AgdaPkt 2019-05-20 Joint SA PFA - Laserfiche WebLink

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8.A. - Page 49 of 73 (Continued from previous page) Attachment D (4) Includes sanitary sewer maintenance, storm water collection and disposal, revenue and administrative support services, right-of-way rental and SVCW wastewater treatment operations. For 2018-19, all expenses other than SVCW wastewater treatment operations represent 2018- 19 budgeted amounts, with subsequent years assuming annual increases of 4%. SVCW operating expenses assume 4% annual increases for personnel (including benefits) and utilities and 3% annual increases for administrative expenses, equipment and supplies, and professional services. 0) Represents Redwood City's SBSA Bond Payments due under the Redwood City Financing Agreement with respect to the Authority's outstanding Panty Debt, which are senior to the pledge of and lien upon the Net Revenues for the payment of Subordinate Debt (including the Series 2019 Notes) under the Redwood City Financing Agreement. Amounts shown are gross of any reserve and interest credits that may be received by Redwood City. 0) Represents gross SBSA Bond Payments with respect to the SVCW 2009 Bonds, excluding Redwood City's proportionate share of any Refundable Credits that may be received as a result of receipt by the Authority of cash subsidy payments from the United States Treasury. 0 Assuming a four-year deferment on the WIFIA Loan after substantial completion of the project, payment obligations of the City under the WIFIA Loan is not expected to begin until Fiscal Year 2027-28. ce) Represents Net Revenues divided by Total Parity Debt. 0) Represents Redwood City's share of other SVCW obligations which are junior and subordinate to the pledge of and lien upon the Net Revenues for the payment of SVCW Bond Payments on the Parity Debt and payments of principal of and interest on any Subordinate Debt. Future SRF Loan debt service assumes that SVCW enters into an $140.8 million match funding loan with the California State Water Resources Control Board. cl°) Represents Redwood City's payment obligations on the Subordinate Debt outstanding under the Redwood City Financing Agreement, which are junior to the pledge of and lien upon the Net Revenues for the payment of Parity Debt under the Redwood City Financing Agreement. 00 Preliminary, subject to change. Debt service is shown net of capitalized interest through Fiscal Year 2023-24. The principal of and interest on the Series 2019 Notes are expected to be paid with proceeds of the WIFIA Loan. SVCW SRF reserve contributions are based on SVCW projections shown in Table A8 herein and are based on the assumption that each of the SVCW member agencies make annual contributions toward their respective share of the reserve requirement for SVCW's SRF loans. Actual SRF reserve requirements are required to be met approximately 90 days prior to the project completion date for SRF loan. (13) Any excess Capital & Other Non -Operating expenses are paid out of the City's Sewer Utility Fund Reserve. Source: City of Redwood City. Absence of Litigation The City is not aware of any action, suit, or proceeding known to be pending or threatened, that would affect the execution of the City's Financing Agreement with the Authority, or materially adversely impact the finances of the City's wastewater system. Financial Statements The City's audited financial statements for the fiscal year ending June 30, 2018 are attached hereto as Exhibit I. The City's financial statements were audited by Badawi & Associates, Certified Public Accountants, independent auditors (the "Auditor"). The Auditor's letter concludes that the City's financial statements present fairly, in all material respects, the respective financial position of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2018, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. The Auditor has not been asked to consent to the inclusion of the City's audited financial statements in this Official Statement and no procedures were performed, and the Auditor has not reviewed this Official Statement. Constitutional Limitations on Appropriations and Charges Articles X1IIA, X11113, X111C and X111D of the California State Constitution were adopted as a measure that qualified for the ballot pursuant to California's initiative process. From time to time other initiatives could be proposed and adopted affecting the ability of the City to increase revenues sufficient to make payments to the Authority under the Joint Powers Agreement or the Redwood City Financing Agreement. A-21 563