STAFF REPORT TO THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY TO THE HERCULES REDEVELOPMENT AGENCY DATE: Regular Meeting of March 22, 2022
TO: Board of Directors of the Successor Agency to the Hercules Redevelopment Agency
VIA: Dante Hall, City Manager
SUBMITTED BY: Edwin Gato, Director of Finance
SUBJECT: Approval of Preliminary Official Statement for the Successor Agency to the Hercules Redevelopment Agency 2022 Tax Allocation Refunding Bonds and Disclosure Procedures, and Related Actions RECOMMENDED ACTION:
Adopt a Resolution of the Successor Agency to the Hercules Redevelopment Agency approving the form of a Preliminary Official Statement to deem final under Rule 15c2-12, approving Disclosure Procedures, and authorizing certain other actions in connection therewith.
FISCAL IMPACT OF RECOMMENDATION:
The Resolution approves the form of the Preliminary Official Statement for the 2022 Tax Allocation Refunding Bonds (the “2022 Bonds”) and approves the Disclosure Procedures as applicable to the Successor Agency. Tonight’s recommended action to approve the Preliminary Official Statement and Disclosure Procedures does not have a fiscal impact.
DISCUSSION:
Background
On October 26, 2021, the Board of Directors of the Successor Agency directed staff to proceed with the actions necessary to issue the 2022 Bonds to refinance the Successor Agency’s Prior Obligations to achieve debt service savings.
On January 11, 2022, the Successor Agency to Hercules Redevelopment Agency (the “Agency”) authorized the issuance and sale of 2022 Tax Allocation Refunding Bonds (the “2022 Bonds”) by Resolution No. 22-003-SA.
On January 24, 2022, the Contra Costa Countywide Oversight Board (“CWOB”) approved the issuance of the 2022 Bonds. With the authorization to move forward, the California Department of Finance (“DOF”) 60-day review process was initiated on February 1, 2022. Staff and the Agency’s financing team are ready to present the Preliminary Official Statement to the Successor Agency for consideration and approval prior to pricing the refunding bonds.
On March 8, 2022, the Agency and City Council received a presentation by Stradling Yocca Carlson & Rauth, Bond and Disclosure Counsel, regarding federal securities law matters related to the offering of municipal bonds.
The proposed Resolution of the Successor Agency approves the form of a Preliminary Official Statement in connection with the 2022 Bonds, authorizes certain other actions with respect thereto, and adopts such Disclosure Procedures as applicable to the Successor Agency.
Preliminary Official Statement Stradling Yocca Carlson & Rauth, the Successor Agency’s Bond Counsel and Disclosure Counsel, has prepared the form of a Preliminary Official Statement (the “POS”) to be used in marketing the 2022 Bonds. The POS was prepared based on information provided by and in coordination with Urban Futures, Incorporated (Municipal Advisor), RSG, Inc. (Fiscal Consultant), Stifel, Nicolaus & Company, Incorporated (Underwriter), and Successor Agency staff.
The POS is the “offering document” for the Bonds. The Successor Agency Board has an obligation to ensure that the POS includes all information that would be material to a prospective investor’s decision whether to purchase the Bonds. While the Successor Agency’s legal counsel, consultants, and the Underwriter have participated in preparing the POS, the Successor Agency Board and staff are ultimately responsible for ensuring that the POS is accurate, contains no misleading information and does not omit any information necessary to make the POS not misleading to investors.
Disclosure Procedures The purpose of the Disclosure Procedures (the “Procedures”) is to memorialize and communicate key principles and procedures in connection with obligations, including notes, bonds and certificates of participation, issued by the City of Hercules (the “City”), the Hercules Public Financing Authority (the “Authority”), and the Successor Agency or any community facilities district (each, a “District” and together, the “Districts”) subsequently authorized or approved by the City.
ATTACHMENTS:
Resolution No. 22-___ of the Successor Agency to the Hercules Redevelopment Agency Preliminary Official Statement
Disclosure Procedures
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