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File Number: 18-539 <br />past ten years, and similarly has ranked as one of the top disclosure counsels in California during <br />this same period. Proposals for disclosure counsel for the 2018 Bonds were solicited through an <br />RFP. <br />U.S. Bank is bond trustee for the City’s lease revenue bonds and certificates of participation. U.S. <br />Bank is one of the top five municipal bond trustees in the country. U.S. Bank also serves the City <br />with two local branch offices. <br />All fees associated with issuing the 2018 Bonds will be paid from bond proceeds. <br />Sources and Uses of Funds <br />Staff projects the following sources and uses of funds for the 2018 Bonds, from the underwriter’s <br />preliminary bond sizing numbers assuming interest rates as of 10/5/18 with a cushion of 25 basis <br />points and an S&P underlying rating of AA-. <br />$18,620,000 Par amount of 2018 Bonds <br /> 1,618,198 Premium <br />$20,238,198 Total sources of funds <br />$20,000,000 Deposit to Project Fund <br /> 169,584 Costs of issuance & misc. <br /> 68,614 Underwriter’s discount <br />$20,238,198 Total uses of funds <br />Sources of funds include original issue premium on the 2018 Bonds because it is assumed that <br />coupons will be higher than yields - if this is not the case and coupons go lower to be closer to <br />yields, the premium will go down and the par amount of 2018 Bonds will go up, but overall debt <br />service will be about the same because of the lower coupons. A debt service reserve fund will not <br />be funded in this issue, because the City’s credit strength should allow for a strong rating without <br />needing a funded reserve. The City’s credit strength also means that bond insurance is not <br />expected to be necessary for this transaction. The underwriter’s discount is a fee paid to the <br />underwriter for structuring and marketing the 2018 Bonds. The costs of issuance pay for legal, <br />municipal advisor, trustee, printing, and other issuance costs. <br />California Government Code Disclosures <br />Sec. 5852.1 was recently added to the Government Code, requiring that prior to authorization of <br />the issuance of bonds with a term greater than 13 months, the governing body of the issuer shall <br />disclose the information listed below at a public meeting. All disclosure is based on the <br />preliminary bond sizing used for the Sources and Uses of Funds, as of the 10/5/18 market + 25 <br />basis points. <br />(A) The all-in TIC of the 2018 Bonds, meaning the overall cost of debt, is currently expected to be <br />4.46%. <br />(B) The finance charge of the 2018 Bonds, meaning the total costs of issuance and underwriter’s <br />discount combined, is currently expected to be $238,198. <br />(C) The net proceeds of the 2018 Bonds, meaning net of all finance charges and any reserves or <br />capitalized interest, is expected to be $20,000,000. <br />Page 3 City of San Leandro Printed on 10/30/2018