professional, consistent with Section 5.28.260 and approved by both the Police Chief and Community Development Director.
b. Lighting Plan. A lighting plan showing existing and proposed exterior and interior lights that will provide adequate security lighting for the use.
5. Odor Control. A detailed ventilation plan describing the air treatment system, or other methods that will be implemented to prevent offensive odors generated from the manufacturing, testing and/or storage of qcode.us/codes/woodland/ 6/13
8/17/2021 Chapter 5.28 COMMERCIAL CANNABIS BUSINESS PERMITS cannabis from being detected outside the buildings on the site.
6. Business Operations.
a. Business Plan. A plan describing how the cannabis business will operate in accordance with this code, State law, and other applicable regulations. The business plan must include ownership and qualifications, budget, quality control, inventory control, plans for hours of operation, handling cash, and transporting cannabis and cannabis products to and from the business site, as may be applicable.
b. Community Benefit Plan. A plan describing the benefits the cannabis business has provided or will provide to the local community including direct aid, participation in, and commitment to funding the work of local non-profits, community, civic, or social service based organizations. The development of public outreach and education program related to risks of youth and drugs, and any other agreed upon community benefit between the City and applicant.
c. Social Policy and Local Enterprise Plan. A plan describing applicant’s plans for local outreach and hiring of residents of the City of Woodland for open positions and/or compensation for continuing education, and any other actions proposed by applicant that are intended to benefit the local workforce and/or applicant’s local employees. d. Community Relations and Neighborhood Compatibility Plan. A plan describing who is designated as being responsible for outreach and communication with the surrounding community, including the neighborhood and businesses, and how the designee can be contacted. The community relations plan must include a description of the community benefit the business will provide, or proposes to provide, to the surrounding community. The plan should additionally describe how the cannabis business will proactively address and respond to complaints from the surrounding community related to noise, light, odor, litter, vehicles and pedestrian traffic and any other activities that could become a nuisance or have impacts on the cannabis business’s neighbors and the surrounding community. e. State Licenses. Copies of the applicant’s State licenses relating to cannabis, as required by State law. If the applicant applies for a cannabis business permit prior to the State issuing the appropriate licenses, the applicant shall specify which State license(s) will be obtained once the State begins issuing licenses. f. Tax Compliance. A current copy of the applicant’s City business license tax certificate, State sales tax seller’s permit, and the applicant’s most recent year’s financial statement and tax returns, as may be applicable.
g. Insurance. The applicant’s certificate of commercial general liability insurance and endorsements and certificates of all other insurance related to the operation of the cannabis manufacturing business. h. Budget. A copy of the applicant’s most recent annual budget for operations. i. Price List. A list of the most recent prices for all products and services provided by the applicant, as may be applicable.
7. City Authorization. Authorization and consent for the Community Development Director to seek verification of the information contained within the application.
8. Applicant’s Certification. A statement dated and signed by the applicant, under penalty of perjury, that the applicant has personal knowledge of the information contained in the application, that the information contained therein is true and correct, and that the application has been completed under the applicant’s supervision.
9. Operating Agreement and Indemnification. The City and applicant shall enter into an operating agreement, in a form approved by the City Attorney, whereby the applicant:
a. Releases the City, and its agents, officers, elected officials, and employees from any and all claims, injuries, damages, or liabilities of any kind arising from: (i) any repeal or amendment of this chapter or any provision of the Zoning Ordinance relating to the cannabis business, and (ii) any arrest or prosecution of the applicant or its managers, employees, or members for violation of State or Federal laws; and
b. Defends, indemnifies, and holds harmless the City and its agents, officers, elected officials, and employees from and against any and all claims or actions: (i) brought by adjacent or nearby property owners or any other parties for any damages, injuries, or other liabilities of any kind arising from operations at the manufacturing site, and (ii) brought by any party for any problems, injuries, damages, or other liabilities of any kind arising out of the distribution of cannabis or cannabis products at the business site.
c. Agrees to abide by the requirements of this code and any other operating terms and conditions as mutually agreed by the parties to ensure that the social policy and local enterprise plan commitments and community benefits derived from the proposed cannabis business adequately address potential adverse impacts.
B. Every application for a cannabis business permit shall be accompanied by a nonrefundable cannabis business permit program fee.
C. No person shall knowingly make a false statement of fact or knowingly omit any information that is required in an application for a cannabis business permit. (Prior code § 13A-3-04)
5.28.190 Application process.
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8/17/2021 Chapter 5.28 COMMERCIAL CANNABIS BUSINESS PERMITS The Community Development Director, in consultation with the City Manager and Police Chief, is authorized to establish procedures and guidelines to process cannabis business permit applications. (Prior code § 13A-3-05)
5.28.200 Denial of a cannabis business permit.
A. The Community Development Director may deny a cannabis business permit if he or she determines that one or more of the following circumstances exist:
1. The application received is incomplete, filed late, or not responsive to the requirements of this article;
2. The application contains a false or misleading statement or omission of a material fact;
3. The operation of the business site described in the application fails to comply with any of the requirements in this code, State law, or any other regulation;
4. The applicant has not received a conditional use permit from the City for the corresponding cannabis business.
5. The applicant or any of its managers has any unpaid and overdue administrative penalties imposed for violations of this chapter;
6. Within 12 months of the date of application, either the applicant has had a State or local cannabis-related land use or business permit revoked; or any of its managers were associated with a cannabis business that had its cannabis-related permit(s) revoked;
7. The applicant was notified that it was conducting commercial cannabis activity in violation of this chapter and any other city of Woodland ordinances, codes and requirements, and failed to cure the violation in a timely manner;
8.The applicant is delinquent in payment of federal, state or local taxes and/or fees, and took no steps to cure the delinquency when notified by the appropriate agencies; or
9. Operation of the proposed cannabis business site, as represented in the application, is a threat to the public health, safety, or welfare.
B. The denial of a cannabis business permit is subject to and shall comply with Article 2 of this chapter. (Prior code § 13A-3-06)
5.28.210 Terms of cannabis business permit.
A. A cannabis business permit issued pursuant to this article is valid for one year from the date that the permit is issued, unless suspended or revoked sooner.
B. A cannabis business permit is only valid for the operator of the cannabis business(es) identified on the cannabis business permit for that particular cannabis business site. In the event of multiple operators located on a single cannabis business site, each operator shall obtain and maintain a separate cannabis business permit to operate the operator’s cannabis business(es).
C. A cannabis business permittee shall not allow cannabis or cannabis products on the business site to be visible from the public right-of-way, the unsecured areas surrounding the building(s) on the site, or the site’s main entrance and lobby.
D. The permittee shall notify the Community Development Director of any change in the information provided on the application to obtain the cannabis business permit within 30 days of the change.
E. Conditions placed on the conditional use permit issued under Chapter 17.132 of this code are also conditions of the cannabis business permit. Any violation of the conditions of the conditional use permit is grounds for suspending or revoking the cannabis business permit.
F. The Community Development Director may impose additional conditions on the cannabis business permit, including the maximum amount of cannabis and cannabis products allowed on the site, number and types of equipment allowed, and security features. (Prior code § 13A-3-07)
5.28.220 Renewal.
A. A permittee may apply for a cannabis business permit renewal by submitting to the Community Development Director at least 30 calendar days before the expiration of the permit, a renewal application and a non-refundable renewal fee in an amount set by resolution of the City Council. Failure to timely submit a renewal application prior to expiration of the permit shall result in permit expiration, and an application for a new permit shall be required pursuant to Section 5.28.180.
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8/17/2021 Chapter 5.28 COMMERCIAL CANNABIS BUSINESS PERMITS B. If a timely and complete application for renewal is filed, the permit’s expiration shall be stayed until a decision on the renewal application is issued.
C. The Community Development Director shall either approve or deny the renewal of a permit within 30 calendar days of receipt of the complete application. The Community Development Director may extend the time for consideration of the application for up to an additional 30 calendar days upon written notice to the applicant. The failure of the Community Development Director to timely act shall constitute approval of the renewal of the permit.
D. The Community Development Director shall approve the renewal of a permit if he or she finds that the circumstances existing during the term of the permit and during the review period of the application for renewal are consistent with all of the findings required for approval of a new permit specified in Section 5.28.180, and that no permittee or interested party of the cannabis business has committed, permitted, or failed to prevent violations of the municipal code, or any license or permit condition, during the preceding permit term.
E. Notwithstanding an approval for a permit renewal, the Police Chief may add, delete or modify the permit conditions using the criteria set forth in Section 5.28.210.
F. A permit renewed pursuant to this section may be extended for up to two additional years.
G. The renewal application shall be on a form approved by the Community Development Director. The Community Development Director, in consultation with the City Manager and Police Chief, is authorized to establish procedures and guidelines to process cannabis business permit renewal applications. (Prior code § 13A- 3-08)
5.28.230 Suspending, modifying, or revoking a permit.
A. The Community Development Director may suspend, modify, or revoke a cannabis business permit issued pursuant to the provisions of this article for any of the following reasons:
1. One or more of the circumstances upon which a cannabis business permit could be denied, as described in Section 5.28.200, exists or has occurred;
2. One or more conditions of the cannabis business permit has been violated; or
3. The permittee, its managers or interested parties have violated any provision of this chapter.
B. The suspension, modification, or revocation of a cannabis business permit shall comply with Article 2 of this chapter. (Prior code § 13A-3-09)
5.28.240 Emergency contact manager.
A cannabis business permittee shall provide the Community Development Director with the current name and primary and secondary telephone numbers of at least one 24-hour on-call manager to address and resolve complaints and to respond to emergency operating problems or concerns associated with the cannabis business. (Prior code § 13A-3-10) Article 4. Operating Requirements
5.28.250 Cannabis business site buildings.
A cannabis business site shall comply with the following requirements:
A. Entrances. All entrances into the buildings on the business site shall be locked at all times with entry controlled by the cannabis business permittee’s managers and staff.
B. Main Entrance and Lobby. The business site shall have a building with a main entrance that is clearly visible from the public street or sidewalk. Inside of the main entrance, there shall be a lobby to receive persons into the site and to verify whether they are allowed in the cultivation, manufacturing, testing, distribution and/or retail storage areas.
C. All cultivation, manufacturing, testing, distribution and/or retail storage areas in any building on the business site shall be separated from the main entrance and lobby, and shall be secured by a lock accessible only to managers and staff of the cannabis business permittee.
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8/17/2021 Chapter 5.28 COMMERCIAL CANNABIS BUSINESS PERMITS D. Transport Area. Each building shall have an area designed for the secure transfer of cannabis from a vehicle to the secured business area(s), as applicable. If the business will conduct sales by delivery, each building shall have an area designed for the secure transfer of cannabis from the business to the delivery vehicle. Delivery drivers shall be accompanied by a security escort during the transfer of cannabis from the business to the delivery vehicle.
E. Storage Area. Each building that will be used for storing cannabis or cannabis products shall have adequate storage space separated from the main entrance and lobby, and shall be secured by a lock accessible only to managers and staff of the cannabis manufacturing permittee. (Prior code § 13A-4-01)
5.28.260 Cannabis business site security.
A cannabis business site shall comply with the following security requirements:
A. A cannabis business permittee shall comply with the security plan that is approved by Community Development Director and Police Chief, which plan may shall include sufficient security measures to deter and prevent the unauthorized entrance into areas containing cannabis or cannabis products, and to deter and prevent the theft of cannabis or cannabis products at the commercial cannabis business building specifications, lighting, alarms, and State-licensed security personnel.
B. Each security plan approved by the Community Development Director and Police Chief must include, but is not limited to, the following:
1. Security Surveillance Cameras System. Security surveillance cameras of at least HD quality and a video recording system must be professionally installed to monitor all doors into the buildings on the manufacturing business site, the parking lot, loading areas, interior spaces where cannabis, cash or currency is being stored for any period of time on a regular basis and all interior spaces where diversion of cannabis could reasonably occur and all exterior sides of the property adjacent to the public rights-of-way in a manner that protects the inventory, facility and employees. The cameras and recording system must be of adequate quality, color rendition, and resolution to allow the identification of any individual present on the manufacturing site All cameras shall record in color, and all exterior cameras shall be in weather-proof enclosures, shall be located so as to minimize the possibility of vandalism, and shall have the capability to automatically switch to black and white in low light conditions. The recording system must be capable of exporting the recorded video in standard MPEG formats to another common medium, such as a DVD or USB drive. The business shall have network security protocols that are certified by Underwriters Laboratories.
2. Security Video Recording and Retention. The cannabis business permittee shall be responsible for ensuring that the security surveillance cameras’ footage is remotely accessible by the Police Department or its designee on a real-time, live access basis, and the cannabis business shall provide such internet protocol address information to facilitate such remote access. Video shall be of sufficient quality for effective prosecution of any crime found to have occurred on the site of the cannabis business and shall be capable of enlargement via projection or other means. Video from the security surveillance cameras must be recording at all times (24 hours a day, seven days a week) and the recording shall be maintained for at least 30 days. The video recordings shall be made available to the City upon request.
3. Alarm System. Professionally and centrally-monitored fire, robbery, and burglar alarm systems must be installed by a security company license by the State of California Bureau of Security and Investigative Services and maintained in good working condition. The alarm system must include a private security company that is required to respond to every alarm.
4. Locking of Access Doors. All entrance areas to the cannabis business shall be locked at all times and under the control of a designated responsible party that is either (i) an employee of the cannabis business or (ii) a licensed security professional. Further all cannabis businesses shall have the capability to remain secure during a power outage and shall ensure that all access doors are not solely controlled by an electronic access panel to ensure that locks are not released during a power outage.
5. Sensors. Sensors shall be installed to detect entry and exit from all secure areas and shall be monitored on a real-time basis by a security company licensed by the State of California Bureau of Security and Investigative Services.
6. Panic Buttons. Panic buttons shall be installed in all cannabis businesses in locations as approved by the Police Chief or his/her designee with direct notification to the Woodland Police Department dispatch
7. Perimeter Lighting. Perimeter security and lighting systems (including motion sensors) for after- hours security as approved by the Police Chief and Community Development Director or their respective designees.
8. Security of Cannabis and Cannabis Products. Except for live growing plants which are being cultivated at a cultivation operation, all cannabis and cannabis products shall be stored in a secured and locked vault or vault equivalent. All safes and vaults shall be compliant with Underwriters Laboratories burglary-resistant and fire-resistant standards. All cannabis and cannabis products, including live plants that are being cultivated, shall be kept in a manner as to prevent diversion, theft, and loss.
9. Limited Access Areas. Areas where cannabis, cash or currency is being stored for any period of time on a regular basis shall only be accessible to authorized cannabis business personnel.
10. A requirement prohibiting individuals from remaining on the premises of the cannabis if they are not engaging in any activity directly related to the permitted operations of the cannabis business.
11. Security Personnel. Security personnel shall be on site twenty-four hours a day or alternative security as authorized by the Police Chief or his/her designee(s), and must have a verified response security patrol when closed. A minimum staffing level of security guards shall be set by the Police Chief or his/her designee(s) and reviewed annually. Security personnel must be licensed by the state of California Bureau of Security and Investigative Services personnel and shall be subject to the prior review and approval of the Police Chief or his/her designee(s), with such approval not to be unreasonably withheld. Firearms may be carried by security personnel while they are on duty only if authorized by the Police Chief.
12. A permittee shall report to the City Police Department all criminal activity occurring on the business site. (Prior code § 13A-4-02)
5.28.270 Cannabis employee requirements and cannabis work permit.
A. All cannabis businesses must ensure that their employee and any other persons who work within the business comply with the following as a condition of the cannabis business permit:
1. All employees or persons who otherwise works within a commercial cannabis business must be legally authorized to do so under applicable state law.
2. Cannabis businesses shall be required to provide the Police Chief with evidence of the completion of a criminal background check for all persons in their employment that, at a minimum, identifies the following:
i. Whether the individual applying for employment has ever been convicted of a violent felony as defined by California Penal Code Section 667.5, or equivalent offenses in other states; ii. Whether the individual applying for employment has ever been convicted of a crime involving dishonesty, fraud or deceit, including but not limited to fraud, forgery, theft, or embezzlement as those offenses are defined in California Penal Code Sections 186.11, 470, 484, and 504a, respectively; or equivalent offenses in other states;
iii. Whether the individual applying for employment has ever been convicted of the illegal use, possession, transportation, distribution or similar activities related to controlled substances, as defined in the Federal Controlled Substances Act, not including cannabis-related offenses for which the conviction occurred after the passage of the Compassionate Use Act of 1996.
3. Evidence of a conviction of any the offenses enumerated in subsection (A)(2) of this section shall be grounds for denial of employment. Employers who wish to hire an individual notwithstanding this restriction shall apply to the Police Chief, who at his/her sole discretion may issue a written waiver.
4. Violation of the requirements under this subsection (A) shall be grounds for immediate suspension of the business permit, pending a hearing on revocation of the business permit in accordance with Article 2 of this Chapter.
B. All employees of a cannabis business must additionally hold and maintain a current cannabis work permit that is issued by the Police Department in accordance with this subsection (B) prior to and as a condition of maintaining employment with a cannabis business:
1. The initial application shall be submitted on forms supplied by the police department and shall include, but not be limited to, the true name, address and description of the applicant, the name and address of the applicant’s employer and the position the applicant holds. The application shall be accompanied by the fingerprints of the applicant in cases where the applicant’s fingerprints are not already on file at the police department. Each application for a cannabis work permit shall be accompanied by a nonrefundable fee in an amount established by resolution of the city council plus any applicable processing or administrative fees established by other federal or state agencies.
2. The Police Chief or his/her designee may deny to such applicant a work permit if the applicant has been convicted of a felony or any crime enumerated in Section 5.28.270(A). Furthermore, the Police Chief or his/her designee may deny such permit if, based upon investigation into the background of the applicant, the Police Chief or his/her designee determines that the applicant has deliberately given false answers to questions contained in the application submitted. No person shall work in a cannabis business in the city and no cannabis business shall employ any person after the Police Chief or his/her designee has denied his or her application for a work permit. Any work permit issued hereunder shall expire one year from the date of issuance.
3. Any person whose application for a work permit pursuant to this section has been denied may appeal that determination to the City Manager. Written notice of such appeal shall be filed with the city clerk no later than ten days after the denial of the permit. The appeal shall include a statement of the grounds of the appeal. The City Manager shall thereafter hear the appeal and affirm, modify or overrule the determination appealed. Upon failure to file the notice of appeal within such ten-day period, the denial shall be final and conclusive.
4. Not less than thirty days prior to the expiration date of a currently valid cannabis work permit, the permittee shall apply for the renewal of said permit. Renewal is not automatic. The application shall be accompanied by a nonrefundable fee in an amount established by resolution of the city council.
The Police Chief or his/her designee may grant such renewal provided it finds that all facts set forth in the renewal application are substantially the same as on the original application and the permittee has not violated any provisions of this chapter, or the Police Chief or his/her designee may deny such renewal pursuant to the process set forth in this Subsection (B).
5. The cannabis work permit shall be issued by the police department as a laminated or plastic-coated identification badge which shall be displayed by the cannabis business employee at all times while working at a cannabis business.
5.28.2870 Display of cannabis business permit.
The cannabis business permittee shall display its current valid cannabis business permit issued in accordance with this article inside the lobby or waiting area of the main entrance to the business. The permit shall be displayed at all times in a conspicuous place so that it may be readily seen by all persons entering the business site. (Prior code § 13A-4-03)
5.28.2980 Signs (Non-Retail Cannabis Businesses).
C. A non-retail cannabis business permittee shall post in the lobby of the business site signs that state the following:
1. “This site is not open to the public.”
2. “On-site retail sales of any goods and services is prohibited.”
3. “Juveniles are prohibited from entering this site.”
4. “Smoking, ingesting, or consuming cannabis on this site is prohibited.” D. Each sign described in subsection A must be at least eight inches by 10 inches in size and must be displayed at all times in a conspicuous place so that it may be readily seen by all persons entering the business site. (Prior code § 13A-4-04)
5.28.30290 Site restricted (Non-Retail Cannabis Businesses).
A. No non-retail cannabis business permittee shall open his or her cannabis business site to the general public.
B. No non-retail cannabis business permittee shall allow anyone on the cannabis business site, except for managers, staff, and other persons with a bona fide business or regulatory purpose for being there, such as City officials, contractors, inspectors, and cannabis transporters. qcode.us/codes/woodland/ 10/13
8/17/2021 Chapter 5.28 COMMERCIAL CANNABIS BUSINESS PERMITS C. A manager must be on the non-retail cannabis business site at all times that any other person, except for security guards, is on the site.
D. Any person other than managers or staff who are on the non-retail cannabis business site must sign in, wear a visitor badge, and be escorted on the site by a manager at all times. (Prior code § 13A-4-05)
5.28.3100 Juveniles prohibited.
A. No juvenile shall be on the cannabis business site or operate a cannabis business in any capacity, including, but not limited to, as a manager, staff, employee, contractor, or volunteer.
B. No permittee shall allow any violation of subsection A. (Prior code § 13A-4-06)
5.28.3210 Cannabis consumption prohibited.
No person, including managers, employees and visitors, shall smoke, ingest, or otherwise consume cannabis in any form on or within the cannabis business site. (Prior code § 13A-4-07)
5.28.3320 Alcohol prohibited.
No person shall possess, consume, or store any alcoholic beverage on the cannabis business site. (Prior code § 13A-4-08)
5.28.3430 Maintenance of records.
A. A cannabis business shall maintain the following records in printed format for at least three years on the business site and shall produce them to the City within 24 hours after receipt of the City’s request:
1. The name, address, and telephone numbers of the owner and landlord of the property.
2. The name, date of birth, address, and telephone number of each manager and staff of the cannabis business; the date each was hired; and the nature of each manager’s and staff’s participation in the cannabis business.
3. A written accounting of all income and expenditures of the cannabis business, including, but not limited to, cash and in-kind transactions.
4. A copy of the cannabis business’s commercial general liability insurance policy and all other insurance policies related to the operation of the business.
5. A copy of the cannabis business’s most recent year’s financial statement and tax return.
6. An inventory record documenting the dates and amounts of cannabis and cannabis products received at the business site, the daily amounts of cannabis and cannabis products stored on the site, and the daily amounts of cannabis and cannabis products transported from the site.
B. Each cannabis business shall have an accounting software system in place to provide point of sale data as well as audit trails for both product and cash, where applicable.
C. Each cannabis business shall demonstrate to the chief of police, city manager or their designees compliance with the state’s track and trace system for cannabis and cannabis products, as soon as it is operational.
D. A cannabis business shall report any loss, damage, or destruction of these records to the City Manager within 24 hours of the loss, damage, or destruction. (Prior code § 13A-4-09)
5.28.3540 Site management.
A. The cannabis business permittee shall prevent and eliminate conditions on the cannabis business site that constitute a nuisance.
B. The permittee shall properly store and dispose of all waste generated on the cannabis business site, including chemical and organic waste, in accordance with all applicable laws and regulations. (Prior code § 13A-4-10)
5.28.3650 Retail cannabis business operating requirements.
A retail cannabis business shall, at a minimum, comply with the following operating requirements as conditions of their permit:
A.The maximum hours of operation shall be daily from nine a.m. to nine p.m., unless the City imposes more restrictive hours as a condition of the permit. A retail cannabis business conducting sales by deliveries shall not conduct any deliveries outside the applicable hours of operation of the business.
B.Retail customers shall only be permitted in designated retail customer areas of the cannabis business.
Retail customer areas are those areas where limited quantities of cannabis and cannabis goods are sold and displayed for purchase. The retail cannabis business shall verify that persons entering the retail customer areas are authorized to purchase cannabis. Authorized retail customers mean the following:
(1)For a retail cannabis business authorized to sell medical cannabis, an “authorized retail customer” means a medical cannabis patient who is at least eighteen years old and possesses a physician’s recommendation in accordance with the Compassionate Use Act of 1996, Health and Safety Code Section 11362.5 et seq. Medical cannabis patients under the age of 18 shall be accompanied by a parent, legal guardian, or primary caregiver. Medical cannabis patients shall provide proof of a valid physician’s recommendation and valid proof of identification. (2)For a retail cannabis business authorized to sell adult-use cannabis, an “authorized retail customer” means an individual that is at least twenty-one years of age. Every retail customer shall provide valid proof of identification demonstrating the age of the individual.
C.A retail cannabis business shall not allow or permit any person to smoke or ingest cannabis or cannabis products on the business site.
D.Other than retail customer areas, all other areas of the retail cannabis business shall be limited access areas restricted to managers, staff, and other persons with a bona fide business or regulatory purpose for being there, such as city officials, contractors, inspectors, and cannabis transporters.
E.The retail cannabis business shall prohibit loitering by persons outside the establishment, either on the premises or within fifty feet of the premises.
F.A manager must be on the cannabis business site at all times that any other person, except for security guards, is on the site. For purposes of this section, a “manager” shall mean and include the retail cannabis business permittee, owner, proprietor, manager, assistant manager, or other person exercising control over the operation of the cannabis business.
G.Employees of the retail cannabis business shall not smoke or consume cannabis or cannabis products on the business premises.
H.A retail cannabis business shall comply with all signage, packaging, labeling, and advertising requirements imposed by state law.
5.28.3760 Cannabis delivery services originating in city.
If a retail cannabis business in the city conducts any retail sales by delivery, the retail cannabis business shall comply with the following additional requirements as conditions of their permit as part of the retail cannabis business permit:
A.The delivery services shall be conducted by employees of the retail cannabis business who are at least twenty- one years old. The retail cannabis business shall not use the services of an independent contractor or courier service to deliver cannabis for retail sale.
B.Every employee of the retail cannabis business engaging in delivery services shall maintain on his or her person a physical copy of the following when conducting a delivery:
(1)The business’s current valid retail cannabis business permit; (2)Valid driver’s license;
(3)Employer-provided badge containing the name and photo of the employee; and (4)Each customer’s delivery request. The delivery request must identify the retail cannabis business, the customer’s name and address, and the product(s) being delivered.
C.Cannabis may only be delivered in-person to the customer that made the delivery request, and shall not be left unattended or delivered to any other person. The delivery-employee shall verify the customer’s age, identity, delivery request, and, if applicable, valid physician’s recommendation prior to completing the delivery.
D.Cannabis may not be delivered to an address located on publicly-owned land or any address on land or in a building leased by a public agency.
E.All deliveries shall be conducted in an enclosed motor vehicle or other acceptable delivery method in compliance with state law, operated by the delivery employee or another delivery employee of the retail cannabis business.
F.Cannabis and cannabis products shall not be left unattended in a vehicle, except for brief periods as necessary to deliver cannabis to a customer. If cannabis and cannabis products are left unattended in a vehicle, the vehicle must remain locked and must be equipped with an active vehicle alarm system.
G.For purposes of this section, a delivery begins when an employee leaves the retail cannabis business premises with cannabis intended for delivery, and ends when the delivery employee returns to the retail cannabis business premises. When conducting deliveries, the employee shall only travel from the business premises to a delivery address, from one delivery address to another delivery address, or from a delivery address back to the business premises.
H.The police chief is authorized to establish permitted and preferred delivery routes applicable to retail cannabis businesses.
I.These regulations are intended to be the minimum requirements imposed by law, and shall not be construed to conflict with state law. Where state law provides more restrictive requirements for cannabis deliveries, state law controls.
Article 5. Outside Cannabis Delivery Service Permits
5.28.38650 Cannabis delivery services originating outside of the City.
A. For purposes of this section, “outside cannabis delivery service” means a cannabis business located outside of the City that delivers cannabis or cannabis products to a physical location in the City as part of a retail sale.
B. .This article does not apply to a retail cannabis business located and permitted in the city pursuant to Article 3 of this Chapter, in which proposed delivery services shall be included in the application for retail cannabis uses..
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8/17/2021 Chapter 5.28 COMMERCIAL CANNABIS BUSINESS PERMITS C. No person shall perform an outside cannabis delivery service in the City without first obtaining a valid business license issued by the City, and a cannabis delivery permit issued pursuant to this section.
D.The Cannabis outside delivery permit fee is hereby established and imposed. The City Council shall establish by resolution the amount of the outside cannabis delivery permit fee.
E.An application for an outside cannabis delivery permit shall be submitted to the Community Development Director, on a form approved by the Community Development Director. The application shall contain the following minimum information:
1. A description of the statutory entity or business form that serves as the legal structure for the outside cannabis delivery service and a copy of its formation and organizing documents, including, but not limited to, articles of incorporation, statement of information, articles of association, and fictitious business name statement.
2. The phone number and address to which notice of action on the application and correspondence is to be mailed.
3. The name, address, telephone number, title, and function of each of the outside cannabis delivery service’s owners and managers.
4. The name, address, telephone number, and title of each of the employees that are authorized to perform deliveries from the cannabis business. For each employee authorized to perform deliveries, proof of valid driver’s license and current employment by the business is required.
5. A general description of the retail cannabis business site, including the street address, parcel number, and hours of operation, from which the outside cannabis delivery service operates. The business description should indicate whether the business intends to sell medical or adult-use cannabis.
6. Copies of the applicant’s State license(s) relating to cannabis, as required by State law. If the applicant applies for an outside cannabis delivery permit prior to the State issuing the appropriate licenses, the applicant shall specify which State license(s) will be obtained once the State begins issuing licenses.
7. The cannabis business’s certificate of commercial general liability insurance and endorsements and certificates of all other insurance related to the operation of the cannabis retail business and deliveries.
8. Applicant’s Certification. A statement dated and signed by the applicant, under penalty of perjury, that the applicant has personal knowledge of the information contained in the application, that the information contained therein is true and correct, and that the application has been completed under the applicant’s supervision
9. Indemnification. An agreement, on a form approved by the City Attorney, whereby the applicant:
a. Releases the City, and its agents, officers, elected officials, and employees from any and all claims, injuries, damages, or liabilities of any kind arising from: (i) any repeal or amendment of this chapter, and (ii) any arrest or prosecution of the applicant or its managers, employees, or members for violation of State or Federal laws; and
b. Defends, indemnifies, and holds harmless the City and its agents, officers, elected officials, and employees from and against any and all claims or actions: (i) brought by City property owners or any other parties for any damages, injuries, or other liabilities of any kind arising from the business delivery operations, and (ii) brought by any party for any problems, injuries, damages, or other liabilities of any kind arising out of the distribution of cannabis or cannabis products from the business site in the City.
10. Every application for an outside cannabis delivery permit shall be accompanied by a nonrefundable outside cannabis delivery permit fee.
11. No person shall knowingly make a false statement of fact or knowingly omit any information that is required in an application for an outside cannabis delivery permit.
C. An outside cannabis delivery permit shall be valid for a term of one year from the date that the permit is issued, unless suspended or revoked sooner. A permittee may apply for an outside cannabis delivery permit renewal at least 30 days before the expiration of the permit on a form approved by the Community Development Director.
D. An outside cannabis delivery permit may be denied, revoked, or suspended if one or more of the following circumstances exist:
1. The application received is incomplete or not responsive to the requirements of this section;
2. The application contains a false or misleading statement or omission of a material fact; qcode.us/codes/woodland/ 12/13
8/17/2021 Chapter 5.28 COMMERCIAL CANNABIS BUSINESS PERMITS
3. The operation of the delivery service described in the application fails to comply with any of the requirements in this code, State law, or any other regulation; or
4. The applicant or any of its managers has any unpaid and overdue administrative penalties imposed for violations of this chapter.
F. Denial, suspension, and revocation of a cannabis delivery permit is subject to the appeal procedures set forth in Article 2 of this chapter.
G. Deliveries of cannabis and cannabis products within the City shall comply with the following requirements:
1. The delivery services shall be conducted by employees of the retail cannabis business who are at least 21 years old. The retail cannabis business shall not use the services of an independent contractor or courier service to deliver cannabis for retail sale.
2. Every employee of the retail cannabis business engaging in delivery services shall maintain on his or her person a physical copy of the following when conducting a delivery:
a. The business’s current valid retail cannabis business permit; b. Valid driver’s license;
c. Employer-provided badge containing the name and photo of the employee; and d. Each customer’s delivery request. The delivery request must identify the retail cannabis business, the customer’s name and address, and the product(s) being delivered.
3. Cannabis may only be delivered in-person to the customer that made the delivery request, and shall not be left unattended or delivered to any other person. The delivery-employee shall verify the customer’s age, identity, delivery request, and, if applicable, valid physician’s recommendation prior to completing the delivery.
4. Cannabis may not be delivered to an address located on publicly-owned land or any address on land or in a building leased by a public agency.
5. All deliveries shall be conducted in an enclosed motor vehicle or other acceptable delivery method in compliance with State law, operated by the delivery employee or another delivery employee of the retail cannabis business.
6. Cannabis and cannabis products shall not be left unattended in a vehicle, except for brief periods as necessary to deliver cannabis to a customer. If cannabis and cannabis products are left unattended in a vehicle, the vehicle must remain locked and must be equipped with an active vehicle alarm system.
7. For purposes of this section, a delivery begins when an employee leaves the retail cannabis business premises with cannabis intended for delivery, and ends when the delivery employee returns to the retail cannabis business premises. When conducting deliveries, the employee shall only travel from the business premises to a delivery address, from one delivery address to another delivery address, or from a delivery address back to the business premises.
8. The Community Development Director is authorized to establish permitted and preferred delivery routes applicable to retail cannabis businesses.
9. These regulations are intended to be the minimum requirements imposed by law, and shall not be construed to conflict with State law. Where State law provides more restrictive requirements for cannabis deliveries, State law controls.
10. A cannabis delivery service is prohibited from conducting cash transactions at the time of delivery in the City. (Prior code § 13A-4-11)
View the mobile version.
qcode.us/codes/woodland/ 13/13
RESOLUTION NO. _____
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WOODLAND
APPROVING REVISED REGULATORY PERMIT FEES RELATED TO
COMMERCIAL CANNABIS BUSINESSES AND CONTRACT AMENDMENT WITH
HDL COMPANIES
WHEREAS, on December 5, 2017 the City Council adopted Ordinances Nos. 1629 and 1630 amending the Municipal Code to allow for limited commercial cannabis operations within the City of Woodland, subject to both zoning and regulatory requirements, as specified; and WHEREAS, on December 19, 2017 the City Council established Commercial Cannabis Permit fees intended to fully recover staff costs associated with administering and enforcing the City’s Commercial Cannabis Program.
WHEREAS, on May 19, 2020 the City Council approved a reduction in Commercial Cannabis renewal license fees
WHEREAS, staff is recommending commercial cannabis retail business permit fees for new permits and annual renewal of permits for this new cannabis business category; WHEREAS, staff is recommending annual Consumer Price Index (CPI) adjustments to new and renewal license fees;
WHEREAS, the State of California provides that regulatory fees and services may recover costs associated with such services; and
WHEREAS, the Commercial Cannabis Business License Fees are intended to cover anticipated costs associated with training, public outreach, business inspections, code compliance, financial reporting and audit functions; and
WHEREAS, in March 2021 the City entered into a contact agreement with HdL Companies for financial audits of cannabis business for one year
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF WOODLAND HEREBY RESOLVES:
Section 1. That the City Council hereby approve and adopt the proposed new and annual renewal cannabis business permit fees for commercial cannabis retail uses as set forth in the staff
report dated May 17, 2022 and accompanying this resolution and shall include both new business permit fees and annual renewal fees for such licenses in the City’s Comprehensive Fee Schedule.
Section 2. That the City Council hereby approves and adopts an amendment to both the new and annual renewal Cannabis Business Permit Fees in all categories to provide that said fees shall be updated annually on July 1 st of each year to reflect the changes in the Consumer Price Index (CPI-U), San Francisco Area over the preceding twelve (12) months. CPI-U shall be added on July 1, 2023.
Section 3. That the City Council hereby approves a contract amendment of $90,000 or $30,000 per year extending the current agreement for an additional three year for a total contract amount of $118,500.
PASSED AND ADOPTED by the City Council of the City of Woodland at a regular meeting of the City Council held on the 17th day of May 2022, by the following votes:
AYES:
NOES:
ABSENT:
ABSTAIN:
_________________________
Mayra Vega, Mayor
ATTEST:
________________________
Ana B. Gonzalez, City Clerk APPROVED AS TO FORM __________________________
Ethan Walsh, City Attorney
PIONEERAVE
N EAST ST
BEAMER ST
MAIN ST
KENTUCKY
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COUNTYROAD
102
COUNTYROAD
102
N WEST ST
WEST ST
WEST ST
GIBSON RDWGIBSONRD
COURT ST
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E BEAMER ST E BEAMER ST
W MAIN
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WKENTUCKYAVE
EAST ST
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E MAIN ST E MAIN ST
E KENTUCKY AVE E KENTUCKY AVE
N PIONEER AVE
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COUNTY ROAD 98
COUNTY ROAD 98
COUNTY ROAD 102
BOURN
DR
INDUSTRIALWAY
THIRD ST
NORTH ST
MATMOR
RD
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ASHLEYAVE
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COTTONWOOD ST
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ST
CROSS ST
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COLLEGEST
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COLLEGEST
COLOMAWAY
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HARRY LORENZO AVE
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FARMERS CENTRAL RD
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CANNERY
RD
|ÿ113
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Must
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§¨¦
5 §¨¦
5 §¨¦
5 0 0.25 0.50.13
Miles
SENSITIVE LOCATION
600 FT BUFFER
CANNABIS RETAIL ZONES
DOWNTOWN SPECIFIC PLAN - DISTRICT A
COMMUNITY COMMERCIAL
CORRIDOR MIXED USE - EAST ST
CORRIDOR MIXED USE - EAST ST/LIGHT INDUSTRIAL FLEX
CORRIDOR MIXED USE - KENTUCKY AVE
CORRIDOR MIXED USE - KENTUCKY AVE/LIGHT INDUSTRIAL FLEX
CORRIDOR MIXED USE - WEST MAIN
REGIONAL COMMERCIAL LIGHT INDUSTRIAL FLEX
TO: THE HONORABLE MAYOR AND CITY COUNCIL
AGENDA: City Council Regular Meeting
DATE: November 16, 2021
ITEM #: I.16
SUBJECT: Consideration of an Amendment to Chapter 17.110 of the City’s Zoning Ordinance related to Commercial Cannabis Retail Use in the City of Woodland and an Amendment to Chapter 5.28 of the Municipal Code related to Cannabis Business Permits
Recommendation for Action: Staff recommends that the City Council:
1. Receive a Report;
2. Conduct a public hearing;
3. Find that neither of these Ordinances constitute a project subject to California Environmental Quality Act (CEQA) review pursuant to Section 15061 (b) (3) of Title 14 of the California Code of Regulations as set forth in this Ordinance;
4. Introduce and waive the first reading of Ordinance No___, to amend Chapter 17.110 of the City of the Woodland Zoning Code, Exhibit B of the Interim Zoning Code, and Table 8.1 of the Downtown Specific Plan;
5. Introduce and waive the first reading of Ordinance No. ___, to amend Chapter 5.28 of the City of Woodland Municipal Code related to Cannabis Business Permits; and
5. Adopt Resolution No _______ to update Regulatory Permit Fees related to cannabis businesses.
6. Provide input and recommendation concerning the conditional use permit application evaluation process.
Staff Contact:
Cindy Norris, Principal Planner (530) 661-5911, [email protected]
Fiscal Impact:
The Ordinance development costs have been funded through a developer deposit account by the commercial cannabis retailer that originally approached the City with this inquiry, Perfect Union. Depending on final implementation of a Retail Cannabis Program by the City Council, there is potential for realized revenue through negotiated operating agreements and/or development agreements with applicants that receive Conditional Use Permits. The proposed fees are intended to fully recover staff costs associated with administering and enforcing the City's Commercial Cannabis Program. Total revenue to be generated by the proposed fees will depend entirely upon the number of Commercial Cannabis Business Permits issued by the City, limited by the caps imposed on the number of Conditional Use Permits established by the City Council.
Report in Brief:
This report presents the proposed Zoning Ordinance amendments to Chapter 17.110 of the City of Woodland Municipal Code, to the Interim Zoning Code, and to the Downtown Specific Plan to provide regulations allowing consideration for commercial cannabis retail activities in the City of Woodland.
The proposed zoning amendments have been prepared to allow commercial cannabis retail uses subject to the granting of a limited number of conditional use permits. The City currently allows up to six commercial cannabis conditional use permits in the industrial districts for cannabis manufacturing, distribution, and testing.
The proposed amendments will allow up to four commercial cannabis retail permits for storefront sales as conditional uses, and establish standards for the review and approval of retail cannabis uses. Delivery only uses are not be permitted within the City. Retail sales would be allowed for consideration in several commercial districts including Corridor Mixed Use districts (West Main, East Main, East Street, Kentucky), Community Commercial, Regional Commercial Light Industrial Flex, and in the Downtown Specific Plan District A.
Cannabis retail sales are not proposed in the industrial districts.
The report also presents proposed amendments to Chapter 5.28 of the City of Woodland Municipal Code regarding Cannabis Business Permits and updates to the regulatory permit fees related to cannabis businesses.
The Council is also asked to weigh in and provide input regarding future cannabis retail conditional use permit application processing and review.
Background:
On December 5, 2017, the Woodland City Council approved the regulatory framework to allow cannabis uses including land use zoning regulations, business permit requirements, fees for cost recovery, and review process.
Ordinance 1629 added provisions (Section 17.110) related to the Zoning of commercial cannabis to allow consideration of cannabis manufacturing, distribution, and testing uses in the Industrial and Industrial Light Industrial Flex Overlay districts. Ordinance 1630 added a new chapter to the Municipal Code (Section 5.28) for commercial cannabis business permits which address the regulatory and operational regulations for cannabis businesses. Resolution 6982 approved regulatory permit fees for commercial cannabis. All cannabis conditional use permits (CUP) require review and recommendation from the Planning Commission with final action by the City Council.
Section 17.110.050 of the Woodland Zoning Ordinance allows for consideration of up to six (6) conditional use permits (CUPs) for commercial cannabis manufacturing, distribution and testing facilities, which may be located in the Industrial and Industrial/Light Industrial Flex Zones. A CUP may cover a single individual location with one use, or a CUP may include approval for multiple uses collocated at one site through a master conditional use permit. To date, four of the six allowed CUPs have been approved. Three of the approved CUP locations are currently operated by commercial cannabis uses (2 manufacturing uses and 1 distribution use). A fourth master CUP was approved, allowing for manufacturing, distribution and testing collocated at one site.
However, that site is currently occupied by a non-cannabis user. A CUP runs with the land unless revoked.
The current Ordinance does not allow for retail storefronts (dispensaries) or delivery from uses in Woodland.
The ordinance prohibits commercial cannabis cultivation (indoor and outdoor). Commercial cannabis uses may not be located any closer than 600 feet to any sensitive use, as measured from parcel to parcel.
The initial direction of the City Council regarding commercial cannabis provided for an incremental approach that would allow assessment of critical impacts before consideration on a broader basis. The approach has allowed the introduction of commercial cannabis in a measured and phased manner to allow assessment and evaluation of impacts prior to any future expansion. To date, the City has found that it has been able to effectively mitigate any potential negative impacts that could result from operating commercial cannabis uses, and the existing cannabis businesses have not created significant issues for the City.
The City has recently received an initial inquiry from Perfect Union, a commercial cannabis retail business with several locations throughout Northern California, to determine whether the City would amend the City’s Zoning Code to allow for retail cannabis businesses. Based on this inquiry, City staff, working with an Ad Hoc Subcommittee comprised of two City Council members and three Planning Commissioners (as further described below) began the process of considering possible amendments to the Zoning Code that would allow for retail cannabis businesses, subject to certain limitations as described in this report. Perfect Union has also proposed a potential future commercial cannabis retail location, which will only be considered through a separate CUP process in the event that the proposed amendments to the Zoning Code are approved.
In addition to a CUP, each individual business entity is required to obtain a Cannabis Business Permit (CBP). A CUP is land use based and considers the possible location for the use. A CBP addresses the regulatory and operational aspects of each cannabis business and is issued upon completion of all regulatory requirements including a security plan, business plan, tenant improvements, and issuance of the State operating license. A review of the CBPs is conducted on an annual basis and requires payment of an annual fee at the time of license renewal.
The Chart below illustrates commercial cannabis uses that are currently allowed within Woodland.
As part of the regulatory review, the applicant is required to execute an operating agreement that includes a requirement for a monthly payment to the City based on an agreed upon percentage of their gross receipts for the previous month to offset potential impacts on the City stemming from applicable cannabis uses. All of the approved business entities have executed operating agreements.
Over the last year, interested members of the community and cannabis industry have approached the City to request consideration for amendments to the current regulations to allow retail cannabis dispensaries. In response to the most recent inquiry from Perfect Union and their commitment to fund the City’s efforts to evaluate ordinance updates, the City initially engaged an Ad Hoc Cannabis Subcommittee made up of members of the City Council, Planning Commission, and supported by City Planning staff and the City Attorney.
The City Council appointed two members (Garcia-Cadena and Vega), and the Planning Commission three members (Harris, Hurst, and Lizarraga) to the Ad Hoc Subcommittee for the purpose of evaluating proposed retail cannabis uses. The subcommittee convened on three occasions. On July 6, 2021, the subcommittee finalized their recommendations, which are as follows:
• Allow cannabis retail use in most commercial and corridor mixed-use zones, including the Downtown. • Allow incidental cannabis distribution to serve the retail business only, subject to restrictions. • Retail uses are not recommended in the Industrial or Light Industrial Districts, Regional Commercial, or Residential zones.
• As with all other cannabis uses, retail uses shall be subject to a 600-foot buffer from schools, youth programs, or parks consistent with the current ordinance. o The subcommittee considered a 1,000-foot buffer, but it was determined that when the 600-foot buffer was applied, it mitigated concerns regarding overconcentration in the Downtown along Main Street. (Attachment 8) On October 7, 2021, the Planning Commission held a public hearing at their regularly scheduled meeting to consider the proposed land use/zoning ordinance amendments and unanimously (5-0, 1-absent) recommended approval to the City Council.
Discussion:
Zoning
The purpose of a zoning ordinance is to provide land use controls over certain uses consistent with State Law.
Zoning generally regulates specified uses (permitted, conditionally permitted or prohibited), where uses may be located, and sets the entitlement process to determine what regulatory body shall consider and approve those
uses. All proposed or approved zoning regulations and cannabis uses may be later amended based on further Council direction.
Staff has prepared a draft Zoning Ordinance to permit, subject to the granting of a conditional use permit, commercial cannabis retail uses. The table below summarizes cannabis uses as currently allowed, and as proposed.
Proposed revisions to the Zoning Code, Interim Zoning Ordinance, and Downtown Specific Plan District A are shown in bold and underline or strikeout and provided in Attachments 2, 3, and 4 to this report.
Proposed Allowed Uses
Retailers, commonly referred to as “dispensaries,” conduct retail sales of medical and/or recreational cannabis and cannabis products to consumers. State law requires all retailers to operate from a physical premise, even if sales are performed exclusively through delivery.
The state license type for a retail use is either a Type 9- non-storefront retailer (delivery only), or a Type 10- storefront retailer. The City is only considering allowance for Type 10. A Type 10 allows both storefront and delivery from that physical address. Cannabis retailers that will not be open to the public and that perform sales exclusively by delivery are prohibited.
Zoning Definition
The following definition is already included in the existing Ordinance (17.110.030):
“Cannabis retailer” means a premise permanently located in the City licensed by the State of California pursuant to the Medicinal and Adult-Use Cannabis Regulation and Safety Act, California Business and Professions Code Section 26000 et seq., as may be amended, where cannabis is provided for retail sale to consumers, including an establishment that delivers cannabis as part of a retail sale. Unless otherwise specified, “cannabis retailer” means both a retailer selling medical cannabis and medical cannabis products to patients with valid physician’s recommendations, and a retailer providing adult-use cannabis and cannabis products for
adults 21 years of age and over, pursuant to State law.
Proposed Locations
As proposed in Section 17.110.100 of the Municipal Code, cannabis retailers may be considered in a number of commercial locations. New in Section 17.110.100 A Corridor Mixed Use East Street (CMU-E), Corridor Mixed Use West Main (CMU-WM), Corridor Mixed Use Kentucky (CMU-K); Corridor Mixed Use Light Industrial Flex Overlay (CMU-LIF), Community Commercial, Regional Commercial Light Industrial Flex Overlay (RC- LIF), Downtown Mixed Use (DMU) District A. Areas where cannabis retail is not recommended includes Industrial/Industrial with Light Industrial Flex overlay, Regional Commercial, Neighborhood Commercial, and Spring Lake Specific Plan commercial districts. Attachment 8 provides a map illustrating proposed allowed zones with a 600-foot sensitivity buffer overlay.
Proposed Number of Cannabis Retailers
Section 17.110.050 of the Woodland Zoning Ordinance allows for consideration of up to six (6) conditional use permits (CUPs) for commercial cannabis manufacturing, distribution and testing facilities, which may be located in the Industrial and Industrial/Light Industrial Flex Zones. The amendment to Section 17.110.050 D would allow consideration for up to four (4) cannabis retail storefront conditional use permits. This would provide for 10 commercial cannabis CUPs in total.
Proposed Incidental Distribution
Sections 17.110.100 B and C of the Municipal Code, provide allowance for consideration of incidental distribution activities that specifically will only serve that retail facility. With this allowance, a cannabis retailer will be able to pick up and deliver a product to their own business or between their stores. They will not be allowed to conduct distribution for other cannabis businesses. The distribution portion must be appurtenant and incidental to the retail use as shown below.
Review Process and Evaluation Criteria
A conditional use permit for commercial cannabis requires final approval by the City Council. It is anticipated that more than four businesses will be interested in operating retail cannabis facilities in Woodland. As a result, it is necessary to provide for a structured review process in order to allow for effective evaluation of the proposed applications. Staff recommends that the following review steps be considered. Provide an initial application submittal and closing date. Review all applications for completeness and accuracy. Prepare an initial cursory comparison based on information provided to date. Use of evaluation criteria to help with evaluation comparison. (Attachment 9)
Conduct a Cannabis Subcommittee hearing to allow all applicants to make a presentation regarding their proposal. Presentations can be recorded for later viewing by the full Council. Subcommittee to evaluate and identify top candidates.
Utilize all the information to conduct a final review for applications. Schedule for PC and CC hearings
Cannabis Business and Operating Requirements
Every business interested in opening a commercial cannabis business in the City of Woodland will need a CUP, Cannabis Business Permit (CBP) and State of California License.
The Zoning Ordinance is one piece of a regulatory structure for commercial cannabis. In addition, the City has adopted a Cannabis Business Permit (CBP) Ordinance (Chapter 5.28 of the Municipal Code).
The CBP review requires the submittal of extensive information regarding business operations. The proposed
amendments to Chapter 5.28 allow for issuance of CBPs to cannabis retailers, and include specific operational requirements that will apply to those retailers. Prior to issuance of a CBP, a commercial cannabis business must provide a detailed security plan to be approved by the Chief of Police. The security plan must include such things as number and location of surveillance cameras, the alarm system, and an on-site security guard. All sites are inspected by the Police Department. Updated security requirements have been added to Section 5.28.260 in order to reflect best practices as recommended by the Police Department. The proposed amendments additionally add a cannabis work permit requirement that will provide for annual review of cannabis business employees and ensure that they remain in compliance with the City’s requirements regarding background checks and criminal history. The Police Department reviewed cannabis business oversight in several jurisdictions throughout the State, and believes the cannabis work permit requirement will help to facilitate oversight of these businesses. The updated ordinance is provided in Attachment 6.
All businesses must also go through a similar review with the State Bureau of Cannabis Control.
Regulatory Permit Fees
On December 19, 2017 the City adopted Resolution 6982 to allow for cost recovery associated with commercial cannabis activities. The fees are charged at the time of initial approval of the CBP and at annual renewal. Commercial cannabis business renewal fees were updated in May 2020 and the city has recently had the opportunity to re-assess actual costs associated with the existing cannabis administration and enforcement activities and has also evaluated anticipated costs with the addition of retail storefront cannabis. Recommended Commercial Cannabis Permit Fees are provided below.
New Business Commercial Cannabis Permit Fees would be in addition to any Permit Application fee and Conditional Use Permit application fee that would be charged, on a one-time non-refundable basis, to cover costs associated with processing applications from businesses applying for a City of Woodland Commercial Cannabis Business Permit. These fees were established in December 2017 and remain unchanged except for:
• the addition of a Retail Category
• and the fees be subject to an annual Consumer Price Index (CPI) adjustment. This would allow for better cost recovery. This is similar to most fees assessed city-wide.
Renewal Commercial Cannabis Permit Fees are different from the New Business permit fees as far as cost of the city to monitor/inspect and audit. After a business has begun its operations, staff typically spend less time monitoring these businesses. Inspection and compliance review is carried out by the Police Department, while Finance is responsible for monthly collection/accounting of the community benefit proceeds as well as carrying out an annual audit of each business' gross receipt sales.
Renewal fees were reviewed by staff and approved to be reduced by City Council in May 2020 (a reduction from the initial December 2017 rates). Staff has recently analyzed time spent on reviewing and monitoring these businesses and is proposing to further reduce renewal fees and add a retail cannabis renewal fee as well. As stated herein, these fees are intended for full cost recovery. Please see the revised renewal fees below:
Similar to the New Business Permit fees, staff is recommending that these renewal fees be subject to an annual Consumer Price Index (CPI) adjustment.
Planning Commission Review
On October 7, 2021, the Planning Commission held a public hearing to consider the proposed land use/zoning amendments. After review of the report and taking testimony, the Planning Commission voted unanimously to recommend approval of the amendments to the City Council. There were five members present with one absence.
Environmental Determination
The proposed Zoning Ordinance amendment imposes reasonable zoning regulations on commercial cannabis uses to ensure that such uses are conditionally permitted in existing and proposed future zones, subject to zoning standards and locational restrictions that minimize access by minors and provide performance evaluations. Accordingly, this Ordinance will not result in any significant change in the environment within the meaning of Section 15061(b)(3) of Title 14 of the California Code of Regulations. Additionally, commercial cannabis uses authorized by this Ordinance are subject to the granting of a conditional use permit, which requires discretionary review subject to the California Environmental Quality Act (CEQA).
The proposed regulatory ordinance establishes a permitting process and reasonable regulations on commercial cannabis businesses, to the extent that such businesses are authorized to operate in the City pursuant to state and local law, and does not independently authorize any particular cannabis business or use to establish or operate in the City. The regulatory business ordinance is therefore not a project subject to CEQA. As such, the Ordinance is additionally exempt from CEQA review pursuant to Business and Professions Code Section
26055(h).
Public Noticing
The Public Hearing Notice for the Planning Commission hearing was published in a one-eighth page display notice in the Daily Democrat newspaper.
In addition, the City utilized social media outlets to reach the broader community:
• City List serve Business Newsletter – a list service that has approximately 870 emails • Chamber of Commerce, and individual contacts with business representatives • City’s web page
Conclusion: Staff recommends that City Council:
1. Receive a Report;
2. Conduct a public hearing;
3. Find that neither of these Ordinances constitute a project subject to California Environmental Quality Act (CEQA) review pursuant to Section 15061 (b) (3) of Title 14 of the California Code of Regulations as set forth in this Ordinance;
4. Introduce and waive the first reading of Ordinance No___, to amend Chapter 17.110 of the City of Woodland Zoning Code, Exhibit B of the Interim Zoning Code, and Table 8.1 of the Downtown Specific Plan;
5. Introduce and waive the first reading of Ordinance No. ___, to amend Chapter 5.28 of the City of Woodland Municipal Code related to Cannabis Business Permits; and
5. Adopt Resolution No ______ to update Regulatory Permit Fees related to cannabis businesses.
6. Provide input and recommendation concerning the conditional use permit application evaluation process.
Prepared by: Cindy Norris, Principal Planner
Reviewed by: Brent Meyer, Community Development Director
Attachments:
1. ATT 1 - CC Zoning Ordinance 17.110
2. ATT 2 - Cannabis Zoning Code 17.110 Amendments
3. ATT 3 - IZO Comprehensive Use Table Amendments
4. ATT 4 - Downtown Specifc Plan Table 8.1
5. ATT 5 - CC Regulatory Ordinance 5.28 Amendments
6. ATT 6 - Chapter 5.28 11.1.21
7. ATT 7 - Cannabis Revised Fees Resolution
8. ATT 8 - Map of Retail Zones and Sensitivity Buffer
9. ATT 9 - Draft Evaluation Criteria
Attachment 10 (ATT 10)
Projected
FY2018/19 FY2019/20 FY2020/21 FY2021/22 Total
Permit/Permit Renewal Fees 185,120 $ 40,130 $ 140,301 $ 46,326 $ 411,877 $ Projected
FY2018/19 FY2019/20 FY2020/21 FY2021/22 Total
Community Benefit Fee 104,511 $ 239,862 $ 240,000 $ 584,373 $ Total Fees Collected 996,250 $
Actual
Actual
Cannabis Fee Revenue
TO: THE HONORABLE MAYOR AND CITY COUNCIL
AGENDA: City Council Regular Meeting
DATE: May 17, 2022
ITEM #: H.17
SUBJECT: Rescind Urgency Ordinance 1664 "Temporary Outdoor Use Permit" and Adopt Citywide Parklet Program
Recommendation for Action: Staff recommends that the City Council:
1.) Introduce and waive first reading of Ordinance No. _____, rescinding Urgency Ordinance No. 1664 originally adopted June 2, 2020, pertaining to Temporary Outdoor Use Permits;
2.) Adopt Resolution No. _____, approving a citywide Parklet Program to allow for parklets within the city right-of-way, utilizing not more than two (2) city parking spaces in the absence of, or limited private outdoor seating for an annual fee; and appropriate $125,000 from the General Fund to this Program, to financially assist business owners with construction costs associated with (re)constructing and/or enhancing existing parklets.
Staff Contact:
Stephanie Burgos, Business Engagement & Marketing (530) 661-5920, [email protected]
Fiscal Impact:
The City will provide up to $125,000, which will assist new applicants or current permit-holding businesses in (re)constructing and/or enhancing their parklets within the public right-of-way. The City was allocated $11.1 million in American Rescue Plan Act (ARP) funding from the federal government. A significant portion of this funding ($10 million) can be used by the City to pay for general government functions, which has, in turn, created some limited-term and one-time funding flexibility in the City's General Fund. The proposed allocation of funding is consistent with the ARP spending plan reviewed and approved by the City Council at their March 15th meeting. The funds for this project will be allocated from the General Fund reserve balance, and an appropriation of this money is recommended.
Additionally, City street crew resources may be utilized for the installation of traffic safety features on, or near, the parklets. An annual Parklet Permit fee of $500 per parking space, for a maximum of two parking spaces, will be collected to help cover staff costs associated with initial and annual review and installation of parklets as applicable.
Background:
In response to the COVID-19 pandemic and global health crisis, the Federal, State, and County governments declared a state of emergency, to which the City of Woodland followed suit. As a result of the State of California’s March 19, 2020 Stay-at-Home Order and the County Health Officer’s orders, numerous business sectors were required to shut their doors or limit building occupancy to the public, in accordance to the Governor’s and County’s discretion. Considering the adverse financial effects of these mandatory closures, the City of Woodland issued an Urgency Ordinance (Ordinance No. 1664) and Temporary Outdoor Dining & Use Permit to allow businesses to expand their business activity outdoors.
This Ordinance and Permit effectuated by the City Council on June 2, 2020, is valid until the termination of the State and County’s state of emergency in response to COVID-19, or until rescinded by the City Council. Under the current Ordinance and Permit, any emergency temporary use permit that has been issued pursuant to this Ordinance is set to expire thirty (30) days after its termination.
The current Temporary Outdoor Dining & Use Permit is available on the City of Woodland website here:
https://www.cityofwoodland.org/1271/Outdoor-Dining-Use-Permit, and will be updated with the new Permit Program Materials by the end of May 2022.
Since the Permit’s establishment, the City has issued free temporary outdoor use permits to 21 Woodland businesses including 19 restaurants, 1 personal care service, and 1 fitness studio. 14 of these businesses encroached onto their private property, while 7 encroached onto the Downtown public right-of-way (i.e. public parking spaces).
In an effort to monitor the impact of these parklets occupying public parking spaces, two surveys were administered by the City in the Summer of 2021.
The first was a face-to-face survey conducted with existing permit holders to gather information about their perception of the direct impacts (costs and funding, frequency of use, payroll, and business revenue) that the parklets have made on each of their businesses.
The second was a face-to-face and digitally disseminated survey, to which 38 Downtown businesses responded about their perception of the indirect impacts that the parklets have made on their businesses. Results of this survey indicated that well over half of Downtown businesses were in favor of keeping the parklets, highlighting increased foot traffic in Downtown, acknowledgement of the parklets’ role in helping permit-holding businesses stay afloat throughout the pandemic, and availability of outdoor seating. A minority of businesses were in favor of scaling back the parklets or having them completely removed. Concerns about parklets in Downtown focused on reduced parking, traffic slowdowns (due to the red flashing lights), cleanliness of the parklets, storefront visibility, and homeless issues.
The City held a Downtown Business Meeting in November 2021, at which time the survey results were shared with business owners. The City also shared Downtown parking statistics generated by Just Another Parking App (JAPA), looking at the availability of parking spaces on Main Street, First Street and the parking lot in front of City Hall. The generated statistics illustrated that parking in these areas, on average, reached a 60% occupancy rate, and at the most, only hit 80% occupancy – indicating that despite the presence of parklets, there is consistent availability of parking in Downtown Woodland.
In December 2021, the permit-holding fitness studio voluntarily removed its parklet. In January 2022, one of the permit- holding restaurants was asked by the City to scale their parklet from two spaces to one space, notably as this restaurant was the only one out of all permit-holding businesses encroaching on the public right-of-way that already had private back patio seating.
Discussion:
Parklets remain an important and desirable option for Downtown businesses, particularly restaurants and cafes, to support business activity and recovery from the devastating and compounding financial impacts of the COVID-19 pandemic. Taking the feedback received from existing parklet owners and adjacent downtown businesses (as discussed above), City staff have worked to update and improve the original Temporary Outdoor Dining & Use Permit to create a semi-permanent Parklet Program, which attempts to address expressed concerns, provides enhanced design requirements/approval, incorporates annual maintenance review, and paves the way towards a more pedestrian-friendly Downtown.
This updated Parklet Program (“Program”) proposes to:
Provide long term use of the public right-of-way (i.e. parking spaces) for an annual renewal fee to the City of $500 per parking space, for a maximum of two parking spaces. Per discretion of the City, no parklet may exceed two parking spaces in a row, regardless of the businesses it serves. The renewal process shall include both the renewal fee, as well as a City-conducted review of the parklet structure. Renewals shall be processed by the City by September 30th of every year, with prorated monthly fees, as applicable.
Provide up to $20,000 in one-time funding from the allotted $125,000 from the General Fund per qualifying applicant to (re)construct parklets within a maximum of two consecutive public parking spaces, and enhance parklets in accordance with City requirements outlined in the Program. Where structural modification is required for businesses of existing parklets that are currently encroaching on a maximum of 2 parking spaces, parklet owners shall have until October 1, 2022 to be in compliance with the Permit's requirements, while business owners that are currently encroaching on a maximum of 3 parking spaces, or new business applicants, shall have until November 1, 2022 to be in compliance with the Permit's requirements. However, all Parklet Program applications must be submitted by all applicants to the City by September 1.
Any permit holding business of a current Temporary Outdoor Dining & Use Permit that does not comply or wish to participate in the program must completely remove their parklet at their own cost by September 1, 2022. After this date, businesses that wish to encroach onto privately owned outdoor space must submit a request to the City’s Planning Department for design review and approval. Businesses that do not currently have parklets in the public right-of-way and wish to expand onto it may apply for funding consideration to build a new parklet in the public right-of-way, and will be held to comply with the requirements of the Program. Once issued, the Community Development Director may revoke use of the public right-of-way if the applicant violates any of the conditions outlined within the Parklet Program. An applicant may appeal the Community Development Director’s decision to the City Manager. The decision of the City Manager shall be final.
During the pandemic and beyond, the Program stipulations seek to create a long term balance of the designated public right-of-
way between permit and non-permit holding businesses, as well as the community at large. For example, the maximum two- parking space allowance will minimize encroachment on the public right-of-way and adjacent storefronts by reallocating several parking spaces that are currently occupied by parklets back to the public for parking. Parklets that partially or fully block adjacent businesses’ storefront visibility shall require written approval from the affected business owner as well as the property owner if different. Program requirements regarding the parklets’ overall look-and-feel include, but are not limited to, requiring installation of ADA-compliant wooden decking, plants and greenery, and ADA-compliant dining tables. While the annual review of the parklets will take place with permit renewal in September, City staff will inspect the parklets on a routine basis to ensure compliance with all program requirements including maintenance/cleanliness. The traffic signals on Main Street will remain in red flash while the City evaluates the balance between the parklet program and vehicle traffic flow to ensure the downtown accommodates all users of the area.
Conclusion:
Staff recommends that City Council:
1.Introduce and waive first reading of Ordinance No. _____, rescinding Urgency Ordinance No. 1664 originally adopted June 2, 2020, pertaining to Temporary Outdoor Use Permits;
2.Adopt Resolution No. _____ approving a citywide Parklet Program to allow for parklets within the city right-of-way, utilizing not more than two (2) city parking spaces in the absence of, or limited private outdoor seating for an annual fee; and appropriate $125,000 from the general fund to this Program, to financially assist business owners with construction costs associated with (re)constructing and/or enhancing existing parklets.
Prepared by: Stephanie Burgos, Business Engagement & Marketing Reviewed by: Brent Meyer, Community Development Director / City Engineer
Attachments:
1. Resolution_Citywide Parklet Program Permit
2. Ordinance Rescinding Ordinance 1664 - Emergency Outdoor Use Permit - COVID 19
3. Application_Parklet Program Grant
4. Citywide Parklet Program Permit
5. Guidelines_Parklet Program Grant
6. Appendix 1-Rules and Reg_Parklet Program Permit
82093.00086\32982382.1
RESOLUTION NO. ___
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WOODLAND
APPROVING A CITYWIDE PARKLET PROGRAM TO ALLOW FOR PARKLETS WITHIN THE CITY RIGHT-OF-WAY; AND ALLOCATING $125,000 FROM THE
GENERAL FUND TO THIS PROGRAM
WHEREAS, in response to the COVID-19 pandemic and global health crisis, the President of the United States, the Governor of the State of California, the County of Yolo, and the City of Woodland, have each proclaimed a state of emergency; and WHEREAS, on March 19, 2020, the Governor issued Executive Order N-33-20 (the “Stay-at-Home Order”), ordering all State of California residents to shelter at home or at their place of residence, except as needed to ensure continuity of operations in essential critical infrastructure sectors and additional sectors as directed by the State Public Health Officer; and WHEREAS, as the result of the Stay-at-Home Order and the County Health Officer’s orders, businesses that serve food or beverages were only permitted to provide food and beverages by take-out or delivery; and
WHEREAS, considering the adverse financial effects of these mandatory closures, the City of Woodland issued an Urgency Ordinance (Ordinance No. 1664) creating a Temporary Outdoor Dining & Use Permit on June 2, 2020, which is valid until the termination of the State and County’s state of emergency in response to COVID-19, or until rescinded by the City Council; and
WHEREAS, since the Permit’s establishment, the City issued free temporary outdoor use permits to 21 Woodland businesses including 19 restaurants, 1 personal care service, and 1 fitness studio, 14 of which encroached onto their private property, and 7 of which encroached onto the Downtown public right-of-way (i.e. public parking spaces); and WHERAS, in an effort to monitor the impact of these parklets occupying public parking spaces in Downtown, two surveys were administered by the City in summer 2021, one with permit- holding Downtown businesses to and another with 38 Downtown businesses; and WHEREAS, results of this survey indicated that a majority of Downtown businesses were in favor of keeping the parklets, highlighting increased foot traffic in Downtown, acknowledgement of the parklets’ role in helping permit-holding businesses stay afloat throughout the pandemic, and availability of outdoor seating; and
WHEREAS, a minority of businesses were in favor of scaling back the parklets or having them completely removed. Concerns about parklets in Downtown focused on reduced parking, traffic slowdowns (due to the red flashing lights), cleanliness of the parklets, storefront visibility, and homeless issues; and
82093.00086\32982382.1
WHERAS, parklets remain an important and desirable option for Downtown businesses, particularly restaurants and cafes, to support business activity and recovery from the devastating and compounding financial impacts of the COVID-19 pandemic; and WHEREAS, the proposed Parklet Program is updated to allow for semi-permanent parklets in the Downtown to meet ongoing business needs, while also addressing specific concerns noted in the city conducted surveys.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WOODLAND AS FOLLOWS:
Section 1. The City Council hereby approves the Parklet Program (Exhibit A), providing long term use of the public right-of-way (i.e. parking spaces) for an annual renewal fee to the City of $500 per parking space, for a maximum of two parking spaces. Per discretion of the City, no parklet may exceed two parking spaces in a row, regardless of the businesses it serves. The renewal process, shall include both the renewal fee, as well as a City-conducted review of the parklet structure. The initial application and all consecutive renewals shall be submitted to the City by September 1st of every year, with prorated monthly fees, as applicable.
Section 2. The City Council hereby authorizes the appropriation of $125,000 from the General Fund to provide up to $20,000 in one-time funding per qualifying applicant to (re)construct parklets within a maximum of two consecutive public parking spaces, and enhance parklets in accordance with City requirements outlined in the Program.
Section 3. CEQA. This Ordinance qualifies for a categorical exemption from the California Environmental Quality Act (CEQA) under Section 15301, Class 1 (Existing Facilities), of the CEQA Guidelines. This exemption applies to a class of projects that are considered not to have a significant effect on the environment. This includes projects that consist of the operation, repair, maintenance, permitting, leasing, licensing or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of use beyond that existing at the time of the lead agency’s determination. The proposed project consists of allowing minor site alterations to create temporary ancillary outdoor dining areas or curbside/storefront pick-up areas for existing retail businesses and restaurants. The project would not have a significant effect on the environment. The City Council, therefore, directs that a Notice of Exemption be filed with the County Clerk of the County of Yolo in accordance with CEQA Guidelines.
82093.00086\32982382.1
PASSED AND ADOPTED by the City Council of the City of Woodland at a regular meeting of the City Council held on the 17th day of May, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
____________________________
Mayra Vega
Mayor
ATTEST:
Ana B. Gonzalez Ethan Walsh
City Clerk City Attorney
82093.00086\32982382.1
ORDINANCE NO. ___
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
WOODLAND RESCINDING URGENCY ORDINANCE NO. 1664, WHICH
AUTHORIZED THE COMMUNITY DEVELOPMENT DIRECTOR TO
GRANT EMERGENCY TEMPORARY OUTDOOR USE PERMITS
DURING THE COVID-19 EMERGENCY
WHEREAS, in response to the COVID-19 pandemic and global health crisis, the President of the United States, the Governor of the State of California, the County of Yolo, and the City of Woodland, have each proclaimed a state of emergency; and WHEREAS, on March 19, 2020, the Governor issued Executive Order N-33-20 (the “Stay-at-Home Order”), ordering all State of California residents to shelter at home or at their place of residence, except as needed to ensure continuity of operations in essential critical infrastructure sectors and additional sectors as directed by the State Public Health Officer; and WHEREAS, as the result of the Stay-at-Home Order and the County Health Officer’s orders, businesses that serve food or beverages were only permitted to provide food and beverages by take-out or delivery; and
WHEREAS, considering the adverse financial effects of these mandatory closures, the City of Woodland issued an Urgency Ordinance (Ordinance No. 1664) and Temporary Outdoor Dining & Use Permit on June 2, 2020, which is valid until the termination of the State and County’s state of emergency in response to COVID-19, or until rescinded by the City Council; and WHEREAS, parklets remain an important and desirable option for Downtown businesses, particularly restaurants and cafes, to support business activity and recovery from the devastating and compounding financial impacts of the COVID-19 pandemic; and WHEREAS, the City seeks to implement an updated Parklet Program, which shall be considered by City Council on May 17, 2022.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF WOODLAND DOES HEREBY ORDAIN AS FOLLOWS:
Section 1. The Council hereby rescinds Ordinance no. 1664, which authorized the community development director to grant emergency temporary outdoor use permits during the covid-19 emergency. On the effective date of this Ordinance, Ordinance no. 1664 shall have no further force or effect.
82093.00086\32982382.1
INTRODUCED at a regular meeting of the City Council held on the 17th day of May, 2022 and PASSED AND ADOPTED by the City Council of the City of Woodland at a regular meeting of the City Council held on the ______ day of _________, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
____________________________
Mayra Vega
Mayor
ATTEST:
Ana B. Gonzalez Ethan Walsh
City Clerk City Attorney
300 1st Street – Woodland, CA - 95695
QUESTIONS? [email protected]
Parklet Program Grant Application
Applicant Information
Name of business:
Contact person name:
Contact person email:
Contact person phone:
If selected, the address where grant funds should be mailed:
Business & Employee Information
Is your business a for-profit small business with no more than 20 full-time employees at the start of the pandemic? Yes No
I understand and certify that I currently hold the “Parklet Program Permit in order to qualify for this Grant: Yes In progress (submitted)
If applicable, how many full-time equivalent employees (FTE) did your business have at the start of the pandemic that worked an average of at least 30 hours per week?
__________________________________________________
Note: Part-time employees can be considered an FTE employee (for example, two part-time employees that work 15 hours per week can be identified as one FTE)
300 1st Street – Woodland, CA - 95695
QUESTIONS? [email protected]
Eligibility
Does the applicant certify that they meet all of the eligibility requirements outlined in the Guidelines document?
Yes No
Funding allocation
Program funds must be used on the following (in order of priority). Indicate how funds will be allocated, along with estimated costs:
(Re)construct the Parklet to either one or two publicly owned spaces, per discretion of the City.
Estimated cost: ____________________________________________________
Installation of wooden, weather-proof, and ADA compliant decking. Estimated cost: ____________________________________________________
ADA compliant tables and seating.
Estimated cost: ____________________________________________________
Roofing/weather coverings per approval by the City
Estimated cost: ____________________________________________________
Greenery / plants
Estimated cost: ____________________________________________________
Heaters, misters
Estimated cost: ____________________________________________________
Lighting
Estimated cost: ____________________________________________________
Signage and other aesthetic enhancements
Estimated cost: ____________________________________________________
Below, please write in other funding consideration requests (if not listed above):
300 1st Street – Woodland, CA - 95695
QUESTIONS? [email protected]
Indicate total funding request (adding together above costs - should not exceed $20,000):
$________________________________________________________________________
Required Attachments
Applications must contain each of the following attachments:
W-9 form
City of Woodland business license
Payroll / employment records as of January 1, 2022
○ This is to confirm your status as a qualifying small business
Application Process
Eligible small businesses can submit completed applications beginning May 18, 2022 and ending July 31, at 5:00 PM.
The City will issue notice of award of funds on a rolling basis, as applications are received, and until funds are exhausted.
See “Guidelines” for full Application Process.
Signature of Applicant
Upon approval, this application becomes a binding contract between the City of Woodland and the applicant named above.
All the information provided above is accurate. The City may cancel the agreement at any time upon discovery that the information above is inaccurate.
300 1st Street – Woodland, CA - 95695
QUESTIONS? [email protected]
The applicant bears full responsibility for any and all tax consequences of receiving grant funds including, but not limited to, issuance of a 1099 by the City.
The applicant shall defend and indemnify the City and its employees from and against any and all claims, costs, and reasonable attorney fees that may arise from activities or events funded by these resources.
Applicant signature:
Date:
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Parklet Program
APPLICATION & PERMIT
- Annual Permit fee: $500 per public parking space, up to two spaces -
This Program authorizes a business owner to expand onto a maximum of two (2) City owned parking spaces in the absence of, or limited private outdoor seating. The applicant is subject to an annual review by the City, in addition to a fee of $500 per parking space, for a maximum of two parking spaces. Upon signing this application, the Applicant agrees to the provisions outlined in this document and “Appendix I – Rules and Regulation”.
City of Woodland
Community Development Dept.
300 First St, Woodland CA 95695
(530) 661-5820
www.cityofwoodland.org
SUBMIT APPLICATION TO THE COMMUNITY DEVELOPMENT FRONT DESK AT 300 FIRST STREET OR VIA EMAIL TO [email protected]
1. GENERAL
NAME OF APPLICANT: ______________________________________________________________________________________ NAME OF BUSINESS: ________________________________________________________________________________________ ADDRESS: __________________________________________________________________________________________________ PHONE NUMBER: __________________________ EMAIL: _________________________________________________________ DAYS AND HOURS OF OUTDOOR DINING/USE OPERATION: ____________________________________________________ (IF DIFFERENT FROM BUSINESS OWNER):
NAME OF PROPERTY OWNER ________________________________________________________________________________ PHONE NUMBER: __________________________ EMAIL: _________________________________________________________ SIGNATURE OF PROPERTY OWNER, AUTHORIZING USE OF PUBLIC RIGHT-OF-WAY FOR PARKLET: __________________
2. OUTDOOR USE FORMAT
Check all that apply:
Request for use on PUBLIC property Sidewalk seating/use Parklet
3. INITIAL CONSENT CHECKLIST
INITIAL HERE if submitting a written request to anchor/drill into sidewalk or road: ____________ INITIAL HERE to consent to own and maintain all improvements placed on public property AND to carry out repairs / replacement of Parklet amenities within 14 days of notification from the City: ____________
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 2 INITIAL HERE to consent to responsibility for maintenance of the gutter to ensure flow under/through any improvements placed adjacent the gutter, and provide access to underground utilities under Parklet or furniture upon City request within 24 hours: ____________ INITIAL HERE to provide $1M General Liability Certificate of Insurance AND Policy Endorsement stating City of Woodland as Additional Insured before (re)construction of Parklet If expanding onto adjacent businesses’ storefront(s):
INITIAL HERE to certify that you have received consent from adjacent business/property owner to expand onto adjacent space: ____________
Adjacent business/property owner’s name: __________________________________________________________ Phone number: _____________________________________________________________________________________
SIGNATURE OF ADJACENT OWNER, AUTHORIZING USE OF PUBLIC RIGHT-OF-WAY FOR PARKLET_____________________________________________________________________________________________
4. DESCRIPTION OF ZONE USE
Provide a brief description of layout and furniture materials used AND attach a SITE PLAN (diagram/drawing) of how you plan to set up the zone, including tables, chairs, shade coverings, trash cans, etc. Please label streets if not apparent in diagram. Please note that an ADA accessible path of at least 4 feet must be ensured between the zone and storefront.
5. SUBMISSION CHECKLIST
Application form (present document)
Site Plan (diagram/drawing), including number and spacing of tables, path of travel, shade structures, etc. Certificate of Insurance AND Policy Endorsement for applicant business AND contractor (if applicable) of $1M General Liability stating City of Woodland (its agents, officers, and employees.) as insured (applicable if on PUBLIC property), specifically referring to Parklet or Sidewalk. See Appendix 1 “Rules & Regulations for details. Confirm having read and consent to requirements in Appendix I “Rules & Regulations”
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6. SIGNATURES
7. APPROVAL AND CONDITIONS (TO BE COMPLETED BY CITY OF WOODLAND)
CITY APPROVAL STAMP & DATE (REQUIRED PRIOR TO PARKLET SETUP)
CONDITIONS OF APPROVAL (IF APPLICABLE)
Signature of Business Owner
Print Name
Date
Signature of Property Owner (if different
from Business Owner)
Print Name
Date
300 1st Street – Woodland, CA - 95695
Parklet Program Grant Guidelines
To support the backbone of our local economy, the City of Woodland will award funding to qualifying for-profit small businesses with a maximum of 20 full-time employees through the Parklet Program (“the Program”).
Funds are limited, and not every eligible business is guaranteed assistance. See “Selection Process” below for more information.
Grant Funding
Small businesses may apply for a maximum of $20,000 per parklet structure, regardless of how many businesses it serves, to assist in Parklet (re)construction and enhancements for a maximum of two City-owned parking spaces, as stipulated in the Parklet Program Permit Application and its companion document, Appendix – Rules & Regulations for Parklet Program Permit. Applicants encroaching on 2 or fewer parking spaces shall have until October 1, 2022, while applicants encroaching on 3 or fewer parking spaces shall have until November 1 to be in compliance of the Parklet Program’s stipulations and submit necessary invoices and receipts, totaling to at least the award amount.
A total of roughly $125,000 is available for allocation. The City hopes to support all qualifying applicants, but funds may be subject to award by criteria depending on the amount of applications (see “Selection Process”).
Overview
The following topics are covered in this document:
Eligible applicants
Eligible uses of funds
Application timeline
Required application materials
Selection
Technical notes and definitions
300 1st Street – Woodland, CA - 95695
Eligibility
Eligible Applicants
Applicant must be a for-profit small business that operates in the city of Woodland with at least one full-time employee (can include the owner) and no more than 20 full-time employees.
Applicant must have limited, or no outdoor privately-owned seating, and be seeking to encroach onto City parking spaces.
Applicant must currently hold the Parklet Program Permit, or have submitted an application for consideration.
Applicants’ total calendar year 2021 revenue must be less than $2 million.
The following businesses are ineligible for this program:
Businesses that have ample privately-owned outdoor seating, per the discretion of the City
Businesses out of operation
National franchises and fast-food chains, unless locally owned Lending and investment institutions, including real estate Insurance companies
Gas stations
Non-profit entities
Eligible Uses
Program funds must be used on the following (in order of priority):
(Re)construct the Parklet to either one or two publicly owned spaces, per discretion of the City.
Installation of wooden, weather-proof, and ADA compliant decking. ADA compliant tables and seating.
Roofing/weather coverings per approval by the City
Greenery / plants
Heaters, misters
Lighting
Signage and other aesthetic enhancements
Written requests must be submitted to the City for consideration of funding allocation to uses absent from the above list.
Application Process
Application Timeline
Eligible small businesses can submit completed applications beginning May 18, 2022 and ending on July 31, 2022 at 5:00 PM.
300 1st Street – Woodland, CA - 95695
The City will issue notice of award of funds on a rolling basis, as applications are received, and until funds are exhausted.
Required Application Materials
W-9 form
City of Woodland business license
Payroll / employment records as of January 1, 2022
Selection Process
The City hopes to fund all qualifying applicants, but priority will be given to businesses currently encroaching on public right-of-way.
City staff will make all final decisions on program eligibility and any related interpretations necessary to make a decision.
Technical Notes
Applicants must verify the business has experienced hardship due to COVID-19 (see “Required Application Materials”).
Full-time employees (FTE) are defined as an employee who works at least an average of 30 hours per week.
Part-time employees can be considered an FTE employee for the purposes of this program (for example, two part-time employees that regularly work 15 hours per week can be identified as one FTE in the program application).
A business is defined as a sole proprietorship, a partnership, a corporation, a limited liability company, or other lawful business entities engaged in for-profit operations.
Applicants must operate out of a physical location within the boundaries of the City of Woodland, which have limited, or no private outdoor use space.
Per discretion of the City, no parklet may exceed two parking spaces in a row, regardless of the businesses it serves.
Applicant must have an active City of Woodland Business License and must be in good standing with the City and Yolo County in accordance with the following:
300 1st Street – Woodland, CA - 95695
Complies with all applicable zoning, permit, and municipal or County code requirements.
Not currently involved in litigation with the City or the County. Not subject to any liens or judgments by a city or the County related to the business.
Applicants must be in compliance with all City, County, State, and Federal laws and regulations related to the operation of the business.
If an awardee has an outstanding City utility bill, the City will require that the grant award must first cover all outstanding City utility payments and that the business enroll in a utility payment plan.
Applicants who are involved or have been involved in any of the following legal or financial issues are not eligible:
Applicant has been convicted of a criminal offense relating to the business. Applicant or the business is presently involved in bankruptcy or insolvency proceedings relating to the business.
Applicant or the business is delinquent on any federal taxes, direct or guaranteed federal loans, federal contracts or federal grants relating to the business.
Applicant or the business is currently suspended or debarred from contracting with the federal government for receiving federal grants or loans.
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Appendix I - Rules & Regulations
for Parklet Program Permit
Modified May 2022
City of Woodland
Community Development Dept.
300 First St, Woodland CA 95695
(530) 661-5820
www.cityofwoodland.org
These Regulations pertain to the “Parklet Program Permit Application”. The Applicant of this Permit consents to have read and agreed to the stipulations detailed within this document.
The City reserves the right to determine on a case ‐by‐case basis the suitability and appropriateness of the public property requested by the Applicant Business for a parklet. The City reserves the right to terminate any permit at an y time due to non-compliance with the requirements outlined in this document and the Application. Additionally, issuance of a permit does not grant a vested right to continue operation of a parklet. The City may decline to renew a permit or terminate the Parklet Progra m at any time. Upon notification that a permit will not be renewed or that the Parklet Program has been terminated, the permittee shall remove the parklet from the premises and restore the road right -of-way to its original condition by the later of the expiration of the then-current permit or thirty days from the notification by the City.
Within this document:
“Applicant” means the business applying for the permit. “Parklet” means a structurally sound outdoor use area within a public parking stall.
The applicant understands and agrees that the permit, once issued, is subject to the following requirements:
1) Encroachment Permit: As a condition to receipt of a Parklet Program Permit, the Applicant must also secure a long -term encroachment permit in accordance with Chapter 12.08 and specifically Section 12.08.090 of the Woodland Municipal Code. Applications for the Parklet Progra m Permit and the long-term encroachment permit may be processed concurrently.
2) Insurance:
a) Applicant - The Applicant shall maintain in full force and effect, at its sole cost and expense, Commercial General Liability insurance coverage for claims of bodily injury and property damage liability not less than $1,000,000 for each occurrence. It shal l provide the City with an Additional Insured Endorsement and primary and non -contributory endorsement naming the City of Woodland and its officers, agents and employees as additional insured , and clearly identifying additional areas of policy coverage including the address and location description
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 2 (including measurements) of outdoor patio/dining space and/or parklet. The City of Woodland can provide sample language to include within endorsement, as needed. b) Contractor – If construction for the parklet is pe rformed by a Contractor, the Contractor shall provide proof of commercial general liability, automobile insurance, and workers compensation insurance (if applicable) to the City in amounts and with policies, endorsements and conditions required by the City for the Services. Please contact the City for these requirements.
3) Indemnification: The applicant shall indemnify, protect, defend, save and hold City, its officers, agents, and employees harmless from any and all claims or causes of action for death or injury to persons, or damage to property resulting from intentional or negligent acts, errors, or omissions of the Business or its officers, employees, volunteers, and agents, or from any violation of any federal, state, or municipal law or ordinance, to the extent caused, in whole or in part, by the willful misconduct, negligent acts, or omissions of the business or its employees, subcontractors, or agents, or by the quality or character of the Business’s work. It is understood that the duty of Business to indemnify and hold harmless includes the duty to defend as set forth in Section 2778 of the California Civil Code and including attorney’s fees . Acceptance by City of insurance certificates and endorsements required under this Permit does not relieve Applicant from liability under this indemnification and hold harmless clause. This indemnification and hold harmless clause shall apply to any damages or claims for damages whether or not such insurance policies shall have been determined to apply and shall further survive the expiration or termination of this Permit. By execution of this Appli cation, applicant Business acknowledges and agrees to the provisions of this Section and that it is a material element of consideration. The City reserves the right to determine on a case- by-case basis the suitability and appropriateness of the public property requested by the Applicant.
4) Americans with Disabilities Act (ADA): The Parklet Area itself must have ADA compliant access and furthermore shall ensure ADA compliance in the immediate adjacent public right -of-way, unless circulation is otherwise rerouted at the discretion and approval of the City. In particular, a minimum four-foot (4’0”) w ide path of travel must be maintained along all pedestrian walkways from the Parklet to all storefronts, regardless of the width of the sidewalk . This provision additionally applies during the installation/construction phase of the proposed patio/parklet.
5) Alcohol and Beverage Control (ABC) Regulations: The Applicant shall comply with all applicable State and County laws and regulations pertaining to outdoor dining/use (including, but not limited to sale and consumption of alcoholic beverages) under this provision. Applicants shall furthermore comply with all applicable California ABC regulations regarding alcohol use for their operations within extended outdoor space. Applicants are solely responsible for securing a valid ABC license to allow/extend business operations within the Parklet. A Permit does not constitute approval by the ABC or City of alcohol use in the Parklet.
6) Sanitation and social distancing: While in effect, The Applicant is responsible for adhering to all health and safety standards as outlined by State of California and Yolo County.
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 3
7) Waste management: The Applicant is responsible for maintaining the Parklet Area free of trash and debris at all times . The Applicant is required to provide and install at least one of its own trash receptacles within the designated area and shall be emptied by the Applicant as needed throughout the day. City -owned trash receptacles n earby the A pplicant’s Parklet Area shall furthermore be monitored for waste associated with business activity and emptied by the Applicant as needed. City staff will be responsible for emptying these trash cans at the normal allotted frequency.
8) Hours of operation: Unless hours of operation are expressly extended or restricted by the Permit, hours of operation for the Parklet Area shall coincide with normal business hours of operation.
9) Cost:
a) The Applicant shall be responsible for an annual renewal fee to the City of $500 per parking space. Per discretion of the City, no parklet may exceed two parking spaces in a row, regardless of the businesses it serves. The renewal process, shall include both the renewal fee, as well as a City-conducted review of the parklet structure. The initial application and renewals shall be submitted to the City by September 1st of every year, with prorated monthly fees, as applicable. b) The Applicant may apply for one time grant funding for up to $2 0,000, until funds run out.
Additional costs exceeding the awarded amount such as setup, mainten ance, potential removal of the Parklet, etc. shall be borne by the Applicant. c) The cost associated with stolen or vandalized items (i.e. tables, chairs, etc.) and / or materials of the Parklet (i.e. roofing, flooring, etc.) shall be borne by the Applicant, and repaired/replaced within 14 days of written notice from the City . The City is not liable for any stolen or vandalized materials associated with the Parklet, and therefore highly recommends locking all equipment when not in use.
10) Materials, furniture, and decorative elements: Materials used in association with the Parklet must be durable, load resistant (when relevant), weather treated and weather resistant, and easy to clean.
Applicant must keep area attractive, clean, and be able to easily repair or replace any broken / damaged components at their own cost within 14 days of written notice from the City. a) Permanent roofing shall not obstruct adjacent business’ storefronts and shall be subject to inspection/approval by the City. Shade structures such as umbrellas shall be well anchored so as not to blow into drive aisles or walkways . Shade structures must have a minimum 7’ clear height from the sidewalk at all times. Canvas, canvas umbrellas, and pergola wooden or metal structures are permitted. Roofing and s hade structures are subject to additional review/approval by the Community Development Department prior to installation. b) Round bistro tables, high top seating, or any other tables are permitted given that they are made from metal, weather resistant or treated wood. Wooden tables shall be properly sealed (i.e. wood stain/varnish) to ensure longevity, cleanliness, and attractiveness. Unless authorized by the City of Woodland, indoor tables should not be used for outdoor seating. ADA seating must be ensured.
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 4 c) Electrical wiring running along ground should be avoided, but if necessary, must be secured according to ADA requirements. Power to the parklet must be drawn exclusively from the Applicant’s business – the Applicant shall not draw power from City lamp posts. d) LED lighting is required for all lighting.
e) The parklet must have plants or other greenery to improve overall aesthetic. Plant selection and placement is subject to review/approval by the Community Development Department prior to installation. All plants must be maintained in good health by Applicant. f) Heaters and misters are subject to review by the City prior to installation. g) Temporary signage may be placed at or near the Parklet Area, provided that such signs do not block, impede or otherwise interfere with the roadway or sidewalk and the safe travel of vehicles and pedestrians (compliant with ADA standards). Signage shall be well anchored so as not to blow into the roadway or walkways.
h) If encroachment onto sidewalk or parking space extends to a neighboring s torefront, the Applicant must consult with, and receive written approval from its neighboring businesses and property owner (if different from business owner). This written approval is to be submitted by the Applicant to the City, who will re-verify approval with the neighboring business in question.
11) PARKLET-SPECIFIC REQUIREMENTS:
a) General:
i) Parklet design must be submitted to the City for consideration before construction. The Applicant must notify the City of renovations, furniture, or additional components that were not part of the original Parklet design for approval (prior to implementation). ii) Parklets are not permitted to occupy any space marked and designated for ADA parking. iii) Parklets are not permitted to be installed in areas marked with red curb for no parking near intersections.
iv) Activity outside of the scope of the Applicant’s business activity, including but not limited to live or amplified sound within the Parklet area is subject to City approval. Depending on the activity, the activity may also be subject to a Special Events Permit.
b) Measurements (see diagram):
i) Each parking space measures approximately 7’5” wide x 22” long. ii) The curb is 5 ½-7 ½” high from the street.
iii) Vertical barrier elements must be a minimum of 32” high and a maximum of 36” high. Plants and greenery may surpass this height requirement if written consent is given to the Applicant by the City.
iv) Shade structures must have a minimum 7’ clear height from the sidewalk at all times. v) The Parklet may extend past the parking stal ls and encroach onto sidewalk if a minimum clear 4-foot ADA-compliant path is maintained between the use space and the storefront.
c) Base/Platform Requirements:
i) The Parklet base should be a freestanding structural foundation that rests on the street surface and should be able to withstand 100 lbs. per square foot at a minimum. If the base is to be permanently attached to the street, curb, or adjacent planting strip, the applicant must first obtain written confirmation from the City.
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 5 ii) Wood decking (pressure treated/weather resistant wood) shall be used as the Parklet’s base.
It shall be properly sealed (i.e. wood stain/varnish) to ensure longevity, cleanliness, and attractiveness. Decking must be ADA compliant. Routine staining/treating of wooden decking is required of applicant at its own cost.
iii) The applicant must be able to allow access to underground utilities beneath the parklet within 24 hours . It is therefore strongly recommended for the Parklet to be built in easily removable sections.
iv) Gutters must remain free of obstruction, must maintain proper gutter flow and must be kept clean by applicant, including parking spaces immediately adjacent to parklet. Screens shall be added to the ends of the Parklet gutter zones to reduce the amount of debris entering the gutter. The side of the base along the street side should be elevated at least ½ from the pavement to allow rainwater to flow underneath the base to the gutters. It is recommended that parklet design allow for ease of access to gutter beneath the parklet base for debris removal.
v) No more than a maximum horizontal gap of ½ inch and maximum vertical height discrepancy of ¼ inch between the curb and the base is allowed.
d) Perimeter/Enclosure Requirements
i) K-rails along with other safety buffers, such as heavy planters or filled wine barrels that can withstand a minimum of 200 lbs. of horizontal force must be placed along the sides of the Parklet that are exposed to vehicle traffic and/or parking. ii) K-rails may be provided by the City upon request. If provided, the applicant shall agree to assume all maintenance for the k-rail units and must replace if gone missing or irreparable.
In particular, the Applicant must be able to have easy access to the k -rails in order to refill them with water (as water levels diminish over time).
iii) The Parklet must have a continuous perimeter enclosing the k-rails within its design along the perpendicular and parallel edges to the street. The enclosure shall be placed in a manner to ensure small children and/or pets cannot enter the adjacent travel way, and k-rails must be completely enclosed so that they are out of sight from all angles. iv) Damages, including dented or broken perimeter walls or roofing must be replaced or repaired at the cost of the Applicant, within 14 days of written notice from the City. v) Plexiglas or other barriers shall not be installed unless written consent is given by both the City and any business owner (if visibility to said business owner’s storefront could be hindered). vi) The Parklet’s design shall be created such that a wheel stop can be installed along the sides perpendicular to traffic. Wheel stop shall be installed by City, at its discretion. If installed, the wheel stop shall be placed on the en d mark/tee of its immediate adjacent parking stall. A clear distance of 4 feet shall be provided from the wheel stop ’s placement to the nearest point of the Parklet.
vii) The Parklet’s barrier must have retroreflective elements such vertical delineators or applied retroreflective tape to ensure visibility facing the street. viii) Appropriate LED lighting, such as string lights, shall be provided in the parklet during business hours and furthermore remain illuminated throughout the night for safety. Lighting must be connected to a timer.
ix) Roofing must be pre-approved by the City before installation.
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 6 12) Overview of prohibited activity within outdoor use space (unless otherwise approved in writing by City):
a) Consumption of alcohol except in compliance with a valid ABC license b) Advertising from outside vendors
c) Amplified sound (ambient background music allowed)
d) Smoking
e) Storage of food trays or carts
f) Gas or diesel generators
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 7 Figure 1: Parklet setup
N:\ComShare\!Economic Development\COVID-19 Biz Resources\Patio Dining Temp\Blank Permit Application\English Page 8 Figure 2: Wheel stop guidance
TO: THE HONORABLE MAYOR AND CITY COUNCIL
AGENDA: City Council Regular Meeting
DATE: May 17, 2022
ITEM #: H.18
SUBJECT: Woodland Finance Authority Wastewater Revenue Refunding Bonds
Recommendation for Action: Staff recommends: (1) that the Board of the Woodland Finance Authority adopt Resolution No. _____, approving the Forms and Authorizing Execution and Delivery of the Second Supplemental Installment Purchase Contract, the Second Supplmemental Trust Agreement, the Escrow Agreement; Authorizing the Issuance of the Woodland Finance Authority Watewater Revenue Refunding Bonds; and Approving Other Actions Related to the Bond; AND (2) that the City Council adopt Resolution No. _____, approving the Issuance by the Woodland Finance Authority of a Wastewater Revenue Refunding Bond; Approving the Forms of and Authorizing Execution and Delivery of a Second Supplemental Installment Purchase Contract; and Authorizing Related Actions and Manners.
Staff Contact:
Kim McKinney, Director of Administrative Services, (530) 661-5849, [email protected]
Fiscal Impact:
The total net cash flow savings are estimated at over $1.66 million, with an average annual savings of $127,975 per year from fiscal years 2022/23 to 2034/35. The net present value savings are over $1.37 million or 6.28% as a percentage of the outstanding 2014 Bonds being refunded. The California Debt and Investment Advisory Commission (“CDIAC”) notes refundings with net present value savings which exceed 3.0% to 5.0% can be considered significant. The proposed refunding exceeds this range at 6.28%.
The costs of issuance of $180,000 are contingent upon issuance of the bonds, will be paid from bond proceeds and are included in all the refunding results provided. Finally, there is no extension of the term with the final maturity remaining on March 1, 2035.
Background:
In 2014, the Woodland Finance Authority issued the Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien) (The “2014 Bonds”) in the original amount of $33.825 million. The proceeds of the 2014 Bonds were used to refund bonds issued by the City’s wastewater system in 2002 and 2005 and to pay costs of issuance. Currently there is $24.77 million outstanding 2014 Bonds.
The proposed 2022 Bonds would refund for significant savings the $21.955 million in outstanding 2014 Bonds payable on or after March 1, 2025 to March 1, 2035. The 2014 Bonds maturing on March 1, 2023 and March 1, 2024, outstanding in the amount of $2.815 million, are non-callable and refunding them does not provide any economic benefit. The 2023 and 2024 maturities will remain outstanding and will be paid as regularly scheduled.
The Tax Cuts and Jobs Act of 2017 eliminated the ability for issuers to refund, on a tax-exempt basis, bonds in advance of their call date. This is commonly known as an "advance refunding". However, bonds may be refunded tax-exempt within 90 days of their call date, a structure which is commonly known as a "current refunding". The 2014 Bonds are not callable until March 1, 2024, meaning a tax-exempt advance refunding is not currently permitted and the Authority would need to wait to do a current refunding until 90 days before March 1, 2024, or on or after December 1, 2023. However, a refunding of the 2014 Bonds can be completed today by selling a new refunding bond at a taxable interest rate which will be in effect until 90 days before the call date or, in this case, December 5, 2023. On December 5, 2023, the interest rate will convert to tax-
exempt. This structure is commonly known as a “Convertible” or “Cinderella” bond.
The resolutions appoint the following firms to work on the sale of the Refunding Bonds (the “Financing Team”):
• Kronick Moskovitz, Tiedemann & Girard and Lozano Smith LLP as Co-Bond Counsel • Hilltop Securities as Placement Agent
• Del Rio Advisors, LLC, as Municipal Advisor
• U.S. Bank Trust Company, National Association, the Trustee and Escrow Agent Discussion:
Staff and the City’s Financing Team secured proposals from direct placement financial institutions that might consider purchasing a Cinderella structure. The Financing Team prepared a term sheet that went out to numerous financial institutions. The City received five (5) qualified responses from various financial institutions. Table 2 summarizes the term sheet responses, with Webster Bank (the “Purchaser”) being the clear winner with both the lowest taxable and converted tax-exempt interest rates.
Table 2: Term Sheet Results
Institution Taxable Rate Tax-Exempt
Rate
Optional
Redemption (1)
Fee for Legal
Counsel
Webster Bank 3.60% 2.845% Tax-Exempt and Taxable
3/1/26 Through 9/1/27 @102%
3/1/28 Through 9/1/29 @ 101%
3/1/30 and Thereafter @ 100%
or
3/1/24 Through 9/1/25 @ 103%
3/1/26 Through 9/1/27 @ 102%
3/1/28 Through 9/1/29 @ 101%
3/1/30 and Thereafter @ 100%
None
Municipal Finance
Corporation
4.50% 3.67% Tax-Exempt
3/1/29 @ 102
3/1/30 @ 101
3/1/31 @ 100
or
Taxable
Any Payment Date on or After
3/1/29 @ 100%
$15,000
Truist Financial
Corporation
3.88% 3.08% Tax-Exempt and Taxable
Any Payment Date @ 101%
or
Callable Beginning 9/1/2028
and after at 100%
$9,500
Capital One Public
Funding
4.15% 3.15% Tax-Exempt
3/1/28 @ 102
3/1/29 @ 102
3/1/31 @ 100
or
Callable Beginning 3/1/29 @
101% and Thereafter at 100%
or
Taxable
None
Callable Beginning 3/1/29 at
101% and after at 100%
Zions
Bancorporation,
NA
4.24% 3.35% Tax-Exempt and Taxable
Callable Anytime @ 100% with
30-days notice
None
Table 3 summarizes the results of refunding the callable 2014 Bonds with the issuance of the 2022 Bond.
Table 3: Estimated Refunding Results
Estimated Refunding Results (1)
2014 Bonds Original Par Amount $33,825,000
2014 Bonds Outstanding $24,770,000
2014 Bonds Amount Refunded (1) $21,955,000
Estimated Refunding Par Amount (2) $23,215,564
Final Maturity (2014 Bonds) March 1, 2035
Final Maturity (2022 Bond) March 1, 2035
Total Savings (2)(3) $1,663,672
Average Annual Savings (2)(3) $127,975
Net Present Value Savings (2) $1,379,075
Net Present Value Savings Percentage (2)(3) 6.28%
Notes
1. The March 1, 2023 ($1,375,000) and March 1, 2024 ($1,440,000) are not part of the refunding
2. Assumes the interest rates presented by the Purchaser in their term sheet dated April 11, 2022
3. From Fiscal Years 2023 to 2035 (see Table 1)
4. As a percentage of the par amount of bonds being refunded Table 4 summarizes the sources and uses of funds for the 2022 Bond.
Table 5 shows the estimated costs of issuance of which the entire amount will be paid from proceeds of the 2022 Bond. All the listed fees and expenses are contingent upon the successful closing of the transaction.
Table 5: Estimated Costs of Issuance
Role Party Budgeted Amount
Co-Bond Counsel KMTG / Lozano Smith $70,000.00
Placement Agent Hilltop Securities $42,500.00
Municipal Advisor Del Rio Advisors, LLC $47,500.00 Line Item Amount
Sources of Funds
Estimated Bond Size (Par Amount)
$23,215,564.00
Total Sources $23,215,564.00
Uses of Funds
Cost of Escrow Securities
$23,035,563.40
Estimated Cost of Issuance $180,000.60
Total Uses $23,215,564.00
Trustee / COI / Trustee Legal U.S. Bank, N.A. $9,150.00 Escrow Agent U.S. Bank, N.A. $1,000.00
CDIAC Fee State Treasurer’s Office $5,000.00
Verification Report Robert Thomas CPA $3,000.00
Miscellaneous / Rounding Adjustment Contingency $1,850.60 Total Estimated Costs of Issuance $180,000.60
Prior to the conversion date of December 5, 2023 the City will notify the Purchaser that the City wishes to exercise the option to convert from taxable to tax-exempt. The Purchaser will then have the option to determine whether the Refunding Bonds are callable beginning on any interest payment date at one of the following two options:
3/1/26 Through 9/1/27 @102%
3/1/28 Through 9/1/29 @ 101%
3/1/30 and Thereafter @ 100%
or
3/1/24 Through 9/1/25 @ 103%
3/1/26 Through 9/1/27 @ 102%
3/1/28 Through 9/1/29 @ 101%
3/1/30 and Thereafter @ 100%
The interest rates on the Purchaser’s proposal are locked through the proposed closing date of May 24, 2021.
The interest rates also will not change once the deal closes, remaining at 3.60% taxable and 2.845% tax- exempt. This eliminates any market risk that interest rates will rise between now and the proposed closing date or after closing through the term of the 2022 Bond.
There is a conversion risk on the 2022 Bond should laws change between now and the conversion date, disallowing the conversion or eliminating tax-exemption. Should the rate not convert, the savings are reduced. However, should conversion not occur, there are still total savings of $480,635 or $36,972 per year with a net present value benefit of 1.796%.
Documents for Review and Consideration
1. Second Supplemental Installment Purchase Contract between the Authority and the City, supplemental to the Installment Purchase Contract and the First Supplemental Installment Purchase Contract between the Authority and the City, each dated March 1, 2014, whereby the City may from time to time acquire wastewater system improvements from the Authority under the general terms specified therein.
2. Second Supplemental Trust Agreement between the Trustee and the Authority, supplemental to the Trust Agreement and the First Supplemental Trust Agreement between the Trustee and the Authority, dated March 1, 2014, which will specify the specific terms of the Bond, according to the terms and conditions set forth therein.
3. Escrow Agreement between the Authority and U.S. Bank Trust Company, National Association, as escrow agent, relating to the refunding of the 2014 Bonds.
4. Placement Agent Agreement between the Authority and Hilltop Securities as Placement Agent whereby Hilltop Securities agrees to purchase the 2022 Bond from the Authority and sell the 2022 Bond to the Purchaser in an arms-length transaction.
Should the Authority and the City Council approve the item tonight, it is anticipated that the following steps will occur with the proposed closing of the 2022 Bond on May 24, 2022.
Conclusion:
Staff recommends: (1) that the Board of the Woodland Finance Authority adopt Resolution No. _____, approving the Forms and Authorizing Execution and Delivery of the Second Supplemental Installment Purchase Contract, the Second Supplmemental Trust Agreement, the Escrow Agreement; Authorizing the Issuance of the Woodland Finance Authority Watewater Revenue Refunding Bonds; and Approving Other Actions Related to the Bond; AND (2) that the City Council adopt Resolution No. _____, approving the Issuance by the Woodland Finance Authority of a Wastewater Revenue Refunding Bond; Approving the Forms of and Authorizing Execution and Delivery of a Second Supplemental Installment Purchase Contract; and Authorizing Related Actions and Manners.
Prepared by: Kim McKinney, Director of Administrative Services
Attachments:
1. Woodland Finance Authority Resolution - 2022 Wastewater Refunding Bonds
2. City Council Resolution 2022 Wastewater Refunding Bonds
3. Woodland Second Supplemental Installment Purchase Contract
4. Woodland Second Supplemental Trust Agreement
5. Escrow Agreement
6. Placement Agent Agreement City of Woodland Wastewater Refunding
00952456 03498-803 1
WOODLAND FINANCE AUTHORITY
RESOLUTION _________
RESOLUTION APPROVING THE FORMS OF AND AUTHORIZING
EXECUTION AND DELIVERY OF THE SECOND SUPPLEMENTAL INSTALLMENT
PURCHASE CONTRACT, THE SECOND SUPPLEMENTAL TRUST AGREEMENT, AND THE ESCROW AGREEMENT; AUTHORIZING THE ISSUANCE OF THE
WOODLAND FINANCE AUTHORITY WASTEWATER REVENUE REFUNDING BOND; AND APPROVING OTHER ACTIONS RELATED TO THE BOND
WHEREAS, the Woodland Finance Authority (the “Authority”) is a joint exercise of powers agency duly organized and operating pursuant to Chapter 5 of Division 7 of Title 1 of the California Government Code (the “Act”) and a joint exercise of powers agreement (the “Joint Powers Agreement”) between the City of Woodland (the “City”) and the Redevelopment Agency of the City of Woodland;
WHEREAS, Article 4 of the Act and the Joint Powers Agreement authorize the Authority to acquire and sell property and issue bonds to assist in financing and refinancing public improvements for the City, including improvements to the City’s sewage and wastewater conveyance, treatment, and disposal system (the “Wastewater System”); WHEREAS, to refinance improvements to the City’s Wastewater System, the Authority previously issued $33,825,000 principal amount of its Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien) (the “Prior Bonds”), pursuant to the Trust Agreement dated March 1, 2014 (as thereafter amended and supplemented, the “Trust Agreement”), between the Authority and U.S. Bank Trust Company, National Association (as successor-in-interest to U.S. Bank, National Association), as trustee (the “Trustee”);
WHEREAS, to provide funds for the purpose of refinancing improvements to the City’s Wastewater System, the Authority intends to issue its Woodland Finance Authority Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) (the “Bond”), in an aggregate principal amount not to exceed $24,000,000, to refund the Prior Bonds maturing on and after March 1, 2025 (the “Refunded Prior Bonds”);
WHEREAS, on May 17, 2022, the City adopted a resolution approving the refinancing of improvements to the City’s Wastewater System by the issuance of the Bond and making a finding of significant public benefit;
WHEREAS, because the Bond will be issued for the purpose of refinancing wastewater facilities, Government Code section 6586.5(c) exempts these proceedings from the requirements of Sections 6586.5 and 6586.7;
WHEREAS, the City has obtained and disclosed in an open public meeting the estimates of financial information relating to the Bond required by Government Code section 5852.1;
00952456 03498-803 2
WHEREAS, the City has determined that the issuance of the Bond will be in accordance with the City’s capital financing and debt management policy that was adopted on June 20, 2017, pursuant to the requirements of Government Code section 8855(i); WHEREAS, the following proposed agreements and documents relating to the issuance, sale and delivery of the Bond by the Authority, which are incorporated herein by reference, have been presented to the Board of Directors (the “Board”) for its review and approval:
1. the Second Supplemental Installment Purchase Contract (the “Second Supplemental Installment Purchase Contract”) between the Authority and the City, supplemental to the Installment Purchase Contract and the First Supplemental Installment Purchase Contract between the Authority and the City, each dated March 1, 2014, whereby the City may from time to time acquire wastewater system improvements from the Authority under the general terms specified therein;
2. the Second Supplemental Trust Agreement (the “Second Supplemental Trust Agreement”), between the Trustee and the Authority, supplemental to the Trust Agreement and the First Supplemental Trust Agreement between the Trustee and the Authority, dated March 1, 2014, which will specify the specific terms of the Bond, according to the terms and conditions set forth therein;
3. the Escrow Agreement (the “Escrow Agreement”) between the Authority and U.S.
Bank Trust Company, National Association, as escrow agent, relating to the refunding of the Refunded Prior Bonds;
WHEREAS, it appears to the Board that the authorization, approval, execution, and delivery of the agreements described above or contemplated thereby or incidental thereto and the issuance, sale, and delivery of the Bond in accordance with the Second Supplemental Trust Agreement are desirable and in the best interests of the Authority; WHEREAS, amendments to Government Code section 8855(i) made by SB 1029, effective January 1, 2017, impose upon local agencies a mandate to adopt local debt policies prior to their issuing any debt after January 1, 2017; and
NOW, THEREFORE, BE IT RESOLVED, by the Board of Directors of the Woodland Finance Authority, as follows:
Section 1. Recitals. The foregoing recitals are true and correct and the Board so finds and determines.
Section 2. Authorization of Officers to Execute and Deliver Documents. The Board hereby authorizes and directs the President, the Vice President, the Administrator, the Treasurer/Controller and the Secretary of the Authority, and their respective designees, as have been designated by the Board (the “Designated Officers”), for and in the name of the Authority, to approve, execute, and deliver the following agreements and documents:
a. the Second Supplemental Installment Purchase Contract;
00952456 03498-803 3
b. the Second Supplemental Trust Agreement; and
c. the Escrow Agreement;
in substantially the forms presented to the Board at this meeting, which documents are hereby approved, with such changes, insertions, revisions, corrections, or amendments as shall be approved by the officer or officers executing the document for the Authority. The execution of the foregoing documents by a Designated Officer or Officers shall constitute conclusive evidence of such officer’s or officers’ and the Board’s approval of any such changes, insertions, revisions, corrections, or amendments to the respective forms of documents presented to the Board at this meeting. The date, principal amounts of each maturity, interest rates, interest payment dates, denomination, forms, registration privileges, place of payment, terms of redemption, and other terms of the Bond, shall be as provided in the Trust Agreement and the Second Supplemental Trust Agreement, as finally executed.
Section 3. Authorization to Issue the Bond. The Board hereby authorizes the issuance of the Bond in accordance with the terms of the Trust Agreement and the Second Supplemental Trust Agreement, as finally executed.
Section 4. Authorization of Sale. The Board hereby authorizes the sale of not to exceed $24,000,000 principal amount of the Bond to Webster Bank, National Association (the “Purchaser”) pursuant to the Letter Agreement for Purchase. The Designated Officers are hereby authorized and directed to negotiate with the Purchaser the final terms of the sale and its timing.
The Board hereby determines that the sale of the Bond by negotiation would result in an overall lower cost.
Section 5. Execution of the Bond. The Designated Officers are hereby authorized and directed to execute the Bond on behalf of the Authority.
Section 6. Identification of Professionals Involved. The Board hereby approves the firm of Del Rio Advisors, LLC, to act as municipal advisor (the “Municipal Advisor”), Hilltop Securities Inc., to act as placement agent, and the firms of Kronick, Moskovitz, Tiedemann & Girard, a Professional Corporation and Lozano Smith, LLP, to act as co-bond counsel with respect to the issuance of the Bond.
Section 7. General Authorization. The Board hereby authorizes and directs the Designated Officers and other officers and agents of the Authority, and each of them individually, for and in the name of and on behalf of the Authority, to do any and all things and to execute and deliver any and all documents that they may deem necessary or advisable in order to complete the sale, issuance, and delivery of the Bond and otherwise to carry out, give effect to, and comply with the terms and intent of this resolution. All actions heretofore taken by such officers and agents that are in conformity with the purposes and intent of this resolution are hereby ratified, confirmed and approved in all respects.
Section 8. Effective Date. This resolution shall take effect immediately upon its passage.
00952456 03498-803 4
APPROVED, PASSED AND ADOPTED on May 17, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
Secretary of the Authority
1571654.1 9127-001 1
CITY COUNCIL OF THE CITY OF WOODLAND
RESOLUTION NO. ______
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WOODLAND APPROVING
THE ISSUANCE BY THE WOODLAND FINANCE AUTHORITY OF A WASTEWATER REVENUE REFUNDING BOND; APPROVING THE FORMS OF AND AUTHORIZING
EXECUTION AND DELIVERY OF A SECOND SUPPLEMENTAL INSTALLMENT PURCHASE CONTRACT; AND AUTHORIZING RELATED ACTIONS AND MATTERS WHEREAS, pursuant to Article 1 of Chapter 5 of Division 7 of Title 1 of the California Government Code, the City of Woodland (the “City”) and the Redevelopment Agency of the City have established a joint exercise of powers agency, the Woodland Finance Authority (the “Authority”), for the purpose of, among other things, financing and refinancing public improvements; and
WHEREAS, the City intends to refinance costs of certain improvements to its sewage and wastewater conveyance, treatment, and disposal system (the “Wastewater System”), and the Authority is authorized pursuant to Article 4 of Chapter 5 of Division 7 of Title 1 of the California Government Code to issue bonds to finance and refinance said improvements; and WHEREAS, the Authority and the City have entered into an Installment Purchase Contract dated March 1, 2014, as supplemented by the First Supplemental Installment Purchase Contract dated March 1, 2014 (the "Installment Purchase Contract"), pursuant to which the City purchased from the Authority facilities for the Wastewater System in exchange for the installment payments described therein, which are payable solely from the revenues of the Wastewater System; and
WHEREAS, to assist the City in providing funds for the purpose of financing and refinancing certain capital improvements to the Wastewater System, the Authority issued its Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien) (the “Prior Bonds”), pursuant to the Trust Agreement dated March 1, 2014 (as thereafter amended and supplemented, the “Trust Agreement”), between the Authority and U.S. Bank Trust Company, National Association (as successor-in-interest to U.S. Bank, National Association), as trustee (the “Trustee”); and WHEREAS, the Installment Purchase Contract permits the City to incur additional obligations secured on parity with its obligations thereunder, subject to the terms and conditions stated therein;
WHEREAS, the City issued its Wastewater Revenue Refunding Bond, Series 2017, which is secured by the Wastewater Revenues on parity with the Installment Purchase Contract; and
WHEREAS, the Trust Agreement permits and provides for the execution and delivery of additional series of bonds secured on a parity basis with all other bonds executed and delivered thereunder, subject to the terms and conditions stated in the Trust Agreement; and
1571654.1 9127-001 2
WHEREAS, the Authority has determined to issue its “Woodland Finance Authority Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible)” (the “Bond”) to refund the outstanding Prior Bonds maturing on and after March 1, 2025 (the “Refunded Prior Bonds”), and to amend and restate the Installment Payments relating to the Prior Bonds, which will be applied by the Authority to pay debt service on the Bond and the unrefunded maturity of the Prior Bonds; and
WHEREAS, significant public benefits, including more efficient delivery of local City services to the public, will be provided through the Authority’s refinancing certain improvements to the City’s Wastewater System by issuing bonds pursuant to Article 4 of Chapter 5 of Division 7 of Title 1 of the California Government Code to refund the Refunded Prior Bonds; and
WHEREAS, because the bonds will be issued for the purpose of refinancing wastewater facilities, Government Code section 6586.5(c) exempts these proceedings from the requirements of Sections 6586.5 and 6586.7; and
WHEREAS, the issuance of the Bond will be in accordance with the City’s capital financing and debt management policy that was adopted on June 20, 2017, pursuant to the requirements of Government Code section 8855(i); and
WHEREAS, the following document relating to the issuance, sale and delivery of the Authority’s proposed wastewater revenue refunding bond, which is incorporated herein by reference, has been presented to the City Council for its review and approval:
the Second Supplemental Installment Purchase Contract (the “Second Supplemental Installment Purchase Contract”) between the Authority and the City, supplemental to the Installment Purchase Contract and the First Supplemental Installment Purchase Contract between the Authority and the City, each dated March 1, 2014, whereby the City may from time to time acquire wastewater system improvements from the Authority under the general terms specified therein,
WHEREAS, it appears to the City Council that the authorization, approval, execution, and delivery of the agreements described above or contemplated thereby or incidental thereto and the Authority’s issuance, sale, and delivery of bonds are desirable and in the best interests of the City;
NOW, THEREFORE, BE IT RESOLVED by the City Council as follows:
Section 1. Recitals. The foregoing recitals are true and correct and the City Council so finds and determines.
Section 2. Approval of Issuance of Bond. The City hereby approves the issuance of the Woodland Finance Authority Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) by the Authority, in a principal amount not to exceed $24,000,000. The date, amounts of principal installments, maturity, interest rates, interest payment dates, denominations, forms, registration privileges, place or places of payment, terms of redemption, and other terms of the Bond, shall be as provided in the Trust Agreement, as supplemented by
1571654.1 9127-001 3
the First Supplemental Trust Agreement and the Second Supplemental Trust Agreement, as finally executed; provided that the net present value of the debt service savings produced by the refunding of the Refunded Prior Bonds shall be at least five percent (5.00%) of the par amount of the Refunded Prior Bonds.
Section 3. Authorization of Officers to Execute and Deliver Documents. The City Council hereby authorizes and directs the Mayor, the City Manager, the Director of Administrative Services, the Finance Director, and the City Clerk, and their respective designees (the “Designated Officers”), for and in the name of the City, to approve, execute, and deliver the Second Supplemental Installment Purchase Contract in substantially the form presented to the City Council at this meeting, which document is hereby approved, with such changes, insertions, revisions, corrections, or amendments as shall be approved by the officer or officers executing the document for the City. The execution of the foregoing document by a Designated Officer or Officers shall constitute conclusive evidence of such officer’s or officers’ and the City Council’s approval of any such changes, insertions, revisions, corrections, or amendments to the respective form of document presented to the City Council at this meeting.
Section 4. Retention of Municipal Advisor, Bond Counsel, and Placement Agent. Del Rio Advisors, LLC (the “Municipal Advisor”), is hereby appointed municipal advisor to the City for the issuance and sale of the Bond. Kronick, Moskovitz, Tiedemann & Girard, a Professional Corporation, and Lozano Smith, LLP are hereby appointed co-bond counsel to the City for the issuance and sale of the Bond. Hilltop Securities Inc. is hereby appointed as placement agent to the City for the issuance and sale of the Bond.
Section 5. Disclosure of Specified Financing Information. Pursuant to the requirements of Government Code section 5852.1, the City is required to disclose at a public meeting certain information related to the financing. The City Council has obtained from the Municipal Advisor good faith estimates of this required information and hereby discloses the estimated information as shown in Exhibit A attached hereto and incorporated herein by reference.
Section 6. Authorization of Officers to Execute Documents. The City Council hereby authorizes and directs the Designated Officers and other officers and agents of the City, and each of them individually, for and in the name of and on behalf of the City, to do any and all things and to execute and deliver any and all documents that they may deem necessary or advisable in order to complete the sale, issuance, and delivery of the Bond and otherwise to carry out, give effect to, and comply with the terms and intent of this resolution. All actions heretofore taken by such officers and agents that are in conformity with the purposes and intent of this resolution are hereby ratified, confirmed and approved in all respects.
Section 7. Effective Date. This resolution shall take effect immediately upon its adoption.
1571654.1 9127-001 4
APPROVED, PASSED, AND ADOPTED this 17th day of May 2022 by the City Council of the City of Woodland by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
___________________________________
Mayra Vega, Mayor
ATTEST:
________________________________
Ana B. Gonzalez, City Clerk
1571654.1 9127-001 5
Exhibit A
Specified Financial Information
The good faith estimates set forth herein are provided with respect to the Bond. Such good faith estimates have been provided to the City by Del Rio Advisors, LLC, as municipal advisor to the City. Each estimate is based on the City’s financing plan and current market conditions, including market interest rates prevailing at the time of preparation of the estimate and assumes the conversion to a tax-exempt obligation as provided in the financing documents.
Principal Amount. The estimated aggregate principal amount of the Bond to be sold is $23,215,564.00.
True Interest Cost. The estimated true interest cost of the Bond, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the Bond, is 3.0057215%.
Finance Charge. The estimated finance charge for the Bond, which means the sum of all fees and charges paid to third parties (or costs and credit enhancement associated with the Bond), is $180,000.60.
Amount of Proceeds to be Received. The estimate of the amount of proceeds to be received by the Authority from the sale of the Bond, less the finance charge of the Bond, as estimated above, is $23,035,563,40. (No capitalized interest is expected to be funded with proceeds of the Bond.)
Total Payment Amount. The estimated total payment amount, which means the sum total of all payments the Authority will make to pay debt service on the Bond, plus the finance charge for the Bond, as described above, not paid with the proceeds of the Bond, calculated to the final maturity of the Bond, is $28,780,077.49.
The foregoing estimates are good faith estimates only. The actual figures may differ from the estimates owing to (a) differences between assumptions regarding the date of the sale of the Bond, the principal amount of the Bond sold, the amortization of the Bond, and market interest rates at the time of sale of the Bond and actual facts, (b) other market conditions, (c) changes in the City’s financing plan, or (d) a combination of such factors.
SC356381 03498-803
SECOND SUPPLEMENTAL
INSTALLMENT PURCHASE CONTRACT
between the
CITY OF WOODLAND
and the
WOODLAND FINANCE AUTHORITY
Dated May 1, 2022
relating to
$[principal amount]
WOODLAND FINANCE AUTHORITY
WASTEWATER REVENUE BOND, REFUNDING SERIES 2022
(FEDERALLY TAXABLE CONVERTIBLE)
(supplemental to the Installment Purchase Contract dated March 1, 2014, and the First Supplemental Installment Purchase Contract dated March 1, 2014)
SC356381 03498-803i
SECOND SUPPLEMENTAL INSTALLMENT PURCHASE CONTRACT
WOODLAND FINANCE AUTHORITY
WASTEWATER REVENUE BOND, REFUNDING SERIES 2022
(FEDERALLY TAXABLE CONVERTIBLE)
TABLE OF CONTENTS
Page
I. Definitions............................................................................................................................2 II. Supplemental Provisions......................................................................................................2 ARTICLE X SERIES 2022 INSTALLMENT PAYMENTS.......................................2 Section 10.1. Restated Purchase Price of the Prior Projects..................................2 Section 10.2. 2022 Purchase Price.........................................................................2 Section 10.3. Installment Payments.......................................................................2 Section 10.4. Conversion .......................................................................................3 Section 10.5. Additional Information ....................................................................3 Section 10.6. Documents to be Delivered at Closing ............................................3 III. Provisions of the Installment Purchase Contract .................................................................4 IV. Separability of Invalid Provisions........................................................................................4 V. Effect of Headings and Table of Contents...........................................................................4 VI. Third Party Beneficiary........................................................................................................4 VII. Waiver of Jury Trial; Agreement for Judicial Reference; No Sovereign Immunity............4 VIII. Execution in Counterparts....................................................................................................5 IX. City’s Notice Filings Related to this Second Supplemental Installment Purchase Contract for SEC Rule 15c2-12..........................................................................................................5 EXHIBIT A Series 2022 Installment Payments........................................................................A-1 EXHIBIT B Documents to be Delivered at Closing..................................................................B-1
SC356381 03498-8031Second Supplemental Installment Purchase Contract
SECOND SUPPLEMENTAL
INSTALLMENT PURCHASE CONTRACT
This SECOND SUPPLEMENTAL INSTALLMENT PURCHASE CONTRACT, dated May 1, 2022 (this “Second Supplemental Installment Purchase Contract”), between the CITY OF WOODLAND (the “City”), a municipal corporation duly organized and existing under and by virtue of the laws of the State of California, and the WOODLAND FINANCE AUTHORITY (the “Authority”), a joint exercise of powers agency duly created and existing pursuant to the laws of the State of California and an agreement entitled “Joint Exercise of Powers Agreement” between the City and the Redevelopment Agency of the City of Woodland; W I T N E S S E T H:
WHEREAS, the City has made certain public capital improvements to the City’s sewage and wastewater conveyance, treatment, and disposal system (the “Wastewater System”), and the Authority financed and refinanced the acquisition of those improvements and sold them to the City upon the terms and conditions set forth in the Installment Purchase Contract, as supplemented by the First Supplemental Installment Purchase Contract each dated March 1, 2014 (together, the “Series 2014 Installment Purchase Contract”), between the Authority and the City (as so supplemented and together with this Second Supplemental Installment Purchase Contract, the “Installment Purchase Contract”);
WHEREAS, the Authority issued its Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien) (the “Prior Bonds”) to finance and refinance the costs of those improvements pursuant to the Trust Agreement as supplemented by the First Supplemental Trust Agreement, each dated March 1, 2014 (together, the “Series 2014 Trust Agreement”) between the Authority and U.S. Bank Trust Company, National Association (as successor-in-interest to U.S. Bank National Association), as trustee (the “Trustee”) (as so supplemented and together with the Second Supplemental Trust Agreement dated May 1, 2022 (the “Second Supplemental Trust Agreement”), the “Trust Agreement”);
WHEREAS, the Authority has determined to issue its Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) (the “Series 2022 Bond”), in the principal amount of $[PRINCIPAL AMOUNT] to refund the outstanding Prior Bonds maturing on and after March 1, 2025 (the “Refunded Prior Bonds”);
WHEREAS, the City has determined to enter into this Second Supplemental Installment Purchase Agreement for the purpose of refunding the installment payments due relating to the Refunded Prior Bonds under the Series 2014 Installment Purchase Contract; WHEREAS, the installment payments hereunder will be applied by the Authority to secure and repay the Prior Bonds that are not being refunded and the Series 2022 Bond authorized pursuant to the Second Supplemental Trust Agreement;
WHEREAS the Authority and the City have duly authorized the execution of this Second Supplemental Installment Purchase Contract;
SC356381 03498-8032Second Supplemental Installment Purchase Contract WHEREAS, all acts, conditions, and things required by law to exist, to have happened, and to have been performed precedent to and in connection with the execution and delivery of this Second Supplemental Installment Purchase Contract do exist, have happened, and have been performed in regular and due time, form, and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this Second Supplemental Installment Purchase Contract;
NOW, THEREFORE, the parties hereto agree as follows:
I. Definitions. For all purposes of this Second Supplemental Installment Purchase Contract and of any certificate, opinion, or other document herein mentioned, unless the context otherwise requires or unless otherwise defined herein, all defined terms shall have the meanings set forth in the Trust Agreement.
2022 Purchase Price means the principal amount plus interest thereon owed by the City to the Authority under the terms hereof as provided in Section 10.2 (2022 Purchase Price).
II. Supplemental Provisions. The following Article and Sections are hereby added to the Installment Purchase Contract:
ARTICLE X
SERIES 2022 INSTALLMENT PAYMENTS
Section 10.1. Restated Purchase Price of Prior Projects. The Authority and the City hereby amend and restate the terms of the purchase of the Series 2002 Project and the Series 2005 Project that were restated in the Series 2014 Installment Purchase Contract. The Authority hereby transfers its interest in and title to the Series 2002 Project and the Series 2005 Project (the “Prior Projects”) to the City, and the City purchases the Prior Projects from the Authority at the Purchase Price set forth in Section 10.2 (2022 Purchase Price).
Section 10.2. 2022 Purchase Price.
(A) 2022 Purchase Price. The 2022 Purchase Price to be paid by the City hereunder for the Prior Projects is the sum of principal amount of the City’s obligation hereunder plus the interest to accrue on the unpaid balance of such principal amount from the effective date hereof over the term hereof, subject to prepayment as provided in Section 3.1 (Prepayment). (B) Principal Component. The principal amount of the Series 2022 Installment Payments to be made by the City to the Authority hereunder is $[principal amount]. (C) Interest Component. The interest to accrue on the unpaid balance of such respective principal amounts is as specified in Exhibit A and shall be paid by the City as and constitutes interest paid on the principal amount of the City’s obligations hereunder.
Section 10.3. Installment Payments. The Authority and the City hereby agree that the City shall pay the 2022 Purchase Price to the Trustee in Installment Payments on each Installment Payment Date in the amounts shown on Exhibit A, subject to any rights of prepayment provided in Section 3.1 (Prepayment). The City shall pay the Installment Payments to the Trustee in
SC356381 03498-8033Second Supplemental Installment Purchase Contract immediately available funds for deposit in the Revenue Fund established pursuant to the Trust Agreement.
The Trustee will apply the remaining Series 2014 Installment Payments for the payment of principal of and interest in the Series 2014 Bonds that mature on March 1, 2023 and March 1, 2024.
The Trustee will apply the Series 2022 Installment Payments for the payment of principal (whether at maturity or upon redemption or acceleration) of and interest on the Series 2022 Bond, until all such amounts shall have been fully paid or provision for the payment thereof shall have been made in accordance with the Trust Agreement.
If the City will not have sufficient Net Wastewater Revenues to make all Installment Payments due on an Installment Payment Date, the City shall so notify the Trustee fifteen (15) Business Days before such Installment Payment Date. If the City fails to make any of the payments required to be made by it under this section, such payment shall continue as an obligation of the City until such amount shall have been fully paid, and the City agrees to pay the same with interest accruing thereon at the rate or rates of interest then applicable to the remaining unpaid principal balance of the Installment Payments, respectively, if paid in accordance with their terms.
Section 10.4. Conversion. The City and the Authority have the right, subject to the satisfaction of certain conditions as provided in the Second Supplemental Trust Agreement at any time on or after December 5, 2023, to convert the interest rate payable with respect to the Series 2022 Bond to the Tax-Exempt Rate (as that term is defined in the Second Supplemental Trust Agreement). An updated Series 2022 Installment Payments table will be provided to the Authority by the City and will automatically be attached and made a part hereof no less than five business days prior to the effective date of the Tax-Exempt Rate.
Section 10.5. Additional Information. The City agrees to furnish to the Owner (as defined in the Trust Agreement) (a) its Audited Financial Statements within one hundred eighty days (180) of the end of the Fiscal Year, and (b) at the request of the Owner, the City’s annual budget as submitted or approved. The City further agrees that it will permit the Owner or its agents and representatives to inspect the City’s books and records and make extracts therefrom at its own expense during regular business hours and in a manner which will not disrupt the normal business routine of the City. The City shall furnish to the Owner such other financial information as it may reasonably request. In the event that the Audited Financial Statements are not available within 180 days of the end of the Fiscal Year, the City will furnish unaudited financial statements to the Owner in the manner described in this paragraph within such period, and will then supply the Audited Financial Statements immediately upon the availability thereof. The City further agrees to provide the Owner annually a debt service coverage calculation for the Wastewater System and all obligations payable from the Net Wastewater Revenues, with such calculation to be prepared by a certified public accountant who may be a City employee or officer.
Section 10.6. Documents to be Delivered at Closing. On or prior to the date of delivery of the Series 2022 Bond, the City and the Authority shall cause to be delivered to the Original Purchaser the documents listed in Exhibit B hereto. The City and the Authority shall not deliver the Series 2022 Bond to the Original Purchaser until the Original Purchaser has executed and
SC356381 03498-8034Second Supplemental Installment Purchase Contract delivered to the District a Letter of Representations in the form as found attached as Exhibit B to the Second Supplemental Trust Agreement.
III. Provisions of the Installment Purchase Contract. Except as in this Second Supplemental Installment Purchase Contract expressly provided, every term and condition contained in the Installment Purchase Contract shall apply to this Second Supplemental Installment Purchase Contract with the same force and effect as if the same were herein set forth at length, with such omissions, variations and modifications thereof as may be appropriate to make the same conform to this Second Supplemental Installment Purchase Contract.
This Second Supplemental Installment Purchase Contract and all the terms and provisions herein contained shall form part of the Installment Purchase Contract as fully and with the same effect as if all such terms and provisions had been set forth in the Installment Purchase Contract.
The Installment Purchase Contract is hereby ratified and confirmed and shall continue in full force and effect in accordance with the terms and provisions thereof, as supplemented and amended hereby.
IV. Separability of Invalid Provisions. If any one or more of the provisions contained in this Second Supplemental Installment Purchase Contract shall for any reason be held to be invalid, illegal, or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Second Supplemental Installment Purchase Contract and such invalidity, illegality, or unenforceability shall not affect any other provision of this Second Supplemental Installment Purchase Contract, and this Second Supplemental Installment Purchase Contract shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The City and the Authority each hereby declares that it would have adopted this Second Supplemental Installment Purchase Contract and each and every other Section, paragraph, sentence, clause, or phrase hereof irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Second Supplemental Installment Purchase Contract may be held illegal, invalid, or unenforceable.
V. Effect of Headings and Table of Contents. The headings or titles of the several Sections hereof, and any table of contents appended to copies hereof, shall be solely for convenience of reference and shall not affect the meaning, construction, or effect of this Second Supplemental Installment Purchase Contract.
VI. Third Party Beneficiary. The Owner is hereby expressly made a third party beneficiary of this Second Supplemental Installment Purchase Agreement.
VII. Waiver of Jury Trial; Agreement for Judicial Reference; No Sovereign Immunity. To the fullest extent permitted by law, the City hereby waives its right to trial by jury in any action, proceeding and/or hearing on any matter whatsoever arising out of, or in any way connected with, the Series 2022 Bond or this Second Supplemental Installment Purchase Agreement or any documents relating to the Series 2022 Bond or this Second Supplemental Installment Purchase Agreement, or the enforcement of any remedy under any law, statute, or regulation. To the extent such waiver is not enforceable, the City hereby consents to the adjudication of any and all such matters pursuant to Judicial Reference as provided in Section 638 of the California Code of Civil Procedure, and the judicial referee shall be empowered to hear and
SC356381 03498-8035Second Supplemental Installment Purchase Contract determine any and all issues in such Reference whether fact or law. The City hereby represents that it does not possess and will not invoke a claim of sovereign immunity for disputes arising out of contractual claims relating to the Series 2022 Bond or this Second Supplemental Installment Purchase Agreement.
VIII. Execution in Counterparts. This Second Supplemental Installment Purchase Contract may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument.
IX. City’s Notice Filings Related to this Second Supplemental Installment Purchase Contract for SEC Rule 15c2-12. In connection with the City’s compliance with any continuing disclosure undertakings (each, a “Continuing Disclosure Agreement”) entered into by the City on and after February 27, 2019, pursuant to SEC Rule 15c2-12 promulgated pursuant to the Securities and Exchange Act of 1934, as amended (the “Rule”), SNB acknowledges that the City may be required to file with the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access system, or its successor (“EMMA”), notice that the City has incurred obligations hereunder and notice of certain subsequent events reflecting financial difficulties in connection with the Series 2022 Bond. The City agrees that it shall not file or submit, or permit to be filed or submitted, with EMMA any documentation that includes the following unredacted sensitive or confidential information about the Original Purchaser or its affiliates: address and account information of the Original Purchaser or its affiliate, e-mail addresses, telephone numbers, fax numbers, names and signatures of officers, employees and signatories of the Original Purchaser or its affiliates, unless otherwise required for compliance with the Rule or otherwise required by law. The City acknowledges that the Original Purchaser is not responsible for the City’s compliance or noncompliance with the Rule or any Continuing Disclosure Agreement. [Signature page follows]
SC356381 03498-803 Signature page to Second Supplemental Installment Purchase Contract IN WITNESS WHEREOF, the parties hereto have executed this Second Supplemental Installment Purchase Contract by their officers thereunto duly authorized as of the day and year first written above.
WOODLAND FINANCE AUTHORITY
By:
Ken Hiatt, Administrator
ATTEST:
Ana B. Gonzalez, Secretary
CITY OF WOODLAND
By:
Mayra Vega, Mayor
ATTEST:
Ana B. Gonzalez, City Clerk
APPROVED AS TO FORM:
City Attorney
SC356381 03498-803A-1Second Supplemental Installment Purchase Contract
EXHIBIT A
REMAINING SERIES 2014 INSTALLMENT PAYMENTS
Installment Payment
Dates
Amount Attributable
to Principal
Amount Attributable
to Interest Total
SERIES 2022 INSTALLMENT PAYMENTS
Installment Payment
Dates
Amount Attributable
to Principal
Amount Attributable
to Interest Total
SERIES 2022 INSTALLMENT PAYMENTS
Pre-Conversion Date
Installment Payment
Dates*
Amount Attributable
to Principal
Amount Attributable
to Interest Total
SC356381 03498-803A-2Second Supplemental Installment Purchase Contract Post- Earliest Conversion Date
Updated Installment Payments table will be provided to the Authority by the City and will automatically be attached and made a part hereof no less than five business days prior to the effective date of the Conversion.
Installment Payment
Dates*
Amount Attributable
to Principal
Amount Attributable
to Interest Total
* Installment Payments are due three Business Days prior to the Installment Payment Date.
SC356381 03498-803B-1Second Supplemental Installment Purchase Contract
EXHIBIT B
DOCUMENTS TO BE DELIVERED AT CLOSING
The following documents shall be delivered at or prior to the Closing Date, the date of delivery of the Series 2022 Bond to the Original Purchaser thereof (the “Closing Date”).
1. Certified copies of the Authority Resolution and the City Resolution.
2. Executed copies of the Second Supplemental Trust Agreement, Second Supplemental Installment Purchase Contract, and Escrow Agreement.
3. The final opinion of Kronick, Moskovitz, Tiedemann & Girard, a Professional Corporation and Lozano Smith, LLP (“Co-Bond Counsel”), dated the Closing Date, substantially in the form set forth in the Form of Series 2022 Bond attached as Exhibit A to the Second Supplemental Trust Agreement, together with letters dated the Closing Date and addressed to the Trustee and the Original Purchaser authorizing each of them to rely on said opinion.
4. A defeasance opinion of Co-Bond Counsel, dated the Closing Date, with respect to the Prior Bonds.
5. An opinion of the Authority Counsel dated the Closing Date and addressed to the Original Purchaser in form and substance acceptable to the Original Purchaser.
6. An opinion of the City Attorney dated the Closing Date and addressed to the Original Purchaser to the effect that:
i. the City is a general law city and municipal corporation duly organized and validly existing under the Constitution and laws of the State of California; ii. the City has full power and authority to execute, deliver and perform its obligations under the Second Supplemental Installment Purchase Contract; iii. the Second Supplemental Installment Purchase Contract has been duly authorized, executed, and delivered by the City and, assuming due authorization, execution, and delivery by and enforceability against the other parties thereto, constitutes valid and binding obligations of the City enforceable in accordance with its terms; iv. no approval, consent, or authorization of any governmental or public agency, authority, or person is required for the authorization, execution, and delivery by the City of the Second Supplemental Installment Purchase Contract or the performance by the City of its obligations thereunder that has not been obtained; v. the authorization, execution, and delivery of the Second Supplemental Installment Purchase Contract by the City and compliance by the City with the provisions thereof do not breach, or result in a default under, any material agreement or other instrument to which the City is a party or by which the City or its properties are bound; violate applicable provisions of statutory law or regulation; or to our current actual
SC356381 03498-803B-2Second Supplemental Installment Purchase Contract knowledge breach or otherwise violate any existing obligation of the City under any court order or consent decree.
vi. except as has been disclosed to the Original Purchaser, there is no litigation, proceeding, action, suit or investigation at law or in equity before or by any court, governmental agency or body, pending, with service of process upon the City having been accomplished, or threatened in writing against the City, challenging the creation, organization or existence of the City, or the validity of the Second Supplemental Installment Purchase Contract or seeking to restrain or enjoin the collection of the 2022 Installment Payments under the Second Supplemental Installment Purchase Contract or in any way contesting the authority of the City to enter into or perform its obligations under the Second Supplemental Installment Purchase Contract.
7. An opinion of counsel to U..S. Bank Trust Company, National Association (as successor-in-interest to U.S. Bank National Association), as Trustee and Escrow Agent (the “Bank”), dated the Closing Date, and addressed to the City, the Authority and the Original Purchaser to the effect that:
i. the Bank is a national banking association, duly organized and validly existing under the laws of the United States, having full power to enter into and perform its obligations under the Second Supplemental Trust Agreement and the Escrow Agreement (collectively, the “Bank Agreements”);
ii. assuming due execution by the other parties thereto, the Bank Agreements have been duly authorized, executed, and delivered by the Bank and constitute the legal, valid, and binding obligations of the Bank enforceable in accordance with their respective terms, except as enforcement thereof may be limited by bankruptcy, insolvency, or other laws affecting the enforcement of creditors' rights generally and by the application of equitable principles, if equitable remedies are sought; iii. no consent, approval, authorization, or other action by any governmental or regulatory authority having jurisdiction over the Bank that has not been obtained is or will be required for the execution and delivery of the Bank Agreements or the consummation of the transactions contemplated by the Bank Agreements.
8. A closing and incumbency certificate of the Authority dated the Closing Date and executed by a duly authorized officer of the Authority to the effect that:
i. The Authority is a joint exercise of powers agency established pursuant to the laws of the State of California.
ii. The Authority has full legal right, power and authority to enter into the Second Supplemental Trust Agreement, the Second Supplemental Installment Purchase Contract, and the Escrow Agreement (the “Authority Documents”) and to carry out its obligations thereunder.
iii. The Authority is not currently, and has not been at any time, in default under any long-term debt obligations.
SC356381 03498-803B-3Second Supplemental Installment Purchase Contract iv. By proper action, the Authority has duly authorized the execution, delivery and due performance of the Authority Documents. v. All information, reports and other papers and data furnished by the Authority to the Original Purchaser were, at the time the same were so furnished, complete and accurate in all material respects and insofar as necessary to give the Original Purchaser a true and accurate knowledge of the subject matter and were provided in expectation of the Original Purchaser’s reliance thereon in entering into the transactions contemplated by the Authority Documents. No fact is known to the Authority which has had or, so far as the Authority can now reasonably foresee, may in the future have a material adverse effect, which has not been set forth in the financial statements previously furnished to the Original Purchaser or in other such information, reports, papers and data or otherwise disclosed in writing to the Original Purchaser prior to the Closing Date. Any financial, budget and other projections furnished to the Original Purchaser by the Authority or its or their agents were prepared in good faith on the basis of the assumptions stated therein, which assumptions were fair and reasonable in light of the conditions existing at the time of delivery of such financial, budget or other projections, and represented, and as of the date of this representation, represent the Authority’s best estimate of its future financial performance.
No document furnished nor any representation, warranty or other written statement made to the Original Purchaser in connection with the negotiation, preparation or execution of the Authority Documents contains or will contain any untrue statement of a material fact or omits or will omit to state (as of the date made or furnished) any material fact necessary in order to make the statements contained herein or therein, in light of the circumstances under which they were or will be made, not misleading.
vi. Neither the execution and delivery of the Authority Documents nor the fulfillment of or compliance with the terms and conditions thereof, nor the consummation of the transactions contemplated thereby, conflicts with or results in a breach of the terms, conditions or provisions of any restriction or any agreement or instrument to which the Authority is now a party or by which the Authority is bound, or constitutes a default under any of the foregoing, or results in the creation or imposition of any lien, charge or encumbrances whatsoever upon any of the property or assets of the Authority, other than as set forth therein.
vii. There is no action, suit, proceeding, inquiry or investigation before or by any court or federal, state, municipal or other governmental authority pending or, to the knowledge of the Authority after reasonable investigation, threatened against or affecting the Authority or the assets, properties or operations of the Authority which, if determined adversely to the Authority or its interests, would have a material and adverse effect upon the consummation of the transactions contemplated by or the validity of the Authority Documents.
viii. The Authority acknowledges that (i) the Original Purchaser is acting solely for its own loan account and not as a fiduciary for the Authority or in the capacity of broker, dealer, municipal securities underwriter or municipal advisor, (ii) the Original Purchaser has not provided, and will not provide, financial, legal (including securities law), tax, accounting or other advice to or on behalf of the Authority with respect to the Authority
SC356381 03498-803B-4Second Supplemental Installment Purchase Contract Documents, (iii) the Original Purchaser has expressed no view regarding the legal sufficiency of its representations for purposes of compliance with any legal requirements applicable to any other party, if any, or the correctness of any legal interpretation made by counsel to any other party, if any, with respect to any such matters, and (iv) the Authority has sought and obtained financial, legal, tax, accounting and other advice (including as it relates to structure, timing, terms and similar matters) with respect to the financing effectuated through the Authority documents from its financial, legal and other advisors to the extent that the Authority desired to obtain such advice. ix. Each of the requirements of subsections (A) through (F) (with the exception of subsection (D) which does not apply) of Section 3.01 (Issuance of Additional Series of Bonds) of the Trust Agreement have been met.
9. A closing certificate of the City dated the Closing Date and executed by a duly authorized officer of the City to the effect that:
i. The City is a municipal corporation duly organized and existing under the Constitution and laws of the State of California. ii. The City has full legal right, power and authority to enter into the Second Supplemental Installment Purchase Contract and to carry out its obligations thereunder.
iii. The City is not currently, and has not been at any time, in default under any long-term debt obligations.
iv. The City’s audited financial statements for the period ended June 30, 2021, present fairly the financial condition of the City and the Wastewater System as of the date thereof and the results of operation for the period covered thereby. Except as has been disclosed to the Trustee and the Original Purchaser, there has been no change in the financial condition of the City or the Wastewater System since June 30, 2021, that will in the reasonable opinion of the City materially impair its ability to perform its obligations under the Installment Purchase Contract. All information provided by the City to the Original Purchaser with respect to the financial performance of the Wastewater System is accurate in all material respects as of its respective date and does not omit any information necessary to make the information provided not misleading. v. As currently conducted, the City’s activities with respect to the Wastewater System are in all material respects in compliance with all applicable laws, administrative regulations of the State and of the United States and any agency or instrumentality of either, and any judgment or decree to which the City is subject. vi. By proper action, the City has duly authorized the execution, delivery and due performance of the Second Supplemental Installment Purchase Contract. vii. All information, reports and other papers and data furnished by the City to the Original Purchaser were, at the time the same were so furnished, complete and accurate in all material respects and insofar as necessary to give the Original Purchaser a
SC356381 03498-803B-5Second Supplemental Installment Purchase Contract true and accurate knowledge of the subject matter and were provided in expectation of the Original Purchaser’s reliance thereon in entering into the transactions contemplated by the Second Supplemental Installment Purchase Contract. No fact is known to the City which has had or, so far as the City can now reasonably foresee, may in the future have a material adverse effect, which has not been set forth in the financial statements previously furnished to the Original Purchaser or in other such information, reports, papers and data or otherwise disclosed in writing to the Original Purchaser prior to the Closing Date. Any financial, budget and other projections furnished to the Original Purchaser by the City or its or their agents were prepared in good faith on the basis of the assumptions stated therein, which assumptions were fair and reasonable in light of the conditions existing at the time of delivery of such financial, budget or other projections, and represented, and as of the date of this representation, represent the City’s best estimate of its future financial performance.
No document furnished nor any representation, warranty or other written statement made to the Original Purchaser in connection with the negotiation, preparation or execution of the Second Supplemental Installment Purchase Contract contains or will contain any untrue statement of a material fact or omits or will omit to state (as of the date made or furnished) any material fact necessary in order to make the statements contained herein or therein, in light of the circumstances under which they were or will be made, not misleading. viii. Neither the execution and delivery of the Second Supplemental Installment Purchase Contract nor the fulfillment of or compliance with the terms and conditions thereof, nor the consummation of the transactions contemplated thereby, conflicts with or results in a breach of the terms, conditions or provisions of any restriction or any agreement or instrument to which the City is now a party or by which the City is bound, or constitutes a default under any of the foregoing, or results in the creation or imposition of any lien, charge or encumbrances whatsoever upon any of the property or assets of the City, other than as set forth therein.
ix. The City is empowered to set rates, fees and charges for the services and facilities furnished by the Wastewater System without review or approval by any state or local government agency.
x. There is no action, suit, proceeding, inquiry or investigation before or by any court or federal, state, municipal or other governmental authority pending or, to the knowledge of the City after reasonable investigation, threatened against or affecting the City or the assets, properties or operations of the City which, if determined adversely to the City or its interests, would have a material and adverse effect upon the consummation of the transactions contemplated by or the validity of the Second Supplemental Installment Purchase Contract or upon the financial condition, assets, properties or operations of the City or the City’s ability to make the 2022 Installment Payments, and the City is not in default with respect to any order or decree of any court or any order, regulation or demand of any federal, state, municipal or other governmental authority, which default might have consequences that would materially and adversely affect the consummation of the transactions contemplated by the Second Supplemental Installment Purchase Contract, or the financial condition, assets, properties or operations of the City or the City’s ability to make the 2022 Installment Payments.
SC356381 03498-803B-6Second Supplemental Installment Purchase Contract xi. The City acknowledges that (i) the Original Purchaser is acting solely for its own loan account and not as a fiduciary for the City or in the capacity of broker, dealer, municipal securities underwriter or municipal advisor, (ii) the Original Purchaser has not provided, and will not provide, financial, legal (including securities law), tax, accounting or other advice to or on behalf of the City with respect to the Second Supplemental Installment Purchase Contract, (iii) the Original Purchaser has expressed no view regarding the legal sufficiency of its representations for purposes of compliance with any legal requirements applicable to any other party, if any, or the correctness of any legal interpretation made by counsel to any other party, if any, with respect to any such matters, and (iv) the City has sought and obtained financial, legal, tax, accounting and other advice (including as it relates to structure, timing, terms and similar matters) with respect to the financing effectuated through the Second Supplemental Installment Purchase Contract from its financial, legal and other advisors to the extent that the City desired to obtain such advice.
10. A certificate of the Bank, dated the Closing Date, to the following effect:
i. the Bank is authorized to carry out corporate trust powers, and has full power and to perform its duties under the Bank Agreements; ii. the Bank is duly authorized to accept the obligations created by the Bank Agreements and to authenticate the Series 2022 Bond pursuant to the terms of the Trust Agreement; and
iii. to the best knowledge of the Bank, after due inquiry, there is no action, suit, proceeding, or investigation, at law or in equity, before or by any court or governmental agency, public board or body pending against the Bank or threatened against the Bank which in the reasonable judgment of the Bank would affect the existence of the Bank or in any way contesting or affecting the validity or enforceability of the Bank Agreements or contesting the powers of the Bank or its authority to enter into and perform its obligations under the Bank Agreements.
11. Original Purchaser’s Letter of Representations.
12. Certificate of the City regarding additional wastewater bonds requirements to the effect that:
i. The requirement of Section 3.03 (Refunding Bonds) of the Trust Agreement has been satisfied with an exhibit attached to the certificate presenting calculations prepared by the City and a Coverage Report, as required by Section 5.4 (A)(2) (Additional Contracts and City Revenue Bonds-Refunding) of the Installment Purchase Contract dated March 1, 2014, between the Authority and the City evidencing that the debt service coverage requirements for the financing represented by the Series 2022 Bond are satisfied.
ii. The conditions precedent to the issuance of the Series 2022 Bond on parity with the City's obligations under the Installment Sale Agreements (Agreements Nos. 14- 805-550, 14-806-550, and 14-807-550), each between the City and the California State
SC356381 03498-803B-7Second Supplemental Installment Purchase Contract Water Resources Control Board, and dated as of July 9, 2014, all as amended as of September 5, 2017, have been satisfied.
iii. The requirement of Section 5.4 (A)(2) (Additional Contracts and City Revenue Bonds-Refunding) of the Bond Issuance Agreement dated September 1, 2017 made by the City has been satisfied with an exhibit attached to the certificate presenting calculations prepared by the City and a Coverage Report evidencing that the debt service coverage requirements for the financing represented by the Series 2022 Bond are satisfied.
13. Verification Report addressed to the City and Authority, dated on or before the Closing Date, from Causey, Demgen & Moore, P.C. (the “Verification Agent”), verifying the accuracy of the mathematical computations concerning the adequacy of the moneys to be deposited in the Escrow Fund under the Escrow Agreement to pay when due pursuant to the stated maturity or call for redemption the principal of and interest with respect to the Prior Bonds.
14. CDIAC reports with respect to the sale of the Series 2022 Bond required to be delivered to the California Debt and Investment Advisory Committee pursuant to Sections 53583 and 8855 of the California Government Code.
15. Such additional legal opinions, certificates, instruments or evidences thereof and other documents as Co-Bond Counsel and Original Purchaser's counsel may reasonably deem necessary.
SC356380 03498-803
SECOND SUPPLEMENTAL TRUST AGREEMENT
between the
WOODLAND FINANCE AUTHORITY
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee Dated May 1, 2022
relating to
$[PRINCIPAL AMOUNT]
WOODLAND FINANCE AUTHORITY
(California)
WASTEWATER REVENUE BOND, REFUNDING SERIES 2022
(FEDERALLY TAXABLE CONVERTIBLE)
(supplemental to the Trust Agreement dated March 1, 2014, and the First Supplemental Trust Agreement dated March 1, 2014)
SC356380 03498-803i
SECOND SUPPLEMENTAL TRUST AGREEMENT
WOODLAND FINANCE AUTHORITY
(California)
WASTEWATER REVENUE BOND, REFUNDING SERIES 2022
(FEDERALLY TAXABLE CONVERTIBLE)
TABLE OF CONTENTS
I. Definitions............................................................................................................................2 II. Supplemental Provisions......................................................................................................3 ARTICLE XIII THE SERIES 2022 BOND ........................................................................3 Section 13.01.Terms and Form of Series 2022 Bond .............................................3 Section 13.02.Transfer of Bond..............................................................................5 Section 13.03.Redemption of Series 2022 Bond ....................................................5 Section 13.04.Application of Series 2022 Bond Proceeds .....................................6 Section 13.05.Costs of Issuance Fund ....................................................................7 Section 13.06.Validity of Series 2022 Bond...........................................................7 Section 13.07.Role of the Original Purchaser.........................................................7 Section 13.08.Additional Provisions and Rights so long as Series 2022 Bond held by the Original Purchaser...............................................7 Section 13.09.Procedures for Conversion...............................................................8 III. Provisions of the Trust Agreement ......................................................................................9 IV. Separability of Invalid Provisions......................................................................................10 V. Effect of Headings and Table of Contents.........................................................................10 VI. Waiver of Jury Trial; Agreement for Judicial Reference; No Sovereign Immunity..........10 VII. Execution in Counterparts..................................................................................................10 Exhibit A Form of Series 2022 Bond .........................................................................................A-1 Exhibit B Form of Original Purchaser’s Letter of Representations............................................B-1 Exhibit C Form of Subsequent Purchaser’s Letter of Representations.......................................C-1
SC356380 03498-8031Second Supplemental Trust Agreement
SECOND SUPPLEMENTAL TRUST AGREEMENT
This Second Supplemental Trust Agreement (this “Second Supplement”), dated May 1, 2022, between U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION (as successor-in- interest to U.S. Bank National Association), as trustee, a national banking association duly organized and existing under and by virtue of the laws of the United States of America (the “Trustee”), and the WOODLAND FINANCE AUTHORITY (the “Authority”), a joint exercise of powers agency duly created and existing pursuant to the laws of the State of California and an agreement entitled “Joint Exercise of Powers Agreement” between the City of Woodland (the “City”) and the Redevelopment Agency of the City of Woodland; W I T N E S S E T H:
WHEREAS, the City has determined that the issuance by the Authority of bonds under the Trust Agreement dated March 1, 2014 (as thereafter amended and supplemented, the “Trust Agreement”), between the Authority and the Trustee to refinance improvements to the City’s sewage and wastewater conveyance, treatment, and disposal system (the “Wastewater System”) will result in significant public benefits;
WHEREAS, pursuant to the Trust Agreement, the Authority issued its Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien) (the “Prior Bonds”) to finance and refinance the costs of certain public capital improvements to the City’s Wastewater System; WHEREAS, the Authority has determined to issue its Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) (the “Series 2022 Bond”), in the principal amount of $[PRINCIPAL AMOUNT] to refund the outstanding Prior Bonds maturing on and after March 1, 2025 (the “Refunded Prior Bonds”);
WHEREAS, the Authority has determined to enter into this Second Supplement in order to provide for the issuance of the Series 2022 Bond, to establish and declare the terms and conditions upon which the Series 2022 Bond shall be delivered and secured and to secure the payment of the principal thereof and the premium (if any) and interest thereon; WHEREAS, all acts, conditions, and things required by law to exist, to have happened, and to have been performed to make the Series 2022 Bond, when executed by the Authority, authenticated and delivered by the Trustee and duly issued, the valid, binding and legal obligations of the Authority payable in accordance with its terms, and to constitute this Second Supplement a valid and binding agreement of the parties hereto for the uses and purposes herein set forth in accordance with its terms, do exist, have happened, and have been performed in regular and due time, form, and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this Second Supplement;
NOW, THEREFORE, the parties hereto agree as follows:
SC356380 03498-8032Second Supplemental Trust Agreement I. Definitions. Capitalized terms used herein and not defined herein shall have the definitions ascribed to such terms by the Trust Agreement. Unless the context otherwise requires, the additional terms defined below shall for all purposes hereof and of any amendment hereof or supplement hereto and any certificate, opinion, or other document herein mentioned have the meanings specified herein.
Bond Year for the Series 2022 Bond, for purposes of Section 148 of the Internal Revenue Code and the Treasury Regulations promulgated thereunder, means the period ending on March 1 of each year with the first Bond Year ending on March 1, 2023, and the last Bond Year ending on the date on which the Bond is no longer outstanding.
Change in Redemption Notice means a written notice from the Owner choosing the redemption provision.
Conversion Date means the date upon which the Authority effects the change to convert the interest rate payable with respect to the Series 2022 Bond to the Tax-Exempt Rate.
Default Rate means at the time of the Event of Default, the applicable Taxable Rate or the Tax-Exempt Rate.
Event of Taxability means a determination, decision, or decree made by the Commissioner or any District Director of the Internal Revenue Service, or by any court of competent jurisdiction, that the interest on the Bond is includable in gross income for federal income tax purposes because of an action or omission of the Authority or the City; Escrow Agent means U.S. Bank Trust Company, National Association.
Escrow Agreement means the escrow agreement by and between the City and the Escrow Agent dated as of May 1, 2022, for the Refunded Prior Bonds.
Second Supplemental Installment Purchase Contract means the Second Supplemental Installment Purchase Contract dated May 1, 2022, between the City and the Authority.
Installment Purchase Contract means the Installment Purchase Contract dated March 1, 2014, between the Authority and the City, as originally executed and as it may from time to time be amended or supplemented pursuant to the provisions hereof and thereof.
Letter of Representations means a letter substantially (i) in the form attached hereto as Exhibit B delivered to the Authority by the Original Purchaser of the Series 2022 Bond, and (ii) in the form attached hereto as Exhibit C delivered to the Authority by any subsequent purchaser of the Series 2022 Bond.
Original Purchaser means Webster Bank, National Association and its successors and assigns.
Refunded Prior Bonds means the Authority’s Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien), maturing on and after March 1, 2025.
SC356380 03498-8033Second Supplemental Trust Agreement Series 2022 Bond means the Woodland Finance Authority Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) issued hereunder.
Series 2022 Installment Payments means the installment payments of interest and principal and the redemption premiums, if any, payable by the City under and pursuant to the Installment Purchase Contract as supplemented by the Second Supplemental Installment Purchase Contract with respect to the Series 2022 Bond and described in Section 10.3 (Installment Payments) thereof.
Taxable Rate means 3.60% per annum.
Tax-Exempt Rate means 2.845% per annum.
2022 Purchase Price means the principal amount plus interest thereon owed by the City to the Authority under the terms of the Second Supplemental Installment Purchase Contract to refund the Refunded Prior Bonds.
II. Supplemental Provisions. The following Article and Sections are here by added to the Trust Agreement.
ARTICLE XIII
THE SERIES 2022 BOND
Section 13.01.Terms and Form of Series 2022 Bond.
(A) Creation of Series 2022 Bond. The Authority hereby creates a Third Series of Bonds and additionally designates it “Refunding Series 2022 (Federally Taxable Convertible).” At any time after the execution and delivery of this Second Supplement, the Authority may execute and the Trustee shall authenticate and deliver the Series 2022 Bond in the aggregate principal amount of $[Principal Amount] upon the Order of the Authority. (B) Form of Series 2022 Bond. The Series 2022 Bond shall be issued in the form of a single, fully-registered installment bond in substantially the form attached hereto as Exhibit A with such insertions, omissions, substitutions, and variations as may be determined by the officers executing the same, as evidenced by their execution thereof, to reflect the applicable terms of the Series 2022 Bond established by this Article. The Series 2022 Bond shall be registered initially in the name of the Original Purchaser and shall not be delivered in book-entry form. (C) Date; Interest Accrual; Interest Rates; Payment Dates.
The Series 2022 Bond shall be dated its date of delivery and shall bear interest from its date. Prior to the Conversion Date, the Series 2022 Bond shall bear interest at the Taxable Rate.
After the Conversion Date, the Series 2022 Bond shall bear interest at the Tax-Exempt Rate.
Interest on the Series 2022 Bond shall be payable on March 1, 2023, and thereafter semiannually on March 1 and September 1 of each year while the Series 2022 Bond is Outstanding. Interest on the Series 2022 Bond shall be calculated on the basis of a 360-day year comprising twelve 30-day months. The Authority shall pay installments of principal on the Bond in the following amounts on the following dates (subject to prior redemption as described below):
SC356380 03498-8034Second Supplemental Trust Agreement Date
(March 1)
Principal
Amount
Date
(March 1)
Principal
Amount
(D) Principal and Interest Payments. The principal or Redemption Price of and interest on the Series 2022 Bond shall be payable in lawful money of the United States of America by wire transfer in immediately available funds on each Interest Payment Date to the Owner as of the close of business on the Regular Record Date, in accordance with such wire transfer instructions as are filed by the Owner with the Trustee from time to time. The Regular Record Date for the Series 2022 Bond is the fifteenth (15th) day of the calendar month immediately preceding the relevant Interest Payment Date. Payments of principal of the Series 2022 Bond shall be made without the requirement for presentation and surrender of the Series 2022 Bond by the Owner, provided that principal that is payable at final maturity or the Redemption Price payable upon redemption in whole shall be made only upon presentation and surrender of the Series 2022 Bond at the Corporate Trust Office.
(E) Cessation of Interest Accrual. Interest on the Series 2022 Bond shall cease to accrue (i) on the final principal payment date, provided that there has been irrevocably deposited with the Trustee an amount sufficient to pay the principal amount thereof, plus interest accrued thereon to such date; or (ii) on the date of its redemption in whole, provided there has been irrevocably deposited with the Trustee an amount sufficient to pay the Redemption Price thereof, plus interest accrued thereon to such date. The Owner of the Series 2022 Bond shall not be entitled to any other payment, and the Series 2022 Bond shall no longer be Outstanding and entitled to the benefits of this Second Supplement, except for the payment of the purchase price, principal amount or Redemption Price, of such Series 2022 Bond, as appropriate, from moneys held by the Trustee for such payment.
(F) Event of Default. Upon the occurrence and continuation of an Event of Default, the unpaid principal balance of the Bond shall, if elected by the Owner, bear interest at a rate per annum not greater than the Default Rate to the extent such increased rate is permitted by law. The Owner shall notify the Trustee of its election and the rate per annum to be applied as the Default Rate. If so imposed by the Owner, the Default Rate shall remain in effect until such time as the applicable Event of Default is cured to the satisfaction of the Owner. Any unpaid interest on the Bond, including Default Rate interest, shall accrue until paid. (G) Interest Rate Following an Event of Taxability. After the Conversion Date, upon the occurrence of an Event of Taxability, the unpaid principal balance of the Bond shall, if elected by the Owner, bear interest at the Taxable Rate to the extent such increased rate is permitted by
SC356380 03498-8035Second Supplemental Trust Agreement law. The Owner shall notify the Trustee of its election and the rate per annum to be applied as the Taxable Rate.
(H) Series Required Reserve. The Series Required Reserve for the Series 2022 Bond is zero dollars ($0.00).
Section 13.02.Transfer of Bond. The Owner may transfer the Series 2022 Bond in whole, but not in part, and only to a proposed transferee who is (i) an affiliate of the Owner, or (ii) banks, insurance companies, or other financial institutions or their affiliates that executes a Letter of Representations.
Transfer shall be made upon the books required to be kept pursuant to the provisions of Section 2.05 (Registration Transfer and Exchange) of the Trust Agreement, in person or by the duly authorized attorney of such person, upon surrender of the Series 2022 Bond to the Authority for cancellation, accompanied by delivery of a duly executed written instrument of transfer in a form approved by the Authority and the purchaser’s duly executed Letter of Representations.
Whenever the Series 2022 Bond shall be surrendered for transfer, the designated Authority officials shall execute, as provided in Section 2.04 (Execution, Authentication, Delivery, and Dating) of the Trust Agreement, and deliver a new Series 2022 Bond. The Authority shall require the payment by the Owner requesting any such transfer of any tax or other governmental charge required to be paid with respect to such transfer.
No transfer of the Series 2022 Bond shall be required to be made by the Authority during the period from the close of business on the Regular Record Date next preceding any Interest Payment Date to and including such Interest Payment Date.
Prior to any transfer of the Series 2022 Bond the transferor shall provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045, as amended. The Trustee shall conclusively rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.
Section 13.03.Redemption of Series 2022 Bond.
(A) General. The Series 2022 Bond is subject to redemption as provided in Article IV (Redemption of Bonds).
(B) Casualty Loss or Governmental Taking. The Series 2022 Bond is subject to redemption prior to maturity as a whole on any date or in part on any Interest Payment Date, from prepaid Installment Payments made by the City from funds received by the City due to a casualty loss, material title defect, or governmental taking of the Wastewater System or portions thereof by eminent domain proceedings, under the circumstances and upon the conditions and terms prescribed herein and in the Installment Purchase Contract, at a redemption price equal to the sum of the principal amount thereof plus accrued interest thereon to the date fixed for redemption, without premium.
SC356380 03498-8036Second Supplemental Trust Agreement (C) Optional Redemption.
(i) Pre-Conversion Date. The Series 2022 Bond is not subject to redemption at the option of the Authority prior to the Conversion Date. (ii) Post-Conversion. After the Conversion Date, the Series 2022 Bond will be subject to one of the following two optional redemption provisions, as specified by the Owner in its Change of Redemption Notice:
(1) The Series 2022 Bond is subject to redemption, at the option of the Authority as directed by the City, in whole, from any available source of funds, on any Interest Payment Date on or after March 1, 2026 at the following redemption prices (expressed as a percentage of the principal amount being redeemed):
Redemption Date Redemption Price
March 1, 2026 through September 1, 2027 102% March 1, 2028 through September 1, 2029 101 March 1, 2030 and thereafter 100
or
(2) The Series 2022 Bond is subject to redemption, at the option of the Authority as directed by the City, in whole, from any available source of funds, on any Interest Payment Date on or after March 1, 2024 at the following redemption prices (expressed as a percentage of the principal amount being redeemed):
Redemption Date Redemption Price
March 1, 2024 through September 1, 2025
March 1, 2026 through September 1, 2027
March 1, 2028 through September 1, 2029
March 1, 2030 and thereafter
103%
102
101
100
In any event, the Authority shall be required to give written notice of its intention to redeem the Series 2022 Bond at least thirty (30) days prior to the date fixed for such redemption in accordance with the requirements of Article IV (Redemption of Bonds).
Section 13.04.Application of Series 2022 Bond Proceeds. The proceeds of the sale of the Series 2022 Bond shall be deposited with the Trustee and shall be set aside or transferred by the Trustee as follows:
(i) transfer $_____________ to the Escrow Agent for deposit into the Escrow Fund established pursuant to the Escrow Agreement;
(ii) deposit $____________ into the Costs of Issuance Fund.
SC356380 03498-8037Second Supplemental Trust Agreement The Trustee may establish a temporary fund or account in its records to facilitate such deposits or transfers.
Section 13.05.Costs of Issuance Fund.
(A) The Trustee shall disburse funds from the Costs of Issuance Fund, which is hereby established, to pay Costs of Issuance only upon receipt of a signed requisition (stating the amount to be disbursed and the party or parties being paid) approved by the Authorized Officer of the Authority and accompanied by an invoice or statement for each such amount. (B) Upon payment of all Costs of Issuance (which include CDIAC fees), or upon the date occurring four (4) months after the Closing Date, whichever occurs first, the Trustee shall transfer all funds remaining in the Costs of Issuance Fund to the Reserve Fund, and the Costs of Issuance Fund shall thereupon be closed.
Section 13.06.Validity of Series 2022 Bond. The recital in the Series 2022 Bond that it is delivered pursuant to the constitution and statutes of the State shall be conclusive evidence of its validity and of compliance with provisions of law in its issuance and delivery.
Section 13.07.Role of the Original Purchaser. The Authority acknowledges and agrees that (i) the purchase of the Series 2022 Bond by the Original Purchaser is an arm’s-length commercial transaction between the Authority and the Original Purchaser and its affiliates, (ii) in connection with such transaction, the Original Purchaser and its affiliates are acting solely as a principal and not as a fiduciary or agent of the Authority, nor as an advisor to the Authority, including, without limitation, a “Municipal Advisor” as such term is defined in Section 15B of the Securities and Exchange Act of 1934, as amended, and in related rules (17 CFR Parts 200, 240, 249), (iii) the Original Purchaser and its affiliates are relying on the bank exemption in the such rule, (iv) the Original Purchaser and its affiliates have not provided any advice or assumed any advisory or fiduciary responsibility in favor of the Authority with respect to the transactions contemplated hereby and the discussions, undertakings and procedures leading thereto (whether or not the Original Purchaser, or any affiliate of the Original Purchaser, have provided other services or advised, or is currently providing other services or advising the Authority on other matters), (v) the Original Purchaser and its affiliates have financial and other interests that differ from those of the Authority, and (vi) the Authority has consulted with its own financial, legal, accounting, tax and other advisors, as applicable, to the extent it deemed appropriate.
Section 13.08.Additional Provisions and Rights so long as Series 2022 Bond held by the Original Purchaser. The following provisions apply so long as the Original Purchaser is the Owner of the Series 2022 Bond:
(A) Notwithstanding any other provision of this Second Supplement, the Original Purchaser has the right to consent to any amendment of this Second Supplement and to the removal and replacement of the Trustee.
(B) The Original Purchaser is hereby expressly made a third party beneficiary of this Second Supplement.
SC356380 03498-8038Second Supplemental Trust Agreement (C) The Authority shall notify the Original Purchaser of any failure of the Authority to provide relevant notices, certificates or other similar documents. (D) The Authority shall pay or reimburse the Original Purchaser for any and all charges, fees, costs and expenses that the Original Purchaser may reasonably pay or incur in connection with the following: (i) the administration, enforcement, defense, or preservation of any rights or security hereunder or under this Second Supplement; (ii) the pursuit of any remedies hereunder, under this Second Supplement, or otherwise afforded by law or equity; (iii) any amendment, waiver, or other action with respect to or related to this Second Supplement whether or not executed or completed; (iv) the violation by the Authority of any law, rule, or regulation or any judgment, order or decree applicable to it; or (v) any litigation or other dispute in connection with this Second Supplement.
(E) The Series 2022 Bond shall not be rated, shall not have a CUSIP number, shall not be issued pursuant to an offering document, and shall be registered in the name of the Original Purchaser.
(F) Except as otherwise provided in the Installment Purchase Contract, the Authority shall not supplement, amend, modify or terminate any of the terms of the Installment Purchase Contract, or consent to any such supplement, amendment, modification or termination, without the written consent of the Trustee and the Owner
(G) Except as otherwise provided therein, the Trust Agreement and the rights and obligations of the Authority, of the Trustee, and the Owner may be modified or amended from time to time and at any time by a Supplemental Trust Agreement, which the Authority and the Trustee may enter into with the consent of the Owner, in its absolute discretion, which consent shall not be unreasonably withheld, and with the consent of the City and only to the extent permitted by law.
Section 13.09.Procedures for Conversion.
(A) Option to Convert Interest Rate. The Authority has the right, subject to the satisfaction of the conditions provided herein, at any time on or after December 5, 2023, to convert the interest rate payable on the Series 2022 Bond to the Tax-Exempt Rate. If the Authority elects to convert the Series 2022 Bond, the Owner of the Series 2022 Bond shall select one of the two optional redemption provisions described in Section 13.03(C). (B) Notice of Proposed Conversion Date. The Authority shall provide written notice of its election to convert the interest rate on the Series 2022 Bond and the proposed Conversion Date to the Owner and the Trustee at least sixty (60) days (but not sooner than nine months) prior to the proposed Conversion Date, which notice shall state:
(i) that the interest rate on the Series 2022 Bond will be converted to the Tax- Exempt Rate on the Conversion Date, subject to the delivery of the items required by subsection (C) below on or prior to the Conversion Date; (ii) that the Owner of the Series 2022 Bond shall exercise its option to choose one of two optional redemption provisions for the Series 2022 Bond as provided Section 13.03(C)
SC356380 03498-8039Second Supplemental Trust Agreement by delivering to the Authority and the Trustee not less than thirty (30) days prior to the proposed Conversion Date the Owner’s Change in Redemption Notice. (C) Items Required for Conversion to the Tax-Exempt Rate. On or prior to the Conversion Date, there shall be filed with or delivered to the Trustee, the Owner, and the Authority:
(i) a copy, duly certified by the Secretary of the Board, of the resolution adopted and approved by the Board authorizing the conversion of the interest rate on the Series 2022 Bond to the Tax-Exempt Rate;
(ii) appropriate amendments or supplements, if any, to this Second Supplement and the Series 2022 Bond, in form acceptable to the Owner; (iii) a Tax Certificate dated the Conversion Date and delivered by the Authority with respect to certain tax matters related to the Series 2022 Bond, in form acceptable to the Owner; (iv) Form 8038-G and evidence of filing such form with the United States Department of Treasury;
(v) an opinion of Kronick, Moskovitz, Tiedemann & Girard, a Professional Corporation, Sacramento, California, and Lozano Smith, LLP, Sacramento, California, as co-bond counsel, or any other municipal bond attorney or firm of municipal bond attorneys approved by the Authority (“Qualified Bond Counsel”) to the effect that the conditions precedent set forth herein to the conversion of the interest rate on the Series 2022 Bond to the Tax-Exempt Rate have been satisfied, that the Series 2022 Bond is valid and legally binding upon the Authority, and that the interest on the Series 2022 Bond accruing after the Conversion Date is excludable from gross income of the Owner thereof for federal income tax purposes under Section 103 of the Code, or any legislation enacted in replacement thereof, assuming continuing compliance by the Authority with certain covenants, together with reliance letters addressed to the Trustee and the Owner. (D) New Series 2022 Bond and Bond Opinion . Promptly after the Conversion Date for the Series 2022 Bond, the Owner shall turn in the Series 2022 Bond in its possession to the Trustee and the Trustee shall promptly mail to the Owner of the Series 2022 Bond a new Series 2022 Bond at the Tax-Exempt Rate and which shall include a copy of the opinion of Qualified Bond Counsel delivered on the Conversion Date and optional redemption provisions in form acceptable to the Owner.
III. Provisions of the Trust Agreement. Except as in this Second Supplement expressly provided, every term and condition contained in the Trust Agreement shall apply to this Second Supplement and to the Series 2022 Bond with the same force and effect as if the same were herein set forth at length, with such omissions, variations and modifications thereof as may be appropriate to make the same conform to this Second Supplement.
This Second Supplement and all the terms and provisions herein contained shall form part of the Trust Agreement as fully and with the same effect as if all such terms and provisions had been set forth in the Trust Agreement. The Trust Agreement is hereby ratified and confirmed and
SC356380 03498-80310Second Supplemental Trust Agreement shall continue in full force and effect in accordance with the terms and provisions thereof, as supplemented and amended hereby.
IV. Separability of Invalid Provisions. If any one or more of the provisions contained in this Second Supplement or in the Series 2022 Bond shall for any reason be held to be invalid, illegal, or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Second Supplement and such invalidity, illegality, or unenforceability shall not affect any other provision of this Second Supplement, and this Second Supplement shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The Authority and the Trustee each hereby declares that it would have adopted this Second Supplement and each and every other Section, paragraph, sentence, clause, or phrase hereof and authorized the execution and delivery of the Series 2022 Bond pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Second Supplement may be held illegal, invalid, or unenforceable.
V. Effect of Headings and Table of Contents. The headings or titles of the several Sections hereof, and any table of contents appended to copies hereof, shall be solely for convenience of reference and shall not affect the meaning, construction, or effect of this Second Supplement.
VI. Waiver of Jury Trial; Agreement for Judicial Reference; No Sovereign Immunity. To the fullest extent permitted by law, the Authority hereby waives its right to trial by jury in any action, proceeding and/or hearing on any matter whatsoever arising out of, or in any way connected with, the Series 2022 Bond or this Second Supplement or any documents relating to the Series 2022 Bond or this Second Supplement, or the enforcement of any remedy under any law, statute, or regulation. To the extent such waiver is not enforceable, the Authority hereby consents to the adjudication of any and all such matters pursuant to Judicial Reference as provided in Section 638 of the California Code of Civil Procedure, and the judicial referee shall be empowered to hear and determine any and all issues in such Reference whether fact or law. The Authority hereby represents that it does not possess and will not invoke a claim of sovereign immunity for disputes arising out of contractual claims relating to the Series 2022 Bond or this Second Supplement. The Trustee shall in no event be required to participate in any judicial reference proceeding as described in the foregoing sentence hereunder.
VII. Execution in Counterparts. This Second Supplement may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument.
[Signature page follows]
SC356380 03498-803 Signature Page to Second Supplemental Trust Agreement IN WITNESS WHEREOF, the parties hereto have executed this Second Supplemental Trust Agreement by their officers thereunto duly authorized as of the day and year first written above.
WOODLAND FINANCE AUTHORITY
By:
Ken Hiatt, Administrator
ATTEST:
Ana B. Gonzalez, Secretary
U.S. BANK TRUST COMPANY,
NATIONAL ASSOCIATION, as Trustee
By:
Authorized Officer
SC356380 03498-803A-1Second Supplemental Trust Agreement
EXHIBIT A
FORM OF SERIES 2022 BOND
REGISTERED REGISTERED
WOODLAND FINANCE AUTHORITY
WASTEWATER REVENUE BOND, REFUNDING SERIES 2022
(FEDERALLY TAXABLE CONVERTIBLE)
ORIGINAL
PRINCIPAL
AMOUNT
TAXABLE
INTEREST RATE
PER ANNUM
TAX-EXEMPT
INTEREST RATE
PER ANNUM
ORIGINAL ISSUE
DATE
$[PRINCIPAL
AMOUNT]
3.60% 2.845% [closing date]
REGISTERED OWNER: Webster Bank, National Association
PRINCIPAL SUM: _______________________________ DOLLARS
The WOODLAND FINANCE AUTHORITY, a joint exercise of powers agency duly organized and validly existing under and pursuant to the laws of the State of California (the “Authority”), for value received hereby, promises to pay (but only out of the Revenues hereinafter referred to) to the registered owner identified above or registered assigns, the installments of principal in the amounts and on the dates stated below and interest on the unpaid principal amount of this Bond calculated from the original issue date stated above at the applicable interest rate per annum stated above (subject to increase to the Default Rate as described below) payable on March 1, 2023, and semiannually thereafter on each March 1 and September 1:
Date
(March 1)
Principal
Amount
Date
(March 1)
Principal
Amount
Interest on the unpaid principal amount of this Bond is calculated on the basis of a 360-day year comprising twelve 30-day months. The installments of principal of and interest on this Bond shall be payable in lawful money of the United States of America by wire transfer on each payment date to the registered owner hereof (in accordance with the terms of the Trust Agreement described below).
SC356380 03498-803A-2Second Supplemental Trust Agreement The Authority has duly authorized the issuance of this Bond, has designated it as its Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) (the “Bond”), and has issued it in the original principal amount stated above. This Bond is issued under and pursuant to the provisions of the Joint Exercise of Powers Act (being Chapter 5 of Division 7 of Title 1 of the California Government Code, as amended) and all laws amendatory thereof or supplemental thereto (the “Act”) and under and pursuant to the provisions of a trust agreement, as supplemented by the first supplemental trust agreement, both dated March 1, 2014, and the second supplemental trust agreement dated May 1, 2022, all of which are between the Authority and the Trustee (collectively, the “Trust Agreement”), copies of which are on file at the corporate trust office of the Trustee.
This Bond is issued to provide funds to refinance the cost of the acquisition, construction and equipping of water supply system facilities for the City of Woodland (the “City”). The Bond is a limited obligation of the Authority and is payable, as to interest thereon and principal thereof, solely from certain proceeds of the Bond held in certain funds and accounts pursuant to the Trust Agreement and the revenues (the “Revenues”) derived from Installment Payments and other payments made by the City pursuant to an installment purchase contract, as supplemented by the first supplemental installment purchase contract, both dated March 1, 2014, and as further supplemented by the second supplemental installment purchase contract dated May 1, 2022, all of which are between the City and the Authority (collectively the “Installment Purchase Contract”).
The Authority is not obligated to pay interest on and principal of the Bond except from the Revenues. The Bond is secured in accordance with the terms and conditions of the Trust Agreement by a pledge of and charge and lien upon the Revenues. The Revenues constitute a trust fund for the security and payment of the interest on and principal of the Bond as provided in the Trust Agreement.
The full faith and credit of the Authority and the City are not pledged for the payment of the interest on or principal of the Bond. No tax shall ever be levied or collected to pay the interest on or principal of the Bond. The Bond is not secured by a legal or equitable pledge of or charge or lien upon any property of the Authority or any of its income or receipts except the Revenues.
Neither the payment of the interest on nor principal of the Bond is a debt, liability or general obligation of the Authority.
Reference is hereby made to the Act and to the Trust Agreement and any and all amendments thereof and supplements thereto for a description of the terms on which the Bond is issued, the provisions with regard to the nature and extent of the Revenues, the rights of the registered owner of the Bond, security for payment of the Bond, remedies upon default and limitations thereon, and amendment of the Trust Agreement (with or without consent of the registered owner of the Bond). All the terms of the Trust Agreement are hereby incorporated herein and constitute a contract between the Authority and the registered owner of this Bond. The registered owner of this Bond, by acceptance hereof, agrees and consents to all the provisions of the Trust Agreement.
The Series 2022 Bond is not subject to redemption at the option of the Authority prior to the Conversion Date.
If an event of default, as defined in the Trust Agreement, occurs, the principal of the Bond may be declared due and payable upon the conditions, in the manner and with the effect provided in the Trust Agreement, except that the Trust Agreement provides that in certain events such
SC356380 03498-803A-3Second Supplemental Trust Agreement declaration and its consequences may be rescinded under the circumstances as provided therein and the Default Rate shall apply.
This Bond is transferable by the registered owner hereof, in person or by its attorney duly authorized in writing, at the corporate trust office of the Trustee, but only in the manner, subject to the limitations, and upon payment of the charges provided in the Trust Agreement, and upon surrender and cancellation of this Bond. Upon such transfer, a new fully registered Bond for the same principal amount will be issued to the transferee in exchange herefor.
The Authority, the Trustee, and any paying agent may deem and treat the registered owner hereof as the absolute owner hereof for all purposes; and the Authority, the Trustee, and any paying agent shall not be affected by any notice to the contrary.
This Bond is not entitled to any benefit, protection or security under the Trust Agreement or become valid or obligatory for any purpose until the certificate of authentication attached hereto has been executed and dated by the Trustee.
The rights and obligations of the Authority and of the registered owner of the Bond may be modified or amended at any time in the manner, to the extent, and upon terms provided in the Trust Agreement, which provide, in certain circumstances, for modifications and amendments without the consent of or notice to the registered owner of the Bond.
The Authority hereby certifies and recites that any and all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in the issuance of this Bond do exist, have happened and have been performed in due time, form and manner as required by law and that the amount of this Bond, together with all other indebtedness of the Authority, does not exceed any limit prescribed by the Constitution or laws of the State of California and is not in excess of the amount of Bonds permitted to be issued under the Trust Agreement.
SC356380 03498-803A-4Second Supplemental Trust Agreement IN WITNESS WHEREOF, the Woodland Finance Authority has caused this Bond to be executed in its name and on its behalf by the President of the Authority and countersigned by the Secretary of the Authority, and has caused this Bond to be dated as of the original issue date specified above.
WOODLAND FINANCE AUTHORITY
By:
President of the Authority
Countersigned:
Secretary of the Authority
SC356380 03498-803A-5Second Supplemental Trust Agreement
CERTIFICATE OF AUTHENTICATION
This is the Bond described in the within mentioned Trust Agreement which has been authenticated on _________________, 2022.
U.S. Bank Trust Company, National
Association, as Trustee
By:
Authorized Officer
SC356380 03498-803A-6Second Supplemental Trust Agreement
ASSIGNMENT
For value received the undersigned do(es) hereby sell, assign and transfer unto ____________________________________________________ the within Bond and do(es) hereby irrevocably constitute and appoint ______________________________________ attorney, to transfer the same on the bond register of the Trustee, with full power of substitution in the premises.
Dated:
Note: The signature(s) to this Assignment must correspond with the name(s) on the face of the within Bond in every particular, without alteration or enlargement or any change whatsoever.
Signature(s) Guaranteed by:
Note: Signature must be guaranteed by an eligible guarantor institution (banks, securities brokers, savings associations, credit unions, or other institutions with membership in an approved signature guarantee medallion program) pursuant to Securities and Exchange Commission Rule 17A(d)15.
Social Security Number, Tax Identification
Number, or other identifying number of
Assignee:
SC356380 03498-803A-7Second Supplemental Trust Agreement
LEGAL OPINION
I hereby certify that the following is a true and correct copy of the legal opinion relating to the Bond described therein that was manually signed by Kronick, Moskovitz, Tiedemann & Girard and Lozano Smith, LLP and was dated the date of delivery and payment of said Bond.
Secretary of the Authority
KRONICK, MOSKOVITZ, TIEDEMANN &
GIRARD
A Professional Corporation
1331 Garden Hwy, 2nd Floor
Sacramento, CA 95833
LOZANO SMITH, LLP
One Capitol Mall, Suite 640
Sacramento, CA 95814
Members of the Board
Woodland Finance Authority
300 First Street
Woodland, California 95695
Re:Woodland Finance Authority
Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) (Final Opinion of Co-Bond Counsel)
Ladies and Gentlemen:
[INSERT OPINION]
SC356380 03498-803B-1Second Supplemental Trust Agreement
EXHIBIT B
FORM OF ORIGINAL PURCHASER’S LETTER OF REPRESENTATIONS
[Closing Date]
Woodland Finance Authority
300 First Street
West Sacramento, CA 95695
[PLACEMENT AGENT]
Re: $[PRINCIPAL AMOUNT]
Woodland Finance Authority
Wastewater Revenue Bond, Refunding Series 2022
(Federally Taxable Convertible) (the “Bonds”)
Ladies and Gentlemen:
The undersigned, [PURCHASER] (the “Purchaser”) hereby represents and warrants to you as follows:
1. The Purchaser has purchased on the date hereof at the price of par, with no accrued interest [PRINCIPAL AMOUNT] in par amount of the above-referenced bond (the “Bond”) issued by the Woodland Finance Authority (the “Authority”), pursuant to the Trust Agreement, supplemented by the First Supplemental Trust Agreement, both dated March 1, 2014, and as further supplemented by the Second Supplemental Trust Agreement dated May 1, 2022 (as so supplemented, the “Trust Agreement”), between the Authority and U.S. Bank Trust Company, National Association (as successor-in-interest to U.S. Bank National Association), as trustee, and the Second Supplemental Installment Purchase Contract, dated May 1, 2022, between the City of Woodland (the “City”) and the Authority.
2. The Purchaser has sufficient knowledge and experience in business and financial matters in general, and extensions of credit such as the Bond in particular, to enable the Purchaser to evaluate the Bond, the credit of the City, the collateral and the terms of the Bond and that the Purchaser has made its own independent credit analysis and decision to purchase the Bond based on independent examination and evaluation of the transaction and the information deemed appropriate, without reliance on [PLACEMENT AGENT], as placement agent (the “Placement Agent”), or its affiliates, directors, officers, employees, attorneys or agents.
3. The Purchaser acknowledges that no credit rating has been sought or obtained with respect to the Bond.
SC356380 03498-803B-2Second Supplemental Trust Agreement
4. The Purchaser acknowledges that no official statement has been prepared for the Bond, and that the Authority will not be entering into a continuing disclosure agreement to provide ongoing disclosure respecting the Bond. The Purchaser has been offered copies of or full access to all documents relating to the Bond and all records, reports, financial statements and other information concerning the Authority and pertinent to the source of payment for the Bond as deemed material by the Purchaser, which the Purchaser as a reasonable lender, has requested and to which the Purchaser, as a reasonable lender, would attach significance in making a lending decision.
5. The Purchaser confirms that its extension of credit through purchase of the Bond constitutes a loan that is suitable for and consistent with its loan program and that the Purchaser is able to bear the economic risk of an extension of credit through purchase of the Bond, including a complete loss thereof.
6. The Purchaser states that: (a) it is a bank, savings and loan association, insurance company, or registered investment company; or an investment adviser registered either with the Securities and Exchange Commission under Section 203 of the Investment Advisers Act of 1940 or with a state securities commission (or any agency or office performing like functions); or any other entity (whether a natural person, corporation, partnership, trust, or otherwise) with total assets of at least $50 million; (b) it is (i) an “accredited investor” within the meaning of Rule 501(a)(1) of Regulation D under the Securities Act of 1933, as amended (the “1933 Act”) or (ii) a “Qualified Institutional Buyer” as defined in Rule 144A under the 1933 Act; (c) it is capable of evaluating investment risks and market value independently, both in general and with regard to transactions and lending strategies in municipal securities; (d) it is exercising independent judgment in evaluating: (i) the recommendation of the Placement Agent, if any, or its associated persons; and (ii) the quality of execution of the Purchaser’s transactions by the Placement Agent; and (e) it has timely access to material information that is available publicly through established industry sources as defined in Municipal Securities Rulemaking Board (MSRB) Rule G-471.
7. The Purchaser is purchasing the Bond solely for its own account, with a present intent to hold the Bond until maturity, or early redemption, other than participation in full to an affiliate, and not with a view to, or in connection with, any distribution, resale, pledging, fractionalization, subdivision or other disposition thereof (subject to the understanding that disposition of the Purchaser’s property will remain at all times within its control).
8. The Purchaser understands that the Bond (i) has not been registered under the Securities Act of 1933, as amended (the “Act”), and (ii) has not been registered or qualified under any state securities or “Blue Sky” laws, and that the Trust Agreement or any other related documents have not been qualified under the Trust Indenture Act of 1939. as amended.
9. The Purchaser acknowledges that in connection with the offering of the Bond: (i) the Placement Agent, has acted at arm’s length, is not an agent or financial advisor of, and owes 1 Pursuant to MSRB Rule G-47 established industry sources shall include the MSRB’s Electronic Municipal Market Access(“EMMA”®) system, rating agency reports, and other sources of information relating to municipal securities transactions generally used by brokers, dealers, and municipal securities dealers that effect transactions in the type of municipal securities at issue.
SC356380 03498-803B-3Second Supplemental Trust Agreement no fiduciary duties to the Purchaser or any other person irrespective of whether the Placement Agent has advised or is advising the Purchaser on other matters, and (ii) the Purchaser represents it has had the opportunity to consult with its own legal counsel and to negotiate this letter prior to execution. The Purchaser waives to the fullest extent permitted by law any claims it may have against the Placement Agent arising from an alleged breach of fiduciary duty in connection with the placement of the Bond.
10. The Purchaser understands that the Authority and the Placement Agent, and their respective counsel and Bond Counsel will rely upon the accuracy and truthfulness of the representations and warranties contained herein and hereby consents to such reliance.
11. The signatory of this letter is a duly authorized officer of the Purchaser with the authority to sign this letter on behalf of the Purchaser, and this letter has been duly authorized, executed, and delivered.
[PURCHASER]
By:
Authorized Officer
SC356380 03498-803C-1Second Supplemental Trust Agreement
EXHIBIT C
FORM OF SUBSEQUENT PURCHASER’S LETTER OF REPRESENTATIONS [Date]
Woodland Finance Authority
300 First Street
Woodland, CA 95695
Re: Woodland Finance Authority
Wastewater Revenue Bond, Refunding Series 2022
(Federally Taxable Convertible)
Ladies and Gentlemen:
The undersigned, [NAME OF TRANSFEREE] (the “Purchaser”), hereby represents and warrants to you as follows:
1. On the date hereof, the Purchaser has acquired the above-referenced bond (the “Bond”), in the outstanding principal amount of $[PRINCIPAL AMOUNT], issued by the Woodland Finance Authority (the “Authority”), pursuant to the Trust Agreement, supplemented by the First Supplemental Trust Agreement, both dated March 1, 2014, and as further supplemented by the Second Supplemental Trust Agreement dated May 1, 2022 (as so supplemented, the “Trust Agreement”), by and between the Authority and U.S. Bank, Trust Company, National Association (as successor-in-interest to U.S. Bank National Association), as trustee, and the Second Supplemental Installment Purchase Contract, dated May 1, 2022, between the City of Woodland (the “City”) and the Authority.
2. The Purchaser has sufficient knowledge and experience in business and financial matters in general, and investment obligations such as the Bond in particular, to enable the Purchaser to evaluate the Bond, the credit of the Authority, the collateral, and the terms of the Bond.
3. The Purchaser has made its own independent credit analysis and decision to purchase the Bond based on an independent examination and evaluation of the transaction and the information provided to the Purchaser by the Authority or its agents and deemed appropriate, without reliance on the Authority or its officers, employees, attorneys or agents.
4. The Purchaser acknowledges that no credit rating has been sought or obtained with respect to the Bond.
5. The Purchaser acknowledges that no official statement has been prepared for the Bond, and that the Authority will not be entering into a continuing disclosure agreement pursuant to SEC Rule 15c2-12 or otherwise to provide ongoing disclosure respecting the Bond. The Purchaser has been offered copies of or full access to all documents relating to the Bond and all
SC356380 03498-803C-2Second Supplemental Trust Agreement records, reports, financial statements and other information concerning the Authority and pertinent to the source of payment for the Bond as deemed material by the Purchaser that the Purchaser, as a reasonable investor, has requested, and to which the Purchaser, as a reasonable investor, would attach significance in making an investment decision.
6. The Purchaser confirms that its purchase of the Bond constitutes acquisition of an investment that is suitable and consistent with its investment program and that the Purchaser is able to bear the economic risk of an investment in the Bond, including a complete loss of such investment.
7. The Purchaser is purchasing the Bond solely for its own loan account and not with a present intent to, or in connection with, any distribution, resale, pledging, fractionalization, subdivision or other disposition thereof (subject to the understanding that disposition of Purchaser’s property will remain at all times within its control).
8. The Purchaser understands and agrees that ownership of the Bond may be transferred only in whole to a person or entity that executes a letter of representations substantially in the form of this letter.
9. The Purchaser understands that the Bond (i) has not been registered under the Securities Act of 1933, as amended (the “Act”), and (ii) has not been registered or qualified under any state securities or “Blue Sky” laws, and that the Trust Agreement has not been qualified under the Trust Indenture Act of 1939, as amended.
10. The Purchaser has been furnished with and has examined the Bond, the Trust Agreement, and other documents, certificates and the legal opinions delivered in connection with the issuance of the Bond.
11. The Purchaser understands that the Authority and its counsel will rely upon the accuracy and truthfulness of the representations and warranties contained herein and hereby consents to such reliance.
12. The signatory of this letter is a duly authorized officer of the Purchaser with the authority to sign this letter on behalf of the Purchaser, and this letter has been duly authorized, executed and delivered.
[PURCHASER]
By:
ESCROW AGREEMENT
between the
WOODLAND FINANCE AUTHORITY
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION
as Escrow Agent
Dated May 1, 2022
relating to the
refunding and defeasance of the
Woodland Finance Authority
Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien) (Issued March 13, 2014)
SC357950 03498-8032Escrow Agreement
ESCROW AGREEMENT
This ESCROW AGREEMENT (the “Escrow Agreement”), dated May 1, 2022, between the WOODLAND FINANCE AUTHORITY (the “Authority”), a joint powers authority duly established and existing under the laws of the State of California, and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION (the “Escrow Agent”), a national banking association duly organized and existing under and by virtue of the laws of the United States, and being qualified to accept and administer the trust hereby created as escrow agent, and in its capacity as trustee (the “Trustee”), under the Trust Agreement dated March 1, 2014 (as thereafter amended and supplemented, the “Trust Agreement”), between the Authority and the U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION (successor-in-interest to U.S. Bank National Association).
WITNESSETH:
WHEREAS, the Authority issued $33,825,000 aggregate principal amount of its “Woodland Finance Authority Wastewater Revenue Bonds, Refunding Series 2014 (Junior Lien)” (the “Prior Bonds”) pursuant to the Trust Agreement;
WHEREAS, the Authority has determined to refund and defease the outstanding Prior Bonds maturing on and after March 1, 2025 (the “Refunded Bonds”), and has issued its Woodland Finance Authority Wastewater Revenue Bond, Refunding Series 2022 (Federally Taxable Convertible) (the “Series 2022 Bond”), pursuant to the Trust Agreement dated March 1, 2014, as supplemented by the First Supplemental Trust Agreement dated March 1, 2014, and the Second Supplemental Trust Agreement dated May 1, 2022, by and between the Authority and the Trustee, to provide the funds necessary for that purpose;
WHEREAS, the Authority has taken action to cause to be made available for purchase by the Escrow Agent, from amounts on deposit in the Escrow Fund (as defined herein), certain [direct noncallable United States Treasury obligations] (the “Escrow Securities”), listed on Schedule I attached hereto, in an aggregate principal amount that, together with the money deposited in the Escrow Fund at the same time as such deposit and the income to accrue on such securities, will be sufficient to pay (i) the interest coming due on the Refunded Bonds, and (ii) the redemption price of the Refunded Bonds maturing on or after March 1, 2025, on March 1, 2024; WHEREAS, the provisions of the Trust Agreement are incorporated herein by reference as if set forth herein in full;
NOW, THEREFORE, the Authority and the Escrow Agent hereby agree as follows:
Section 1. Escrow Fund.
(a) Establishment and Funding of Escrow Fund. The Escrow Agent agrees to establish and maintain the Escrow Fund (the “Escrow Fund”) until all the Refunded Bonds have been redeemed as provided herein. The Escrow Agent shall, except as provided in Section 3 hereof, hold the Escrow Securities and the money (whether constituting the initial deposit in the Escrow Fund or constituting receipts on the Escrow Securities) in the Escrow Fund at all times as a separate trust account wholly segregated from all other securities, investments or money held by it. All securities and money in the Escrow Fund are hereby irrevocably pledged, subject to the provisions of Section 3 hereof, to secure the payment and redemption of the Refunded Bonds and payment of interest thereon as provided
SC357950 03498-8033Escrow Agreement
herein. On the date of execution and delivery of this Escrow Agreement, the Authority shall cause to be transferred to the Escrow Agent the sum of $ from the proceeds from the sale of the Series 2022 Bond, which the Escrow Agent shall deposit in the Escrow Fund. (b) Investment of Money in the Escrow Fund. The Authority hereby directs the Escrow Agent to purchase the Escrow Securities at a price of $ with amounts in the Escrow Fund and retain the balance of such amounts, $ , in uninvested cash in the Escrow Fund. The Escrow Agent shall not be liable or responsible for any loss resulting from any investment made pursuant to this section and in full compliance with the provisions hereof. (c) Payment from the Escrow Fund. The Authority hereby irrevocably instructs the Escrow Agent, and the Escrow Agent hereby agrees, to use the interest on and principal of all Escrow Securities held in the Escrow Fund, together with any other money, to pay (i) the interest coming due on the Refunded Bonds, and (ii) the redemption price of the Refunded Bonds maturing on or after March 1, 2025, on March 1, 2024, as set forth in Schedule II attached hereto. Following such payment, the Escrow Agent shall transfer any remaining amounts in the Escrow Fund to the Authority.
(d) Deficiencies in the Escrow Fund. If at any time the Escrow Agent shall have actual knowledge that the money in the Escrow Fund, including the anticipated proceeds of the Escrow Securities, will not be sufficient to make the payments required by Section 3 hereof, the Escrow Agent shall notify the Authority in writing as soon as reasonably practicable of such fact, stating the amount of such deficiency and the reason therefor (if known to it), and the Authority shall use its best efforts to obtain and deposit with the Escrow Agent for deposit in the Escrow Fund such additional money as may be required to provide for the making of all such payments, provided that such additional money may be deposited solely from lawfully available funds of the Authority or from a special appropriation made by the Authority for such purpose, which appropriation shall at all times be subject to the sole discretion of the Authority. The Authority shall incur no liability, however, if such additional moneys are unavailable or are not sufficient for such purpose. The Escrow Agent shall in no event or manner be responsible for the failure of the Authority to make any such deposit.
Section 2. Notice of Redemption and Notice of Defeasance. The Authority hereby irrevocably instructs the Trustee, in accordance with the terms and conditions of the Trust Agreement to provide notice of redemption of the Refunded Bonds maturing on or after March 1, 2025, and a notice of defeasance for the Refunded Bonds, such notices to be provided in the time and manner specified in the Trust Agreement and substantially in the forms shown in Exhibit A and Exhibit B.
Section 3. Termination. Upon the completion of the payments required from the Escrow Fund and the transfer of any moneys remaining in the Escrow Fund to the Authority, this Escrow Agreement shall be terminated and of no further force or effect.
Section 4. Compensation and Indemnification of the Escrow Agent. (a) Payment for Services. The Authority shall pay the Escrow Agent an annual fee for its services hereunder and shall reimburse the Escrow Agent for its out-of-pocket expenses (including but not limited to the fees and expenses, if any, of its counsel or accountants) incurred by the Escrow Agent in connection with these services, all as more particularly agreed upon by the Authority and the Escrow
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Agent; provided that these fees and expenses shall in no event be deducted from the Escrow Fund.
Under no circumstances shall the Escrow Agent assert a lien on the Escrow Fund for any of its fees or expenses.
(b) Indemnification. The Authority agrees to indemnify the Escrow Agent, its directors, agents, and its officers or employees for, and hold the Escrow Agent, its directors, agents, and its officers or employees harmless from, liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements of any kind (including, without limitation, reasonable fees and disbursements of counsel or accountants for the Escrow Agent) which may be imposed on, incurred by, or asserted against the Escrow Agent or such other party at any time by reason of its performance of Escrow Agent’s services, in any transaction arising out of the Escrow Agreement or any of the transactions contemplated herein, unless due to the gross negligence or willful misconduct of the Escrow Agent.
(c) Survival of Obligations. The obligations of the Authority hereunder to the Escrow Agent shall survive the termination or discharge of this Escrow Agreement or the resignation or removal of the Escrow Agent.
Section 5. Functions of the Escrow Agent; Immunities.
(a) Application of Escrow Fund. Moneys held by the Escrow Agent hereunder are to be held and applied for the payment of the Refunded Bonds in accordance with the Trust Agreement and this Escrow Agreement.
(b) No Implied Duties. The Escrow Agent undertakes to perform only such duties as are expressly and specifically set forth in the Escrow Agreement and no implied duties or obligations shall be read into the Escrow Agreement against the Escrow Agent. (c) Reliance on Documents. The Escrow Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, and shall be protected and indemnified as stated in the Escrow Agreement, in acting, or refraining from acting, upon any written notice, instruction, request, certificate, document, report or opinion furnished to the Escrow Agent and reasonably believed by the Escrow Agent to have been signed or presented by the proper party, and it need not investigate any fact or matter stated in such notice, instruction, request, certificate, document, report or opinion.
(d) Electronic Communications. The Escrow Agent agrees to accept and act upon instructions or directions pursuant to this Escrow Agreement sent by secure e-mail (for purposes of this Escrow Agreement, an e-mail does not constitute a notice, request or other communication hereunder but rather the portable document format or similar attachment attached to such e-mail will constitute such notice), facsimile transmission or other similar unsecured electronic methods, provided, however, that the Escrow Agent shall have received an incumbency certificate listing persons designated to give such instructions or directions and containing specimen signatures of such designated persons, which such incumbency certificate shall be amended and replaced whenever a person is to be added or deleted from the listing. If the Authority elects to give the Escrow Agent email or facsimile instructions (or instructions by a similar electronic method), the Escrow Agent’s understanding of such instructions shall be deemed controlling. The Escrow Agent shall not be liable for any losses, costs or expenses arising directly or indirectly from the Escrow Agent’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent
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with a subsequent written instruction. The Authority agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Escrow Agent, including without limitation the risk of the Escrow Agent acting on unauthorized instructions, and the risk of interception and misuse by third parties.
(e) Escrow Agent’s Immunities. The Escrow Agent shall not have any liability hereunder except to the extent of its own gross negligence or willful misconduct. In no event shall the Escrow Agent be liable for any special, indirect or consequential damages, even if parties know of the possibility of such damages. The Escrow Agent shall have no duty or responsibility under the Escrow Agreement in the case of any default in the performance of covenants or agreements contained in the Trust Agreement or in the case of the receipt of any written demand with respect to such default. The Escrow Agent is not required to resolve conflicting demands to money or property in its possession under the Escrow Agreement.
(f) Reliance on Advice of Counsel. The Escrow Agent may consult with counsel of its own choice (which may be counsel to the Authority) and the opinion of such counsel shall be full and complete authorization to take or suffer in good faith any action in accordance with such opinion of counsel.
(g) Not Responsible for Authority’s Representations. The Escrow Agent shall not be responsible for any of the recitals or representations contained herein, in the Trust Agreement, or in the Indenture.
(h) Escrow Agent May Own Series 2022 Bond. The Escrow Agent may become the owner of, or acquire any interest in, the Series 2022 Bond with the same rights that it would have if it were not the Escrow Agent, and may engage or be interested in any financial or other transaction with the Authority.
(i) Other Transactions. The Escrow Agent may engage or be interested in any financial or other transaction with the Authority.
(j) Not Responsible for Sufficiency Calculations. The Escrow Agent shall not be liable for the accuracy of the calculations as to the sufficiency of the Escrow Securities and moneys to make the payments of principal of and interest and redemption premium on the Refunded Bonds in accordance with the terms and conditions herein.
(k) Not Responsible for Acts or Omissions of the Authority. The Escrow Agent shall not be liable for any action or omission of the Authority under the Escrow Agreement, the Trust Agreement, the Indenture, or otherwise.
(l) Reliance On Authority Certification. Whenever in the administration of the trust of the Escrow Agreement, the Escrow Agent shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of negligence or willful misconduct on the part of the Escrow Agent, be deemed to be conclusively proved and established by a certificate of the Authority, and such certificate shall, in the absence of gross negligence or willful misconduct on the part of the Escrow Agent, be full warrant to the Escrow Agent for any action taken or suffered by it under the provisions of the Escrow Agreement upon the faith thereof.
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(m) Resignation; Appointment of Successor. The Escrow Agent may at any time resign by giving written notice to the Authority of such resignation, whereupon the Authority shall promptly appoint a successor Escrow Agent by the resignation date. Resignation of the Escrow Agent will be effective sixty (60) days after notice of the resignation is given as stated above or upon appointment of a successor Escrow Agent, whichever first occurs. If the Authority does not appoint a successor Escrow Agent by the resignation effective date, the resigning Escrow Agent may petition any court of competent jurisdiction for the appointment of a successor Escrow Agent (or may deposit with the court the Escrow Securities and money or other property held by it in trust under the Escrow Agreement), which court may thereupon, after such notice, if any, as it may deem proper and prescribe and as may be required by law, appoint a successor Escrow Agent. After receiving a notice of resignation of an Escrow Agent, the Authority may appoint a temporary Escrow Agent to replace the resigning Escrow Agent until the Authority appoints a successor Escrow Agent. Any such temporary Escrow Agent so appointed by the Authority shall immediately and without further act be superseded by the successor Escrow Agent so appointed.
(n) Statements. The Escrow Agent will provide the Authority, within thirty (30) days after the payment of all the Refunded Bonds, with a statement of the Escrow Fund maintained hereunder.
The Escrow Agent shall furnish the Authority periodic cash transaction statements that include detail for all investment transactions effected by the Escrow Agent or brokers selected by the Authority.
Upon the Authority’s election, such statements will be delivered via the Escrow Agent’s online service and upon electing such service, paper statements will be provided only upon request. The Authority waives the right to receive brokerage confirmations of security transactions effected by the Escrow Agent as they occur, to the extent permitted by law. The Authority further understands that trade confirmations for securities transactions effected by the Escrow Agent will be available upon request and at no additional cost and other trade confirmations may be obtained from the applicable broker.
(o) Escrow Agent’s Funds Not at Risk. The liability of the Escrow Agent to make the payments required by this Escrow Agreement shall be limited to the moneys and Escrow Securities in the Escrow Fund. None of the provisions of this Escrow Agreement shall require the Escrow Agent to expend or risk its own funds or otherwise to incur any liability, financial or otherwise, in the performance of any of its duties hereunder.
(p) Use of Agents. The Escrow Agent may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, attorneys, custodians or nominees appointed with due care, and shall not be responsible for any willful misconduct or gross negligence on the part of any agent, attorney, custodian or nominee so appointed. (q) Force Majeure. The Escrow Agent shall not be liable to the parties hereto or deemed in breach or default hereunder if and to the extent its performance hereunder is prevented by reason of force majeure. The term “force majeure” means an occurrence that is beyond the control of the Escrow Agent and could not have been avoided by exercising due care. Force majeure shall include acts of God, terrorism, war, riots, strikes, fire, floods, earthquakes, epidemics or other similar occurrences.
Section 6. Merger or Consolidation of the Escrow Agent. Any company into which the Escrow Agent may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Escrow Agent may sell or transfer all or substantially all of its corporate trust
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business shall be the successor to the Escrow Agent and vested with all of the title to the Escrow Fund and all of the trusts, powers, discretions, immunities, privileges and all other matters as was its predecessor, without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding.
Section 7. Amendment of the Escrow Agreement. The Escrow Agreement may not be revoked or amended by the parties hereto unless (i) there shall first have been filed with the Authority and the Escrow Agent an unqualified opinion of bond counsel that such amendment will not adversely affect the excludability from gross income for federal income tax purposes of interest evidenced by the Refunded Bonds, and unless (ii) such amendment is not materially adverse to the interests of the registered owners of the Refunded Bonds, as evidenced by an opinion of counsel, or the Escrow Agent has received the written consent of the registered owners of all Refunded Bonds then outstanding.
Section 8. Governing Law. The Escrow Agreement shall be construed and governed in accordance with the laws of the State of California.
Section 9. Notices. All notices and communications hereunder shall be in writing and shall be deemed to be duly given if received or sent by first class mail, as follows:
If to the Authority: Woodland Finance Authority
C/O City of Woodland
300 First Street, Woodland, CA 95695,
Attention: Treasurer/Controller
If to the Escrow Agent: U.S. Bank Trust Company, National Association One California Street, Suite 1000
Mail Code – SF-CA-SFCT
San Francisco, CA 94111
Attention: Global Corporate Trust
Section 10. Severability. If any section, paragraph, sentence, clause or provision of the Escrow Agreement shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, sentence, clause or provision shall not affect any of the remaining provisions of the Escrow Agreement.
Section 11. Definitions. Unless the context otherwise requires, capitalized terms used herein shall have the meanings specified in the Trust Agreement.
Section 12. Execution. The Escrow Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all together shall constitute but one and the same agreement.
[Signature page follows]
SC357950 03498-803Signature Page to Escrow Agreement
IN WITNESS WHEREOF, the Authority and the Escrow Agent have caused the Escrow Agreement to be executed each on its behalf.
WOODLAND FINANCE AUTHORITY
By:
Ken Hiatt, Administrator
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Escrow Agent and Trustee
By:
Authorized Signatory
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SCHEDULE I
ESCROW SECURITIES
United States Treasury Certificates of Indebtedness
State and Local Government Series
Principal Amount Interest Rate
First Interest
Payment Date Maturity Date
United States Treasury Note
State and Local Government Series
Principal Amount Interest Rate
First Interest
Payment Date Maturity Date
SCHEDULE II
DEBT SERVICE PAYMENT AND REDEMPTION SCHEDULE
Refunded Bonds
Payment Date
Principal
Redeemed Interest Total
Total
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EXHIBIT A
NOTICE OF DEFEASANCE
WOODLAND FINANCE AUTHORITY
WASTEWATER REVENUE BONDS, REFUNDING SERIES 2014 (JUNIOR LIEN) Maturing March 1, 2025, through March 1, 2035
(Issued March 13, 2014)
Maturity Principal Amount Interest Rate CUSIP*
NOTICE IS HEREBY GIVEN pursuant to the Trust Agreement dated March 1, 2014 (as thereafter amended and supplemented, the “Trust Agreement”), between the Woodland Finance Authority (the “Authority”) and U.S. Bank Trust Company, National Association, as Trustee, which provided for the issuance of the above-captioned bonds (the “Refunded Bonds”):
That the Authority has deposited in escrow with U.S. Bank Trust Company, National Association, as its escrow agent (the “Escrow Agent”), money and United States Treasury Notes and Certificates of Indebtedness, State and Local Government Series, in the necessary amount to pay (i) the interest coming due on the Refunded Bonds, and (ii) the redemption price of the Refunded Bonds maturing on or after March 1, 2025, on March 1, 2024, at a redemption price equal to 100% of the principal amount of the Refunded Bonds, without premium.
All agreements and covenants of the Authority in the Trust Agreement with respect to the Refunded Bonds have ceased, terminated, become void and been discharged and satisfied in accordance with the provisions of the Trust Agreement, except for the obligation to pay interest and on and principal of the Refunded Bonds, but only from moneys on deposit with the Escrow Agent. *The Authority and the Escrow Agent shall not be responsible for the use of the CUSIP number(s) selected, nor is any representation made as to their correctness indicated in this notice or as printed on any Refunded Bond. They are included solely for the convenience of the holders.
DATED: (date of notice generation) U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee
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EXHIBIT B
NOTICE OF REDEMPTION
WOODLAND FINANCE AUTHORITY
WASTEWATER REVENUE BONDS, REFUNDING SERIES 2014 (JUNIOR LIEN) Maturing March 1, 2025, through March 1, 2035
(Issued March 13, 2014)
Maturity Principal Amount Interest Rate CUSIP*
NOTICE IS HEREBY GIVEN pursuant to the Trust Agreement dated March 1, 2014 (as thereafter amended and supplemented, the “Trust Agreement”), between the Woodland Finance Authority (the “Authority”) and U.S. Bank Trust Company, National Association, as Trustee, that provided for the issuance of the above-captioned bonds (the “Refunded Bonds”), that the Refunded Bonds maturing on or after March 1, 2025, will be redeemed on March 1, 2024 (the “Redemption Date”), at a redemption price equal to 100% of the principal amount thereof, without premium (the “Redemption Price”).
Payment of the Redemption Price shall become due and payable on the Redemption Date, together with interest thereon accrued to the Redemption Date, upon presentation and surrender of such Refunded Bonds to the Corporation Trust Office(s) listed below:
U.S. Bank Trust Company, National Association
Global Corporate Trust
111 Fillmore Ave E
St. Paul, MN 55107
Interest on such Refunded Bonds shall cease to accrue on and after the Redemption Date.
IMPORTANT NOTICE
Under the provisions of the Jobs and Growth Tax Relief Reconciliation Act of 2003, 28% will be withheld if tax identification number is not properly certified.
DATED: (date of notice generation) U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee
PLACEMENT AGENT AGREEMENT
MUNICIPAL ISSUERS
May 3, 2022
City of Woodland, California
Kimberly McKinney
Via email
Re: Placement Agent Agreement
Wastewater Revenue Refunding Bonds
Dear Ms. McKinney:
This letter confirms the agreement (the “Agreement”) between Hilltop Securities Inc. (“HilltopSecurities” or “we” or “us”) and City of Woodland (the “Issuer” or “you”). You desire to engage HilltopSecurities as a placement agent in connection with the placement of your Wastewater Revenue Refunding Bonds (the “Securities”). Pursuant to MSRB Rule 15c2-12(d), the Securities will be issued in authorized denominations of $100,000 or more with, as currently contemplated, gross proceeds of approximately $23,300,000 for the purpose of refunding the City’s 2014 Bonds pursuant to Resolution No authorizing document to be adopted on May , 2022 (the “Resolution”). As a placement agent, HilltopSecurities will have duties, roles and responsibilities that are different from those of a municipal advisor. You are directed to consider the MSRB Rule G-17 disclosures relevant to placement agent activity.
Engagement. The Issuer engages HilltopSecurities to act as its exclusive representative to assist you on a best efforts basis in placing the Securities (the “Transaction”). You acknowledge and agree that our engagement hereunder is not an agreement by HilltopSecurities or any of its affiliates to underwrite, place or purchase the Securities or otherwise provide any financing to you. We accept this engagement upon the terms and conditions set forth in this Agreement. Sale and delivery of the Securities by the Issuer and purchase by the purchasers will occur on the day of closing (“Closing Date”).
Fees. For our services, you agree to pay us $42,500 payable by wire transfer of immediately available funds on the Closing Date. For avoidance of doubt, the Placement Agent Fee shall be contingent upon the closing of the Transaction.
Disclosure and Due Diligence. The Issuer will prepare and provide to the Placement Agent the following:
A term sheet and/or other documents including financials, budgets, estimated debt service requirements and coverage, historical tax collections by relevant classification, litigation and regulatory materials, material contracts, Issuer demographic information, underlying credit ratings and other information deemed material to investors, (the “Information Package”). The draft Resolution and other legal documents to be used in connection with the Transaction (together with all supplements, modifications, and additions thereto prior to the Closing Date, which together with the Information Package are referred to as the “Placement Materials”). The Issuer will make available to the Purchaser and the Placement Agent such documents and other information which the Purchaser or the Placement Agent reasonably deem appropriate, will provide access to its officers, directors, employees, accountants, counsel and other representatives, and will
provide the Purchaser and the Placement Agent the opportunity to ask questions and receive answers from knowledgeable individuals.
The Issuer will cause its counsel to allow the Placement Agent to rely on any opinion provided to the Issuer, and will allow the Placement Agent to rely on any representations made to the Purchaser by the Issuer.
Representations, Warranties and Agreements of the Issuer. You represent and warrant to, and agree with us, that:
The Issuer is duly organized and validly existing under the laws of the State of California (the “State”) with the power to adopt the Resolution, perform the agreements on its part contained therein and in the agreements approved thereby and cause the issuance of the Securities. The Issuer: (i) has duly authorized and approved the execution and delivery of this Agreement; (ii) will adopt and on the Closing Date will have duly adopted the Resolution; (iii) will duly authorize and approve the Placement Materials and the use and distribution of the Placement Materials to prospective Purchasers; and (iv) will duly authorize and approve the execution and delivery of all financing or operative documents, including the Securities, to which the Issuer is a party relating to the issuance and security for the Securities, as such documents are amended and supplemented to the Closing Date, including but not limited to any trust indenture, loan agreement, or security instrument (the “Financing Documents”), and the performance of its obligations and the consummation by it of all other transactions contemplated thereby. On the Closing Date, the Financing Documents will have been duly authorized, executed, and delivered by the Issuer, and, assuming due authorization, execution and delivery by the other parties thereto, as applicable, constitute legal, valid and binding agreements of the Issuer enforceable in accordance with their respective terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other laws affecting the enforcement of creditors’ rights generally and by the application of equitable principles if sought and by the limitations on legal remedies imposed on actions against the Issuer in the State of California.
The Issuer is not, and on the Closing Date will not be, in breach of or default under any applicable law or administrative regulation of the State or any department, division, agency or instrumentality thereof, or of the United States, or any applicable judgment or decree or any loan agreement, note, Resolution, certificate, agreement or other instrument to which the Issuer is a party or is otherwise subject, which breach or default would materially and adversely affect the Issuer or its ability to perform its duties and obligations under the Financing Documents, and the execution and delivery of the Financing Documents, the adoption of the Resolution and the issuance of the Securities and compliance with the provisions of each will not conflict with or constitute a breach of or default under any applicable law or administrative regulation of the State or under any certificate, agreement or other instrument to which the Issuer is a party or is otherwise subject, which breach or default would materially and adversely affect the Issuer or its ability to perform its duties under the Financing Documents and the Securities.
No action, suit, proceeding or investigation at law or in equity before or by any court, governmental agency, public board or body is, and on the Closing Date will not be, pending or, to the knowledge of the Issuer, threatened: (i) in any way affecting the existence of the Issuer or the titles of the members of the authorizing body of the Issuer to their respective offices, (ii) seeking to prohibit, restrain or enjoin the issuance, sale or delivery of the Securities or the collection or payment by the
Issuer of any amounts pledged or to be pledged as security to pay the principal of and interest on Securities, (iii) in any way contesting or affecting the validity or enforceability of, or the power or authority of the Issuer to issue, adopt or to enter into (as applicable), the Securities, the Resolution or the Financing Documents, (iv) contesting in any way the completeness, truth, or accuracy of the Placement Materials, (v) except as disclosed in the Placement Materials, wherein an unfavorable decision, ruling or finding would materially adversely affect the financial position or condition of the Issuer or would result in any material adverse change in the ability of the Issuer to pledge or apply the security or source of payment of, or to pay debt service on the Securities, or (vi) contesting the status of the interest on the Securities as excludable from gross income for federal income tax purposes or as exempt from any applicable state tax.
Regarding information provided by the Issuer to the Purchaser and the Placement Agent, (i) the Issuer represents and warrants that all information made available to the Purchaser and the Placement Agent by the Issuer or contained in the Information Package, when provided will at all times thereafter during the period of the engagement of the Placement Agent hereunder, be true and accurate in all material respects and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in light of the circumstances under which such statements are made.
Documents to be Delivered at Closing. On the Closing Date, the Issuer will deliver or cause to be delivered to the Placement Agent:
The Opinion of Bond Counsel to the Issuer, dated the Closing Date relating to the validity of the Securities, and if the Securities are tax-exempt, the tax-exempt status of the Securities, together with a reliance letter from such counsel, dated the Closing Date and addressed to Hilltop Securities Inc.
An Purchaser Letter, in the form attached to this Agreement as Appendix A, executed by each Purchaser and addressed to the Issuer and the Placement Agent; and A certificate of the Issuer, dated the Closing Date, in the form attached to this Agreement as Appendix B.
Such additional legal opinions, certificates, proceedings, instruments and other documents as the Placement Agent or its counsel, if any, and Bond Counsel may reasonably request to evidence compliance by the Issuer with legal requirements, the truth and accuracy, as of the Closing Date, of the representations of the Issuer, and the due performance or satisfaction by the Issuer at or prior to such time of all agreements then to be performed and all conditions then to be satisfied by the Issuer.
Regulatory Disclosures. You acknowledge that you have retained us solely to provide the services to you as set forth in this agreement. As placement agent, HilltopSecurities may provide advice concerning the structure, timing, terms, and other similar matters concerning the Transaction. You acknowledge and agree that: (i) the primary role of HilltopSecurities as a placement agent, is to place securities to investors in an arms-length commercial transaction and that HilltopSecurities has financial and other interests that differ from your interests; (ii) HilltopSecurities is not acting as a municipal advisor, financial advisor or fiduciary to you or any other person or entity and has not assumed any advisory or fiduciary responsibility to you with respect to the transaction contemplated herein and the discussions, undertakings and proceedings leading thereto (irrespective of whether HilltopSecurities has provided other services or is currently providing other services to you on other matters); (iii) the only obligations HilltopSecurities has to you with respect to the transaction contemplated hereby expressly are set forth in this agreement; and (iv) you have