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Home My WebLink About75B - PH GOODWILL TEFRA CITY COUNCIL MEETING DATE: CLERK OF COUNCIL USE ONLY: REQUEST FOR COUNCIL ACTION OCTOBER 6, 2008 TITLE: PUBLIC HEARING ON ISSUANCE OF TAX EXEMPT BONDS FOR GOODWILL INDUSTRIES OF ORANGE COUNTY FACILITIES AND RESOLUTION APPROVING THE ISSUANCE OF BONDS APPROVED D As Recommended D As Amended D Ordinance on 151 Reading D Ordinance on 2nd Reading D Implementing Resolution D Set Public Hearing For CONTINUED TO ~~~ FILE NUMBER RECOMMENDED ACTION 1. Conduct a Tax Equity and Financial Responsibility Act (TEFRA) Hearing in consideration of the issuance of tax exempt bond financing by the California Municipal Finance Authority on behalf of Goodwill Industries of Orange County, California, a nonprofit public benefit corporation, for the purpose of financing the acquisition, construction, improvement and equipping of certain facilities located at 1601 East St. Andrew Place and 410 North Fairview Street, Santa Ana. 2. Adopt a resolution approving the issuance of variable rate revenue demand bonds by the California Municipal Finance Authority in an amount not to exceed $8,000,000 for the purpose of financing the acquisition, construction, improvement and equipping of certain facilities located at 1601 East St. Andrew Place and 410 North Fairview Street, Santa Ana. DISCUSSION Goodwill Industries is an independent charitable organization that strives to provide people with disabilities personal and economic independence. Goodwill of Orange County serves more than 800 children and adults during their daily operations and is a leading nonprofit provider of education, training, and career services to disadvantaged individuals. In order to enhance their ability to provide opportunities for the disadvantaged, Goodwill Industries of Orange County is proposing the acquisition, construction, improvement and equipping of a 28,502 square foot industrial property located at 1601 East St. Andrew Place, Santa Ana, California. The facility will house a fitness center to serve persons with disabilities, classroom space to train disabled persons in the use of assistive technology and Landmark Services, Inc. ("Landmark") to provide document destruction services. In order to purchase and gain favorable tax exempt financing, Goodwill Industries has requested the assistance of the California Municipal Finance Authority (Authority). The 758-1 Issuance of Tax Exempt Bonds for Goodwill Industries of Orange County Facilities October 6, 2008 Page 2 Authority, which was established in 2004, was formed to assist nonprofit organizations and businesses with the issuance of taxable and tax exempt bonds. The Authority is seeking to issue variable rate revenue demand bonds in an amount not to exceed $8,000,000. No more than $7,250,000 of proceeds will be used for acquisition. Certain leasehold improvements, fixtures, and equipment at the Borrower's retail store facility located at 3021 West Lincoln Avenue, Anaheim, California, will account for no more than $710,000 of proceeds of the Bonds, and certain building improvements at the Borrower's administrative offices located at 410 North Fairview Street, Santa Ana, California, will account for the balance of Bond proceeds. The Project is to be owned and operated by the Borrower, provided that approximately 10,000 square feet of the industrial property referred to above will be leased to Landmark Services, Inc. for the document destruction services. Both the Borrower and Landmark, are California nonprofit public benefit corporations and organizations described in Section 501 (c) (3) of the Code. In order for all or a portion of the Bonds to qualify as tax-exempt bonds, the City of Santa Ana must conduct a public hearing (the "TEFRA Hearing") providing for the members of the community an opportunity to speak in favor of or against the use of tax-exempt bonds for the financing of the Project. Following the close of the TEFRA Hearing, the City must provide its approval for the issuance of the Bonds by the Authority for financing the Project. The bonds to be issued by the Authority are the sole responsibility of the borrower. The City has no financial or legal liability for the project or repayment of the bonds and does not constitute any type of indebtedness for the City. FISCAL IMPACT There is no fiscal impact to the City. ':\- (\1)~~ ~'l' c> ~ ~ . ~ .:,) Francisco Gutierrez Executive Director Finance & Management Services Agency 758-2 jwf 9/09/2008 RESOLUTION NO. 2008- RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA APPROVING THE ISSUANCE OF THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY VARIABLE RATE DEMAND REVENUE BONDS (GOODWILL INDUSTRIES OF ORANGE COUNTY, CALIFORNIA), SERIES 2008 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $8,000,000 FOR THE PURPOSE OF FINANCING THE ACQUISITION, CONSTRUCTION, IMPROVEMENT AND EQUIPPING OF CERTAIN FACILITIES AND CERTAIN OTHER MATTERS RELATING THERETO BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1, The City Council of the City of Santa Ana hereby finds, determines and declares as follows: A. Goodwill Industries of Orange County, California, a nonprofit public benefit corporation and an organization described in Section 501 (c)(3) of the Internal Revenue Code of 1986 (the "Borrower"), has requested that the California Municipal Finance Authority (the "Authority") participate in the issuance of one or more series of revenue bonds in an aggregate principal amount not to exceed $8,000,000 (the "Bonds") for (a) the acquisition, construction, improvement and equipping of a 28,502 square foot industrial property located at 1601 East St. Andrew Place, Santa Ana, California to accommodate a fitness center to serve persons with disabilities, facilities to train disabled persons in the use of assistive technology, facilities for document destruction to be operated by Landmark Services, Inc. ("Landmark") and/or for other purposes of Borrower, collectively accounting for no more than $7,250,000 of proceeds of the Bonds, (b) certain leasehold improvements, fixtures, and equipment at the Borrower's retail store facility located at 3021 West Lincoln Avenue, Anaheim, California, accounting for no more than $710,000 of proceeds of the Bonds, and (c) certain building improvements at the Borrower's administrative offices located at 410 North Fairview Street, Santa Ana, California, accounting for no more than $100,000 of proceeds of the Bonds, (collectively, the "Project") to be owned and operated by the Borrower and portions of which will be located within the City of Santa Ana (the "City"); and B. Pursuant to Section 147(f) of the Internal Revenue Code of 1986 (the "Code"), the issuance of the Bonds by the Authority must be approved by the City because a portion of the Project is to be located within the territorial limits of the City; and 758-3 C. The City Council of the City (the "City Council") is the elected legislative body of the City and is one of the "applicable elected representatives" required to approve the issuance of the Bonds under Section 147(f) of the Code; and D. The Authority has requested that the City Council approve the issuance of the Bonds by the Authority in order to satisfy the public approval requirement of Section 147(f) of the Code and the requirements of Section 4 of the Joint Exercise of Powers Agreement Relating to the California Municipal Finance Authority, dated as of January 1, 2004 (the "Agreement"), among certain local agencies, including the City; and E. Pursuant to Section 147(f) of the Code, the City Council has, following notice duly given, held a public hearing regarding the issuance of the Bonds, and now desires to approve the issuance of the Bonds by the Authority. Section 2. The City Council hereby approves the issuance of the Bonds by the Authority. It is the purpose and intent of the City Council that this resolution constitute approval of the issuance of the Bonds by the Authority, for the purposes of (a) Section 147(f) of the Code by the applicable elected representative of the governmental unit having jurisdiction over a portion of the area in which the Project is to be located, in accordance with said Section 147(f) and (b) Section 4 of the Agreement. Section 3, The adoption of this Resolution shall not obligate the City or any department thereof to: (i) provide any financing to acquire or construct the Project or any refinancing of the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, rehabilitation or operation of the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the Authority or its membership therein, Section 4, The City Manager, the Director of Finance and Management Services, the Clerk of the Council and all other proper officers and officials of the City are hereby authorized and directed to execute such other agreements, documents and certificates, and to perform such other acts and deeds, as may be necessary or convenient to effect the purposes of this Resolution and the transactions herein authorized, Section 5. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. 7SEf-4 ADOPTED this day of October, 2008, Miguel A. Pulido Mayor APPROVED AS TO FORM: Joseph W. Fletcher, City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, PATRICIA E, HEALY, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2008-XXX to be the original resolution adopted by the City Council of the City of Santa Ana on ,2008. Date: Patricia E. Healy Clerk of the Council City of Santa Ana 3 758-5 758-6