2020 12 15 SA Special MeetingSUCCESSOR AGENCY TO RDA 1 DECEMBER 15, 2020
SPECIAL MEETING
NOTICE AND CALL OF SPECIAL MEETING
OF THE SUCCESSOR AGENCY TO THE LA QUINTA
REDEVELOPMENT AGENCY
TO THE MEMBERS OF THE SUCCESSOR AGENCY TO THE LA QUINTA
REDEVELOPMENT AGENCY AND TO THE CITY CLERK/AGENCY
SECRETARY:
NOTICE IS HEREBY GIVEN that a Special Meeting of the La Quinta
Successor Agency is hereby called to be held on Tuesday, December 15,
2020, starting at 4:00 p.m.; at La Quinta City Hall located at 78495 Calle
Tampico, La Quinta, CA 92253. Pursuant to Executive Orders N-25-20, N-
29-20, N-33-20, N-35-20, and N-60-20, executed by the Governor of
California, and the directives under the “Regional Stay At Home Order” from
the California Department of Public Health, in response to the state of
emergency relating to novel coronavirus disease 2019 (COVID-19) and
enabling teleconferencing accommodations by suspending or waiving
specified provisions in the Ralph M. Brown Act (Government Code § 54950
et seq.), members of the Successor Agency, the Executive Director, Agency
Counsel, City Staff, and City Consultants may participate in this special
meeting by teleconference. Additionally, pursuant to the above-referenced
orders, members of the public are instructed to stay at home and to limit
mixing with other persons or households as much as possible. Therefore,
members of the public temporarily are not permitted to physically attend at
City Hall the meeting to which this agenda applies, but any member of the
public may listen or participate in this special meeting as specified below.
Members of the public wanting to listen to this special meeting may do
so by tuning-in live via http://laquinta.12milesout.com/video/live.
Members of the public wanting to address the Successor Agency, either
for public comment or for a specific agenda item, or both, are requested to
send an email notification to the La Quinta City Clerk’s Office at
CityClerkMail@LaQuintaCA.gov, and specify the following information:
1) Full Name 4) Public Comment or Agenda Item Number
2) City of Residence 5) Subject
3) Phone Number 6) Written or Telephonic Verbal Comments
SUCCESSOR AGENCY TO RDA 2 DECEMBER 15, 2020
SPECIAL MEETING
The email “subject line” must clearly state “Written Comments” or
“Telephonic Verbal Comments.”
The special meeting is called for the following purpose:
CONSENT CALENDAR
1. APPROVE SPECIAL MEETING MINUTES OF OCTOBER 6, 2020
BUSINESS SESSION
1. ADOPT A FIRST AMENDED AND RESTATED RESOLUTION FOR
ISSUANCE AND SALE OF TAX ALLOCATION REFUNDING BONDS
[RESOLUTION NO. SA 2020-002]
Dated: December 11, 2020 Linda Evans
LINDA EVANS, Chairperson
Attest:
MONIKA RADEVA
Housing Authority Secretary
DECLARATION OF POSTING
I, Monika Radeva, Authority Secretary, do hereby declare that the foregoing
notice for the La Quinta Housing Authority Special Meeting of December
15, 2020 was posted on the outside entry to the Council Chamber at 78495
Calle Tampico and on the bulletin boards at 51321 Avenida Bermudas and
78630 Highway 111 on December 11, 2020.
DATED: December 11, 2020
Monika Radeva, Authority Secretary
La Quinta Housing Authority
SUCCESSOR AGENCY TO RDA AGENDA 1 DECEMBER 15, 2020
SPECIAL MEETING
SUCCESSOR AGENCY
To The La Quinta Redevelopment Agency
AGENDA
CITY HALL COUNCIL CHAMBER
78495 Calle Tampico, La Quinta
SPECIAL MEETING
TUESDAY, DECEMBER 15, 2020 at 4:00 P.M.
******************************
SPECIAL NOTICE
Teleconferencing and Telephonic Accessibility In Effect
Pursuant to Executive Orders N-25-20, N-29-20, N-33-20, N-35-20, and N-60-
20, executed by the Governor of California, and the directives under the
“Regional Stay At Home Order” from the California Department of Public Health,
in response to the state of emergency relating to novel coronavirus disease 2019
(COVID-19) and enabling teleconferencing accommodations by suspending or
waiving specified provisions in the Ralph M. Brown Act (Government Code
§ 54950 et seq.), members of the Successor Agency, the Executive Director,
Agency Counsel, City Staff, and City Consultants may participate in this special
meeting by teleconference. Additionally, pursuant to the above-referenced
orders, members of the public are instructed to stay at home and to limit mixing
with other persons or households as much as possible. Therefore, members of
the public temporarily are not permitted to physically attend at City Hall the
meeting to which this agenda applies, but any member of the public may listen
or participate in this meeting as specified below.
Members of the public wanting to listen to this meeting may do so by tuning-
in live via http://laquinta.12milesout.com/video/live.
Members of the public wanting to address the Successor Agency, either for
public comment or for a specific agenda item, or both, may do so via
teleconference by sending an email notification to the La Quinta City Clerk’s
Office at CityClerkMail@LaQuintaCA.gov, and specify the following information:
Successor Agency agendas and staff
reports are now available on the City’s
web page: www.laquintaca.gov
SUCCESSOR AGENCY TO RDA AGENDA 2 DECEMBER 15, 2020
SPECIAL MEETING
1) Full Name 4) Public Comment or Agenda Item Number
2) City of Residence 5) Subject
3) Phone Number 6) Written or Telephonic Verbal Comments
The email “subject line” must clearly state “Written Comments” or
“Telephonic Verbal Comments.”
Telephonic verbal public comments – requests to speak must be emailed
to the City Clerk no later than 3:00 p.m. on the day of the meeting; the
City will facilitate the ability for a member of the public to be audible to the
Successor Agency, and general public for the item(s) by contacting him/her via
phone and queuing him/her to speak.
Only one person at a time may speak by telephone and only after being
recognized by the Chairperson.
Written public comments must be received by the City Clerk’s Office no
later than 3:00 p.m. on the day of the meeting, and will be distributed to the
Successor Agency, incorporated into the agenda packet and public record of the
meeting, and will not be read during the meeting unless, upon the request of the
Chairperson, a brief summary of any public comment is asked to be read, to the
extent the City Clerk’s Office can accommodate such request.
It would be appreciated that any email communications for public comments
related to the items on the agenda, or for general public comment, are provided
to the City Clerk’s Office at the email address listed above prior to the
commencement of the meeting. If that is not possible, and to accommodate
public comments on items that may be added to the agenda after its initial
posting or items that are on the agenda, every effort will be made to attempt to
review emails received by the City Clerk’s Office during the course of the
meeting. The Chairperson will endeavor to take a brief pause before action is
taken on any agenda item to allow the City Clerk to review emails and share any
public comments received during the meeting. All emails received by the City
Clerk, at the email address above, until the adjournment of the meeting, will be
included within the public record relating to the meeting.
******************************
CALL TO ORDER
ROLL CALL:
Agency Members: Fitzpatrick, Peña, Radi, Sanchez, Chairperson Evans
PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA
At this time, members of the public may address the Successor Agency on any
matter not listed on the agenda by emailing written public comments or
SUCCESSOR AGENCY TO RDA AGENDA 3 DECEMBER 15, 2020
SPECIAL MEETING
requests to provide verbal public comments via teleconference as indicated
above. Please limit your comments to three (3) minutes (or approximately 350
words). The Successor Agency values your comments; however, in accordance
with State law, no action shall be taken on any item not appearing on the agenda
unless it is an emergency item authorized by GC 54954.2(b).
CONFIRMATION OF AGENDA
CONSENT CALENDAR
PAGE
1. APPROVE SPECIAL MEETING MINUTES OF OCTOBER 6, 2020 5
BUSINESS SESSION
PAGE
1. ADOPT A FIRST AMENDED AND RESTATED RESOLUTION FOR
ISSUANCE AND SALE OF TAX ALLOCATION REFUNDING BONDS
[RESOLUTION NO. SA 2020-002]
7
CHAIR AND BOARD MEMBERS' ITEMS
ADJOURNMENT
*************************************
For information about the next special meeting of the City as Successor Agency
to the La Quinta Redevelopment Agency, please contact the City Clerk’s Office
at (760) 777-7035.
DECLARATION OF POSTING
I, Monika Radeva, Agency Secretary of the City as Successor Agency to the La
Quinta Redevelopment Agency, do hereby declare that the foregoing agenda was
posted near the entrance to the Council Chambers at 78495 Calle Tampico and
on the bulletin boards at the La Quinta Cove Post Office at 51321 Avenida
Bermudas and the Stater Brothers Supermarket at 78630 Highway 111, on
December 11, 2020.
DATED: December 11, 2020
MONIKA RADEVA, Agency Secretary
Successor Agency to the La Quinta Redevelopment Agency
SUCCESSOR AGENCY TO RDA AGENDA 4 DECEMBER 15, 2020
SPECIAL MEETING
Public Notices
The La Quinta City Council Chamber is handicapped accessible. If special equipment
is needed for the hearing impaired, please call the City Clerk’s Office at (760)
777-7092, twenty-four (24) hours in advance of the meeting and accommodations
will be made.
If special electronic equipment is needed to make presentations to the Successor
Agency, arrangement should be made in advance by contacting the City Clerk's
Office at (760) 777-7092. A one (1) week notice is required.
If background material is to be presented to the Successor Agency during a meeting,
please be advised that eight (8) copies of all documents, exhibits, etc., must be
supplied to the City Clerk for distribution. It is requested that this take place prior
to the beginning of the meeting.
Any writings or documents provided to a majority of the Successor Agency regarding
any item on this agenda will be made available for public inspection at the City Clerk
counter at City Hall located at 78495 Calle Tampico, La Quinta, California, 92253,
during normal business hours.
CITY AS SUCCESSOR AGENCY TO RDA Page 1 of 2 OCTOBER 6, 2020
SPECIAL MEETING
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
MINUTES
TUESDAY, OCTOBER 6, 2020
CALL TO ORDER
A Special Meeting of the La Quinta City Council in their capacity as Successor
Agency to the La Quinta Redevelopment Agency (“SA”) was called to order
at 8:40 p.m. by Chairperson Evans.
This meeting provided teleconference accessibility pursuant to Executive
Orders N-25-20, N-29-20, N-33-20, and N-35-20, executed by the Governor
of California in response to the state of emergency relating to novel
coronavirus disease 2019 (COVID-19) and enabling teleconferencing
accommodations by suspending or waiving specified provisions of the Ralph
M. Brown Act (Government Code §54950 et seq.).
PRESENT: Agency Members Fitzpatrick, Radi, Sanchez, Chair Evans
ABSENT: Agency Member Peña
STAFF PRESENT: Executive Director McMillen, Agency Counsel Ihrke, Agency
Secretary Radeva, Deputy City Clerk Romane, Finance Director Romero
PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA – None
CONFIRMATION OF AGENDA – Confirmed
BUSINESS SESSION
1. ADOPT A RESOLUTION FOR ISSUANCE AND SALE OF
SUBORDINATE TAX ALLOCATION REFUNDING BONDS
[RESOLUTION NO. SA 2020-001]
Finance Director Romero presented the staff report, which is on file in the
Clerk’s Office.
Agency Members discussed that it is anticipated for interest rates to remain
low over the next five (5) months until the bond refinance is completed.
PUBLIC SPEAKER via TELEPHONIC ACCESSIBILITY: Robin Thomas, SVP,
Managing Director with Hilltop Securities, Inc. – said the upcoming
CONSENT CALENDAR ITEM NO. 1
5
CITY AS SUCCESSOR AGENCY TO RDA Page 2 of 2 OCTOBER 6, 2020
SPECIAL MEETING
November 3, 2020 election could affect the interest rates, however, due to
COVID-19, additional market volatility is very low.
Finance Director Romero said she, City Manager McMillen, and Financial
Services Analyst Hallick will be the point Staff member on the Last and Final
Recognized Obligation Payment amendment, which will be initiated following
the bond refinance.
Council discussed the Riverside County Oversight Board membership and
appointment process.
MOTION – A motion was made and seconded by Agency Members
Fitzpatrick/Sanchez to adopt Resolution No. SA 2020-001 authorizing the
issuance and sale of Subordinate Tax Allocation Refunding Bonds by the
Successor Agency to the La Quinta Redevelopment Agency in the
approximate amount of $99,210,000, 2021 Taxable Series A, and authorize
certain actions in connection therewith as recommended:
A RESOLUTION OF THE SUCCESSOR AGENCY TO LA QUINTA
REDEVELOPMENT AGENCY AUTHORIZING THE ISSUANCE AND
SALE OF SUBORDINATE TAX ALLOCATION REFUNDING BONDS
APPROVING THE FORM OF A THIRD SUPPLEMENTAL INDENTURE
OF TRUST, OFFICIAL STATEMENT, BOND PURCHASE CONTRACT,
CONTINUING DISCLOSURE AGREEMENT, FORM OF ESCROW
AGREEMENT, AND RELATED DOCUMENTS AND AUTHORIZING
CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH
Motion passed: ayes 4, noes 0, absent 1 (Peña)
CHAIR AND AGENCY MEMBERS' ITEMS
REPORTS AND INFORMATIONAL ITEMS – None
ADJOURNMENT
There being no further business, it was moved and seconded by Agency
Members Radi/Sanchez to adjourn at 8:59 p.m. Motion passed: ayes 4,
noes 0, absent 1 (Peña).
Respectfully submitted,
MONIKA RADEVA, Agency Secretary
Successor Agency to the dissolved
La Quinta Redevelopment Agency
6
City of La Quinta
SUCCESSOR AGENCY MEETING: December 15, 2020
STAFF REPORT
AGENDA TITLE: ADOPT A FIRST AMENDED AND RESTATED RESOLUTION
FOR ISSUANCE AND SALE OF TAX ALLOCATION REFUNDING BONDS
RECOMMENDATION
Adopt a First Amended and Restated Resolution authorizing the issuance and
sale of Tax Allocation Refunding Bonds by the Successor Agency to the La
Quinta Redevelopment Agency in the approximate amount of $157,470,000,
2021 Taxable Series A, and authorize certain actions in connection therewith.
EXECUTIVE SUMMARY
•In 2013, the La Quinta Successor Agency (SA) issued $97,190,000 of
Subordinate Tax Allocation Refunding Bonds, 2013 Series A of which
$69,990,000 are currently outstanding and $23,055,000 Subordinate
Tax Allocation Refunding Bonds, 2013 Taxable Series B of which
$16,375,000 are currently outstanding (together the “2013 Bonds”).
•In 2014, the La Quinta SA issued $65,600,000 of Tax Allocation
Refunding Bonds, 2014 Series A of which $52,095,000 are currently
outstanding (the “2014 Bonds”).
•Resolution No. 2020-001 was adopted by the SA on October 6, 2020 to
refinance 2013 Bonds, and a companion resolution was approved by the
County of Riverside Oversight Board and sent to the State Department
of Finance for approval.
•Staff and the Successor Agency’s financing team have determined that
it makes economic sense to include the refunding of the Successor
Agency’s 2014 Bonds with additional savings of approximately $1.7
million.
•Current bond interest rates remain at historically low levels and
refinancing the 2013 and 2014 Bonds will reduce annual bond
payments, allowing additional property tax revenue distribution to the
City and local taxing agencies.
BUSINESS SESSION ITEM NO. 1
7
•By refunding the 2013 Bonds and 2014 Bonds together the Successor
Agency will preserve one of its two allowed Last and Final Recognized
Obligation Payment (ROPS) amendments, secure additional savings on
future debt service payments and revise bond indenture covenant
language put in place before the Successor Agency filed its Last and
Final ROPS in 2017.
•Refinancing the 2013 and 2014 Bonds will require approvals from the
County of Riverside Oversight Board, currently only meeting virtually
every other month and the State Department of Finance (DOF)
approval, which may take up to 60 days after receipt of Oversight Board
approval.
•The proposed 2021 bond refinancing was presented to and supported
by the Financial Advisory Commission (FAC) on September 30, 2020
with a subsequent verbal update on December 2, 2020.
•The First Amended and Restated Resolution amends and restates
Resolution No. 2020-001 in its entirety.
FISCAL IMPACT
Lower bond interest costs will result in lower annual debt service payments by
an average of $608,300 or $8.52 million over the fourteen-year term of the
2021 Bonds. The cost of issuing the Bonds is anticipated to be $375,000,
which includes reimbursement for City Staff time. The 2021 Bonds will be
issued as fixed rate Bonds paying interest semi-annually on the same dates
with the same maturity as the existing 2014 Bonds on September 1, 2034.
BACKGROUND/ANALYSIS
Starting in 1985, the La Quinta Redevelopment Agency (RDA) issued tax
allocation bonds to raise capital for infrastructure, public facility, economic
development, and affordable housing investment. Bond debt service
payments are funded by property tax revenue. When the RDA was eliminated
in February 2012, the Successor Agency assumed the responsibility to ensure
that bond debt service payments are made. These payments are classified as
enforceable obligations and are tracked on the Recognized Obligation Payment
Schedule (ROPS) filed by Staff and approved by the DOF.
The Successor Agency may refinance outstanding bonds and other obligations
of the RDA as long as certain conditions are met, primarily a reduction of
annual debt service. In the Summer of 2020, the City’s financial advisors
determined that today’s lower bond interest rates would produce such debt
service savings for the 2013 Bonds and upon further review additional savings
of approximately $1,694,000 were identified if the 2014 Bonds are added to
the proposed 2021 Bond refinance.
8
All bond refinancing must be first approved by the Riverside County Oversight
Board and the State DOF. If approved, the Amended and Restated Resolution
would be presented to the County Oversight Board on January 7, 2021 and
subsequently submitted to the State DOF.
Summary of 2013 and 2014 Bonds
On December 17, 2013 the Successor Agency issued subordinate tax
allocation refunding bonds in the amount of $97,190,000 Series A Bonds and
$23,055,000 Taxable Series B Bonds to refinance outstanding long-term
obligations previously issued by the former Redevelopment Agency. Interest
rates on the 2013 Series A tax allocation bonds range from 3% to 5% while
interest rates on the 2013 Taxable Series B tax allocation bonds range from
4.89% to 5.82%.
On June 1, 2014, the Successor Agency issued tax allocation refunding bonds
in the amount of $65,600,000 Series A Bonds to refinance outstanding long-
term obligations previously issued by the former Redevelopment Agency.
Interest rates on the 2014 Series A tax allocation bonds range from 3% to
5%.
The current 2013 and 2014 Bond balances and maturity dates are as follows:
2013 Series A Bond Summary
Principal due as of 9/1/2020 $69,990,000
Interest due as of 9/1/2020 $24,494,109
Matures in 2033
2013 Taxable Series B Bond Summary
Principal due as of 9/1/2020 $16,375,000
Interest due as of 9/1/2020 $6,509,251
Matures in 2032
2014 Series A Bond Summary
Principal due as of 9/1/2020 $52,095,000
Interest due as of 9/1/2020 $21,582,750
Matures in 2034
Savings Analysis and Cost of Issuance
After redevelopment dissolution, Successor Agencies are only allocated
revenue in the amount necessary to pay enforceable obligations of the Former
Agency until all enforceable obligations have been paid in full. Assembly Bill
1X 26 provided that upon dissolution of the Redevelopment Agency, property
taxes allocated to redevelopment agencies no longer are deemed tax
increment but rather property tax revenues. Bond principal and interest
payments are payable solely from these property tax revenues and the bond
maturity dates will not be extended.
9
In the current bond market, an opportunity exists to further reduce annual
debt service by consecutively refinancing the 2013 and 2014 Bonds. Interest
rates for the 2021 refunding bonds are estimated to range from .97% to
2.60% and will be issued on a taxable basis. The 2013 and 2014 Series
Bonds have interest rates ranging from 3% to 5.82%.
By refinancing the 2013 and 2014 Bonds, debt service payments will be
reduced by an estimated $8.517 million over 14 years. This would free up
property tax revenue for distribution to other taxing agencies and the City,
with savings of approximately $5,323,100 to schools districts, $1,889,100 to
Riverside County, $614,100 to the Coachella Valley Water District, $450,500
to the City, and $240,200 to parks and recreation over the remaining 14 year
amortization period.
The cost of issuance is anticipated to be $375,000 and would include bond
counsel, disclosure counsel, financial advisor, rating services, verification
consultant, trustee and escrow bank fees, financial printing and
reimbursement for City Staff time. In addition, at the time the 2021 Bonds
are sold, the Underwriter will receive a discount for selling the Bonds. This
discount will be determined based on market conditions and will be approved
by the Financial Advisor and City Staff. The savings discussed above are after
all costs of issuance have been paid.
City Policy and Recommended Next Steps
The City, including the Successor Agency to the La Quinta Redevelopment
Agency, has adopted a Debt Management Policy which recommends a periodic
review of existing debt to identify refunding opportunities. Generally, the City
will seek to achieve debt service savings which, on a net present value (NPV)
basis, are at least 3% of the debt being refinanced. The anticipated debt
service NPV savings from this amended refinancing is 5.42%
Staff recommends proceeding with the amended refinancing. The anticipated
Financing Schedule is included as Attachment 1. Under this schedule the Bond
refinancing would close on or around February 17, 2021, assuming that the
Department of Finance approves the First Amended and Restated Resolution
in early January. After the Bonds are closed the City would proceed with a first
amendment to the last and final ROPS. The ROPS is a comprehensive schedule
which includes all bond debt service payments, City loan repayments,
administration, and annual reporting requirements of the Former Agency
through fiscal year 2039-40.
The initial refinancing was presented to the FAC on September 30, 2020. Key
aspects on the refinancing, requirements, costs, anticipated savings, and the
proposed timeline were discussed. Afterwards, the FAC supported staff’s
recommendation to proceed with the 2021 bond refinancing. On December 2,
2020 staff provided a verbal update stating the refinancing would likely be
amended to add the 2014 Bonds.
10
ALTERNATIVES
The refinancing would result in annual savings on bond debt service, adheres
to the City’s Debt Management Policy, and distribute additional funds to local
taxing agencies and the City, therefore staff does not recommend an
alternative.
Prepared by: Karla Romero, Finance Director
Approved by: Jon McMillen, City Manager/Executive Director
Attachments: 1.Third Supplemental Indenture Trust
2.Bond Purchase Contract
3.Preliminary Official Statement
4.Continuing Disclosure Agreement
5.Escrow Agreement
6.Summary of 2021 Refinancing
11
12
124/015610-0182
15505484.4 a12/10/20 -1-
RESOLUTION NO. SA 2020-XXX
A FIRST AMENDED AND RESTATED RESOLUTION
OF THE SUCCESSOR AGENCY TO LA QUINTA
REDEVELOPMENT AGENCY AUTHORIZING THE
ISSUANCE AND SALE OF TAX ALLOCATION
REFUNDING BONDS APPROVING THE FORM OF A
THIRD SUPPLEMENTAL INDENTURE OF TRUST,
PRELIMINARY OFFICIAL STATEMENT, BOND
PURCHASE CONTRACT, CONTINUING
DISCLOSURE AGREEMENT, ESCROW
AGREEMENT, AND RELATED DOCUMENTS AND
AUTHORIZING CERTAIN OTHER ACTIONS IN
CONNECTION THEREWITH
WHEREAS, the La Quinta Redevelopment Agency (the “Prior Agency”)
was a public body, corporate and politic, duly created, established and
authorized to transact business and exercise its powers under and pursuant
to the provisions of the Community Redevelopment Law (Part 1 (commencing
with Section 3300) of Division 24 of the Health and Safety Code of the State
of California) (the “Law”), and the powers of the Prior Agency included the
power to issue bonds for any of its corporate purposes; and
WHEREAS, a Redevelopment Plan for a redevelopment project known
and designated as the “La Quinta Redevelopment Project Area No. 1” has been
adopted and approved by Ordinance No. 43 of the City of La Quinta on
November 29, 1983, and all requirements of the Law for and precedent to the
adoption and approval of the Project Area No. 1 Redevelopment Plan, as
amended, have been duly complied with; and
WHEREAS, a Redevelopment Plan for a redevelopment project known
and designated as the “La Quinta Redevelopment Project No. Area 2” has been
adopted and approved by Ordinance No. 139 of the City of La Quinta on May
16, 1989, and all requirements of the Law for and precedent to the adoption
and approval of the Project Area No. 2 Redevelopment Plan, as amended, have
been duly complied with; and
WHEREAS, the Successor Agency previously issued $97,190,000
aggregate principal amount of the Successor Agency to the La Quinta
Redevelopment Agency, La Quinta Redevelopment Project Area Nos. 1 and 2,
Subordinate Tax Allocation Refunding Bonds, 2013 Series A (the “2013 Series
A Bonds”) pursuant to an Indenture of Trust and a First Supplemental
Indenture of Trust each dated as of December 1, 2013 (collectively the
“Original Indenture”) ; and
13
Resolution No. SA 2020 – xxx
RDA Amended Tax Allocation Refunding Bonds Refinance
Adopted: December 15, 2020
Page 2 of 9
124/015610-0182
15505484.4 a12/10/20 -2-
WHEREAS, the Successor Agency previously issued $23,055,000
aggregate principal amount of the Successor Agency to the La Quinta
Redevelopment Agency, La Quinta Redevelopment Project Area Nos. 1 and 2,
Subordinate Tax Allocation Refunding Bonds, 2013 Taxable Series B (the
“2013 Series B Bonds” and together with the 2013 Series A Bonds, the “2013
Bonds”) pursuant to the Original Indenture; and
WHEREAS, the Successor Agency previously issued $65,600,000
aggregate principal amount of the Successor Agency to the La Quinta
Redevelopment Agency, La Quinta Redevelopment Project Area Nos. 1 and 2,
Tax Allocation Refunding Bonds, 2014 Series A (the “Senior Bonds”) pursuant
to an Indenture of Trust dated as of June 1, 2014 (the “Senior Indenture”);
and
WHEREAS, the Successor Agency previously issued $35,055,000
aggregate principal amount of the Successor Agency to the La Quinta
Redevelopment Agency, La Quinta Redevelopment Project Area Nos. 1 and 2,
Subordinate Tax Allocation Refunding Bonds, 2016 Taxable Series A (the
“2016 Bonds”) pursuant to the Original Indenture and a Second Supplemental
Indenture of Trust dated as of October 1, 2016; and
WHEREAS, the Successor Agency has determined that it is cost
effective and efficient to refund and defease in their entirety the 2013 Bonds
and the Senior Bonds (collectively the “Refunded Bonds”); and
WHEREAS, the Successor Agency deems it necessary and proper to
issue taxable tax allocation refunding bonds to refund and defease the
Refunded Bonds; and
WHEREAS, for the corporate purposes of the Successor Agency, the
Successor Agency deems it necessary to issue at this time tax allocation
refunding bonds in a principal amount of not to exceed One Hundred Sixty
Million Dollars ($160,000,000) (the “Bonds”), and to irrevocably set aside a
portion of the proceeds of such Bonds in a separate segregated trust fund
which will be used to refund the outstanding Refunded Bonds, to pay costs in
connection with the issuance of the Bonds, and to make certain other deposits
as required by the Original Indenture (defined herein) as amended and
supplemented by a Third Supplemental Indenture of Trust; and
WHEREAS, in order to provide for the authentication and delivery of
the Bonds, to establish and declare the terms and conditions upon which the
Bonds are to be issued and secured and to secure the payment of the principal
thereof and interest and redemption premium (if any) thereon, the Successor
14
Resolution No. SA 2020 – xxx
RDA Amended Tax Allocation Refunding Bonds Refinance
Adopted: December 15, 2020
Page 3 of 9
124/015610-0182
15505484.4 a12/10/20 -3-
Agency wishes to approve the issuance of the Bonds and authorize the
execution and delivery of the Third Supplemental Indenture of Trust; and
WHEREAS, pursuant to Section 34179 of the Redevelopment
Dissolution Law in Part 1.8 (commencing with Section 34161) and Part 1.85
(commencing with Section 34170) of Division 24 of the Health and Safety
Code of the State of California (the “Dissolution Law”), an oversight board (the
“Oversight Board”) has been established for the Successor Agency and the
Successor Agency will have requested that the Oversight Board approve the
issuance of the Bonds by the Successor Agency, as authorized by Section
34177.5(f) of the Dissolution Law; and
WHEREAS, the Successor Agency hereby certifies that all acts and
proceedings required by law necessary to make the Bonds, when executed by
the Successor Agency, and authenticated and delivered by the Trustee, the
valid, binding and legal special obligations of the Successor Agency, and to
constitute the Original Indenture as amended and supplemented by the Third
Supplemental Indenture of Trust a valid and binding agreement for the uses
and purposes herein set forth in accordance with its terms, have been done
or taken; and
WHEREAS, the Successor Agency wishes at this time to approve all
matter relating to the issuance and sale of the Bonds.
WHEREAS, the City Council on behalf of the Successor Agency has
previously approved a Debt Management Policy which complies with
Government Code Section 8855, and the delivery of the Bonds will be in
compliance with said policy; and
WHEREAS, Section 5852. 1 of the California Government Code, which
became effective on January 1, 2018, enacted pursuant to Senate Bill 450 (
Chapter 625 of the 2017-2018 Session of the California Legislature), requires
that the Successor Agency obtain from an underwriter, municipal advisor or
private lender and disclose, in a meeting open to the public, prior to
authorization of the issuance of the Bonds, good faith estimates of (a) the
true interest cost of the Bonds, ( b) the sum of all fees and charges paid to
third parties with respect to the Bonds, c) the amount of proceeds of the Bonds
expected to be received net of the fees and charges paid to third parties and
any reserves or capitalized interest paid or _ funded with proceeds of the
Bonds, and ( d) the sum total of all debt service payments on the Bonds
calculated to the final maturity of the Bonds plus the fees and charges paid to
third parties not paid with the proceeds of the Bonds; and
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WHEREAS, in compliance with Section 5852. 1 of the California
Government Code, the Successor Agency has prepared, with the assistance of
the Underwriter, the required good faith estimates and such estimates are
included as Exhibit A to this Resolution; and
WHEREAS, this Resolution amends and restates Resolution No. 2020-
001 adopted by the Successor Agency on October 6, 2020 .
NOW, THEREFORE, BE IT RESOLVED, by the Successor Agency to
the La Quinta Redevelopment Agency as follows:
SECTION 1. The Third Supplemental Indenture of Trust, by and between
the Successor Agency and U.S. Bank National Association, dated as of
February 1, 2021, in substantially the form submitted at this meeting and
made a part hereof as though set forth in full herein (the “Third Supplemental
Indenture”), is hereby approved. An Authorized Representative, as defined
below, is hereby authorized and directed to execute and deliver to Third
Supplemental Indenture in the form presented at this meeting with such
changes insertions and omissions as may be requested by Bond Counsel and
approved by the Authorized Representative, said execution being conclusive
evidence of such approval.
SECTION 2. Subject to the provisions of the Third Supplemental
Indenture referred to in Section 1 hereof, the issuance of the Bonds in the
aggregate principal amount of not to exceed One Hundred Sixty Million Dollars
($160,000,000) on the terms and conditions set forth in, and subject to the
limitations specified in, the Third Supplemental Indenture, is hereby
authorized and approved. The Bonds will be dated, will bear interest at the
rates, will mature on the dates, will be issued in the form, will be subject to
redemption, and will be as otherwise provided in the Third Supplemental
Indenture, as the same will be completed as provided in this Resolution. The
proceeds of the sale of the Bonds shall be applied as provided in the Third
Supplemental Indenture.
SECTION 3. The Bond Purchase Contract (the “Bond Purchase Contract”)
between the Successor Agency and Hilltop Securities Inc. (the “Underwriter”),
in substantially the form submitted at this meeting and made a part hereof as
though set forth in full herein, is hereby approved. An Authorized
Representative is hereby authorized and directed to execute the Bond
Purchase Contract in the form presented at this meeting with such changes,
insertions and omissions as may be approved by the Authorized
Representative, said execution being conclusive evidence of such approval;
provided, however, that the Bond Purchase Contract shall be signed only if
the terms of the agreement are such that (i) the existing indebtedness is not
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accelerated, except to the extent necessary to achieve substantially level debt
service, (ii) the principal amount of the Bonds will not exceed the amount
required to finance the refunding of the Refunded Bonds and including
establishing a customary debt service reserve fund and paying related costs
of issuance, (iii) the Underwriter’s Discount not including original issue
discount, shall not exceed three-quarters percent (.750%) of the par value of
the Bonds; and (iv) the Bonds will comply with the provisions of the State
Dissolution Act and the City’s Debt Management Policy. The Preliminary
Official Statement relating to the Bonds (the “Preliminary Official Statement”),
in the form presented and on file with the Secretary, is hereby approved. An
Authorized Representative is hereby authorized and directed, for and in the
name and on behalf of the Successor Agency, to cause the Preliminary Official
Statement in substantially said form, with such additions or changes therein
as the Authorized Representative may approve, to be deemed final for the
purposes of Rule 15c2-12 of the Securities and Exchange Act of 1934 (“Rule
15c2-12”). The Underwriter is hereby authorized to distribute the Preliminary
Official Statement to prospective purchasers of the Bonds in substantially the
form hereby approved, together with such additions thereto and changes
therein as are determined necessary by the Authorized Representative to
make the Preliminary Official Statement final as of its date for purposes of
Rule 15c2-12, including, but not limited to, such additions and changes as are
necessary to make all information set forth therein accurate and not
misleading.
SECTION 4. The preparation and delivery of an Official Statement, and
its use by the Successor Agency and the Underwriter, in connection with the
offering and sale of the Bonds, is hereby authorized and approved. The Official
Statement shall be in substantially the form of the Preliminary Official
Statement with such changes, insertions and omissions as may be requested
by Bond Counsel or the Underwriter and approved by on Authorized
Representative, as defined below, such approval to be conclusively evidenced
by the execution and delivery thereof. The Authorized Representative is
hereby authorized and directed to execute the final Official Statement and any
amendment or supplement thereto, in the name of and on behalf of the
Successor Agency, and thereupon ta cause the final Official Statement and
any such amendment or supplement to be delivered to the Underwriter.
SECTION 5. The form of the Continuing Disclosure Agreement in
substantially the form submitted at this meeting and made a part hereof as
though set forth in full herein, is hereby approved. The Authorized
Representative is hereby authorized and directed to execute and deliver the
Continuing Disclosure Agreement(s) in the form presented at this meeting
with such changes, insertions and omissions as may be requested by Bond
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Counsel and approved by the Authorized Representative, said execution being
conclusive evidence of such approval.
SECTION 6. The form of the Escrow Agreement, by and between the
Successor Agency, and U.S. Bank National Association, in substantially the
form submitted at this meeting and made a part hereof as though set forth in
full herein, is hereby approved. An Authorized Representative, as defined
below, is hereby authorized and directed to execute and deliver the Escrow
Agreement relating to each of the series of Refunded Bonds in the general
form presented at this meeting with such changes, insertions and omissions
as may be requested by Bond Counsel and approved by the Executive Director,
said execution being conclusive evidence of such approval.
SECTION 7. The Chair of the Successor Agency, the Executive Director
of the Successor Agency, the Secretary of the Successor Agency, their written
designee, and any other proper officer of the Successor Agency (“Authorized
Representative”), acting singly, be and each of them hereby is authorized and
directed to execute and deliver any and all documents and instruments,
relating to the Bonds, and each series thereof, and to do and cause to be done
any and all acts and things necessary or proper for carrying out the
transactions contemplated by the Original Indenture, the Third Supplemental
Indenture, the Bond Purchase Contract, the Preliminary Official Statement,
the Continuing Disclosure Agreement, the Escrow Agreement, this Resolution
and any such agreements approved by Bond Counsel.
SECTION 8. U.S. Bank National Association is hereby appointed as
Trustee and Escrow Bank, Rutan & Tucker, LLP is hereby appointed as Bond
Counsel, Nixon Peabody LLP ls hereby appointed as Disclosure Counsel.
Harrell & Company Advisors, LLC is hereby appointed as Municipal Advisor and
the Executive Director of the Successor Agency is authorized to execute
contracts for any or all such services pursuant to proposals on file with the
Executive Director, and Willdan Financial Services is hereby appointed as
Dissemination Agent and the Executive Director of the Successor Agency is
authorized to execute contracts for any or all such services pursuant to
proposals on file with the Executive Director.
SECTION 9. The Successor Agency is hereby authorized to recover its
costs of issuance with respect to the Bonds, including staff time and costs.
SECTION 10. This Resolution shall take effect immediately upon its
adoption.
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PASSED, APPROVED, and ADOPTED at a regular meeting of the La Quinta City
Council held on this 15th day of December 2020, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
____________________
LINDA EVANS, Chairperson
Successor Agency to the La Quinta
Redevelopment Agency
ATTEST:
MONIKA RADEVA, Agency Secretary
Successor Agency to the La Quinta
Redevelopment Agency
(CITY SEAL)
APPROVED AS TO FORM:
WILLIAM IHRKE, Agency Counsel
Successor Agency to the La Quinta
Redevelopment Agency
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EXHIBIT A
SB 450 GOOD FAITH ESTIMATES
The good faith estimates set forth herein are provided with respect to
the Bonds in accordance with California Government Code Section
5852.1. Such good faith estimates have been provided to the Successor
Agency by Hilltop Securities, Inc. (the “Underwriter”).
Principal Amount of the Bonds. The Underwriter has informed the
Successor Agency that, based on the Successor Agency’s financing plan and
current market conditions, its good faith estimate of the aggregate principal
amount of the Bonds to be sold is $157,470,000 (the “Estimated Principal
Amount”).
True Interest Cost of the Bonds. The Underwriter has informed the
Successor Agency that, assuming that the respective Estimated Principal
Amount of the Bonds are sold, and based on market interest rates prevailing
at the time of preparation of such estimate, its good faith estimate of the true
interest cost of the Bonds, which means the rate necessary to discount the
amounts payable on the respective principal and interest payment dates to
the purchase price received for the Bonds, is 2.135%.
Finance Charge of the Bonds. The Underwriter has informed the
Successor Agency that, assuming that the Estimated Principal Amount of the
Bonds are sold, and based on market interest rates prevailing at the time of
preparation of such estimate, its good faith estimate of the finance charge for
the Bonds, which means the sum of all fees and charges paid to third parties
(or costs associated with the Bonds), is $1,364,750.
Amount of Proceeds to be Received. The Underwriter has informed the
Successor Agency that, assuming that the Estimated Principal Amount of the
Bonds are sold, and based on market interest rates prevailing at the time of
preparation of such estimate, its good faith estimate of the amount of
proceeds expected to be received by the Successor Agency for sale of the
Bonds, less the finance charge of the Bonds as estimated above, paid or
funded with proceeds of the Bonds, is $156,100,900.
Total Payment Amount. The Underwriter has informed the Successor
Agency that, assuming that the Estimated Principal Amount of the Bonds are
sold, and based on market interest rates prevailing at the time of preparation
of such estimate, its good faith estimate of the total payment amount, which
means the sum total of all payments the Successor Agency will make to pay
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debt service on the Bonds, plus the finance charge for the Bonds, as described
above, not paid with the respective proceeds of the Bonds, calculated to the
final maturity of the Bonds, is $179,059,600 and the annual ongoing costs to
administer the Bonds not paid with proceeds of the Bonds is $5,000.00.
The foregoing estimates constitute good faith estimates only and are
based on market conditions prevailing at the time of preparation of such
estimates on December 1, 2020. The actual principal amount of the Bonds
issued and sold, the true interest cost thereof, the finance charges thereof,
the amount of proceeds received therefrom and total payment amount with
respect thereto may differ from such good faith estimates due to (a) the actual
date of the sale of the Bonds being different than the date assumed for
purposes of such estimates, (b) the actual principal amount of Bonds sold
being different from the respective Estimated Principal Amount, (c) the actual
amortization of the Bonds being different than the amortization assumed for
purposes of such estimates, (d) the actual market interest rates at the time
of sale of the Bonds being different than those estimated for purposes of such
estimates, (e) other market conditions, or (f) alterations in the Successor
Agency’s financing plan, or a combination of such factors. The actual date of
sale of the Bonds and the actual principal amount of Bonds sold will be
determined by the Successor Agency based on various factors. The actual
interest rates borne by the Bonds will depend on market interest rates at the
time of sale thereof. The actual amortization of the Bonds will also depend,
in part, on market interest rates at the time of sale thereof. Market interest
rates are affected by economic and other factors beyond the control of the
Successor Agency.
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THIRD SUPPLEMENTAL INDENTURE OF TRUST
Dated as of February 1, 2021
by and between the
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
and
U.S. BANK NATIONAL ASSOCIATION
as Trustee
Relating to
$__________
Successor Agency to the
La Quinta Redevelopment Agency
La Quinta Redevelopment Project Areas No. 1 and 2
Tax Allocation Refunding Bonds, 2021 Taxable Series A
ATTACHMENT 1
22
TABLE OF CONTENTS
Page
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ARTICLE XXI DETERMINATIONS; DEFINITIONS .......................................................... 2
Section 21.1 Findings and Determinations ................................................................. 2
Section 21.2 Definitions.............................................................................................. 3
Section 21.3 Rules of Construction ............................................................................ 3
ARTICLE XXII AUTHORIZATION AND TERMS OF 2021 Taxable Series A
BONDS ........................................................................................................... 3
Section 22.1 Authorization of 2021 Taxable Series A Bonds .................................... 3
Section 22.2 Term of 2021 Taxable Series A Bonds .................................................. 4
Section 22.3 Redemption of 2021 Taxable Series A Bonds ....................................... 6
Section 22.4 Form of 2021 Taxable Series A Bonds .................................................. 8
Section 22.5 Execution of 2021 Taxable Series A Bonds .......................................... 8
ARTICLE XXIII DEPOSIT AND APPLICATION OF PROCEEDS OF 2021
Taxable Series A BONDS; PARITY DEBT .................................................. 9
Section 23.1 Issuance of 2021 Taxable Series A Bonds ............................................. 9
Section 23.2 Application of Proceeds of 2021 Taxable Series A Bonds .................... 9
ARTICLE XXIV SUPPLEMENTAL NATURE OF THIRD SUPPLEMENTAL
INDENTURE .................................................................................................. 9
Section 24.1 Modification of Indenture ...................................................................... 9
ARTICLE XXV DEBT SERVICE RESERVE POLICY [?] ................................................... 10
Section 25.1 Provisions Relating to Debt Service Reserve Policy ........................... 10
EXHIBIT A BOND FORM .................................................................................................. A-1
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THIRD SUPPLEMENTAL INDENTURE OF TRUST
THIS THIRD SUPPLEMENTAL INDENTURE OF TRUST (this “Third Supplemental
Indenture”) is dated as of February 1, 2021, by and between the SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic, duly organized
and existing under the laws of the State of California (the “Successor Agency”), and U.S. BANK
NATIONAL ASSOCIATION, a national banking association organized and existing under the
laws of the United States of America, as trustee (the “Trustee”);
WITNESSETH:
WHEREAS, the Successor Agency previously issued $97,190,000 aggregate principal
amount of the Successor Agency to the La Quinta Redevelopment Agency, La Quinta
Redevelopment Project Area Nos. 1 and 2, Subordinate Tax Allocation Refunding Bonds, 2013
Series A (the “2013 Series A Bonds”) pursuant to the Indenture; and
WHEREAS, the Successor Agency previously issued $23,055,000 aggregate principal
amount of the Successor Agency to the La Quinta Redevelopment Agency, La Quinta
Redevelopment Project Area Nos. 1 and 2, Subordinate Tax Allocation Refunding Bonds, 2013
Taxable Series B (the “2013 Series B Bonds”) pursuant to the Indenture; and
WHEREAS, the Successor Agency determined it necessary and proper to issue taxable tax
allocation refunding bonds to refund and defease the 2013 Series A Bonds and 2013 Series B
Bonds (the “2013 Bonds”) on a basis subordinate to the Successor Agency’s previously issued and
outstanding Successor Agency to the La Quinta Redevelopment Agency, La Quinta
Redevelopment Project Area Nos. 1 and 2, Tax Allocation Refunding Bonds, 2014 Series (the
“2014 Bonds”) and on a parity basis with the Successor Agency’s previously issued and
outstanding La Quinta Redevelopment Agency, La Quinta Redevelopment Project Area Nos. 1
and 2, Subordinate Tax Allocation Refunding Bonds, 2016 Taxable Series A (the “2016 Bonds”);
and
WHEREAS, the Successor Agency determined it necessary to issue tax allocation
refunding bonds in one or more series in a total principal amount of $______________, and to
irrevocably set aside a portion of the proceeds of such Bonds in a separate segregated trust fund
which will be used to refund the outstanding 2013 Bonds and the 2014 Bonds (collectively, the
Refunded Bonds”) and to pay costs in connection with the issuance of the Bonds; and
WHEREAS, AB1484 specifically authorizes the issuance of refunding bonds by the
Successor Agency to refund the bonds or other indebtedness of the Successor Agency to provide
savings to the Successor Agency, provided that (A) the total interest cost to maturity on the
Refunded Bonds plus the principal amount of the refunding bonds shall not exceed the total
remaining interest cost to maturity on the Refunded Bonds plus the remaining principal of the
Refunded Bonds, and (B) the principal amount of the Refunded Bonds shall not exceed the amount
required to defease the Refunded Bonds, to establish customary debt service reserves, and to pay
related costs of issuance; and
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WHEREAS, in order to provide for the authentication and delivery of the Bonds, to
establish and declare the terms and conditions upon which the Bonds are to be issued and secured
and to secure the payment of the principal thereof and interest and redemption premium (if any)
thereon, the Successor Agency wishes to approve the issuance of the Bonds and authorize the
execution and delivery of the Third Supplemental Indenture of Trust; and
WHEREAS, pursuant to Section 34179 of the Law, an oversight board (the “Oversight
Board”) has been established for the Successor Agency and the Successor Agency has requested
that the Oversight Board approve the issuance of the Bonds by the Successor Agency, as authorized
by Section 34177.5(f) of the Law; and
WHEREAS, the Successor Agency hereby certifies that all acts and proceedings required
by law necessary to make the Bonds, when executed by the Successor Agency, and authenticated
and delivered by the Trustee, the valid, binding and legal special obligations of the Successor
Agency, and to constitute the Indenture a valid and binding agreement for the uses and purposes
herein set forth in accordance with its terms, have been done or taken;
WHEREAS, the Successor Agency now desires pursuant to this Third Supplemental
Indenture, to issue its La Quinta Redevelopment Project Areas No. 1 and 2, Tax Allocation
Refunding Bonds, 2021 Taxable Series A (the “2021 Taxable Series A Bonds” or “2021 Taxable
Bonds” or the “Bonds”) for the purpose of refunding the Refunded Bonds, to fund a reserve
account and pay costs of issuance; and
WHEREAS, in order to provide for the authentication and delivery of the 2021 Taxable
Series A Bonds, to establish and declare the terms and conditions upon which the 2021 Taxable
Series A Bonds are to be issued and secured and to secure the payment of the principal thereof and
interest and redemption premium (if any) thereon, the Successor Agency and the Trustee have duly
authorized the execution and delivery of this Third Supplemental Indenture; and
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH,
that in order to secure the payment of the principal of and the interest and redemption premium (if
any) on all the 2021 Taxable Series A Bonds issued and Outstanding under the Indenture,
according to their tenor, and to secure the performance and observance of all the covenants and
conditions therein and herein set forth, and to declare the terms and conditions upon and subject
to which the 2021 Taxable Series A Bonds are to be issued and received, and in consideration of
the premises and of the mutual covenants herein contained and of the purchase and acceptance of
the 2021 Taxable Series A Bonds by the Owners thereof, and for other valuable considerations,
the receipt of which is hereby acknowledged, the Successor Agency and the Trustee do hereby
covenant and agree with one another, for the benefit of the respective Owners from time to time
of the 2021 Taxable Series A Bonds, as follows:
ARTICLE XXI
DETERMINATIONS; DEFINITIONS
Section 21.1 Findings and Determinations. The Successor Agency has reviewed all
proceedings heretofore taken and has found, as a result of such review, and hereby finds and
determines that all things, conditions and acts required by law to exist, happen or be performed
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precedent to and in connection with the issuance of the 2021 Taxable Series A Bonds do exist,
have happened and have been performed in due time, form and manner as required by law, and
the Successor Agency is now duly empowered, pursuant to each and every requirement of law, to
issue the 2021 Taxable Series A Bonds in the manner and form provided in this Third
Supplemental Indenture.
Section 21.2 Definitions. Unless otherwise specified herein, the terms of this Third
Supplemental Indenture, of any further Supplemental Indenture, and of any certificate, opinion or
other document herein mentioned, shall have the meanings set forth in that Indenture of Trust,
dated as of December 1, 2013, by and between the Successor Agency and the Trustee as amended
by the First Supplemental Indenture and the Second Supplemental Indenture (collectively the
“Indenture”).
Section 21.3 Rules of Construction. All references herein to “Articles,” “Sections” and
other subdivisions are to the corresponding Articles, Sections or subdivisions of this Third
Supplemental Indenture, and the words “herein”, “hereof,” “hereunder” and other words of similar
import refer to this Third Supplemental Indenture as a whole and not to any particular Article,
Section or subdivision hereof.
ARTICLE XXII
AUTHORIZATION AND TERMS OF 2021 Taxable Series A BONDS
Section 22.1 Authorization of 2021 Taxable Series A Bonds. 2021 Taxable Series A
Bonds in the aggregate principal amount of ______ Million ______ Thousand Dollars
($__________) are hereby authorized to be issued by the Successor Agency under and subject to
the terms of this Third Supplemental Indenture and the Act. The Indenture, as modified by the
First Supplemental Indenture and the Second Supplemental Indenture and the Third Supplemental
Indenture constitutes a continuing agreement with the Trustee for the benefit of the Owners of all
of the 2021 Taxable Series A Bonds issued or to be issued hereunder and then Outstanding to
secure the full and final payment of principal and redemption premiums (if any) and the interest
on all 2021 Taxable Series A Bonds which may from time to time be executed and delivered
hereunder, subject to the covenants, agreements, provisions and conditions herein contained. The
2021 Taxable Series A Bonds shall be designated the “Successor Agency to the La Quinta
Redevelopment Agency, La Quinta Redevelopment Project Areas No. 1 and 2, Tax Allocation
Refunding Bonds, 2021 Taxable Series A.”
(a) The 2021 Taxable Series A Bonds shall be and are special obligations of
the Successor Agency and are secured by an irrevocable pledge of, and are payable as to principal,
interest and premium, if any, subordinate to the 2014 Bonds and on parity with the 2016 Bonds.
The 2021 Taxable Series A Bonds, interest and premium, if any, thereon are not a debt of the City,
the State or any of its political subdivisions (except the Successor Agency), and none of the City,
the State nor any of its political subdivisions (except the Successor Agency) is liable on them. In
no event shall the 2021 Taxable Series A Bonds, interest thereon and premium, if any, be payable
out of any funds or properties other than those of the Successor Agency as set forth in this Third
Supplemental Indenture. The 2021 Taxable Series A Bonds do not constitute an indebtedness
within the meaning of any constitutional or statutory debt limitation or restriction. Neither the
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members of the Successor Agency nor any persons executing the 2021 Taxable Series A Bonds
are liable personally on the 2021 Taxable Series A Bonds by reason of their issuance.
The 2021 Taxable Series A Bonds shall be and are equally secured together with any Parity
Bonds, by an irrevocable pledge of the Pledged Tax Revenues and other funds as hereinafter
provided, without priority for number, maturity, date of sale, date of execution or date of delivery,
except as expressly provided herein.
Nothing in this Third Supplemental Indenture shall preclude: (a) the payment of the 2021
Taxable Series A Bonds from the proceeds of refunding bonds issued pursuant to the Law, or
(b) the payment of the 2021 Taxable Series A Bonds from any legally available funds. Nothing in
this Third Supplemental Indenture shall prevent the Successor Agency from making advances of
its own funds, however derived, to any of the uses and purposes mentioned in this Third
Supplemental Indenture.
The Successor Agency shall have the right to defease the 2021 Taxable Series A Bonds
and be discharged from the lien of this Third Supplemental Indenture in accordance with the
provision of Section 9.3 of the Indenture. If the Successor Agency shall cause to be paid, or shall
have made provision to pay upon maturity or upon redemption prior to maturity, to the
Bondowners the principal of, premium, if any, and interest to become due on the 2021 Taxable
Series A Bonds, through setting aside trust funds or setting apart in a reserve fund or special trust
account created pursuant to this Third Supplemental Indenture or otherwise, or through the
irrevocable segregation for that purpose in some sinking fund or other fund or trust account with
a fiscal agent or otherwise, moneys sufficient therefor, including, but not limited to, interest earned
or to be earned on the investment of such funds, then the lien of this Third Supplemental Indenture,
including, without limitation, the pledge of the Pledged Tax Revenues, and all other rights granted
hereby, shall cease, terminate and become void and be discharged and satisfied, and the principal
of, premium, if any, and interest on the 2021 Taxable Series A Bonds shall no longer be deemed
to be outstanding and unpaid; provided, however, that nothing in this Third Supplemental
Indenture shall require the deposit of more than such amount as may be sufficient, taking into
account both the principal amount of such funds and the interest to become due on the investment
thereof, to implement any refunding of the 2021 Taxable Series A Bonds.
Section 22.2 Term of 2021 Taxable Series A Bonds. The 2021 Taxable Series A Bonds
shall be issued in fully registered form without coupons in denominations of $5,000 or any integral
multiple thereof and the 2021 Taxable Series A Bonds shall mature on September 1, in the years
and in the amounts and shall bear interest at the rate per annum as follows:
Maturity Date
September 1 Principal Amount Interest Rate
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Maturity Date
September 1 Principal Amount Interest Rate
Interest on the 2021 Taxable Series A Bonds shall be payable on each Interest Payment
Date to the person whose name appears on the Registration Books as the Owner thereof as of the
Regular Record Date immediately preceding each such Interest Payment Date, such interest to be
paid by check or draft of the Trustee mailed on the Interest Payment Date by first class mail to
such Owner at the address of such Owner as it appears on the Registration Books; provided,
however, that upon the written request of any Owner of at least $1,000,000 in principal amount of
Series A Bonds received by the Trustee at least fifteen (15) days prior to such Regular Record
Date, payment shall be made by wire transfer in immediately available funds to an account in the
United States designated by such Owner. Principal of and redemption premium (if any) on any
Bond shall be paid upon presentation and surrender thereof, at maturity or redemption, at the Trust
Office of the Trustee. Both the principal of and interest and premium (if any) on the 2021 Taxable
Series A Bonds shall be payable in lawful money of the United States of America Interest shall be
calculated based upon a 360-day year of twelve thirty-day months.
Each 2021 Taxable Series A Bond shall be initially dated as of the Delivery Date and shall
bear interest from the Interest Payment Date next preceding the date of authentication thereof,
unless (a) it is authenticated after a Regular Record Date and on or before the following Interest
Payment Date, in which event it shall bear interest from such Interest Payment Date; or (b) a 2021
Taxable Series A Bond is authenticated on or before __________, 2021, in which event it shall
bear interest from the Delivery Date; provided, however, that if, as of the date of authentication of
any Series A Bond, interest thereon is in default, such Bond shall bear interest from the Interest
Payment Date to which interest has previously been paid or made available for payment thereon.
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Section 22.3 Redemption of 2021 Taxable Series A Bonds.
(a) Optional Redemption. The 2021 Taxable Series A Bonds may be called
before maturity and redeemed at the option of the Successor Agency, in whole or in part, from the
proceeds of refunding bonds or other available funds, on September 1, 20__ or on any date
thereafter prior to maturity. Bonds called for redemption will be redeemed at a redemption price
equal to the principal amount of 2021 Taxable Series A Bonds to be redeemed plus accrued interest
to the redemption date.
(b) Mandatory Sinking Account Redemption. The 2021 Taxable Series A
Bonds maturing on September 1, 20__ and September 1, 20__ will be subject to mandatory
redemption in part, by lot, on September 1, 20__, and September 1, 20__ and on each September
1 until maturity, at a redemption price equal to the principal amount thereof together with accrued
interest thereon to the redemption date, without premium, from minimum sinking fund payments
on hand in the Debt Service Fund in the years and amounts as follows:
Term Bonds Maturing September 1, 20__
Maturity Date Principal Amount
Term Bonds Maturing September 1, 20__
Maturity Date Principal Amount
(c) Purchase In Lieu of Redemption. In lieu of optional or sinking account
redemption of 2021 Taxable Series A Bonds, amounts on deposit in the Redevelopment Obligation
Retirement Fund (to the extent not required to be transferred to the Trustee during the current Bond
Year) may also be used and withdrawn by the Successor Agency at any time for the purchase of
the 2021 Taxable Series A Bonds at public or private sale as and when and at such prices (including
brokerage and other charges and including accrued interest) as the Successor Agency may in its
discretion determine. The par amount of any of the 2021 Taxable Series A Bonds so purchased
by the Successor Agency and surrendered to the Trustee for cancellation in any twelve-month
period ending on August 15, in any year will be credited towards and will reduce the principal
amount of the 2021 Taxable Series A Bonds otherwise required to be redeemed on the following
September 1 pursuant to this Third Supplemental Indenture.
(d) Notice of Redemption. The Trustee on behalf and at the expense of the
Successor Agency shall mail (by first class mail) notice of any redemption to the respective
Owners of any Bonds designated for redemption at their respective addresses appearing on the
Registration Books, at least 30 but not more than 60 days prior to the date fixed for redemption.
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Such notice shall state the date of the notice, the redemption date, the redemption place and the
redemption price and shall designate the CUSIP numbers, if any, the Bond numbers and the
maturity or maturities of the 2021 Taxable Series A Bonds to be redeemed (except in the event of
redemption of all of the 2021 Taxable Series A Bonds of such maturity or maturities in whole),
and shall require that such 2021 Taxable Series A Bonds be then surrendered at the Office of the
Trustee for redemption at the redemption price, giving notice also that further interest on such
2021 Taxable Series A Bonds will not accrue from and after the date fixed for redemption. Neither
the failure to receive any notice so mailed, nor any defect in such notice, shall affect the validity
of the proceedings for the redemption of the 2021 Taxable Series A Bonds or the cessation of
accrual of interest thereon from and after the date fixed for redemption. With respect to any notice
of any optional redemption of Bonds, unless at the time such notice is given the 2021 Taxable
Series A Bonds to be redeemed shall be deemed to have been paid, such notice shall state that such
redemption is conditional upon receipt by the Trustee, on or prior to the date fixed for such
redemption, of moneys that, together with other available amounts held by the Trustee, are
sufficient to pay the redemption price of, and accrued interest on, the 2021 Taxable Series A Bonds
to be redeemed, and that if such moneys shall not have been so received said notice shall be of no
force and effect and the Successor Agency shall not be required to redeem such 2021 Taxable
Series A Bonds. In the event a notice of redemption of Bonds contains such a condition and such
moneys are not so received, the redemption of Bonds as described in the conditional notice of
redemption shall not be made and the Trustee shall, within a reasonable time after the date on
which such redemption was to occur, give notice to the Persons and in the manner in which the
notice of redemption was given, that such moneys were not so received and that there shall be no
redemption of Bonds pursuant to such notice of redemption.
(e) Selection of 2021 Taxable Series A Bonds for Redemption. Whenever
provision is made in this Indenture for the redemption of less than all of the 2021 Taxable Series
A Bonds, the Trustee shall select the 2021 Taxable Series A Bonds to be redeemed from all 2021
Taxable Series A Bonds not previously called for redemption (a) with respect to any optional
redemption of 2021 Taxable Series A Bonds of a series, among maturities of 2021 Taxable Series
A Bonds of such series as directed in a Written Request of the Successor Agency, (b) with respect
to any redemption pursuant to Section 17.03(b) and the corresponding provisions of any
supplemental indenture pursuant to which Additional Bonds are issued, among maturities of all
series of bonds on a pro rata basis as nearly as practicable, and (c) with respect to any other
redemption of Additional Bonds, among maturities as provided in the supplemental indenture
pursuant to which such Additional Bonds are issued, and randomly among bonds of the same series
with the same maturity in any manner which the Trustee in its sole discretion shall deem
appropriate. For purposes of such selection, all bonds shall be deemed to be comprised of separate
$5,000 denominations and such separate denominations shall be treated as separate bonds which
may be separately redeemed.
(f) Partial Redemption of 2021 Taxable Series A Bonds. Upon surrender of
any bonds redeemed in part only, the Successor Agency shall execute and the Trustee shall
authenticate and deliver to the Owner thereof, at the expense of the Successor Agency, a new bond
or bonds of the same series in Authorized Denominations in an aggregate principal amount equal
to the unredeemed portion of the 2021 Taxable Series A Bonds surrendered.
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(g) Effect of Notice of Redemption. Notice having been mailed as aforesaid,
and moneys for the redemption price, and the interest to the applicable date fixed for redemption,
having been set aside with the Trustee, the 2021 Taxable Series A Bonds shall become due and
payable on said date, and, upon presentation and surrender thereof at the Office of the Trustee,
said Bonds shall be paid at the redemption price thereof, together with interest accrued and unpaid
to said date.
If, on said date fixed for redemption, moneys for the redemption price of all the 2021
Taxable Series A Bonds to be redeemed, together with interest to said date, shall be held by the
Trustee so as to be available therefor on such date, and, if notice of redemption thereof shall have
been mailed as aforesaid and not canceled, then, from and after said date, interest on said bonds
shall cease to accrue and become payable. All moneys held by or on behalf of the Trustee for the
redemption of bonds shall be held in trust for the account of the Owners of the 2021 Taxable Series
A Bonds so to be redeemed without liability to such Owners for interest thereon.
All bonds paid at maturity or redeemed prior to maturity pursuant to the provisions hereof
shall be canceled upon surrender thereof and destroyed.
Section 22.4 Form of 2021 Taxable Series A Bonds. The 2021 Taxable Series A Bonds,
the form of Trustee’s certificate of authentication, and the form of assignment to appear thereon,
shall be substantially in the form set forth in Exhibit A attached hereto and by this reference
incorporated herein, with necessary or appropriate variations, omissions and insertions, as
permitted or required by this Third Supplemental Indenture.
Section 22.5 Execution of 2021 Taxable Series A Bonds. The 2021 Taxable Series A
Bonds shall be executed on behalf of the Successor Agency by the signature of its Executive
Director and the signature of its Secretary who are in office on the date of execution and delivery
of this Third Supplemental Indenture or at any time thereafter. Either or both of such signatures
may be made manually or may be affixed by facsimile thereof. If any officer whose signature
appears on any Bond ceases to be such officer before delivery of the 2021 Taxable Series A Bonds
to the purchaser, such signature shall nevertheless be as effective as if the officer had remained in
office until the delivery of the 2021 Taxable Series A Bonds to the purchaser. Any Series A Bond
may be signed and attested on behalf of the Successor Agency by such persons as at the actual date
of the execution of such Series A Bond shall be the proper officers of the Successor Agency
although on the date of such Series A Bond any such person shall not have been such officer of
the Successor Agency.
Only such of the 2021 Taxable Series A Bonds as shall bear thereon a certificate of
authentication in the form set forth in Exhibit A hereto, manually executed and dated by and in the
name of the Trustee by the Trustee, shall be valid or obligatory for any purpose or entitled to the
benefits of this Third Supplemental Indenture, and such certificate of the Trustee shall be
conclusive evidence that such 2021 Taxable Series A Bonds have been duly authenticated and
delivered hereunder and are entitled to the benefits of this Third Supplemental Indenture. In the
event temporary 2021 Taxable Series A Bonds are issued pursuant to the Indenture, the temporary
2021 Taxable Series A Bonds shall bear thereon a certificate of authentication manually executed
and dated by the Trustee, shall be initially registered by the Trustee, and, until so exchanged as
provided under Section 2.9 of the Indenture, the temporary 2021 Taxable Series A Bonds shall be
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entitled to the same benefits pursuant to this Third Supplemental Indenture as definitive 2021
Taxable Series A Bonds authenticated and delivered hereunder.
ARTICLE XXIII
DEPOSIT AND APPLICATION OF PROCEEDS
OF 2021 Taxable Series A BONDS; PARITY DEBT
Section 23.1 Issuance of 2021 Taxable Series A Bonds. Upon the execution and delivery
of this Third Supplemental Indenture and receipt by the Successor Agency of evidence satisfactory
to it of satisfaction of the conditions precedent to issuance of the 2021 Taxable Series A Bonds,
the Successor Agency shall execute and deliver 2021 Taxable Series A Bonds in the aggregate
principal amount of ______ Million _____ Thousand Dollars ($__________) to the Trustee and
the Trustee shall authenticate and deliver the 2021 Taxable Series A Bonds upon the Written
Request of the Successor Agency.
Section 23.2 Application of Proceeds of 2021 Taxable Series A Bonds. (a) On the
Delivery Date the proceeds of sale of the 2021 Taxable Series A Bonds shall be paid to the Trustee
and said amount together with $__________ transferred from the Funds and Accounts held in
connection with the Refunded Bonds and $__________ transferred from the Funds and Accounts
held in connection with the Refunded Bonds shall be applied as follows:
(i) The Trustee shall transfer the amount of $__________ to the Escrow
Bank for deposit in the Escrow Fund pursuant to 2013 Bonds Escrow Agreement;
(ii) The Trustee shall transfer the amount of $____________ to the
Escrow Bank for deposit in the Escrow Fund pursuant to 2014 Bonds Escrow Agreement;
(iii) The Trustee shall deposit the amount of $__________ from Bond
proceeds into the Costs of Issuance Fund; and
(iv) $__________ shall be wired by the Original Purchaser to
____________________________________ (“____”) as payment of the premium upon
the Reserve Policy.
The Trustee may establish a temporary fund or account in its records to facilitate and record
such deposits and transfers.
Moneys deposited in the Escrow Bank and Escrow Funds pursuant to Section 23.3 hereof
shall be held by the Escrow Bank, and used to pay the principal of and interest on the Refunded
Bonds in accordance with the provisions of the relevant Escrow Agreement.
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ARTICLE XXIV
SUPPLEMENTAL NATURE OF THIRD SUPPLEMENTAL INDENTURE
Section 24.1 Modification of Indenture.
This Third Supplemental Indenture modifies and amends the Indenture as it relates to the
2021 Taxable Series A Bonds. All provisions of the Indenture not expressly modified or amended
by the Second Supplemental Indenture shall apply to 2021 Taxable Series A Bonds.
ARTICLE XXV
DEBT SERVICE RESERVE POLICY [?]
Section 25.1 Provisions Relating to Debt Service Reserve Policy.
The provisions of this section shall govern, notwithstanding anything to the contrary set
forth in the Indenture or individually in the appropriate sections:
(a) [Reserved.]
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IN WITNESS WHEREOF, the SUCCESSOR AGENCY TO THE LA QUINTA
REDEVELOPMENT AGENCY, has caused this Third Supplemental Indenture of Trust to be
signed in its name by its Chair and attested by its Secretary, and U.S. BANK NATIONAL
ASSOCIATION, in token of its acceptance of the trusts created hereunder, has caused this Third
Supplemental Indenture to be signed in its corporate name by its officer hereunto duly authorized,
all as of the day and year first above written.
SUCCESSOR AGENCY TO THE LA
QUINTA REDEVELOPMENT AGENCY
By:
Its: Chair
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
Its: Authorized Officer
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EXHIBIT A
(FORM OF BOND)
No. R-__ $__________
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
(COUNTY OF RIVERSIDE)
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
LA QUINTA REDEVELOPMENT PROJECT AREAS NO. 1 AND 2
TAX ALLOCATION REFUNDING BONDS 2021 Taxable Series A
INTEREST RATE MATURITY DATE DATED DATE CUSIP
____% September 1, 20__ _______________ _________
REGISTERED OWNER: CEDE & CO.
PRINCIPAL SUM: THOUSAND DOLLARS
The SUCCESSOR AGENCY TO THE LA QUINTA REDEVELOPMENT AGENCY, a
public body, corporate and politic, duly organized and existing under and by virtue of the laws of
the State of California (the “Successor Agency”), for value received hereby promises to pay to the
Registered Owner stated above, or registered assigns, on the Maturity Date stated above (subject
to any right of prior redemption hereinafter provided for), the Principal Sum stated above, in lawful
money of the United States of America, and to pay interest thereon in like lawful money from the
interest payment date next preceding the date of authentication of this Bond, unless (i) this Bond
is authenticated on an interest payment date, in which event it shall bear interest from such date of
authentication, or (ii) this Bond is authenticated prior to an interest payment date and after the
close of business on the fifteenth calendar day of the month preceding such interest payment date
(a “Record Date”), in which event it shall bear interest from such interest payment date, or (iii) this
Bond is authenticated on or before _________, 2021, in which event it shall bear interest from the
Dated Date stated above; provided, however, that if at the time of authentication of this Bond,
interest is in default on this Bond, this Bond shall bear interest from the interest payment date to
which interest has previously been paid or made available for payment on this Bond, until payment
of such Principal Sum in full, at the rate per annum stated above, payable semiannually on March 1
and September 1 in each year (each an “interest payment date”), commencing ____________,
2021, calculated on the basis of a 360-day year composed of twelve 30-day months. Principal
hereof and premium, if any, upon early redemption hereof are payable upon presentation and
surrender of this Bond at the corporate trust office of U.S. Bank National Association, as trustee
(the “Trustee”). Interest hereon (including the final interest payment upon maturity or earlier
redemption) is payable by check of the Trustee mailed on the interest payment date by first class
mail to the Registered Owner hereof at the Registered Owner’s address as it appears on the
registration books maintained by the Trustee at the close of business on the Record Date next
preceding such interest payment date; provided, however, that upon the written request of any
Registered Owner of at least $1,000,000 in principal amount of Bonds received by the Trustee at
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least fifteen (15) days prior to such Record Date, payment shall be made by wire transfer in
immediately available funds to an account in the United States designated by such Owner.
This Bond is one of a duly authorized issue of Bonds of the Successor Agency designated
as “Successor Agency to the La Quinta Redevelopment Agency, La Quinta Redevelopment Project
Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2021 Taxable Series A” (the “Bonds”), in
an aggregate principal amount of _________ Million _______ Thousand Dollars ($__________),
all of like tenor and date (except for such variation, if any, as may be required to designate varying
series, numbers, maturities, interest rates or redemption and other provisions) and all issued
pursuant to the provisions of the Refunding Bond Act, being Article II (commencing with Section
53580) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code of the State of
California (the “Act”), and pursuant to a resolution of the Successor Agency adopted _______,
2021, and an Indenture of Trust, dated as of December 1, 2013, entered into by and between the
Successor Agency and the Trustee (the “Indenture”), as amended by the First Supplemental
Indenture of Trust dated as of December 1, 2013 and the Second Supplemental Indenture of Trust,
dated as of October 1, 2016, and the Third Supplemental Indenture of Trust, dated as of February
1, 2021, all by and between the same parties, authorizing the issuance of the 2021 Taxable Series
A Bonds. Additional bonds, notes or other obligations may be issued on a parity with the 2021
Taxable Series A Bonds, but only subject to the terms of the Indenture. Reference is hereby made
to the Indenture (copies of which are on file at the office of the Successor Agency) and all
indentures supplemental thereto and to the Law for a description of the terms on which the Bonds
are issued, the provisions with regard to the nature and extent of the Pledged Tax Revenues, as
that term is defined in the Indenture, and the rights thereunder of the registered owners of the
Bonds and the rights, duties and immunities of the Trustee and the rights and obligations of the
Successor Agency thereunder, to all of the provisions of which Indenture the Registered Owner of
this Bond, by acceptance hereof, assents and agrees.
The Bonds are special obligations of the Successor Agency and are payable from, and are
secured by a pledge of and lien on the Pledged Tax Revenues derived by the Successor Agency
from the Project Area (as defined in the Indenture), on a subordinate basis to the Senior Bonds (as
defined in the Indenture).
There has been created and will be maintained by the Successor Agency the
Redevelopment Obligation Retirement Fund (as defined in the Indenture) into which Pledged Tax
Revenues shall be deposited and transferred to the Trustee for deposit into the Debt Service Fund
(as defined in the Indenture) from which the Trustee shall pay the principal of and the interest and
redemption premium, if any, on the Bonds when due. As and to the extent set forth in the
Indenture, all such Pledged Tax Revenues are exclusively and irrevocably pledged to and
constitute a trust fund for, in accordance with the terms hereof and the provisions of the Indenture
and the Law, the security and payment or redemption of, including any premium upon early
redemption, and for the security and payment of interest on, the Bonds, any additional bonds, notes
or other obligations, authorized by the Indenture to be issued on a parity therewith. In addition,
the Bonds (and, if the indenture authorizing any loans, advances or indebtedness issued on a parity
with the Bonds shall so provide, any such loan, advance or indebtedness) shall be additionally
secured at all times by a first and exclusive pledge of and lien upon all of the moneys in the Debt
Service Fund, the Bonds Interest Account, the Bonds Principal Account, the Bonds Reserve
Account and the Bonds Redemption Account (as such terms are defined in the Indenture). Except
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for the Pledged Tax Revenues and such moneys, no funds or properties of the Successor Agency
shall be pledged to, or otherwise liable for, the payment of principal of or interest or redemption
premium, if any, on the Bonds.
The Bonds may be called before maturity and redeemed at the option of the Agency, in
whole or in part from the proceeds of refunding bonds or other available funds, on September 1,
2026 or on any date thereafter prior to maturity. Bonds called for redemption will be redeemed at
the following redemption price equal to the principal amount of the Bonds to be redeemed plus
accrued interest to the redemption date.
The 2021 Taxable Series A Bonds maturing on September 1, 20__ and September 1, 20__
will be subject to mandatory redemption in part, by lot, on September 1, 20__ and September 1,
20__ and on each September 1 until maturity, at a redemption price equal to the principal amount
thereof together with the accrued interest thereon to the redemption date, without premium, from
minimum sinking fund payments on hand in the Debt Service Fund in the years and amounts as
follows:
Term Bonds Maturing September 1, 20__
Maturity Date Principal Amount
Term Bonds Maturing September 1, 20__
Maturity Date Principal Amount
If an Event of Default, as defined in the Indenture, shall occur, the principal of all Bonds
may be declared due and payable upon the conditions, in the manner and with the effect provided
in the Indenture, but such declaration and its consequences may be rescinded and annulled as
further provided in the Indenture.
The Bonds are issuable as fully registered Bonds without coupons in denominations of
$5,000 each and any integral multiple thereof. Subject to the limitations and conditions and upon
payment of the charges, if any, as provided in the Indenture, Bonds may be exchanged for a like
aggregate principal amount of Bonds of other authorized denominations and of the same maturity.
This Bond is transferable by the Registered Owner hereof, in person or by his attorney duly
authorized in writing, at the corporate trust office of the Trustee, but only in the manner and subject
to the limitations provided in the Indenture, and upon surrender and cancellation of this Bond.
Upon registration of such transfer a new fully registered Bond or Bonds, of authorized
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denomination or denominations, for the same aggregate principal amount and of the same maturity
will be issued to the transferee in exchange herefor.
The Successor Agency and the Trustee may treat the Registered Owner hereof as the
absolute owner hereof for all purposes, and the Successor Agency and the Trustee shall not be
affected by any notice to the contrary.
The rights and obligations of the Successor Agency and the registered owners of the Bonds
may be modified or amended at any time in the manner, to the extent and upon the terms provided
in the Indenture, but no such modification or amendment shall extend the maturity of or reduce
the interest rate on any Bond or otherwise alter or impair the obligation of the Successor Agency
to pay the principal, interest or redemption premiums (if any) at the time and place and at the rate
and in the currency provided herein of any Bond without the express written consent of the
registered owner of such Bond, reduce the percentage of Bonds required for the written consent to
any such amendment or modification or, without its written consent thereto, modify any of the
rights or obligations of the Trustee.
This Bond is not a debt of the City of La Quinta, the State of California, or any of its
political subdivisions (except the Successor Agency), and none of said City, said State, nor any of
its political subdivisions (except the Successor Agency) is liable hereon, nor in any event shall this
Bond be payable out of any funds or properties other than those of the Successor Agency as set
forth in the Indenture. The Bonds do not constitute an indebtedness within the meaning of any
constitutional or statutory debt limitation or restriction.
It is hereby certified that all of the things, conditions and acts required to exist, to have
happened or to have been performed precedent to and in the issuance of this Bond do exist, have
happened or have been performed in due and regular time and manner as required by the Law and
the laws of the State of California, and that the amount of this Bond, together with all other
indebtedness of the Successor Agency, does not exceed any limit prescribed by the Law or any
laws of the State of California, and is not in excess of the amount of Bonds permitted to be issued
under the Indenture.
This Bond shall not be entitled to any benefit under the Indenture or become valid or
obligatory for any purpose until the Trustee’s Certificate of Authentication hereon shall have been
manually signed by the Trustee.
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IN WITNESS WHEREOF, the Successor Agency to the La Quinta Redevelopment
Agency has caused this Bond to be executed in its name and on its behalf with the facsimile
signatures of its Executive Director and its Secretary, all as of the Delivery Date.
SUCCESSOR AGENCY TO THE LA QUINTA
REDEVELOPMENT AGENCY
By:
Executive Director
By:
Secretary
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[FORM OF TRUSTEE’S CERTIFICATE OF AUTHENTICATION]
This is one of the Bonds described in the within-mentioned Indenture.
Authentication Date: ______________, 2021
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
Authorized Officer
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(FORM OF ASSIGNMENT)
For value received the undersigned hereby sells, assigns and transfers unto
(Name, Address and Tax Identification or Social Security Number of Assignee)
the within-registered Bond and hereby irrevocably constitute(s) and appoint(s)
_________________ ___________________________________________________attorney, to
transfer the same on the bond register of the Trustee with full power of substitution in the
premises.
Dated:
Note: The signature(s) on this Assignment must
correspond with the name(s) as written on the face
of the within Bond in every particular without
alteration or enlargement or any change whatsoever.
Signature Guaranteed:
Note: Signature(s) must be guaranteed by
an “eligible guarantor institution.”
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30539.00005\33292555.3 1
$_____________
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
La Quinta Redevelopment Project Areas No. 1 and 2
Tax Allocation Refunding Bonds
2021 Taxable Series A
BOND PURCHASE CONTRACT
[To Come]
Successor Agency to the La Quinta Redevelopment Agency
78-495 Calle Tampico
La Quinta, California 92253
Ladies and Gentlemen:
Hilltop Securities Inc. (the “Underwriter”), acting not as fiduciary or agent for you, but on behalf
of itself, hereby offers to enter into this Bond Purchase Contract (the “Purchase Contract”) with the
Successor Agency to the La Quinta Redevelopment Agency (the “Issuer”) for the purchase from the Issuer,
of the Issuer’s La Quinta Redevelopment Project Areas No. 1 and 2 Tax Allocation Refunding Bonds 2021
Taxable Series A (the “Bonds”). This offer is made subject to acceptance thereof by the Issuer prior to 6:00
p.m., California time, on _________, 2020, and upon such acceptance, as evidenced by the signature of the
Executive Director of the Issuer in the space provided herein. This Purchase Contract shall be in full force
and effect in accordance with its terms and shall be binding upon the Issuer and the Underwriter.
The Issuer acknowledges and agrees that: (i) the purchase and sale of the Bonds pursuant to this
Purchase Contract is an arm’s-length commercial transaction between the Issuer and the Underwriter; (ii)
the Underwriter has financial and other interests that differ from those of the Issuer; (iii) in connection with
such transaction, the Underwriter is acting solely as a principal and not as an agent or a fiduciary of the
Issuer; (iv) the Underwriter has not assumed (individually or collectively) a fiduciary responsibility in favor
of the Issuer with respect to: (x) the offering of the Bonds or the process leading thereto (whether or not
any Underwriter, or any affiliate of the Underwriter, has advised or is currently advising the Issuer or
affiliates of the Issuer on other matters); or (y) any other obligation to the Issuer except the obligations
expressly set forth in this Purchase Contract; and (v) the Issuer has consulted with its own legal and financial
advisor to the extent they deemed appropriate in connection with the offering of the Bonds.
1.Purchase and Sale of the Bonds. Upon the terms and conditions and upon the basis of the
representations and agreements herein set forth, the Issuer hereby agrees to sell and the Underwriter hereby
agrees to purchase from the Issuer for offering to the public all (but not less than all) of the $___________
aggregate principal amount of the Successor Agency to the La Quinta Redevelopment Agency, La Quinta
Redevelopment Project Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2021 Taxable Series A, at a
purchase price equal to $_______________ (representing an aggregate principal amount of
$_____________ less an underwriter’s discount of $____________).
The Bonds will mature and bear interest at the interest rates as shown in Appendix A hereto and
will be subject to redemption according to the terms set forth in the Indenture of Trust dated as of December
1, 2013 (the “Original Indenture”), as supplemented by a Second Supplemental Indenture of Trust (the
“Second Supplemental Indenture”) dated as of October 1, 2016, as further supplemented by a Third
Supplemental Indenture of Trust, dated as of ________, 2021 (the “Third Supplemental Indenture”, and,
together with the Original Indenture and the Second Supplemental Indenture, the “Indenture”), each by and
ATTACHMENT 2
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30539.00005\33292555.3 2
between the Agency and U.S. Bank National Association, as trustee (the “Trustee”). The Bonds will be
authorized and issued pursuant to the Indenture approved by Resolution No. SA __________ adopted by
the Issuer on ______________ (the “Resolution”), and by Resolution No. ___________ adopted by the
Oversight Board of the County of Riverside on ___________ (the “Oversight Board Resolution”), and in
accordance with Article 11 (commencing with Section 53580) of Chapter 3 of Part 1 of Division 2 of Title
5 of the Government Code (the “Bond Law”), Parts 1.8 (commencing with Section 34161) and 1.85
(commencing with Section 34170) of Division 24 of the Health and Safety Code of the State, as amended
on June 27, 2012 by Assembly Bill No. 1484 (“AB 1484”), enacted as Chapter 26, Statutes of 2012 and as
further amended on September 22, 2015 by Senate Bill 107 (“SB 107”), enacted as Chapter 325, Statutes
of 2015 (collectively, as amended from time to time, the “Dissolution Act”), and the Constitution and other
applicable laws of the State of California (the “State”).
The Bonds are being issued to refinance all of the Issuer’s outstanding La Quinta Redevelopment
Project Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2013 Series A (the “2013 Series A Bonds”)
and all of the La Quinta Redevelopment Project Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2013
Taxable Series B (the “2013 Series B Bonds” and together with the 2013 Series A Bonds, the “2013 Bonds”)
and the $ La Quinta Redevelopment Project Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2014
Series A (the “2014 Bonds” and together with the 2013 Bonds, the “Refunded Bonds”).
In connection with such refunding, the Issuer, as successor to the La Quinta Redevelopment
Agency (the “Former Agency”), will enter into an Escrow Agreement for the 2013 Bonds, dated as of
____________, 2021 (the “2013 Escrow Agreement”), by and between the Issuer and U.S. Bank National
Association, as Escrow Bank, an Escrow Agreement for the 2014 Bonds, dated as of ____________, 2021
(the “2014 Escrow Agreement” and together with the 2013 Escrow Agreement, the “Escrow Agreements”),
by and between the Issuer and U.S. Bank National Association, as Escrow Bank.
2. Offering. It shall be a condition to the Issuer’s obligations to sell and to deliver the Bonds
to the Underwriter and to the Underwriter’s obligation to purchase, to accept delivery of and to pay for the
Bonds that the entire $_____________ aggregate principal amount of the Bonds shall be issued, sold and
delivered by the Issuer and purchased, accepted and paid for by the Underwriter at the Closing. The
Underwriter agrees to make a bona fide public offering of all of the Bonds at the initial public offering
prices or yields set forth in Exhibit A hereto and on the cover page of the Official Statement, plus interest
accrued thereon from the date of the Bonds. The Underwriter reserves the right to change, subsequent to
the initial public offering, such initial offering prices as it shall deem necessary in connection with the
marketing of the Bonds.
3. Official Statement. The Issuer shall deliver, or cause to be delivered, to the Underwriter
two (2) executed copies of the Official Statement prepared in connection with the Bonds, in such form as
shall be approved by the Issuer and the Underwriter and such additional conformed copies thereof as the
Underwriter may reasonably request. The Issuer deems the Preliminary Official Statement, dated
___________, 2021 (the “Preliminary Official Statement”) to be “final” as of its date for purposes of Rule
15c2-12. By acceptance of this Purchase Contract, the Issuer hereby authorizes the use of copies of the
Official Statement in connection with the public offering and sale of the Bonds, and ratifies and approves
the distribution by the Underwriter of the Preliminary Official Statement.
4. Delivery of the Bonds. At approximately 9:00 a.m., California time, on ____________,
2021, or at such earlier or later time or date, as shall be agreed upon by the Issuer, and the Underwriter
(such time and date herein referred to as the “Closing Date”), the Issuer shall deliver to the Underwriter,
acting on its own behalf at a location to be designated by the Underwriter, in Costa Mesa, California, or
such other place as designated by the Underwriter, the Bonds in definitive form and authenticated by the
Trustee. The Underwriter, acting on its own behalf, shall accept such delivery and pay the purchase price
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of the Bonds as set forth in Section 1 hereof by same day funds (such delivery and payment being herein
referred to as the “Closing”). The form of the Bonds shall be made available to the Underwriter not later
than one business day before the Closing Date for purposes of review and approval. The Bonds shall be
delivered as registered bonds in the name of Cede & Co., Inc.
5. Representations and Agreements of the Issuer. The Issuer represents and agrees that:
(a) The Issuer is a public entity, duly organized and existing, and authorized to
transact business and exercise powers, under and pursuant to the Constitution and laws of
the State, including the Dissolution Act, and has, and at the date of the Closing will have,
full legal right, power and authority (i) to enter into this Purchase Contract, (ii) to issue,
sell and deliver the Bonds to the Underwriter, acting on its own behalf, as provided herein,
(iii) to adopt the Resolution approving the Indenture, and (iv) to carry out and to
consummate the transactions contemplated by this Purchase Contract, the Indenture, the
Escrow Agreements, the Continuing Disclosure Agreement, dated as of ___________,
2021 (the “Disclosure Agreement”), between the Issuer and Willdan Financial Services.,
as Dissemination Agent (the “Dissemination Agent”) with respect to the Bonds, and the
Official Statement;
(b) The Preliminary Official Statement, as of its date, was true, correct and
complete in all material respects and did not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements contained
therein, in light of the circumstances under which they were made, not misleading;
(c) The Official Statement is, and will be, as of the Closing Date, true, correct
and complete in all material respects and does not, and will not, as of the Closing Date,
contain any untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements contained therein, in light of the circumstances under which
they were made, not misleading;
(d) The Issuer to the best of its knowledge has complied, and will at the Closing
Date be in compliance, in all respects with the Bond Law, the Dissolution Act, and any
other applicable laws of the State;
(e) By all necessary official action of the Issuer prior to or concurrently with
the acceptance hereof, the Issuer has duly authorized and approved the Preliminary Official
Statement and the Official Statement, and has duly authorized and approved the execution
and delivery of, and the performance by the Issuer of the obligations on its part contained
in, the Indenture, the Escrow Agreements, the Bonds, the Disclosure Agreement and this
Purchase Contract, and, as of the date hereof, such authorizations and approvals are in full
force and effect and have not been amended, modified or rescinded;
(f) (As of the time of acceptance hereof and as of the time of the Closing, except
as otherwise disclosed in the Official Statement, the Issuer to the best of its knowledge is
not and will not be in any material respect in breach of or in default under any applicable
constitutional provision, law or administrative rule or regulation of the State, of the United
States, or any applicable judgment or decree or any trust agreement, loan agreement, bond,
note, indenture, resolution, ordinance, agreement or other instrument to which the Issuer is
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a party or is otherwise subject, and no event has occurred and is continuing which, with the
passage of time or the giving of notice, or both, would constitute such a default or event of
default under any such instrument; and the adoption of the Resolution and the execution
and delivery of the Bonds, the Indenture, the Escrow Agreements, the Disclosure
Agreement and this Purchase Contract, and compliance with the provisions of each thereof,
will not conflict in any material way with or constitute a material breach of or material
default under any law, administrative regulation, judgment, decree, loan agreement, note,
indenture, resolution, agreement or other instrument to which the Issuer is a party or is
otherwise subject; and, except as described in the Official Statement, the Issuer has not
entered into any contract or arrangement of any kind which might give rise to any lien or
encumbrance on the revenues and amounts pledged pursuant to, or subject to the lien of,
the Indenture;
(g) To the best of its knowledge all approvals, consents and orders of any
governmental authority, board, agency or commission having jurisdiction which would
constitute a condition precedent to adoption of the Resolution approving the Indenture,
execution and delivery by the Issuer of the Indenture, the Escrow Agreements, the
Disclosure Agreement, and this Purchase Contract, and the issuance, sale and delivery of
the Bonds have been obtained or will be obtained prior to the Closing;
(h) The Bonds when issued, authenticated and delivered in accordance with the
Indenture will be validly issued, and will be valid and binding, obligations of the Issuer;
(i) To the best of its knowledge the terms and provisions of the Indenture
comply in all respects with the requirements of the Bond Law, the Dissolution Act, and the
Indenture, the Escrow Agreements, the Disclosure Agreement and this Purchase Contract,
when properly executed and delivered by the respective parties thereto and hereto, will
constitute the valid, legal and binding obligations of the Issuer enforceable in accordance
with their respective terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally
and general rules of equity (regardless of whether such enforceability is considered in a
proceeding at law or in equity);
(j) Except as disclosed in the Official Statement, there is no action, suit,
proceeding, inquiry or investigation, at law or in equity, before or by any court, government
agency, public board or body, pending against the Issuer and notice of which has been
served upon the Issuer, or to the best knowledge of the officer of the Issuer executing this
Purchase Contract threatened against the Issuer, affecting the existence of the Issuer or the
titles of its members or officers, or seeking to prohibit, restrain or enjoin the sale, issuance
or delivery of the Bonds or the payment or collection of any amounts pledged or to be
pledged to pay the principal of, redemption premium, if any, and interest on the Bonds, or
the pledge thereof, or in any way contesting or affecting the validity or enforceability of
the Bonds, the Indenture, the Escrow Agreements, the Disclosure Agreement or this
Purchase Contract or the consummation of the transactions contemplated thereby and
hereby, or contesting in any way the completeness or accuracy of the Preliminary Official
Statement or the Official Statement, or contesting the power or authority of the Issuer to
issue the Bonds, to adopt the Resolution approving the Indenture or to execute and deliver
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the Indenture, the Escrow Agreements, the Disclosure Agreement, or this Purchase
Contract, nor is there any basis therefor, wherein an unfavorable decision, ruling or finding
would materially adversely affect the Issuer’s performance under the Bonds, the Indenture,
the Escrow Agreements, the Disclosure Agreement, or this Purchase Contract, or the
validity or enforceability of the Bonds, the Indenture, the Escrow Agreements, the Disclosure
Agreement, or this Purchase Contract;
(k) Any certificate signed by an authorized officer or official of the Issuer and
delivered to the Underwriter shall be deemed a representation of the Issuer to the
Underwriter as to the statements made therein;
(l) Each of the Bonds shall be secured in the manner and to the extent set forth
in the Indenture under which each such Bond is to be issued;
(m) The Issuer will furnish such information, execute such instruments and take
such other action in cooperation with the Underwriter as the Underwriter may reasonably
request to qualify the Bonds for offer and sale under the “blue sky” or other securities laws
and regulations of such states and other jurisdictions of the United States as the Underwriter
may designate; provided, however, that the Issuer shall not be required to consent to service
of process outside of California;
(n) The Issuer will apply the proceeds of the Bonds in accordance with the
Indenture and all other applicable documents and as described in the Official Statement;
(o) The Issuer has paid to the County Auditor-Controller the amount of
“surplus” demanded, if any, by the County Auditor-Controller pursuant to Health and
Safety Code Section 34183.5;
(p) The Issuer shall provide to the Underwriter, not later than seven (7) business
days after the date of this Purchase Contract, but in any event in sufficient time to
accompany any confirmation sent by the Underwriter to a purchaser of the Bonds, not more
than 200 copies of the Official Statement to satisfy the Underwriter’s obligation under Rule
15c2-12 with respect to the distribution of the Official Statement;
(q) The Oversight Board has duly adopted the Oversight Board Resolution
approving the issuance of the Bonds and no further Oversight Board approval or consent
is required for the issuing of the Bonds or the consummation of the transactions described
in the Preliminary Official Statement;
(r) The Department of Finance of the State (the “Department of Finance”) has
issued a letter, dated _______,2021 approving the issuance of the Bonds. The Issuer knows
of no further Department of Finance approval or consent that is required for the issuance
of the Bonds or the consummation of the transactions describe in the Preliminary Official
Statement. The Issuer has received its Finding of Completion from the Department of
Finance;
(s) In the past five years, except as disclosed in the Official Statement, the City,
the Prior Agency and the Issuer did not fail to comply in any material respect with its
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obligation to file annual reports, but did fail on occasion to timely file notices of rating
changes and certain other matters. The City and the Issuer have established procedures that
they believe will be sufficient to ensure timely future compliance with its continuing
disclosure undertakings; and
(t) The Issuer hereby acknowledges that the Underwriter has provided to the
Issuer prior disclosures regarding its role as underwriter. The Issuer has a municipal advisor
in this transaction that has legal fiduciary duties to the Issuer.
(u) Neither the Prior Agency nor the Issuer has been notified of any listing or
proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whose
arbitrage certifications may not be relied upon.
6. Representations of the Underwriter. The Underwriter represents that it has full right, power,
and authority to enter into this Purchase Contract.
7. Covenants re Official Statement. The Issuer covenants with the Underwriter that so long
as the Underwriter, or dealers, if any, are participating in the distribution of the Bonds which constitute the
whole or a part of their unsold participations, if an event known to the Issuer occurs affecting the Issuer, or
the transactions contemplated by the Indenture and the issuance of the Bonds, which could cause the
Official Statement to contain an untrue statement of a material fact or to omit to state a material fact
necessary in order to make the statements therein, in light of the circumstances under which they were
made, not misleading, the Issuer shall notify the Underwriter and if in the opinion of the Issuer, the
Underwriter or Bond Counsel, such event requires an amendment or supplement to the Official Statement,
the Issuer will amend or supplement the Official Statement in a form and in a manner jointly approved by
the Issuer and the Underwriter, and the Issuer will bear the cost of making and printing such amendment or
supplement to the Official Statement and distributing such amendment or supplement to Owners of the
Bonds. The obligations of the Issuer under this Section 6 shall terminate on the earlier of (a) ninety (90)
days from the “end of the underwriting period,” as defined in Rule 15c2-12, or (b) the time when the Official
Statement is available to any person from a nationally recognized municipal securities information
repository, but in no case less than twenty-five (25) days following the end of the underwriting period.
Unless otherwise notified by the Underwriter in writing not later than thirty (30) days after the Closing
Date, the Issuer may assume that the end of the underwriting period is the Closing Date.
8. Conditions to Obligations of Underwriter. The Underwriter has entered into this Purchase
Contract in reliance upon the representations and agreements of the Issuer contained herein and upon the
accuracy of the statements to be contained in the documents, opinions, and instruments to be delivered at
the Closing. Accordingly, the Underwriter’s obligation under this Purchase Contract to purchase, accept
delivery of, and pay for the Bonds on the Closing Date is subject to the performance by the Issuer of its
obligations hereunder at or prior to the Closing. The following additional conditions precedent relate to the
Closing, in connection with the Underwriter’s obligation to purchase the Bonds:
(a) At the time of the Closing, (i) the representations of the Issuer contained
herein to the best of its knowledge shall be true, complete and correct in all material
respects; and (ii) the Indenture shall be in full force and effect and shall not have been
amended, modified or supplemented, except as may have been agreed to in writing by the
Underwriter;
(b) The Underwriter shall have the right to cancel its obligation to purchase the
Bonds if between the date hereof and the Closing, (i) legislation shall have been enacted
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(or indenture or resolution passed) by or introduced or pending legislation amended in the
Congress of the United States or the State or shall have been reported out of committee or
be pending in committee, or a decision shall have been rendered by a court of the United
States or the State, or a ruling shall have been made or indenture shall have been proposed
or made or any other release or announcement shall have been made by the Treasury
Department of the United States or other federal or State authority, with respect to State
taxation upon interest on obligations of the general character of the Bonds or with respect
to the security pledged to pay debt service on the Bonds, that, in the Underwriter’s
reasonable judgment, materially adversely affects the market for the Bonds, or the market
price generally of obligations of the general character of the Bonds or (ii) there shall exist
any event that, in the Underwriter’s reasonable judgment, either (A) makes untrue or
incorrect in any material respect any statement or information in the Official Statement or
(B) is not reflected in the Official Statement but should be reflected therein in order to
make the statements and information therein not misleading in any material respect, or (iii)
there shall have occurred any outbreak of hostilities or other local, national or international
calamity or crisis, or a default with respect to the debt obligations of, or the institution of
proceedings under the federal bankruptcy laws, the effect of which on the financial markets
of the United States will be such as in the Underwriter’s reasonable judgment, makes it
impracticable for the Underwriter to market the Bonds or enforce contracts for the sale of
the Bonds, or (iv) there shall be in force a general suspension of trading on the New York
Stock Exchange, or minimum or maximum prices for trading shall have been fixed and be
in force, or maximum ranges for prices of securities shall have been required and be in
force on the New York Stock Exchange, whether by virtue of determination by that
Exchange or by order of the Securities and Exchange Commission of the United States or
any other governmental authority having jurisdiction that, in the Underwriter’s reasonable
judgment, makes it impracticable for the Underwriter to market the Bonds or enforce
contracts for the sale of the Bonds, or (v) a general banking moratorium shall have been
declared by federal, New York or State authorities having jurisdiction and be in force that,
in the Underwriter’s reasonable judgment, makes it impracticable for the Underwriter to
market the Bonds or enforce contracts for the sale of the Bonds, or (vi) legislation shall be
enacted or be proposed or actively considered for enactment, or a decision by a court of
the United States shall be rendered, or a ruling, regulation, proposed regulation or statement
by or on behalf of the Securities and Exchange Commission of the United States or other
governmental agency having jurisdiction of the subject matter shall be made, to the effect
that the Bonds or any obligations of the general character of the Bonds are not exempt from
the registration, qualification or other requirements of the Securities Act of 1933, as
amended and as then in effect, or of the Trust Indenture Act of 1939, as amended and as
then in effect, or otherwise are or would be in violation of any provision of the federal
securities laws, or (vii) the New York Stock Exchange or other national securities
exchange, or any governmental authority, shall impose any material restrictions not now
in force with respect to the Bonds or obligations of the general character of the Bonds or
securities generally, or materially increase any such restrictions now in force, including
those relating to the extension of credit by, or the charge to the net capital requirements of,
underwriters, or (viii) there shall have been any materially adverse change in the affairs of
the Issuer which in the Underwriter’s reasonable judgment materially adversely affects the
market for the Bonds, or (ix) general political, economic or market conditions which, in
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the reasonable judgment of the Underwriter, shall make it impracticable for the
Underwriter to market the Bonds or enforce contracts for the sale of the Bonds; and
(c) At or prior to the Closing, the Underwriter and the Issuer shall receive the
following:
(1) The unqualified approving opinion of Rutan & Tucker, LLP, Costa Mesa,
California, bond counsel (the “Bond Counsel”), in form and substance acceptable to the
Underwriter, addressed to the Issuer, dated the date of the Closing, together with a letter
from such counsel, dated the date of the Closing and addressed to the Underwriter, to the
effect that the foregoing opinion may be relied upon by the Underwriter to the same extent
as if such opinion were addressed to it;
(2) A supplemental opinion of Bond Counsel, addressed to the Underwriter,
the Issuer , in form and substance acceptable to each of them, dated the date of Closing, to
the following effect:
(i) The Issuer has duly authorized, executed and delivered the
Indenture, the Escrow Agreements, the Disclosure Agreement and the Purchase
Contract. The Indenture, the Escrow Agreements, the Disclosure Agreement and
the Purchase Contract constitute the legal, valid and binding obligations of the
Issuer, enforceable against the Issuer in accordance with their terms, subject to
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting creditors’ rights, to the application of equitable principles when equitable
remedies are sought and to the exercise of judicial discretion in appropriate cases;
(ii) The Official Statement has been duly authorized, executed and
delivered by the Issuer;
(iii) The statements and information contained or summarized in the
Preliminary Official Statement and Official Statement on the cover page and under
the headings “INTRODUCTORY STATEMENT,” “THE BONDS,” “SECURITY
FOR THE BONDS,” “THE INDENTURE,” “CONCLUDING INFORMATION
– Legal Opinion,” “CONCLUDING INFORMATION – Tax Matters,”
“APPENDIX A – Definitions” and “APPENDIX B – Form of Bond Counsel
Opinion” (but not including any statistical or financial information set forth under
such headings, as to which no opinion need be expressed) insofar as such
statements purport to summarize certain provisions of the Bond Law, the
Dissolution Act, the Redevelopment Law, the Bonds, the Indenture and the Escrow
Agreements, and the opinion of such Bond Counsel concerning certain federal and
state tax matters relating to the Bonds, are accurate in all material respects;
(iv) The Bonds are exempt from registration under the Securities Act
of 1933, as amended;
(v) The Indenture is exempt from qualification under the Trust
Indenture Act of 1939, as amended; and
(vi) The Issuer has obtained all authorizations, approvals, consents or
other orders of the State or any other governmental authority or agency within the
State having jurisdiction over the Issuer for the valid authorization, issuance and
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delivery by the Issuer of the Bonds.
(3) The opinion of counsel to the Issuer, addressed to the Underwriter and the
Issuer, in form and substance acceptable to each of them, dated the date of the Closing, to
the following effect:
(i) The Issuer is a public entity, duly organized and validly existing
under and by virtue of the Constitution and the laws of the State;
(ii) The Indenture, the Disclosure Agreement, the Escrow
Agreements, and the Purchase Contract have been duly approved by the Resolution
of the Issuer adopted at a regular meeting duly called and held in accordance
pursuant to law and with all public notice required by law and at which a quorum
of the members of the Issuer was continuously present, and the Resolution is in
full force and effect and has not been modified, amended or rescinded;
(iii) The Indenture, the Disclosure Agreement, the Escrow
Agreements, and the Purchase Contract have been duly approved by the Oversight
Board Resolution adopted at a special meeting duly called and held in accordance
pursuant to law and with all public notice required by law and at which a quorum
of the members of the Oversight Board was continuously present, and the
Oversight Board Resolution is in full force and effect and has not been modified,
amended or rescinded;
(iv) The information in the Official Statement under the captions
“SUCCESSOR AGENCY” and “THE PROJECT AREAS,” insofar as such
statements purport to summarize information with respect to the Issuer and its
Pass-Through obligations, fairly and accurately summarizes the information
presented therein;
(v) Except as described in the Official Statement, there is no litigation
pending against the Issuer and notice of which has been served on the Issuer, or to
the best of such counsel’s knowledge after due inquiry, threatened against the
Issuer, which: (a) challenges the right or title of any member or officer of the Issuer
to hold his or her respective office or exercise or perform the powers and duties
pertaining thereto; (b) challenges the validity or enforceability of the Bonds, the
Indenture, the Escrow Agreements, the Disclosure Agreement, or the Purchase
Contract; (c) seeks to restrain or enjoin the issuance and sale of the Bonds, the
adoption or effectiveness of the Resolution and Indenture, or the execution and
delivery by the Issuer of, or the performance by the Issuer of its obligations under
the Bonds, the Indenture, the Escrow Agreements, the Disclosure Agreement, or
the Purchase Contract; or (d) if determined adversely to the Issuer or its interests,
would have a material and adverse effect upon the financial condition, assets,
properties or operations of the Issuer; and
(vi) The execution and delivery by the Issuer of, and the performance
by the Issuer of its obligations under, the Bonds, the Indenture, the Escrow
Agreements, the Disclosure Agreement, and the Purchase Contract, do not in any
material respect conflict with, violate or constitute a default under any provision
of any law, court order or decree or any contract, instrument or agreement to which
the Issuer is a party or by which it is bound.
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(4) A certificate dated the date of the Closing, signed by the Executive
Director or appropriate officer of the Issuer, to the effect that to the best of such officer’s
knowledge: (i) the representations and covenants of the Issuer contained herein are true
and correct in all material respects on and as of the date of the Closing with the same effect
as if made on the Closing Date; (ii) the Issuer has complied with all the agreements and
satisfied all of the conditions on its part to be performed or satisfied at or prior to the
Closing; (iii) no event affecting the Issuer has occurred since the date of the Official
Statement which either makes untrue or incorrect in any material respect as of the Closing
Date any statement or information contained in the Official Statement or is not reflected in
the Official Statement but should be reflected therein in order to make the statements and
information therein not misleading in any material respect; and (iv) the Indenture remains
in full force and effect and has not been amended in any respect, except as approved in
writing by the Underwriter, since the date of the Indenture;
(5) A certificate of the Trustee dated the date of the Closing, to the effect that:
(i) the Trustee is organized and existing as a national banking association under and by
virtue of the laws of the United States of America, having full power and being qualified
and duly authorized to perform the duties and obligations of the Trustee and Escrow Bank
under and pursuant to the Indenture and the Escrow Agreements (together, the “Trustee
Documents”); (ii) the Trustee has agreed to perform the duties and obligations of the
Trustee as set forth in the Indenture; (iii) to the best of its knowledge, compliance with the
provisions on the Trustee’s part contained in the Trustee Documents will not conflict with
or constitute a breach of or default under the Articles of Incorporation or Bylaws of the
Trustee or any material law, administrative regulation, judgment, decree, loan agreement,
indenture, resolution, bond, note, agreement or other instrument to which the Trustee is a
party or is otherwise subject, as a result of which the Trustee’s ability to perform its
obligations under the Trustee Documents would be impaired, nor will any such compliance
result in the creation or imposition of any lien, charge or other security interest or
encumbrance of any nature whatsoever upon any of the properties or assets held by the
Trustee pursuant to the Indenture under the terms of any such law, administrative
regulation, judgment, decree, loan agreement, indenture, bond, note, agreement or other
instrument, except as provided by the Trustee Documents; and (iv) to the best of the
knowledge of the Trustee, the Trustee has not been served in any action, suit, proceeding,
inquiry or investigation, at law or in equity, before or by any court, governmental agency,
public board or body, pending nor is any such action, suit, proceeding, inquiry or
investigation threatened against the Trustee, affecting the existence of the Trustee, or the
titles of its officers to their respective offices or seeking to prohibit, restrain or enjoin the
delivery of the Bonds issued under the Indenture or the collection of revenues pledged or
to be pledged to pay the principal of, premium, if any, and interest on the Bonds issued
under the Indenture, or the pledge thereof, or in any way contesting the powers of the
Trustee or its authority to enter into or perform its obligations under the Trustee
Documents, wherein an unfavorable decision, ruling or finding would materially adversely
affect the validity or enforceability of the Indenture or the Disclosure Agreement;
(6) An opinion of counsel to the Trustee dated the Closing Date and addressed
to the Issuer and the Underwriter, in form and substance satisfactory to the Underwriter, to
the effect that: (i) the Trustee has been duly organized and is validly existing and in good
standing as a national banking association under the laws of the United States of America
with full corporate power to undertake the trust of the Indenture; (ii) the Trustee has duly
authorized, executed and delivered the Trustee Documents, and by all proper corporate
action has authorized the acceptance of the duties and obligations of the Trustee under the
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Trustee Documents and to authorize in its capacity as trustee thereunder the authentication
and delivery of the Bonds; (iii) assuming due authorization, execution and delivery by the
City, the Trustee Documents are valid, legal and binding agreements of the Trustee,
enforceable in accordance with their terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of
creditors’ rights in general and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law); (iv) exclusive of federal or
state securities laws and regulations, to the best of such counsel’s knowledge after
reasonable inquiry and investigation, other than routine filings required to be made with
governmental agencies in order to preserve the Trustee’s authority to perform a trust
business (all of which routine filings such counsel believes, after reasonable inquiry and
investigation, to have been made), no consent, approval, authorization or other action by
any governmental or regulatory authority having jurisdiction over the Trustee is or will be
required for the execution and delivery by the Trustee of the Trustee Documents or the
authentication and delivery of the Bonds; (v) to the best of such counsel’s knowledge, the
execution and delivery by the Trustee of the Trustee Documents and the Bonds, and
compliance with the terms thereof will not, in any material respect, conflict with, or result
in a violation or breach of, or constitute a default under, any loan agreement, indenture,
bond, note, resolution or any other agreement or instrument to which the Trustee is a party
or by which it is bound, or any law or any rule, regulation, order or decree of any court or
governmental agency or body having jurisdiction over the Trustee or any of its activities
or properties, or (except with respect to the lien of the Indenture) result in the creation or
imposition of any lien, charge or other security interest or encumbrance of any nature
whatsoever upon any of the property or assets of the Trustee; and (vi) to the best of such
counsel’s knowledge, there is no litigation pending or threatened against or affecting the
Trustee to restrain or enjoin the Trustee’s participation in, or in any way contesting the
powers of the Trustee with respect to the transactions contemplated by the Bonds and the
Trustee Documents;
(7) Two (2) copies of this Purchase Contract duly executed and delivered by
the parties thereto;
(8) Two (2) copies of the Official Statement, executed on behalf of the Issuer
by the Executive Director of the Issuer;
(9) One (1) certified copy of the Indenture, the Escrow Agreements, the
Disclosure Agreement, and all resolutions of the Issuer and the Oversight Board relating
to the issuance of the Bonds (including without limitation the Resolution and the Oversight
Board Resolution);
(10) An opinion, dated the date of the Closing and addressed to the Underwriter
and the Issuer, of Disclosure Counsel, to the effect that based upon its participation in the
preparation of the Official Statement and without having undertaken to determine
independently the accuracy or completeness of the statements in the Official Statement
such Counsel has no reason to believe that, as of the date of Closing, the Official Statement
(except for Appendices A, B, C, E, F, G and H to the Official Statement, any information
about the book-entry system or DTC, the bond insurance policy and the bond insurer,
statements relating to the treatment of the Bonds or the interest or discount related thereto
for tax purposes under the law of any jurisdiction, or financial, statistical and numerical
data included in the Official Statement, as to which no view need be expressed) contains
any untrue statement of a material fact or omits to state any material fact necessary to make
54
30539.00005\33292555.3 12
the statements therein, in light of the circumstances under which they were made, not
misleading;
(11) A defeasance opinion of Bond Counsel, dated the Closing Date, to the
effect that the lien of the Refunded Bonds with respect to the Pledged Tax Revenues has
been discharged;
(12) A Certificate of Willdan Financial Services (“Willdan”), to the following
effect:
(i) Willdan is duly authorized to execute and deliver the Continuing
Disclosure Agreement and to perform as Dissemination Agent thereunder, and
Willdan had duly executed and delivered the Disclosure Agreement;
(ii) Willdan’ execution and delivery of the Disclosure Agreement and
performance as Dissemination Agent thereunder do not and will not conflict in any
way with any law, judgment, agreement or other instrument to which Willdan is a
party or is subject; and
(iii) In the past five years, the City, the Prior Agency and the Issuer did
not fail to comply in any material respect with its obligation to file annual reports,
but did fail on occasion to timely file notices of rating changes and certain other
matters. The City or the Issuer subsequently filed all such notices and has
established procedures that they believe will be sufficient to ensure timely future
compliance with its continuing disclosure undertakings pursuant to Rule 15c2-12.
(13) A Certificate of Harrell & Company Advisors, LLC (“Financial Advisor”) to
the following effect:
(i) in connection with the issuance of the Bonds, Financial Advisor
has provided the Issuer certain projections and estimates (the “Projections”) and a
fiscal consultant report (the “Financial Advisor’s Report”) with respect to the
taxable valuation and Pledged Tax Revenues with respect to the Project Areas. The
Financial Advisor has obtained such information from the County of Riverside and
other sources as the Financial Advisor deemed necessary and relevant to generate
the Financial Advisor’s Report and to express an informed opinion with respect to
the matters discussed in such Financial Advisor’s Report;
(ii) the Financial Advisor has reviewed the Official Statement and, in
particular, information presented in the tables set forth in the Official Statement
under the captions “THE PROJECT AREAS” and “PLEDGED TAX
REVENUES,” and as of the date of the Official Statement and as of the Closing
Date, such information and the Financial Advisor’s Report fairly and accurately
reflect the Projections and, to the best knowledge of the Financial Advisor, do not
contain any untrue or misleading statement of a material fact and do not fail to
state a material fact necessary in order to make the information contained therein,
not misleading;
(iii) Nothing has come to the attention of the Financial Advisor which
would cause the Financial Advisor to believe that the statements and information
contained in the Official Statement that are attributable to the Financial Advisor,
55
30539.00005\33292555.3 13
including but not limited information under the captions “THE PROJECT
AREAS,” “PLEDGED TAX REVENUES” and “APPENDIX F – Financial
Advisor’s Report” as of the date of the Official Statement, are inaccurate in any
material respect; and no event or act known to the Financial Advisor has occurred
since the date of the Official Statement which would make such statements and
information inaccurate or misleading;
(iv) the Financial Advisor affirms its consent to the inclusion of such
Projections in the Official Statement and the reproduction of the Financial
Advisor’s Report in the appendices of the Official Statement;
(14) A reserve account municipal bond insurance policy (the “Reserve
Policy”), issued by _______________________ (the “Insurer”);
(15) An opinion (or opinions) of counsel to the Insurer, dated the date of
Closing, addressed to the Issuer, the Trustee and the Underwriter, regarding the Insurer’s
valid existence, power and authority, the Insurer’s due authorization and issuance of the
Reserve Policy and, the Reserve Policy’s enforceability against the Insurer;
(16) A rating letter from S&P Global Ratings confirming the rating on the
Bonds;
(17) A verification Report prepared by __________ in form satisfactory to
Bond Counsel; and
(18) Such additional legal opinions, certificates, proceedings, instruments and
other documents as the Underwriter, Bond Counsel or Disclosure Counsel may reasonably
request to evidence compliance by the Issuer with this Purchase Contract, legal
requirements, and the performance or satisfaction by the Issuer at or prior to such time of
all agreements then to be performed and all conditions then to be satisfied by the Issuer.
The Issuer will furnish the Underwriter with such conformed copies of such opinions, certificates,
letters and documents as the Underwriter may reasonably request. If the Issuer is unable to satisfy the
conditions to the obligations of the Underwriter contained in this Purchase Contract, or if the obligations of
the Underwriter shall be terminated for any reason permitted by this Purchase Contract, this Purchase
Contract shall terminate and none of the Underwriter, the Issuer shall have any further obligations
hereunder. However, the Underwriter may in its discretion waive one or more of the conditions imposed
by this Purchase Contract for the protection of the Underwriter and proceed with the related Closing.
If this Purchase Contract shall be terminated pursuant to this Section, including but not limited to
paragraphs (b) and (c), or if the purchase provided for herein is not consummated because any condition to
the Underwriter’s obligation hereunder is not satisfied or because of any refusal, inability or failure on the
part of the Issuer to comply with any of the terms or to fulfill any of the conditions of this Purchase Contract,
or if for any reason the Issuer shall be unable to perform all of their respective obligations under this
Purchase Contract, the Issuer shall not be liable to the Underwriter for damages on account of loss of
anticipated profits arising out of the transactions covered by this Purchase Contract.
9. Expenses. The Underwriter shall be under no obligation to pay, and the Issuer shall pay
from its available funds or from the proceeds of the Bonds, certain expenses set forth in this Section,
including but not limited to: (i) all expenses in connection with the preparation, distribution and delivery of
the Preliminary Official Statement, the Official Statement and any amendment or supplement thereto, (ii)
56
30539.00005\33292555.3 14
all expenses in connection with the printing, issuance and delivery of the Bonds, (iii) the fees and
disbursements of Bond Counsel and Disclosure Counsel in connection with the Bonds, (iv) the fees and
disbursements of counsel to the Issuer in connection with the Bonds, (v) the disbursements of the Issuer in
connection with the issuance of the Bonds, (vi) the fees and disbursements of the Trustee, (vii) rating agency
fees, (viii) fees of the Financial Advisor, and (ix) bond insurance and Debt Service Reserve Surety
premiums.
The Underwriter shall pay (i) fees, if any, payable to the California Debt and Investment Advisory
Commission in connection with the issuance of the Bonds; (ii) the cost of preparation of the Blue Sky and
Legal Investment Memoranda and all Blue Sky filing fees in connection with the public offering of the
Bonds; (iii) all advertising expenses in connection with the public offering of the Bonds; and (iv) all other
expenses incurred by it in connection with its public offering and distribution of the Bonds.
The Issuer acknowledges that the Underwriter will pay from the underwriter’s expense allocation
of the underwriting discount certain fees, including the applicable per bond assessment charged by the
California Debt and investment Advisory Commission.
10. Notice. Any notice or other communication to be given to the Issuer under this Purchase
Contract may be given by delivering the same in writing at the address set forth above. Any such notice or
communication to be given to the Underwriter may be given by delivering the same in writing to:
Hilltop Securities Inc.
2533 S. Coast Hwy. 101, Suite 250
Cardiff by the Sea, California 92007
Attention: Ms. Robin M. Thomas
11. Governing Law. This Purchase Contract shall be governed by the laws of the State of
California. This Purchase Contract may be executed by the parties hereto in separate counterparts, each of
which when so executed and delivered shall be an original, but all such counterparts shall together constitute
but one and the same instrument.
[REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOLLOWS]
57
30539.00005\33292555.3
12.Parties in Interest. This Purchase Contract is made solely for the benefit of the signatories
hereto (including the successors or assigns of the Underwriter) and no other person shall acquire or have
any right hereunder or by virtue hereof except as provided in Section 11 hereof. All representations in this
Purchase Contract shall remain operative and in full force and effect, regardless of (a) delivery of and
payment for any of the Bonds and (b) any termination of this Purchase Contract.
Respectfully submitted,
HILLTOP SECURITIES INC.
By:_______________________________________
Title:_____________________________________
Accepted as of the date first stated above:
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
By: _____________________________________
Its: Executive Director
Time of Execution ___________ p.m.
-Signature Page-
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
La Quinta Redevelopment Project Areas No. 1 and 2
Tax Allocation Refunding Bonds
2021 Taxable Series A
58
30539.00005\33292555.3
APPENDIX A
$______________
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
La Quinta Redevelopment Project Areas No. 1 and 2
Tax Allocation Refunding Bonds
2021 Taxable Series A
MATURITY SCHEDULE
Maturity Date
(September) Principal Amount Interest Rate Yield Price
________________________
* Term Bond.
C Priced to the optional redemption date of __________ at par.
The purchase price of the Bonds shall be $__________ which is the principal amount of
$__________, plus a net original issue premium of $__________ and less Underwriter’s discount of
$__________.
59
30539.00005\33292555.3
SCHEDULE A
PRICING WIRE OR EQUIVALENT COMMUNICATION
(Attached)
60
61
PRELIMINARY OFFICIAL STATEMENT DATED ______, 2021 – DRAFT OF DECEMBER 7, 2020
NEW ISSUE – BOOK-ENTRY RATING
S&P: “___”
(See “CONCLUDING INFORMATION - Rating on the Bonds” herein)
In the opinion of Rutan & Tucker, LLP, Irvine, California, Bond Counsel, interest on the Bonds is exempt from State of
California personal income taxes. The Successor Agency does not intend for interest on the Bonds to be excluded from
gross income for federal income tax purposes, but such interest is exempt from State of California personal income taxes.
See “TAX MATTERS” herein.
$157,470,000*
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
LA QUINTA REDEVELOPMENT PROJECT AREAS NO. 1 AND 2
TAX ALLOCATION REFUNDING BONDS
2021 TAXABLE SERIES A
Dated: Date of Delivery Due: September 1 as shown on the inside cover page
Proceeds from the sale of the Successor Agency to the La Quinta Redevelopment Agency (the “Successor Agency”) La
Quinta Redevelopment Project Areas No. 1 and 2 Tax Allocation Refunding Bonds, 2021 Taxable Series A (the “Bonds”)
will be used to refinance certain outstanding obligations of the Successor Agency.
The Bonds will be issued under an Indenture of Trust, dated as of December 1, 2013 (the “Original Indenture”) between
the Successor Agency and U.S. Bank National Association as Trustee (the “Trustee”) as amended and supplemented by (i)
a First Supplemental Indenture of Trust dated as of December 1, 2013, (ii) a Second Supplemental Indenture of Trust,
dated as of October 1, 2016 and (iii) a Third Supplemental Indenture of Trust dated as of ______ 1, 2021 by and between
the Successor Agency and the Trustee (the “Third Supplement” and, with the Original Indenture, the “Indenture”). The
Bonds are special obligations of the Successor Agency and are payable solely from and secured by a pledge of certain tax
increment revenues of the La Quinta Redevelopment Agency (the “Prior Agency”) La Quinta Redevelopment Project
Areas No. 1 and 2 and a pledge of amounts in certain funds and accounts established under the Indenture (see “SECURITY
FOR THE BONDS” and “RISK FACTORS”).
Interest on the Bonds is payable semiannually on each March 1 and September 1, commencing September 1, 2021, until
maturity or earlier redemption (see “THE BONDS - General Provisions” and “- Redemption”) herein).
The Bonds do not constitute a debt or liability of the City of La Quinta, the County of Riverside, the State of
California or of any political subdivision thereof, other than the Successor Agency. The Successor Agency shall
only be obligated to pay the principal of the Bonds, or the interest thereon, from the funds described herein, and neither the faith and credit nor the taxing power of the City of La Quinta, the County of Riverside, the State of California or any of its political subdivisions is pledged to the payment of the principal of or the interest on the
Bonds. The Successor Agency has no taxing power.
The cover page contains certain information for quick reference only. It is not a summary of the issues. Potential investors
must read the entire Official Statement to obtain information essential to the making of an informed investment decision.
See “RISK FACTORS” herein for a discussion of special risk factors that should be considered in evaluating the investment
quality of the Bonds.
The Bonds are being offered when, as and if issued, subject to the approval as to their legality by Rutan & Tucker, LLP,
Irvine, California. Certain legal matters will also be passed on for the Successor Agency by Nixon Peabody LLP, Los
Angeles, California, as Disclosure Counsel, and by the City Attorney, as Successor Agency Counsel. Certain legal matters
will be passed on for the Underwriter by its counsel, of Best Best & Krieger LLP, Riverside, California. It is anticipated
that the Bonds will be available for delivery through the facilities of The Depository Trust Company on or about ________,
2021 (see “APPENDIX G - THE BOOK-ENTRY SYSTEM” herein).
The date of the Official Statement is _________, 2021.
__________________________
* Preliminary, subject to change.This Preliminary Official Statement and the information contained herein are subject to completion or amendment. Under no circumstances shPreliminary Official Statement constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any jurisin which such offer, solicitation or sale would be unlawful under the securities laws of such jurisdiction. ATTACHMENT 3
62
$157,470,000*
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
LA QUINTA REDEVELOPMENT PROJECT AREAS NO. 1 AND 2
TAX ALLOCATION REFUNDING BONDS
2021 TAXABLE SERIES A
MATURITY SCHEDULE
Maturity Date Principal Interest CUSIP®†
September 1 Amount Rate Yield Price (85473T)
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
__________________________
* Preliminary, subject to change.
† CUSIP® is a registered trademark of the American Bankers Association. CUSIP data herein is provided by CUSIP
Global Services, managed by S&P Capital IQ on behalf of the American Bankers Association. CUSIP numbers
have been assigned by an independent company not affiliated with the Successor Agency, the Municipal Advisor or
the Underwriter and are included solely for the convenience of the holders of the Bonds. None of the Successor
Agency, the Municipal Advisor or the Underwriter is responsible for the selection or use of these CUSIP numbers,
and no representation is made as to their correctness on the Bonds or as indicated above. The CUSIP number for a
specific maturity is subject to being changed after the issuance of the Bonds as a result of various subsequent actions
including, but not limited to, a refunding in whole or in part of such maturity or as a result of the procurement of
secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a portion
of certain maturities of the Bonds.
63
GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT
For purposes of compliance with Rule 15c2-12 of the United States Securities and Exchange Commission, as amended (“Rule
15c2-12”), this Preliminary Official Statement constitutes an “official statement” of the Successor Agency with respect to the
Bonds that has been deemed “final” by the Successor Agency as of its date except for the omission of no more than the information
permitted by Rule 15c2-12.
No Offering May be Made Except by This Official Statement. No dealer, broker, salesperson or other person has been authorized
to give any information or to make any representations with respect to the Bonds other than as contained in this Official Statement,
and if given or made, such other information or representation must not be relied upon as having been authorized.
No Unlawful Offers or Solicitations. This Official Statement does not constitute an offer to sell or the solicitation of an offer to
buy in any state in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is
not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation.
Effective Date. This Official Statement speaks only as of its date and the information and expressions of opinion contained in
this Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale of the
Bonds will, under any circumstances, create any implication that there has been no change in the affairs of the Successor Agency
or the Project Areas since the date of this Official Statement.
Use of This Official Statement. This Official Statement is submitted in connection with the sale of the Bonds referred to in this
Official Statement and may not be reproduced or used, in whole or in part, for any other purpose. This Official Statement is not
a contract with the purchasers of the Bonds.
Preparation of This Official Statement. The information contained in this Official Statement has been obtained from sources
that are believed to be reliable, but this information is not guaranteed as to accuracy or completeness. The information and
expressions of opinions herein are subject to change without notice and neither the delivery of this Official Statement nor any
sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the
Successor Agency since the date hereof. This Official Statement is submitted in connection with the sale of the Bonds referred
to herein and may not be reproduced or used, in whole or in part, for any other purpose, unless authorized in writing by the
Successor Agency. All summaries of the Bonds, the Indenture and other documents, are made subject to the provisions of such
documents and do not purport to be complete statements of any or all of such provisions. Reference is hereby made to such
documents on file with the Successor Agency for further information. See “INTRODUCTION - Summary Not Definitive.”
The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the
information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal
securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy
or completeness of such information.
Stabilization of and Changes to Offering Prices. The Underwriter may overallot or take other steps that stabilize or maintain
the market price of the Bonds at levels above that which might otherwise prevail in the open market. If commenced, the
Underwriter may discontinue such market stabilization at any time. The Underwriter may offer and sell the Bonds to certain
dealers, dealer banks and banks acting as agent at prices lower than the public offering prices stated on the inside cover page of
this Official Statement, and those public offering prices may be changed from time to time by the Underwriter.
Bonds are Exempt From Securities Laws Registration. The Bonds have not been registered under the Securities Act of 1933,
as amended, or the Securities Exchange Act of 1934, as amended, in reliance upon exemptions for the issuance and sale of
municipal securities provided under Section 3(a)(2) of the Securities Act of 1933 and Section 3(a)(12) of the Securities Exchange
Act of 1934.
Estimates and Projections. Certain statements included or incorporated by reference in this Official Statement constitute
“forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section
21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of
1933, as amended. Such statements are generally identifiable by the terminology used such as “plan,” “expect,” “estimate,”
“budget” or other similar words.
THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD-
LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS
WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY
DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY
SUCH FORWARD-LOOKING STATEMENTS. THE SUCCESSOR AGENCY DOES NOT PLAN TO ISSUE ANY UPDATES
OR REVISIONS TO THOSE FORWARD-LOOKING STATEMENTS IF OR WHEN ITS EXPECTATIONS, OR EVENTS,
CONDITIONS OR CIRCUMSTANCES ON WHICH SUCH STATEMENTS ARE BASED OCCUR.
Website. The City of La Quinta maintains an Internet website, but the information on the website is not incorporated in this
Official Statement.
64
SUCCESSOR AGENCY TO THE LA QUINTA REDEVELOPMENT AGENCY
LA QUINTA, CALIFORNIA
BOARD OF DIRECTORS
Linda Evans, Chair
John Peña, Vice-Chair
Kathleen Fitzpatrick, Member
Robert Radi, Member
Steve Sanchez, Member
______________________________________________
AGENCY/CITY STAFF
Jon McMillen, Executive Director/City Manager
Monika Radeva, Agency Secretary/City Clerk
Karla Romero, Finance Director
William Ihrke, Agency Counsel/City Attorney
__________________________________________
PROFESSIONAL SERVICES
Bond Counsel/Agency Counsel
Rutan & Tucker LLP
Irvine, California
Disclosure Counsel
Nixon Peabody LLP
Los Angeles, California
Trustee and Escrow Bank
U.S. Bank National Association
Los Angeles, California
Municipal Advisor
Harrell & Company Advisors, LLC
Orange, California
Underwriter
Hilltop Securities, Inc. Cardiff by the Sea, California
65
TABLE OF CONTENTS
INTRODUCTION ...................................................... 1
The Successor Agency and the Prior Agency ............ 1
The City ..................................................................... 2
Authority and Purpose ............................................... 2
Tax Allocation Financing Under the Dissolution
Act .......................................................................... 2
The Project Areas ....................................................... 3
Bonded Debt of the Successor Agency ...................... 3
Security for the Bonds ............................................... 3
Reserve Account Surety Bond ................................... 4
Legal Matters ............................................................. 4
Offering of the Bonds ................................................ 5
Summary Not Definitive ............................................ 5
THE BONDS ............................................................... 6
General Provisions ..................................................... 6
Redemption ................................................................ 7
Scheduled Debt Service on the Bonds ....................... 8
THE FINANCING PLAN .......................................... 9
The Refunding Plan ................................................... 9
Estimated Sources and Uses of Funds ..................... 10
THE DISSOLUTION ACT ...................................... 10
SECURITY FOR THE BONDS .............................. 11
Pledged Tax Revenues ............................................. 11
Redevelopment Property Tax Trust Fund ................ 12
Recognized Obligation Payment Schedules ............ 14
Pledge of Pledged Tax Revenues ............................. 15
No Additional Debt Other Than Refunding Bonds .. 16
THE SUCCESSOR AGENCY ................................. 18
Successor Agency Powers ....................................... 18
Redevelopment Plans ............................................... 18
SB 107 Effects on Plan Limits ................................. 19
THE PROJECT AREAS .......................................... 20
Description of the Project Areas .............................. 20
Assessed Valuations and Pledged Tax Revenues .... 20
Major Taxpayers ...................................................... 23
Assessment Appeals ................................................. 24
Tax Collections ........................................................ 25
FINANCIAL INFORMATION ............................... 25
Successor Agency Accounting Records and
Financial Statements ............................................. 25
Property Taxation in California ................................ 26
Tax Sharing Agreements and Tax Sharing Statutes . 29
Outstanding Indebtedness and Enforceable
Obligations ........................................................... 29
Projected Pledged Tax Revenues ............................. 30
Debt Service Coverage ............................................ 31
RISK FACTORS ...................................................... 32
Factors Which May Affect Pledged Tax Revenues .. 32
Real Estate and General Economic Risks ................ 35
COVID-19 ............................................................... 36
Last and Final Recognized Obligation Payment
Schedule ............................................................... 37
Cybersecurity ........................................................... 37
Secondary Market .................................................... 37
TAX MATTERS ....................................................... 38
Information Reporting and Backup Withholding .... 38
LEGAL MATTERS .................................................. 39
Enforceability of Remedies ..................................... 39
Approval of Legal Proceedings ............................... 39
No Litigation ........................................................... 39
CONCLUDING INFORMATION .......................... 39
Rating on the Bonds ................................................ 39
The Municipal Advisor ............................................ 40
Continuing Disclosure ............................................. 40
Underwriting ........................................................... 40
References ............................................................... 41
Execution ................................................................. 41
APPENDIX A - SUMMARY OF CERTAIN
PROVISIONS OF THE INDENTURE
APPENDIX B - MUNICIPAL ADVISOR’S PROJECTED TAX REVENUES REPORT
APPENDIX C - CITY OF LA QUINTA
INFORMATION STATEMENT
APPENDIX D - CITY AUDITED FINANCIAL
STATEMENTS FOR THE FISCAL YEAR ENDED
JUNE 30, 2020
APPENDIX E - FORM OF CONTINUING
DISCLOSURE AGREEMENT
APPENDIX F - PROPOSED FORM OF BOND
COUNSEL OPINION
APPENDIX G - THE BOOK-ENTRY SYSTEM
66
1
OFFICIAL STATEMENT
$157,470,000*
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
LA QUINTA REDEVELOPMENT PROJECT AREAS NO. 1 AND 2
TAX ALLOCATION REFUNDING BONDS
2021 TAXABLE SERIES A
This Official Statement, which includes the cover page, inside cover page and appendices (the “Official
Statement”), is provided to furnish certain information concerning the sale of the Successor Agency to the
La Quinta Redevelopment Agency La Quinta Redevelopment Project Areas No. 1 and 2 Tax Allocation
Refunding Bonds, 2021 Taxable Series A (the “Bonds”).
INTRODUCTION
This Introduction contains only a brief description of this issue and does not purport to be complete. The
Introduction is subject in all respects to more complete information in the entire Official Statement and the
offering of the Bonds to potential investors is made only by means of the entire Official Statement and the
documents summarized herein. Potential investors must read the entire Official Statement to obtain
information essential to the making of an informed investment decision (see “RISK FACTORS” herein). For
definitions of certain capitalized terms used herein and not otherwise defined, and the terms relating to the
Bonds, see the summary included in “APPENDIX A - SUMMARY OF CERTAIN PROVISIONS OF THE
INDENTURE” herein.
The Successor Agency and the Prior Agency
The La Quinta Redevelopment Agency (the “Prior Agency”) was established in 1983 by the City Council
(the “City Council”) of the City of La Quinta (the “City”) pursuant to the Community Redevelopment Law
(the “Redevelopment Law”), constituting Part 1 of Division 24 (commencing with Section 33000) of the
Health and Safety Code of the State of California (the “State”). On June 29, 2011, Assembly Bill No. 26
(“AB X1 26”) was enacted as Chapter 5, Statutes of 2011. As a result of AB X1 26 and the decision of the
California Supreme Court in California Redevelopment Association, et al. v. Matosantos, et al., 53 Cal. 4th
231 (Cal. 2011), as of February 1, 2012, all redevelopment agencies in the State were dissolved, including
the Prior Agency, and successor agencies were designated as successor entities to the former redevelopment
agencies to expeditiously wind down the affairs of the former redevelopment agencies.
The primary provisions enacted by AB X1 26 relating to the dissolution and wind down of former
redevelopment agency affairs are Parts 1.8 (commencing with Section 34161) and 1.85 (commencing with
Section 34170) of Division 24 of the Health and Safety Code of the State, as amended on June 27, 2012 by
Assembly Bill No. 1484 (“AB 1484”), enacted as Chapter 26, Statutes of 2012, and as further amended on
September 22, 2015 by Senate Bill No. 107 (“SB 107”) enacted as Chapter 325, Statutes of 2015. The
provisions of Part 1.85 as amended by AB 1484 and SB 107 are referred to in this Official Statement as the
“Dissolution Act.” The Redevelopment Law, as amended by the Dissolution Act, is sometimes referred to
herein as the “Law.”
__________________________
* Preliminary, subject to change.
67
2
Pursuant to Section 34173 of the Dissolution Act, the City Council serves as the governing board of the
successor agency to the Prior Agency. Since the February 1, 2012 dissolution of the Prior Agency, the City
has served as the Successor Agency to the La Quinta Redevelopment Agency (the “Successor Agency”).
The City Manager acts as the Successor Agency’s Executive Director (see “THE SUCCESSOR AGENCY”
herein).
Section 34173(g) of the Dissolution Act expressly affirms that the Successor Agency is a separate public
entity from the City, that the two entities shall not merge, and that the liabilities of the Prior Agency will
not be transferred to the City nor will the assets of the Prior Agency become assets of the City (see “THE
SUCCESSOR AGENCY” herein).
The City
The City was incorporated in 1982 and became a charter city in 1996. It encompasses over 35 square miles
located is located in the area of Riverside County (the “County”) known as the “Coachella Valley,”
approximately 20 miles east of Palm Springs (see “APPENDIX C - CITY OF LA QUINTA INFORMATION
STATEMENT” herein).
Authority and Purpose
The Bonds are being issued pursuant to the Constitution and laws of the State, including Article 11
(commencing with Section 53580) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code
of the State (the “Refunding Law”), the Law and an Indenture of Trust, dated as of December 1, 2013 (the
“Original Indenture”) between the Successor Agency and U.S. Bank National Association as Trustee (the
“Trustee”) as amended and supplemented by (i) a First Supplemental Indenture of Trust dated as of
December 1, 2013, (ii) a Second Supplemental Indenture of Trust, dated as of October 1, 2016 and (iii) a
Third Supplemental Indenture of Trust dated as of _____ 1, 2021 by and between the Successor Agency
and the Trustee (the “Third Supplement” and, with the Original Indenture, the “Indenture”).
The Bonds are being issued to refinance the Successor Agency’s outstanding La Quinta Redevelopment
Project Areas No. 1 and 2, Subordinate Tax Allocation Refunding Bonds, 2013 Series A (the “2013 Series
A Bonds”) and La Quinta Redevelopment Project Areas No. 1 and 2, Subordinate Tax Allocation Refunding
Bonds, 2013 Taxable Series B (the “2013 Series B Bonds” and together with the 2013 Series A Bonds, the
“2013 Bonds”) and the Successor Agency’s outstanding La Quinta Redevelopment Project Areas No. 1 and
2, Tax Allocation Refunding Bonds, 2014 Series A (the “2014 Bonds” and together with the 2013 Bonds,
the “Refunded Bonds”). See “THE FINANCING PLAN” herein.
Tax Allocation Financing Under the Dissolution Act
Prior to the enactment of AB X1 26, the Redevelopment Law authorized the financing of redevelopment
projects through the use of tax increment revenues. This method provided that the taxable valuation of the
property within a redevelopment project area on the property tax roll last equalized prior to the effective
date of the ordinance which adopted the redevelopment plan became the base year valuation. Assuming
the taxable valuation never dropped below the base year level, the Taxing Agencies, as defined herein,
thereafter received that portion of the taxes produced by applying then current tax rates to the base year
valuation, and the redevelopment agency was allocated the remaining portion produced by applying then
current tax rates to the increase in valuation over the base year. Such incremental tax revenues (referred to
as “Tax Increment Revenues” herein) allocated to a redevelopment agency were authorized to be pledged
to the payment of agency obligations.
Under the Dissolution Act, moneys will be deposited from time to time in a Redevelopment Property Tax
Trust Fund (the “Redevelopment Property Tax Trust Fund” or “RPTTF”) held by a county auditor-controller
with respect to a successor agency, which are equivalent to the Tax Increment Revenues that were formerly
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allocated under the Redevelopment Law to the redevelopment agency and formerly authorized under the
Redevelopment Law to be used for the financing of redevelopment projects. See “THE DISSOLUTION
ACT” herein for additional information.
The Dissolution Act authorizes refunding bonds, including the Bonds, to be secured by a pledge of moneys
deposited from time to time in the Redevelopment Property Tax Trust Fund. Pledged Tax Revenues, as
defined herein, pledged to pay the Bonds consist of a portion of the amounts deposited from time to time
in the Redevelopment Property Tax Trust Fund established pursuant to and as provided in the Dissolution
Act (see “Security for the Bonds” below).
The Dissolution Act provides that any bonds authorized thereunder to be issued by the Successor Agency
will be considered indebtedness incurred by the Prior Agency, with the same legal effect as if the bonds had
been issued prior to the effective date of AB X1 26, in full conformity with the applicable provision of the
Redevelopment Law that existed prior to that date, and will be included in the Successor Agency’s
Recognized Obligation Payment Schedules (see “APPENDIX A - SUMMARY OF CERTAIN PROVISIONS OF
THE INDENTURE - Definitions” and “SECURITY FOR THE BONDS - Recognized Obligation Payment
Schedules”).
The Project Areas
The Redevelopment Plan for the La Quinta Redevelopment Project Area No. 1 was approved by Ordinance
No. 43 adopted by the City Council on November 29, 1983, and has been amended several times. The La
Quinta Redevelopment Project Area No. 1 (“Project Area No. 1”) encompasses 17.9 square miles (11,475
acres) of commercial, public and residential properties.
The Redevelopment Plan for the La Quinta Redevelopment Project Area No. 2 was approved by Ordinance
No. 139 adopted by the City Council on May 16, 1989, and has also been amended several times. The La
Quinta Redevelopment Project Area No. 2 (“Project Area No. 2”) encompasses 4.9 square miles (3,130
acres) of commercial, public and residential properties.
Project Area No. 1 and Project Area No. 2 are referred to herein individually as a “Project Area” and
collectively as the “Project Areas,” and the Redevelopment Plans for Project Area No. 1 and Project Area
No. 2 are re referred to herein individually as a “Redevelopment Plan” and collectively as the
“Redevelopment Plans.”
See “THE PROJECT AREAS” herein for additional information on the Project Areas and “THE SUCCESSOR
AGENCY” herein for additional information on the Redevelopment Plans.
Bonded Debt of the Successor Agency
The Successor Agency previously issued $35,035,000 La Quinta Redevelopment Project Areas No. 1 and
2, Subordinate Tax Allocation Refunding Bonds, 2016 Taxable Series A (the “2016 Parity Bonds”), of which
$29,380,000 are currently outstanding. The Bonds are being issued on a parity with the 2016 Parity Bonds.
Security for the Bonds
For the security of the Bonds, the Successor Agency grants a pledge of and lien on all of the Pledged Tax
Revenues. “Pledged Tax Revenues” are defined under the Indenture as the portion of the monies deposited
from time to time in the Redevelopment Property Tax Trust Fund as provided by Section 34183(a)(2) of the
Dissolution Act, less the amount required to pay debt service on the Senior Bonds. Upon the issuance of
the Bonds, there will be no Senior Bonds Outstanding. Under the Dissolution Act, monies deposited in the
Redevelopment Property Tax Trust Fund (“RPTTF”) as used in the definition of Pledged Tax Revenues,
means taxes that were eligible for allocation to the Prior Agency with respect to the Project Areas and are
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allocated to the Successor Agency pursuant to Article 6 of Chapter 6 (commencing with Section 33670) of
the Law and Section 16 of Article XVI of the Constitution of the State, or pursuant to other applicable State
laws. The deposit in the Redevelopment Property Tax Trust Fund excludes amounts first paid pursuant to
Section 34183(a)(1) of the Dissolution Act, under Contractual Tax Sharing Agreements and as Statutory
Tax Sharing (as defined herein), except as described below. By definition, under the Dissolution Act,
Pledged Tax Revenues are net of the County’s administrative costs allowed under Section 34182 of the
Dissolution Act and Section 95.3 of the Revenue and Taxation Code. See “FINANCIAL INFORMATION -
Property Taxation in California” and “- Tax Sharing Agreements and Tax Sharing Statutes” herein.
Certain payments due under Contractual Tax Sharing Agreements are subordinate to bonded indebtedness
of the Prior Agency (“Subordinated Pass-Through Amounts”). The Successor Agency believes that
pursuant to the Dissolution Act that the Subordinated Pass-Through Amounts in Project Area No. 1, in
certain circumstances, would be available pursuant to Health & Safety Code Section 34183(b) to pay debt
service on the Bonds and the 2016 Parity Bonds. The Municipal Advisor has included the Subordinated
Pass-Through Amounts in Project Area No. 1 Tax Revenues in calculating Pledged Tax Revenues available
to pay debt service shown in the table entitled “PROJECTED PLEDGED TAX REVENUES” and the table
under the heading “Debt Service Coverage” herein.
The Successor Agency may issue refunding bonds payable from Pledged Tax Revenues on a parity with the
Bonds and the 2016 Parity Bonds (“Parity Debt”) to refinance the Bonds or the 2016 Parity Bonds. See
“SECURITY FOR THE BONDS - No Additional Debt Other Than Refunding Bonds” herein.
Taxes levied on the property within the Project Areas on that portion of the taxable valuation over and above
the taxable valuation of the base year property tax roll of each Project Area, will be deposited in the RPTTF
for transfer by the County Auditor-Controller to the Successor Agency’s Redevelopment Obligation
Retirement Fund, as defined herein, on January 2 and June 1 of each year to the extent required for
payments listed in the Successor Agency’s Recognized Obligation Payment Schedule in accordance with
the requirements of the Dissolution Act. Moneys transferred by the County Auditor-Controller to the
Successor Agency will be deposited into the Successor Agency’s Redevelopment Obligation Retirement
Fund and amounts required for payment of debt service on the Bonds will be transferred by the Successor
Agency to the Trustee for deposit in the Debt Service Fund established under the Indenture. See
“SECURITY FOR THE BONDS - Recognized Obligation Payment Schedules” herein.
The Bonds do not constitute a debt or liability of the City, the County, the State or of any political subdivision thereof, other than the Successor Agency. The Successor Agency shall only be obligated to pay the principal of the Bonds, or the interest thereon, from the funds described herein, and neither the faith and credit nor the taxing power of the City, the County, the State or any of its political subdivisions is pledged to the payment of the principal of or the interest on the Bonds. The Successor Agency has no taxing power.
Reserve Account Surety Bond
In order to further secure the payment of the principal of and interest on the Bonds, a separate Reserve
Account has been established by the Trustee under the Indenture. The Reserve Account will be funded by
the purchase of a Municipal Bond Debt Service Reserve Insurance Policy (the “2021 Reserve Policy”)
issued by [________] in an amount equal to the Reserve Requirement for the Bonds as defined in the
Indenture. See “SECURITY FOR THE BONDS - Reserve Account.”
Legal Matters
All legal proceedings in connection with the issuance of the Bonds are subject to the approving opinion of
Rutan & Tucker, LLP, Irvine, California, as Bond Counsel (“Bond Counsel”). Such opinion, and certain
tax consequences incident to the ownership of the Bonds, including certain exceptions to the tax treatment
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of interest, are described more fully under the heading “TAX MATTERS” herein. Certain legal matters will
be passed on for the Successor Agency by Nixon Peabody LLP, Los Angeles, California, as Disclosure
Counsel, by the City Attorney, as General Counsel to the Successor Agency, and for the Underwriter by
their Counsel, Best Best & Krieger LLP, Riverside, California.
Offering of the Bonds
Authority for Issuance. The Bonds are to be issued and secured pursuant to the Indenture, as authorized
by Resolution No. 2020-001 of the Successor Agency adopted on October 6, 2020 and an Amended and
Restated Resolution No. _____ adopted on December 15, 2020, the Refunding Law and the Law. The
Countywide Oversight Board (the “Oversight Board”) approved the action taken by the Successor Agency
to refinance the 2013 Bonds on November 5, 2020 and to refinance the 2014 Bonds on January 7, 2021.
The State Department of Finance approved the Oversight Board actions by letter dated _________, 2021.
Offering and Delivery of the Bonds. The Bonds are being sold to Hilltop Securities Inc. (the
“Underwriter”). The Bonds are offered, when, as and if issued, subject to the approval as to their legality
by Bond Counsel. It is anticipated that the Bonds, in book-entry form, will be available for delivery through
the facilities of The Depository Trust Company on or about __________, 2021.
Summary Not Definitive
The summaries and references contained herein with respect to the Indenture, the Bonds and other statutes
or documents do not purport to be comprehensive or definitive and are qualified by reference to each such
document or statute, and references to the Bonds are qualified in their entirety by reference to the form
thereof included in the Indenture. Copies of these documents may be obtained after delivery of the Bonds
from the Successor Agency at 78-495 Calle Tampico, La Quinta, California 92253.
[Remainder of Page Intentionally Left Blank]
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THE BONDS
General Provisions
Repayment of the Bonds. Interest on the Bonds is payable at the rates per annum set forth on the inside
cover page hereof. Interest on the Bonds will be computed on the basis of a 360-day year comprised of
twelve 30-day months.
Interest on the Bonds will be payable on March 1 and September 1 (each an “Interest Payment Date”),
commencing September 1, 2021, and thereafter from the Interest Payment Date next preceding the date of
authentication thereof, unless (a) it is authenticated after a Regular Record Date and on or before the
following Interest Payment Date, in which event it shall bear interest from such Interest Payment Date; or
(b) a Bond is authenticated on or before August 15, 2021, in which event it shall bear interest from the
Delivery Date; provided, however, that if, as of the date of authentication of any Bond, interest thereon is
in default, such Bond shall bear interest from the Interest Payment Date to which interest has previously
been paid or made available for payment thereon.
Interest on the Bonds shall be payable on each Interest Payment Date to the person whose name appears on
the Registration Books as the Owner thereof as of the Regular Record Date immediately preceding each
such Interest Payment Date, such interest to be paid by check of the Trustee mailed on the Interest Payment
Date by first class mail to such Owner at the address of such Owner as it appears on the Registration Books;
provided, however, that upon the written request of any Owner of at least $1,000,000 in principal amount
of Bonds received by the Trustee at least fifteen (15) days prior to such Regular Record Date, payment shall
be made by wire transfer in immediately available funds to an account in the United States designated by
such Owner. Principal of and redemption premium (if any) on any Bond shall be paid upon presentation
and surrender thereof, at maturity or redemption, at the Trust Office of the Trustee. Both the principal of
and interest on the Bonds shall be payable in lawful money of the United States of America.
The Bonds are authorized to be issued in denominations of $5,000 or any integral multiple thereof, and will
be dated as of the date of their original delivery.
Transfer or Exchange of Bonds. So long as the Bonds are in the book-entry system of The Depository
Trust Company (“DTC”) as described below, the rules of DTC will apply for the transfer and exchange of
Bonds.
Book-Entry System. DTC will act as securities depository for the Bonds. The Bonds will be issued as
fully registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other
name as may be requested by an authorized representative of DTC. Interest on and principal of the Bonds
will be payable when due by wire of the Trustee to DTC which will in turn remit such interest and principal
to DTC Participants, which will in turn remit such interest and principal to Beneficial Owners of the Bonds
(see “APPENDIX G - THE BOOK-ENTRY SYSTEM” herein). As long as DTC is the registered owner of the
Bonds and DTC’s book-entry method is used for the Bonds, the Trustee will send any notices to Bond
Owners only to DTC.
DTC may discontinue providing its services as securities depository with respect to the Bonds at any time
by giving reasonable notice to the Successor Agency or the Trustee. Under such circumstances, if a
successor securities depository is not obtained, Bonds are required to be printed and delivered as described
in the Indenture. The Successor Agency may decide to discontinue use of the system of book-entry transfers
through DTC (or a successor securities depository). In that event, the Bonds will be printed and delivered
as described in the Indenture.
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Redemption
Optional Redemption. The Bonds maturing on or after September 1, 2031 are subject to optional
redemption prior to maturity on or after September 1, 2030 at the option of the City, in whole, or in part, on
any date, at a redemption price equal to the principal amount of the Bonds to be redeemed, plus accrued but
unpaid interest to the redemption date, without premium.
Mandatory Sinking Fund Redemption. The Bonds maturing on September 1, ____ (the “Term Bonds”)
are subject to mandatory redemption in part, by lot, on September 1, ____ and on September 1, ____, at a
redemption price equal to the principal amount thereof together with accrued interest thereon to the
redemption date, without premium, from minimum sinking fund payments on hand in the Debt Service
Fund in the years and amounts as follows.
Term Bonds Maturing on September 1, 2034
Sinking Fund Redemption Date (September 1)
Principal Amount to be Redeemed or Purchased
(Maturity)
Purchase In Lieu of Redemption. In lieu of optional or sinking fund redemption of the Bonds, amounts
on deposit in the Redevelopment Obligation Retirement Fund (to the extent not required to be transferred
to the Trustee during the current Bond Year) may also be used and withdrawn by the Agency at any time
for the purchase of the Bonds at public or private sale as and when and at such prices (including brokerage
and other charges and including accrued interest) as the Agency may in its discretion determine, as long as
it complies with ROPS authorization for expenditure of such amounts. The par amount of any of the Bonds
so purchased by the Agency and surrendered to the Trustee for cancellation in any twelve-month period
ending on August 15, in any year will be credited towards and will reduce the principal amount of the Bonds
otherwise required to be redeemed on the following September 1 pursuant to the Indenture.
Notice of Redemption; Conditional Notice. The Trustee on behalf and at the expense of the Agency shall
mail (by first class mail) notice of any redemption to the respective Owners of any Bonds designated for
redemption at their respective addresses appearing on the Registration Books, at least 30 but not more than
60 days prior to the date fixed for redemption. Such notice shall state the date of the notice, the redemption
date, the redemption place and the redemption price and shall designate the CUSIP numbers, if any, the
Bond numbers and the maturity or maturities of the Bonds to be redeemed (except in the event of
redemption of all of the Bonds of such maturity or maturities in whole), and shall require that such Bonds
be then surrendered at the Office of the Trustee for redemption at the redemption price, giving notice also
that further interest on such Bonds will not accrue from and after the date fixed for redemption. Neither
the failure to receive any notice so mailed, nor any defect in such notice, shall affect the validity of the
proceedings for the redemption of the Bonds or the cessation of accrual of interest thereon from and after
the date fixed for redemption.
With respect to any notice of any optional redemption of Bonds, unless at the time such notice is given the
Bonds to be redeemed shall be deemed to have been paid, such notice shall state that such redemption is
conditional upon receipt by the Trustee, on or prior to the date fixed for such redemption, of moneys that,
together with other available amounts held by the Trustee, are sufficient to pay the redemption price of, and
accrued interest on, the Bonds to be redeemed, and that if such moneys shall not have been so received said
notice shall be of no force and effect and the Successor Agency shall not be required to redeem such Bonds.
In the event a notice of redemption of Bonds contains such a condition and such moneys are not so received,
the redemption of Bonds as described in the conditional notice of redemption shall not be made and the
Trustee shall, within a reasonable time after the date on which such redemption was to occur, give notice
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to the Persons and in the manner in which the notice of redemption was given, that such moneys were not
so received and that there shall be no redemption of Bonds pursuant to such notice of redemption.
Scheduled Debt Service on the Bonds
The following is the scheduled semi-annual debt service on the Bonds.
Payment Date
Principal
Interest
Semi-Annual
Debt Service
Annual
Debt Service
September 1, 2021
March 1, 2022
September 1, 2022
March 1, 2023
September 1, 2023
March 1, 2024
September 1, 2024
March 1, 2025
September 1, 2025
March 1, 2026
September 1, 2026
March 1, 2027
September 1, 2027
March 1, 2028
September 1, 2028
March 1, 2029
September 1, 2029
March 1, 2030
September 1, 2030
March 1, 2031
September 1, 2031
March 1, 2032
September 1, 2032
March 1, 2033
September 1, 2033
March 1, 2034
September 1, 2034
Total
[Remainder of Page Intentionally Left Blank]
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THE FINANCING PLAN
The Refunding Plan
On the Delivery Date, a portion of the proceeds of the Bonds will be transferred to the Trustee as escrow
bank (“Escrow Bank”) for deposit pursuant to an Escrow Agreement dated as of ______ 1, 2021 (the
“Escrow Agreement”) between the Successor Agency and the Escrow Bank. The amount deposited under
the Escrow Agreement, together with other available moneys and earnings thereon, will be irrevocably
pledged for the payment of the Refunded Bonds as follows:
• to the payment of the principal and interest of the 2013 Series A Bonds when due, through and
including September 1, 2023 and to the redemption in full on September 1, 2023 of the $56,150,000
outstanding 2013 Series A Bonds maturing on or after September 1, 2024 at a redemption price
equal to 100% of the principal amount of the 2013 Series A Bonds to be redeemed together with
accrued interest thereon to the date fixed for redemption, without premium,
• to the payment of the principal and interest of the 2013 Series B Bonds when due, through and
including September 1, 2023 and to the redemption in full on September 1, 2023 of the $13,160,000
outstanding 2013 Series B Bonds maturing on or after September 1, 2024 at a redemption price
equal to 100% of the principal amount of the 2013 Series B Bonds to be redeemed together with
accrued interest thereon to the date fixed for redemption, without premium, and
• to the payment of the principal and interest of the 2014 Bonds when due, through and including
September 1, 2024 and to the redemption in full on September 1, 2024 of the $40,630,000
outstanding 2014 Bonds maturing on or after September 1, 2025 at a redemption price equal to
100% of the principal amount of the 2014 Bonds to be redeemed together with accrued interest
thereon to the date fixed for redemption, without premium.
Amounts so deposited under the Escrow Agreement will be pledged respectively to the payment of principal
and interest when due or to the payment of the redemption price of the Refunded Bonds on the respective
redemption dates and the sufficiency of the amounts deposited under the Escrow Agreement for such
purpose will be verified by __________. The lien of the Refunded Bonds will be discharged, terminated
and of no further force and effect upon the deposit with the Escrow Bank of the amounts required pursuant
to the Escrow Agreement.
The amounts held by the Escrow Bank for the respective Refunded Bonds under the Escrow Agreement are
pledged solely to the payment of amounts due and payable by the Successor Agency under the Escrow
Agreement. The funds deposited under the Escrow Agreement will not be available for the payment of debt
service on the Bonds.
[Remainder of Page Intentionally Left Blank]
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Estimated Sources and Uses of Funds
Under the provisions of the Indenture, the Trustee will receive the proceeds from the sale of the Bonds and
other available funds and will apply them as shown below.
Sources of Funds
Par Amount of Bonds
Funds Held for the Refunded Bonds
Total Source of Funds
Uses of Funds
Transfer to Escrow Bank
Underwriter’s Discount
Costs of Issuance Fund (1)
Total Use of Funds ______________________________
(1) Costs of issuance include fees and expenses of Bond Counsel, the Municipal Advisor, Disclosure Counsel,
Verification Agent, Trustee and Escrow Bank, costs of printing the Official Statement, rating fee and other costs
of issuance of the Bonds.
THE DISSOLUTION ACT
The Dissolution Act requires the County Auditor-Controller to determine the amount of property taxes that
would have been allocated to the Prior Agency (pursuant to subdivision (b) of Section 16 of Article XVI
of the State Constitution) had the Prior Agency not been dissolved pursuant to the operation of AB X1 26,
using current assessed values on the last equalized roll on August 20, and to deposit that amount in the
Redevelopment Property Tax Trust Fund for the Successor Agency established and held by the County
Auditor-Controller pursuant to the Dissolution Act. The Redevelopment Property Tax Trust Fund is
sometimes referred to herein as the “RPTTF.”
The Dissolution Act provides that any bonds authorized thereunder to be issued by the Successor Agency
will be considered indebtedness incurred by the Prior Agency, with the same lien priority and legal effect
as if the bonds had been issued prior to the effective date of AB X1 26, in full conformity with the
applicable provisions of the Redevelopment Law that existed prior to that date, and will be included in the
Successor Agency’s Recognized Obligation Payment Schedules (see “SECURITY FOR THE BONDS -
Recognized Obligation Payment Schedules”).
The Dissolution Act further provides that bonds authorized by the Dissolution Act to be issued by the
Successor Agency will be secured by a pledge of, and lien on, and will be repaid from moneys deposited
from time to time in the Redevelopment Property Tax Trust Fund, and that property tax revenues pledged
to any bonds authorized to be issued by the Successor Agency under the Dissolution Act, including the
Bonds, are taxes allocated to the Successor Agency pursuant to subdivision (b) of Section 33670 of the
Redevelopment Law and Section 16 of Article XVI of the State Constitution.
Pursuant to subdivision (b) of Section 33670 of the Redevelopment Law and Section 16 of Article XVI of
the State Constitution and as provided in the Redevelopment Plans, taxes levied upon taxable property in
the Project Areas each year by or for the benefit of the State, any city, county, city and county, district, or
other public corporation (herein sometimes collectively called “taxing agencies”) after the effective date
of the ordinance approving the related Redevelopment Plan, or the respective effective dates of ordinances
approving amendments to the related Redevelopment Plan that added territory to a Project Area, if any,
are to be divided as follows:
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(a) To Taxing Agencies: That portion of the taxes which would be produced by the rate upon which
the tax is levied each year by or for each of the taxing agencies upon the total sum of the assessed
value of the taxable property in a Project Area as shown upon the assessment roll used in connection
with the taxation of such property by such taxing agency last equalized prior to the effective date
of the ordinance adopting the Redevelopment Plan (the “base year valuation”), will be allocated to,
and when collected will be paid into, the funds of the respective taxing agencies as taxes by or for
the taxing agencies on all other property are paid; and
(b) To the Prior Agency/Successor Agency: Except for that portion of the taxes in excess of the amount
identified in (a) above which are attributable to a tax rate levied by a taxing agency for the purpose
of producing revenues in an amount sufficient to make annual repayments of the principal of, and
the interest on, any bonded indebtedness approved by the voters of the taxing agency on or after
January 1, 1989 for the acquisition or improvement of real property, which portion shall be
allocated to, and when collected shall be paid into, the fund of that taxing agency, that portion of
the levied taxes each year in excess of such amount, annually allocated within limitations
established by the Redevelopment Plan, following the date of issuance of the Bonds, when collected
will be paid into a special fund of the Successor Agency. Section 34172 of the Dissolution Act
provides that, for purposes of Section 16 of Article XVI of the State Constitution, the
Redevelopment Property Tax Trust Fund shall be deemed to be a special fund of the Successor
Agency to pay the debt service on indebtedness incurred by the Prior Agency or the Successor
Agency to finance or refinance the redevelopment projects of the Prior Agency.
That portion of the levied taxes described in paragraph (b) above, less amounts deducted pursuant to
Section 34183(a) of the Dissolution Act for permitted administrative costs of the County Auditor-
Controller, constitute the amounts required under the Dissolution Act to be deposited by the County
Auditor-Controller into the Redevelopment Property Tax Trust Fund. In addition, Section 34183 of the
Dissolution Act effectively eliminates the January 1, 1989 date from paragraph (b) above. Pursuant to SB
107, effective September 22, 2015, debt service override revenues approved by the voters for the purpose
of supporting pension programs or capital projects, and programs related to the State Water Project, that
are not pledged to or needed for debt service on successor agency obligations are allocated and paid to the
entity that levies the override and will not be deposited into the Redevelopment Property Tax Trust Fund.
Therefore, overrides levied within the Project Areas are not pledged to the payment of debt service on the
Bonds.
SECURITY FOR THE BONDS
Pledged Tax Revenues
Definition of Pledged Tax Revenues. For the security of the Bonds, the Successor Agency grants a pledge
of and lien on all of the Pledged Tax Revenues. “Pledged Tax Revenues” are defined under the Indenture
as the portion of the monies deposited from time to time in the Redevelopment Property Tax Trust Fund, as
provided in Section 34183(a)(2) of the Dissolution Act less the amount required to pay debt service on the
Senior Bonds. The 2014 Bonds are the only Senior Bonds of the Successor Agency. After issuance of the
Bonds, no Senior Bonds will remain outstanding.
Under the Dissolution Act, monies deposited from time to time in the Redevelopment Property Tax Trust
Fund means taxes that were eligible for allocation to the Prior Agency with respect to the Project Areas and
are allocated to the Successor Agency pursuant to Article 6 of Chapter 6 (commencing with Section 33670)
of the Law and Section 16 of Article XVI of the Constitution of the State, or pursuant to other applicable
State laws. The deposit in the Redevelopment Property Tax Trust Fund excludes amounts first paid pursuant
to Section 34183(a)(1) of the Dissolution Act, under Contractual Tax Sharing Agreements and as Statutory
Tax Sharing (as defined below), except as described below.
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“Contractual Tax Sharing Agreements” are defined herein to mean those agreements entered into by the
Prior Agency with certain taxing agencies pursuant to Health & Safety Code Section 33401, and providing
for the payment of a portion of tax increment revenues allocable to such taxing agency. Certain payments
due under Contractual Tax Sharing Agreements are subordinate to bonded indebtedness of the Prior Agency
(“Subordinated Pass-Through Amounts”). “Statutory Tax Sharing” means those payments due to taxing
agencies pursuant to the provisions of Health & Safety Code Sections 33607.5 and 33607.7.
By definition, under the Dissolution Act, Pledged Tax Revenues are net of the County’s administrative costs
allowed under Section 34182 of the Dissolution Act and Section 95.3 of the Revenue and Taxation Code.
See “FINANCIAL INFORMATION - Property Taxation in California” and “- Tax Sharing Agreements and
Tax Sharing Statutes” herein.
The Successor Agency believes that pursuant to the Dissolution Act that the Subordinated Pass-Through
Amounts in Project Area No. 1, in certain circumstances, would be available pursuant to Health & Safety
Code Section 34183(b) to pay debt service on the Bonds and the 2016 Parity Bonds. The Municipal Advisor
has included the Subordinated Pass-Through Amounts in Project Area No. 1 in calculating Pledged Tax
Revenues available to pay debt service shown in the table entitled “PROJECTED PLEDGED TAX
REVENUES.”
See “Pledge of Tax Revenues” below and “FINANCIAL INFORMATION - Tax Sharing Agreements and Tax
Sharing Statutes” herein.
Redevelopment Property Tax Trust Fund
Deposits to the Redevelopment Property Tax Trust Fund. Section 34172 of the Dissolution Act provides
that, for purposes of Section 16 of Article XVI of the State Constitution, the Redevelopment Property Tax
Trust Fund shall be deemed to be a special fund of the Successor Agency to pay the debt service on
indebtedness incurred by the Prior Agency or the Successor Agency to finance or refinance the
redevelopment projects of the Prior Agency.
Disbursements From the Redevelopment Property Tax Trust Fund. The Redevelopment Law
authorized redevelopment agencies to make payments to Taxing Agencies to alleviate any financial burden
or detriments to such Taxing Agencies caused by a redevelopment project. The Prior Agency entered into
a number of Contractual Tax Sharing Agreements with the Taxing Agencies for this purpose. Additionally,
Sections 33607.5 and 33607.7 of the Redevelopment Law required mandatory Statutory Tax Sharing
applicable to redevelopment projects adopted on or after January 1, 1994 or amended after January 1, 1994
in a manner specified in such section. The Successor Agency is also obligated to make certain Statutory
Tax Sharing payments. See “FINANCIAL INFORMATION - Tax Sharing Agreements and Tax Sharing
Statutes” herein).
Typically, under the Redevelopment Property Tax Trust Fund distribution provisions of the Dissolution Act,
a county auditor-controller is to distribute funds for each six-month period in the following order specified
in Section 34183 of the Dissolution Act:
(i) first, subject to certain adjustments (as described below) for subordinations to the extent permitted
under the Dissolution Act (if any, as described below under “FINANCIAL INFORMATION - Tax
Sharing Agreements and Tax Sharing Statutes”) and no later than each January 2 and June 1, to
each local taxing agency and school entity, to the extent applicable, amounts required for pass-
through payments such entity would have received under provisions of the Redevelopment Law, as
those provisions read on January 1, 2011, including the Contractual Tax Sharing Agreements and
the Statutory Tax Sharing Amounts;
(ii) second, on each January 2 and June 1, to the successor agency for payments listed in its Recognized
Obligation Payment Schedule, with debt service payments (and amounts required to replenish the
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related reserve funds, if any) scheduled to be made for tax allocation bonds having the highest
priority over payments scheduled for other debts and obligations listed on the Recognized
Obligation Payment Schedule;
(iii) third, on each January 2 and June 1, to the successor agency for the administrative cost allowance,
as defined in the Dissolution Act; and
(iv) fourth, on each January 2 and June 1, to taxing entities any moneys remaining in the
Redevelopment Property Tax Trust Fund after the payments and transfers authorized by clauses (i)
through (iii), in an amount proportionate to such taxing entity’s share of property tax revenues in
the tax rate area in that fiscal year (without giving effect to any pass-through obligations that were
established under the Redevelopment Law).
The Dissolution Act requires the County Auditor-Controller to distribute from the Redevelopment Property
Tax Trust Fund amounts required to be distributed under any Contractual Tax Sharing Agreements and
Statutory Tax Sharing to the Taxing Agencies on each January 2 and June 1 before amounts are distributed
by the County Auditor-Controller from the Redevelopment Property Tax Trust Fund to the Successor
Agency’s Redevelopment Obligation Retirement Fund, unless: (i) pass-through payment obligations have
been made subordinate to debt service payments for the bonded indebtedness of the Prior Agency, as
succeeded to by the Successor Agency; (ii) the Successor Agency has reported, no later than the December 1
and May 1 preceding the applicable January 2 or June 1 distribution date, that the total amount available to
the Successor Agency from the Redevelopment Property Tax Trust Fund allocation to the Successor
Agency’s Redevelopment Obligation Retirement Fund, from other funds transferred from the Prior Agency
and from funds that have or will become available through asset sales and all redevelopment operations is
insufficient to fund the Successor Agency’s enforceable obligations, pass-through payments and the
Successor Agency’s administrative cost allowance for the applicable Recognized Obligation Payment
Schedule period; and (iii) the State Controller has concurred with the Successor Agency that there are
insufficient funds for such purposes.
If the requirements set forth in clauses (i) through (iii) of the foregoing paragraph have been met, the
Dissolution Act provides for certain modifications in the distributions otherwise calculated to be distributed
on the applicable January 2 or June 1 property tax distribution date (as adjusted for weekends and holidays).
To provide for calculated shortages to be paid to the Successor Agency for enforceable obligations, the
amount of the deficiency will first be deducted from the residual amount otherwise calculated to be
distributed to the taxing entities under the Dissolution Act after payment of the Successor Agency’s
enforceable obligations, pass-through payments and the Successor Agency’s administrative cost allowance.
If such residual amount is exhausted, the amount of the remaining deficiency will be deducted from amounts
available for distribution to the Successor Agency for administrative costs for the applicable Recognized
Obligation Payment Schedule period in order to fund the enforceable obligations. Finally, funds required
for servicing bond debt may be deducted from the Subordinated Pass-Through Amounts to be distributed
under Contractual Tax Sharing Agreements, in order to be paid to the Successor Agency for enforceable
obligations, but only after the amounts described in the previous two sentences have been exhausted.
Pursuant to Contractual Tax Sharing Agreements with certain taxing agencies, such payments are
subordinate to any bonds of the Successor Agency in accordance with the terms of such agreements.
However, the Successor Agency cannot guarantee that the process prescribed by the Dissolution Act for
administering any subordinations provided in the Contractual Tax Sharing Agreements.
The Dissolution Act provides for a procedure by which the Successor Agency may make the payment of
Statutory Tax Sharing Amounts subordinate to the Bonds. The Successor Agency had not previously
undertaken proceedings to subordinate such payments to the Refunded Bonds. The Successor Agency will
not undertake any procedure to subordinate the Statutory Tax Sharing Amounts to the Bonds, and therefore,
Statutory Tax Sharing Amounts are not subordinate to the Bonds.
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See “FINANCIAL INFORMATION” and “APPENDIX B - MUNICIPAL ADVISOR’S PROJECTED TAX
REVENUES REPORT” for additional information regarding the Contractual Tax Sharing Agreements, the
Statutory Tax Sharing Amounts applicable to the Successor Agency and the revenues derived from the
Project Areas.
Recognized Obligation Payment Schedules
Enforceable Obligations. The Dissolution Act requires successor agencies to prepare and approve, and
submit to the successor agency’s oversight board and the State Department of Finance for approval, a
Recognized Obligation Payment Schedule pursuant to which enforceable obligations (as defined in the
Dissolution Act) of the successor agency are listed, together with the source of funds to be used to pay for
each enforceable obligation. As defined in the Dissolution Act, “enforceable obligation” includes bonds,
including the debt service, reserve set-asides, and any other payments required under the indenture or
similar documents governing the issuance of the outstanding bonds of the former redevelopment agency,
as well as other obligations such as loans, judgments or settlements against the former redevelopment
agency, any legally binding and enforceable agreement that is not otherwise void as violating the debt limit
or public policy, contracts necessary for the administration or operation of the successor agency, and
amounts borrowed from the Low and Moderate Income Housing Fund and from the city. A reserve may be
included on the Recognized Obligation Payment Schedule and held by the successor agency when required
by the bond indenture or when the next property tax allocation will be insufficient to pay all obligations
due under the provisions of the bond for the next payment due in the following six-month period (see
“APPENDIX A - SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE - Other Covenants of the
Successor Agency”). The Successor Agency has covenanted to request such reserves as described below.
Under the Dissolution Act, the categories of sources of payments for enforceable obligations listed on a
Recognized Obligation Payment Schedule are the following: (i) the former low and moderate income
housing fund, (ii) bond proceeds, (iii) reserve balances, (iv) administrative cost allowance, (v) the
Redevelopment Property Tax Trust Fund (but only to the extent no other funding source is available or
when payment from property tax revenues is required by an enforceable obligation or otherwise required
under the Dissolution Act), or (vi) other revenue sources (including rents, concessions, asset sale proceeds,
interest earnings, and any other revenues derived from the former redevelopment agency, as approved by
the oversight board). Other than amounts deposited in the Redevelopment Property Tax Trust Fund and
amounts held in funds and accounts under the Indenture, the Successor Agency does not expect to have any
other funds available to pay the Bonds.
The Dissolution Act provides that only those payments listed in the Recognized Obligation Payment
Schedule may be made by the Successor Agency from the funds specified in the Recognized Obligation
Payment Schedule.
Required Approvals. As provided in SB 107, the Recognized Obligation Payment Schedule, with respect
to each fiscal year, and segregated into each six-month period beginning July 1 and January 1, must be
submitted by the Successor Agency, after approval by the Oversight Board, to the County Auditor-
Controller, the State Department of Finance, and the State Controller by each February 1. For information
regarding procedures under the Dissolution Act relating to late Recognized Obligation Payment Schedules
and implications thereof on the Bonds, see “RISK FACTORS - Last and Final Recognized Obligation
Payment Schedule.”
Commencing on September 22, 2015, successor agencies that have received a Finding of Completion and
the concurrence of the Department of Finance as to the items that qualify for payment, among other
conditions, may at their option, file a “Last and Final” Recognized Obligation Payment Schedule. If
approved by the Department of Finance, the Last and Final Recognized Obligation Payment Schedule will
be binding on all parties, and the Successor Agency will no longer submit a Recognized Obligation Payment
Schedule to the Department of Finance or the Oversight Board. The County Auditor-Controller will remit
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the authorized funds to the Successor Agency in accordance with the approved Last and Final Recognized
Obligation Payment Schedule until each remaining enforceable obligation has been fully paid.
A Last and Final Recognized Obligation Payment Schedule may only be amended twice, and only with
approval of the Department of Finance and the County Auditor-Controller. On November 22, 2017, the
Department of Finance approved the Successor Agency’s Last and Final Recognized Obligation Payment
Schedule (“Last and Final ROPS”). Upon issuance of the Bonds, the Successor Agency will request the
Department of Finance to approve an amendment to the Last and Final Recognized Obligation Payment
Schedule (“Amended Last and Final ROPS”), to reflect the reduced debt service on the Bonds compared to
the debt service approved for the Refunded Bonds.
Determination of Available Funding. In connection with the allocation and distribution by the County
Auditor-Controller of property tax revenues deposited in the Redevelopment Property Tax Trust Fund,
under the Dissolution Act the County Auditor-Controller must prepare estimates of the amounts of (i)
property tax to be allocated and distributed, and (ii) the amounts of pass-through payments to be made in
the upcoming six-month period, and provide those estimates to the entities receiving the distributions and
the State Department of Finance no later than April 1 and October 1 of each year, as applicable.
If, after receiving such estimate from the County Auditor-Controller, the Successor Agency determines and
reports, no later than December 1 or May 1, as applicable, that the total amount available to the Successor
Agency from the Redevelopment Property Tax Trust Fund allocation to the Successor Agency’s
Redevelopment Obligation Retirement Fund, from other funds transferred from the Prior Agency, and from
funds that have or will become available through asset sales and all redevelopment operations, is insufficient
to fund the payment of pass-through obligations, the Successor Agency’s enforceable obligations listed on
the Recognized Obligation Payment Schedule, and the Successor Agency’s administrative cost allowance,
the County Auditor-Controller must notify the State Controller and the State Department of Finance no later
than 10 days from the date of the Successor Agency’s notification. If the State Controller concurs that there
are insufficient funds to pay required debt service, the Dissolution Act provides for certain adjustments to
be made to the estimated distributions, as described in more detail under “Redevelopment Property Tax
Trust Fund” above.
Debt Service. In the Indenture, the Successor Agency covenants to comply with all of the requirements of
the Dissolution Act, including taking all actions required under the Dissolution Act to prepare and file an
amendment to the Last and Final Recognized Obligation Payment Schedule so as to enable the County
Auditor-Controller to distribute from the Redevelopment Property Tax Trust Fund for deposit in the
Redevelopment Obligation Retirement Fund all Pledged Tax Revenues as shall be required to enable the
Successor Agency to pay timely principal of, and interest on, the Bonds coming due in the related Bond
Year.
[The Successor Agency further agrees not to submit the final amendment permitted for its Last and Final
Recognized Obligation Payment Schedule under the Dissolution Act without the prior written consent of
____.]
The Successor Agency has no power to levy and collect taxes, and various factors beyond its control could
affect the amount of Pledged Tax Revenues available in any six-month period (or otherwise) to pay the
principal of and interest on the Bonds. See “RISK FACTORS.”
Pledge of Pledged Tax Revenues
The Successor Agency has established the Redevelopment Obligation Retirement Fund pursuant to Section
34170.5(a) of the Law which the Successor Agency shall continue to hold and maintain so long as any of
the Bonds are Outstanding. The Successor Agency will deposit all of amounts received in any Bond Year
from the Redevelopment Property Tax Trust Fund in the Redevelopment Obligation Retirement Fund
promptly upon receipt thereof.
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The Bonds and the 2016 Parity Bonds shall be secured by a first pledge of and lien on all of the Pledged
Tax Revenues in the Redevelopment Obligation Retirement Fund, the Debt Service Fund and accounts
therein created under the Indenture. The Bonds and the 2016 Parity Bonds are payable from monies
received from the Redevelopment Property Tax Trust Fund.
The Indenture established a special trust fund known as the “Debt Service Fund,” and the accounts therein
referred to below, which will be held by the Trustee. After depositing the amounts required to pay the
Senior Bonds (if any) in the then current Bond Year with the trustee for the Senior Bonds, the Successor
Agency will promptly thereafter shall deposit amounts in the Redevelopment Obligation Retirement Fund
to the Debt Service Fund established and held under the Indenture until such time during such Bond Year
as the amounts so transferred to the Debt Service Fund under the Indenture equal the aggregate amounts
required to be transferred to the Trustee for deposit into the Interest Account, the Principal Account and the
Reserve Account of the Debt Service Fund in such Bond Year for the Bonds and the 2016 Parity Bonds
pursuant to the Indenture and for deposit in such Bond Year in the funds and accounts established with
respect to any other Parity Bonds, as provided in any Supplemental Indenture.
The Pledged Tax Revenues are pledged to the payment of principal of and interest on the Bonds pursuant
to the Indenture until the Bonds have been paid, or until moneys have been set-aside irrevocably for that
purpose. The Trustee will covenant to exercise such rights and remedies as may be necessary to enforce
the payment of the Pledged Tax Revenues when due under the Indenture, and otherwise to protect the
interests of the Bondholders in the event of default by the Successor Agency.
If the amount of Pledged Tax Revenues available in such Bond Year is insufficient to deposit the full amount
required to be deposited under the Indenture for the Bonds and the 2016 Parity Bonds, the Trustee shall
apply such amounts to debt service, ratably based on the full amounts required to be deposited without
preference or priority for series as further described in “APPENDIX A - SUMMARY OF CERTAIN
PROVISIONS OF THE INDENTURE - Events of Default and Remedies.”
All Pledged Tax Revenues received by the Successor Agency during any Bond Year in excess of the amount
required to be transferred to the Trustee during such Bond Year shall be released from the pledge and lien
of the Indenture for the security of the Bonds and shall be applied by the Successor Agency for any lawful
purposes of the Successor Agency.
The Bonds are special obligations of the Successor Agency. The Bonds do not constitute a debt or liability of the City, the County, the State or of any political subdivision thereof, other than the Successor Agency. The Successor Agency shall only be obligated to pay the principal of the Bonds, or the interest thereon, from the funds described herein, and neither the faith and credit nor the taxing power of the City, the County, the State or any of its political subdivisions is pledged to the payment of the principal of or the interest on the Bonds. The Successor Agency has no taxing power.
The State Legislature has amended the Dissolution Act several times. The Successor Agency expects, but
cannot guarantee, that the processes for funding of enforceable obligations prescribed by any new
legislative change in the Dissolution Act will not interfere with its administering of the Pledged Tax
Revenues in accordance with the Indenture and will effectively result in adequate Pledged Tax Revenues
for the timely payment of principal of and interest on the Bonds when due.
No Additional Debt Other Than Refunding Bonds
Under the Indenture, in addition to the Bonds and the 2016 Parity Bonds, the Successor Agency may issue
or incur additional tax allocation bonds secured by a pledge and lien on Pledged Tax Revenues on a parity
with the Bonds and the 2016 Parity Bonds (“Parity Bonds”) in such principal amount as shall be determined
by the Successor Agency, pursuant to a separate or Supplemental Indenture adopted or entered into by the
Successor Agency and Trustee and for such purposes as are permitted under the Dissolution Act, including
without limitation Section 34177.5 thereof.
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Subject to the foregoing, the Successor Agency may issue or incur such Parity Bonds subject to the
following additional specific conditions precedent:
(a) The Successor Agency will be in compliance with all covenants set forth in the Indenture;
(b) The Oversight Board shall have approved the issuance of Parity Bonds;
(c) The Parity Bonds will be on such terms and conditions as may be set forth in a separate or
Supplemental Indenture, which will provide for (i) bonds substantially in accordance with the
Indenture, and (ii) the deposit of moneys or Alternate Reserve Account Security into the Reserve
Account in an amount sufficient, together with the balance of the Reserve Account, to equal the
Reserve Requirement on all Bonds and 2016 Parity Bonds expected to be outstanding including the
Bonds;
(d) Receipt of a certificate or opinion of an Independent Financial Consultant stating:
(i) For the current and each future Bond Year the debt service for each such Bond Year with
respect to all Bonds and other Parity Bonds reasonably expected to be outstanding
following the issuance of the Parity Bonds;
(ii) For the then current fiscal year, the Pledged Tax Revenues to be received by the Agency
based upon the most recently certified assessed valuation of taxable property in the Project
Areas provided by the appropriate officer of the County;
(iii) For each future fiscal year, the Pledged Tax Revenues referred to in item (ii) together with
(a) the amount determined in accordance with Section 51(a) of the California Revenue
and Taxation Code (2% inflationary growth) and (b) the amount of Pledged Tax Revenues
to be payable with respect to construction completed but not yet on the tax roll, and taking
into account the expiration of the time to receive Pledged Tax Revenues with respect to
any portion of the Project Areas and any amounts to be paid pursuant to the Pass-Through
Agreements and the Statutory Pass-Through Amounts; and
(iv) That for the then current fiscal year, the Pledged Tax Revenues referred to in item (ii) and
for each future fiscal year the Pledged Tax Revenues referred to in item (iii) are at least
equal to the sum of 125% of the Maximum Annual Debt Service with respect to the
amounts referred to in item (i) above, and, for the then current fiscal year, 100% of Annual
Debt Service with respect to any subordinate debt and that the Agency is entitled under
the Dissolution Act, the Redevelopment Law and the Redevelopment Plans to receive
taxes under Section 33670 of the Redevelopment Law in an amount sufficient to meet
expected debt service with respect to all Bonds, and other Parity Bonds.
(e) The Parity Bonds will mature on and interest will be payable on the same dates as the Bonds (except
the first interest payment may be from the date of the Parity Bonds until the next succeeding
March 1 or September l) provided, however, nothing herein shall preclude the Successor Agency
from issuing and selling Parity Bonds which do not pay current interest.
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THE SUCCESSOR AGENCY
As described in “INTRODUCTION,” the Prior Agency was dissolved as of February 1, 2012 pursuant to the
Dissolution Act. Thereafter, the City became the Successor Agency and the City Council serves as the
governing board of the Successor Agency.
Section 34173(g) of the Dissolution Act expressly affirms that the Successor Agency is a separate public
entity from the City, that the two entities shall not merge, and that the liabilities of the Prior Agency will
not be transferred to the City nor will the assets of the Prior Agency become assets of the City.
The City performs certain general administrative functions for the Successor Agency. The City Manager
serves as the Successor Agency’s Executive Director, the City Clerk serves as the Successor Agency
secretary and the Finance Director serves as the Successor Agency treasurer.
Successor Agency Powers
All powers of the Successor Agency are vested in its members, who are the elected members of the City
Council. Pursuant to the Dissolution Act, the Successor Agency is a separate public body from the City
and succeeds to the organizational status of the Prior Agency but without any legal authority to participate
in redevelopment activities, except to complete any work related to an approved enforceable obligation.
The Successor Agency is tasked with expeditiously winding down the affairs of the Prior Agency, pursuant
to the procedures and provisions of the Dissolution Act. Under the Dissolution Act, many Successor
Agency actions are subject to approval by the Oversight Board, as well as review by the State Department
of Finance.
Section 34179.5 of the Dissolution Act established a due diligence review process for determining the
unobligated balances that redevelopment agencies had available as of June 30, 2012 to remit to their
respective county auditor-controllers for distribution to affected Taxing Agencies within project areas of the
former redevelopment agencies. The Successor Agency has remitted to the County Auditor-Controller all
of the unobligated balances as determined by the State Department Finance. On November 6, 2013, the
Successor Agency received its Finding of Completion from the State Department of Finance. Receipt of
the Finding of Completion allows the Successor Agency to do several things, among them, developing a
plan for the disposition of any properties held by the Successor Agency and spending proceeds of bonds
issued prior to December 31, 2010, all requiring approval of the Oversight Board.
After receiving the finding of completion, each successor agency was required to submit a Long Range
Property Management Plan (a “Long Range Property Management Plan”) detailing what it intended to do
with its inventory of properties. Successor agencies were not required to immediately dispose of their
properties but are limited in terms of what they can do with the retained properties. Permissible uses
include: sale of the property, use of the property to fulfill an enforceable obligation, retention of the property
for future redevelopment, and retention of the property for governmental use. These plans must be filed by
successor agencies with the State Department of Finance within six months of receiving a finding of
completion. The State Department of Finance approved the Successor Agency’s Long Range Property
Management Plan on ______________. The Successor Agency has disposed of all property held at the
time of dissolution.
Redevelopment Plans
The City Council approved and adopted the Redevelopment Plan for Project Area No. 1 on November 29,
1983, pursuant to Ordinance No. 43. It was subsequently amended on December 20, 1994 pursuant to
Ordinance No. 258 to add limitations prescribed by AB 1290, again on March 21, 1995 pursuant to
Ordinance No. 264 to amend financial limits and time to initiate eminent domain actions, on August 19,
2003 pursuant to Ordinance No. 388 to eliminate the time limit to incur debt as authorized by SB 211 and
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again on March 16, 2004 pursuant to Ordinance No. 402 to extend the Redevelopment Plan duration by one
year as authorized by SB 1045.
The City Council approved and adopted the Redevelopment Plan for Project Area No. 2 on May 16, 1989,
pursuant to Ordinance No. 139. It was subsequently amended on December 20, 1994 pursuant to Ordinance
No. 259 to add limitations prescribed by AB 1290, again on February 3, 2004 pursuant to Ordinance No.
399 to amend financial limits, on March 16, 2004 pursuant to Ordinance Nos. 403 and 404 to eliminate the
time limit to incur debt as authorized by SB 211 and to extend the Redevelopment Plan duration by one
year as authorized by SB 1045, and again on February 1, 2011 pursuant to Ordinance No. 485 to add
territory for purposes of affordable housing.
SB 107 Effects on Plan Limits
In accordance with the Redevelopment Law, redevelopment plans were required to include certain limits
on the financing of redevelopment projects. These limits could include a time limit on the life of the
redevelopment plan, a time limit to incur debt, a time limit on the receipt of Tax Increment Revenues and
the repayment of debt, and a limit on the amount of bonded indebtedness outstanding at any time.
SB 107, which was enacted in September 2015, contains provisions (the “SB 107 Plan Limits Provisions”)
which generally provide that, for the purpose of paying enforceable obligations (as such term is defined by
the Dissolution Act), such as the Bonds, the Successor Agency is no longer subject to the Plan Limits. In
contrast, for all other purposes, including pass-through payments to taxing entities (which are not
“enforceable obligations” because they are now paid not by the Successor Agency but by the County
Auditor-Controller directly from Redevelopment Property Tax Trust Fund disbursements), the County
Auditor-Controller has confirmed that it will continue to recognize the Plan Limits. As a matter of practical
implementation of the SB 107 Plan Limits Provisions, the County Auditor-Controller will deposit into the
Redevelopment Property Tax Trust Fund an amount of property tax revenues derived from a Project Area
above the Plan Limits only in a situation where there would not be sufficient moneys in the Redevelopment
Property Tax Trust Fund to make payments on outstanding enforceable obligations.
See “APPENDIX B - MUNICIPAL ADVISOR’S PROJECTED TAX REVENUES REPORT.”
[Remainder of Page Intentionally Left Blank]
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THE PROJECT AREAS
Description of the Project Areas
Project Area No. 1 encompasses approximately 17.9 square miles (11,475 acres) accounting for
approximately fifty percent (50%) of the total current corporate area of the City.
Project Area No. 2 encompasses approximately 4.9 square miles (3,130 acres) accounting for approximately
fourteen percent (14%) of the total current corporate area of the City.
The Project Areas are primarily developed with residential uses.
Assessed Valuations and Pledged Tax Revenues
The Fiscal Year 2020-21 assessed value by land use in each Project Area is shown in Table No. 1 below.
TABLE NO. 1
ASSESSED VALUE BY LAND USE
% of % of
Category Project No. 1 Total Project No. 2 Total
Residential $5,154,419,388 90.8% $2,351,978,497 73.6%
Commercial 271,515,396 4.8% 700,223,148 21.9%
Recreational 94,955,318 1.7% 33,957,920 1.1%
Agricultural 6,997,821 0.1% 2,856,000 0.1%
Vacant Land 104,269,046 1.8% 47,034,167 1.5%
Unsecured 17,201,305 0.3% 53,773,198 1.7%
Cross Reference (1) 25,035,165 0.4% 3,946,969 0.1%
Other 2,908,352 0.1% 1,483,679 0.0%
Total $5,677,301,791 100.0% $3,195,253,578 100.0%
______________________________________
Source: Municipal Advisor.
[Remainder of Page Intentionally Left Blank]
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Historical assessed value and gross Tax Increment Revenues for Project Area No. 1 based on the equalized
tax rolls and actual gross Tax Increment Revenues deposited to the Redevelopment Property Tax Trust Fund
are shown below.
TABLE NO. 2
PROJECT AREA NO. 1
HISTORICAL ASSESSED VALUATIONS AND GROSS TAX INCREMENT REVENUES
2016-17 2017-18 2018-19 2019-20 2020-21
Secured Assessed Value $4,977,966,406 $5,103,964,054 $5,278,711,343 $5,482,423,278 $5,660,100,486
Unsecured Assessed Value 34,377,191 28,437,371 22,748,622 36,027,567 17,201,305
Total Assessed Valuation (1) 5,012,343,597 5,132,401,425 5,301,459,965 5,518,450,845 5,677,301,791
Base Year Valuation (199,398,232) (199,398,233) (199,398,233) (199,398,233) (199,398,233)
Incremental Valuation $4,812,945,365 $4,933,003,192 $5,102,061,732 $5,319,052,612 $5,477,903,558
Basic Tax Rate/$100 1.00% 1.00% 1.00% 1.00% 1.00%
Tax Increment Revenues 48,129,454 49,330,032 51,020,617 53,190,526 54,779,036
Unitary Revenues 648,065 673,895 700,186 722,959 737,500 (2)
Gross Tax Increment Revenues $ 48,777,519 $ 50,003,927 $ 51,720,803 $ 53,913,485 $ 55,516,536
Actual RPTTF Deposit $ 49,210,774 $ 50,475,054 $ 51,956,505 $ 54,312,406 N/A
______________________________________
(1) Taxable Valuation as of August 20 equalized roll.
(2) Estimated.
Source: Riverside County Auditor-Controller.
Historical assessed value and gross Tax Increment Revenues for Project Area No. 2 based on the equalized
tax rolls and actual gross Tax Increment Revenues deposited to the Redevelopment Property Tax Trust Fund
are shown below.
TABLE NO. 3
PROJECT AREA NO. 2
HISTORICAL ASSESSED VALUATIONS AND GROSS TAX INCREMENT REVENUES
2016-17 2017-18 2018-19 2019-20 2020-21
Secured Assessed Value $2,777,740,583 $2,850,974,377 $2,959,127,650 $3,055,267,270 $3,141,480,380
Unsecured Assessed Value 58,960,131 60,680,434 56,673,732 56,542,535 53,773,198
Total Assessed Valuation (1) 2,836,700,714 2,911,654,811 3,015,801,382 3,111,809,805 3,195,253,578
Base Year Valuation (95,182,755) (95,182,755) (95,182,755) (95,182,755) (95,182,755)
Incremental Valuation $2,741,517,959 $2,816,472,056 $2,920,618,627 $3,016,627,050 $3,100,070,823
Basic Tax Rate/$100 1.00% 1.00% 1.00% 1.00% 1.00%
Tax Increment Revenues 27,415,180 28,164,721 29,206,186 30,166,271 31,000,708
Unitary Revenues 267,828 279,191 291,982 301,423 307,500 (2)
Gross Tax Increment Revenues $ 27,683,008 $ 28,443,912 $ 29,498,168 $ 30,467,694 $ 31,308,208
Actual RPTTF Deposit $ 28,205,847 $ 28,643,547 $ 29,637,091 $ 30,742,836 N/A
______________________________________
(1) Taxable Valuation as of August 20 equalized roll.
(2) Estimated.
Source: Riverside County Auditor-Controller.
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Actual gross deposits and deductions from the RPTTF for Project Area No. 1 are shown below:
TABLE NO. 4
PROJECT AREA NO. 1
REDEVELOPMENT PROPERTY TAX TRUST FUND DEPOSITS
2016-17 2017-18 2018-19 2019-20
Gross Deposit to RPTTF $49,210,774 $50,475,054 $51,956,505 $54,312,406
Senior Tax Sharing (1,137,449) (2,269,947) (2,420,239) (2,622,759)
Available for Debt Service 48,073,325 48,205,107 49,536,266 51,689,647
Subordinate Tax Sharing (1) (20,052,159) (21,511,706) (22,227,242) (23,270,556)
Net Deposit to RPTTF $28,021,166 $26,693,401 $27,309,024 $28,419,092
______________________________________
(1) Available if needed to pay debt service pursuant to Section 34183(b) of the Dissolution Act.
Source: Riverside County Auditor-Controller.
Actual gross deposits and deductions from the RPTTF for Project Area No. 2 are shown below:
TABLE NO. 5
PROJECT AREA NO. 2
REDEVELOPMENT PROPERTY TAX TRUST FUND DEPOSITS
2016-17 2017-18 2018-19 2019-20
Gross Deposit to RPTTF $28,205,847 $28,643,547 $29,637,091 $30,742,836
Senior Tax Sharing (19,009,829) (19,304,225) (19,973,303) (20,716,940)
Net Deposit to RPTTF $ 9,196,018 $ 9,339,322 $ 9,663,788 $10,025,897
______________________________________
Source: Riverside County Auditor-Controller.
TABLE NO. 6
REDEVELOPMENT PROPERTY TAX TRUST FUND DEPOSITS
2016-17 2017-18 2018-19 2019-20
January RPTTF Deposit
June RPTTF Deposit
Gross RPTTF Deposits
County Administrative Fees
Tax Sharing (1)
RPTTF Available
______________________________________
(1) Including Subordinated Pass-Through Amounts, which are subordinate to the Bonds and the 2016 Bonds, but
withheld by Auditor-Controller prior to distribution of RPTTF unless required to pay enforceable obligations.
Source: Riverside County Auditor-Controller.
[Remainder of Page Intentionally Left Blank]
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Major Taxpayers
The ten largest property taxpayers represent 6.1% of the 2020-21 total assessed value of Project Area No.
1 and 6.2% of the incremental assessed value of Project Area No. 1.
TABLE NO. 7
PROJECT AREA NO. 1
TEN LARGEST TAXPAYERS AS A PERCENT OF 2020-21 TOTAL ASSESSED VALUE
2020-21 % of Total Total Assessed Assessed
Taxpayer Value Value Land Use
BRE Iconic LQR LLC $163,077,289 2.9% Hotel
Silverhawk Apartments LP 26,077,707 0.5% Apartments
Palm Desert Lodging 24,312,125 0.4% Hotel
RREF II CWC LAQ 22,268,605 0.4% Residential
HJ GG Partners LLC 20,982,350 0.4% Residential
OTLQ LLC 20,039,994 0.4% Commercial
LQ Investment 17,024,220 0.3% Commercial
Tradition Golf Club 16,574,079 0.3% Country Club
Quarry at La Quinta Inc. 14,284,458 0.3% Hotel
Silverrock Phase I 12,346,106 0.2% Golf Course
$336,986,933 6.1%
______________________________________
Source: Municipal Advisor.
[Remainder of Page Intentionally Left Blank]
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The ten largest property taxpayers represent 9.3% of the 2020-21 total assessed value of Project Area No.
2 and 9.5% of the incremental assessed value of Project Area No. 2.
TABLE NO. 8
PROJECT AREA NO. 2
TEN LARGEST TAXPAYERS AS A PERCENT OF 2020-21 TOTAL ASSESSED VALUE
2020-21 % of Total Total Assessed Assessed
Taxpayer Value Value Land Use
Inland American La Quinta Pavilion $ 50,248,920 1.6% Commercial
Hawthorne IL Propco 45,760,953 1.4% Assisted Living
Walmart Real Estate Business Trust 32,199,420 1.0% Commercial
Health Care Reit Inc. 27,473,475 0.9% Commercial
Aventine Dev. 27,380,407 0.9% Apartments
Costco Wholesale Corporation 26,550,676 0.8% Commercial
CSRA Komar Desert Center St. 26,343,936 0.8% Commercial
RREF La Quinta REO 20,934,021 0.7% Commercial
TD Desert Development LP 19,700,507 0.6% Residential
Eagle Hardware and Garden Inc./Lowes 19,239,506 0.6% Commercial
$295,831,821 9.3%
______________________________________
Source: Municipal Advisor.
Assessment Appeals
Project Area No. 1
As of July 2020, there were a total 44 pending appeals filed by property owners in Project Area No. 1 as
shown below. The total value of property under appeal for all years is $73.1 million. Some appeals have
been filed for multiple years for the same property. A summary of all pending appeals is shown below.
Pending Value of Property % of
Tax Year Appeals Under Appeal Tax Roll
2016-17 1 $ 1,622,318 0.0%
2017-18 2 4,570,727 0.1%
2018-19 14 23,804,606 0.4%
2019-20 27 43,071,328 0.8%
Total 44 $73,068,979 N/A
______________________________________
Source: Municipal Advisor.
For Fiscal Years 2015-16 to 2018-19, 13 of 59 (22%) of resolved appeals were successful, with an average
reduction in assessed value of 35.7%. The Successor Agency cannot predict the outcome of any pending
appeals.
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Project Area No. 2
As of July 2020, there were a total 77 pending appeals filed by property owners in Project Area No. 2 as
shown below. The total value of property under appeal for all years is $344.8 million. Some appeals have
been filed for multiple years for the same property. A summary of all pending appeals is shown below.
Pending Value of Property % of
Tax Year Appeals Under Appeal Tax Roll
2016-17 13 $ 59,941,506 2.1%
2017-18 16 67,320,471 2.3%
2018-19 30 149,627,794 5.0%
2019-20 18 67,909,524 2.2%
Total 77 $344,799,295 N/A
______________________________________
Source: Municipal Advisor.
For Fiscal Years 2015-16 to 2018-19, 10 of 29 (34%) of resolved appeals were successful, with an average
reduction in assessed value of 47.9%. The Successor Agency cannot predict the outcome of any pending
appeals.
While the Successor Agency expects some decline in total assessed valuation as a result of pending or
potential future appeals, no prediction can be made as to the amount of the decline in total assessed
valuation, if any, within the Project Areas. No reduction for pending appeals in the Project Areas has been
incorporated in the projections. Reductions in revenue for refunds resulting from successful appeals or
current or prior year appeals have also not been incorporated into the projections. The success rate of
appeals, reductions granted and refunds may vary from historical averages.
See “APPENDIX B - MUNICIPAL ADVISOR’S PROJECTED TAX REVENUES REPORT.”
Tax Collections
The County has adopted the “Teeter Plan” method of distributing property taxes to taxing agencies,
including redevelopment agencies. Under this method, the Successor Agency receives 100% of its tax
increment without regard to delinquencies.
Under the statute creating the Teeter Plan, the Board of Supervisors of the County could under certain
circumstances terminate the Teeter Plan in its entirety or terminate the Teeter Plan as to the Successor
Agency.
FINANCIAL INFORMATION
Successor Agency Accounting Records and Financial Statements
The activities of the Successor Agency are reported as a fiduciary trust fund as part of the City’s basic
financial statements. The Successor Agency does not prepare separate financial statements.
The City’s financial statements for the Fiscal Year ended June 30, 2020, attached hereto as “APPENDIX D”
have been audited by Eide Bailly LLP, Riverside, California (the “Auditor”). The City’s audited financial
statements are public documents and are included within this Official Statement without the prior approval
of the Auditor. The Auditor has not been engaged to perform, and has not performed, since the date of its
report included herein, any procedures on the financial statements addressed in that report. The Auditor
also has not performed any procedures relating to this Official Statement.
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Property Taxation in California
Manner in Which Property Valuations and Assessments are Determined (Article XIIIA). On June 6,
1978, California voters approved an amendment (commonly known as both Proposition 13 and the Jarvis-
Gann Initiative) to the State Constitution which imposes certain limitations on taxes that may be levied
against real property. This amendment, which added Article XIIIA to the State Constitution, among other
things, defines full cash value of property to mean “the county assessor’s valuation of real property as
shown on the 1975-76 tax bill under ‘full cash value,’ or, thereafter, the appraised value of real property
when purchased, newly constructed, or a change in ownership has occurred after the 1975 assessment.”
This full cash value may be adjusted annually to reflect inflation at a rate not to exceed 2% per year, or any
reduction in the consumer price index or comparable local data, or any reduction in the event of declining
property value caused by substantial damage, destruction or other factors. The amendment further limits
the amount of any ad valorem tax on real property to 1% of the full cash value of that property, except that
additional taxes may be levied to pay debt service on indebtedness approved by the voters prior to July 1,
1978 and on any bonded indebtedness for the acquisition or improvement of real property which is approved
after July 1, 1978 by two-thirds of the votes cast by voters voting on such indebtedness. However, pursuant
to an amendment to the State Constitution, redevelopment agencies were prohibited from receiving any of
the tax increment revenue attributable to tax rates levied to finance bonds approved by the voters on or after
January 1, 1989 for the acquisition or improvement of real property. Moreover, Section 34183 of the
Dissolution Act effectively eliminates the January 1, 1989 date from such prohibitions and SB 107 further
states that pre-1989 tax override rates are no longer distributed to successor agencies except in limited
circumstances (see “SECURITY FOR THE BONDS - Pledged Tax Revenues,” and “- Property Tax Rate”
below and “RISK FACTORS - Factors Which May Affect Pledged Tax Revenues - Reduction in Inflationary
Rate”).
In the general election held November 4, 1986, voters in the State approved two measures, Propositions 58
and 60, which further amend the terms “purchase” and “change of ownership,” for purposes of determining
full cash value of property under Article XIIIA, to not include the purchase or transfer of (1) real property
between spouses and (2) the principal residence and the first $1,000,000 of other property between parents
and children. Proposition 60 amends Article XIIIA to permit the Legislature to allow persons over age 55
who sell their residence and buy or build another of equal or lesser value within two years in the same
county (or in certain cases, another county), to transfer the old residence’s assessed value to the new
residence.
Proposition 8 Adjustments. Proposition 8, approved in 1978, provides for the assessment of real property
at the lesser of its originally determined (base year) full cash value compounded annually by the inflation
factor, or its full cash value as of the lien date, taking into account reductions in value due to damage,
destruction, obsolescence or other factors causing a decline in market value. Reductions based on
Proposition 8 do not establish new base year values, and the property may be reassessed as of the following
lien date up to the lower of the then-current fair market value or the factored base year value. The State
Board of Equalization has approved this reassessment formula and such formula has been used by county
assessors statewide, and such methodology has been upheld by the California courts. During the last
recession, the Prior Agency saw a reduction in property values of approximately __% between 2008-09 and
2011-12, which the Successor Agency attributes to Proposition 8 reductions.
As a result of the Governor of the State’s (“Governor”) declaration of a State of Emergency to exist in
California as a result of the threat of the COVID-19 virus, the County could process future Proposition 8
reductions due to the economic impact of COVID-19 on property value. See “RISK FACTORS - COVID-
19.” Neither the Successor Agency nor the Municipal Advisor is able to estimate the potential impact on
future property values or tax increment revenues.
Unsecured and Secured Property. In California, property which is subject to ad valorem taxes is
classified as “secured” or “unsecured.” The secured classification includes property on which any property
tax levied by a county becomes a lien on that property. A tax levied on unsecured property does not become
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a lien against the taxed unsecured property, but may become a lien on certain other property owned by the
taxpayer. Every tax which becomes a lien on secured property, arising pursuant to State law, has priority
over all other liens on the secured property, regardless of the time of the creation of the other liens.
Property in the Project Areas is assessed by the Riverside County Assessor except for public utility property
which is assessed by the State Board of Equalization.
The valuation of secured property is determined as of January 1 each year for taxes owed with respect to
the succeeding fiscal year. The tax rate is equalized during the following September of each year, at which
time the tax rate is determined. Secured and unsecured property is entered on separate parts of the
assessment roll maintained by the county assessor. The method of collecting delinquent taxes is
substantially different for the two classifications of property.
Property taxes on the secured roll are due in two installments, on November 1 and February 1 of the fiscal
year. If unpaid, such taxes become delinquent on December 10 and April 10, respectively, and a 10%
penalty attaches to any delinquent payment in addition to a $20 cost on the second installment. On July 1
of each fiscal year any property which is delinquent will become defaulted. Such property may thereafter
be redeemed by payment of the delinquent taxes and the delinquency penalty, plus a redemption penalty of
l½% per month to the time of redemption, together with any other charges permitted by law. If taxes are
unpaid for a period of five years or more, the property is subject to sale by the County Tax Collector. The
exclusive means of enforcing the payment of delinquent taxes with respect to property on the secured roll
is the sale of the property securing the taxes for the amount of taxes which are delinquent.
Property taxes on the unsecured roll become delinquent, if unpaid on August 31. A 10% penalty attaches
to delinquent taxes on property on the unsecured roll, and an additional penalty of l½% per month begins
to accrue on November 1 of the fiscal year. The County has four ways of collecting delinquent unsecured
personal property taxes: (1) a civil action against the taxpayer; (2) filing a certificate in the office of the
County Clerk specifying certain facts in order to obtain a judgment lien on certain property of the taxpayer;
(3) filing a certificate of delinquency for record in the County Recorder’s Office, in order to obtain a lien
on certain property of the taxpayer; and (4) seizure and sale of personal property, improvements or
possessory interests belonging or assessed to the assessee.
After the Governor’s declaration of a State of Emergency to exist in California as a result of the threat of
COVID-19 Pandemic (the “Pandemic”), the Riverside County Treasurer-Tax Collector stated his office’s
intent to accommodate those who have been directly impacted by the Pandemic and who are unable to pay
property taxes timely due to circumstances related to this crisis. The Treasurer-Tax Collector does not have
the authority to extend the payment delinquency date (including the payment date of April 10, 2020) and
all payments received after the due date are assessed late penalties and costs as required by law. However,
taxpayers were permitted to submit to the Treasurer-Tax Collector a Penalty Cancellation Request Form
and documentation to support the cancellation of penalties as allowed in limited circumstances under the
then-current State law, allowing for waiver of penalties, costs and other charges when failure to make a
timely payment is due to reasonable cause and circumstances beyond the taxpayer’s control, and occurred
notwithstanding the exercise of ordinary care in the absence of willful neglect. The request for penalty
waiver was only applicable to taxes with delinquent dates beginning April 11, 2020 and was required to be
filed by June 30, 2020, with certain taxpayers having until May 6, 2021.
The Governor’s Executive Order N-61-20 extended the penalty and interest waiver through May 2021.
Although the Successor Agency received all of the RPTTF authorized to be paid to it on June 1, 2020 and
January 4, 2021, future property taxes to the Successor Agency could be impacted by both the economic
impact of COVID-19 on property value and on the timely collection of property tax. The value of property
on the Fiscal Year 2021-22 tax roll and future tax rolls, could be reduced. The initial impact could occur
because the April 2020, December 2020 and April 2021 property tax installments could be deferred by some
taxpayers, or some taxpayers may be unable to make their property tax payments going forward.
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Neither the Successor Agency nor the Municipal Advisor is able to estimate the potential impact on future
property collections, values or tax increment revenues as a result of the Pandemic or the County’s current
or potential future waiver of property tax delinquent penalties resulting in some taxpayers deferring their
payment.
Supplemental Assessments. Legislation adopted in 1984 (Section 75, et seq. of the Revenue and Taxation
Code of the State of California) provides for the supplemental assessment and taxation of property at its
full cash value as of the date of a change of ownership or the date of completion of new construction (the
“Supplemental Assessments”). To determine the amount of the Supplemental Assessments the County
Auditor applies the current year’s tax rate to the supplemental assessment roll and computes the amount of
taxes that would be due for the full year. The taxes due are then adjusted by a proration factor to reflect the
portion of the tax year remaining as determined by the date on which the change in ownership occurred or
the new construction was completed. Supplemental Assessments become a lien against the real property
on the date of the change of ownership or completion of new construction.
Unitary Property. Commencing in the 1988-89 Fiscal Year, the Revenue and Taxation Code of the State
of California changed the method of allocating property tax revenues derived from state assessed utility
properties. It provides for the distribution of state assessed values to tax rate areas by a county-wide
mathematical formula rather than assignment of state assessed value according to the location of those
values in individual tax rate areas.
Commencing with the 1988-89 Fiscal Year, each county has established one county-wide tax rate area. The
assessed value of all unitary property in the county has been assigned to this tax rate area and one tax rate
is levied against all such property (“Unitary Revenues”).
The property tax revenue derived from the assessed value assigned to the county-wide tax rate area shall be
allocated as follows: (1) each jurisdiction will be allocated up to 2% of the increase in Unitary Revenues
on a pro rata basis county-wide; and (2) any decrease in Unitary Revenues or increases less than 2%, or any
increase in Unitary Revenues above 2% will be allocated among jurisdictions in the same proportion of
each jurisdiction’s Unitary Revenues received in the prior year to the total Unitary Revenues county-wide.
The Unitary Revenues allocated to the Project Areas in Fiscal Year 2019-20 are $1,024,382.
Legislation adopted in 2006 (SB 1317, Chapter 872) provides that, commencing with Fiscal Year 2007-08,
certain property related to new electrical facilities shall be allocated entirely to the county in which such
property is located and property tax revenues derived from such property shall be allocated to such county
and certain Taxing Agencies within such county.
Property Tax Rate. The difference between the $1.00 general tax levy provided under Article XIIIA tax
rate and those actually levied (referred to as the “tax override rate”) represents the tax levied by overlapping
entities to pay debt service on bonded indebtedness approved by the voters.
Section 34183 of the Dissolution Act effectively eliminated the tax override rate from the calculation of tax
increment revenues with respect to tax override rates authorized by voters for the purpose of repaying
bonded indebtedness for the acquisition or improvement of real property. Future Tax Increment Revenues
have been projected by applying a tax rate of $1.00 per $100 of taxable value general levy to incremental
taxable values.
Administrative Costs. In 1990, the Legislature enacted SB 2557 (Chapter 466, Statutes of 1990) which
allows counties to charge for the cost of assessing, collecting and allocating property tax revenues to local
government jurisdictions on a prorated basis. SB 1559 (Chapter 697, Statutes of 1992) explicitly includes
redevelopment agencies among the jurisdictions which are subject to such charges. In addition, Sections
34182(e) and 34183(a) of the Dissolution Act allow administrative costs of the County Auditor-Controller
for the cost of administering the provisions of the Dissolution Act, as well as the foregoing SB 1559
amounts, to be deducted from property tax revenues before moneys are deposited into the Redevelopment
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Property Tax Trust Fund. For Fiscal Year 2019-20, the County administrative fees charged to the Project
Areas including administration of the Redevelopment Property Tax Trust Fund were $798,236. In total, the
fees represent approximately 0.94% of gross deposits to the Redevelopment Property Tax Trust Fund.
Tax Sharing Agreements and Tax Sharing Statutes
Tax Sharing Agreements
Pursuant to prior Section 33401(b) of the Redevelopment Law, a redevelopment agency was authorized to
enter into an agreement to pay tax increment revenues to any taxing agency that has territory located within
a redevelopment project to alleviate any financial burden or detriment caused by the redevelopment project.
These agreements are commonly referred to as “tax sharing agreements” or “pass-through agreements.”
The tax sharing agreements (“Contractual Tax Sharing Agreements”) entered into with respect to each
Project Area are described in “APPENDIX B - MUNICIPAL ADVISOR’S PROJECTED TAX REVENUES
REPORT.”
Since dissolution, the County Auditor-Controller calculates and pays the Contractual Tax Sharing
Agreement amounts. These amounts are deducted from tax increment revenue deposited in the
Redevelopment Property Tax Trust Fund.
Tax Sharing Statutes
Certain provisions were added to the Redevelopment Law by the adoption of AB 1290 in 1994. If new
territory was added to a redevelopment project, under Section 33607.5 of the Redevelopment Law, any
affected taxing entity would share in the tax increment revenues generated by such added area pursuant to
a statutory formula (“Statutory Tax Sharing”).
In addition, pursuant to Section 33333.6(e)(2) of the Redevelopment Law, if the Prior Agency deleted the
time limit to incur indebtedness in a redevelopment project (as amended pursuant to SB 211) or increased
the total amount of tax increment revenues to be allocated to the project area or increased the duration of
the redevelopment plan and the period for receipt of tax increment revenues, Statutory Tax Sharing is
required under Section 33607.7 of the Redevelopment Law with all affected taxing entities not already a
party to a tax sharing agreement, once the original limitations have been reached.
The Dissolution Act provides for a procedure by which the Successor Agency may make Statutory Tax
Sharing amounts subordinate to the Bonds. The Successor Agency will not undertake such procedure to
subordinate such payments with respect to the Bonds.
The Statutory Tax Sharing calculations with respect to each Project Area are described in “APPENDIX B -
MUNICIPAL ADVISOR’S PROJECTED TAX REVENUES REPORT.” Since dissolution, the County Auditor-
Controller calculates and pays the Statutory Tax Sharing amounts. These amounts are deducted from tax
increment revenue deposited in the Redevelopment Property Tax Trust Fund.
Outstanding Indebtedness and Enforceable Obligations
The Successor Agency issued the 2016 Parity Bonds in the principal amount of $35,055,000. The 2016
Parity Bonds are outstanding as of January 1, 2021 in the principal amount of $29,380,000 and mature
September 1, 2039. Payment of the 2016 Parity Bonds is on a parity with the Bonds.
The only other enforceable obligations that have been approved for payment on the Last and Final ROPS
are repayment of a City advance to the Successor Agency, bond administration fees and a minor amount of
administrative costs. Payment of such amounts is subordinate to the Bonds and the 2016 Parity Bonds.
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Projected Pledged Tax Revenues
Receipt of projected Pledged Tax Revenues shown in Table No. 9 in the amounts and at the times projected
depends on the realization of certain assumptions relating to the Tax Increment Revenues. The Municipal
Advisor has projected taxable valuation and Pledged Tax Revenues in the Project Areas. The Successor
Agency believes the assumptions set forth in “APPENDIX B - MUNICIPAL ADVISOR’S PROJECTED TAX
REVENUES REPORT” upon which the projections are based are reasonable; however, some assumptions
may not materialize and unanticipated events and circumstances may occur (see “RISK FACTORS”).
Therefore, the actual Pledged Tax Revenues received during the forecast period may vary from the
projections and the variations may be material, affecting the Successor Agency’s ability to timely pay
principal of and interest on the Bonds.
TABLE NO. 9
PROJECTED PLEDGED TAX REVENUES
(in $’000’s)
Project No. 1 Project No. 2 Available Project No. 1 Pledged
Fiscal Net RPTTF Net RPTTF Tax Subordinate Tax
Year Deposit (1) Deposit Revenues Pass-Through (2) Revenues
2021 $28,244 $ 9,875 $38,119 $23,703 $61,822
2022 28,789 10,067 38,856 24,186 63,042
2023 29,343 10,263 39,606 24,679 64,285
2024 29,909 10,395 40,304 25,182 65,486
2025 30,484 10,589 41,073 25,695 66,768
2026 31,074 10,789 41,863 26,218 68,081
2027 31,673 10,991 42,664 26,752 69,416
2028 32,286 11,197 43,483 27,295 70,778
2029 32,911 11,409 44,320 27,851 72,171
2030 33,545 11,626 45,171 28,419 73,590
2031 34,197 11,845 46,042 28,995 75,037
2032 34,860 12,069 46,929 29,584 76,513
2033 35,533 12,295 47,828 30,186 78,014
2034 36,225 12,528 48,753 30,797 79,550
___________________________________
(1) After deductions for Subordinated Pass-Through Amounts.
(2) Available if needed to pay debt service pursuant to Section 34183(b) of the Dissolution Act.
Source: Municipal Advisor.
The projected Pledged Tax Revenues shown above are subject to several variables described herein. See
“RISK FACTORS” herein. The Successor Agency provides no assurance that the projected Pledged Tax
Revenues will be achieved. Neither the Successor Agency nor the Municipal Advisor is able to estimate
the potential impact of COVID-19 on future property values or tax increment revenues.
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Debt Service Coverage
Set forth below is the estimated debt service coverage of the Bonds and the 2016 Parity Bonds using Pledged
Tax Revenues shown in Table No. 9.
TABLE NO. 10
DEBT SERVICE COVERAGE
(in $’000’s)
Fiscal Pledged Tax 2016 2021 Coverage
Year Revenues (1) Bonds Bonds* Total* Ratio
2021 $61,822 $2,471 $11,175 $13,646 4.53x
2022 63,042 2,462 14,338 16,800 3.75x
2023 64,285 2,463 14,334 16,797 3.83x
2024 65,486 2,462 14,335 16,797 3.90x
2025 66,768 2,463 14,332 16,795 3.98x
2026 68,081 2,466 14,329 16,795 4.05x
2027 69,416 2,466 14,337 16,803 4.13x
2028 70,778 2,457 14,333 16,790 4.22x
2029 72,171 2,463 14,325 16,788 4.30x
2030 73,590 2,470 14,330 16,800 4.38x
2031 75,037 2,467 14,335 16,802 4.47x
2032 76,513 2,462 14,336 16,798 4.55x
2033 78,014 2,467 5,116 7,583 10.29x
2034 79,550 2,888 5,104 7,992 9.95x
___________________________________
(1) Includes amounts payable under Subordinated Pass-Through Amounts which would be available if
needed to pay debt service pursuant to Section 34183(b) of the Dissolution Act.
Source: Hilltop Securities and Municipal Advisor.
* Preliminary, subject to change.
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RISK FACTORS
The purchase of the Bonds involves investment risk. If a risk factor materializes to a sufficient degree, it
could delay or prevent payment of principal of and/or interest on the Bonds. Such risk factors include, but
are not limited to, the following matters and should be considered, along with other information in this
Official Statement, by potential investors.
Factors Which May Affect Pledged Tax Revenues
The ability of the Successor Agency to pay principal of and interest on the Bonds depends on the timely
receipt of Pledged Tax Revenues as projected herein (see “FINANCIAL INFORMATION - Projected Pledged
Tax Revenues” herein). Projections of Pledged Tax Revenues are based on the underlying assumptions
relating to Tax Increment Revenues of the Project Areas. Pledged Tax Revenues allocated to the Successor
Agency (which constitute the ultimate source of payment of principal of and interest on the Bonds, as
discussed herein) are determined by the amount of incremental valuation of taxable property in the Project
Areas, taxed at a rate of $1.00 per $100 of assessed value (1%) and the percentage of taxes collected in the
Project Areas, adjusted to reflect prior claims on the Tax Increment Revenues. A number of factors which
may affect Tax Increment Revenues, and consequently, Pledged Tax Revenues, are outlined below.
Reductions in Assessed Value. Tax Increment Revenues allocated to the Redevelopment Property Tax
Trust Fund are determined by the amount of incremental taxable value in the Project Areas taxed at a rate
of $1.00 per $100 of assessed value (1%). The reduction of taxable values of property in the Project Areas
caused by economic factors beyond the Successor Agency’s control, such as relocation out of the Project
Areas by one or more major property owners, sale of property to a non-profit corporation exempt from
property taxation, or the complete or partial destruction of such property caused by, among other
eventualities, earthquake or other natural disaster, could cause a reduction in the Pledged Tax Revenues that
provide for the repayment of and secure the Bonds. Such reduction of Pledged Tax Revenues could have
an adverse effect on the Successor Agency’s ability to make timely payments of principal of and interest on
the Bonds.
Article XIIIA. Pursuant to the California voter initiative process, on June 6, 1978, California voters
approved Proposition 13 which added Article XIIIA to the California Constitution. This amendment
imposed certain limitations on taxes that may be levied against real property to 1% of the full cash value of
the property, adjusted annually for inflation at a rate not exceeding 2% annually. Full cash value is
determined as of the 1975-76 assessment year, upon change in ownership (acquisition) or when newly
constructed (see “FINANCIAL INFORMATION - Property Taxation in California” herein for a more
complete discussion of Article XIIIA). Article XIIIA has subsequently been amended to permit reduction
of the “full cash value” base in the event of declining property values caused by substantial damage,
destruction or other factors, and to provide that there would be no increase in the “full cash value” base in
the event of reconstruction of property damaged or destroyed in a disaster and in other special
circumstances.
Reduction in Inflationary Rate. The annual inflationary adjustment, while limited to 2%, is determined
annually and may not exceed the percentage change in the California Consumer Price Index (CCPI).
Because the Revenue and Taxation Code does not distinguish between positive and negative changes in the
CCPI used for purposes of the inflation factor, there was a decrease of 0.237% in 2009-10 – applied to the
2010-11 tax roll – reflecting the actual change in the CCPI, as reported by the State Department of Finance.
For each fiscal year since Article XIIIA has become effective (the 1978-79 Fiscal Year), the annual increase
for inflation has been at least 2% except in ten fiscal years as shown below:
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Tax Roll Percentage Tax Roll Percentage
1981-82 1.000% 2010-11 (0.237)%
1995-96 1.190% 2011-12 0.753%
1996-97 1.110% 2014-15 0.454%
1998-99 1.853% 2015-16 1.998%
2004-05 1.867% 2016-17 1.525%
It is possible that as a result of the economic impact of the Pandemic, the CCPI may not exceed 2% in the
next several years.
Proposition 8 Adjustments. Proposition 8, approved in 1978, provides for the assessment of real property
at the lesser of its originally determined (base year) full cash value compounded annually by the inflation
factor, or its full cash value as of the lien date, taking into account reductions in value due to damage,
destruction, obsolescence or other factors causing a decline in market value. Reductions based on
Proposition 8 do not establish new base year values, and the property may be reassessed as of the following
lien date up to the lower of the then-current fair market value or the factored base year value. The State
Board of Equalization has approved this reassessment formula and such formula has been used by county
assessors statewide. This methodology has been approved by the Fourth District Court of Appeals in a case
in which the California Supreme Court declined further review. See “FINANCIAL INFORMATION -
Property Taxation in California - Proposition 8 Adjustments” herein.
If Proposition 8 adjustments are made by the County Assessor in future years because of declines in the fair
market value of properties caused by the lack of real estate development in the area generally or other
economic factors, Pledged Tax Revenues may be adversely affected and as a possible consequence may
have an adverse effect on the Successor Agency’s ability to pay debt service on the Bonds.
As a result of the Pandemic, the County could process future Proposition 8 reductions due to the economic
impact of COVID-19 on property value. If Proposition 8 adjustments are made by the County Assessor in
future years because of declines in the fair market value of properties caused by the lack of real estate
development in the area generally or other economic factors, Pledged Tax Revenues may be adversely
affected and as a possible consequence may have an adverse effect on the Successor Agency’s ability to
pay debt service on the Bonds.
Assessment Appeals. Assessment appeals may be filed by property owners seeking a reduction in the
assessed value of their property. After the property owner files an appeal, the County’s Appeals Board will
hear the appeal and make a determination as to whether or not there should be a reduction in assessed value
for a particular property and the amount of the reduction, if any. To the extent that any reductions are made
to the assessed valuation of such properties with appeals currently pending, or appeals subsequently filed,
Tax Increment Revenues, and correspondingly, Pledged Tax Revenues will be reduced. Such reductions
may have an adverse effect on the Successor Agency’s ability to pay debt service on the Bonds. As of April
2020, there were 44 pending appeals within the Project Area No. 1 relating to $73.1 million of 2019-20 or
prior years’ assessed value and 77 pending appeals within the Project Area No. 2 relating to $344.8 million
of 2019-20 or prior years’ assessed value. As a result of the Pandemic and the impact of COVID-19 on the
economy and property value, the Successor Agency may experience a rise in the number of assessment
appeals. See “THE PROJECT AREAS - Assessment Appeals” herein. To the extent these appeals are
resolved in favor of any property owner, Pledged Tax Revenues will be reduced.
Natural Hazards. Any natural disaster or other physical calamity, including earthquake, may have the
effect of reducing Pledged Tax Revenues through reduction in the aggregate assessed valuation within the
boundaries of the Project Areas.
The City, like most communities in California, is an area of unpredictable seismic activity, and therefore,
is subject to potentially destructive earthquakes. Numerous active and inactive fault lines pass through or
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near the City. The occurrence of severe seismic activity in the City could result in substantial damage to
property located in the Project Areas, and could lead to successful appeals for reduction in assessed values
of such property. Such a reduction could result in a decrease in Pledged Tax Revenues.
Approximately 0.4% of the Project Areas are located in a 100-Year Flood Plain. Additionally, significant
localized flooding events have occurred affecting a limited number of properties in the Project Areas. The
Successor Agency cannot guarantee that flooding events in future years, if any, will not impact the value
of properties within the Project Areas.
The occurrence of one or more natural disasters could occur and could result in damage to improvements
and property within the Project Areas of varying seriousness. Such damage may significantly reduce
Pledged Tax Revenues received by the Successor Agency and may adversely impact the Successor
Agency’s ability to pay debt service on the Bonds.
Hazardous Substances. An additional environmental condition that may result in the reduction in the
assessed value of parcels would be the discovery of a hazardous substance that would limit the beneficial
use of a property within the Project Areas. In general, the owners and operators of a property may be
required by law to remedy conditions of the property relating to releases or threatened releases of hazardous
substances. The owner (or operator) may be required to remedy a hazardous substance condition of
property whether or not the owner (or operator) has anything to do with creating or handling the hazardous
substance. The effect, therefore, should any of the property within the Project Areas be affected by a
hazardous substance would be to reduce the marketability and value of the property, perhaps by an amount
in excess of the costs of remedying the condition. The Successor Agency can give no assurance that future
development will not be limited by these conditions.
Certain Bankruptcy Risks. The enforceability of the rights and remedies of the Owners of the Bonds and
the obligations of the Successor Agency may become subject to the following: the federal bankruptcy code
and applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or affecting
the enforcement of creditors’ rights generally, now or hereafter in effect; usual equitable principles which
may limit the specific enforcement under state law of certain remedies; the exercise by the United States of
America of the powers delegated to it by the federal Constitution; and the reasonable and necessary
exercise, in certain exceptional situations, of the police power inherent in the sovereignty of the State of
California and its governmental bodies in the interest of servicing a significant and legitimate public
purpose. Bankruptcy proceedings, or the exercise of powers by the federal or state government, if initiated,
could subject the Owners of the Bonds to judicial discretion and interpretation of their rights in bankruptcy
or otherwise and consequently may entail risks of delay, limitation, or modification of their rights.
Levy and Collection of Taxes. The Successor Agency has no power to levy and collect property taxes,
and any property tax limitation, legislative measure, voter initiative or provision of additional sources of
income to Taxing Agencies having the effect of reducing the property tax rate must necessarily reduce the
amount of Tax Increment Revenues, and consequently, Pledged Tax Revenues that would otherwise be
available to pay the principal of, and interest on the Bonds.
After the Governor’s declaration of a State of Emergency to exist in California as a result of the threat of
COVID-19, the Riverside County Treasurer-Tax Collector stated his office’s intent to accommodate those
who have been directly impacted by the Pandemic and who are unable to pay property taxes timely due to
circumstances related to this crisis. The Treasurer-Tax Collector does not have the authority to extend the
payment delinquency date (including the payment date of April 10, 2020) and all payments received after
the due date are assessed late penalties and costs as required by law. However, taxpayers are permitted to
submit to the Treasurer-Tax Collector a Penalty Cancellation Request Form and documentation to support
the cancellation of penalties as allowed in limited circumstances under the then-current State law, allowing
for waiver of penalties, costs and other charges when failure to make a timely payment is due to reasonable
cause and circumstances beyond the taxpayer’s control, and occurred notwithstanding the exercise of
ordinary care in the absence of willful neglect. The request for penalty waiver was only applicable to taxes
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with delinquent dates beginning April 11, 2020 and was required to be filed by June 30, 2020, with certain
taxpayers having until May 6, 2021.
The Governor’s Executive Order N-61-20 extended the penalty and interest waiver through May 2021.
Although the Successor Agency received all of the RPTTF authorized to be paid to it on June 1, 2020 and
January 4, 2021, future property taxes to the Successor Agency could be impacted by both the economic
impact of COVID-19 on property value and on the timely collection of property tax. The value of property
on the Fiscal Year 2021-22 tax roll and future tax rolls could be reduced. The initial impact could occur
because the April 2020, December 2020 and April 2021 property tax installments could be deferred by some
taxpayers, or some taxpayers may be unable to make their property tax payments going forward. Neither
the Successor Agency nor the Municipal Advisor is able to estimate the potential impact on future property
collections, values or tax increment revenues as a result of the Pandemic or the County’s current or potential
future waiver of property tax delinquent penalties resulting in some taxpayers deferring their payment.
Interpretation of and Future Changes in the Law; Voter Initiatives. The Redevelopment Law and the
Dissolution Act are complex bodies of law and their application to the Successor Agency, the
Redevelopment Plan and the Project Areas may be subject to different interpretations by the Successor
Agency, the Department of Finance, the County Auditor-Controller, Taxing Agencies and other interested
parties, including with respect to Contractual Tax Sharing Agreements and Statutory Tax Sharing
obligations and enforceable obligations. Since the effectiveness of the Dissolution Act, the State
Department of Finance and various successor agencies have from time to time disagreed about the
interpretation of different language contained in the Dissolution Act, as well as whether or not the State
Department of Finance has exceeded its authority in rejecting items from Recognized Obligation Payment
Schedules submitted by successor agencies, as evidenced by numerous lawsuits. While the Successor
Agency has covenanted in the Indenture to preserve and protect the security of the Bonds and the rights of
the Bondholders (see “APPENDIX A - SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE - Other
Covenants of the Successor Agency”), any such action taken by the Successor Agency could incur
substantial time and cost that may have a detrimental effect on the Successor Agency’s ability to timely pay
debt service on the Bonds. Moreover, the Successor Agency cannot guarantee the outcome of any such
action taken by the Successor Agency to preserve and protect the security of the Bonds and the rights of the
Bondholders.
In addition to the existing limitations on Tax Increment Revenues described in this Official Statement under
“FINANCIAL INFORMATION - Property Taxation in California,” the California electorate or Legislature
could adopt future limitations with the effect of reducing Tax Increment Revenues payable to the Successor
Agency.
Real Estate and General Economic Risks
Tax Increment Revenues as presented herein as available for payment of any indebtedness of the Successor
Agency are based upon the latest actual assessed values for the 2020-21 Fiscal Year. Redevelopment of
real property within the Project Areas by the City, as well as private development in the Project Areas, may
be adversely affected by changes in general economic conditions, fluctuations in the real estate markets and
interest rates, unexpected increases in development costs, changes in or new governmental policies
including governmental policies to restrict or control certain kinds of development and by other similar
factors. If development and redevelopment activities in the Project Areas encounters significant obstacles
of the kind described herein or other impediments, the economy of the area in and around the Project Areas
could be adversely affected, causing reduced taxable valuation of property in the Project Areas a reduction
of the Tax Increment Revenues and a consequent reduction in Pledged Tax Revenues available to repay the
Bonds. Due to the future decline in the general economy of the region, owners of property within the
Project Areas may be less able or less willing to make timely payments of property taxes, causing a delay
or reduction of Tax Increment Revenues and consequently a reduction in Pledged Tax Revenues available
to repay the Bonds.
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COVID-19
The outbreak of COVID-19, a respiratory disease caused by a new strain of coronavirus, has been
characterized as a Pandemic by the World Health Organization. On January 31, 2020, the Secretary of the
United States Health and Human Services Department declared a public health emergency for the United
States and on March 13, 2020, the President of the United States declared the outbreak of COVID-19 in the
United States a national emergency. Subsequently, the President’s Coronavirus Guidelines for America and
the United States Centers for Disease Control and Prevention called upon Americans to take actions to slow
the spread of COVID-19 in the United States.
On March 4, 2020, the Governor proclaimed a state of emergency in California as a result of the threat of
COVID-19. Under the California Emergency Services Act, during a state of emergency, the Governor has
authority over all agencies of the state government and can exercise the State’s police powers. His powers
also include the power to promulgate, issue, and enforce orders and regulations as he deems necessary.
Since declaring the emergency, the Governor has issued a number of executive orders relating to COVID-
19 preparedness and mitigation. These include his March 19, 2020 Executive Order N-33-20, which
ordered all individuals living in the State of California to stay home or at their place of residence except as
needed to maintain continuity of operations of certain critical infrastructure sectors, as described in that
order and later designations. The County had issued a similar order (“County Order”) effective for its
residents on March 18, 2020. Since that time, gradual reopening first of lower-risk workplaces, public
spaces and then other businesses was permitted. However, from time to time, the Governor has directed
certain counties, including Riverside County, to roll back the opening of some of the businesses permitted
to open in June 2020. This is likely to continue as the cases of COVID-19 escalate in the near term, or in
the future. The State is monitoring closely the confirmed cases and deaths by county in making its decisions
on business and school openings and closings.
The City has held, and expects to continue to hold, meetings of its City Council substantially unhindered
by the Pandemic. As permitted under Executive Order N-33-20, certain of the City’s employees may
continue to come to work under designated exceptions for critical sectors and some of the City’s employees
are teleworking. The City’s business operations were not materially curtailed by employee absences
prompted by the stay-home order.
The Pandemic has negatively affected travel, commerce, investment values, and financial markets globally,
and is widely expected to continue to negatively affect economic output worldwide and within the City.
While federal and state governments (including California) have enacted legislation and taken executive
actions seeking to mitigate the negative public health and economic impacts of the Pandemic, the Successor
Agency offers no assurances that these interventions will have the intended effects.
The City continues to monitor the spread of COVID-19 and is working with local, state, and national
agencies to address the potential impact of the Pandemic upon the City. While the overall potential impact
of the Pandemic on the City cannot be fully quantified at this time, the continued outbreak of COVID-19
could lead to additional or modified public health restrictions and have an adverse effect on the financial
condition of property owners in the Project Areas and their ability to pay property taxes or the value of
property in the Project Areas resulting in a reduction in assessed value, and the effect could be material.
Prospective investors should assume that the current disruption to the national and global economies could
increase over the near term if further outbreaks occur and recovery may be prolonged. Therefore, the
associated impacts related to COVID-19 on the tax increment revenues could be materially adverse.
Furthermore, it is possible that there may be other outbreaks similar to COVID-19 in the future.
Recently, legislations have been introduced in order to assist various affected people and companies as a
result of the COVID-19 Pandemic. For example, Senate Bill 939 would allow under certain circumstances
a commercial tenant that is a small business or is an eating or drinking establishment, place of entertainment,
or performance venue that meets specified financial criteria, including experiencing a specified decline in
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revenue after a Shelter-in-Place order took effect, to terminate a lease without any liability for future rent,
fees, or costs that otherwise may have been due under the lease. Also, Senate Bill 1431 would expand the
provisions allowing for reassessment of property. Under existing law, property may be reassessed for
damage or destruction caused by one of 3 specified occurrences, including a major misfortune or calamity
in an area or region subsequently proclaimed by the Governor to be in a state of disaster if the property was
damaged or destroyed by the misfortune or calamity that caused the Governor to proclaim the region to be
in a state of disaster. Senate Bill 1431 would specify that “damage” includes diminution in the value of
property as a result of any law, order, rule, or regulation of the state or any city, county, or other political
subdivisions providing tenant protections in response to the COVID-19 Pandemic and would also specify
that the term “major misfortune or calamity” includes the COVID-19 Pandemic.
Further, the Governor’s Executive Order N-61-20 extended the penalty and interest waiver for unpaid
property taxes through May 2021 as described above under the caption “- Factors that May Affect Pledged
Tax Revenues - Levy and Collection of Taxes.”
It is unknown what net impact, if any, the legislation described above or other future legislation, if enacted,
would have on the local economy or the property values within the Project Areas. Such net impact could
be materially adverse. The potential impact of the Pandemic on the Successor Agency cannot be quantified
at this time.
Last and Final Recognized Obligation Payment Schedule
The Dissolution Act provides that only those payments listed in the Recognized Obligation Payment
Schedule may be made by the Successor Agency from the funds specified in the Recognized Obligation
Payment Schedule. It also provides that a successor agency may file a Last and Final Recognized
Obligation Payment Schedule showing all remaining payments to be made for enforceable obligations. The
Successor Agency’s Last and Final ROPS was approved by the Department of Finance on November 22,
2017. The Successor Agency is permitted to amend the Last and Final ROPS twice. After issuance of the
Bonds, the Successor Agency has covenanted to submit the Amended Last and Final ROPS to the State
Department of Finance to reduce the amount included therein for the Refunded Bonds and add the debt
service for the Bonds.
Cybersecurity
As a recipient and provider of personal, private and sensitive information, the City faces multiple cyber
threats including, but not limited to, hacking, viruses, malware and other attacks on computers and other
sensitive digital networks and systems.
To date, the City has not experienced a material threat to its computer operating system. However, no
assurance can be given that the City’s efforts to manage cyber threats and attacks will be successful in all
cases, or that any such attack will not materially impact the operations or finances of the City or the
Successor Agency, or the administration of the Bonds. The Successor Agency is also reliant on other entities
and service providers in connection with the administration of the Bonds, including without limitation the
County Tax Collector for the levy and collection of Pledged Tax Revenues, the Trustee, and the
Dissemination Agent. No assurance can be given that the City, the Successor Agency and these other
entities will not be affected by cyber threats and attacks in a manner that may affect the Bond Owners.
Secondary Market
There can be no guarantee that there will be a secondary market for the Bonds or, if a secondary market
exists, that such Bonds can be sold for any particular price. Occasionally, because of general market
conditions or because of adverse history or economic prospects connected with a particular issue, secondary
marketing practices in connection with a particular issue are suspended or terminated. Additionally, prices
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of issues for which a market is being made will depend upon then prevailing circumstances. Such prices
could be substantially different from the original purchase price.
TAX MATTERS
In the opinion of Bond Counsel, under existing statutes, regulations, rulings and judicial decisions, interest
on the Bonds is not excluded from gross income for federal income tax purposes under Section 103 of the
Code but interest on the Bonds is exempt from State of California personal income tax.
The amount by which a Bond Owner’s original basis for determining gain or loss on sale or exchange of
the applicable Bond (generally, the purchase price) exceeds the amount payable on maturity (or on an earlier
call date) constitutes amortizable bond premium, which a Bond Owner may elect to amortize under Section
171 of the Code; such amortizable bond premium reduces the Bond Owner’s basis in the applicable Bond
(and the amount of taxable interest received), and is deductible for federal income tax purposes. The basis
reduction as a result of the amortization of bond premium may result in a Bond Owner realizing a taxable
gain when a Bond is sold by the Owner for an amount equal to or less (under certain circumstances) than
the original cost of the Bond to the Owner. Purchasers of Bonds should consult their own tax advisors as
to the treatment, computation and collateral consequences of amortizable bond premium.
Except for certain exceptions, the difference between the issue price of a Bond (the first price at which a
substantial amount of the Bonds of the same series and maturity is to be sold to the public) and the stated
redemption price at maturity with respect to such Bond (to the extent the redemption price at maturity is
greater than the issue price) constitutes original issue discount. Original issue discount accrues under a
constant yield method. The amount of original issue discount deemed received by the Bond Owner will
increase the Bond Owner’s basis in the Bond. Bond Owners should consult their own tax advisor with
respect to taking into account any original issue discount on the Bond.
The federal tax and State of California personal income tax discussion set forth above with respect to the
Bonds is included for general information only and may not be applicable depending upon a Beneficial
Owner’s particular situation. The ownership and disposal of the Bonds and the accrual or receipt of interest
with respect to the Bonds may otherwise affect the tax liability of certain persons. Bond Counsel expresses
no opinion regarding any such tax consequences. BEFORE PURCHASING ANY OF THE BONDS,
POTENTIAL PURCHASERS SHOULD CONSULT THEIR INDEPENDENT TAX ADVISORS WITH RESPECT
TO THE TAX CONSEQUENCES RELATING TO THE BONDS AND THE TAXPAYER’S PARTICULAR
CIRCUMSTANCES.
The complete text of the final opinion that Bond Counsel expects to deliver upon the delivery of the Bonds
is set forth in “APPENDIX F.”
Information Reporting and Backup Withholding
Information reporting requirements apply to interest paid on tax-exempt obligations, including the Bonds.
In general, such requirements are satisfied if the interest recipient completes and provides the payer with a
Form W-9, “Request for Taxpayer Identification Number and Certification,” unless the recipient is one of
a limited class of exempt recipients, including corporations. A recipient not otherwise exempt from
information reporting who fails to satisfy the information reporting requirements will be subject to “backup
withholding,” which means that the payer is required to deduct and withhold a tax from the interest
payment, calculated in the manner set forth in the Code. For the foregoing purpose, a “payer” generally
refers to the person or entity from whom a recipient receives its payments of interest or who collects such
payments on behalf of the recipient.
If an owner purchasing a Bond through a brokerage account has executed a Form W-9 in connection with
the establishment of such account, as generally can be expected, no backup withholding should occur. In
any event, backup withholding does not affect the excludability of the interest on the Bonds from gross
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income for federal income tax purposes. Any amounts withheld pursuant to backup withholding would be
allowed as a refund or a credit against the owner’s federal income tax once the required information is
furnished to the Internal Revenue Service.
LEGAL MATTERS
Enforceability of Remedies
The remedies available to the Trustee and the Owners of the Bonds upon an event of default under the
Indenture or any other document described herein are in many respects dependent upon regulatory and
judicial actions which are often subject to discretion and delay. Under existing law and judicial decisions,
the remedies provided for under such documents may not be readily available or may be limited. The
various legal opinions to be delivered concurrently with the delivery of the Bonds will be qualified to the
extent that the enforceability of certain legal rights related to the Bonds and the Indenture are subject to
limitations imposed by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of
creditors generally and by equitable remedies and proceedings generally.
Approval of Legal Proceedings
Rutan & Tucker, LLP, Irvine, California, as Bond Counsel, will render opinions with respect to the Bonds
which state that the Indenture is a valid and binding obligation of the Successor Agency and enforceable in
accordance with its terms. The legal opinions of Bond Counsel will be subject to the effect of bankruptcy,
insolvency, moratorium and other similar laws affecting creditors’ rights and to the exercise of judicial
discretion in accordance with general principles of equity. See “APPENDIX F” for the proposed forms of
Bond Counsel’s opinions with respect to the Bonds.
The Successor Agency has no knowledge of any fact or other information which would indicate that the
Indenture is not so enforceable against the Successor Agency, except to the extent such enforcement is
limited by principles of equity and by state and federal laws relating to bankruptcy, reorganization,
moratorium or creditors’ rights generally.
Certain legal matters will be passed on for the Successor Agency by the City Attorney, as General Counsel
to the Successor Agency. Nixon Peabody LLP, Los Angeles, California, will also pass on certain legal
matters for the Successor Agency as Disclosure Counsel. Certain legal matters will be passed on for the
Underwriter by its counsel, Best Best & Krieger LLP, Riverside, California. Fees payable to Disclosure
Counsel and Underwriter’s Counsel are contingent upon the sale and delivery of the Bonds.
No Litigation
There is no action, suit or proceeding known to the Successor Agency to be pending and notice of which
has been served upon and received by the Successor Agency, or threatened, restraining or enjoining the
execution or delivery of the Bonds or the Indenture or in any way contesting or affecting the validity of the
foregoing or any proceedings of the Successor Agency taken with respect to any of the foregoing.
CONCLUDING INFORMATION
Rating on the Bonds
S&P Global Ratings (“S&P”) has assigned a rating of “___” to the Bonds. Such rating reflects only the
views of S&P, and any desired explanation of the significance of such rating may be obtained from S&P.
Generally, a rating agency bases its rating on the information and materials furnished to it and on
investigations, studies and assumptions of its own.
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There is no assurance such rating will continue for any given period of time or that such rating will not be
revised downward or withdrawn entirely by the rating agency, if in the judgment of such rating agency,
circumstances so warrant. Any such downward revision or withdrawal of such rating may have an adverse
effect on the market price of the Bonds. Except as otherwise required in the Continuing Disclosure
Agreement, the Successor Agency undertakes no responsibility either to bring to the attention of the owners
of any Bonds any downward revision or withdrawal of any rating obtained or to oppose any such revision
or withdrawal. A rating is not a recommendation to buy, sell or hold securities and may be subject to
revision or withdrawal at any time.
The Municipal Advisor
The material contained in this Official Statement was prepared by the Successor Agency with the assistance
of Harrell & Company Advisors, LLC, Orange, California, an independent financial consulting firm, which
advised the Successor Agency as to the financial structure and certain other financial matters relating to the
Bonds. The information set forth herein has been obtained by the Successor Agency from sources which
are believed to be reliable, but such information is not guaranteed by the Municipal Advisor as to accuracy
or completeness, nor has it been independently verified.
Continuing Disclosure
The Successor Agency will provide annually certain financial information and data relating to the Bonds
by not later than March 31 in each year commencing March 31, 2022 (the “Annual Report”), and to provide
notices of the occurrence of certain other listed events. Willdan Financial Services will act as Dissemination
Agent. The specific nature of the information to be contained in the Annual Report or the notices of listed
events and certain other terms of the continuing disclosure obligation are found in the form of the Successor
Agency’s Disclosure Agreement attached in “APPENDIX E - FORM OF CONTINUING DISCLOSURE
AGREEMENT.”
In the previous 5 years, the Successor Agency believes it has complied in all material respects with any
undertaking made pursuant to the Rule.
Underwriting
The Bonds are being sold at an aggregate purchase price of $________ (representing the aggregate principal
amount of the Bonds less an underwriting discount of $__________) pursuant to a bond purchase contract
(“Bond Purchase Contract”) entered into between the Successor Agency and Hilltop Securities Inc. (the
“Underwriter”).
The expenses associated with the issuance of the Bonds are being paid by the Successor Agency from
proceeds of the Bonds. The right of the Underwriter to receive compensation in connection with the Bonds
is contingent upon the issuance and delivery by the Successor Agency, and the purchase by the Underwriter,
of the Bonds. The Bond Purchase Contract provides that the Underwriter will purchase all of the Bonds if
any are purchased and that the obligation of the Underwriter to accept and pay for the Bonds is subject to
certain terms and conditions set forth therein, including the approval by counsel of certain legal matters.
The Underwriter will initially offer the Bonds for sale at the prices and yields set forth on the inside cover
page of this Official Statement. Such prices or yields may subsequently change. The Underwriter reserves
the right to join with dealers and other investment banking firms in offering the Bonds for sale and may
offer to sell Bonds to dealers at prices lower than the initial offering prices.
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References
All statements in this Official Statement involving matters of opinion, whether or not expressly so stated,
are intended as such and not as representations of fact. This Official Statement is not to be construed as a
contract or agreement between the Successor Agency and the purchasers or Owners of any of the Bonds.
Execution
The execution and delivery of this Official Statement by the Executive Director of the Successor Agency
has been duly authorized by the Successor Agency.
SUCCESSOR AGENCY TO THE
LA QUINTA REDEVELOPMENT AGENCY
By: ___________________________
Executive Director
[Remainder of Page Intentionally Left Blank]
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APPENDIX A
SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE
[TO BE PROVIDED BY BOND COUNSEL]
108
APPENDIX B
MUNICIPAL ADVISOR’S
PROJECTED TAX REVENUES REPORT
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B-1
PROJECTED TAX REVENUES
Dissolution Act
On June 29, 2011, Assembly Bill No. 26 (“AB X1 26”) was enacted as Chapter 5, Statutes of 2011. As a
result of AB X1 26 and the decision of the California Supreme Court in California Redevelopment
Association, et al. v. Matosantos, et al., 53 Cal. 4th 231 (Cal. 2011), as of February 1, 2012, all
redevelopment agencies in the State were dissolved, including the Prior Agency, and successor agencies
were designated as successor entities to the former redevelopment agencies to expeditiously wind down the
affairs of the former redevelopment agencies.
AB X1 26 was amended on June 27, 2012 by Assembly Bill No. 1484 (“AB 1484”), enacted as Chapter 26,
Statutes of 2012 and by Senate Bill No. 107 (“SB 107”) enacted as Chapter 325, Statutes of 2015 (as
amended from time to time, the “Dissolution Act”).
Pursuant to Section 34173 of the Dissolution Act, the City Council serves as the governing board of the
successor agency to the Prior Agency. Since the February 1, 2012 dissolution of the Prior Agency, the City
has served as the Successor Agency to the La Quinta Redevelopment Agency (the “Successor Agency”).
Tax Allocation Financing
Prior to the enactment of AB X1 26, the Redevelopment Law authorized the financing of redevelopment
projects through the use of tax increment revenues. First, the assessed valuation of the taxable property in
a project area, as last equalized prior to adoption of the redevelopment plan, was established and became
the base roll. Thereafter, except for any period during which the assessed valuation dropped below the base
year level, the taxing agencies, on behalf of which taxes are levied on property within the project area,
receive the taxes produced by the levy of the then current tax rate upon the base roll. Taxes collected upon
any increase in the assessed valuation of the taxable property in a project area over the levy upon the base
roll could be pledged by a redevelopment agency to the repayment of any indebtedness incurred in financing
the redevelopment project. Redevelopment agencies themselves had no authority to levy taxes on property.
The Dissolution Act now requires the County Auditor-Controller to determine the amount of property taxes
that would have been allocated to the Prior Agency had the Prior Agency not been dissolved pursuant to the
operation of AB X1 26, using current assessed values on the last equalized roll on August 20, and to deposit
that amount in the Redevelopment Property Tax Trust Fund for the Successor Agency established and held
by the County Auditor-Controller (the “Redevelopment Property Tax Trust Fund”) pursuant to the
Dissolution Act. The Dissolution Act provides that any bonds authorized thereunder to be issued by the
Successor Agency will be considered indebtedness incurred by the dissolved Prior Agency, with the same
legal effect as if the bonds had been issued prior to effective date of AB X1 26, in full conformity with the
applicable provision of the Redevelopment Law that existed prior to that date, and will be included in the
Successor Agency’s Recognized Obligation Payment Schedule.
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Tax Increment Revenues
Pursuant to subdivision (b) of Section 33670 of the Redevelopment Law and Section 16 of Article XVI of
the State Constitution and as provided in the Redevelopment Plans, taxes levied upon taxable property in
the Project Areas each year by or for the benefit of the State, any city, county, city and county, district, or
other public corporation (herein sometimes collectively called “taxing agencies”) after the effective date
of the ordinance approving the related Redevelopment Plan, or the respective effective dates of ordinances
approving amendments to the related Redevelopment Plan that added territory to a Project Area, if any,
are to be divided as follows:
(a) To Taxing Agencies: That portion of the taxes which would be produced by the rate upon which
the tax is levied each year by or for each of the taxing agencies upon the total sum of the assessed
value of the taxable property in a Project Area as shown upon the assessment roll used in connection
with the taxation of such property by such taxing agency last equalized prior to the effective date
of the ordinance adopting the Redevelopment Plan (the “base year valuation”), will be allocated to,
and when collected will be paid into, the funds of the respective taxing agencies as taxes by or for
the taxing agencies on all other property are paid; and
(b) To the Prior Agency/Successor Agency: Except for that portion of the taxes in excess of the amount
identified in (a) above which are attributable to a tax rate levied by a taxing agency for the purpose
of producing revenues in an amount sufficient to make annual repayments of the principal of, and
the interest on, any bonded indebtedness approved by the voters of the taxing agency on or after
January 1, 1989 for the acquisition or improvement of real property, which portion shall be
allocated to, and when collected shall be paid into, the fund of that taxing agency, that portion of
the levied taxes each year in excess of such amount, annually allocated within limitations
established by the Redevelopment Plan, following the date of issuance of the Bonds, when collected
will be paid into a special fund of the Successor Agency. Section 34172 of the Dissolution Act
provides that, for purposes of Section 16 of Article XVI of the State Constitution, the
Redevelopment Property Tax Trust Fund shall be deemed to be a special fund of the Successor
Agency to pay the debt service on indebtedness incurred by the Prior Agency or the Successor
Agency to finance or refinance the redevelopment projects of the Prior Agency.
That portion of the levied taxes described in paragraph (b) above, less amounts deducted pursuant to
Section 34183(a) of the Dissolution Act for permitted administrative costs of the County Auditor-
Controller, constitute the amounts required under the Dissolution Act to be deposited by the County
Auditor-Controller into the Redevelopment Property Tax Trust Fund. In addition, Section 34183 of the
Dissolution Act effectively eliminates the January 1, 1989 date from paragraph (b) above. Pursuant to SB
107, effective September 22, 2015, debt service override revenues approved by the voters for the purpose
of supporting pension programs or capital projects, and programs related to the State Water Project, that
are not pledged to or needed for debt service on successor agency obligations are allocated and paid to the
entity that levies the override and will not be deposited into the Redevelopment Property Tax Trust Fund.
Therefore, overrides levied within the Project Areas are not pledged to the payment of debt service on the
Bonds.
The amounts calculated in accordance with the provisions described above are referred to herein as “Tax
Increment Revenues.”
Redevelopment Plans
The City Council approved and adopted the Redevelopment Plan for Project Area No. 1 on November 29,
1983, pursuant to Ordinance No. 43. It was subsequently amended on December 20, 1994 pursuant to
Ordinance No. 258 to add limitations prescribed by AB 1290, again on March 21, 1995 pursuant to
Ordinance No. 264 to amend financial limits and time to initiate eminent domain actions, on August 19,
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2003 pursuant to Ordinance No. 388 to eliminate the time limit to incur debt as authorized by SB 211 and
again on March 16, 2004 pursuant to Ordinance No. 402 to extend the Redevelopment Plan duration by one
year as authorized by SB 1045.
The City Council approved and adopted the Redevelopment Plan for Project Area No. 2 on May 16, 1989,
pursuant to Ordinance No. 139. It was subsequently amended on December 20, 1994 pursuant to Ordinance
No. 259 to add limitations prescribed by AB 1290, again on February 3, 2004 pursuant to Ordinance No.
399 to amend financial limits, on March 16, 2004 pursuant to Ordinance Nos. 403 and 404 to eliminate the
time limit to incur debt as authorized by SB 211 and to extend the Redevelopment Plan duration by one
year as authorized by SB 1045, and again on February 1, 2011 pursuant to Ordinance No. 485 to add
territory for purposes of affordable housing.
Plan Limitations
In accordance with the Redevelopment Law, redevelopment plans were required to include certain limits
on the financing of redevelopment projects. These limits could include a time limit on the life of the
redevelopment plan, a time limit to incur debt, a time limit on the receipt of Tax Increment Revenues and
the repayment of debt, and a limit on the amount of bonded indebtedness outstanding at any time. SB 107
clarifies that the former limit on the amount of tax increment and time within which tax increment could be
received by redevelopment agencies in redevelopment plans no longer apply for purposes of paying
approved enforceable obligations such as the tax allocation bonds and loans incurred by the Prior Agency
or refunding tax allocation bonds issued by the Successor Agency. The original time limit for receipt of tax
increment in Project Area No. 1 was 2034, and for Project Area No. 2 was 2040.
Historical Assessed Value and Tax Increment Revenues
Historical assessed value and gross tax increment revenues for Project Area No. 1 based on the equalized
tax rolls and actual gross tax increment revenues deposited to the Redevelopment Property Tax Trust Fund
are shown below.
TABLE NO. B-1
PROJECT AREA NO. 1
HISTORICAL ASSESSED VALUATIONS AND GROSS TAX INCREMENT REVENUES
2016-17 2017-18 2018-19 2019-20 2020-21
Secured Assessed Value $4,977,966,406 $5,103,964,054 $5,278,711,343 $5,482,423,278 $5,660,100,486
Unsecured Assessed Value 34,377,191 28,437,371 22,748,622 36,027,567 17,201,305
Total Assessed Valuation (1) 5,012,343,597 5,132,401,425 5,301,459,965 5,518,450,845 5,677,301,791
Base Year Valuation (199,398,232) (199,398,233) (199,398,233) (199,398,233) (199,398,233)
Incremental Valuation $4,812,945,365 $4,933,003,192 $5,102,061,732 $5,319,052,612 $5,477,903,558
Basic Tax Rate/$100 1.00% 1.00% 1.00% 1.00% 1.00%
Tax Increment Revenues 48,129,454 49,330,032 51,020,617 53,190,526 54,779,036
Unitary Revenues 648,065 673,895 700,186 722,959 737,500(2)
Gross Tax Revenues $ 48,777,519 $ 50,003,927 $ 51,720,803 $ 53,913,485 $ 55,516,536
Actual RPTTF Deposit $ 49,210,774 $ 50,475,054 $ 51,956,505 $ 54,312,406 N/A
______________________________________
(1) Taxable Valuation as of August 20 equalized roll.
(2) Estimated.
Source: Riverside County Auditor-Controller.
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Actual gross deposits and deductions from the RPTTF for Project Area No. 1 are shown below:
TABLE NO. B-2
PROJECT AREA NO. 1
HISTORICAL TAX REVENUES
2016-17 2017-18 2018-19 2019-20
Actual Tax Revenues $49,210,774 $50,475,054 $51,956,505 $54,312,406
Senior Tax Sharing (1,137,449) (2,269,947) (2,420,239) (2,622,759)
Available for Debt Service 48,073,325 48,205,107 49,536,266 51,689,647
Subordinate Tax Sharing(1) (20,052,159) (21,511,706) (22,227,242) (23,270,556)
Net Deposit to RPTTF $28,021,166 $26,693,401 $27,309,024 $28,419,092
______________________________________
(1) Available if needed to pay debt service pursuant to Section 34183(b) of the Dissolution Act.
Source: Riverside County Auditor-Controller.
Historical assessed value and gross tax increment revenues for Project Area No. 2 based on the equalized
tax rolls and actual gross tax increment revenues deposited to the Redevelopment Property Tax Trust Fund
are shown below.
TABLE NO. B- 3
PROJECT AREA NO. 2
HISTORICAL ASSESSED VALUATIONS AND GROSS TAX INCREMENT REVENUES
2016-17 2017-18 2018-19 2019-20 2020-21
Secured Assessed Value $2,777,740,583 $2,850,974,377 $2,959,127,650 $3,055,267,270 $3,141,480,380
Unsecured Assessed Value 58,960,131 60,680,434 56,673,732 56,542,535 53,773,198
Total Assessed Valuation (1) 2,836,700,714 2,911,654,811 3,015,801,382 3,111,809,805 3,195,253,578
Base Year Valuation (95,182,755) (95,182,755) (95,182,755) (95,182,755) (95,182,755)
Incremental Valuation $2,741,517,959 $2,816,472,056 $2,920,618,627 $3,016,627,050 $3,100,070,823
Basic Tax Rate/$100 1.00% 1.00% 1.00% 1.00% 1.00%
Tax Increment Revenues 27,415,180 28,164,721 29,206,186 30,166,271 31,000,708
Unitary Revenues 267,828 279,191 291,982 301,423 307,500(2)
Gross Tax Revenues $ 27,683,008 $ 28,443,912 $ 29,498,168 $ 30,467,694 $ 31,308,208
Actual RPTTF Deposit $ 28,205,847 $ 28,643,547 $ 29,637,091 $ 30,742,836 N/A
______________________________________
(1) Taxable Valuation as of August 20 equalized roll.
(2) Estimated.
Source: Riverside County Auditor-Controller.
[Remainder of Page Intentionally Left Blank]
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Actual gross deposits and deductions from the RPTTF for Project Area No. 2 are shown below:
TABLE NO. B-4
PROJECT AREA NO. 2
HISTORICAL TAX REVENUES
2016-17 2017-18 2018-19 2019-20
Actual Tax Revenues $28,205,847 $28,643,547 $29,637,091 $30,742,836
Senior Tax Sharing (19,009,829) (19,304,225) (19,973,303) (20,716,940)
Net Deposit to RPTTF $ 9,196,018 $ 9,339,322 $ 9,663,788 $10,025,897
______________________________________
Source: Riverside County Auditor-Controller.
Major Taxpayers
The ten largest property taxpayers represent 6.1% of the 2020-21 total assessed value of Project Area No.
1 and 6.2% of the incremental assessed value of Project Area No. 1.
TABLE NO. B-5
PROJECT AREA NO. 1
TEN LARGEST TAXPAYERS AS A PERCENT OF 2020-21 TOTAL ASSESSED VALUE
2020-21 % of Total Total Assessed Assessed
Taxpayer Value Value Land Use
BRE Iconic LQR LLC $163,077,289 2.9% Hotel
Silverhawk Apartments LP 26,077,707 0.5% Apartments
Palm Desert Lodging 24,312,125 0.4% Hotel
RREF II CWC LAQ 22,268,605 0.4% Residential
HJ GG Partners LLC 20,982,350 0.4% Residential
OTLQ LLC 20,039,994 0.4% Commercial
LQ Investment 17,024,220 0.3% Commercial
Tradition Golf Club 16,574,079 0.3% Country Club
Quarry at La Quinta Inc. 14,284,458 0.3% Hotel
Silverrock Phase I 12,346,106 0.2% Golf Course
$336,986,933 6.1%
______________________________________
Source: Municipal Advisor.
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The ten largest property taxpayers represent 9.3% of the 2020-21 total assessed value of Project Area No.
2 and 9.5% of the incremental assessed value of Project Area No. 2.
TABLE NO. B-6
PROJECT AREA NO. 2
TEN LARGEST TAXPAYERS AS A PERCENT OF 2020-21 TOTAL ASSESSED VALUE
2020-21 % of Total Total Assessed Assessed
Taxpayer Value Value Land Use
Inland American La Quinta Pavilion $ 50,248,920 1.6% Commercial
Hawthorne IL Propco 45,760,953 1.4% Assisted Living
Walmart Real Estate Business Trust 32,199,420 1.0% Commercial
Health Care Reit Inc. 27,473,475 0.9% Commercial
Aventine Dev. 27,380,407 0.9% Apartments
Costco Wholesale Corporation 26,550,676 0.8% Commercial
CSRA Komar Desert Center St. 26,343,936 0.8% Commercial
RREF La Quinta REO 20,934,021 0.7% Commercial
TD Desert Development LP 19,700,507 0.6% Residential
Eagle Hardware and Garden Inc./Lowes 19,239,506 0.6% Commercial
$295,831,821 9.3%
______________________________________
Source: Municipal Advisor.
Assessment Appeals
Project Area No. 1
As of July 2020, there were a total 44 pending appeals filed by property owners in Project Area No. 1 as
shown below. The total value of property under appeal for all years is $73.1 million. Some appeals have
been filed for multiple years for the same property. A summary of all pending appeals is shown below.
Pending Value of Property % of
Tax Year Appeals Under Appeal Tax Roll
2016-17 1 $ 1,622,318 0.0%
2017-18 2 4,570,727 0.1%
2018-19 14 23,804,606 0.4%
2019-20 27 43,071,328 0.8%
Total 44 $73,068,979 N/A
______________________________________
Source: Municipal Advisor.
For Fiscal Years 2015-16 to 2018-19, 13 of 59 (22%) of resolved appeals were successful, with an average
reduction in assessed value of 35.7%. The Successor Agency cannot predict the outcome of any pending
appeals.
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Project Area No. 2
As of July 2020, there were a total 77 pending appeals filed by property owners in Project Area No. 2 as
shown below. The total value of property under appeal for all years is $344.8 million. Some appeals have
been filed for multiple years for the same property. A summary of all pending appeals is shown below.
Pending Value of Property % of
Tax Year Appeals Under Appeal Tax Roll
2016-17 13 $ 59,941,506 2.1%
2017-18 16 67,320,471 2.3%
2018-19 30 149,627,794 5.0%
2019-20 18 67,909,524 2.2%
Total 77 $344,799,295 N/A
______________________________________
Source: Municipal Advisor.
For Fiscal Years 2015-16 to 2018-19, 10 of 29 (34%) of resolved appeals were successful, with an average
reduction in assessed value of 47.9%. The Successor Agency cannot predict the outcome of any pending
appeals.
While the Successor Agency expects some decline in total assessed valuation as a result of pending or
potential future appeals, no prediction can be made as to the amount of the decline in total assessed
valuation, if any, within the Project Areas. No reduction for pending appeals in the Project Areas has been
incorporated in the projections. Reductions in revenue for refunds resulting from successful appeals or
current or prior year appeals have also not been incorporated into the projections. The success rate of
appeals, reductions granted and refunds may vary from historical averages.
Tax Sharing Agreements
Pursuant to prior Section 33401(b) of the Redevelopment Law, a redevelopment agency could enter into an
agreement to pay tax increment revenues to any taxing agency that has territory located within a
redevelopment project to alleviate any financial burden or detriment caused by the redevelopment project.
These agreements are commonly known as “tax sharing agreements” or “pass-through agreements” and are
referred to herein as “Contractual Tax Sharing Agreements.” The following describes the agreements
entered into with respect to the Project Areas.
For the purpose of calculating tax sharing under either Section 33401 or 33607 of the Redevelopment Law
(described under the caption “Tax Sharing Statutes”), the Dissolution Act provides that, if applicable, the
amount of tax sharing payments shall be computed as though the requirement to set aside funds for the Low
and Moderate Income Housing Fund was still in effect.
Project Area No. 1
County General Fund, Library, and Fire Districts
Pursuant to the “Replacement Cooperation Agreement Between the County of Riverside and the City of La
Quinta and the La Quinta Redevelopment Agency” executed on December 21, 1993, the County General
Fund, Library District, and Fire District are to receive their full 100 percent share of the gross (before
housing fund deposits) tax increment. The County General Fund tax levy within the Project Area is 24.78
percent, while the Library and Fire District tax levies are 2.77 percent and 5.96 percent, respectively.
The Replacement Cooperation Agreement provides that the payment of County tax increment revenue is
subordinate to debt service for existing Project bond debt, and any future bonds issued in connection with
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La Quinta Project No. 1. However, the Agreement required the Prior Agency to size new bond issuances
in such a way that sufficient funds are projected to be available to satisfy its obligations to the County
pursuant to the Agreement without subordination.
Coachella Valley Unified School District
The Prior Agency’s agreement with the Coachella Valley Unified School District provided for a fixed series
of payments to be made by the Prior Agency to the Coachella Valley Unified School District, with the final
payment due July 1, 2012. Their obligations under this agreement have been paid in full.
Desert Sands Unified School District
The Prior Agency’s agreement with the Desert Sands Unified School District (“DSUSD”) requires that the
Agency deposit a portion of the DSUSD’s revenues into a capital fund to be used for the purpose of
financing various capital projects that benefit both DSUSD and the Project Area. The payments were
contingent upon the Prior Agency reaching a $300 million tax increment threshold, which occurred in 2004-
05. Annually, during the first ten years following the year in which the Prior Agency’s cumulative tax
increment exceeded $300 million, the Agency was required to deposit an amount equal to 20 percent of the
DSUSD’s 29.09 percent share. Beginning in the eleventh year (2015-16) and continuing for the
Redevelopment Plan’s duration, the Successor Agency will deposit 25 percent of the DSUSD’s share of tax
increment.
The Agreement provides that payments to the DSUSD do not constitute an “express pledge” within the
meaning of Redevelopment Law Section 33671.5, and therefore, payments to the DSUSD are subordinate
to all bond debt service.
Desert Community College
The Prior Agency’s agreement with Desert Community College District requires the Agency to pay 20
percent of the Desert Community College District's share to the District. The payments were contingent
upon the Prior Agency reaching a $300 million tax increment threshold. Beginning in the eleventh year
following the $300 million threshold event (2015-16) and continuing thereafter, the Successor Agency is
required pay 25 percent of the Desert Community College District’s share. The Agreement provides that
payments to the District do not constitute an “express pledge” within the meaning of Redevelopment Law
Section 33671.5, and therefore, payments to the Desert Community College District are subordinate to all
bond debt service.
Coachella Valley Mosquito and Vector Control
The Prior Agency’s agreement with the Coachella Valley Mosquito and Vector Control District, requires
the Agency to pay the District its full 100 percent share of the gross tax increment net of the 20 percent
contribution to the Housing Fund, of the District's 1.39 percent levy of the net tax increment (net of housing
fund deposits). The levy shall not exceed 1.43 percent and it is currently 1.39 percent. This pass-through
obligation is senior to all bond debt service payments and is excluded from the pledge of nonhousing
revenues for the bond financing.
The Dissolution Act specifically allows the payments under tax sharing agreements that were calculated
“net of housing fund deposits” to continue to be calculated as if the housing fund deposits continued to be
made.
Coachella Valley Water District
The Prior Agency’s agreement with the Coachella Valley Water District requires that the Successor Agency
pay to the Coachella Valley Water District (“CVWD”) a portion of the CVWD share of the gross tax
increment, equal to 2.78 percent. The Agreement includes those payments to CVWD, CVWD
Improvement District, and CVWD Storm Water Unit, and provides that such payments shall not be
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subordinate to all debt service other than that previously issued to finance flood control improvements.
Therefore, these payments are not subordinate to existing and new bond debt service payments.
Project Area No. 2
Desert Community College District (Formerly the Coachella Valley Community College District)
The Prior Agency’s agreement with the Desert Community College District provides that the College
District will receive 50 percent of the tax increment revenue generated by the College District’s 7.73 percent
property tax levy.
Coachella Valley Mosquito and Vector Control District
The Prior Agency’s agreement with the Coachella Valley Mosquito and Vector Control District provides
for payment to the District of 100 percent of the tax increment revenue generated by the District’s 1.41
percent share of property tax levy.
Desert Recreation District
The Prior Agency’s agreement with the Desert Recreation District provides for payment to the District of
25 percent of the tax increment revenue generated by the District’s 2.13 percent property tax levy.
Coachella Valley Water District
The Prior Agency’s agreement with the Water District provides for payment to the Water District of 100
percent of the tax increment revenue generated by the Water District’s 7.67 percent property tax levy,
inclusive of the Coachella Valley Water District, the CVWD Improvement District, and the CVWD Storm
Water Unit.
County of Riverside
The Prior Agency’s agreement with the County of Riverside provides for full payment of the tax increment
revenue generated by the County General Fund (24.43%), Library District (2.80%), and Fire District
(6.03%) property tax levies. Additionally, the Agency is paying the County $1.2 million over the next 5
years to reimburse the County for tax increment revenue generated by the County’s General Fund property
tax levy the Agency retained during the initial years of the Redevelopment Plan.
Riverside County Superintendent/County Office of Education
This Prior Agency’s agreement with the Riverside County Superintendent/Office of Education provides
that the Office shall receive 50% of the tax increment revenue generated by their 4.20% share of the
property tax levy.
Desert Sands Unified School District
The Prior Agency’s agreement with DSUSD provides that the Agency will retain 50 percent of the tax
increment revenue generated by the DSUSD’s 37.19 percent share of the property tax levy. The remaining
50 percent is paid to DSUSD.
Tax Sharing Statutes
Certain provisions were added to the Redevelopment Law by the adoption of AB 1290 in 1994. If a project
area was created after 1994, or if new territory was added to a project area, under Section 33607.5 of the
Redevelopment Law, any affected taxing entity would share in the Tax Increment Revenues generated by
such added area pursuant to a statutory formula (“Statutory Tax Sharing”).
In addition, pursuant to Section 33333.6(e)(2) of the Redevelopment Law, if the Agency amended or deleted
the time limit to incur indebtedness in a project area or increased the total amount of Tax Increment
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Revenues to be allocated to the project area or increased the duration of the redevelopment plan for a project
area and the period for receipt of Tax Increment Revenues, Statutory Tax Sharing is also be required under
Section 33607.7 of the Redevelopment Law with all affected taxing agencies not already a party to a tax
sharing agreement, once the original limitations have been reached.
In general, the amounts to be paid pursuant to Statutory Tax Sharing are as follows:
(a) commencing in the first fiscal year after the limitation has been reached, an amount equal to 25%
of tax increment revenues generated by the incremental increase of the current year assessed
valuation over the assessed valuation in the fiscal year that the limitation had been reached, after
the amount required to be deposited in the Low and Moderate Income Housing Fund has been
deducted;
(b) in addition to amounts payable as described in (a) above, commencing in the 11th fiscal year after
the limitation has been reached, an amount equal to 21% of tax increment revenues generated by
the incremental increase of the current year assessed valuation over the assessed valuation in the
preceding 10th fiscal year that the limitation had been reached, after the amount required to be
deposited in the Low and Moderate Income Housing Fund has been deducted; and
(c) in addition to amounts payable as described in (a) and (b) above, commencing in the 31st fiscal year
after the limitation has been reached, an amount equal to 14% of tax increment revenues generated
by the incremental increase of the current year assessed valuation over the assessed valuation in
the preceding 30th fiscal year that the limitation had been reached, after the amount required to be
deposited in the Low and Moderate Income Housing Fund has been deducted.
(d) The City may elect to receive a portion of the tax increment generated in (a) above, after the amount
required to be deposited in the Low and Moderate Income Housing Fund has been deducted.
(e) The Agency may subordinate the amount required to be paid to an affected taxing entity to any
indebtedness after receiving the consent of the taxing entity.
With respect to a taxing entity that is a party to a tax sharing agreement, tax sharing payments would
continue pursuant to the Tax Sharing Agreement after the original limitations in the Redevelopment Plan
were passed.
The Agency eliminated the January 1, 2004 time limit to incur debt for Project Area No. 1 and payments to
certain taxing entities pursuant to Section 33607.7 commenced in Fiscal Year 2004-05. The Agency also
eliminated the May 16, 2009 time limit to incur debt for Project Area No. 2, and payments to certain taxing
entities pursuant to Section 33607.7 commenced in Fiscal Year 2009-10.
As noted above, with the consent of the Taxing Entity, the payments under the Tax Sharing Statutes may be
subordinated to certain Agency obligations. No payments to Taxing Entities with respect to Statutory Tax
Sharing have been subordinated.
Since dissolution, the County Auditor-Controller calculates and pays the Statutory Tax Sharing amounts.
Projected Tax Revenues
Deposits in the Redevelopment Property Tax Trust Fund in the amounts and at the times projected by the
Successor Agency depends on the realization of certain assumptions relating to the Tax Increment
Revenues. The projections of Tax Increment Revenues and the corresponding Pledged Tax Revenues from
the Project Areas shown on the following tables were based on the assumptions shown below. The
Municipal Advisor believes the assumptions upon which the projections are based are reasonable; however,
some assumptions may not materialize and unanticipated events and circumstances may occur.
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(a) The 2020-21 secured roll was increased by 2% annually for inflation in future years.
(b) The values of unsecured personal property have been maintained throughout the projections at the
2020-21 unsecured roll value.
(c) The amount of unitary revenues have been maintained throughout the projections at their 2019-20
amount.
(d) For the purposes of the projections, it was assumed that no additional assessed value would be
added to the tax rolls as a result of new construction.
(e) No potential future Proposition 8 adjustments or potential reductions in value as a result of pending
assessment appeals are reflected in the projections.
(f) A tax rate of $1.00 per $100 of assessed value applied to the taxable property in the Project Areas
was used to determine Tax Increment Revenues.
(g) Projected Pledged Tax Revenues do not reflect supplemental property taxes.
(h) Projected Pledged Tax Revenues include a deduction for administrative costs charged by Riverside
County.
(i) Projected Pledged Tax Revenues include a deduction for payments due to taxing agencies under
Contractual Tax Sharing Agreements or applicable Tax Sharing Statutes, excluding the subordinate
payments of the Subordinated Pass-Through Amounts.
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TABLE NO. B-7
SUCCESSOR AGENCY PROJECTED TAX REVENUES
(in thousands)
Project No. 1 Project No. 2 Project No. 1
Fiscal Net RPTTF Net RPTTF Net RPTTF Subordinated Pledged Tax
Year Deposit (1) Deposit Deposit Pass-Through Amounts (2) Revenues
2021 $28,244 $ 9,875 $38,119 $23,703 $61,822
2022 28,789 10,067 38,856 24,186 63,042
2023 29,343 10,263 39,606 24,679 64,285
2024 29,909 10,395 40,304 25,182 65,486
2025 30,484 10,589 41,073 25,695 66,768
2026 31,074 10,789 41,863 26,218 68,081
2027 31,673 10,991 42,664 26,752 69,416
2028 32,286 11,197 43,483 27,295 70,778
2029 32,911 11,409 44,320 27,851 72,171
2030 33,545 11,626 45,171 28,419 73,590
2031 34,197 11,845 46,042 28,995 75,037
2032 34,860 12,069 46,929 29,584 76,513
______________________________________
(1) After deduction of Subordinated Pass-Through Amounts.
(2) Available if needed to pay debt service pursuant to Section 34183(b) of the Dissolution Act.
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B-13 TABLE NO. B-8 PROJECT AREA NO. 1 PROJECTED TAX REVENUES (in thousands) Senior Tax Sharing Agreements Subordinated Tax Sharing Amounts County CV Mosquito CV Statutory Desert Sands Desert Net Fiscal Gross Admin and Vector Water Tax County County County Unified Community Deposit to Year RPTTF Fees Control District Sharing General Library Fire School College RPTTF 2021 $55,517 $(522) $(618) $(1,543) $ (887) $(13,757) $(1,538) $(3,310) $(4,037) $(1,061) $28,244 2022 56,649 (533) (630) (1,574) (937) (14,037) (1,569) (3,378) (4,120) (1,082) 28,789 2023 57,803 (543) (643) (1,606) (989) (14,323) (1,601) (3,447) (4,204) (1,104) 29,343 2024 58,981 (554) (656) (1,639) (1,041) (14,615) (1,634) (3,517) (4,289) (1,127) 29,909 2025 60,182 (566) (670) (1,672) (1,095) (14,912) (1,667) (3,589) (4,377) (1,150) 30,484 2026 61,408 (577) (683) (1,707) (1,149) (15,216) (1,701) (3,662) (4,466) (1,173) 31,074 2027 62,657 (589) (697) (1,741) (1,205) (15,526) (1,736) (3,736) (4,557) (1,197) 31,673 2028 63,932 (601) (711) (1,777) (1,262) (15,842) (1,771) (3,812) (4,649) (1,221) 32,286 2029 65,233 (613) (726) (1,813) (1,319) (16,164) (1,807) (3,890) (4,744) (1,246) 32,911 2030 66,559 (626) (741) (1,850) (1,378) (16,493) (1,844) (3,969) (4,841) (1,272) 33,545 2031 67,912 (638) (756) (1,887) (1,439) (16,828) (1,881) (4,050) (4,939) (1,297) 34,197 2032 69,292 (651) (771) (1,926) (1,500) (17,170) (1,919) (4,132) (5,039) (1,324) 34,860 [Remainder of Page Intentionally Left Blank] 122
B-14 TABLE NO. B-9 PROJECT AREA NO. 2 PROJECTED TAX REVENUES (in thousands) Tax Sharing Agreements County Desert Sands Desert CV Mosquito County Desert CV Statutory Net Fiscal Gross Admin County County County Unified Community and Vector Office of Recreation Water Tax Deposit to Year RPTTF Fees General Library Fire School College Control Education District District Sharing RPTTF 2021 $31,308 $(294) $(7,649) $ (877) $(1,888) $(5,822) $(1,210) $(441) $(657) $(167) $(2,401) $ (27) $ 9,875 2022 31,937 (300) (7,802) (894) (1,926) (5,939) (1,234) (450) (671) (170) (2,450) (34) 10,067 2023 32,577 (306) (7,959) (912) (1,964) (6,058) (1,259) (459) (684) (173) (2,499) (41) 10,263 2024 33,231 (312) (8,118) (930) (2,004) (6,179) (1,284) (469) (698) (177) (2,549) (116) 10,395 2025 33,898 (319) (8,281) (949) (2,044) (6,303) (1,310) (478) (712) (181) (2,600) (132) 10,589 2026 34,578 (325) (8,447) (968) (2,085) (6,430) (1,336) (488) (726) (184) (2,652) (148) 10,789 2027 35,272 (332) (8,617) (988) (2,127) (6,559) (1,363) (497) (741) (188) (2,705) (164) 10,991 2028 35,979 (338) (8,790) (1,007) (2,170) (6,690) (1,391) (507) (756) (192) (2,760) (181) 11,197 2029 36,701 (345) (8,966) (1,028) (2,213) (6,825) (1,418) (517) (771) (195) (2,815) (199) 11,409 2030 37,437 (352) (9,146) (1,048) (2,257) (6,961) (1,447) (528) (786) (199) (2,871) (216) 11,626 2031 38,188 (359) (9,329) (1,069) (2,303) (7,101) (1,476) (538) (802) (203) (2,929) (234) 11,845 2032 38,954 (366) (9,516) (1,091) (2,349) (7,243) (1,506) (549) (818) (207) (2,988) (252) 12,069 [Remainder of Page Intentionally Left Blank] 123
C-1
APPENDIX C
CITY OF LA QUINTA INFORMATION STATEMENT
The following information concerning the City of La Quinta is presented as general background data. The
Bonds are payable solely from Pledged Tax Revenues, as described in the Official Statement. The Bonds
are not an obligation of the City, and the taxing power of the City is not pledged to the payment of the
Bonds.
General Information
The City is located 127 miles east of Los Angeles and 20 miles east of Palm Springs in the area of Riverside
County known as the “Coachella Valley.” The City was originally a general law city incorporated on
May 1, 1982, became a charter city in November 1996 and provides for a Council-City Manager form of
government consisting of five Council Members elected to four-year overlapping terms. The Mayor is
directly elected by the citizens to a two-year term.
The City encompasses an area of over 35 square miles.
Population
The following table provides population growth for the City of La Quinta and Riverside County between
2016 and 2020.
TABLE NO. C-1
CHANGE IN POPULATION
CITY OF LA QUINTA AND RIVERSIDE COUNTY
2016 – 2020
CITY OF LA QUINTA RIVERSIDE COUNTY
January 1 Percentage Percentage
Year Population Change Population Change
2016 39,769 2,343,785
2017 40,065 0.7% 2,376,580 1.4%
2018 40,217 0.4% 2,400,762 1.0%
2019 40,389 0.4% 2,422,146 0.9%
2020 40,660 0.7% 2,442,304 0.8%
% Change Between 2016 - 2020 2.2% 4.2%
__________________________________
Source: State of California, Department of Finance, “E-4 Population Estimates for Cities, Counties and the State,
2011-2020, with 2010 Census Benchmark” Sacramento, California, May 2020.
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C-2
Per Capita Personal Income
Per capita personal income information for Riverside County, the State of California and the United States
are summarized in the following table. Per capita personal income for the City is not available.
TABLE NO. C-2
PER CAPITA PERSONAL INCOME
RIVERSIDE COUNTY, STATE OF CALIFORNIA AND UNITED STATES
2014 – 2018
Year Riverside County (1) State of California (1) United States (1)
2014 $34,753 $52,324 $47,058
2015 36,642 55,758 48,978
2016 37,936 57,739 49,870
2017 38,975 60,156 51,885
2018 40,637 63,557 54,446
__________________________________
(1) For Riverside County, State of California and United States, per capita personal income was computed using
Census Bureau midyear population estimates. Estimates for 2010-2018 reflect county population estimates
available as of March 2019.
Note: All dollar estimates are in thousands of current dollars (not adjusted for inflation). Calculations are performed
on unrounded data.
Last updated: November 14, 2019, new statistics for 2018; revised statistics for 2014-2017.
Source: U.S. Department of Commerce, Bureau of Economic Analysis.
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125
C-3
Employment
As of July 2020, the civilian labor force for the City was approximately 19,400 of whom 16,500 were
employed. The unadjusted unemployment rate as of July 2020 was 15.0% for the City as compared to
13.7% for the County and 13.7% for the State. Civilian labor force, employment and unemployment
statistics for the City, County, the State and the nation, for the years 2015 through 2019 are shown in the
following table:
TABLE NO. C-3
CITY OF LA QUINTA
CIVILIAN LABOR FORCE, EMPLOYMENT AND UNEMPLOYMENT
ANNUAL AVERAGES
Civilian Unemployment
Year Labor Force Employment Unemployment Rate
2015
City of La Quinta 17,700 16,900 700 4.2%
Riverside County 1,033,300 964,100 69,200 6.7%
California 18,828,800 17,660,700 1,168,100 6.2%
United States 157,130,000 148,834,000 8,296,000 5.3%
2016
City of La Quinta 18,500 17,400 1,100 6.0%
Riverside County 1,051,400 987,200 64,200 6.1%
California 19,021,200 17,980,100 1,041,100 5.5%
United States 159,187,000 151,436,000 7,751,000 4.9%
2017
City of La Quinta 18,700 17,700 1,000 5.2%
Riverside County 1,072,200 1,015,800 56,300 5.3%
California 19,176,400 18,257,100 919,300 4.8%
United States 160,320,000 153,337,000 6,982,000 4.4%
2018
City of La Quinta 19,000 18,100 900 4.5%
Riverside County 1,091,400 1,042,700 48,700 4.5%
California 19,280,800 18,460,700 820,100 4.3%
United States 162,075,000 155,761,000 6,314,000 3.9%
2019
City of La Quinta 19,200 18,400 800 4.1%
Riverside County 1,104,000 1,057,900 46,100 4.2%
California 19,411,600 18,627,400 784,200 4.0%
United States 163,539,000 157,538,000 6,001,000 3.7%
__________________________________
Source: California State Employment Development Department and United States Bureau of Labor Statistics.
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C-4
Industry
The City is located in the Riverside-San Bernardino-Ontario Metropolitan Statistical Area (“MSA”). The
July 2020 unemployment rate in the Riverside-San Bernardino-Ontario MSA was 13.4%.
TABLE NO. C-4
RIVERSIDE-SAN BERNARDINO-ONTARIO MSA
WAGE AND SALARY WORKERS BY INDUSTRY (1)
(in thousands)
Industry 2016 2017 2018 2019 2020
Government 231.4 239.4 244.7 248.9 227.4
Other Services 44.4 45.7 45.6 46.1 35.2
Leisure and Hospitality 159.3 164.3 168.5 173.2 118.8
Educational and Health Services 212.8 223.3 237.4 248.2 242.4
Professional and Business Services 143.2 144.6 150.6 156.3 146.0
Financial Activities 44.5 43.8 43.7 44.4 43.0
Information 12.1 11.9 11.6 11.7 9.6
Transportation, Warehousing and Utilities 105.0 120.3 131.5 143.0 139.2
Service Producing
Retail Trade 176.2 178.6 178.6 179.4 161.3
Wholesale Trade 62.0 62.5 65.7 67.4 67.4
Manufacturing
Nondurable Goods 34.8 35.2 36.2 36.4 32.0
Durable Goods 64.8 64.2 65.3 65.2 59.6
Goods Producing
Construction 93.8 100.0 107.6 108.7 102.4
Mining and Logging 0.9 0.9 1.2 1.2 1.1
Total Nonfarm 1,385.2 1,434.7 1,488.2 1,530.1 1,385.4
Farm 14.3 15.8 16.0 17.4 15.3
Total (all industries) 1,399.5 1,450.5 1,504.2 1,547.5 1,400.7
__________________________________
(1) Annually, as of July.
Note: The unemployment rate is calculated using unrounded data. Data may not add due to rounding.
Source: State of California Employment Development Department, Labor Market Information Division, “Industry
Employment & Labor Force - by month, March 2019 Benchmark.”
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C-5
The major employers operating within the City and their respective number of employees as of June 30,
2019 are shown in Table No. C-5.
TABLE NO. C-5
CITY OF LA QUINTA
MAJOR EMPLOYERS
Name of Company Employment Type of Business/Service
Desert Sands Unified School District 2,852 Government
La Quinta Resort & Club/PGA West 1,412 Hotel & Golf Resort
Wal-Mart Super Center 300 Retailer
Costco 290 Retailer
Home Depot 212 Retailer
Target 180 Retailer
Lowe’s Home Improvement 150 Retailer
Imperial Irrigation District 134 Utility Company
In N Out 84 Fast Food Restaurant
Vons 83 Grocery Store
__________________________________
Source: City of La Quinta.
The City is not aware of any significant change since June 30, 2019 to the principal employers shown in
Table No. C-5, although some of the businesses listed may have been impacted by the stay at home orders
and/or roll back of re-openings and the City cannot guarantee that all of these businesses will continue to
operate in the City.
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128
C-6
Commercial Activity
Taxable transactions by type of business for the City of La Quinta for 2015 through 2019 (the most recent
year for which statistics are available from the Department of Tax and Fee Administration for the full year)
are summarized in Table No. C-6.
Taxable transactions for Fiscal Year 2019-20 and Fiscal Year 2020-21 have been impacted by the stay at
home orders and roll back of re-openings, and the Governor’s executive order relating to sales tax payments.
TABLE NO. C-6
CITY OF LA QUINTA
TAXABLE TRANSACTIONS BY TYPE OF BUSINESS
(in $ thousands)
2015 – 2019
2015 2016 2017 2018 2019
Clothing and Clothing
Accessories Stores $ 26,050 $ 27,251 $ 31,674 $ 34,403 $ 33,551
General Merchandise Stores 210,220 208,980 225,189 234,721 238,338
Food and Beverage Stores 41,302 38,719 43,161 44,919 45,149
Food Services and Drinking Places 107,831 119,503 120,479 125,483 135,565
Home Furnishings and
Appliance Stores 36,480 42,062 42,681 47,348 41,704
Building Materials and Garden
Equipment and Supplies 75,484 79,098 83,764 86,611 87,200
Motor Vehicles and Parts Dealers 85,507 79,626 77,503 78,878 82,406
Gasoline Stations 24,063 21,760 20,767 22,626 22,810
Other Retail Group 48,643 45,658 46,933 47,892 45,375
Total Retail and Food Services 655,580 662,657 692,151 722,881 732,098
All Other Outlets 84,042 92,574 93,982 105,161 107,563
Total All Outlets $739,622 $755,231 $786,133 $828,042 $839,661
_________________________________
Note: Detail may not compute to total due to rounding.
Source: California Department of Tax and Fee Administration, “Taxable Sales in California Cities, by Type of
Business.”
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129
C-7
Building Activity
The following table summarizes building activity valuations for the City of La Quinta for the five Fiscal
Years 2014-15 through 2018-19.
TABLE NO. C-7
CITY OF LA QUINTA
BUILDING ACTIVITY AND VALUATION
2014-15 - 2018-19
2014-15 2015-16 2016-17 2017-18 2018-19
Estimated Valuation
Building Permits Issued
__________________________________
Source: City of La Quinta.
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130
APPENDIX D
CITY AUDITED FINANCIAL STATEMENTS FOR THE FISCAL
YEAR ENDED JUNE 30, 2020
131
E-1
APPENDIX E
FORM OF CONTINUING DISCLOSURE AGREEMENT
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4828-5419-3868.3
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CONTINUING DISCLOSURE AGREEMENT
This Continuing Disclosure Agreement (the “Disclosure Agreement”), dated as of __________,
2021, is executed and delivered by the Successor Agency to the La Quinta Redevelopment Agency (the
“Successor Agency”) and Willdan Financial Services as dissemination agent (the “Dissemination
Agent”), in connection with the issuance of the $________ Successor Agency to the La Quinta
Redevelopment Agency, La Quinta Redevelopment Project Areas No. 1 and 2, Tax Allocation Refunding
Bonds, 2021 Taxable Series A (the “Bonds”). The Bonds are being issued pursuant to provisions of an
Indenture of Trust dated as of December 1, 2013, as supplemented including as supplemented by a Third
Supplemental Indenture of Trust, dated as of __________ 1, 2021 (collectively, the “Indenture”), by and
between the Successor Agency and U.S. Bank National Association, as trustee (the “Trustee”). The
Successor Agency and the Dissemination Agent covenant and agree as follows:
SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being
executed and delivered by the Successor Agency and the Dissemination Agent for the benefit of the
Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying with
S.E.C. Rule 15c2-12(b)(5).
SECTION 2. Definitions. In addition to the definitions set forth in the Indenture, which apply to
any capitalized term used in this Disclosure Agreement unless otherwise defined in this Section, the
following capitalized terms shall have the following meanings:
“Annual Report” shall mean any Annual Report or any addendum thereto provided by the
Successor Agency pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement.
“Beneficial Owner” shall mean any person which (a) has the power, directly or indirectly, to vote
or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds
through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for
federal income tax purposes.
“Disclosure Representative” shall mean the City Manager of the City or his or her designee, or
such other officer or employee as the City shall designate in writing to the Trustee and Dissemination
Agent from time to time.
“Dissemination Agent” shall mean Willdan Financial Services, acting in its capacity as
Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the
Successor Agency and which has filed with the Trustee a written acceptance of such designation.
“Listed Events” shall mean any of the events listed in Section 5(a) of this Disclosure Agreement.
“MSRB” shall mean the Municipal Securities Rulemaking Board established pursuant to
Section 15B(b)(1) of the Securities Exchange Act of 1934 or any other entity designated or authorized by
the Securities and Exchange Commission to receive reports pursuant to the Rule. Until otherwise
designated by the MSRB or the Securities and Exchange Commission, filings with the MSRB are to be
made through the Electronic Municipal Marketplace Access (EMMA) website of the MSRB, currently
located at http://emma.msrb.org.
“Official Statement” shall mean the final Official Statement, dated _______, 2021, relating to the
Bonds.
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“Participating Underwriter” shall mean any of the original underwriters of the Bonds required to
comply with the Rule in connection with offering of the Bonds.
“Rule” shall mean Rule 15c2-12(b)(5) adopted by the SEC under the Securities Exchange Act of
1934, as the same may be amended from time to time.
“SEC” shall mean the United States Securities and Exchange Commission.
“State” shall mean the State of California.
SECTION 3. Provision of Annual Reports.
(a) The Successor Agency shall, or shall cause the Dissemination Agent to, not later
than March 31 of each year, commencing March 31, 2022, provide to the MSRB and the Participating
Underwriter an Annual Report which is consistent with the requirements of Section 4 of this Disclosure
Agreement. The Annual Report may be submitted as a single document or as separate documents
comprising a package, and may include by reference other information as provided in Section 4 of this
Disclosure Agreement.
(b) Not later than fifteen days prior to the date specified in subsection (a) for
providing the Annual Report to the MSRB, the Successor Agency shall provide the Annual Report to the
Dissemination Agent. If by such date, the Dissemination Agent has not received a copy of the Annual
Report, the Dissemination Agent shall notify the Successor Agency of such failure to receive the Annual
Report. The Successor Agency shall provide a written certification with each Annual Report furnished to
the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to
be furnished by it hereunder. The Dissemination Agent may conclusively rely upon such certification of
the Successor Agency and shall have no duty or obligation to review such Annual Report.
(c) If the Dissemination Agent is unable to verify that an Annual Report has been
provided to the MSRB by the date required in subsection (a), the Dissemination Agent shall send a notice
to the MSRB in substantially the form attached as Exhibit A.
(d) The Dissemination Agent shall, to the extent information is known to it, file a
report with the Successor Agency and (if the Dissemination Agent is not the Trustee) the Trustee
certifying that the Annual Report has been provided pursuant to this Disclosure Agreement, stating the
date it was provided.
SECTION 4. Content of Annual Reports. The Successor Agency’s Annual Report shall contain
or include by reference the following (unless otherwise stated, such information shall be as of the end of
the most recent Fiscal Year and shall be with respect to the Successor Agency):
(i) A postaudit of the financial transactions and records of the Successor
Agency for the Fiscal Year to be made by an Independent Certified Public Accountant appointed by the
Successor Agency prepared in accordance with generally accepted accounting principles as promulgated
to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If
the Successor Agency’s postaudit is not available by the time the Annual Report is required to be filed
pursuant to Section 3(a), the Annual Report shall contain an unaudited statement of financial transactions
and records of the Successor Agency in a format required by Section 34177(n) of the Dissolution Act, and
the postaudit shall be filed in the same manner as the Annual Report when they become available.
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(ii) Financial information and operating data relating to the Project Areas for
the then current Fiscal Year contained in the following tables in the Official Statement
Table No. 1
Table No. 2
Table No. 3
Table No. 7
Table No. 8
(iii) An update of Table No. 10 in the Official Statement for the most recently
completed Fiscal Year.
(iv) A listing of the amount of each distribution from the Riverside County
Auditor-Controller of property tax revenues from the Redevelopment Property Tax Trust Fund received
by the Successor Agency for its enforceable obligations for the most recently completed Fiscal Year, as
reasonably available 15 days prior to the due date of each Annual Report.
Any or all of the items listed above may be included by specific reference to other documents,
including official statements of debt issues of the Successor Agency or related public entities, which are
available to the public on the MSRB’s EMMA Website or filed with the SEC.
SECTION 5. Reporting of Listed Events.
(a) Pursuant to the provisions of this section, upon the occurrence of any of the
following events (in each case to the extent applicable) with respect to the Bonds, the Successor Agency
shall give, or cause to be given by so notifying the Dissemination Agent in writing and instructing the
Dissemination Agent to give, notice of the occurrence of such event, in each case, pursuant to
Section 5(c) hereof:
1. principal or interest payment delinquencies;
2. non-payment related defaults, if material;
3. modifications to the rights of the Bondholders, if material;
4. optional, contingent or unscheduled calls, if material, and tender offers;
5. defeasances;
6. rating changes;
7. adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final
determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the Bonds or other
material events affecting the tax status of the Bonds;
8. unscheduled draws on the debt service reserves reflecting financial difficulties;
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9. unscheduled draws on the credit enhancements reflecting financial difficulties;
10. substitution of the credit or liquidity providers or their failure to perform;
11.release, substitution or sale of property securing repayment of the Bonds, if material;
12.bankruptcy, insolvency, receivership or similar proceedings of the Successor Agency,
which shall occur as described below;
13.appointment of a successor or additional trustee or the change of name of a trustee, if
material;
14.the consummation of a merger, consolidation, or acquisition involving the Successor
Agency or the sale of all or substantially all of the assets of the Successor Agency other
than in the ordinary course of business, the entry into a definitive agreement to undertake
such an action or the termination of a definitive agreement relating to any such actions,
other than pursuant to its terms, if material;
15.incurrence of a financial obligation of the Successor Agency, if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of a financial
obligation of the Successor Agency, any of which affect security holders, if material; or
16.default, event of acceleration, termination event, modification of terms, or other similar
events under the terms of a financial obligation of the Successor Agency, any of which
reflect financial difficulties.
For these purposes, any event described in item 12 of this Section 5(a) is considered to
occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar
officer for the Successor Agency in a proceeding under the United States Bankruptcy Code or in
any other proceeding under state or federal law in which a court or governmental authority has
assumed jurisdiction over substantially all of the assets or business of the Successor Agency, or if
such jurisdiction has been assumed by leaving the existing governing body and officials or
officers in possession but subject to the supervision and orders of a court or governmental
authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation
by a court or governmental authority having supervision or jurisdiction over substantially all of
the assets or business of the Successor Agency.
The term financial obligation means a (1) debt obligation; (2) derivative instrument
entered into in connection with, or pledged as security or a source of payment for, an existing or
planned debt obligation; or (3) guarantee of (e)(1) or (e)(2). The term financial obligation shall
not include municipal securities as to which a final official statement has been provided to the
MSRB consistent with the Rule.
(b) Upon receipt of notice from the Successor Agency and instruction by the
Successor Agency to report the occurrence of any Listed Event, the Dissemination Agent shall provide
notice thereof to the MSRB in accordance with Section 5(c) hereof. In the event the Dissemination Agent
shall obtain actual knowledge of the occurrence of any of the Listed Events, the Dissemination Agent
shall, immediately after obtaining such knowledge, contact the Disclosure Representative, inform such
person of the event, and request that the Successor Agency promptly notify the Dissemination Agent in
writing whether or not to report the event pursuant to Section 5(c). For purposes of this Disclosure
Agreement, “actual knowledge” of the occurrence of such Listed Event shall mean actual knowledge by
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the Dissemination Agent, if other than the Trustee, and if the Dissemination Agent is the Trustee, then by
the officer at the corporate trust office of the Trustee with regular responsibility for the administration of
matters related to the Indenture. The Dissemination Agent shall have no responsibility to determine the
materiality, if applicable, of any of the Listed Events.
(c) The Successor Agency, or the Dissemination Agent, if the Dissemination Agent
has been instructed by the Successor Agency to report the occurrence of a Listed Event, shall file a notice
of such occurrence with the MSRB in a timely manner not more than ten business days after the
occurrence of the event.
SECTION 6. Termination of Reporting Obligation. The Successor Agency’s obligations under
this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full
of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the Successor
Agency shall give notice of such termination in the same manner as for a Listed Event under Section 5(c).
SECTION 7. Dissemination Agent. The Successor Agency may, from time to time, appoint or
engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement,
and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination
Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or
report prepared by the Successor Agency pursuant to this Disclosure Agreement. The initial
Dissemination Agent shall be Willdan Financial Services. The Dissemination Agent may resign by
providing thirty days’ written notice to the Successor Agency and the Trustee. The Dissemination Agent
shall not be responsible for the content of any report or notice prepared by the Successor Agency. The
Dissemination Agent shall have no duty to prepare any information report nor shall the Dissemination
Agent be responsible for filing any report not provided to it by the Successor Agency in a timely manner
and in a form suitable for filing.
SECTION 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure
Agreement, the Successor Agency and the Dissemination Agent may amend this Disclosure Agreement
(and the Dissemination Agent shall agree to any amendment so requested by the Successor Agency)
provided, the Dissemination Agent shall not be obligated to enter into any such amendment that modifies
or increases its duties or obligations hereunder, and any provision of this Disclosure Agreement may be
waived, provided that in the opinion of nationally recognized bond counsel, such amendment or waiver is
permitted by the Rule. In the event of any amendment or waiver of a provision of this Disclosure
Agreement, the Successor Agency shall describe such amendment in the next Annual Report, and shall
include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact
on the type (or, in the case of a change of accounting principles, on the presentation) of financial
information or operating data being presented by the Successor Agency.
SECTION 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to
prevent the Successor Agency from disseminating any other information, using the means of
dissemination set forth in this Disclosure Agreement or any other means of communication, or including
any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that
which is required by this Disclosure Agreement. If the Successor Agency chooses to include any
information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is
specifically required by this Disclosure Agreement, the Successor Agency shall have no obligation under
this Disclosure Agreement to update such information or include it in any future Annual Report or notice
of occurrence of a Listed Event.
SECTION 10. Filings with the MSRB. All financial information, operating data, financial
statements, notices, and other documents provided to the MSRB in accordance with this Disclosure
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Agreement shall be provided in an electronic format prescribed by the MSRB and shall be accompanied
by identifying information as prescribed by the MSRB.
SECTION 11. Default. In the event of a failure of the Successor Agency to comply with any
provision of this Disclosure Agreement, the Trustee (at the written request of any Participating
Underwriter or the holders of at least 25% aggregate principal amount of Outstanding Bonds, shall, but
only to the extent funds in an amount satisfactory to the Trustee have been provided to it or it has been
otherwise indemnified to its satisfaction from any cost, liability, expense or additional charges and fees of
the Trustee whatsoever, including, without limitation, fees and expenses of its attorneys), or any holder or
Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including
seeking mandate or specific performance by court order, to cause the Successor Agency or the
Dissemination Agent, as the case may be, to comply with its obligations under this Disclosure
Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under
the Indenture, and the sole remedy under this Disclosure Agreement in the event of any failure of the
Successor Agency or the Dissemination Agent to comply with this Disclosure Agreement shall be an
action to compel performance.
SECTION 12. Duties, Immunities and Liabilities of Trustee and Dissemination Agent.
Article VIII of the Indenture pertaining to the Trustee is hereby made applicable to this Disclosure
Agreement as if this Disclosure Agreement were (solely for this purpose) contained in the Indenture and
the Trustee and Dissemination Agent shall be entitled to the protections, limitations from liability and
indemnities afforded the Trustee thereunder. The Dissemination Agent and the Trustee shall have only
such duties as are specifically set forth in this Disclosure Agreement, and the Successor Agency agrees to
indemnify and save the Dissemination Agent and Trustee, their officers, directors, employees and agents,
harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or
performance of its powers and duties hereunder, including the costs and expenses (including attorneys’
fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s
or Trustee’s respective negligence or willful misconduct. The Dissemination Agent shall be paid
compensation by the Successor Agency for its services provided hereunder in accordance with its
schedule of fees as amended from time to time and all expenses, legal fees and advances made or incurred
by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent and the
Trustee shall have no duty or obligation to review any information provided to them hereunder and shall
not be deemed to be acting in any fiduciary capacity for the Successor Agency, the Bondholders, or any
other party. Neither the Trustee nor the Dissemination Agent shall have any liability to the Bondholders
or any other party for any monetary damages or financial liability of any kind whatsoever related to or
arising from this Disclosure Agreement. The obligations of the Successor Agency under this
Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.
SECTION 13. Notices. Any notices or communications to or among any of the parties to this
Disclosure Agreement may be given as follows:
To the Successor Agency: Successor Agency to the La Quinta
Redevelopment Agency
78-495 Calle Tampico
La Quinta, CA 92253
Attn: Executive Director
Phone: (760) 777-7030
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To the Dissemination Agent: Willdan Financial Services
27368 Via Industria, Suite 200
Temecula, California 92590
Attn: Disclosure Group
Phone: (951) 587-3500
To the Trustee: U.S. Bank, National Association
633 West Fifth Street, 24th Floor
Los Angeles, California 90071
Attention: Corporate Trust Services
Phone: (213) 615-6047
Any person may, by written notice to the other persons listed above, designate a different address or
telephone number(s) to which subsequent notices or communications should be sent.
SECTION 14. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the
Successor Agency, the Trustee, the Dissemination Agent, the Participating Underwriter and holders and
Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.
SECTION 15. Counterparts. This Disclosure Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall constitute but one and the same
instrument.
SUCCESSOR AGENCY TO THE LA QUINTA
REDEVELOPMENT AGENCY
By
Executive Director
WILLDAN FINANCIAL SERVICES,
as Dissemination Agent
By
Authorized Representative
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EXHIBIT A
NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT
Name of Obligated Party: Successor Agency to La Quinta Redevelopment Agency
Name of Bond Issue: Successor Agency to La Quinta Redevelopment Agency, Redevelopment
Project Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2021 Taxable
Series A
Date of Issuance: __________, 2021
NOTICE IS HEREBY GIVEN that the Successor Agency has not provided an Annual Report
with respect to the above-named Bonds as required by the Continuing Disclosure Agreement, dated as of
_________, 2021, with respect to the Bonds. [The Successor Agency anticipates that the Annual Report
will be filed by ___________________________.]
Dated:
WILLDAN FINANCIAL SERVICES., on behalf of the
Successor Agency
cc: Successor Agency
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APPENDIX F
PROPOSED FORM OF BOND COUNSEL OPINION
[TO BE PROVIDED BY BOND COUNSEL]
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APPENDIX G
THE BOOK-ENTRY SYSTEM
The following description of the Depository Trust Company (“DTC”), the procedures and record
keeping with respect to beneficial ownership interests in the Bonds, payment of principal, interest and other
payments on the Bonds to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial
ownership interest in the Bonds and other related transactions by and between DTC, the DTC Participants
and the Beneficial Owners is based solely on information provided by DTC. Accordingly, no
representations can be made concerning these matters and neither the DTC Participants nor the Beneficial
Owners should rely on the foregoing information with respect to such matters, but should instead confirm
the same with DTC or the DTC Participants, as the case may be.
Neither the issuer of the Bonds (the “Issuer”) nor the trustee, fiscal agent or paying agent
appointed with respect to the Bonds (the “Agent”) take any responsibility for the information contained in
this Appendix.
No assurances can be given that DTC, DTC Participants or Indirect Participants will distribute to
the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the Bonds, (b)
certificates representing ownership interest in or other confirmation or ownership interest in the Bonds, or
(c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the
Bonds, or that they will so do on a timely basis, or that DTC, DTC Participants or DTC Indirect Participants
will act in the manner described in this Appendix. The current “Rules” applicable to DTC are on file with
the Securities and Exchange Commission and the current “Procedures” of DTC to be followed in dealing
with DTC Participants are on file with DTC.
1. The Depository Trust Company (“DTC”), New York, NY, will act as securities depository
for the securities (the “Securities”). The Securities will be issued as fully-registered securities registered in
the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an
authorized representative of DTC. One fully-registered Security certificate will be issued for each issue of
the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. If,
however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued
with respect to each $500 million of principal amount, and an additional certificate will be issued with
respect to any remaining principal amount of such issue.
2. DTC, the world’s largest securities depository, is a limited-purpose trust company
organized under the New York Banking Law, a “banking organization” within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the
New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of
Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5
million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market
instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC.
DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities
transactions in deposited securities, through electronic computerized book-entry transfers and pledges
between Direct Participants’ accounts. This eliminates the need for physical movement of securities
certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust
companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of
The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National
Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered
clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is
also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust
companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of
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AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange
Commission. More information about DTC can be found at www.dtcc.com. The information contained on
such Internet site is not incorporated herein by reference.
3. Purchases of Securities under the DTC system must be made by or through Direct
Participants, which will receive a credit for the Securities on DTC’s records. The ownership interest of
each actual purchaser of each Security (“Beneficial Owner”) is in turn to be recorded on the Direct and
Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their
purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of
the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant
through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the
Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting
on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their
ownership interests in Securities, except in the event that use of the book-entry system for the Securities is
discontinued.
4.To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC
are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be
requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration
in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership.
DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC’s records reflect only the
identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be
the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of
their holdings on behalf of their customers.
5.Conveyance of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements
as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to
augment the transmission to them of notices of significant events with respect to the Securities, such as
redemptions, tenders, defaults, and proposed amendments to the Security documents. For example,
Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their
benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial
Owners may wish to provide their names and addresses to the registrar and request that copies of notices
be provided directly to them.
6.Redemption notices shall be sent to DTC. If less than all of the Securities within an issue
are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct
Participant in such issue to be redeemed.
7.Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with
respect to Securities unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures.
Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as soon as possible after the record
date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to
whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus
Proxy).
8.Redemption proceeds, distributions, and dividend payments on the Securities will be made
to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s
practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail
information from Issuer or Agent, on payable date in accordance with their respective holdings shown on
DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions
and customary practices, as is the case with securities held for the accounts of customers in bearer form or
registered in “street name,” and will be the responsibility of such Participant and not of DTC, Agent, or
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Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment
of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as
may be requested by an authorized representative of DTC) is the responsibility of Issuer or Agent,
disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement
of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.
9.DTC may discontinue providing its services as depository with respect to the Securities at
any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a
successor depository is not obtained, Security certificates are required to be printed and delivered.
10. Issuer may decide to discontinue use of the system of book-entry transfers through DTC
(or a successor securities depository). In that event, Security certificates will be printed and delivered to
DTC.
11. The information in this section concerning DTC and DTC’s book-entry system has been
obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy
thereof.
[Remainder of Page Intentionally Left Blank]
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CONTINUING DISCLOSURE AGREEMENT
This Continuing Disclosure Agreement (the “Disclosure Agreement”), dated as of __________,
2021, is executed and delivered by the Successor Agency to the La Quinta Redevelopment Agency (the
“Successor Agency”) and Willdan Financial Services as dissemination agent (the “Dissemination Agent”),
in connection with the issuance of the $________ Successor Agency to the La Quinta Redevelopment
Agency, La Quinta Redevelopment Project Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2021
Taxable Series A (the “Bonds”). The Bonds are being issued pursuant to provisions of an Indenture of
Trust dated as of December 1, 2013, as supplemented including as supplemented by a Third Supplemental
Indenture of Trust, dated as of __________ 1, 2021 (collectively, the “Indenture”), by and between the
Successor Agency and U.S. Bank National Association, as trustee (the “Trustee”). The Successor Agency
and the Dissemination Agent covenant and agree as follows:
SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed
and delivered by the Successor Agency and the Dissemination Agent for the benefit of the Beneficial
Owners of the Bonds and in order to assist the Participating Underwriter in complying with S.E.C.
Rule 15c2-12(b)(5).
SECTION 2. Definitions. In addition to the definitions set forth in the Indenture, which apply to
any capitalized term used in this Disclosure Agreement unless otherwise defined in this Section, the
following capitalized terms shall have the following meanings:
“Annual Report” shall mean any Annual Report or any addendum thereto provided by the
Successor Agency pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement.
“Beneficial Owner” shall mean any person which (a) has the power, directly or indirectly, to vote
or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds
through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for
federal income tax purposes.
“Disclosure Representative” shall mean the City Manager of the City or his or her designee, or such
other officer or employee as the City shall designate in writing to the Trustee and Dissemination Agent
from time to time.
“Dissemination Agent” shall mean Willdan Financial Services, acting in its capacity as
Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the
Successor Agency and which has filed with the Trustee a written acceptance of such designation.
“Listed Events” shall mean any of the events listed in Section 5(a) of this Disclosure Agreement.
“MSRB” shall mean the Municipal Securities Rulemaking Board established pursuant to
Section 15B(b)(1) of the Securities Exchange Act of 1934 or any other entity designated or authorized by
the Securities and Exchange Commission to receive reports pursuant to the Rule. Until otherwise
designated by the MSRB or the Securities and Exchange Commission, filings with the MSRB are to be
made through the Electronic Municipal Marketplace Access (EMMA) website of the MSRB, currently
located at http://emma.msrb.org.
“Official Statement” shall mean the final Official Statement, dated _______, 2021, relating to the
Bonds.
ATTACHMENT 4
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“Participating Underwriter” shall mean any of the original underwriters of the Bonds required to
comply with the Rule in connection with offering of the Bonds.
“Rule” shall mean Rule 15c2-12(b)(5) adopted by the SEC under the Securities Exchange Act of
1934, as the same may be amended from time to time.
“SEC” shall mean the United States Securities and Exchange Commission.
“State” shall mean the State of California.
SECTION 3. Provision of Annual Reports.
(a) The Successor Agency shall, or shall cause the Dissemination Agent to, not later
than March 31 of each year, commencing March 31, 2022, provide to the MSRB and the Participating
Underwriter an Annual Report which is consistent with the requirements of Section 4 of this Disclosure
Agreement. The Annual Report may be submitted as a single document or as separate documents
comprising a package, and may include by reference other information as provided in Section 4 of this
Disclosure Agreement.
(b) Not later than fifteen days prior to the date specified in subsection (a) for providing
the Annual Report to the MSRB, the Successor Agency shall provide the Annual Report to the
Dissemination Agent. If by such date, the Dissemination Agent has not received a copy of the Annual
Report, the Dissemination Agent shall notify the Successor Agency of such failure to receive the Annual
Report. The Successor Agency shall provide a written certification with each Annual Report furnished to
the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be
furnished by it hereunder. The Dissemination Agent may conclusively rely upon such certification of the
Successor Agency and shall have no duty or obligation to review such Annual Report.
(c) If the Dissemination Agent is unable to verify that an Annual Report has been
provided to the MSRB by the date required in subsection (a), the Dissemination Agent shall send a notice
to the MSRB in substantially the form attached as Exhibit A.
(d) The Dissemination Agent shall, to the extent information is known to it, file a
report with the Successor Agency and (if the Dissemination Agent is not the Trustee) the Trustee certifying
that the Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it was
provided.
SECTION 4. Content of Annual Reports. The Successor Agency’s Annual Report shall contain
or include by reference the following (unless otherwise stated, such information shall be as of the end of
the most recent Fiscal Year and shall be with respect to the Successor Agency):
(i) A postaudit of the financial transactions and records of the Successor
Agency for the Fiscal Year to be made by an Independent Certified Public Accountant appointed by the
Successor Agency prepared in accordance with generally accepted accounting principles as promulgated to
apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the
Successor Agency’s postaudit is not available by the time the Annual Report is required to be filed pursuant
to Section 3(a), the Annual Report shall contain an unaudited statement of financial transactions and records
of the Successor Agency in a format required by Section 34177(n) of the Dissolution Act, and the postaudit
shall be filed in the same manner as the Annual Report when they become available.
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(ii) Financial information and operating data relating to the Project Areas for
the then current Fiscal Year contained in the following tables in the Official Statement
Table No. 1
Table No. 2
Table No. 3
Table No. 7
Table No. 8
(iii) An update of Table No. 10 in the Official Statement for the most recently
completed Fiscal Year.
(iv) A listing of the amount of each distribution from the Riverside County
Auditor-Controller of property tax revenues from the Redevelopment Property Tax Trust Fund received by
the Successor Agency for its enforceable obligations for the most recently completed Fiscal Year, as
reasonably available 15 days prior to the due date of each Annual Report.
Any or all of the items listed above may be included by specific reference to other documents,
including official statements of debt issues of the Successor Agency or related public entities, which are
available to the public on the MSRB’s EMMA Website or filed with the SEC.
SECTION 5. Reporting of Listed Events.
(a) Pursuant to the provisions of this section, upon the occurrence of any of the
following events (in each case to the extent applicable) with respect to the Bonds, the Successor Agency
shall give, or cause to be given by so notifying the Dissemination Agent in writing and instructing the
Dissemination Agent to give, notice of the occurrence of such event, in each case, pursuant to Section 5(c)
hereof:
1. principal or interest payment delinquencies;
2. non-payment related defaults, if material;
3. modifications to the rights of the Bondholders, if material;
4. optional, contingent or unscheduled calls, if material, and tender offers;
5. defeasances;
6. rating changes;
7. adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final
determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the Bonds or other
material events affecting the tax status of the Bonds;
8. unscheduled draws on the debt service reserves reflecting financial difficulties;
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9. unscheduled draws on the credit enhancements reflecting financial difficulties;
10. substitution of the credit or liquidity providers or their failure to perform;
11. release, substitution or sale of property securing repayment of the Bonds, if material;
12. bankruptcy, insolvency, receivership or similar proceedings of the Successor Agency,
which shall occur as described below;
13. appointment of a successor or additional trustee or the change of name of a trustee, if
material;
14. the consummation of a merger, consolidation, or acquisition involving the Successor
Agency or the sale of all or substantially all of the assets of the Successor Agency other
than in the ordinary course of business, the entry into a definitive agreement to undertake
such an action or the termination of a definitive agreement relating to any such actions,
other than pursuant to its terms, if material;
15. incurrence of a financial obligation of the Successor Agency, if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of a financial
obligation of the Successor Agency, any of which affect security holders, if material; or
16. default, event of acceleration, termination event, modification of terms, or other similar
events under the terms of a financial obligation of the Successor Agency, any of which
reflect financial difficulties.
For these purposes, any event described in item 12 of this Section 5(a) is considered to
occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar
officer for the Successor Agency in a proceeding under the United States Bankruptcy Code or in
any other proceeding under state or federal law in which a court or governmental authority has
assumed jurisdiction over substantially all of the assets or business of the Successor Agency, or if
such jurisdiction has been assumed by leaving the existing governing body and officials or officers
in possession but subject to the supervision and orders of a court or governmental authority, or the
entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or
governmental authority having supervision or jurisdiction over substantially all of the assets or
business of the Successor Agency.
The term financial obligation means a (1) debt obligation; (2) derivative instrument entered
into in connection with, or pledged as security or a source of payment for, an existing or planned
debt obligation; or (3) guarantee of (e)(1) or (e)(2). The term financial obligation shall not include
municipal securities as to which a final official statement has been provided to the MSRB consistent
with the Rule.
(b) Upon receipt of notice from the Successor Agency and instruction by the Successor
Agency to report the occurrence of any Listed Event, the Dissemination Agent shall provide notice thereof
to the MSRB in accordance with Section 5(c) hereof. In the event the Dissemination Agent shall obtain
actual knowledge of the occurrence of any of the Listed Events, the Dissemination Agent shall, immediately
after obtaining such knowledge, contact the Disclosure Representative, inform such person of the event,
and request that the Successor Agency promptly notify the Dissemination Agent in writing whether or not
to report the event pursuant to Section 5(c). For purposes of this Disclosure Agreement, “actual
knowledge” of the occurrence of such Listed Event shall mean actual knowledge by the Dissemination
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Agent, if other than the Trustee, and if the Dissemination Agent is the Trustee, then by the officer at the
corporate trust office of the Trustee with regular responsibility for the administration of matters related to
the Indenture. The Dissemination Agent shall have no responsibility to determine the materiality, if
applicable, of any of the Listed Events.
(c) The Successor Agency, or the Dissemination Agent, if the Dissemination Agent
has been instructed by the Successor Agency to report the occurrence of a Listed Event, shall file a notice
of such occurrence with the MSRB in a timely manner not more than ten business days after the occurrence
of the event.
SECTION 6. Termination of Reporting Obligation. The Successor Agency’s obligations under
this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full
of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the Successor
Agency shall give notice of such termination in the same manner as for a Listed Event under Section 5(c).
SECTION 7. Dissemination Agent. The Successor Agency may, from time to time, appoint or
engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement,
and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination
Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or
report prepared by the Successor Agency pursuant to this Disclosure Agreement. The initial Dissemination
Agent shall be Willdan Financial Services. The Dissemination Agent may resign by providing thirty days’
written notice to the Successor Agency and the Trustee. The Dissemination Agent shall not be responsible
for the content of any report or notice prepared by the Successor Agency. The Dissemination Agent shall
have no duty to prepare any information report nor shall the Dissemination Agent be responsible for filing
any report not provided to it by the Successor Agency in a timely manner and in a form suitable for filing.
SECTION 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure
Agreement, the Successor Agency and the Dissemination Agent may amend this Disclosure Agreement
(and the Dissemination Agent shall agree to any amendment so requested by the Successor Agency)
provided, the Dissemination Agent shall not be obligated to enter into any such amendment that modifies
or increases its duties or obligations hereunder, and any provision of this Disclosure Agreement may be
waived, provided that in the opinion of nationally recognized bond counsel, such amendment or waiver is
permitted by the Rule. In the event of any amendment or waiver of a provision of this Disclosure
Agreement, the Successor Agency shall describe such amendment in the next Annual Report, and shall
include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on
the type (or, in the case of a change of accounting principles, on the presentation) of financial information
or operating data being presented by the Successor Agency.
SECTION 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to
prevent the Successor Agency from disseminating any other information, using the means of dissemination
set forth in this Disclosure Agreement or any other means of communication, or including any other
information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is
required by this Disclosure Agreement. If the Successor Agency chooses to include any information in any
Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required
by this Disclosure Agreement, the Successor Agency shall have no obligation under this Disclosure
Agreement to update such information or include it in any future Annual Report or notice of occurrence of
a Listed Event.
SECTION 10. Filings with the MSRB. All financial information, operating data, financial
statements, notices, and other documents provided to the MSRB in accordance with this Disclosure
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Agreement shall be provided in an electronic format prescribed by the MSRB and shall be accompanied by
identifying information as prescribed by the MSRB.
SECTION 11. Default. In the event of a failure of the Successor Agency to comply with any
provision of this Disclosure Agreement, the Trustee (at the written request of any Participating Underwriter
or the holders of at least 25% aggregate principal amount of Outstanding Bonds, shall, but only to the extent
funds in an amount satisfactory to the Trustee have been provided to it or it has been otherwise indemnified
to its satisfaction from any cost, liability, expense or additional charges and fees of the Trustee whatsoever,
including, without limitation, fees and expenses of its attorneys), or any holder or Beneficial Owner of the
Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific
performance by court order, to cause the Successor Agency or the Dissemination Agent, as the case may
be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure
Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this
Disclosure Agreement in the event of any failure of the Successor Agency or the Dissemination Agent to
comply with this Disclosure Agreement shall be an action to compel performance.
SECTION 12. Duties, Immunities and Liabilities of Trustee and Dissemination Agent.
Article VIII of the Indenture pertaining to the Trustee is hereby made applicable to this Disclosure
Agreement as if this Disclosure Agreement were (solely for this purpose) contained in the Indenture and
the Trustee and Dissemination Agent shall be entitled to the protections, limitations from liability and
indemnities afforded the Trustee thereunder. The Dissemination Agent and the Trustee shall have only
such duties as are specifically set forth in this Disclosure Agreement, and the Successor Agency agrees to
indemnify and save the Dissemination Agent and Trustee, their officers, directors, employees and agents,
harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or
performance of its powers and duties hereunder, including the costs and expenses (including attorneys’
fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s
or Trustee’s respective negligence or willful misconduct. The Dissemination Agent shall be paid
compensation by the Successor Agency for its services provided hereunder in accordance with its schedule
of fees as amended from time to time and all expenses, legal fees and advances made or incurred by the
Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent and the Trustee
shall have no duty or obligation to review any information provided to them hereunder and shall not be
deemed to be acting in any fiduciary capacity for the Successor Agency, the Bondholders, or any other
party. Neither the Trustee nor the Dissemination Agent shall have any liability to the Bondholders or any
other party for any monetary damages or financial liability of any kind whatsoever related to or arising from
this Disclosure Agreement. The obligations of the Successor Agency under this Section shall survive
resignation or removal of the Dissemination Agent and payment of the Bonds.
SECTION 13. Notices. Any notices or communications to or among any of the parties to this
Disclosure Agreement may be given as follows:
To the Successor Agency: Successor Agency to the La Quinta
Redevelopment Agency
78-495 Calle Tampico
La Quinta, CA 92253
Attn: Executive Director
Phone: (760) 777-7030
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4828-5419-3868.3
- 7 -
To the Dissemination Agent: Willdan Financial Services
27368 Via Industria, Suite 200
Temecula, California 92590
Attn: Disclosure Group
Phone: (951) 587-3500
To the Trustee: U.S. Bank, National Association
633 West Fifth Street, 24th Floor
Los Angeles, California 90071
Attention: Corporate Trust Services
Phone: (213) 615-6047
Any person may, by written notice to the other persons listed above, designate a different address or
telephone number(s) to which subsequent notices or communications should be sent.
SECTION 14. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the
Successor Agency, the Trustee, the Dissemination Agent, the Participating Underwriter and holders and
Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.
SECTION 15. Counterparts. This Disclosure Agreement may be executed in several counterparts,
each of which shall be an original and all of which shall constitute but one and the same instrument.
SUCCESSOR AGENCY TO THE LA QUINTA
REDEVELOPMENT AGENCY
By
Executive Director
WILLDAN FINANCIAL SERVICES,
as Dissemination Agent
By
Authorized Representative
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4828-5419-3868.3
- 8 -
EXHIBIT A
NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT
Name of Obligated Party: Successor Agency to La Quinta Redevelopment Agency
Name of Bond Issue: Successor Agency to La Quinta Redevelopment Agency, Redevelopment
Project Areas No. 1 and 2, Tax Allocation Refunding Bonds, 2021 Taxable
Series A
Date of Issuance: __________, 2021
NOTICE IS HEREBY GIVEN that the Successor Agency has not provided an Annual Report with
respect to the above-named Bonds as required by the Continuing Disclosure Agreement, dated as of
_________, 2021, with respect to the Bonds. [The Successor Agency anticipates that the Annual Report
will be filed by ___________________________.]
Dated:
WILLDAN FINANCIAL SERVICES., on behalf of the
Successor Agency
cc: Successor Agency
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ESCROW AGREEMENT
THIS ESCROW AGREEMENT, dated as of _______ 1, 2021 (this “Agreement”), is by
and between the Successor Agency to the La Quinta Redevelopment Agency (the “Successor
Agency”), and U.S. Bank National Association, acting in its capacity as escrow bank (the “Escrow
Bank”) pursuant to this Agreement;
W I T N E S S E T H:
WHEREAS, the La Quinta Redevelopment Agency (the “Prior Agency”) was a public
body, corporate and politic, duly created, established and authorized to transact business and
exercise its powers under and pursuant to the provisions of the Community Redevelopment Law
(Part 1 of Division 24 (commencing with Section 33000) of the Health and Safety Code of the
State of California) (the “Law”), and the powers of the Prior Agency included the power to issue
bonds for any of its corporate purposes; and
WHEREAS, Assembly Bill AB X1 26, effective June 29, 2011, together with Assembly
Bill 1484 (collectively, the “Dissolution Act”) resulted in the Prior Agency being dissolved as of
February 1, 2012; and
WHEREAS, the authority, rights, powers, assets, duties and obligations of the Prior
Agency were transferred on February 1, 2012 to the Successor Agency; and
WHEREAS, the Successor Agency previously issued $97,190,000 aggregate principal
amount of the Successor Agency to the La Quinta Redevelopment Agency, La Quinta
Redevelopment Project Area Nos. 1 and 2, Subordinate Tax Allocation Refunding Bonds, 2013
Series A (the “2013 Series A Bonds”) pursuant to an Indenture of Trust and a First Supplemental
Indenture of Trust each dated as of December 1, 2013 (collectively the “Original Indenture”); and
WHEREAS, the Successor Agency previously issued $23,055,000 aggregate principal
amount of the Successor Agency to the La Quinta Redevelopment Agency, La Quinta
Redevelopment Project Area Nos. 1 and 2, Subordinate Tax Allocation Refunding Bonds, 2013
Taxable Series B (the “2013 Series B Bonds,” and together with the 2013 Series A Bonds, the
“2013 Bonds”) pursuant to the Original Indenture; and
WHEREAS, the Successor Agency previously issued $65,600,000 aggregate principal
amount of the Successor Agency to the La Quinta Redevelopment Agency, La Quinta
Redevelopment Project Area Nos. 1 and 2, Tax Allocation Refunding Bonds, 2014 Series A (the
“2014 Bonds,” and together with the 2013 Bonds, the “Refunded Bonds”) pursuant to an Indenture
of Trust dated as of June 1, 2014 (the “2014 Indenture”); and
WHEREAS, for the corporate purposes of the Successor Agency, the Successor Agency
deems it necessary to issue at this time tax allocation refunding bonds in a principal amount
__________ Million _________ Thousand Dollars ($__________) (the “Bonds”), and to
irrevocably set aside a portion of the proceeds of such Bonds in a separate segregated trust fund
which will be used to refund the outstanding 2013 Bonds and 2014 Bonds of the Successor
Agency; and
ATTACHMENT 5
154
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the Successor Agency and the Escrow Bank agree as follows:
SECTION 1. Deposit of Moneys.
(a) The Successor Agency hereby deposits with the Escrow Bank $__________
of Bond proceeds and monies from the 2013 Bonds Funds and Accounts set forth below to be held
in irrevocable escrow by the Escrow Bank separate and apart from other funds of the Successor
Agency and the Escrow Bank in a fund hereby created and established and to be known as the
“2013 Escrow Fund”, and to be applied solely as provided in this Agreement. Such moneys in the
amount of $________ shall be invested in Federal Securities and $__________ shall be held in
uninvested cash as provided in Schedule B herein.
(b) The Successor Agency hereby deposits with the Escrow Bank $__________
of Bond proceeds and monies from the 2014 Bonds Funds and Accounts set forth below to be held
in irrevocable escrow by the Escrow Bank separate and apart from other funds of the Successor
Agency and the Escrow Bank in a fund hereby created and established and to be known as the
“2014 Escrow Fund”, and to be applied solely as provided in this Agreement. Such moneys in the
amount of $_______ shall be invested in Federal Securities and $__________ shall be held in
uninvested cash as provided in Schedule B herein.
(c) The Escrow Bank hereby acknowledges receipt of the written opinion of
______, a firm of independent public accountants, dated _____________, 2021, relating to the
sufficiency of the cash deposited pursuant hereto to defease the 2013 Bonds and the 2014 Bonds
(the “Verification Report”), and the opinion of Rutan & Tucker, LLP, dated _____________,
2021, relating to this Agreement.
SECTION 2. Use and Investment of Moneys. The Escrow Bank acknowledges receipt
of the moneys described in Section 1 and agrees:
(a) such moneys in an amount equal to $__________ in Federal Securities and
$__________ held in uninvested cash shall be held for the purpose of defeasing the 2013 Bonds;
and
(b) such moneys in an amount equal to $__________ in Federal Securities and
$__________ held in uninvested cash shall be held for the purpose of defeasing the 2014 Bonds;
and
(c) to make the payments required under Section 3(a) hereof at the times set
forth in Section 3(a) hereof.
SECTION 3. Payment of 2013 Bonds and 2014 Bonds.
(a) Payment. (i) The Escrow Bank shall transfer from the 2013 Escrow Fund
to the paying agent for the 2013 Bonds (the “2013 Paying Agent”) amounts sufficient to pay the
principal of and interest on the 2013 Bonds when due to and including September 1, 2023 and the
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redemption price of the 2013 Bonds on September 1, 2023 as shown on Schedule A. Such transfers
shall constitute the respective payments of the principal of and interest on the 2013 Bonds and
redemption price due from the Successor Agency.
(ii) The Escrow Bank shall transfer from the 2014 Escrow Fund to the paying agent for the 2014
Bonds (the “2014 Paying Agent”) amounts sufficient to pay the principal of and interest on the
2014 Bonds when due to and including September 1, 2024 and the redemption price of the 2014
Bonds on September 1, 2024 as shown on Schedule A. Such transfers shall constitute the
respective payments of the principal of and interest on the 2014 Bonds and redemption price due
from the Successor Agency.
(b) Unclaimed Moneys. Any moneys remaining in the 2013 Escrow Fund
established hereunder after September 2, 2023 (aside from unclaimed monies) of the 2013 Bonds
which are in excess of the amount needed to pay owners of the 2013 Bonds payments of principal
and interest and redemption premium, if any, with respect to the 2013 Bonds or to pay any amounts
owed to the Escrow Bank shall be immediately transferred by the Escrow Bank to the Successor
Agency and deposited by the Successor Agency in the Debt Service Fund relating to the Bonds.
Any moneys remaining in the 2014 Escrow Fund established hereunder after September 2, 2024
(aside from unclaimed monies) of the 2014 Bonds which are in excess of the amount needed to
pay owners of the 2014 Bonds payments of principal and interest and redemption premium, if any,
with respect to the 2014 Bonds or to pay any amounts owed to the Escrow Bank shall be
immediately transferred by the Escrow Bank to the Successor Agency and deposited by the
Successor Agency in the Debt Service Fund relating to the Bonds.
(c) Priority of Payments. The holders of the 2013 Bonds shall have a first lien
on the moneys in the 2013 Escrow Fund which are allowable and sufficient to pay the 2013 Bonds
until such moneys are used and applied as provided in this Agreement, as verified by the
Verification Report. Any cash or securities held in the 2013 Escrow Fund are irrevocably pledged
only to the holders of the 2013 Bonds. The holders of the 2014 Bonds shall have a first lien on the
moneys in the 2014 Escrow Fund which are allowable and sufficient to pay the 2014 Bonds until
such moneys are used and applied as provided in this Agreement, as verified by the Verification
Report. Any cash or securities held in the 2014 Escrow Fund are irrevocably pledged only to the
holders of the 2014 Bonds.
(d) Termination of Obligation. Upon deposit of the moneys set forth in Section
1 hereof with the Escrow Bank pursuant to the provisions of Section 1 hereof, all obligations of
the Successor Agency with respect to the 2013 Bonds and the 2014 Bonds shall cease and
terminate, except only the obligation to make payments therefor from the moneys provided for
hereunder, and the owners of the 2013 Bonds and the 2014 Bonds shall cease to be entitled to any
lien, benefit or security relating to the 2013 Bonds and the 2014 Bonds.
SECTION 4. Performance of Duties. The Escrow Bank agrees to perform the duties
set forth herein.
SECTION 5. Reinvestment. Upon written direction of the Successor Agency, the
Escrow Bank may reinvest any uninvested amounts held as cash under this Agreement in
noncallable nonprepayable obligations which are direct obligations issued by the United States
156
Treasury or obligations which are unconditionally guaranteed as to full and timely payment by the
United States of America provided (i) the amounts of and dates on which the anticipated transfers
from the 2013 Escrow Fund to the Paying Agent for the payment of the principal of, redemption
price of, and interest on the 2013 Bonds will not be diminished or postponed thereby, (ii) the
amounts of and dates on which the anticipated transfers from the 2014 Escrow Fund to the Paying
Agent for the payment of the principal of, redemption price of, and interest on the 2014 Bonds will
not be diminished or postponed thereby, (iii) the Escrow Bank shall receive the unqualified opinion
of nationally recognized municipal bond counsel to the effect that such reinvestment will not
adversely affect the exclusion from gross income for federal or state income tax purposes of
interest on the Bonds, the 2013 Bonds or the 2014 Bonds, as applicable, (iv) the Escrow Bank shall
receive from a firm of independent certified public accountants a certification that, immediately
after such reinvestment, the principal of and interest on obligations in the 2013 Escrow Fund will,
together with other cash on deposit in the 2013 Escrow Fund available for such purposes, be
sufficient without reinvestment to pay, when due, the principal or redemption price of and interest
on the 2013 Bonds; (v) the Escrow Bank shall receive from a firm of independent certified public
accountants a certification that, immediately after such reinvestment, the principal of and interest
on obligations in the 2014 Escrow Fund will, together with other cash on deposit in the 2014
Escrow Fund available for such purposes, be sufficient without reinvestment to pay, when due, the
principal or redemption price of and interest on the 2014 Bonds; and (vi) the Escrow Bank shall
receive an opinion of nationally recognized bond counsel that such reinvestment is permissible
under this Agreement.
SECTION 6. Indemnity. The Successor Agency hereby assumes liability for, and
hereby agrees (whether or not any of the transactions contemplated hereby are consummated) to
indemnify, protect, save and keep harmless the Escrow Bank and its respective successors, assigns,
agents, employees and servants, from and against any and all liabilities, obligations, losses,
damages, penalties, claims, actions, suits, costs, expenses and disbursements (including reasonable
legal fees and disbursements) of whatsoever kind and nature which may be imposed on, incurred
by, or asserted against, the Escrow Bank at any time (whether or not also indemnified against the
same by the Successor Agency or any other person under any other agreement or instrument, but
without double indemnity) in any way relating to or arising out of the execution, delivery and
performance of its Agreement, the establishment hereunder of the 2013 Escrow Fund and the 2014
Escrow Fund, the acceptance of the funds and securities deposited therein, and any payment,
transfer or other application of moneys or securities by the Escrow Bank in accordance with the
provisions of this Agreement; provided, however, that the Successor Agency shall not be required
to indemnify the Escrow Bank against the Escrow Bank’s own negligence or willful misconduct
or the negligent or willful misconduct of the Escrow Bank’s respective successors, assigns, agents
and employees or the breach by the Escrow Bank of the terms of this Agreement. In no event shall
the Successor Agency or the Escrow Bank be liable to any person by reason of the transactions
contemplated hereby other than to each other as set forth in this section. The indemnities contained
in this section shall survive the termination of this Agreement.
SECTION 7. Responsibilities of the Escrow Bank. The Escrow Bank and its
respective successors, assigns, agents and servants shall not be held to any personal liability
whatsoever, in tort, contract or otherwise, in connection with the execution and delivery of this
Agreement, the establishment of the Escrow Fund, the acceptance of the moneys or securities
deposited therein, to accomplish the refunding and defeasance of the 2013 Bonds and the 2014
157
Bonds or any payment, transfer or other application of moneys or obligations by the Escrow Bank
in accordance with the provisions of this Agreement or by reason of any non-negligent act, non-
negligent omission or non-negligent error of the Escrow Bank made in good faith in the conduct
of its duties. The recitals of fact contained in the “whereas” clauses herein shall be taken as the
statements of the Successor Agency and the Escrow Bank assumes no responsibility for the
correctness thereof. The Escrow Bank makes no representation as to the sufficiency of the monies
deposited to accomplish the refunding and defeasance of the 2013 Bonds and the 2014 Bonds or
to the validity of this Agreement as to the Successor Agency and, except as otherwise provided
herein, the Escrow Bank shall incur no liability with respect thereto. The Escrow Bank shall not
be liable in connection with the performance of its duties under this Agreement except for its own
negligence, willful misconduct or default, and the duties and obligations of the Escrow Bank shall
be determined by the express provisions of this Agreement. The Escrow Bank may consult with
counsel, who may or may not be counsel to the Successor Agency, and in reliance upon the written
opinion of such counsel shall have full and complete authorization and protection with respect to
any action taken, suffered or omitted by it in good faith in accordance therewith. Whenever the
Escrow Bank shall deem it necessary or desirable that a matter be proved or established prior to
taking, suffering, or omitting any action under this Agreement, such matter may be deemed to be
conclusively established by a certificate signed by an authorized officer of the Successor Agency.
The Successor Agency acknowledges that to the extent regulations of the Comptroller of the
Currency or other applicable regulatory entity grant the Successor Agency the right to receive
brokerage confirmations of security transactions as they occur, the Successor Agency specifically
waives receipt of such confirmations to the extent permitted by law. The Escrow Bank will furnish
the Successor Agency periodic cash transaction statements which include detail for all investment
transactions made by the Escrow Bank hereunder.
SECTION 8. [Reserved].
SECTION 9. Irrevocable Instructions as to Notice.
(a) The Successor Agency hereby irrevocably instructs the Escrow Bank to
give notice within five business days of delivery of the Bonds of defeasance of the respective series
of Refunded Bonds, substantially in the forms set forth in _________ hereto. Such notices shall be
delivered: (i) by mail (by first class mail, postage prepaid) to the registered owners of the Refunded
Bonds, (ii) by mail to the Securities Depositories and the Information Services, and (iii) by
electronic means of communication to the Municipal Securities Rulemaking Board ("MSRB")
through the Electronic Municipal Market Access System (referred to as "EMMA"), at
www.emma.msrb.org.
(b) The Successor Agency hereby irrevocably instructs the Escrow Bank, to
give, 30 but not more than 60 days prior to the redemption date and in accordance with the Original
Indenture or the 2014 Indenture, as applicable, notice of redemption of such Refunded Bonds to
the Owners thereof, substantially in the form set forth in _________ hereto. Such notices shall be
delivered: (i) by mail (by first class mail, postage prepaid) to the registered owners of the Refunded
Bonds, (ii) by mail to the Securities Depositories, and (iii) by electronic means of communication
to the MSRB through EMMA, at www.emma.msrb.org. Such delivery shall not be a condition
precedent to such redemption and neither failure to receive any such notice nor any defect therein
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shall affect the validity of the proceedings for the redemption of such Refunded Bonds or the
cessation of the accrual of interest thereon.
(c)
SECTION 10. Amendments. This Agreement is made for the benefit of the Successor
Agency and the holders from time to time of the 2013 Bonds and 2014 Bonds and it shall not be
repealed, revoked, altered or amended without the written consent of all such holders, the Escrow
Bank and the Successor Agency; provided, however, but only after the receipt by the Escrow Bank
of an opinion of nationally recognized bond counsel that the exclusion from gross income of
interest on the Bonds, the 2013 Bonds and the 2014 Bonds will not be adversely affected for
federal income tax purposes, that the Successor Agency and the Escrow Bank may, without the
consent of, or notice to, such holders, amend this Agreement or enter into such agreements
supplemental to this Agreement as shall not adversely affect the rights of such holders and as shall
not be inconsistent with the terms and provisions of this Agreement for any one or more of the
following purposes: (i) to cure any ambiguity or formal defect or omission in this Agreement; (ii)
to grant to, or confer upon, the Escrow Bank for the benefit of the holders of the 2013 Bonds or
the 2014 Bonds any additional rights, remedies, powers or authority that may lawfully be granted
to, or conferred upon, such holders or the Escrow Bank; and (iii) to include under this Agreement
additional funds, securities or properties. The Escrow Bank shall be entitled to rely conclusively
upon an unqualified opinion of nationally recognized municipal bond attorneys with respect to
compliance with this Section 10, including the extent, if any, to which any change, modification,
addition or elimination affects the rights of the holders of the 2013 Bonds or the 2014 Bonds or
that any instrument executed hereunder complies with the conditions and provisions of this Section
10. In the event of any conflict with respect to the provisions of this Agreement, this Agreement
shall prevail and be binding.
SECTION 11. Term. This Agreement shall commence upon its execution and delivery
and shall terminate on the later to occur of either (i) the date upon which the 2013 Bonds and the
2014 Bonds have been paid in accordance with this Agreement or (ii) the date upon which no
unclaimed moneys remain on deposit with the Escrow Bank pursuant to Section 3(b) of this
Agreement.
SECTION 12. Compensation. The Escrow Bank shall receive its reasonable fees and
expenses as previously agreed to; provided, however, that under no circumstances shall the Escrow
Bank be entitled to any lien nor will it assert a lien whatsoever on any moneys or obligations in
the 2013 Escrow Fund and 2014 Escrow Fund for the payment of fees and expenses for services
rendered by the Escrow Bank under this Agreement.
SECTION 13. Severability. If any one or more of the covenants or agreements provided
in this Agreement on the part of the Successor Agency or the Escrow Bank to be performed should
be determined by a court of competent jurisdiction to be contrary to law, such covenants or
agreements shall be null and void and shall be deemed separate from the remaining covenants and
agreements herein contained and shall in no way affect the validity of the remaining provisions of
this Agreement.
159
SECTION 14. Counterparts. This Agreement may be executed in several counterparts,
all or any of which shall be regarded for all purposes as one original and shall constitute and be
but one and the same instrument.
SECTION 15. Governing Law. This Agreement shall be construed under the internal
laws of the State of California.
SECTION 16. Holidays. If the date for making any payment or the last date for
performance of any act or the exercising of any right, as provided in this Agreement, shall be a
legal holiday or a day on which banking institutions in the city in which is located the principal
office of the Escrow Bank are authorized by law to remain closed, such payment may be made or
act performed or right exercised on the next succeeding day not a legal holiday or a day on which
such banking institutions are authorized by law to remain closed, with the same force and effect
as if done on the nominal date provided in this Agreement, and no interest shall accrue for the
period from and after such nominal date.
SECTION 17. Assignment. This Agreement shall not be assigned by the Escrow Bank
or any successor thereto without the prior written consent of the Successor Agency.
SECTION 18. Standard & Poor’s. The Successor Agency agrees to provide S&P
Global Ratings, 55 Water Street, 45th Floor, New York, New York 10041, prior notice of each
amendment entered into pursuant to Section 10 hereof and a copy of such proposed amendment,
and to forward a copy (as soon as possible) of (i) each amendment hereto entered into pursuant to
Section 10 hereof, and (ii) any action relating to severability or contemplated by Section 13 hereof.
SECTION 19. Reorganization of Escrow Bank. Notwithstanding anything to the
contrary contained in this Agreement, any company into which the Escrow Bank may be merged
or converted or with which it may be consolidated or any company resulting from any merger,
conversion or consolidation to which the Escrow Bank is a party, or any company to which the
Escrow Bank may sell or transfer all or substantially all of its corporate trust business shall be the
successor to the Escrow Bank without execution or filing of any paper or any paper or further act,
if such company is eligible to serve as Escrow Bank.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers this 1st day of February 2021.
SUCCESSOR AGENCY TO THE LA
QUINTA REDEVELOPMENT AGENCY
By:
Executive Director
U.S. BANK NATIONAL ASSOCIATION, as
Escrow Bank
By:
Authorized Officer
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SCHEDULE A
Redemption of 2013 Bonds
Principal Principal Date Matured Interest Redeemed Total
Redemption of 2014 Bonds
Principal Principal Date Matured Interest Redeemed Total
162
124/015610-0182
15505522.3 a12/10/20 SCHEDULE B
SCHEDULE B
Type of
Security
Maturity
Date Par Amount Rate Yield Price
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2533 S. Coast Highway 101, Suite 250 ∙ Cardiff By The Sea, CA 92007 ∙ www.hilltopsecurities.com
ATTACHMENT 6
Summary of 2013 and 2014 Refinancings
Successor Agency to the La Quinta Redevelopment Agency/Riverside County
Oversight Board
•In December 2013 and June 2014, the Successor Agency completed the refinancing
of its 1998, 2001, 2002, 2003 and 2004 Tax Allocation financings issued by the
former Redevelopment Agency. Issued in tax-exempt and taxable series, there is
now an opportunity to again refinance the Successor Agency’s 2013 and 2014
Bonds, for economic savings. The financings consist of $97,190,000 of
Subordinate Tax Allocation Refunding Bonds, 2013 Series A of which $69,990,000
are currently outstanding, $23,055,000 Subordinate Tax Allocation Refunding
Bonds, 2013 Taxable Series B of which $16,375,000 are currently outstanding
(together the “2013 Bonds”) and $65,600,000 Tax Allocation Refunding Bonds,
2014 Series A of which $52,095,000 are currently outstanding (the “2014 Bonds”).
Current bond interest rates are at historically low levels and refinancing the 2013
Bonds and 2014 Bonds will reduce annual bond payments, allowing additional
property tax revenue distribution to the City and local taxing agencies.
•The 2013 Bonds and 2014 Bonds currently pay interest at rates ranging from
3.00% to 5.82%. Refinancing the 2013 Bonds and 2014 Bonds is expected to
reduce interest rates to levels ranging from 0.97% to 2.60%.
Following the issuance of the 2021 Bonds, the Agency would have its final debt in place
and is expected to be as follows:
Savings Analysis
The 2021 Bonds will be payable on the same dates (March 1 and September 1) and will
mature, without extension of final maturity, on September 1, 2034 (the existing final
maturity on the 2014 Bonds).
Refunding numbers on the 2021 Bonds show that based on current interest rates and
yields, the Successor Agency can achieve annual debt service savings of $161,400 to
$680,376 on an annual basis for overall savings of $8.516 million over the remaining life
Original Principal Outstanding Principal Final Maturity Interest Rate Range
Project Areas 1 and 2
2013 Tax-Exempt Bonds $97,190,000 Defeased n/a n/a
2013 Taxable Bonds 23,055,000 Defeased n/a n/a
2014 Tax-Exempt Bonds 65,600,000 Defeased n/a n/a
2016 Taxable Bonds 35,280,000 29,380,000 2039 2.679% - 4.527%
2021 Taxable Bonds*157,470,000 157,470,000 2034 0.970% - 2.600%
* 2021 Taxable Bonds data are all estimates
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2533 S. Coast Highway 101, Suite 250 ∙ Cardiff By The Sea, CA 92007 ∙ www.hilltopsecurities.com
of the 2013 and 2014 Bonds. The overall estimated savings are after ALL costs associated
with the financing have been paid.
The following sets forth the detailed annual savings:
Since the reduced debt service after refunding will reduce the amount of property taxes
deposited in the Redevelopment Property Tax Trust Fund required to be paid to the
Successor Agency, there will be additional “residual” property tax revenue that can be
distributed to taxing agencies that overlap the boundaries of the Redevelopment Project
Areas in accordance with their share of the general property tax levy shown below. The
City may be able to use up to 50% of the additional residual generated by the refunding
first to repay certain City advances to the former Redevelopment Agency, and if so, the
taxing agencies will receive their percentage of the remaining residual after such payment
estimated as follows.
• School Districts: 62.50% or $5,323,100
• Riverside County: 22.18% or $1,889,100
• Coachella Valley Water District: 7.21% or $614,100
• City of La Quinta: 5.29% or $450,500
• Recreation and Parks: 2.82% or $240,200
Bond Total Total
Year Refunded Refunding
Ending Debt Service Debt Service Savings
9/1/2021 $11,544,625 $11,174,263 $370,362
9/1/2022 15,016,138 14,338,476 677,663
9/1/2023 15,010,170 14,334,356 675,815
9/1/2024 15,011,902 14,334,888 677,015
9/1/2025 15,007,332 14,332,150 675,183
9/1/2026 15,009,368 14,329,328 680,041
9/1/2027 15,011,498 14,337,098 674,401
9/1/2028 15,011,063 14,332,605 678,458
9/1/2029 15,002,366 14,325,005 677,361
9/1/2030 15,010,006 14,329,630 680,376
9/1/2031 15,012,345 14,335,330 677,015
9/1/2032 15,011,864 14,336,095 675,769
9/1/2033 5,652,063 5,115,975 536,088
9/1/2034 5,265,750 5,104,350 161,400
Total $187,576,488 $179,059,546 $8,516,941
Net Present Value Savings $7,503,858
Net Present Value Savings %5.420%
165
2533 S. Coast Highway 101, Suite 250 ∙ Cardiff By The Sea, CA 92007 ∙ www.hilltopsecurities.com
The following table sets forth the estimated Costs associated with the 2021 financing.
Underwriter’s Discount estimated at 0.41%, costs of issuance estimated at 0.24%, and a
debt service reserve surety bond fee of 0.22% for all in costs of 0.87% which is in line
with the percentage of costs associated with refunding programs of this security level and
size. As previously mentioned, the savings discussed above are after all costs of issuance
associated with the financing.
The Financing Team expects the Bonds to be rated “AA” by Standard and Poor’s. The
2013 Bonds and 2014 Bonds carry a reserve fund surety bond in lieu of cash for the
existing debt service reserve fund. The use of a replacement reserve fund surety bond
will be required in order to achieve the projected savings.
2013 Bonds and 2014 Bonds Escrow Accounts
Proceeds from the financing will be held in an escrow that will pay regularly scheduled
principal and interest on the 2013 Bonds and 2014 Bonds until their first optional call date
of September 1, 2023 (for the 2013 Bonds) and September 1, 2024 (for the 2014 Bonds).
The proceeds held in the escrow will be invested in either State and Local Government
Securities or Open Market Securities, whichever are more efficient. The 2013 Bonds and
the 2014 Bonds will be considered fully defeased on the date the 2021 Bonds are issued.
Conclusion
There is no way of knowing if the municipal market will maintain current interest rates
and yields long enough for the Successor Agency to complete the approval and the
Estimated
2021 Bonds
Costs of Issuance
Rutan & Tucker, Bond Counsel $113,000
Nixon Peabody, Disclosure Counsel 37,500
Harrell & Company, Financial Advisor 87,000
Standard & Poor's Ratings Group, Rating Services 86,000
Grant Thornton, Verification Consultant 3,500
US Bank National Association, Trustee and Escrow Bank 13,050
Avia Communications, Financial Printing 2,000
Staff Reimbursement 30,000
Miscellaneous 2,950
Subtotal Costs of Issuance $375,000
Underwriter's Discount 645,627
Surety Bond Premium 344,123
Total Costs of Issuance $1,364,750
Percentage of Bond Financing 0.87%
166
2533 S. Coast Highway 101, Suite 250 ∙ Cardiff By The Sea, CA 92007 ∙ www.hilltopsecurities.com
Department of Finance review process estimated to require 60 to 75 days. We believe
your Financing Team should be able to steer the refinancing through the approval process
at little or no cost to the Successor Agency, should the refunding bonds not be
economically feasible following the approval and review process.
By refunding the 2013 Bonds and 2014 Bonds simultaneously, the Successor Agency will
only be required to amend its Last and Final ROPS once which will leave the second
allowable amendment under the dissolution act for a later time if needed.
Timeline
The following is a general timeline for the proposed refinancing. This schedule will be
updated based on DOF approval actions and market conditions and is based on DOF
approving the revised financing based on the Amended and Restated Resolution on a
similar timeline as originally contemplated.
Scheduled Event Date to Complete
Successor Agency Board adopts a First Amended and Restated Resolution
approving Legal Documents December 15
Oversight Board adopts a First Amended and Restated Resolution
approving Agency Actions January 7
Submit Documents to Rating Agency/Surety Bond Providers Week of
February 1
DOF Approval of Financing Week of
February 15
Receive Rating/Surety Bond Week of
February 22
Bond Sale - Successor Agency signs Purchase Contract March 3
Bond Closing March 17
Oversight Board meeting to approve Last and Final Amendment May 6
167
POWER POINTS
SUCCESSOR
AGENCY
SPECIAL
MEETING
DECEMBER 15, 2020
City Council Meeting ‐SA Special Meeting December 15, 2020
1
Successor Agency Special Meeting
December 15, 2020
Business Session Item No. 1
B1 - Adopt an Amended and Restated Resolution for
Issuance and Sale of Tax Allocation Refunding Bonds
1
What Bonds would be refinanced?
Description Original Amount Amended
Amount
2013A Principal (Tax Exempt) $ 69,990,000 $69,990,000
2013B Principal (Taxable) $ 16,375,000 $16,375,000
2014 Principal (Tax Exempt) ‐‐‐‐‐$52,095,000
Interest Payable through 9/1/2023 (Escrow Fund) $11,896,727 $11,896,727
Interest Payable through 9/1/2024 (Escrow Fund)‐‐‐‐‐$5,748,523
Cost of Issuance $ 275,000 $375,000
Underwriter’s Discount/Reserve Surety Bond $ 763,273 $989,750
Total (2021 Taxable Bonds)$ 99,210,000 $157,470,000
2
1
2
City Council Meeting ‐SA Special Meeting December 15, 2020
2
Bond Refinancing
•Bonds were issued by the former Redevelopment Agency
–not a General Fund obligation
•Secured by pledged property taxes
–Redevelopment Property Tax Trust Fund (RPTTF)
•Maturity to end same as 2014 Bonds, September 2034
•2021 Bonds will be taxable
•Adheres to City’s Debt Management Policy
–Net Present Value of Anticipated Savings is 5.42%
3
Why add the 2014 Bonds now?
•Additional advantages to amending the refinancing.
–All Bonds on Equal Security Level –no senior or
subordinate designations
–4 outstanding bonds reduced to 2
–Reduced ongoing trustee and disclosure fees
–2016 and 2021 Bonds will be based on the same and
equal legal documents (easier tracking and reporting)
–Preserve 2nd amendment to the Last and Final ROPS
4
3
4
City Council Meeting ‐SA Special Meeting December 15, 2020
3
Why Refinance?
•Refinancing 2013 and 2014 Bonds will:
–Lower interest rates
•.97% to 2.60% versus current 3% to 5.82%
–Lower annual debt service payments by an average of
$608,300 or $8.52 million over remaining term
–Provides additional property tax revenue to local agencies
Local Agency Savings Over 13 Years Savings Over 14 Years % of Savings
School Districts $ 4,264,200 $5,323,100 62.5%
Riverside County $ 1,513,000 $1,889,100 22.18%
CV Water District $ 491,900 $614,100 7.21%
City of La Quinta $ 361,000 $450,500 5.29%
Parks & Recreation $ 192,400 $240,200 2.82%
5
Costs of Refinancing?
•Anticipated refinance amount is $157,470,000
•Cost of Issuance estimated at $375,000
•At time of sale, Underwriter discount for selling Bonds
•Savings discussed are after these costs
Financial
Advisor Bond Counsel Disclosure
Counsel Underwriter
Verification
Consultant
Trustee and
Escrow Bank
Fees
Rating Agency City Staff Time
6
5
6
City Council Meeting ‐SA Special Meeting December 15, 2020
4
Amended Timeline
Date Entity Description
12/15/2020 Successor Agency Review and Approval
1/7/2021 County Oversight Board Review and Approval
1/8/2021 CA Department of Finance Review and Approval
2/22/2021 S&P Global Ratings Credit Rating Agency Review and Rating
Update
3/15/2021 CA Department of Finance Approval Deadline
3/31/2021 City and Consultants Final Pricing
4/14/2021 City and Consultants Bond Closing
5/6/2021 County Oversight Board Last and Final ROPS Amendment
7
Questions
and
Discussion
8
7
8