Finance Highlights 2011 0909 - Laserfiche WebLink

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CITY COUNCIL FINANCE COMMITTEE September 9, 2011 8:15 a.m. — 9:45 p.m. San Leandro City Hall 835 E. 14 Street San Leandro, California (Sister Cities Gallery) HIGHLIGHTS Committee Members: Mayor Cassidy, Councilmember Gregory, Councilmember Souza City Staff Present: Interim City Manager Marshall, Interim Finance Director O'Leary, Deputy Finance Director Rodriguez, Sr. Accountant Galvin, Administrative Assistant III Perez Public Present: None The meeting was called to order at 8:15 a.m. 1. Continued Discussion Regarding Plan for Refinancing CAPERS Public Safety Retirement Plan Side Fund Interim City Manager Marshall introduced Interim Finance Director O'Leary to the Finance Committee. Mr. O'Leary provided an update on the Refinancing of the Ca1PERS Public Safety Retirement Plan Side Fund. Mr. O'Leary provided a brief historical summary of the side fund. In June 30, 2004, CalPERS created a risk pool by pooling assets and liabilities across groups of employers with less than 100 active employees, intended to dramatically reduce or eliminate large fluctuations in employers' contributions. Mr. O'Leary reminded the Committee that in May of 2011, the Finance Committee requested that staff look for a Financial Advisor to begin the process of refinancing and bond issuance. Since that time a Request for Qualifications (RFQ) for a Financial Advisor was completed and Public Financial Management, Inc. was selected by staff and approved by City Council on July 5, 2011. The purpose of the refinance is to lower the rate of the City's public safety side fund obligation. Currently the side fund payment is at a 7.75% rate. As of today the estimated all -in interest rate, including the cost of issuance, is around 4.61 %. Mr. O'Leary provided a financing schedule and timeline that staff foresees in having the refinancing approved and the bonds issued. The issuance of the pension obligation bonds requires a validation proceeding in the Alameda County Superior Court. To commence the validation, City Council must approve the resolution for the issuance of the bonds and filing of the validation action. Mr. O'Leary explained that once the Council resolution is approved, Bond Counsel will file the necessary court action. The bonds will be issued under an indenture of trust between the City and the trustees. Mr. O'Leary also informed the Finance Committee that the amount of bond issuance can be reduced by obtaining a loan from the Water Pollution Control Plant Fund of up to $6,000,000.