AgdaPkt 2012-01-09 - Laserfiche WebLink

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8.A. - Page 1 RE PO RT To the Honorable Mayor and City Council From the City Manager January 9, 2012 SUBJECT Sale of bonds pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the Act), to refund the outstanding City of Redwood City Community Facilities District No. 2000-1 (Pacific Shores Project) Special Tax Bonds, Series 2000A (the "2000 Bonds") RECOMMENDATION Approve by resolution, authorization for the issuance and sale of Special Tax Refunding Bonds for and on behalf of the City of Redwood City Community Facilities District No. 2000-1 (Pacific Shores Project) and approval of all documents and agreements, including the Preliminary Official Statement, necessary to issue such bonds. BACKGROUND The Pacific Shores Project consists of approximately 1.6 million square feet of commercial office space in 10 buildings located on a 106 acre site at the end of Seaport Boulevard. The Bonds were issued in March 2000 in the amount of $21 million to finance public infrastructure improvements required by the City as a condition to construction of the project. Presently about $8.6 million of these bonds remains outstanding. According to the original debt service payment schedule, the bonds will be paid off in September 2017. The project is currently approximately 80% owned by a real estate partnership controlled by Starwood Capital Group and 20% by a partnership controlled by Shorenstein Properties LLC (the "Owners"). The Owners requested that the City undertake a refunding of the 2000 Bonds to reduce debt service and realize special tax savings that would be passed on to tenants. The debt service on the 2000 Bonds is the sole responsibility of the property owners. The 2000 Bonds are secured by a lien on the real property within the CFD while the principal and interest payments are paid through a special tax levied on the properties within the CFD. The City's only obligation in the event that one of the property owners defaults on the payment of their special tax is to advance funds from the debt service reserve fund and, if necessary, to initiate foreclosure proceedings. No City funds are pledged to repay the debt service on these bonds. The annual debt service currently averages about $2 million and is allocated to the Owners based on their amount of improved property within the CFD.