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Home My WebLink About7 Study Session PPT Financing Options ir 55 ion. `� i13� I hem 2/13/2017 Financing Options nesenweinw 4 om-occeafgeacA .17; 0 Pier Improvements Pier Utility Upgrade Project > Pier.improvements—approximately$3,885,000 • Emergency repairs and installation of a bathroom at the end of the Per • Re-designing the fire line to be installed above deck • Waterline > Design and bid specifications currently in process > 12-month completion period > Emergency project—need to complete it as soon as possible 1 4 2/13/2017 • Financing Options > General Financing Tools for.Ports,Harbors,Marinas and Piers • State Department of Parks and Recreation,Division of Boating and Waterways Loan-for marina improvements, payable from Tidelands Fund(marina revenues) • Marina Revenue Bonds-secured by Net Revenues of a city's municipal marina system • Harbor Revenue Bonds-secured by revenues from the use and operation of a port/harbor • Lease Revenue Bonds-secured by general fund lease payments Financing Options (Cont'd) > Financing Options available to the City of Seal Beach • General.fund lease revenue bonds ✓Secured by rental payments pursuant to a lease ✓Available Tidelands Fund revenues pledged as well ✓Require an asset transfer-unencumbered City-owned asset(s) pledged as collateral for the bonds ✓Issued through a joint powers authority,like a public financing authority /Direct placement with a bank or.a negotiated public sale 7 fw _. __ rm...vv.mo s Seal Beach Pier Financing Options IS > General fund lease revenue bonds • Need to form a new joint powers authority(WA) /Current WA formed by the City and the former Redevelopment Agency now the successor Agency) /Dissolution Act provides that the SA will terminate its existence within one year following the date when all SA debt has been retired or paid off 19/1/2023 2000 series A Tax Allocation Bonds) 'To ensure the City has access to a WA for assistance with future long-tel- in financings,City could: • Amend the existing WA to add a new counterparty to the City and remm4'the SA as a party-requires 05 and DOF approval land resulting delay) • Form a new joint powers entity-this is the route being pursued by the City 2 2/13/2017 • Formation of a new]PA > Created between-the Gity;and a.public entity • Best rounterparty for a new IPA agreement with the City would be.the Seal Beach Industrial Development Authority(IDA) /A new entity governed by the City Council that could enter into a SPA with the City > Statutory purpose•of the IDA:increase opportunities for useful.employment orotherwise contribute to economic development • The IDA will advance this purpose by forming a WA with the City' • IDA formed by adoption of an Ordinance—effective 30 days after 2nd reading - -• Afterwards,adoption of Resolution approving new SPA agreement and executing IPA agreement Fauna.PBEBT Fah—,uma Financing Considerations > Useful life of improvements determines term of borrowing— typically 10-15 years > Timing of Pier lease renewal with the State-and lease term > Timing of project approval by the Coastal Commission > Type of improvements—public vs.private.use > Estimated length of project completion > Method of Sale—public sale or private placement • Borrowing size • Financial flexibility:cost,time,rating,continuing disclosure,etc. > Available unencumbered essential City assets a Financing.Considerations iconed7 > The.Lease revenue bond proceeds cart be usedtfor both the Pier improvements and the new swimming pool- potential borrowing needs of$5.735 million • Same considerations apply: /Final maturity /Use of proceeds /Borrowing size and method of sale /Collateral Himm.ot _._ „,w,u.mv 9 3 I 2/13/2017 • Water Fund Improvements Water Capital Fund Projects '> Approximately$10.825 million Fes^ Po! D pl�ii Af R4 wµ 'i:s*—is:nd.a SIeroiea co.l. 1P rcr5rnmrn Rdtth—BcrcAPpbeov SS2illpxi \Im IL4cmoir Cllnnnrvtlmr0rntam L'pgnJoF SIIX!4n \COr Onnyc sm �mu_tor\l'n¢rGnc 44tmaoo S075An \\him'nssrer\.e tiatc,\Iio xrclx.emext 52.e0 ilxu -105'\idnnng Water toot Itemnfgnrxllon 515!1[1x1 IAmpmn Ore Ai'nar Main Relplxcemam SI,➢w, > Critical nature > Current schedule contemplates projects being fully bid and under construction within 12 months • Completion anticipated within 36 months Financing Alternatives ) > State Water Resources Control Board Loan-SRF Loan > California Department of Water Resources Loam > California Infrastructure and Economic Development Bank(I-Bank)Loan > Water Revenue Bonds—public sale or private placement 4 2/13/2017 Financing Considerations > State Loan Programs: • Secured by the rates,and charges of the water fund • Eligibility of projects • Lang lead time • Loan proceeds issued as projects progress • Debt service payment commences 1 year after project completion • Annual administrative costs(I-Bank loan) > Water Revenue Bonds—public sale or private placement • Secured by the rates and charges of the water fund • Greater structuring Flexibility and ease of execution Financing Considerations(Coned) ,?� > Evaluate financing alternatives from along-term perspective • 5-Year Water Fund CIP •-Long-Term Strategy—Establish City's Credit Profile • Attractive interest rates • Long project useful life—typically 30 years—better suited for a 'public sale • How would future needs fit in? > Water Revenue Bonds • City is in control • Allows for future parity debt • Best way to spread costs between current and future users of the Water System • Issued through the newly formed IPA jmo Bw? r.Mm..u.tuv u 9 Storm Water Improvements 5 2/13/2017 Storm Drain Projects > City has storm water/storm drain•projects to consider • West End Pump Station-Emergency Proclamation Project No. EM1701 • 3 notable flooding areas within the City: Old Town-West of Main St./south of PCH Old Town-Seal Walk and from 101h St.to Dolphin Ave. /College Park East ;mr nji roamyr_nn ie Storm Water/Storm Drain Funding • • > National Pollutant Discharge Elimination System(NPDES) • Introduced by the 1972 Clean Water Act(CWAI'.-a permit system for regulating point sources of pollution • Point sources include:industrial facilities,municipal governments,other government facilities,and some agricultural facilities • Storm water projects that are not required as part of a NPDES permit can be funded through the CWA section 319 nonpoint source grant program administered by states • NPDES nonpoint source funding won't apply as NPOES applies to Seal Beach > Clean Water State Revolving Fund(CWSRF) • Helps communities prevent pollution of water resources to maintain their beneficial uses • Eligible applicants:city,town,district,or other public body created under state law,including state agencies • Eligible projects include storm water treatment • Seal Beach can apply for a 30 year loan ._..,t irvv,an�,.,n�r Ir Storm Water/Storm Drain Funding(Cont'd) of > CA'Storm Water Grant Program(SWGP) • Promotes the beneficial use of storm water and dry weather runoff by providing financial assistance to eligible applicants for projects that provide multiple benefits while improving water quality • Funded by both Prop 1 and Prop 06;eligible applicants:local public agencies • Prop 1 projects may include,but shall not be limited to,green infrastructure,rainwater and storm water capture projects and storm water treatment facilities • Dollar limits;planning(550K to S500K)and Implementation(5250K to MOM)-applications for implementation round 2 are tentative for 2018 • Requires 50%match and only for multi-benefit storm water management projects • Prop 89 projects may include those designed to reduce and prevent storm water contamination of rivers,lakes,and streams-had two rounds already; no word yet of a 5,a round • . u '• •• ,untiLatleast2Vlfl 6 2/13/2017 Storm Water/Storm Drain Funding > State Community Development Block Grant(CDBG) • Each state can administer CDBG funds for non-entitlement areas General local government hefts wblcl do not receive CDBG funds directly from the Federal Housing and Urban Development 114UDI Cities with populations of less than 50,000(except those designated principal cities of Metropolitan Statistical Areas( V Counties with populations of less than 200,000 • Provides funds to states to principally benefit low income people, elim nate'slumsand blight,and/or meet an urgent community development need• Not less than 70%Of CDBG Ponds must be used for activities that benefit lowf and moderate-income persons • Seal Beach appears eligible for a grant to be used primarily for low- to moderate-income' }nwu.y . ._- r.n,r.si3.soi, tr Storm Water/Storm Drain Funding r > I-Bank Infrastructure State Revolving Fund(ISRF)Loan. • The ISRF Program provides financing to public agencies and non-profit corporations sponsored by public agencies for a wide variety of infrastructure and economic development projects • Eligible applicants:cities,counties,special districts,assessment districts,joint powers authorities and non-profit corporations • Eligible projects:drainage,water supply and flood control, sewage collection and treatment,solid waste collection and disposal,and water treatment and distribution • Seal Beach is eligible for an I-Bank loan Financing Considerations and Other Funding Options kcise > State Joan Programs: • rligibillly of projects • Long lead time • Joan proceeds Issued as projects Pr ogress • Debt admipaymentCommences 3 year after project completion • Annual al administrative costs(I-Bank leant > State Grant Programs: • Requires funding match • Eligibility of projects • May need todelav eroien. I • Restriction of fund usage • Additional requirements and reports > OtherFunding Options: • Need community support • Parcel Tax-2/3bote • Assessment Dknlcl Bonds-majority protest required to form an AD •Ht .�.-W- rra'a,ni3.x0ir 7