WEST PATTERSON FINANCING AUTHORITY
AGENDA REPORT
TO: Chair McCord and Members of the West Patterson Financing Authority FROM: Ken Irwin, Executive Director
BY: Nubia Goldstein, City Attorney
MEETING DATE: July 19, 2022
ITEM NO: 8.1
SUBJECT: Approve West Patterson Financing Authority Resolution No. 2022- 01 Approving Joint Community Facilities Agreement Between Patterson Joint Unified School District and City of Patterson, to Provide Funding for School Facilities for the Villages of Patterson.
RECOMMENDATION
Motion to Approve West Patterson Financing Authority Resolution No. 2022-01 Joint Community Facilities Agreement Between Patterson Joint Unified School District and City of Patterson, to Provide Funding for School Facilities for the Villages of Patterson.
BACKGROUND & ANALYSIS
The Villages of Patterson Development Project (the “Villages”) began in 2006. The Villages involves 692 acres located south of Eucalyptus Avenue, east of State Highway 33, west of Sycamore Avenue, and north of Walnut Avenue. Development in the Villages stalled for a period of time but has progressed in recent years. In the Phase 1 area south of Olive Avenue the City has now approved multiple final subdivision maps and issued over 150 building permits.
Community Facilities Districts (often referred to as “Mello-Roos Districts”) are land-financing districts that help fund the infrastructure and public facilities for new development. In 2018, the City Council, acting as the Board of Directors of the West Patterson Financing Authority (the “Authority”), formed Community Facilities District No. 2018-1 (“CFD 2018-1”). The Authority formed CFD 2018-1 to finance infrastructure and public facilities for the Villages (such as improvements for water, sewer, storm drainage, roadways, and schools). In October 2021 the Authority issued the first bond series for CFD 2018-1 in the amount of approximately $5 million.
The Authority will issue more bond series as building continues in the Villages.
Different agreements detail the financing of the school facilities for the Villages. The Villages developers are subject to a School Facilities Mitigation Agreement with the Patterson Joint Unified School District (“School District”). The City and the Developers are also subject to the Villages Development Agreement. Both of these agreements provide that the financing district formed for the Villages (here, CFD 2018-1) will provide $12 million to the School District for new school facilities.
Public agencies must enter into a “Joint CFD Agreement” where a CFD will fund improvements or facilities that will be owned by different public agencies. A Joint CFD Agreement allows the public agency in charge of the CFD to send CFD funds to the other public agency. The attached Joint CFD Agreement is between the Authority and School District, and contains the following terms in accordance with the School Facilities Mitigation Agreement and the Development Agreement:
· School District will receive $1 million from the first bond issuance, which staff has set aside to send to the School District after execution of the Joint CFD Agreement. · School District will receive $5 million from the second bond series. · School District will receive $6 million from the fourth bond series.
Upon execution of the Joint CFD Agreement, the authorized officers of CFD 2018-1 can begin transferring bond proceeds to the School District, which the School District will use to finance the construction of the school facilities in the Villages.
FISCAL IMPACT
The Joint CFD Agreement is connected to funds that the Authority receives from CFD 2018-1.
Execution of the Joint CFD Agreement establishes the timing of payments to the School District using bond proceeds from CFD 2018-1. Payment to the School District only occurs as the Authority issues and receives more bond series.
ATTACHMENTS
WPFA Resolution No. 2022-01
Joint CFD Agreement between School District and City of Patterson (attached as Exhibit A to the Resolution)