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AGENDA REPORT
Date: March 12, 2001
TO: Mayor Campbell & Member of the City Council
THRU: Pamela Arends -King, Director of Administrative Services/Treasurer
FROM: John B. Bahorski, City Manager
SUBJECT: Contract Services For Arbitrage And Disclosure Requirements
For Bond And Certificates of Participation Debt Financing
SUMMARY OF REQUEST:
Staff requests City Council approve a proposal for the preparation of arbitrage and disclosure
reports. The issues identified as subject to these arbitrage and disclosure requirements are the
2000 Sewer Certificates of Participation; the 1991 Redevelopment Agency Subordinate Lien Tax
Allocation Bonds, Series A; the Surfside Assessment District 2000 Refunding Revenue Bonds;
and the Redevelopment Agency Tax Allocation Refunding Bonds, Series A & B.
DISCUSSION:
The City is required to prepare annual disclosure reports for it's current debt financing issues.
The disclosure reports are required pursuant to a covenant made by the Seal Beach Public
Financing Authority for the benefit of the holders of the Bonds and the Certificates of
Participation. The arbitrage compliance report is required by the Internal Revenue Service Code
under Section 148(f). Arbitrage compliance must be calculated and maintained annually and a
report must be submitted to the Internal Revenue Service every five years. Staff requests
MuniFinancial, a Willdan Company, perform these services for the City. MuniFinancial was
involved in the original financing of the Redevelopment Bonds, Sewer Certificates of
Participation and the Surfside 2000 Refunding Bonds and has a staff of highly qualified people
who specialize in performing the work needed to meet the requirements for the disclosure and
arbitrage reporting.
Agenda Item
r
March l2, 2001
Staff Report
Contract Services for Arbitrage and Disclosure Requirements
For bond and Certificates of Participation Financing
Page 2
FISCAL IMPACT:
The fees established for the annual disclosure reports are $2,000 for the Redevelopment Agency
Tax Allocation Refunding Bonds, series A & B; $1,500 for the Sewer Certificates of
Participation, Series 2000; and $1,500 for the Surfside Assessment District 2000 Refunding
Revenue Bonds. Total annual cost for the disclosure reports is $5,000.
The fees established for arbitrage compliance is $1,250 for the first year and $2,000 every fifth
year thereafter. The financing identified as being subject to arbitrage are the Surfside 2000
Refunding Revenue Bonds, the Redevelopment Agency Tax Allocation Refunding Bonds, Series
A & B, and the Sewer Certificates of Participation, Series 2000. Total cost for the first year of
service is $2,500. Total cost for services every fifth year is $4,000.
A final arbitrage compliance report will be prepared for the Redevelopment Agency 1991
Subordinate Lien Tax Allocation Bonds, Series A which was refunded December 27, 2000. The
fees for this service are not to exceed $3,000.
The fees paid to MuniFinancial will be paid out of the Sewer Enterprise Fund, the Riverfront
Project Redevelopment Fund and the Surfside Assessment District Fund. There will be no fiscal
impact to the General Fund.
RECOMMENDATION:
Approve the proposal for disclosure and arbitrage services to be completed by MuniFinancial
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��Pamela Arends -King
Director of Administrative Services/Treasurer