000 5.000% 120,000.00 310,000.00 430,000.00 09/01/2026 115,250.00 115,250.00
03/01/2027 200,000 5.000% 115,250.00 315,250.00 430,500.00 09/01/2027 110,250.00 110,250.00
03/01/2028 210,000 5.000% 110,250.00 320,250.00 430,500.00 09/01/2028 105,000.00 105,000.00
03/01/2029 220,000 5.000% 105,000.00 325,000.00 430,000.00 09/01/2029 99,500.00 99,500.00
03/01/2030 235,000 5.000% 99,500.00 334,500.00 434,000.00 09/01/2030 93,625.00 93,625.00
03/01/2031 245,000 5.000% 93,625.00 338,625.00 432,250.00 09/01/2031 87,500.00 87,500.00
03/01/2032 255,000 5.000% 87,500.00 342,500.00 430,000.00 09/01/2032 81,125.00 81,125.00
03/01/2033 270,000 5.000% 81,125.00 351,125.00 432,250.00 09/01/2033 74,375.00 74,375.00
03/01/2034 285,000 5.000% 74,375.00 359,375.00 433,750.00 09/01/2034 67,250.00 67,250.00
03/01/2035 300,000 5.000% 67,250.00 367,250.00 434,500.00 09/01/2035 59,750.00 59,750.00
03/01/2036 315,000 4.000% 59,750.00 374,750.00 434,500.00 09/01/2036 53,450.00 53,450.00
03/01/2037 325,000 4.000% 53,450.00 378,450.00 431,900.00 09/01/2037 46,950.00 46,950.00
03/01/2038 340,000 4.000% 46,950.00 386,950.00 433,900.00 09/01/2038 40,150.00 40,150.00
03/01/2039 350,000 4.000% 40,150.00 390,150.00 430,300.00 09/01/2039 33,150.00 33,150.00
03/01/2040 365,000 4.250% 33,150.00 398,150.00 431,300.00 09/01/2040 25,393.75 25,393.75
03/01/2041 380,000 4.250% 25,393.75 405,393.75 430,787.50 09/01/2041 17,318.75 17,318.75
03/01/2042 400,000 4.250% 17,318.75 417,318.75 434,637.50 09/01/2042 8,818.75 8,818.75
03/01/2043 415,000 4.250% 8,818.75 423,818.75 432,637.50 $5,500,000 $2,910,212.50 $8,410,212.50 $8,410,212.50
JNA Consulting Group LLC Page 2 of 4
3/29/2023
BRIS LRB Series 2023
7 B.
Preliminary, Subject to Change
Brisbane/GVMID Financing Authority
Lease Revenue Bonds, Series 2023
Pricing Schedule
Call Date: 03/01/2031
Call Price: 100
Date Principal Coupon Yield Price Prem/(Disc) Production 06/01/2023
03/01/2024 $100,000.00 5.000% 3.210% 101.311 $1,311.00 $101,311.00 03/01/2025 100,000.00 5.000% 3.100% 103.207 3,207.00 103,207.00 03/01/2026 190,000.00 5.000% 2.960% 105.345 10,155.50 200,155.50 03/01/2027 200,000.00 5.000% 2.870% 107.517 15,034.00 215,034.00 03/01/2028 210,000.00 5.000% 2.840% 109.530 20,013.00 230,013.00 03/01/2029 220,000.00 5.000% 2.830% 111.436 25,159.20 245,159.20 03/01/2030 235,000.00 5.000% 2.830% 113.244 31,123.40 266,123.40 03/01/2031 245,000.00 5.000% 2.870% 114.702 36,019.90 281,019.90 03/01/2032 255,000.00 5.000% 2.910% 114.403 * 36,727.65 291,727.65 03/01/2033 270,000.00 5.000% 2.940% 114.179 * 38,283.30 308,283.30 03/01/2034 285,000.00 5.000% 3.050% 113.364 * 38,087.40 323,087.40 03/01/2035 300,000.00 5.000% 3.190% 112.336 * 37,008.00 337,008.00 03/01/2036 315,000.00 4.000% 3.700% 102.000 * 6,300.00 321,300.00 03/01/2037 325,000.00 4.000% 3.880% 100.791 * 2,570.75 327,570.75 03/01/2038 340,000.00 4.000% 3.990% 100.061 * 207.40 340,207.40 03/01/2039 350,000.00 4.000% 4.050% 99.416 (2,044.00) 347,956.00 03/01/2040 365,000.00 4.250% 4.220% 100.191 * 697.15 365,697.15 03/01/2041 380,000.00 4.250% 4.250% 100.000 0.00 380,000.00 03/01/2042 400,000.00 4.250% 4.280% 99.610 (1,560.00) 398,440.00 03/01/2043 415,000.00 4.250% 4.330% 98.939 (4,403.15) 410,596.85 -------------- -------------- -------------- $5,500,000.00 Par Amount $293,897.50 $5,793,897.50 225,147.50 + Premium Bid
5,725,147.50 = Amount Bid
68,750.00 + Gross Underwriter's Spread
$5,793,897.50 = Price to Public
* Priced to first call date
JNA Consulting Group LLC Page 3 of 4
3/29/2023
BRIS LRB Series 2023
8 B.
Preliminary, Subject to Change
Brisbane/GVMID Financing Authority
Lease Revenue Bonds, Series 2023
Combined General Fund Debt Service
Fiscal Outstanding Outstanding Total Proposed 2023 Bonds Total Year 2017 Bonds 2022 Bonds Outstanding Principal Interest Total Debt Service 2023 152,901 132,619 285,520 285,520
2024 157,006 212,342 369,348 100,000 187,500 287,500 656,848 2025 153,956 214,618 368,574 100,000 245,000 345,000 713,574 2026 155,906 213,131 369,038 190,000 240,000 430,000 799,038 2027 156,746 211,629 368,375 200,000 230,500 430,500 798,875 2028 151,497 217,387 368,884 210,000 220,500 430,500 799,384 2029 152,293 216,218 368,511 220,000 210,000 430,000 798,511 2030 368,101 368,101 235,000 199,000 434,000 802,101
2031 368,107 368,107 245,000 187,250 432,250 800,357
2032 368,142 368,142 255,000 175,000 430,000 798,142
2033 368,338 368,338 270,000 162,250 432,250 800,588
2034 368,515 368,515 285,000 148,750 433,750 802,265
2035 368,415 368,415 300,000 134,500 434,500 802,915
2036 368,198 368,198 315,000 119,500 434,500 802,698
2037 368,307 368,307 325,000 106,900 431,900 800,207
2038 368,281 368,281 340,000 93,900 433,900 802,181
2039 367,931 367,931 350,000 80,300 430,300 798,231
2040 368,333 368,333 365,000 66,300 431,300 799,633
2041 368,206 368,206 380,000 50,788 430,788 798,993
2042 368,799 368,799 400,000 34,638 434,638 803,437
1,080,306 6,205,616 7,285,922 5,085,000 2,892,575 7,977,575 15,263,497 JNA Consulting Group LLC Page 4 of 4
3/29/2023
BRIS LRB Series 2023
9 B.
$5,500,000 (estimated)
Brisbane/Guadalupe Valley Municipal Improvement District Financing Authority (San Mateo County, California)
Lease Revenue Bonds
Series 2023
(25 Park Place Improvements)
March 29, 2023
Tentative Financing Schedule
Date Activity Participants
Tuesday, 03/28/23 Draft legal documents distributed BC
Monday, 04/03/23 Council Subcommittee Meeting
Location: City Hall Time: 2:00 p.m.
All
Monday, 04/10/23 Distribute draft Preliminary Official Statement DC Monday, 04/17/23 Document review meeting
Location: TBD Time: [2:00 p.m.]
All
Thursday, 04/20/23 Council/JPA Meeting to set regular meeting dates Location: City Hall Time: 7:30 p.m.
BRIS
Friday, 04/21/23 Distribute revised legal documents and POS BC Thursday, 04/27/23 Document review meeting
Location: TBD Time: [2:00 p.m.]
All
Tuesday, 05/02/23 Final legal documents and POS distributed BC Tuesday, 05/09/23 Put bond documents on file with City/Authority by 5:00 p.m. BC Wednesday, 05/10/23 Agenda deadline for May 18th Council Meeting Wednesday, 05/10/23 Rating Agency Presentation
Location: TBD Time: TBD
All
Thursday, 05/11/23 Publish Notice of Public Hearing BC
Tuesday, 05/16/23 Publish notice of intention BRIS, BC
Wednesday, 05/17/23 Receive rating MA
Thursday, 05/18/23 Public Hearing
City Council and Authority approve bond documents
Location: City Hall Time: 7:30 pm
All
Friday, 05/19/23 Post POS DC
Wednesday, 05/31/23 Bond Sale
Location: City Hall Time: 8:30 a.m.
BRIS, MA, BC
Thursday, 06/01/23 Distribute draft Official Statement DC Friday, 06/02/23 Distribute closing memo MA
Monday, 06/05/23 Comments due on Official Statement All Tuesday, 06/06/23 Post Official Statement DC
Wednesday, 06/14/23 Bond Pre-closing All
Thursday, 06/15/23 Bond Closing All
Participants Key
BRIS = City of Brisbane, Issuer
BC/DC = Quint & Thimmig, Bond/Disclosure Counsel
MA = JNA Consulting Group LLC, Municipal Advisor
10 B.