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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />AUGUST 2, 2010 <br />TITLE: <br />A RESOLUTION OF INTENT TO ISSUE <br />BONDS - DOWNTOWN PARKING <br />FACILITIES <br />f <br />f <br />dITY MANAGER <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />APPROVED <br />? As Recommended <br />? As Amended <br />? Ordinance on I" Reading <br />? Ordinance on 2nd Reading <br />? Implementing Resolution <br />? Set Public Hearing For <br />CONTINUED TO <br />FILE NUMBER <br />Adopt a resolution of the City of Santa Ana regarding its intention to issue tax-exempt obligations <br />and to reimburse the Agency and City from proceeds of such obligations for costs incurred prior <br />to issuance for the Downtown Parking Facilities. <br />DISCUSSION <br />The American Recovery and Reinvestment Act (ARRA) of 2009 created new provisions to the <br />Internal Revenue Code allowing public agencies to designate "Recovery Zones" for the purpose <br />of issuing public and private bonds. Recovery Zone bonds allow for the issuance of debt with <br />lower borrowing costs for local governments and private entities to promote job creation and <br />economic recovery within adopted Recovery Zone boundaries. On August 17, 2009, the City <br />Council approved the designation of the Santa Ana Recovery Zone. The zone is comprised of <br />the entire City of Santa Ana, which includes the Redevelopment Agency's Merged <br />Redevelopment Project Area. <br />The City has received an allocation of $5,872,000 for tax exempt Recovery Zone Economic <br />Development Bonds. Recovery Zone Economic Development Bonds allow the City to finance <br />public infrastructure and public facilities. The Federal Government will remit to the City 45% of <br />the annual interest, resulting in a considerable cost savings to the issuer. <br />Capital improvements, including structural repairs, architectural enhancements and energy- <br />efficient improvements to the Downtown Parking Facilities, are proposed to be funded with the <br />proceeds of the Recovery Zone Economic Development Bond Program. It was anticipated that <br />CDBG funds would be used for these repairs; however, HUD has not issued the needed <br />clearances for funding. Further, the City does not have adequate cash reserves to directly fund <br />these repairs. <br />55A-1