HomeMy WebLinkAbout08- Development Department DEVELOPMENT DEPARTMENT OF THE
CITY OF SAN BERNARDINO
REQUEST FOR COMMISSION/COUNCIL ACTION
From: KENNETH J. HENDERSON Subject: WELLS FARGO LINE OF
Executive Director CREDIT EXTENSION
Date: February 10, 1994
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Synopsis of Previous Commission/Council/Committee Action(s):
On July 2, 1990, the Community Development Commission authorized the
execution of a Letter of Acceptance for a Line of Credit with Wells
Fargo.
On October 1, 1990, the Community Development Commission authorized the
negotiation of an agreement with Wells Fargo Bank for investment
services.
On December 10, 1990, the Community Development Commission authorized
lines of credit with Wells Fargo Bank.
(Synopsis Continued to Next Page. . .)
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Recommended Motion:
(Community Development Commission)
MOTION: That the Community Development Commission authorize a one year
extension of certain Lines of Credit with Wells Fargo Bank and
authorize the execution of said documents.
I
Administrator KENNET J. HEqDERSON, Executive Director
Development D partment
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Contact Person: Ken Henderson/Barbara Lindseth Phone: 5065; 5081
Project Area: All Ward(s) : 1 through 7
Supporting Data Attached: Staff Report
FUNDING REQUIREMENTS: Amount: N/A Source: N/A
Budget Authority: N/A
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Commission/Council Notes:
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KJH:BJL:1679A COMMISSION MEETING
Meeting Date: 2/2111994
Agenda Item Number:
DEVELOPMENT DEPARTMENT
REQUEST FOR COMMISSION/COUNCIL ACTION
Wells Fargo Line of Credit Extension
Page —2—
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Synopsis of Previous Commission/Council/Committee Action(s) Continued
On April 17, 1991, the Community Development Commission authorized the
Executive Director to make certain financial guarantees with regard to the
West Side Plaza Project.
On June 3, 1991, the Community Development Commission authorized the
amendment of certain lines of credit with Wells Fargo Bank and the
execution of certain documents in connection therewith.
On February 17, 1992, the Community Development Commission approved a one
year extension of the Lines of Credit with Wells Fargo Bank.
On March 11, 1993, the Redevelopment Committee recommended to the
Community Development Commission approval of this item.
On March 22, 1993, the Community Development Commission approved a one
year extension of the Lines of Credit with Wells Fargo Bank.
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KJH:BJL:1679A COMMISSION MEETING
Meeting Date: 2/21/1994
Agenda Item Number:
DEVELOPMENT DEPARTMENT
STAFF REPORT
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Wells Fargo Line of Credit Amendment
In 1990, the firm of Wood-Husing and Associates was directed to assist
the Department with the maximization of yields the Department could
earn on its investment portfolio by undertaking a review of the cost,
risk and rate of return from alternate investment strategies available,
consistent with the Department's existing investment policies. The
firm was also directed to maximize the leverage which that portfolio
gives the Department in obtaining loanable funds from the banking
community by assisting in negotiating with Wells Fargo Bank a maximum
line of credit for use on redevelopment projects.
As approved on July 2, 1990 by the Commission, and as amended on June
3, 1991, the Line of Credit was designed to extend credit to the
Department in the aggregate principal amount of $10,000,000. This is a
secured line of credit payable at prime rate minus .50% to be repaid at
the Department's terms, with a current maturity date of March 1, 1994,
and with collateral of secured interest in cash or cash equivalents of
not less than the line commitment. There are no commitment or loan
fees.
As collateral, $10,000,000 was approved by the Commission to be
invested through Wells Fargo Bank Investment Services. These funds are
tax increment funds, not bond proceeds, and the funds are invested in
accordance with the Department's Investment Policy. Investment of
these funds with Wells Fargo meets the requirement that the Department
secures any remaining draws on the $10,000,000, and any outstanding
draws on the line of credit.
In addition, the Commission adopted benefit resolutions (5266 and 5292)
authorizing the deposit of funds from the Southeast Industrial Park
project area to be invested with Wells Fargo as collateral for the
lines of credit issued to the Northwest and South Valle project area.
Said benefit resolutions are still in effect; however, the Lines of
Credit will expire on March 1, 1994.
It is proposed to extend the maturity date of the line of credit for
one year, until March 1, 1995, with the same terms and conditions and
stated above.
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KJH:BJL:1679A COMMISSION MEETING
Meeting Date: 2/21/1994
Agenda Item Number: [�'
DEVELOPMENT DEPARTMENT e-TAFF REPORT
Line of Credit With We ; Fargo Bank
February 10, 1994
Page Number —2—
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Staff recommends extension of the Line of Credit for one year, until
March 1, 1995, because the Line is critical to the West Side Plaza
project, the HAB Development, and the Portugal and Neal Development.
Staff recommends adoption of the form motion.
Ix in
KENNE J. HEkDERSON, Executive Director
Development epartment
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KJH:BJL:1679A COMMISSION MEETING
Meeting Date: 2/21/1994
Agenda Item Number: