8D Consent 2007 0416 - Laserfiche WebLink

Home

legislation was approved by voters at the election on March 2, 2004 and the bonds were sold in May 2004. See" -Impact of Sales and Use Tax Redirection" below. 2006-07 State Budget. On June 30, 2006 the Governor signed the fiscal year 2006-07 budget act (the "2006-07 State Budget"). The 2006-07 State Budget projects that the State will be able to fund much more than a current-law budget and still maintain fiscal balance in fiscal year 2006-07, primarily due to both a major increase in revenues and a significant amount of savings adopted in the fiscal year 2005-06 budget. The 2006-07 State Budget provides for over $4 billion in higher spending. The main increase involves Proposition 98 education, where $2.8 billion more than the minimum guarantee will be provided over the current and budget year combined. The 2006-07 State' Budget, at the time of adoption, showed a stronger state revenue outlook with projected revenues of $92 billion, and included a number of specific proposals that will benefit cities. These include $424 million in Proposition 42 transportation funds; $98 million reimbursement to local governments of state mandated programs; $23.3 million increased funding for public safety programs; and a number of other items. Future State Budgets. The City cannot predict what actions will be taken in future years by the State Legislature and the Governor to address the State's current or future budget deficits. Future State budgets will be affected by national and state economic conditions and other factors over which the City has no control. To the extent that the State budget process results in reduced revenues to the City, the City will be required to make adjustments to its budget. Decrease in such revenues may have an adverse impact on the City's ability to pay Lease Payments. RISK FACTORS The following factors, along with all other information in this Official Statement, should be considered by potential investors in evaluating the Certificates. No Pledge of Taxes The obligation of the City to pay the Lease Payments and Additional Payments does not constitute an obligation of the City for which the City is obligated to levy or pledge any form of taxation or for which the City has levied or pledged any form of taxation. The obligation of the City to pay Lease Payments and Additional Payments does not constitute a debt or indebtedness of the Authority, the City, the State of California or any of its political subdivisions within the meaning of any constitutional or statutory debt limitation or restriction. Although the Lease Agreement does not create a pledge, lien or encumbrance upon the funds of the City, the City is obligated under the Lease Agreement to pay Lease Payments and Additional Payments from any source of legally available funds (subject to certain exceptions) and the City has covenanted in the Lease Agreement that, for as long as the Property is available for its use and possession, it will make the necessary annual appropriations within its budget for all Lease Payments and Additional Payments. The City may be liable in the future on other obligations payable from general fund revenues, which could include tax and revenue anticipation notes, pension obligation bonds and various certificates of participation issued by the City. In the event of a shortfall in revenues, a court might require that the City first set aside revenues to pay the tax and revenue anticipation notes and the pension obligation bonds. See "THE CITY OF SAN LEANDRO - Outstanding General Fund Debt and Lease Obligations." -36-