Minutes 1993 0524 - Laserfiche WebLink

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Minutes - San Leandro City Council Meeting - May 24, 1993 Page - 5 - NEW BUSINESS (continued) Council Member Kerr asked if there would still be Redevelopment Agency funds that would be vulnerable to the State. He said he understood a Senate Committee and the Governor's Office are looking at that. Mr. Jermanis said tonight's actions would tie up the funds to the extent possible through the bond issue. He said these funds are what the Redevelopment Agency can reasonably expect to pay, including bonds, maintenance costs, staff, etc. He said the amount being asked for in payment to the bond holders equals the amount previously owed to the City. Council Member Kerr asked what would happen if the project costs go up to $25 million. Mr. Jermanis said there are contingency reserves available as a result of refinancing the -Parking Authority debt. He said there is $2.5 million in a sinking fund reserve which can be held pending completion of all major capital . improvement projects, including the Marina Community Center, dredging of the City Marina, reconfiguration of the water circulation area, etc. Council Member Perry asked, if the Redevelopment Agency bonds are not pulled until October, would the interest rate still be 6.5%. Mr. Jermanis said the bonds will be issued immediately, and the funds will be reinvested during the period before the City starts drawing them down. He said construction of the building would not commence immediately, and there are many logistics involved in moving people, etc. He said the bond underwriter will watch the market daily so the City can move quickly. He said the City Council and other agencies' actions will authorize himself, the Mayor, and the City Manager to execute the necessary documents on the Council 's behalf, at the right opportunity, without coming back to the Council . Council Member Perry asked for an explanation of how the use of Bank of America as the Trustee would work. Mr. Jermanis said the Trustee plays an important role in the process. He said all the banks interested in providing trustee services were given an opportunity to submit proposals, and four banks submitted proposals for each of the bond issues. He said Bank of America's proposal provided the best quote for the fees. In addition, administratively it is desirable to use Bank of America because of the ease of transferring funds, etc. Mayor Karp noted there are not many banks that handle bond transactions, and Bank of America has a whole department working just on bonding. Council Member Perry asked if relocation costs were part of the North Offices Addition and if they included the two businesses on the north block. Mr. Jermanis said the "Other Project Costs" category included property acquisition and relocation. He said the City has been in contact with them about the fact that the City will be acquiring the properties. Council Member Perry said she hoped the City would actively help the businesses relocate and stay in the North Area.