Agenda Item #4.1
For Council Meeting of: October 13, 2026
CITY OF SANTA ROSA
CITY COUNCIL
TO: MAYOR AND CITY COUNCIL
FROM: SCOTT WAGNER, CHIEF FINANCIAL OFFICER
SUBJECT: ISSUANCE OF MUNICIPAL BONDS AND DISCLOSURE RESPONSIBILITIES UNDER FEDERAL SECURITIES LAWS AGENDA ACTION: STUDY SESSION
RECOMMENDATION
The Finance Department recommends that the Council receive information regarding the issuance of municipal bonds and training regarding the responsibilities of elected officials under federal securities laws. The training is provided in accordance with Council Policy 000-58, Statement of Debt Management and Disclosure Policy. The Council will not take action on this item but may discuss the information presented and provide direction to staff.
EXECUTIVE SUMMARY
The City anticipates presenting a request to the Council for approval of the issuance of wastewater revenue bonds (2026 Wastewater Revenue Bonds) to finance upgrades to the electrical infrastructure at the Laguna Treatment Plant and refinance outstanding wastewater revenue bonds. Council Policy 000-58, Statement of Debt Management and Disclosure Policy, requires periodic training regarding the City’s disclosure obligations under federal and state securities laws. NHA Advisors, LLC (NHA), the City’s municipal advisor; Jones Hall LLP, the City’s bond and disclosure counsel; and City staff have prepared a presentation providing general information about municipal bonds and training regarding the Council’s responsibilities under federal securities laws when it considers approval of the disclosure document for the 2026 Wastewater Revenue Bonds.
GOAL
This item relates to Council Goal #1 - Achieve and Maintain Budgeting Excellence and Fiscal Stability.
BACKGROUND/PRIOR COUNCIL REVIEW
If the City Council approves the issuance of the proposed 2026 Wastewater Revenue Bonds, a portion of the bond proceeds will finance the Laguna Treatment Plant Electrical Infrastructure Improvement Project. The project will upgrade electrical infrastructure at the Laguna Wastewater Treatment Plant, where much of the existing equipment has reached the end of its useful life and replacement parts are no longer manufactured or are difficult to obtain. Bond proceeds will also be used to refinance certain outstanding wastewater revenue bonds. The refinancing will allow other available moneys to be used to defease, or set aside sufficient funds to pay the remaining principal and interest on, additional outstanding wastewater revenue bonds. Staff expects to present the proposed bond issuance to the Council for consideration on October 27, 2026.
Council Policy 000-58, Statement of Debt Management and Disclosure Policy, requires the City's disclosure counsel to provide periodic disclosure training. The training includes education on the City's disclosure policies and its obligations under federal and state securities laws. The issuance and trading of municipal securities are subject to extensive federal and state regulation. The Securities and Exchange Commission (SEC) administers and enforces federal securities laws and oversees the Municipal Securities Rulemaking Board (MSRB), which establishes rules governing municipal securities dealers and municipal advisors. These laws and rules are intended to protect investors, promote fair and efficient markets, and support accurate and complete disclosure. The City must comply with these requirements throughout the life of each debt issuance, including maintaining records for the life of the debt plus three years.
The City has engaged NHA as its municipal advisor. Jones Hall LLP will serve as bond counsel and disclosure counsel for the proposed financing. Both firms have worked with the City for many years and maintain strong reputations throughout California.
ANALYSIS
The City of Santa Rosa has the authority to borrow money for public infrastructure projects through the municipal bond market. Municipal issuers often benefit from lower borrowing costs because investors generally receive tax-exempt interest on qualifying bonds. Staff anticipates returning to the Council on October 27, 2026, to request approval of the issuance of the 2026 Wastewater Revenue Bonds as tax-exempt revenue bonds.
FISCAL IMPACT
This study session does not have a fiscal impact on the General Fund or Wastewater Funds. The fiscal impacts associated with the proposed 2026 Wastewater Revenue Bonds will be analyzed when that item is presented to the Council for consideration.
ENVIRONMENTAL IMPACT
Pursuant to CEQA Guidelines Section 15378(b)(5), the recommended action is not a project subject to the California Environmental Quality Act (CEQA) because it consists of an administrative activity that will not result in a direct or reasonably foreseeable indirect physical change in the environment.
BOARD/COMMISSION/COMMITTEE REVIEW AND RECOMMENDATIONS
Not applicable.
NOTIFICATION
Not applicable.
ATTACHMENTS
Attachment 1 – Statement of Debt Management and Disclosure Policy
PRESENTER(S)
Scott Wagner, Chief Financial Officer
Chris Lynch, Jones Hall LLP
Craig Hill, NHA Advisors, LLC
ISSUANCE OF MUNICIPAL BONDS AND DISCLOSURE RESPONSIBILITIES UNDER FEDERAL SECURITIES LAWS PAGE 3 OF 3