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SUPPLEMENTAL AGENDA
REGULAR MEETING AGENDA
OF THE JURUPA VALLEY CITY COUNCIL
Thursday, April 20, 2023
Regular Meeting: 7:00 p.m.
City Council Chamber
8930 Limonite Avenue, Jurupa Valley, CA 92509
1. 7:00 PM - CALL TO ORDER AND ROLL CALL FOR REGULAR MEETING ● Chris Barajas, Mayor
● Guillermo Silva, Mayor Pro Tem
● Leslie Altamirano, Council Member
● Brian Berkson, Council Member
● Armando Carmona, Council Member
C. AMENDED STAFF REPORT TO INCLUDE AN ADDITIONAL OWNER
PUBLIC HEARING TO CONSIDER A RESOLUTION AUTHORIZING
EXECUTION AND DELIVERY OF JOINT COMMUNITY FACILITIES
AGREEMENT FOR BOND OPPORTUNITIES FOR LAND
DEVELOPMENT (BOLD) PROGRAM FOR DEVELOPMENT IMPACT
FEES FOR TRACT NOS. 36947 AND 32721 (204 SINGLE FAMILY
RESIDENTIAL UNITS) LOCATED WEST OF 28TH STREET AND
A. As a courtesy to those in attendance, we ask that cell phones be turned off or set to their silent mode and that you keep talking to a minimum so that all persons can hear the comments of the public and City Council.
B. A member of the public who wishes to speak under Public Comments must fill out a “Speaker Card” and submit it to the City Clerk BEFORE the Mayor calls for Public Comments on an agenda item. Each agenda item up will be open for public comments before taking action. Public comments on subjects that are not on the agenda can be made during the “Public Appearance/Comments” portion of the agenda.
C. Members of the public who wish to comment on the CONSENT CALENDAR may do so during the Public Comment portion of the Agenda prior to the adoption of the Consent Calendar.
D. As a courtesy to others and to assure that each person wishing to be heard has an opportunity to speak, please limit your comments to 3 minutes.
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CANAL STREET; AND MAKING A FINDING OF SIGNIFICANT
BENEFITS FOR THE FINANCING OF CERTAIN IMPROVEMENTS BY
A COMMUNITY FACILITIES DISTRICT TO BE FORMED BY THE
CALIFORNIA MUNICIPAL FINANCE AUTHORITY
1. Requested Action: That the City Council conduct a public hearing regarding the financing of public improvements to be owned by the City of Jurupa Valley or the Jurupa Area Recreation and Park District in connection with the Emerald Ridge/Hacienda development through the formation of a Community Facilities District and the issuance of bonds by the California Municipal Finance Authority (the “CMFA”); and
2. That the City Council adopt Resolution No. 2023-27, entitled:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
JURUPA VALLEY, CALIFORNIA, AUTHORIZING EXECUTION
AND DELIVERY OF A JOINT COMMUNITY FACILITIES
AGREEMENT IN CONNECTION WITH THE BOND
OPPORTUNITIES FOR LAND DEVELOPMENT (BOLD)
PROGRAM AND MAKING A FINDING OF SIGN IFICANT
BENEFITS FOR THE FINANCING OF CERTAIN
IMPROVEMENTS BY A COMMUNITY FACILITIES DISTRICT
TO BE FORMED BY THE CALIFORNIA MUNICIPAL FINANCE
AUTHORITY
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120
STAFF REPORT
DATE: APRIL 20, 2023
TO: HONORABLE MAYOR AND CITY COUNCIL
FROM: ROD BUTLER, CITY MANAGER
SUBJECT: AGENDA ITEM NO. 15.C
PUBLIC HEARING TO CONSIDER A RESOLUTION AUTHORIZING
EXECUTION AND DELIVERY OF JOINT COMMUNITY FACILITIES
AGREEMENT FOR BOND OPPORTUNITIES FOR LAND
DEVELOPMENT (BOLD) PROGRAM FOR DEVELOPMENT IMPACT
FEES FOR TRACT NOS. 36947 AND 32721 (204 SINGLE FAMILY
RESIDENTIAL UNITS) LOCATED WEST OF 28TH STREET AND CANAL STREET; AND MAKING A FINDING OF SIGNIFICANT BENEFITS FOR
THE FINANCING OF CERTAIN IMPROVEMENTS BY A COMMUNITY
FACILITIES DISTRICT TO BE FORMED BY THE CALIFORNIA
MUNICIPAL FINANCE AUTHORITY
RECOMMENDATION
1) That the City Council conduct a public hearing (the “Hearing”) regarding the financing of public improvements to be owned by the City of Jurupa Valley (the “City”) or the Jurupa Area Recreation and Park District (the “Park District”) in connection with the Emerald Ridge/Hacienda development through the formation of a community facilities district and the issuance of bonds by the California Municipal Finance Authority (the “CMFA”); and
2) That the City Council adopt Resolution No. 2023-27, entitled:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF JURUPA VALLEY,
CALIFORNIA, AUTHORIZING EXECUTION AND DELIVERY OF A JOINT
COMMUNITY FACILITIES AGREEMENT IN CONNECTION WITH THE BOND
OPPORTUNITIES FOR LAND DEVELOPMENT (BOLD) PROGRAM AND
MAKING A FINDING OF SIGNIFICANT BENEFITS FOR THE FINANCING OF
CERTAIN IMPROVEMENTS BY A COMMUNITY FACILITIES DISTRICT TO BE
FORMED BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY
RETURN TO AGENDA
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BACKGROUND
CMFA is a joint exercise of powers authority, the members of which includ e numerous cities, counties and other local agencies in the State of California, including the City.
At the request of Highpointe Emerald Ridge LLC and HP-SA ER LLC (the “Developer”), CMFA intends to conduct proceedings under the Mello-Roos Community Facilities Act of 1982 (California Government Code section 53311 et seq.) (the “Mello-Roos Act”) to form a Community Facilities District (the “CFD”) for the Emerald Ridge/Hacienda development as part of CMFA’s Bond Opportunities for Land Development (“ BOLD”) program. Once formed, the CFD will levy special taxes to be paid by the property taxpayers within the CFD. It is expected that the CFD will issue bonds to be secured and repaid by the special tax revenues. The purpose of forming this CFD is to finance ce rtain facilities (the “CFD Improvements”) and/or development impact fees (which fees are used for capital improvements) (the “CFD Fees”).
Although the CFD will be formed within the City’s jurisdiction, the use of the BOLD program means that the CMFA and its consultant team will form and approve the CFD.
CMFA will use the services of a special tax consultant and administrator to create the special tax formula and administer, levy, and collect the special taxes. CMFA will issue and handle the sale of the CFD bonds and handle continuing disclosure reporting requirements relating to the bonds. Except for the holding of the Hearing and as described below in connection with the JCFA, the City will have minimal involvement in any of the formation of the CFD, the issuance of the bonds, or the CFD administration
Per information provided by CMFA and the Developer, it is currently intended that the financed projects will consist of facilities and capital improvements to be owned by the City or the Park District.
ANALYSIS
Public Hearing and Finding of Public Benefits
CMFA has requested that the City Council hold the Hearing. CMFA’s counsel has indicated that pursuant to Government Code Section 6586.5, CMFA can issue bonds for the financing only after the City -- which has land use jurisdiction over the Emerald Ridge/Hacienda development -- holds a public hearing and finds that the financing will result in significant public benefit. Such finding will pertain to not just the City improvements but also the Park District improvements to be financed.
CMFA has provided a copy of the Park District’s resolution, making a finding that the improvements to be financed by the Park District will result in significant public benefit.
By adopting the attached resolution at the conclusion of the Hearing, the City Council will make a finding of significant benefits with respect to the financing of the City improvements and the Park District improvements, based on the Hearing and the Park District resolution.
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Joint Community Facilities Agreement (JCFA); City Projects to be Financed
Under the Mello -Roos Act, CMFA must enter into the JCFA with the City in order to include the City’s improvements as part of the CFD financing. City staff understands that CMFA will enter into a similar agreement with the Park District in connection with the Park District’s improvements.
Pursuant to the City’s JCFA, after CMFA issues bonds for this financing, a portion of the bond proceeds will be deposited into a “Project Fund,” from which the C ity can request disbursements. It is intended that the disbursements will satisfy certain development impact fees that would otherwise be paid by the Developer. The City will then spend moneys so received on capital improvements that would have been funded by the related development impact fees.
CMFA bonds will be issued as “tax-exempt bonds” -- the interest on which, when received by a bondholder, will generally be excluded from federal income tax. There are strict federal tax rules relating to the iss uance of tax-exempt bonds. As indicated in the form of disbursement request attached to the JCFA, the City will have to make certain representations and covenants for the benefit of CMFA in connection with each draw from the Project Fund. Per CMFA’s counsel, to comply with the applicable federal tax law, at the time of bond issuance, there must be a reasonable expectation that a significant portion of the bond proceeds will be spent down within three years.
Because of the restrictions under federal tax l aw, staff recommends that only the transportation circulation improvements of the recently approved Development Impact Fee (DIF) program be included in the JCFA. These projects are the only component of the DIF that staff believes can meet the expenditure time frame. Staff estimates that the transportation circulation improvements fee for residential development amounts to
56.98% of the overall DIF for the Emerald Ridge/Hacienda development project.
Certain Costs
As described above, it is anticipated that CMFA will issue bonds to provide financing for the City’s and the Park District’s improvements. CMFA will pay debt service (principal and interest) on the bonds from the special tax revenues to be collected from the property taxpayers within the CFD. The special tax rates will be established by CMFA taking into consideration the anticipated amounts to be deposited into the project funds for the City improvements and the Park District improvements (and the bond sizing necessary to generate such amounts), plus the costs of issuance of the bonds, and other costs of administering the CFD.
CMFA charges an annual fee for the administration of each community facilities district it forms and a fee for each issuance of bonds (the latter of which is paid out of the bond proceeds). CMFA contributes a portion of the fees it receives to local charities.
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RESOLUTION NO. 2023-27
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF JURUPA
VALLEY, CALIFORNIA, AUTHORIZING EXECUTION AND DELIVERY
OF A JOINT COMMUNITY FACILITIES AGREEMENT IN
CONNECTION WITH THE BOND OPPORTUNITIES FOR LAND
DEVELOPMENT (BOLD) PROGRAM AND MAKING A FINDING OF
SIGNIFICANT BENEFITS FOR THE FINANCING OF CERTAIN
IMPROVEMENTS BY A COMMUNITY FACILITIES DISTRICT TO BE
FORMED BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY
WHEREAS, the California Municipal Finance Authority (the “CMFA”) is a joint exercise of powers authority, the members of which include numerous cities, counties and other local agencies in the State of California (the “State”), including the City of Jurup a Valley (the “City”); and
WHEREAS, at the request of Highpointe Emerald Ridge LLC and HP-SA ER LLC and its successors and assigns (the “Developer”), CMFA has conducted or intends to conduct proceedings under the Mello -Roos Community Facilities Act of 1982 (California Government Code section 53311 et seq.) (the “Act”) to form a community facilities district (the “CFD”) to finance certain public facilities and development impact fees used for capital improvements authorized to be financed under the Act (the “CFD Improvements” and the “CFD Fees,” respectively) as part of its Bond Opportunities for Land Development (“BOLD”) program; and
WHEREAS, CMFA intends to utilize the proceeds of sale of special tax bonds of the CFD to finance some or all of the CFD Improvements and CFD Fees; and
WHEREAS, the CFD Improvements and the public improvements to be financed by the CFD Fees will include roads, parks and other facilities (together, the “Financed Improvements”) to be owned by the City of the Jurupa Area Recreation and Park District (the “Park District”); and
WHEREAS, the Financed Improvements to be owned by the City shall be referred to herein as the “City Improvements” and the Financed Improvements to be owned by the Park District shall be referred to herein as the “Park District Improvements”; and
WHEREAS, under Section 53316.2 of the Act, CMFA may form the CFD to, among other things, finance CFD Fees payable and/or CFD Improvements to be acquired by the City, provided CMFA and the City enter into a joint community facilities agreement; and
WHEREAS, the City is willing to cooperate with CMFA in accomplishing the financing of the City CFD Fees and/or City Improvements eligible to be financed by the Act, and to confer upon CMFA full power to provide financing for such items in the event that proceeds of special taxes and/or bonds in the CFD become available and are utilized for such purpose; and
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WHEREAS, pursuant to Government Code Section 6586.5, notice was published at least five days prior to the adoption of this resolution at a public hearing (the “Hearing”), which was duly conducted by this City Council concerning the significant public benefits of the BOLD Program and the financing of the City Improvements and the Park District Improvements; and
WHEREAS, the governing board of the Park District adopted Resolution No. 2022-02 on January 13, 2022 (the “Park District Resolution”), and made a finding that the issuance of bonds by CMFA in connection with the BOLD Program for the financing of the Park Distric t Improvements will provide significant benefit, including without limitation, savings in effective interest rate, bond preparation, bond underwriting and bond issuance costs and the more efficient delivery of local agency services to residential and commercial development;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Jurupa Valley as follows:
Section 1. Based on the Hearing and the Park District Resolution, the City Council hereby finds and declares that the issuance of bonds by the CMFA in connection with the BOLD Program for the financing of the Financed Improvements will provide significant public benefits, including without limitation, savings in effective interest rate, bond preparation, bond underwriting and bond issuance costs and the more efficient delivery of local agency services to residential and commercial development within the City.
Section 2. The City Council hereby approves the execution and delivery of a joint community facilities agreement with CMFA in connection wi th the development of the approximately 47-acre property owned by the Developer known as “Tract Nos. 36947 and 32721” or “Emerald Ridge /Hacienda” projects . The joint community facilities agreement shall be substantially in the form presented to the City Council and attached hereto as Exhibit A (the “JCFA”), with such changes as the City Manager may deem appropriate or necessary, the execution and delivery of the JCFA being conclusive evidence of the approval of such changes.
The City Council further finds and declares that entrance into the JCFA will be beneficial to residents of the City.
Section 3. The City Manager and other officers of the City are her eby authorized and directed to take such other actions and execute and deliver such other documents as may be necessary or appropriate to accomplish the purposes of this Resolution.
Section 4. This Resolution shall take effect immediately upon its adoptio n. The City Clerk is hereby authorized and directed to transmit a certified copy of this resolution and the JCFA, as executed by the City, to the Secretary of CMFA.
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PASSED, APPROVED AND ADOPTED, by the City Council of the City of Jurupa Valley on this 20th day of April, 2023.
Chris Barajas
Mayor
ATTEST:
Victoria Wasko, CMC
City Clerk
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CERTIFICATION
STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.
CITY OF JURUPA VALLEY )
I, Victoria Wasko, City Clerk of the City of Jurupa Valley, do hereby certify that the foregoing Resolution No. 2023-27 was duly passed and adopted at a meeting of the City Council of the City of Jurupa Valley on the 20th day of April, 2023, by the following vote, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Jurupa Valley, California, this 20th day of April, 2023.
Victoria Wasko, City Clerk
City of Jurupa Valley
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EXHIBIT A
Joint Community Facilities Agreement
(Substantial Final Form)
See attached
CMFA BOLD PROGRAM
Joint Community Facilities Agreement
by and between
CMFA and City of Jurupa Valley
Relating to:
California Municipal Finance Authority
Community Facilities District No. 2023-4
(Jurupa Area Recreation and Park District – Emerald Ridge)
(Tract Nos. 36947 and 32721 in the City)
This Joint Community Facilities Agreement (this “Agreement”) , dated for convenience as of March 1, 2023, by and between the California Municipal Finance Authority, a joint exercise of powers authority duly organized and existing under the Constitution and laws of the state of California (“CMFA”), and the City of Jurupa Valley, a municipal corporation and general law city, duly organized and existing under the Constitution and laws of the state of California (the “ City,” and together with CMFA, the “Parties”).
WITNESSETH:
WHEREAS, at the request of Highpointe Emerald Ridge LLC and HP-SA ER LLC and its successors and assign s (the “Developer”), CMFA intends to conduct proceedings under the Mello-Roos Community Facilities Act of 1982 (California Government Code section 53311 et seq.) (the “Act”) to form a community facilities district (the “CFD”) to finance certain public facilities and development impact fees used for capital improvements authorized to be financed under the Act (the “CFD Improvements” and the “CFD Fees,” respectively) as part of its Bond Opportunities for Land Development (“BOLD”) program;
WHEREAS, the CFD Improvements and CFD Fees will be described in the resolution of formation for the CFD, including CFD Fees payable and/or CFD Improvements to be acquired by the City and set forth on Exhibit A hereto (the “City Fees” and the “ City Improvements,” respectively);
WHEREAS, CMFA intends to utilize the proceeds of sale of special tax bonds of the CFDs (the “Bonds”) to finance some or all of the City Fees and/or City Improvements;
WHEREAS, under Section 53316.2 of the Act, CMFA may form the CFD to, among other things, finance the City Fees and/or City Improvements, provided that CMFA and the City enter into a joint community facilities agreement such as this Agreement; and
WHEREAS, City is willing to cooperate with CMFA in accomplishing the financing of the City Fees and/or City Improvements eligible to be financed by the Act, and to confer upon CMFA full power to provide financing for the City Fees and/or City Improvements in the event that proceeds of special taxes and/or bonds in a CFD become available and are utilized for such purpose; provided, that each other local agency having its development impact fees or similar amounts financed through the CFD (e.g., school district fees) are doing so without receiving any premium above the fee or amount that would otherwise be due and payable; -2-
WHEREAS, this Agreement is made under the authority of Section 53316.2 of the Act ; and
WHEREAS, in consideration for the mutual undertakings of the Parties stated herein, the Parties agree as follows:
AGREEMENT:
1. Administration of CFD and Issuance of Bonds by CMFA. CMFA shall administer the CFD, including employing and paying all consultants, annually levying the special tax and paying and administering the Bonds, and complying with all state and federal requirements appertaining to the proceedings establishing the CFD and issuing and using the proceeds of the Bonds, including the requirements of the United States Internal Revenue Code of 1986, as amended (the “Code”). In addition, the rate and method of apportionment of special tax for the CFD shall take into account the City’s policies regarding overall projected tax rates on properties in the City and account for any special taxes and/or assessments anticipated to be levied by the City (including, but not limited to, those to be levied any community facilities district to be formed by the City to finance services) on properties within the CFD, such that, after taking into account the anticipated assessments to be levie d by the City and any other applicable local agencies on properties within the CFD, the overall projected tax rates on properties in the CFD shall not exceed any maximum amount set forth in any such City policy in effect at the time of formation of the applicable CFD.
2. Agreement to Hold City Fees. CMFA shall hold or cause to be held within a separate fund, account or subaccount (the “Project Fund”) special taxes and/or Bond proceeds from the CFD. All City Fees funded through Bond proceeds shall be deemed paid by the Developer in the amount of the Bond proceeds on the date that such Bond proceeds are deposited in the Project Fund. CMFA shall disburse, or cause to be disbursed , moneys on deposit in the Project Fund only as provided herein.
3. Disbursements from Project Funds. Moneys on deposit in the Project Fund shall be disbursed pursuant to written requisitions of CMFA following receipt by CMFA of requisitions signed by the City, in substantially the form attached hereto as Exhibit B and executed by the City Manager or his or her designee (each, an “Authorized Officer”) . CMFA and its designees, including any trustee or fiscal agent holding funds in a Project Fund, may conclusively rely on such requisitions for purposes of making such disbursements. All disbursements from the Project Fund to the City shall be made by wire transfer of immediately available funds or by check payable to the City’s bank account number at a bank located within the United States on file with CMFA as part of the BOLD program , unless another method of payment is requested in writing by the City.
4. Use of City Fees for Public Capital Improvements . The City shall utilize the City Fees for public capital improvements to be owned by the City. The City acknowledges that, subject to approval of disbursements as set forth in Section 3 above, the City Fees may be financed through a CFD formed by CMFA as part of the BOLD program, through the issuance of one or more series of Bonds and/or from proceeds of special taxes of the CFD.
5. Purchase of City Improvements. To the extent the City is acquiring City Improvements using Bond proceeds or special taxes generated by a CFD, the City shall work with the Developer to put in place all necessary agreements, certificates or other documents required for the City to acquire such improvements. Neither CMFA nor any of its agents shall be -3-
responsible for inspection or review of any such documents relating to financed City Improvements, unless set forth in a separate writ ten agreement between CMFA and the City providing for the same.
6. Amendments. This Agreement may be amended by a writing signed by the Parties, including to update Exhibit A to reflect additional or different City Fees and/or City Improvements to be financed by the CFD.
7. Term of this Agreement. This Agreement shall be in full force and effect from this date to and including its termination by mutual written agreement of the Parties hereto. CMFA agrees to terminate this agreement upon request of the City upon delivery to CMFA of an opinion Bond Counsel to the effect that the termination of this Agreement will not adversely affect the exclusion from gross income of interest on the Bonds for federal income tax purposes.
8. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original.
[Signatures on Following Page]
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IN WITNESS WHEREOF the Parties have caused this Agreement to be executed by their authorized representatives as of the effective date stated above.
CMFA:
CALIFORNIA MUNICIPAL
FINANCE AUTHORITY
By: ______________________________
Name: Edward J. Becker
Title: Executive Director
CITY:
CITY OF JURUPA VALLEY
By: _____________________________
Name: Rod B. Butler
Title: City Manager
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EXHIBIT A
DESCRIPTION OF CITY FEES AND/OR CITY IMPROVEMENTS
Development Impact Fee s for Transportation/Circulation Improvements , in the approximate amount of $639 ,336, as approved by the City Council per Resolution No. 2023-27, adopted on April 20, 2023.
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EXHIBIT B
DISBURSEMENT REQUEST FORM
To:
California Municipal Finance Authority
2111 Palomar Airport Road, Suite 320
Carlsbad, California 92011
Re: BOLD Program - Request for Disbursement of Bond Proceeds
The undersigned, a duly authorized officer of the City of Jurupa Valley (the “City”) hereby requests a disbursement from the Project Fund set forth below, and certifies that the amounts of development impact fees and/or capital improvements listed below have been or will be spent by the City as of the date indicated below or within 5 days thereafter:
Subaccount(s) Amount(s)
[example, CMFA CFD No. 2023-4,
Special Tax Bonds Series 20__, Project Fund] $
Total:
Wiring Instructions: ___________________________
The undersigned hereby additionally certifies as follows:
1. These funds have been or will be used to acquire and/or construct capital improvements, and this disbursement is not being made for the purpose of reinvestment.
2. None of the expenditures for which payment is requested have been reimbursed previously from other sources of funds.
3. If the total amount above is greater than the funds held by CMFA on behalf of the City in the Subaccount(s) identified above , CMFA is authorized to amend the amount requested to be equal to the amount of such funds.
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4. The amounts being disbursed pursuant to this request are being used to finance or refinance certain public infrastructure and facilities (the “Improvements”). The City will own, and for the entire useful life of such Improvements reasonably expects to own, all of such Improvements. The Improvements consist of the following:
[Describe the improvements]
5. To the extent any of such Improvements are sold to an entity that is not a state or local government, the City will seek the advice and approval of bond counsel to CMFA for the BOLD program prior to any such sale. The City will not allow any of such Improvements to be used (fo r example, by lease or other contract) in the trade or business of any nongovernmental persons (other than in their roles as members of the general public). All of such Improvements will be used in the performance of essential governmental functions of the City or another state or local government agency. The average expected useful life of such Improvements is at least ____ years. The representations and covenants contained in this paragraph are intended to support the conclusion that the interest paid on the bonds issued to finance the Improvements is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the “Code”).
Dated:
Signature:
Print Name: