Item 40 - Refinancing City’s Pension Obligations with California Public Employees Retirement System

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1 4826-7904-2280v7/200434-0005 $513,000,000* CITY OF SANTA ANA 2021 TAXABLE PENSION OBLIGATION BONDS, SERIES A INTRODUCTION This Introduction contains only a brief summary of certain of the terms of the Bonds being offered and a brief description of the Official Statement. All statements contained in this Introduction are qualified in their entirety by reference to the entire Official Statement. References to, and summaries of, provisions of the Constitution and laws of the State of California (the “State”) and any documents referred to herein do not purport to be complete, and such references are qualified in their entirety by the complete documents. This Official Statement speaks only as of its date, and the information contained herein is subject to change. General This Official Statement provides certain information concerning the issuance, sale and delivery of the City of Santa Ana 2021 Taxable Pension Obligation Bonds, Series A (the “Bonds”), in the aggregate principal amount of $513,000,000*. The Bonds are being issued pursuant to the Trust Agreement, dated as of September 1, 2021 (the “Trust Agreement”), by and between the City of Santa Ana (the “City”) and U.S. Bank National Association, Los Angeles, California, as trustee (the “Trustee”). For definitions of certain words and terms which are used herein but not otherwise defined, see Appendix C. The Bonds are being issued: (i) to pay all or a portion of the City’s currently amortized, unfunded accrued actuarial liability (the “Pension Liability”) to the California Public Employees’ Retirement System (“CalPERS”) with respect to the City’s defined benefit retirement plans for City employees; and (ii) to pay costs of issuance of the Bonds. See the caption “PLAN OF REFINANCING.” The obligation of the City to make all payments of interest on and principal of the Bonds when due, are absolute and unconditional, without any right of set-off or counterclaim. The Bonds are not limited as to payment to any special source of funds of the City. THE BONDS DO NOT CONSTITUTE AN OBLIGATION OF THE CITY FOR WHICH THE CITY IS OBLIGATED TO LEVY OR PLEDGE ANY FORM OF TAXATION OR FOR WHICH THE CITY HAS LEVIED OR PLEDGED ANY FORM OF TAXATION. NEITHER THE BONDS NOR THE OBLIGATION OF THE CITY TO MAKE PAYMENTS ON THE BONDS CONSTITUTES AN INDEBTEDNESS OF THE CITY, THE STATE OR ANY OF ITS POLITICAL SUBDIVISIONS WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY DEBT LIMITATION OR RESTRICTION. The Bonds The City is a member of CalPERS, an agent multiple-employer public employee defined benefit pension plan. CalPERS provides retirement and disability benefits, annual cost-of-living adjustments and death benefits to plan members and beneficiaries. CalPERS acts as a common investment and administrative agent for participating public entities within the State, including the City. As such, the City is obligated by the Public Employees’ Retirement Law, constituting Part 3 of Division 5 of Title 2 of the California Government Code (the “Retirement Law”), and the contract, dated July 1, 1948 (as amended, the “CalPERS Contract”), by and between the City Council of the City (the “City Council”) and the Board of Administration of CalPERS, to make contributions to CalPERS: (a) to fund pension benefits for City employees who are members of CalPERS; (b) to amortize the unfunded actuarial liability with respect to such pension benefits; and (c) to appropriate funds for such purposes.