RESOLUTION NO. CC-2610-086
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RESOLUTION NO. CC-2610-086
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDONDO BEACH
AUTHORIZING AND DIRECTING THE ISSUANCE AND SALE OF AN
AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $93,350,000 OF CITY
OF REDONDO BEACH, CALIFORNIA GENERAL OBLIGATION BONDS
(MEASURE FP PUBLIC SAFETY IMPROVEMENTS), SERIES 2026, AND
APPROVING OTHER RELATED ACTIONS IN CONNECTION THEREWITH WHEREAS, the City of Redondo Beach (the “City”) is a charter city duly organized and existing under the laws of the State of California; and
WHEREAS, as discussed in the City’s Capital Improvement Program, the City desires to undertake the acquisition, construction, reconstruction, rehabilitation or replacement of the City’s police and fire facilities (together, the “Improvements”); and WHEREAS, the City has outgrown its aging police and fire facilities, which were built in the 1950s when the City’s population was approximately one-third of the current population; and WHEREAS, the City’s existing fire stations were constructed in 1959 for a total staff of 39 firefighters serving a population of 50,000, and today the fire department responds to over 8,000 emergency calls annually with a total staff of 69 serving a population of 70,000 in the same facilities, which lack adequate space for personnel and paramedic equipment, hindering operational efficiency; and
WHEREAS, on June 28, 2024, the Los Angeles County Civil Grand Jury issued a report on Earthquake Safety Readiness directing cities to prioritize government building resilience and to initiate retrofitting and rebuilding of these buildings to ensure earthquake resilience; and WHEREAS, the City falls within a region that is susceptible to earthquakes due to its proximity to several active fault lines, including the Palos Verdes Fault, the Newport-Inglewood Fault and the San Andreas Fault, and the City is part of the broader Los Angeles area classified as Seismic Zone 4 – the highest seismic risk zone in the United States, indicating a high potential for significant seismic activity; and
WHEREAS, the City’s 911 emergency communication center, police station and fire stations are critical infrastructure and critical components of the emergency response system and must adhere to stringent building codes designed to enhance earthquake resilience and ensure readiness in a disaster, with requirements for seismic retrofitting and/or replacement of older buildings to enhance the earthquake resilience of these buildings as the first points of contact in emergencies, providing immediate response and coordination in any disaster; and WHEREAS, the fire stations need repair, replacement and upgrades, including but not limited to addressing structural cracking, seismic retrofitting, mold and asbestos abatement and removal, outdated plumbing and electrical systems, and adding or updating female sleeping quarters and restrooms to help recruit and retain firefighters and paramedics; and WHEREAS, the police station, which was constructed in 1957 for a total staff of 48, lacks adequate space for current personnel and equipment, hindering operational efficiency for the current roster of approximately 240 Police Department employees; and RESOLUTION NO. CC-2610-086
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WHEREAS, the existing police station needs repair, replacement and upgrades, including but not limited to, mold, asbestos and lead abatement and removal, outdated plumbing and electrical systems, meeting California Structural Performance Category requirements to withstand a strong earthquake, addressing significant roof leaks during storms, updating inadequate restrooms to meet ADA requirements, and updating facilities to utilize more efficient, economical and environmentally friendly energy systems; and
WHEREAS, a new police station will accommodate space for new state-of-the-art technology to enhance the communications center, drone operations, jail operations, and a more contemporary Emergency Operations Center to keep the City secure during the management of emergency incidents; and
WHEREAS, a new police station will incorporate modern security measures to better protect officers and arrestees, allow for community integration and meeting spaces, and foster positive relationships between law enforcement and residents to better accommodate the needs of the community; and
WHEREAS, the undertaking of the Improvements by the City constitutes the acquisition, construction, reconstruction, rehabilitation and/or replacement of “municipal improvements” and “public infrastructure” because the Improvements are (1) part of the structures, facilities and equipment owned and operated under the control of the City, (2) part of the basic, underlying features of the City’s physical landscape, community identity and organization, (3) once acquired or completed, open to the public for use and/or benefiting the public, and (4) necessary or convenient to carry out the objects, purposes and powers of the City; and
WHEREAS, by Resolution No. CC-2407-060, adopted by the City Council (the “City Council”) of the City of Redondo Beach (the “City”) at a meeting held July 30, 2024, it was determined and declared that the public interest and necessity demand the acquisition, construction, reconstruction, rehabilitation or replacement of the Improvements; and
WHEREAS, by Ordinance No. 3274-24 passed by the City Council at a meeting held August 6, 2024, and signed by the Mayor on August 6, 2024 (the “Bond Ordinance”), the City Council duly called a Special Municipal Election consolidated with Los Angeles County to be held and conducted November 5, 2024 (the “Bond Election”), for the purpose of submitting to the qualified voters of the City a proposition to incur bonded indebtedness of the City in the aggregate principal amount not to exceed $93,350,000 to finance the acquisition, construction, reconstruction, rehabilitation or replacement of the Improvements (collectively, the “Project”); and
WHEREAS, the Bond Election was held in the City on November 5, 2024, and thereafter canvassed pursuant to law, at which the following bond proposition (“Measure FP”) summarized as follows was submitted to the electors of the City:
MEASURE FP
“To recruit/retain qualified firefighters/paramedics/police, improve Redondo Beach’s ability to provide fire/police protection and 911 response, help keep Redondo Beach safe by repairing/replacing/upgrading deteriorated fire/police stations/facilities, including removing asbestos and mold, shall Redondo Beach’s measure authorizing $93,350,000 in bonds at legal rates, levying on average $17.45 per $100,000 of assessed valuation, generating approximately $6,280,000 annually while bonds are outstanding, requiring oversight, spending disclosure, and all funds spent locally, be adopted?”; and WHEREAS, Measure FP was approved by more than two-thirds of the qualified voters of the RESOLUTION NO. CC-2610-086
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City voting on such measure, thereby adopting the Bond Ordinance, and the declaration of such Bond Election results was made by the City Council pursuant to its adoption of Resolution No. CC-2412-116 at a meeting held December 10, 2024; and
WHEREAS, the City Council has determined, and does hereby declare, that it is necessary and desirable that all of such bonds designated generally as “City of Redondo Beach, California General Obligation Bonds (Measure FP Public Safety Improvements) Series 2026” (the “Bonds”) in the aggregate principal amount not to exceed $93,350,000, representing the total amount authorized, be issued and sold in a single series on a tax-exempt basis, for the purposes authorized and on the conditions set forth in this Resolution to finance a portion of the costs of the Project; and WHEREAS, the Bonds will be payable from proceeds of the annual tax levy, as provided herein; and
WHEREAS, the Bonds are being issued pursuant to (i) this Resolution duly adopted by the City Council; (ii) the provisions of Article 1 of Chapter 4 of Division 4 of Title 4 (commencing with Section 43600), of the California Government Code, and the provisions of Article 4.5 of Chapter 3 of Part 1 of Division 2 of Title 5 of the California Government Code (collectively, the “Bond Law”); (iii) the Charter of the City (the “Charter”), (iv) the Bond Ordinance, and (v) the Bond Election; and WHEREAS, there shall be delivered a certificate of a duly authorized officer of the City, concurrently with the issuance of the Bonds stating that the outstanding bonded indebtedness of the City, including the Bonds to be issued, will not exceed 15 percent of the total assessed valuation of property within the City in compliance with the provisions of Section 17.11 of the Charter; and WHEREAS, the City Council recognizes that Public Resources Advisory Group, Inc. has been engaged to act as Municipal Advisor (“Municipal Advisor”) to the City and Best, Best & Krieger LLP has been engaged as bond counsel (“Bond Counsel”) and disclosure counsel (“Disclosure Counsel”) to the City with respect to the Bonds; and
WHEREAS, the City Council desires U.S. Bank Trust Company, National Association, to serve as the fiscal agent (the “Fiscal Agent”) for the Bonds, pursuant to a Fiscal Agent Agreement (“Fiscal Agent Agreement”) by and between the City and the Fiscal Agent; and WHEREAS, it is contemplated that the Bonds will be offered pursuant to a Preliminary Official Statement (the “Preliminary Official Statement”) and an Official Notice of Sale (the “Official Notice of Sale”); and
WHEREAS, there have been submitted to and are on file with the City Clerk proposed forms of the Preliminary Official Statement, the Fiscal Agent Agreement, the Official Notice of Sale, and a Continuing Disclosure Agreement (as described in the Preliminary Official Statement, the “Continuing Disclosure Agreement”), all relating to the Bonds proposed to be issued and sold; WHEREAS, Section 5852.1 of the Government Code requires that the City Council obtain from an underwriter, financial advisor or private lender and disclose, prior to authorization of the issuance of bonds with a term of greater than 13 months, good faith estimates of the following information in a meeting open to the public: (a) the true interest cost of the bonds, (b) the sum of all fees and charges paid to third parties with respect to the bonds, (c) the amount of proceeds of the bonds expected to be received net of the fees and charges paid to third parties and any reserves or capitalized interest paid or funded with proceeds of the bonds, and (d) the sum total of all debt service payments on the bonds calculated to the final maturity of the bonds plus the fees and charges paid to third parties not paid with the proceeds of the bonds; and in compliance with said Section 5852.1, the City Council has obtained RESOLUTION NO. CC-2610-086
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from the Municipal Advisor the required good faith estimates for the Bonds as set forth in Appendix A attached to this Resolution, and such information is hereby disclosed and made public; WHEREAS, the City Council desires to ratify and confirm the findings and determinations of Resolution No. CC-2503-017, entitled “A Resolution of the City Council of the City of Redondo Beach Declaring Its Intent to Reimburse Certain Expenditures from Proceeds of General Obligation Bonds Approved by the Voters of the City of Redondo Beach, adopted March 18, 2025 (the “Reimbursement Resolution”); and
WHEREAS, all acts, conditions and things required by the Constitution and laws of the State of California to exist, to have happened and to have been performed precedent to and in connection with the consummation of the transactions authorized hereby do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the City is now duly authorized and empowered, pursuant to each and every requirement of law, to consummate such transactions for the purpose, in the manner and upon the terms herein provided.
NOW, THEREFORE, BE IT RESOLVED, BY THE CITY COUNCIL OF THE CITY OF REDONDO BEACH AS FOLLOWS:
Section 1. Declaration and Findings of City Council. The City Council hereby specifically finds and declares that the actions authorized hereby constitute and are with respect to public affairs of the City, and that the statements, findings and determinations of the City set forth herein, in the preambles above and in the documents approved herein are true and correct.
Section 2. Conditions Precedent. All conditions, things and acts required by law to exist, to happen and to be performed precedent to the adoption of this Resolution authorizing the issuance of the Bonds exist, have happened and have been performed in due time, form and manner in accordance with applicable law, and the City is now authorized pursuant to the Charter and applicable law to incur indebtedness in the manner and form provided in this Resolution.
Section 3. Issuance and Sale of the Bonds; Determination of Certain Terms; Designation. The City Council authorizes the issuance and sale of not to exceed $93,350,000 in aggregate principal amount of Bonds to be designated as “City of Redondo Beach, California General Obligation Bonds (Measure FP Public Safety Improvements), Series 2026,” for the purposes set forth in the Bond Ordinance and Measure FP approved by the voters at the Bond Election.
The City Manager, City Treasurer, or Finance Director of the City, or a designee thereof (each, an “Authorized Officer”) is authorized to determine, for the Bonds, the sale date, the interest rates, the definitive principal amount, the maturity dates and the redemption dates, if any, and the terms of any optional or mandatory redemption, subject to the other specific provisions of this Resolution, including the following terms and conditions: (a) the Bonds shall not have a true interest cost (as such term is defined in the Official Notice of Sale for the Bonds) in excess of 7% per annum; and (b) the Bonds may have a duration up to 30 years from their date of issuance. Any Authorized Officer is hereby authorized to modify the general designation of the Bonds if in his or her sole discretion a different designation is in the best interest of the City for administrative, marketing or descriptive purposes.
Section 4. Authentication and Registration. The Fiscal Agent Agreement for the Bonds shall set forth the form of Bond, with such necessary or appropriate variations, omissions and insertions as may be permitted by resolution. “CUSIP” identification numbers may be imprinted on the Bonds, but such numbers shall not constitute a part of the contract evidenced by the Bonds, and any error or omission with respect thereto shall not constitute cause for refusal of any purchaser to accept delivery of and to pay for the Bonds. In addition, failure on the part of the City to use such CUSIP numbers in any notice RESOLUTION NO. CC-2610-086
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to owners of the Bonds shall not constitute an event of default or any violation of the City’s contract with such owners and shall not impair the effectiveness of any such notice.
The Bonds shall be signed by the Mayor of the City (the “Mayor”) and countersigned by the City Clerk of the City as provided in the Fiscal Agent Agreement. In case any such officers whose facsimile signature or countersignature appears on a Bond shall cease to be such officer before the delivery of such Bond to the purchaser, such signature or countersignature shall nevertheless be valid and sufficient for all purposes as if said officers had remained in office until the delivery of such Bond.
The officers of the City are directed to cause the Bonds to be prepared in sufficient quantity for delivery to or for the account of the purchaser of the Bonds, and the Finance Director is directed to cause the blanks in the Bonds to be completed in accordance with this Resolution and the Bond Award (as defined below), to procure their execution by the proper officers of the City and authentication by the Fiscal Agent as provided in the Fiscal Agent Agreement, and to deliver the Bonds when so executed and authenticated to the purchaser in exchange for the purchase price, all in accordance with this Resolution and the Fiscal Agent Agreement. Only Bonds bearing a certificate of authentication and registration executed by the Fiscal Agent shall be valid or obligatory for any purpose or entitled to the benefits of this Resolution.
Books for the registration and transfer of the Bonds shall be kept by the Fiscal Agent as provided in the Fiscal Agent Agreement. An Authorized Officer and the Fiscal Agent may treat the registered owner of each Bond as its absolute owner for all purposes, and the Authorized Officer and the Fiscal Agent shall not be affected by any notice to the contrary.
Section 5. Transfer or Exchange and Registration of Bonds. Any Bond may be transferred or exchanged in accordance with its terms and the terms of the Fiscal Agent Agreement. Each Bond shall be registered in accordance with the terms of the Fiscal Agent Agreement.
Section 6. Terms of the Bonds; Redemption of the Bonds. (a) Date of the Bonds. The Bonds shall be dated the date of their delivery or such other date (“Dated Date”) as is specified in the Bond Award.
(b) Denominations. The Bonds shall be issued in fully registered form, without coupons, in the denomination of $5,000 principal amount or any integral multiple thereof, provided that no Bond shall mature on more than one maturity date.
(c) Maturity. The Bonds shall mature on the date or dates, in each of the years, and in such principal amounts as shall be set forth in the Bond Award and the Fiscal Agent Agreement. (d) Payment of the Bonds. The principal and any redemption premium of the Bonds shall be payable in lawful money of the United States of America to the owner thereof, upon the surrender thereof at the office of the Fiscal Agent designated for the purpose, as provided in the Fiscal Agent Agreement. The interest on the Bonds shall be payable in like lawful money to the person whose name appears on the bond registration books of the Fiscal Agent as the person in whose name such Bond is registered thereof as of the close of business on the applicable record date for each interest payment date, whether or not such day is a Business Day, as provided in the Fiscal Agent Agreement. “Business Day” shall mean a day which is not (a) a Saturday, Sunday or legal holiday in the State of California, (b) a day on which banking institutions in the State of California, or in any state in which the office of the Fiscal Agent is located, are required or authorized by law (including executive order) to close, or (c) a day on which the New York Stock Exchange is closed.
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(e) Redemption of the Bonds. The Bonds are subject to optional and mandatory sinking fund redemption prior to their respective stated maturity dates as set forth in the Fiscal Agent Agreement and in the Bonds.
Section 7. Appointment of Depositories and Other Agents. An Authorized Officer is authorized and directed to appoint one or more depositories as he or she may deem desirable. The City will not have any responsibility or obligation to any purchaser of a beneficial ownership interest in any Bonds or to any participants in such a depository with respect to (a) the accuracy of any records maintained by such securities depository or any participant therein; (b) any notice that is permitted or required to be given to the owners of Bonds under this Resolution; (c) the selection by such securities depository or any participant therein of any person to receive payment in the event of a partial redemption of Bonds; (d) the payment by such securities depository or any participant therein of any amount with respect to the principal or redemption premium, if any, or interest due with respect to Bonds; (e) any consent given or other action taken by such securities depository as the owner of Bonds; or (f) any other matter.
The Depository Trust Company, New York New York (“DTC”) is appointed as depository for the Bonds. The Bonds shall be initially issued in book-entry form. Upon initial issuance, the ownership of each Bond shall be registered in the bond register in the name of Cede & Co., as nominee of DTC. So long as each Bond is registered in book-entry form, each Bond shall be registered in the name of Cede & Co. or in the name of such successor nominee as may be designated from time to time by DTC or any successor as depository as provided in the Fiscal Agent Agreement.
An Authorized Officer is also authorized and directed to appoint one or more agents as he or she may deem necessary or desirable, to the extent permitted by applicable law and under the supervision of the Authorized Officer, such agents may serve as paying agent, fiscal agent, escrow agent or registrar for the Bonds or may assist the Authorized Officer in performing any or all of such functions and such other duties as the Authorized Officer shall determine. Such agents shall serve under such terms and conditions as the Authorized Officer shall determine. An Authorized Officer may remove or replace agents appointed pursuant to this paragraph at any time.
An Authorized Officer is also authorized and directed to appoint a rebate calculation agent as he or she may deem necessary or desirable. Such agent shall serve under such terms and conditions as the Authorized Officer shall determine. An Authorized Officer may remove or replace such agent appointed pursuant to this paragraph at any time.
Section 8. Tax Levy; Pledge of Tax Revenues Fund and Bond Fund. (a) Tax Levy. For the purpose of paying the principal of and interest on the Bonds, the City Council at the time of fixing the general tax levy shall fix, and in the manner provided for such general tax levy, levy and collect annually until the Bonds are paid, or until there shall be a sum set apart for that purpose in the treasury of the City sufficient to meet all sums coming due for payment of principal of and interest on the Bonds, a tax sufficient to pay the annual interest on the Bonds as the same becomes due and also such part of the principal thereof as shall become due before the proceeds of a tax levied at the time for making the next general tax levy can be made available for the payment of such interest or principal; provided, however, that in fixing such tax levy for each fiscal year, the City Council shall take into account amounts then on deposit in the Tax Revenues Fund pursuant to this paragraph (a), if such amounts will be available to pay debt service on the Bonds. Such tax shall be in addition to all other taxes levied for City purposes, shall be collected at the time and in the same manner as other taxes of the City are collected, and shall be used only for the payment of the Bonds and the interest thereon. All taxes collected pursuant to this RESOLUTION NO. CC-2610-086
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paragraph (a) shall be deposited forthwith in a special fund to be designated as the “General Obligation Bonds (Measure FP Public Safety Improvements) Tax Revenues Fund” (the “Tax Revenues Fund”). The Tax Revenues Fund and all accounts therein shall be established, maintained and administered by an Authorized Officer pursuant to this Resolution and the Fiscal Agent Agreement. An Authorized Officer shall cause amounts on deposit in the Tax Revenues Fund to be transferred to the Fiscal Agent for payment of the principal of, premium, if any, and interest on outstanding Bonds when due. The Tax Revenues Fund shall be kept separate and apart from all other funds, and each account therein shall be kept separate and apart from all other accounts. Additional accounts and subaccounts within the Tax Revenues Fund may be established.
Bond Fund. Pursuant to this Section 8(a) there shall be established a special fund to be designated as the “General Obligation Bonds (Measure FP Public Safety Improvements) Bond Fund” (the “Bond Fund”). The Bond Fund and all accounts therein shall be maintained and administered by the Fiscal Agent pursuant to this Resolution and the Fiscal Agent Agreement. The Bond Fund shall be kept separate and apart from all other funds, and each account therein shall be kept separate and apart from all other accounts. Additional accounts and subaccounts within the Bond Account may be established. The Fiscal Agent shall deposit in the Bond Fund from the proceeds of sale of the Bonds, all or a portion of the moneys received on account of original issue premium and interest accrued on the Bonds to the date of payment of the purchase price thereof as directed by the City, and such other moneys, if any, as may be specified in the Fiscal Agent Agreement. So long as any of the Bonds are outstanding, moneys in the Bond Fund shall be used and applied by the Fiscal Agent solely for the purpose of paying the principal of and interest on the Bonds as such principal and interest shall become due and payable, or for purchase of Bonds; provided, however, that when all of the principal of and interest on the Bonds have been paid, any moneys then remaining in such Bond Fund shall be transferred to the City for any legally permitted purpose.
Budget and Appropriations. The City Council shall take such actions annually as are necessary or appropriate to cause the debt service on the Bonds due in any fiscal year to be included in the budget for such fiscal year and to make the necessary appropriations therefor.
(b) Pledge. The Tax Revenues Fund and the Bond Fund and all accounts and amounts on deposit therein are hereby pledged for the payment of the principal of and interest on the Bonds when and as the same become due, including the principal of any term Bonds required to be paid upon the mandatory sinking fund redemption thereof. In addition, the payment of such principal and interest shall be secured by the statutory lien of California Government Code Section 53515, to the extent applicable to the amounts on deposit in the Bond Fund. Each and every Bond issued under this Resolution shall be equally and ratably secured by the pledge effected in this Section 8(b), the foregoing statutory lien, and the taxes collected pursuant to Section 8(a).
Section 9. Administration and Disbursements From Bond Fund. (a) Interest. On or before five (5) Business Days prior to [March] 1 and [September 1] in each year that any of the Bonds are outstanding, an Authorized Officer shall transfer from the Tax Revenues Fund to the Fiscal Agent to set aside in a special account to be designated as the “Interest Account,” which shall be an account within the Bond Fund, an amount which will be equal to the aggregate amount of the interest becoming due and payable on each of the Bonds outstanding on the such Interest Payment Date, for the purpose of paying the interest RESOLUTION NO. CC-2610-086
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on the Bonds.
(b) Principal. On or before five (5) Business Days prior to [September] 1 in each year that any of the Bonds are outstanding, an Authorized Officer shall transfer from the Tax Revenues Fund to the Fiscal Agent to set aside in a special account to be designated as the “Principal Account,” which shall be an account within the Bond Fund, an amount which will be equal to the principal on the Bonds outstanding that will become due and payable on such [September] 1, including those Bonds subject to mandatory redemption on such date pursuant to the provisions of the Fiscal Agent Agreement, for the purpose of paying the principal and mandatory redemption of the Bonds.
All moneys in the Bond Fund shall be used and withdrawn by the Fiscal Agent solely for the purpose of paying the principal of (including mandatory redemption), premium, if any, and interest on the Bonds as the same shall become due and payable.
Section 10. Capital Project Fund. There is hereby established a special project fund to be designated as the “General Obligation Bonds (Measure FP Public Safety Improvements) Capital Project Fund” (the “Capital Project Fund”), and established therein a special account to be designated as the “General Obligation Bonds (Measure FP Public Safety Improvements) Costs of Issuance Account of the Capital Project Fund” (the “Costs of Issuance Account”), and a special account to be designated as the “General Obligation Bonds (Measure FP Public Safety Improvements) Project Account of the Capital Project Fund” (the “Project Account”). The Capital Project Fund shall be maintained by the Fiscal Agent, as a separate fund, segregated and distinct from all other funds and accounts. The Fiscal Agent may establish such accounts and subaccounts within the Capital Project Fund, in addition to the Costs of Issuance Account and the Project Account, as may be necessary or convenient in connection with the administration of the Project or the Bonds.
All of the proceeds of the sale of the Bonds (excluding premium and accrued interest received thereon, unless otherwise directed by an Authorized Officer) shall be deposited by the Fiscal Agent to the credit of the Project Account within the Capital Project Fund and shall be applied exclusively to the objects and purposes of the Project in accordance with the Fiscal Agent Agreement.
When such objects and purposes have been accomplished, any moneys remaining in the Project Account of the Capital Project Fund, shall be transferred to the Bond Fund established pursuant to Section 8 and applied to the payment of the principal of and interest on the Bonds.
A portion of the premium and accrued interest received on the Bonds as directed by an Authorized Officer shall be deposited by the Fiscal Agent to the credit of the Costs of Issuance Account within the Capital Project Fund. Amounts in the Costs of Issuance Account may be applied to the payment of costs of issuance of the Bonds, including, without limitation, costs of the Bond Election, underwriter’s discount, bond and financial printing expenses, mailing and publication expenses, rating agency fees, and the fees and expenses of fiscal agents, paying agents, registrars, financial consultants, the Municipal Advisor, Bond Counsel and Disclosure Counsel, in accordance with the provisions of the Fiscal Agent Agreement.
Section 11. Defeasance Provisions. Payment of all or any portion of the Bonds may be provided for prior to such Bonds’ respective stated maturities as set forth in Section 4.03 of the Fiscal Agent Agreement.
Section 12. Tax Covenants.
(a) Definitions. When used in this Section, the following terms have the following meanings:
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“Closing Date” means the date on which the Bonds are first authenticated and delivered to the initial purchasers against payment therefor.
“Code” means the Internal Revenue Code of 1986, as amended by all legislation, if any, effective on or before the Closing Date.
“Computation Date” has the meaning set forth in Section 1.148-1(b) of the Regulations. “Final Computation Date” has the meaning set forth in Section 1 148-3(e)(2) of the Regulations.
“Gross Proceeds” means any proceeds as defined in Section 1.148-1(b) of the Regulations, and any replacement proceeds as defined in Section 1.148-1(c) of the Regulations, of the Bonds.
“Investment” has the meaning set forth in Section 1.148-1(b) of the Regulations. “Nonpurpose Investment” means any investment property, as defined in Section 148(b) of the Code, in which Gross Proceeds of the Bonds are invested and which is not acquired to carry out the governmental purposes of the Bonds. “Rebate Amount” has the meaning set forth in Section 1.148-1(b) of the Regulations. “Regulations” means any proposed, temporary, or final Income Tax Regulations issued pursuant to Sections 103 and 141 through 150 of the Code, and Section 103 of the Internal Revenue Code of 1954, which are applicable to the Bonds. Any reference to any specific Regulation shall also mean, as appropriate, any proposed, temporary or final Income Tax Regulation designed to supplement, amend or replace the specific Regulation referenced.
“Yield” of:
(i) any Investment has the meaning set forth in Section 1.148-5 of the Regulations; and
(ii) the Bonds has the meaning set forth in Section 1.148-4 of the Regulations.
(b) Not to Cause Interest to Become Taxable. The City shall neither use, nor permit the use of, or nor omit to use Gross Proceeds or any other amounts (or any property the acquisition, construction or improvement of which is to be financed directly or indirectly with Gross Proceeds) in a manner which if made or omitted, respectively, would cause the interest on any Bond to become includable in the gross income, as defined in Section 61 of the Code, of the owner thereof for federal income tax purposes. Without limiting the generality of the foregoing, unless and until the City receives a written opinion of counsel nationally recognized in the field of municipal bond law to the effect that failure to comply with such covenant will not adversely affect the exemption from federal income tax of the interest on any Bond, the City shall comply with each of the specific covenants in this Section 12. (c) No Private Use or Private Payments. Except as permitted by Section 141 of the Code and the Regulations and rulings thereunder, the City shall at all times prior to the final payment on the Bonds:
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(i) exclusively own, operate and possess all property, the acquisition, construction or improvement of which is to be financed or refinanced directly or indirectly with Gross Proceeds of the Bonds, and not use or permit the use of such Gross Proceeds (including all contractual arrangements with terms different from those applicable to the general public) or any property acquired, constructed or improved with such Gross Proceeds in any activity carried on by any person or entity (including the United States or any agency, department and instrumentality thereof) other than a state or local government, unless such use is solely as a member of the general public; and
(ii) not directly or indirectly impose or accept any charge or other payment by any person or entity who is treated as using Gross Proceeds of the Bonds or any property the acquisition, construction or improvement of which is to be financed or refinanced directly or indirectly with such Gross Proceeds, other than taxes of general application within the City or interest earned on investments acquired with such Gross Proceeds pending application for their intended purposes. (d) No Private Loan. Except to the extent permitted by Section 141 of the Code and the Regulations and rulings thereunder, the City shall not use Gross Proceeds of the Bonds to make or finance loans to any person or entity other than a state or local government. For purposes of the foregoing covenant, such Gross Proceeds are considered to be “loaned” to a person or entity if: (i) property acquired, constructed or improved with such Gross Proceeds is sold or leased to such person or entity in a transaction which creates a debt for federal income tax purposes; (ii) capacity in or service from such property is committed to such person or entity under a take-or-pay, output or similar contract or arrangement; or (iii) indirect benefits, or burdens and benefits of ownership, of such Gross Proceeds or any property acquired, constructed or improved with such Gross Proceeds are otherwise transferred in a transaction which is the economic equivalent of a loan. (e) Not to Invest at Higher Yield. Except to the extent permitted by Section 148 of the Code and the Regulations and rulings thereunder, the City shall not at any time prior to the final stated maturity of the Bonds directly or indirectly invest Gross Proceeds in any Investment, if as a result of such investment the Yield of any Investment acquired with Gross Proceeds, whether then held or previously disposed of, exceeds the Yield of the Bonds. (f) Not Federally Guaranteed. Except to the extent permitted by Section 149(b) of the Code and the Regulations and rulings thereunder, the City shall not take or omit to take any action which would cause the Bonds to be federally guaranteed within the meaning of Section 149(b) of the Code and the Regulations and rulings thereunder. (g) Information Reporting. The City shall timely file the information required by Section 149(e) of the Code with the Secretary of the Treasury on Form 8038-G or such other form and in such place as the Secretary may prescribe.
(h) Rebate of Arbitrage Profits. Except to the extent otherwise provided in Section 148(f) of the Code and the Regulations and rulings thereunder:
(i) The City shall account for all Gross Proceeds (including all receipts, expenditures and investments thereof) on its books of account separately and apart from all other funds (and receipts, expenditures and investments thereof) and shall retain all records of accounting for at least six years after the day on which the last outstanding Bond is discharged. However, to the extent permitted by law, the RESOLUTION NO. CC-2610-086
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City may commingle Gross Proceeds of the Bonds with other money of the City; provided that the City separately accounts for each receipt and expenditure of Gross Proceeds and the obligations acquired therewith.
(ii) Not less frequently than each Computation Date, the City shall calculate the Rebate Amount in accordance with rules set forth in Section 148(f) of the Code and the Regulations and rulings thereunder. The City shall maintain such calculations with its official transcript of proceedings relating to the issuance of the Bonds until six years after the Final Computation Date. (iii) As additional consideration for the purchase of the Bonds by the initial purchasers and the loan of the money represented thereby and in order to induce such purchase by measures designed to ensure the excludability of the interest thereon from gross income for federal income tax purposes, the City shall pay to the United States the amount that when added to the future value of previous rebate payments made for the Bonds equals (A) in the case of a Final Computation Date, 100% of the Rebate Amount on such date; and (B) in the case of any other Computation Date, 90% of the Rebate Amount on such date. In all cases, the rebate payments shall be made at the times, in the installments, to the place and in the manner as is or may be required by Section 148(f) of the Code and the Regulations and rulings thereunder, and shall be accompanied by Form 8038-T or such other forms and information as is or may be required by Section 148(f) of the Code and the Regulations and rulings thereunder. (iv) The City shall exercise reasonable diligence to assure that no errors are made in the calculations and payments required by paragraphs (ii) and (iii) of this paragraph (h), and if an error is made, to discover and promptly correct such error within a reasonable amount of time thereafter (and in all events within 180 days after discovery of the error), including payment to the United States of any additional Rebate Amount owed to it, interest thereon, and any penalty imposed under Section 1.148-3(h) of the Regulations.
(i) Not to Divert Arbitrage Profits. Except to the extent permitted by Section 148 of the Code and the Regulations and rulings thereunder, the City shall not, at any time prior to the final payment on the Bonds, enter into any transaction that reduces the amount required to be paid to the United States pursuant to paragraph (h) above because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm’s length and had the Yield of the Bonds not been relevant to either party. (j) Elections. The City directs and authorizes an Authorized Officer to make elections permitted or required pursuant to the provisions of the Code or the Regulations, as they deem necessary or appropriate in connection with the Bonds, in the Tax Certificate or similar or other appropriate certificate, form or document.
Section 13. Supplemental Resolutions. For any one or more of the following purposes and at any time or from time to time, a supplemental resolution of the City may be adopted, which, without the requirement of consent of the owners of the Bonds, shall be fully effective in accordance with its terms:
(a) To add to the covenants and agreements of the City in this Resolution, other covenants and agreements to be observed by the City which are not contrary to or inconsistent with this Resolution as theretofore in effect;
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(b) To add to the limitations and restrictions in this Resolution, other limitations and restrictions to be observed by the City which are not contrary to or inconsistent with this Resolution as theretofore in effect;
(c) To confirm, as further assurance, any pledge under, and the subjection to any lien or pledge created or to be created by this Resolution as then in effect, of any moneys, securities or funds, or to establish any additional funds or accounts to be held under this Resolution; (d) To cure any ambiguity, supply any omission, or cure or correct any defect or inconsistent provision in this Resolution; or
(e) To make such additions, deletions or modifications as shall not be materially adverse to the owners of the Bonds.
Any modification or amendment of this Resolution and of the rights and obligations of the City and of the owners of the Bonds, in any particular, may be made by a supplemental resolution, with the written consent of the owners of at least a majority in aggregate principal amount of the Bonds outstanding at the time such consent is given (except as provided in the preceding paragraph). No such modification or amendment shall permit a change in the terms or maturity of the principal of any outstanding Bonds or of any interest payable thereon or a reduction in the principal amount thereof or in the rate of interest thereon, or shall reduce the percentage of Bonds the consent of the owners of which is required to effect any such modification or amendment, or shall reduce the amount of moneys for the repayment of the Bonds, without the consent of all the owners of such affected Bonds.
Section 14. Fiscal Agent Agreement. The form of the Fiscal Agent Agreement presented to this meeting and on file with the City Clerk is hereby approved. An Authorized Officer is hereby authorized and directed, for and on behalf of the City, to execute and deliver said Fiscal Agent Agreement in substantially said form, with such changes therein as such officer may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof.
Section 15. Continuing Disclosure Agreement. The form of the Continuing Disclosure Agreement presented to this meeting and on file with the City Clerk is hereby approved. An Authorized Officer is hereby authorized and directed, for and in the name and on behalf of the City, to execute and deliver said Continuing Disclosure Agreement in substantially said form, with such changes therein as such officer may require or approve, such approval to be conclusively evidenced by the acknowledgement and delivery thereof.
Section 16. Sale of the Bonds. An Authorized Officer is hereby authorized to cause the Bonds to be sold by competitive sale under an Official Notice of Sale.
The form of the Official Notice of Sale presented to this meeting and on file with the City Clerk is hereby approved. An Authorized Officer is hereby authorized and directed to conduct the competitive sale of the Bonds in accordance with the Official Notice of Sale in substantially said form, with such changes therein as such officer may require or approve, such approval to be conclusively evidenced by the acknowledgement and delivery thereof.
An Authorized Officer is hereby authorized to award the Bonds to the responsible bidder whose bid (i) is timely received and conforms to the Official Notice of Sale, except to the extent informalities and irregularities are waived by the City as permitted by the Official Notice of Sale; and (ii) represents the lowest true interest cost to the City in accordance with the procedures described in the Official Notice of Sale (the “Bond Award”). The Bond Award, if made, shall be set forth in a certificate signed by an Authorized Officer setting forth the terms of the Bonds and the original purchasers.
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Pursuant to Section 53692 of the Government Code, Public Resources Advisory Group, Inc., the City’s Municipal Advisor, is hereby authorized and directed to cause a notice of the intention to sell the Bonds to be published and disseminated among prospective bidders of the Bonds, in form and substance acceptable to said firm, in the manner required by applicable law.
Section 17. Official Statement. The form of the preliminary Official Statement of the City relating to the Bonds presented to this meeting and on file with the City Clerk is hereby approved in substantially said form, with such changes therein as an Authorized Officer may require or approve. An Authorized Officer is hereby authorized to certify that the preliminary Official Statement, with such changes therein as the officer so certifying shall approve, are, as of their respective dates “deemed final” for purposes of Rule 15c2-12 of the Securities and Exchange Commission. The Authorized Officer is hereby authorized to execute for and on behalf of the City the final Official Statement, in substantially the form of the preliminary Official Statement, with such changes therein (and additions thereto to reflect the terms of the sale of the Bonds) as an Authorized Officer shall approve, such approval to be evidenced by the execution and delivery thereof. The successful bidder for the Bonds is hereby authorized to distribute the Official Statement and any such amendment or supplement thereto to the purchasers of the Bonds.
Section 18. Disposition of Proceeds of Sale. The proceeds of sale of the Bonds shall be applied by the Fiscal Agent as directed by the Authorized Officer as further specified in the Fiscal Agent Agreement, as follows: (a) accrued interest, if any, shall be deposited into the Interest Account of the Bond Fund; (b) a portion of the premium, if any, shall be deposited into the Interest Account of the Bond Fund in such amount not to exceed three years of interest on the Bonds; (c) a portion of the premium, if any, shall be deposited into the Costs of Issuance Account of the Capital Project Fund, and (d) remaining proceeds of sale shall be deposited into the Project Account of the Capital Project Fund established under Section 10.
Section 19. Attestations. The City Clerk is hereby authorized and directed to attest the signature of an Authorized Officer or such other City officers, as may be required or appropriate in connection with the execution and delivery or acknowledgement of said Fiscal Agent Agreement, Official Statement or related documents.
Section 20. Approval of Professionals. The appointments of Best Best & Krieger LLP, as Bond Counsel and Disclosure Counsel and Public Resources Advisory Group, Inc., as Municipal Advisor, are hereby ratified and approved.
Section 21. Accountability Reports. The Bonds are subject to accountability requirements under the Bond Ordinance. Accountability report(s) with respect to the Bonds shall be submitted in all other respects in the manner required by the Bond Ordinance.
Section 22. Reimbursement Resolution. The City Council hereby ratifies and confirms as true and correct the findings and determinations in the preambles to and declarations made in the Reimbursement Resolution.
Section 23. Other Actions. The Authorized Officers and the City Clerk and the other officers of the City are hereby authorized and directed jointly and severally to do any and all things and to execute and deliver any and all documents which they may deem necessary or advisable in order to consummate the transactions contemplated and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution. Such actions heretofore taken by such officers are hereby ratified, confirmed and approved.
Section 24. Effective Date. This Resolution shall take effect from and after its date of passage and RESOLUTION NO. CC-2610-086
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adoption. That the City Clerk shall certify to the passage and adoption of this Resolution and shall enter the same in the Book of Original Resolutions.
PASSED, APPROVED AND ADOPTED this 13th day of October, 2026.
James A. Light, Mayor
APPROVED AS TO FORM: ATTEST:
Joy A. Ford, City Attorney Eleanor Manzano, CMC, City Clerk RESOLUTION NO. CC-2610-086
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STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss
CITY OF REDONDO BEACH)
I, Eleanor Manzano, City Clerk of the City of Redondo Beach, California, do hereby certify that Resolution No. CC-2610-086 was passed and adopted by the City Council of the City of Redondo Beach, California, at a regular meeting of said City Council held on the 13th day of October, 2026, and there after signed and approved by the Mayor and attested by the City Clerk, and that said resolution was adopted by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
_______________________
Eleanor Manzano, CMC
City Clerk