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HEARING - Planning and Building Department recommending the Board consider the following:
1) Conduct a public hearing under the requirements of the Tax and Equity Fiscal Responsibility Act (TEFRA) in connection with the proposed issuance of one (1) or more series of tax-exempt and/or taxable of revenue bonds by the California Municipal Finance Authority, a joint exercise of powers authority and public entity of the State of California, in an amount not-to-exceed $3,750,000, to refinance all or a portion of the Association of Bay Area Governments, Finance Authority for Nonprofit Corporations $22,000,000 Variable Rate Demand Revenue Bonds (Eskaton Village - Roseville), Series 2006 and $23,500,000 Variable Rate Demand Revenue Refunding Bonds (Eskaton Properties, Incorporate) Series 2008A and costs related thereto, which financed an assisted living facility located at 3421 Palmer Drive, Cameron Park, California, within the County of El Dorado; and
2) Adopt and authorize the Chair to sign Resolution 137-2022 approving the issuance of Bonds by the CMFA for the benefit of Eskaton Properties, Incorporated, a nonprofit, public benefit corporation organized and existing under the laws of the State of California and an organization described in section 501(c)(3) of the Code, to provide for the financing of the project, such adoption is solely for the purposes of satisfying the requirements of TEFRA, the Code and the California Government Code Section 6500 (and following). (Supervisorial District 2).
FUNDING: California Municipal Finance Authority.
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DISCUSSION / BACKGROUND
The California Municipal Finance Authority (CMFA) was created on January 1, 2004, pursuant to a Joint Exercise of Powers Agreement to promote economic, cultural and community development, through the financing of economic development and charitable activities throughout California. To date, over 300 municipalities, including El Dorado County (County), have become members of CMFA.
The CMFA was formed to assist local governments, non-profit organizations and businesses with the issuance of taxable and tax-exempt bonds aimed at improving the standard of living in California. The CMFA’s representatives and its Board of Directors have considerable experience in bond financings.
The Joint Exercise of Powers Agreement provides that the CMFA is a public entity, separate and apart from each member executing such agreement. The debts, liabilities and Bonds of the CMFA do not constitute debts, liabilities or Bonds of the members executing such agreement.
The Bonds to be issued by the CMFA for the assisted living facility located at 3421 Palmer Drive in Cameron Park (Project) will be the sole responsibility of Eskaton Properties, Inc. (Borrower), and the County will have no financial, legal, moral obligation, liability or responsibility for the Project or the repayment of the Bonds for the financing of the Project. All financing documents with respect to the issuance of the Bonds will contain clear disclaimers that the Bonds are not Bonds of the County or the State of California but are to be paid for solely from funds provided by the Borrower.
Borrower has requested that the CMFA serve as the municipal issuer of tax-exempt and/or taxable Bonds in an aggregate principal amount not to exceed $3,750,000. The proceeds of the Bonds will be used as part of a plan to refinance all or a portion of the Association of Bay Area Governments, Finance Authority for Nonprofit Corporations $22,000,000 Variable Rate Demand Revenue Bonds (Eskaton Village - Roseville), Series 2006 and $23,500,000 Variable Rate Demand Revenue Refunding Bonds (Eskaton Properties, Incorporate) Series 2008A and costs related thereto, which financed an assisted living facility owned and operated by the Borrower and located at 3421 Palmer Drive, Cameron Park, California, within the County of El Dorado.
In order for all or a portion of the Bonds to qualify as tax-exempt bonds, the County of El Dorado must conduct a public hearing (TEFRA Hearing) providing for the members of the community an opportunity to speak in favor of or against the use of tax-exempt bonds for the financing of the Project. Prior to such TEFRA Hearing, reasonable notice must be provided to the members of the community. Following the close of the TEFRA Hearing, an “applicable elected representative” of the governmental unit hosting the Project must provide its approval of the issuance of the Bonds for the financing of the Project. It is recommended by staff that the Board conduct the TEFRA Hearing and adopt the Resolution in favor of the issuance of Bonds to the Borrower by the CMFA.
ALTERNATIVES
N/A.
PRIOR BOARD ACTION:
N/A
OTHER DEPARTMENT / AGENCY INVOLVEMENT
County Counsel
CAO RECOMMENDATION
Approve as recommended.
FINANCIAL IMPACT
There is no direct financial impact to the County, until and unless the bonds are issued. After the bonds are issues, it is expected that a portion of the issuance fee will be granted by CMFA to the general fund of the County.
The Board of Directors of the California Foundation for Stronger Communities, a California non-profit public benefit corporation (Foundation), acts as the Board of Directors for the CMFA. Through its conduit issuance activities, the CMFA shares a portion of the issuance fees it receives with its member communities and donates a portion of these issuance fees to the Foundation for the support of local charities. With respect to the County of El Dorado, it is expected that a portion of the issuance fee will be granted by the CMFA to the general fund of the County of El Dorado. Such grant may be used for any lawful purpose of the County.
CLERK OF THE BOARD FOLLOW UP ACTIONS
1) The Clerk of the Board will obtain the Chair’s signature on two (2) original copies of the Resolution; and
2) The Clerk of the Board will forward two (2) certified copies of the fully executed Resolution to Planning and Building Department, Christopher Smith, Planning Division.
STRATEGIC PLAN COMPONENT
Good Governance: Evaluate requests and recommendations based on complete assessment of the best available information, with the goal of reaching well informed decisions.
CONTACT
Karen Garner, Director of Planning and Building
Planning and Building Department