AgdaPkt 2020-11-23 Joint SA PFA - Laserfiche WebLink

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8.A. - Page 50 of 51 Participating Member is obligated to levy or pledge any form of taxation or for which the Participating Member has levied or pledged any form of taxation. Each of the Participating Members has covenanted to establish rates and charges for its wastewater system to yield Gross Revenues sufficient to make the SBSA Bond Payments and Authority Bond Payments. The obligation of each Participating Member to pay SBSA Bond Payments or Authority Bond Payments does not constitute a debt of that Participating Member or the State or any of its political subdivisions, and does not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction. The Net Revenues from one Participating Member's wastewater system are pledged solely to that Participating Member's obligations under the Financing Agreement to which it is a party. No Participating Member has any liability or responsibility for the SBSA Bond Payment or Authority Bond Payment of another Participating Member. If the Gross Revenues generated by a Participating Member were insufficient to pay that Participating Member's Operation and Maintenance Costs and SBSA Bond Payments and Authority Bond Payments under the respective Financing Agreements, there would likely not be Net Revenues available to pay SBSA Bond Payments or Authority Bond Payments. See the caption "SECURITY FOR THE 2020 BONDS—Financing Agreements" herein and Appendix E—"FINANCING AGREEMENTS" attached hereto. Change in Law In addition to the other limitations described herein, the California electorate or Legislature could adopt a constitutional amendment, legislation, or an initiative with the effect of reducing revenues payable to or collected by the Participating Members. Additionally, changes in State or federal regulations could result in a reduction in revenues payable to or collected by the Participating Members. There is no assurance that the California electorate or Legislature will not at some future time approve additional limitations that could have the effect of reducing the Net Revenues of a Participating Member and adversely affecting the security of the 2020 Bonds. Collection of Property Taxes Sewer service charges from San Carlos and West Bay are billed on San Mateo County's property tax bills. San Mateo County is on the Teeter Plan, under which the County pays each agency for the full amount of sewer service charges assessed on the County's tax rolls. The County has the option to discontinue an agency's participation in the Teeter Plan, and there is no assurance that the County or San Carlos and West Bay will continue to participate in the Teeter Plan. Currently, Redwood City is considering participating in the Teeter Plan. Failure of San Carlos or West Bay to properly levy or collect service charges or fees in connection with its wastewater systems, or the discontinuance of San Mateo County's or a Participating Member's participation in the Teeter Plan, could result in a delay or decrease in the collection of Net Revenues by San Carlos and West Bay and the failure of San Carlos and West Bay to generate Net Revenues in an amount sufficient to pay SBSA Bond Payments or Authority Bond Payments. Cybersecurity The Participating Members, like many other public and private entities, rely on large and complex technology environments to conduct their operations. As recipients and providers of ATTY/AGR/2020.264/PRELI M I NARY OFFICIAL STATEMENT— WASTEWATER REV: 11-18-2020 EI Page 28 of 29 716