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COUNCIL ACTION CORRESPONDENCE
To Roger Hardgrave, Director Subject Assessment District 983,
Public Works/Engineer Central City South
Date December 23, 1987
Meeting Date Agenda Item No.
December 21 , 1987 21
Action
The Director of Public Works/City Engineer was directed to develop a request
for proposals regarding financial services for Assessment District 983,
in the CIS-itral City South area and report back on January 19, 1988.
The proposed Resolution approving certain proposals and agreements (Bond Counsel
and Investment Banker) was continued to January 19, 1988.
SC:re
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cc: City Administrator
SHAUNA CLARK
City Clerk
1 RESOLUTION NO .
2 RESOLUTION OF THE CITY OF SAN BERNARDINO APPROVING
CERTAIN PROPOSALS AND AGREEMENTS ( BOND COUNSEL AND INVESTMEi1T
3 BANKER)
4 WHEREAS, the City of San Bernardino ( hereinafter called
5 "City" ) , has been requested to commence study of the
6 feasibility of issuing bonds pursuant to the Improvement Bond
7 Act of 1915 for the construction of all offsite improvements in
8 the Central City South Area (Assessment District No. 983) ; and
9 WHEREAS, BROWN & DIVEN, ("Bond Counsel "), has submitted
10 a proposal to serve as Bond Counsel to the City in connection
11 with the proceedings under the Municipal Improvement Act of
12 1913 and issuance of said 1915 Act Bonds ; and
13 WHEREAS, it is desirable for Bond Counsel and the City
14 to enter into an agreement whereby the respective rights ,
15 obligations and duties of Bond Counsel and the City may be set
16 forth with respect thereto ; and
17 WHEREAS , MILLER & SCHROEDER FINANCIAL , INC. the
18 " Investment Banker" ) , has submitted a proposal to act as an
19 Investment Banker and assist the City and the City Staff in
20 determining the financial feasibility of issuing bonds of the
21 City and to select appropriate methods of financing Assessment
22 District No. 983; and
23 WHEREAS, it is desirable for the Investment Banker and
24 the City to enter into an agreement whereby the respective
25 rights, obligations and duties of the Investment Banker and the
28 City may be set forth with respect thereto.
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10-20-87
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1 NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
2 COUNCIL OF THE CITY OF SAN BERNARDINO THAT:
3 SECTION 1. The City hereby approves the agreements as
4 attached hereto as Exhibits "A" and "B" of the Bond Counsel and
5 Investment Banker , respectively, and incorporated herein by
6 reference and made a part hereof as though fully set forth at
7 length herein .
8 SECTION 2 . That the Mayor of the City of San
9 Bernardino is hereby authorized and directed to execute on
10 behalf of said City said agreements with the Bond Counsel and
11 Investment Banker.
12 SECTION 3. The source of payment with respect to said
13 agreements as herein approved and the financial obligations of
14 the City relative thereto shall be solely from the sale of the
15 tax-exempt bonds or other obligations of the City as provided
16 in said agreements and not from any other funds or moneys of
17 the City.
18 SECTION 4. This Resolution shall take effect upon
19 adoption.
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28 0-20-87 2
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1 I HEREBY CERTIFY that the foregoing resolution was duly
2 adopted by the Mayor and Common Council of the City of San
3 Bernardino at a meeting thereof, held
4 on the day of 1987, by the
5 following vote , to wit:
6
7 AYES : CounciiMembers
8
9 NAYS :
10 ABSENT:
11
12
13
City Clerk
14
15
16 The foregoing resolution is hereby approved this
17 day of 1987 .
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21 Mayor of the My of an BernarFino
22
23 Approved as to form
and legal content:
24 (`
25
26 i y Attorney
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0-20-87 3
SPECIAL COUNSEL AGREEMENT
THIS AGREEMENT is made and entered into this day of
, 1987 by and between the CITY OF SAN BERNARDINO,
CALIFORNIA, a public corporation (hereinafter referred to as "City") ,
and BROWN & DIVEN, (hereinafter referred to as "Counsel") .
NOW, THEREFORE, IT IS HEREBY AGREED by and between the parties here-
to as follows:
SECTION 1. This Agreement shall be for a term of two (2) years from
the date hereof.
SECTION 2. That Counsel shall perform legal services in connection
with the proposed assessment proceedings and bond
issuance in the matter of a proposed special assessment
district known and designated as CENTRAL CITY SOUTH
ASSESSMENT DISTRICT (MILL AND "G" STREET) (hereinafter
referred to as the "Assessment District" ) under pro-
ceedings conducted pursuant to the provisions of the
"Municipal Improvement Act of 1913" , being Division 12
of the Streets and Highways Code of the State of
California.
Said Services shall include:
A. Review of the dedication and acquisition of the
streets and easements and other property in which
work is proposed to be performed;
B. Examination of the plans and specifications for the
proposed work, the boundary map and assessment dia-
gram of the Assessment District, the assessment roll
and bonds, and the giving of instructions and advice
in connection with the foregoing;
C. Recommendations as to procedure, schedules and
actions that should be conducted and taken;
D. Preparation of all resolutions, notices, contracts,
bond forms, and other papers and documents required
in the proceedings;
E. Examination of the proceedings, step by step, as taken;
F . Appear at all hearings under the proceedings , and
attend any meeting where attendance is requested;
G. Make recommendations as to sale of bonds, if desired;
H. Perform legal services, if required, pursuant to the
provisions of the "Special Assessment Investigation,
Limitation and Majority Protest Act of 1931" , being
Division 4 of the Streets and Highways Code of the
State of California;
Exhibit "A"
I. Issuance of an approving legal opinion attesting
to the validity of the proceedings and the issuance
of the bonds.
Such legal services shall not include any services in
connection with the acquisition, by easement or condemna-
tion, of any easements or other interest in real property
necessary for the proposed improvements. These services
can be provided by Counsel, by separate agreement, if de-
sired.
SECTION 3 . That the City shall perform as follows:
A. Furnish to Counsel such maps , records, title searches,
and other documents and proceedings, or certified
copies thereof, as are available and may be reason-
ably required by Counsel in the performance of the
services hereunder;
B. Pay to Counsel a fee computed on the confirmed assess-
ment as follows:
ONE PERCENT (1%) on the first $1,500, 000;
ONE-HALF PERCENT (1/20) from $1,500, 001 to $7, 500, 000;
ONE-QUARTER PERCENT (1/4%) from $7, 500, 001 to
$15,000, 000;
ONE-EIGHTH PERCENT (1/8%) on the balance thereof.
C. Payment of the above-referenced fee shall be as
follows:
All due and payable upon receipt of money from the
sale and delivery of bonds to the successful under-
writer.
SECTION 4 . Counsel hereby states that it does not represent clients
with adverse interests as it relates to the issuance and
sale of the bonds for financing this Assessment District.
SECTION 5 . That this Agreement may be terminated by either party
hereto by mailing ten (10) days ' prior written notice
thereof to the other party involved by certified mail to
the following address:
CITY OF SAN BERNARDINO BROWN & DIVEN
300 North "0" Street P.O. Box 8025, Fairbanks Ranch Plaza
San Bernardino, California Rancho Santa Fe, California
92418 92067
Exhibit "A"
SECTION 6 . This Agreement may not be amended except upon the ex-
press written agreement of the parties hereto.
SECTION 7. This Agreement and any documents or instruments
attached hereto or referred to herein integrate
all terms and conditions mentioned herein or incidental
hereto, and supercede all negotiations and prior writing
in respect to the subject matter hereof. In the event
of conflict between the terms, conditions or provisions
of this agreement, and any such document or instrument,
the terms and conditions of this agreement shall prevail .
IN WITNESS WHEREOF, the parties hereto have caused this agreement
to be executed on the day and year first hereinabove written.
"CITY"
CITY OF SAN BERNARDINO
MAYOR
CITY OF SAN BERNARDINO
STATE OF CALIFORNIA
ATTEST:
CITY CLERK
CITY OF SAN BERNARDINO
STATE OF CALIFORNIA
"COUNSEL"
BROWN & D
APPROVED AS TO FORM
and legal content :
By:
n F. CXSNZIgi ROWN
t Attorney
Exhibit "A"
AGREEMENT FOR INVESTMENT BANKING SERVICES
THIS AGREEMENT, made this day of 1987, by and
between the City of San Bernardino, California (hereinafter called
the "City") , party of the first part, and MILLER & SCHROEDER
FINANCIAL, INC. , 505 Lomas Santa Fe Drive, Solana Beach, California
(hereinafter called the "investment Banker") , party of the second
part:
WITNESSETH:
WHEREAS, the City proposes to initiate proceedings for Assess-
ment District No. 983 (Central City South) (the "Project") ; and
WHEREAS, the City requires assistance in the development of a
sound, equitable and practical financing plan to implement the Pro-
ject by taking into consideration sources of capital funds and cash
flow requirements, annual costs, the allocation of those costs,
statutory requirements and restrictions, and alternate methods, if
applicable; and
WHEREAS, the City requires the services of a municipal invest-
ment banker experienced in financial consulting for and underwriting
the obligations of cities to assist in such financial planning and
to purchase the City ' s obligations at negotiated sale, and to co-
ordinate the sale and distribution of the City' s obligations; and
WHEREAS, the City has determined that the Investment Banker
is qualified by training and experience to perform said services;
Exhibit "B"
NOW, THEREFORE, it is mutually agreed as follows, to wit:
The City hereby employs the Investment Banker and the Invest-
ment Banker hereby accepts such employment to perform the services,
upon the terms, subject to the conditions, and in consideration of
payments as hereinafter set forth:
Services to be Performed by the Investment Banker:
The Investment Banker shall perform in a diligent manner the
following services:
1. Assemble, review and analyze available financial and economic
data and information which may have a general bearing on a program
for financing the Project.
2 . Based on the foregoing analysis, prepare a general review
and description of the Project and outline the possible methods of
financing such Project, the advantages and disadvantages of each
method as applied to a given Project, the general legal and practical
requirements or restrictions applicable to each method and their
attendant costs.
3. Assist Bond Counsel with the preparation of necessary
resolutions and other legal documents and make recommendations as to
the exact terms and conditions under which bonds are to be issued
and sold, including timing and method of sale , final amortization
or repayment schedules, call and redemption features, provisions
governing the issuance of additional bonds, covenants and other
provisions in order to secure the best possible rating on the bonds.
4. Prepare the text and other material for an Official State-
ment or bond prospectus describing the improvements, the bonds,
their security, and economic and financial information on the City.
Exhibit "B"
5 . If it is appropriate or desirable for any other
public entity or agency thereof to participate in
accomplishing the financing for the Project, the Investment
Banker, in order to achieve maximum coordination of the
proposed financing, shall, upon receipt of the approval of such
other public entity or agency, also serve as the investment
banker for such public entity or agency under the terms and
conditions hereof .
6. The Investment Banker shall be available at
reasonable times by telephone or at the offices of the City to
discuss on a continuing basis the results of studies and
analysis and generate such additional information as described
or requested and consult with the City as to the financial
aspects of any specific project then being considered.
7. Sale of Bonds; Compensation
Unless the private sale of the City ' s obligations is
prohibited by law, the City and Investment Banker shall enter
into a bond purchase agreement for the sale of the City' s
obligations to the Investment Banker bearing interest at rates
and at such discount as may be mutually agreeable to the City
and the Investment Banker. The purchase of such obligations
shall be subject to the standard and customary conditions of
obligations of a similar nature including an unqualified legal
opinion of counsel with respect to the validity and tax-
exempt status of such obligations. City has entered into a
contract with the law firm of Brown & Diven as bond counsel for
the project. That firm is hereby accepted as "counsel" for
Exhibit "B"
purpose of this provision for so long as the Agreement between
City and Brown & Diven shall remain in effect.
It is understood that the Investment Banker ' s
compensation may be greater that the discount to the extent
that market conditions allow the obligations to be resold at
the price in excess of their par value. The reasonable
expectation of such premium, if any, shall be taken into
account in determining the interest rate or rates and discount
on the obligations. Investment Banker hereby specifically
agrees to use its best good faith efforts in establishing the
interest rate or rates and discount on the obligations .
8 . In accordance with the terms and conditions of the
Bond Purchase Contract, the Investment Banker shall, from the
bond discount, bear all sales, management, underwriting and
out-of-pocket costs and expenses, including, without
limitation, travel, telephone, telegraph, stenographic work and
the like, incurred by the Investment Banker in performing the
Investment Banker ' s duties and obligations, unless the City
specifically agrees in writing to the payment of such costs.
The Investment Banker is not responsible for and shall not be
held liable for any other expense or expenditure in connection
with the financing program.
9 . The term of this Agreement shall be two (2) years
from the date hereof, but may be cancelled without cause by
either party by giving the other party thirty (30) days written
notice of such cancellation. Said notice to be sent certified
mail to the following address:
CITY OF SAN BERNARDINO MILLER & SCHROEDER
300 North "D" Street 505 Lomas Santa Fe Drive
San Bernardino, CA 92418 Solana Beach, CA
VIM IWO
Ar
10. This Agreement shall not be amended except upon the express
written Agreement of the parties hereto to such amendment.
11. This Agreement and any documents or instruments attached
hereto or referred to herein integrate or terms and conditions
mentioned herein or incidental hereto, and supercede all negotia-
tions and prior writing in respect to the subject matter hereof.
In the event of conflict between the terms, conditions or pro-
visions of this Agreement, and any such document or instrument,
the terms and conditions of this Agreement shall prevail.
IN WITNESS WHEREOF, said City, party of the first part, has
caused these presents to be properly executed, and said Investment
Banker, party of the second part, has caused these presents to be
executed by one of its officers, as of the date hereinabove set
forth.
ATTEST: THE CITY OF SAN BERNARDINO
By
Secretary
MILLER & OEDER FINANC
r
Approved as to form
and legal content :
y Attorney
Exhibit "B"
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