HomeMy WebLinkAboutAdopt City Council Resolution No 2016-02 declaring its inten PROOF OF SERVICE OF PAPERS
STATE OF CALIFORNIA )
) ss
COUNTY OF ORANGE )
I am employed in the County of Orange, State of California I am over the age of 18 and
not a party to the within action, my business address is 2000 Main Street, Huntington Beach,
CA 92648
Pursuant to Code of Civil Procedure§ 1094 6, on February 11, 2016, 1 served the
foregoing documents(s) described as Notice of Public Hearing on the Intention of the City
Council of the City of Huntington Beach to Approve an Amendment to the Rate and Method of
Apportionment of Special Tax for City of Huntington Beach Community Facilities District No
2000-1 (Grand Coast Resort) and Resolution No 2016-02, Declaring the C►ty's Intention to
Consider an Amendment to the Rate and Method of Apportionment of Special Tax on the
interested parties in this action by placing a true copy thereof in a sealed envelope addressed
as follows
Fred Wilson, Executive Director
Successor Agency to the Former Redevelopment Agency of the City of Huntington Beach
2000 Main Street, 4th Floor
Huntington Beach, CA 92648
a [X] BY MAIL -- I caused such envelope to be deposited in the mail at Huntington Beach,
California I am "readily familiar"with the firm's practice of collection and processing
correspondence for mailing It is deposited with U S Postal Service on that same day
in the ordinary course of business, with postage thereon fully prepaid I am aware
that, on motion of a party served, service is presumed invalid if postal cancellation date
or postage meter date is more than 1 day after date of deposit for mailing in the
affidavit
b [ ] BY MAIL -- By depositing a true copy thereof in a sealed envelope with postage
thereon fully prepaid in the United States mail at Huntington Beach, California,
addressed to the address shown above
c [ ] BY DELIVERY BY HAND to the office of the addressee
d [ ] BY PERSONAL DELIVERY to the person(s) named above
e [ ] BY FAX TRANSMISSION to No
I declare under penalty of perjury under the laws of the State of California that the
foregoing is true and correct
Executed on February 11, 2016, at Huntington Beach, California
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Dept ID ED-16-02 Page 1 of 2
Meeting Date 1/19/2016
7b.uez-b4
'
CITY OF HUNTINGTON BEACH
,�,� REQUEST FOR CITY COUNCIL ACTION
MEETING DATE: 1/19/2016
SUBMITTED TO: Honorable Mayor and City Council Members
SUBMITTED BY: Fred A Wilson, City Manager
PREPARED BY: Lori Ann Farrell, Director of Finance
Kellee Fritzal, Deputy Director, Business Development
SUBJECT: Adopt City Council Resolution No 2016-02 declaring its intention to consider an
Amendment to the Rate and Method for City of Huntington Beach Community
Facilities District (CFD) No 2000-1 (Grand Coast Resort/Hyatt) and scheduling a
public hearing for Feb,�.0^T22—,.16 A7, 4e_* :7, 2,0/,6
Statement of Issue
Due to the dissolution of redevelopment agencies in California, the Successor Agency was required
to sell all properties owned by the Agency On December 21, 2015, the Successor Agency
approved the sale of the Hyatt property to PCH Beach Resort LLC (the Mayer Corporation) Prior to
the close of escrow of the sale, the current Community Facilities District Bond (CFD) 2000-1 (Grand
Coast Resort), (the "District"), must be amended to adjust the method of the special tax so that the
Special Taxes, which secure approximately $12,000,000 in outstanding bonds, will be levied on the
fee interest in the property in the District rather than the leasehold interest
Financial Impact
There is no fiscal impact to the City The administrative and financial costs of the restricting the
method of tax apportionment will be paid by CFD 2000-1 (Grand Coast Resort)
Recommended Action
Adopt Resolution No 2016-02, "Resolution of the City Council of the City of Huntington Beach
Acting as the Legislative Body of City of Huntington Beach Community Facilities District No 2000-1
(Grand Coast Resort) Declaring its Intention to Consider an Amendment to the Rate and Method of
Apportionment of Special Tax "
Alternative Action(s)
Do not approve the Resolution and direct staff as necessary
Analysis
Community Facility Districts issue bonds to construct public improvements in specific areas With
approval of the City Council, property or leasehold owners can approve a district by a vote Any
changes to the district must also be approved by the leasehold or property owners, and the City
Council/Successor Agency
The Grand Coast Resort Community Facilities District 2000-1 (the CFD) has a single leasehold
owner, PCH Beach Resort LLC The Successor Agency owned the land, which was leased to the
PCH Beach Resort LLC on a 99 year ground lease Each year the CFD levied an assessment on
the leasehold interest to fund the annual debt service and other necessary expenses Now that the
HB -167- Item 6. - 1
Dept ID ED-16-02 Page 2 of 2
Meeting Date 1/19/2016
property is being sold to PCH Beach Resort LLC, the method of apportionment to collect sufficient
funds to pay the debt on the CFD bonds must be legally changed so that it is levied on the fee
interest in the property, rather than the leasehold Interest PCH Beach Resort LLC will continue to
pay the levy This change does not affect the amount of taxes collected by the CFD, or any of the
debt service It is merely a change in the legal definition of the levy PCH Beach Resort LLC has
agreed to fund all of the expenses associated with these changes
PCH Beach Resort LLC has formally requested these changes in the attached document, "Petition
for changes to City of Huntington Beach Community Facilities District No 2000-1 (Grand Coast
Resort) The property cannot be sold to PCH Beach Resort LLC if these changes to the Rate and
Method are not made
Below is a timeline of additional future actions required if this Resolution is approved
A<WCW :7, ,Z6/6
• A Public Hearing on the changes to the levy of special taxes in accordance with the new
method of apportionment shall be held on Fe 6 The Council may then adopt
the resolution authorizing the change in method There will also be an "Introduction of the
Amended Ordinance Levying the Special Tax " A consent and waiver of election procedures
will need to be received and approved in order to have the election on the night of the Public
Hearing
• On March 7, 2016, the amended ordinance would be adopted and bond documents would
have to be amended The ordinance would be effective on April 6, 2016
When the land sale closes, the City will make necessary secondary market filings with bondholders
detailing the changes Staff will work with the City's consultant on the CFD, Willdan and Associates,
to ensure that the levies are all filed properly with the Orange County Auditor Controller
Environmental Status
Not Applicable
Strategic Plan Goal
Strengthen Economic and Financial Sustainability
Attachment(s)
1) Resolution No 2016-02, "Resolution of the City Council of the City of Huntington Beach
Acting as the Legislative Body of City of Huntington Beach Community Facilities District No
2000-1 (Grand Coast Resort) Declaring its Intention to Consider an Amendment to the Rate
and Method of Apportionment of Special Tax"
2) Petition for Changes to City of Huntington Beach Community Facilities District No 2000-1
(Grand Coast Resort)
0
Item 6. - 2 HB -168-
ATTACHMENT # 1
RES OLUTION NO. 2 016-0 2
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH, ACTING AS THE LEGISLATIVE BODY OF
CITY OF HUNTINGTON BEACH COMMUNITY FACILITIES
DISTRICT NO. 2000-1 (GRAND COAST RESORT), DECLARING ITS
INTENTION TO CONSIDER AN AMENDMENT TO THE RATE AND
METHOD OF APPORTIONMENT OF SPECIAL TAX
WHEREAS, on Januaiy 18, 2000, the City Council of the City of Huntington
Beach (the "City Council") adopted Resolution No. 2000-5 stating its intention to
establish City of Huntington Beach Community Facilities District No. 2000-1 (Giand
Coast Resort) (the "District") pursuant to Chapter 3.56 (commencing with Section
3 56 010) of the Municipal Code (the "Code") of the City of Huntington Beach (the
"City") and the Mello-Roos Community Facilities Act of 1982, as amended, being
Chapter 2 5 of Part 1 of Division 2 of Title 5 of the Goveinnient Code of the State of
California(the "Act"); and
The boundaries of the District are shown on the Boundary Map recorded on
Septembei 14, 1999 in Book 78 of Maps of Assessment and Community Facilities
Districts at Page 49 and as instrument nurizbei 20000038289 in the Office of the Clerk-
Recorder of the County of Orange; and
A notice calling a public hearing, was published as required by law relative to the
intention of the City Council to establish the District, which public heating was continued
to April 17, 2000, and
On April 17, 2000, the City Council conducted a noticed public hearing to
determine whether to proceed with the formation of the District, issue bonds to pay for
improvements and incidental expenses related thereto foi the benefit of the District, and
authorize the levy of special taxes (the "Special Tax") pursuant to the rate and method of
apportionment of a special tax in the form attached to Resolution No 2000-5 (the "Rate
and Method") for the purposes described in Resolution No 2000-5, and
At the April 17, 2000 public hearing all persons desiring to be heard on all matters
pertaining to the formation of the District, the levy of a special tax in accordance with the
Rate and Method and the issuance of bonds for the benefit of said District to pay foi the
cost of the certain improvements and incidental expenses permitted by the Code and the
Act were heard and a full and fair hearing was held; and
16-5071/130523 1
Resolution No . 2016-02
Pursuant to Resolution No 2000-35 adopted on Apul 17, 2000 (the "Resolution
'of Formation"), the City Council determined that, under Sections 3 56 070 and 3 56 040
of the Code, in order to carry out the purposes of the Code, and for the City and the
former Redevelopment Agency of the City of Huntington Beach (the "Agency") to carry
out their respective purposes, the Agency is a public agency subject to the Special Tax,
and
Pursuant to the Resolution of Formation, the City Council determined that,
pursuant to the Code, the Agency, as the then fee title owner of the land within the
District, is a public agency landowner, and as such, was entitled to cast votes based on
such ownership of land for the special electron to authorize the issuance of bonds for the
benefit of the District, the levy of Special Tax within the District and the establishment of
an appropriations limit for the District; and
On April 17, 2000, after the public hearing, the District held a special electron in
which the Agency, as sole property owner within the District, approved the levy of a
special tax and the issuance of bonds for the benefit of the District and established an
appropriations limit for the District, and
Pursuant to Resolution No. 2000-38, adopted on April 17, 2000, the City Council,
acting as the legislative body of the District, declared the results of the special election
and directed the recording of a Notice of Special Tax Lien within the District; and
Pursuant to Ordinance No 3519 (the "Ordinance"), the City Council, acting as the
legislative body of the District, authorized the levy of special taxes within the District
pursuant to the Rate and Method, and
Pursuant to the Act, the Rate and Method and the Resolution of Formation, the
Special Tax is levied on the leasehold interests in Taxable Property (as defined in the
Rate and Method) within the District, and all property within the District owned by
entities of the State of California and federal and local governinents not subject to a
leasehold interest, is exempt from the Special Tax, and
The Agency, as lessor, and PCH Beach Resort, LLC, a California limited liability
company ("PCH Beach Resort"), as lessee, entered into a Ground Lease dated April 4,
2001 (the "Lease"), pursuant to which the Agency leased to PCH Beach Resort all of the
land within the District for a term of 99 years, and
Pursuant to Assembly Bill No 26 ("AB X126") adopted on June 28, 2011, the
Agency was dissolved and, pursuant to Resolution 2012-01 adopted on January 9, 2012,
the City Council of the City elected to have the City serve as the successor to the Agency;
and
The City, as successor to the Agency (the "Successor Agency") is the current fee
title owner to the land within the District and has succeeded to all rights, obligations and
covenants under the Lease, and
16-5071/130523 2
The Califoinia Department of Finance has approved the Successor Agency's long
range property management plan, which directs the Successor Agency to sell and
otherwise dispose of its real property assets, including, but not limited to, the land within
the District, and
The Successor Agency proposes to sell and convey fee title to the land within the
District to PCH Beach Resort and the District has received a petition from PCH Beach
Resort (the "Petition") to amend and restate the Rate and Method in the foim attached
hereto as Attachment "A" (the "Amended and Restated Rate and Method"), to, among
other things, provide that, in connection with such proposed sale and conveyance of the
property, the Special Tax will thereafter be levied on the fee interest in the property
within the District as described in the Amended and Restated Rate and Method, and
Pursuant to the Petition and Section 53331 of the Act, the City desires to initiate
proceedings to amend and testate the Rate and Method as described herein, and
The District furthei desires to authorize the submittal of a certain proposition to
the qualified electors of the District, being the landowner within the District, all as
authorized and iequired by law.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH, ACTING AS THE LEGISLATIVE BODY OF CITY OF
HUNTINGTON BEACH COMMUNITY FACILITIES DISTRICT NO 2000-1
(GRAND COAST RESORT), DOES HEREBY RESOLVE, ORDER AND
DETERMINE AS FOLLOWS
1 Each of the above recitals is true and coriect and is adopted by the
legislative body of the District
2 The City Council, acting as the legislative body of the Distiict, declares
that public convenience and necessity iequiie changes to the Rate and Method and furlhei
declares its intention to conduct proceedings pursuant to Section 53331 of the Act to
consider restating and amending the Rate and Method with the Amended and Restated
Rate and Method
3 A public hearing (the "Healing") on the changes to the levy of special
taxes in accordance with the Amended and Restated Rate and Method of Appoitionment
shall be held at 6 00 p in , of as soon thereafter as practicable, on March 7, 2016, at City
Hall, 2000 Main Street, Huntington Beach, California Should the City Council
determine to submit the proposed amendments described in Section 2 above, to the
qualified electors of the District, a special electron will be held to authorize such changes
in accordance with the procedures contained in the Code and the Act, including
Goverinment Code Sections 53326 and 53353 5 If such election is held, the proposed
voting procedure at the election will be a landowner vote with each owner of land who is
the owner of land within the District at the close of the Healing, of the authorized
representative thereof, having one vote for each acre of portion thereof owned within the
District Pursuant to Section 3 56 070 of the Code, PCH Beach Resort, having a
16-5071/130523 3
R--solution No . 2016-02
leasehold interest in the land within the District for a teen exceeding 40 years, is an
owner of land not exempt fiom the Special Tax within the District. Ballots for the special
election may be distributed by mail of by personal service.
4 At the time and place set forth above for the Hearing, any interested
person, including all persons owning lands or registered to vote within the District, may
appear and be heard.
5 The City Clerk is hereby directed to publish a notice (the "Notice") of the
Hearing pursuant to Section 6061 of the Government Code in a newspaper of general
circulation published in the area within the District The City Clerk is further directed to
mail a copy of the Notice to each of the landowners within the boundaries of the District,
at least 15 days prior to the Hearing The Notice shall contain the text or a summary of
this Resolution, the time and place of the Hearing, a statement that the testimony of all
interested persons or taxpayers will be heard, a description of the protest rights of the
registered voters and landowners in the District and a description of the proposed voting
procedure for the election iequned by the Act. Such publication shall be completed at
least seven (7) days prior to the date of the Hearing.
6. This Resolution shall be effective upon its adoption
PASSED, APPROVED AND ADOPTED this 19 t hday of January , 2016
4i��
May
REVIE ED AND APPROVED APPROVED AS TO FORM:
Crt la ei City Attorney
c
ED ND APP OVED
City Manager
16-5071/130523 4
Resolution No . 2016-02
ATTACHMENT "A"
AMENDED AND RESTATED RATE AND METHOD OF APPORTIONMENT
FOR CITY OF HUNTINGTON BEACH
COMMUNITY FACILITIES DISTRICT NO. 2000-1 (GRAND COAST RESORT)
A Special Tax applicable to each Assessor's Parcel of Taxable Pioperty in the City of Huntington Beach
Community Facilities Disti ict No 2000-1 (Gi and Coast Resoi t) (her ein CFD No 2000-1) shall be levied
and collected according to the tax liability deteimined by the Administiatoi thiough the application of the
pioceduies described below The teal property in CFD No 2000-1, unless exempted by law of by the
provisions hereof, shall be taxed for the purposes,to the extent, and in the manner herein provided
DEFINITIONS
The capitalized terms hereinafter set forth have the following meanings when used in this Amended and
Restated Rate and Method of Apportionment
Acre or Acreage means the land area of an Assessoi's Parcel as shown on an Assessoi's Parcel Map, of
if the land area is not shown on an Assessor's Paicel Map, the land area shown on the applicable final
map, parcel map, of the other parcel snap iecoided with the County Recoidei. If the Acreage of a
particular Paicel is unclear aflei reference to available maps, the Administiator shall determine the
appropriate Acreage fot a Paicel.
Act means Chapter 3 56 (commencing with Section 3 56 010) of the Municipal Code of the City of
Huntington Beach and, as applicable, the Mello-Roos Community Facilities Act of 1982, as amended,
being Chapter 2 5 (commencing with Section 53311), Part 1, Division 2, of Title 5 of the Goveinment
Code of the State of California
Administrative Expenses means any of all of the following actual of reasonably estimated costs duectly
ielated to the administiation of CFD No 2000-1 the fees and expenses of any Fiscal Agent of trustee
(including any fees and expenses of its counsel) employed in connection with any Bonds, any costs
associated with the marketing of temaiketing of the Bonds, the expenses of the Administiator and the
City in cai yi ng out then duties undei any Indenture of iesolution with tespect to the Bonds, including,
but not limited to, the levy and collection of the Special Tax, the fees and expenses of legal counsel,
charges levied by the County of any division of office thereof in connection with the levy and collection
of Special Taxes, audits, continuing disclosuie of other amounts needed to pay arbitrage iebate to the
federal government with tespect to Bonds, costs associated with complying with continuing disclosure
iequtiements, costs associated with responding to public inquiries iegaiding Special Tax levies and
appeals, attorneys' fees and othei costs associated with commencement of pursuit of foreclosure fot
delinquent Special Taxes, and all other costs and expenses of City, the Administiatoi, the County, and
any Fiscal Agent, escrow agent of trustee related to the administiation of CFD No 2000-1
Administrator means the Dnectot of Economic Development of such othei person of entity designated
by the City Adinmistiative Officer of the City Council to adtministei the Special Tax according to this
Amended and Restated Rate and Method of Apportionment of Special Tax
Assessor's Parcel or Parcel means a lot, parcel of airspace pai cel shown on an Assessoi's Paicel Map
with an assigned Assessor's Paicel number
Assessor's Parcel Map means an official map of the Assessor of tine County designating Parcels by
Assessoi's Paicel numbei
A-1
Resolution No . 2016-02
Bonds mean any bonds or other debt(as defined in Section 53317(d) of the Act), whether in one of more
series, issued by the City foi CFD No 2000-1 under the Act
City means the City of Huntington Beach
City Council means the City Council of the City of Huntington Beach, acting as the legislative body of
CFD No 2000-1
County means the County of Oiange
Exempt Land means (1) any real pioperty within the boundaries of CFD No 2000-1 which is owned by
a governmental agency foi public sight-of-way purposes including, but not limited to, streets, public
walkway corridors, and slopes as determined in each Fiscal Year by the Admmistiatoi or (2) any
Assessor's Parcel for which the Special Tax has been paid in full
Fiscal Agent means the fiscal agent who is a party to the Indenture, if so approved
Fiscal Year means the period commencing on July 1 and ending on the following June 30, in any year in
which the Bonds are outstanding
Indenture means the indenture, fiscal agent agreement, resolution or other instrument approved pursuant
to the Resolution of Issuance and pursuant to which Bonds are issued, as modified, amended and/or
supplemented fiom time to time, and any instrument replacing of supplementing the same
Maximum Special Tax means, with respect to any Parcel of Taxable Property, the maximum Special
Tax, determined in accordance with Section C, that can be levied in any Fiscal Year on such Parcel.
Outstanding Bonds means all Bonds which are then outstanding under the Indenture
Reserve Fund means the fund of that name created under the Indenture
Resolution of Issuance means the resolution adopted by the City Council of the City, acting as the
legislative body of CFD No 2000-1, author rznig the issuance of the Bonds in accoi dance with the Act
Special Tax means the special tax to be levied pursuant to the Act and this Amended and Restated Rate
and Method of Apportionment of Special Tax in each Fiscal Year on Taxable Property within CFD
No 2000-1
Special Tax Requirement means the amount required in any Fiscal Year foi CFD No 2000-1 necessary
(i)to pay the annual scheduled debt service on the Outstanding Bonds due in the calendar year which
commences in such Fiscal Year, (ii)to pay any amounts iequued to establish of replenish the Reserve
Fund foi all Outstanding Bonds, (ni)to pay Administi ative Expenses, and (iv)to pay costs of any ci edit
enhancement (including fees and expenses related to any letter of credit) foi the Bonds, and less a credit
for available funds determined pursuant to the Indenture
Taxable Property means all of the Assessor's Parcels within the boundaries of CFD No 2000-1, which
are not Exempt Land of exempt from the Special Tax pursuant to law
Trustee means the trustee who is a party to the Indenture, if so approved
A-2
Resolution No . 2016-02
B. IDENTIFYING TAXABLE PROPERTY
Not less than fifteen business days prrot to the beginning of each Fiscal Year, the Admmtstrator shall
determine which Parcels in CFD No 2000-1 ate Taxable Property The Taxable Property shall be subject
to Special Taxes in accordance with the rate and method of apportionment described in Sections C and D
below
C. MAXIMUM SPECIAL TAX
The Maximum Special Tax for Taxable Pt operty in CFD No 2000-1 shall be the gt eater of(1) $130,000
pet Act e or (2)the amount determined put suant to the following steps
Step 1 Detetmme the maximum annual debt service on all Outstanding Bonds,
Step 2 Multiply the total debt set-vice determined in Step 1 by 1 1 and add the Adnnmistratrve Expenses,
Step 3 Determine the Acreage of Taxable Property within the CFD No 2000-1,
Step 4. Divide the amount from Step 2 by the Acreage Boni Step 3 to determine the Maximum
Special Tax per Acre of Taxable Property.
D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX
Commencing with Fiscal Year 2000-2001, and for each Fiscal Yeat thet eafter, the City Council shall levy
the Special Tax proportionately on each Assessor's Patcel of Taxable Property at up to 100% of the
Maximum Special Tax, as determined by reference to Section C, above, as needed to satisfy the Special
Tax Requirement
E. LIMITATIONS
No Special Taxes shall be levied on any Parcel after such Pat eel becomes Exempt Land
The Special Tax may be levied and collected on Taxable Property commencing with Fiscal Year 2000-
2001, and for each Fiscal Year theteaftet, and until the date on which ptmcipal and interest on all
Outstanding Bonds have been paid in full (or ptovtsron for their payment has been made) Upon
detetmmatron by the Administrator that this requirement has been met, the Special Tax lien shall be
t emoved fi onn all Pat cel s in CFD No 2000-1
F. MANNER OF COLLECTION
The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem
property taxes, ptovrded, however, that CFD No 2000-1 may directly bill the special tax, may collect
special taxes at a different time or in a manner if necessary to meet its financial obligations, and may
covenant to foreclose and may actually foreclose on delinquent Assessor's Parcels as permitted by the
Act
G. APPEALS
The City Council shall establish as part of the proceedings and administration of CFD No. 2000-1, a
special three-member Review/ Appeal Committee. The Review/ Appeal Committee shall interpret this
Amended and Restated Rate and Method of Apportionment and make determinations relative to the
annual administration of the Special Tax and any appeals, as herein specified Any owner of Taxable
A-3
Resolution No . 2016-02
Property within CFD No 2000-1 claiming that the amount of application of the Special Tax is not correct
may file a written notice of appeal with the Review/Appeal Committee not later than one calendar year
after having paid the Special Tax that is disputed The Review/Appeal Committee shall promptly review
the appeal, and if necessary, meet with the owner of the Taxable Property, consider wiitten and oral
evidence regarding the amount of the Special Tax, and resolve the appeal If the Review / Appeal
Committee's decision iequues the Special Tax to be modified or changed in favoi of the owner of the
Taxable Property, a cash refund shall not be made(except for the last year of the levy), but an adjustment
shall be made to the next Special Tax levy This procedure shall be exclusive and its exhaustion by any
owner of Taxable Property shall be a condition precedent to any legal action by such owner
H. PREPAYMENT OF SPECIAL TAX
The following definitions apply solely to this Section H
Outstanding Bonds means all Pieviously Issued Bonds which are deemed to be outstanding under the
Indenture aftei the first interest and/of principal payment date following the current Fiscal Yeai
Previously Issued Bonds means all Bonds that have been issued by CFD No 2000-1 prroi to the date of
prepayment
1. Prepayment in Full
The Special Tax applicable to any Assessor's Paicel of Taxable Property may be prepaid The Special
Tax obligation applicable to such Assessor's Paicel in CFD No 2000-1 may be fully prepaid and the
obligation of such Assessor's Paicel to pay the Special Tax permanently satisfied as described heiem
The owner of Taxable Property intending to prepay the Special Tax obligation on one of a combination of
Assessor's Parcel(s) shall provide the Admnusti atoi with wi itten notice of intent to pi epay Following
receipt of such notice, the Administiatoi shall notify the owner of such Assessor's Paicel of Paicels of the
prepayment amount of such Assessor's Paicel(s) The Administi atoi may charge a i easonable fee foi
providing this figure Piepayment must be made not less than 45 days prroi to the next occuu-mg date
that notice of redemption of Bonds f►om the proceeds of such prepayment may be given by the Fiscal
Agent pui suant to the Indenture
The Prepayment Amount (defined below) shall be calculated as summai ized below (capitalized teens as
defined below)-
Bond Redemption Amount
Plus Redemption Piemium
Plus Defeasance Amount
Plus Administrative Fees and Expenses
Less Reserve Fund Ci edit
Less Capitalized Inteiest Credit
Total Equals Piepayment Amount
As of the proposed date of prepayment, the Piepayment Amount (defined below) shall be calculated as
follows•
Pai ag_i aph No
1. Foi Assessor's Paicels of Taxable Property intending to prepay, compute the Maximum Special
Tax foi such Assessor's Parcels
A-4
Resolution No . 2016-02
2 Divide the Maximum Special Tax computed pursuant to Paiagraph 1 by the total Maximum
Special Tax of all Assessor's Paicels of Taxable Pioperty in CFD No 2000-1, excluding any
Assessor's Parcels which have prepaid their Special Taxes in full
3 Multiply the quotient computed pursuant to Paiagraph 2 by the Outstanding Bonds as defined in
this Section H to compute the amount of Outstanding Bonds to be retired and prepaid, and found
the result up to the neaiest multiple of$5,000(the Bond Redemption Amount)
4 Multiply the Bond Redemption Amount computed pursuant to Paragraph 3 by the applicable
redemption piennium, if any, on tine Outstanding Bonds to be iedeemed (the Redemption
Premium)
5 Compute the amount needed to pay interest on the Bond Redemption Amount fiorn the first bond
interest and/ of puncipal payment date following the current Fiscal Yeai until the earliest
redemption date for the Outstanding Bonds
6. Determine the Special Taxes levied on the Assessor's Parcel in tine current and any previous
Fiscal Year, which have not yet been paid
7 Compute the amount the Administrator reasonably expects to dei ive fi om the reinvestment of the
Prepayment Amount from the date of prepayment until the redemption date for the Outstanding
Bonds to be redeemed with the prepayment
8 Add the amounts computed pursuant to Paragraphs 5 and 6 and subtract the amount computed
pursuant to Paiagraph 7 (the Defeasance Amount)
9 Determine the administrative fees and expenses of CFD No 2000-1, including the costs of
computation of the prepayment, the costs to invest the prepayment pioceeds, the costs of
redeeming Bonds, and the costs of iecoiding any notices to evidence the prepayment and the
redemption(tine Administrative Fees and Expenses)
10 Determine the reserve fund credit (the Reserve Fund Credit) which shall equal the lesser of
(a)the expected reduction in the reserve requirement (as defined in the Indenture), if any,
associated with the iedemption of Outstanding Bonds as a result of the prepayment, or (b) the ,
amount der ived by subti acting the new reserve i equu ement(as defined in the Indenture) in effect
after the redemption of Outstanding Bonds as a result of the piepayment from the balance in the
reserve fund on the piepayment date, but in no event shall such amount be less than zero
11 If any capitalized interest for the Outstanding Bonds will not have been expended at the time of
the first interest and/of principal payment following tine current Fiscal Year, a capitalized interest
credit shall be calculated by multiplying the quotient computed pursuant to Paragiaph 2 by the
expected balance in the capitalized interest fund after such first interest and/of principal payment
(the Capitalized Interest Credit)
12 The Special Tax piepayment is equal to the sum of the amounts computed pursuant to Paragraphs
3, 4, 8 and 9, less the amounts computed pursuant to Paragraphs 10 and 11 (the Piepayment
Amount)
13 Fi om the Pi epayment Amount, the amounts computed pui suant to Par agi aphs 3, 4, 8, 10 and 11
shall be deposited into the appropriate fund as established under the Indenture and be used to
A-5
Resolution NO . 2016-02
retire Outstanding Bonds of make debt service payments The amount computed pursuant to
Pal agiaph 9 shall be ietamed by the Administratoi
As a result of the payment of the current Fiscal Year's Special Tax levy as determined under Paragiaph 6
(above), the Administi atoi shall remove the curl ent Fiscal Year's Special Tax levy for such Assessor's
Paicel fi om the County tax i olls, With respect to any Assessor's Parcel that is pi epaid, the City Council
shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of
Special Taxes and the release of the Special Tax lien on such Assessor's Paicel, and the obligation of
such Assessor's Pal eel to pay the Special Tax shall cease
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the amount of the
Maximum Special Taxes that may be levied on Taxable Property within CFD No 2000-1 both prior to
and after the proposed prepayment is at least 1 1 times the maximum annual debt service on all
Outstanding Bonds
2. Prepayment in Part
The Maximum Special Tax on an Assessor's Parcel of Taxable Property may be partially prepaid The
amount of the prepayment shall be calculated as un Section H 1, except that a partial prepayment shall be
calculated according to the following formula
PP=(PH xF)+ G
Whei e these tei ms ai e defined as follows
PP = the partial prepayment
PH = the Prepayment Amount calculated accoidmg to Section H 1, minus the amounts deteimined in
Paragiaph No 6 and 9 of Section H 1
F = the percent by which the owner of the Assessoi's Paicel(s) is partially prepaying the Maximum
Special Tax
G = the amounts determined in Pal agiaph No 6 and 9 of Section H 1
The owner of an Assessor's Paicel who desues to partially prepay the Maximum Special Tax shall notify
the Administrator of (i) such owner's intent to partially piepay the Maximum Special Tax, (n)the
percentage by which the Maximum Special Tax shall be pi epaid, and(iii)the company of agency that will
be acting as the escrow agent, if applicable The Admunrstiatoi shall provide the owner of the Assessor's
Paicel with a statement of the amount i equu ed foi the partial pi epayment of the Maxunum Special Tax
foi an Assessor's Paicel following receipt of the request
With respect to any Assessor's Paicel that is partially prepaid, CFD No 2000-1 shall (i)distribute the
funds remitted to it accoi ding to Pai agraph 13 of Section H 1, and (u) indicate ill tine i ecoi ds of CFD
No 2000-1 that thei e has been a partial pi epayment of the Maximum Special Tax and that a portion of the
Maximum Special Tax equal to the outstanding per centage (1 00- F) of the i emaming Maximum Special
Tax shall continue to be author ized to be levied on such Assessor's Parcel pursuant to Section D.
A-6
Resolution No . 2016-02
The California Department of Finance has approved the Su/edland
cy's long
range property management plan, which directs the Successoro sell_ and
otherwise dispose of its real property asset,, including, but not limiland within
the District; and
The Successor Agency proposes to sell and convey fee title within the
District to PCH Beach Resort and the District has received a petrCH Beach
Resort (the "Petition") to amend and restate the Rate and Methodm attached
hereto as Attachment "A" (the "Amended and Restated Rate and , to, among
other things, provide that, in connection with such proposed sale and conveyance of the
property, the Special Tax will thereafter be levied on the fee nterest in the property
within the District as described in the Amended and Restated Rae and Method; and
Pursuant to the Petition and Section 53331 of the Act', the City desires to initiate
proceedings to amend and restate the Rate and Method as d �cribed herein, and
The District further desires to authorize the subs ittal of a certain proposition to
the qualified electors of the District, being the land ner within the District, all as
authorized and required by law.
NOW, THEREFORE, THE CITY C UNCIL OF THE CITY OF
HUNTINGTON BEACH, ACTING AS THEJILITIES
GISLATIVE BODY OF CITY OF
HUNTINGTON BEACH COMMUNITY DISTRICT NO. 2000-1
(GRAND COAST RESORT), DOES H RE-BY RESOLVE, ORDER AND
DETERMINE AS FOLLOWS
1 Each of the above recitals 's true and correct and is adopted by the
legislative body of the District
2 The City Council, acting as the legislative body of the District, declares
that public convenience and necessity r quire changes to the Rate and Method and further
declares its intention to conduct pro eedings pursuant to Section 53331 of the Act to
consider restating and amending th Rate and Method with the Amended and Restated
Rate and Method
3. A public healing the "Hearing") on the changes to the levy of special
taxes in accordance with the A ended and Restated Rate and Method ofAp_Q ent
shall be held at 6 00 p in , or s soon thereafter as practicable, on kabruary 22, 2016 t
City Hall, 2000 Main Stree , Huntington Beach, California Should the City Council
determine to submit the oposed amendments described in Section 2 above, to the
qualified electors of the strict, a special election will be held to authorize such changes
in accordance with th procedures contained in the Code and the Act, including
Government Code Sec ions 53326 and 53353.5. If such election is held, the proposed
voting procedure at t election will be a landowner vote with each owner of land who is
the owner of land ithin the District at the close of the Hearing, or the authorized
representative ther of, having one vote for each acre or portion thereof owned within the
District Pursua t to Section 3 56 070 of the Code, PCH Beach Resort; hawing�a
16-5071/130523 3 ����i ��'.I �,
The California Department of Finance has approved the Successor Agency's long
range property management plan, which directs the Successor Agency to sell and
otherwise dispose of its real property assets, including, but not limited to, the 1 d within
the District, and
The Successor Agency proposes to sell and convey fee title to the rid within the
District to PCH Beach Resort and the District has received a petition om PCH Beach
Resort (the "Petition") to amend and testate the Rate and Method in he foam attached
hereto as Attachment "A" (the "Amended and Restated Rate and ethod"), to, among
other things, provide that, in connection with such proposed sale d conveyance of the
property, the Special Tax will thereafter be levied on the fee ' terest in the property
within the District as described in the Amended and Restated R e and Method, and
Pursuant to the Petition and Section 53331 of the A , the City desires to initiate
proceedings to amend and testate the Rate and Method as d sciibed herein, and
The District further desires to authorize the su mittal of a certain proposition to
the qualified electors of the District, being the la i owner within the District, all as
authorized and tequiied by law.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH, ACTING AS T LEGISLATIVE BODY OF CITY OF
HUNTINGTON BEACH COMMUNITY FACILITIES DISTRICT NO 2000-1
(GRAND COAST RESORT), DOE HEREBY RESOLVE, ORDER AND
DETERMINE AS FOLLOWS•
1. Each of the above ie itals is true and correct and is adopted by the
legislative body of the District.
2 The City Council acting as the legislative body of the District, declares
that public convenience and nec ssity require changes to the Rate and Method and fuithei
declares its intention to cond ct proceedings pursuant to Section 53331 of the Act to
consider restating and amen ing the Rate and Method with the Amended and Restated
Rate and Method
3 A public Waring (the "Hearing") on the changes to the levy of special
taxes in accordance wi i the Amended and Restated Rate and Method of Apportionment
shall be held at 6 00 in , or as soon thereafter as practicable, on Febivary 16, 2016, at
City Hall, 2000 Ma Street, Huntington Beach, California Should the City Council
determine to sub t the proposed amendments described in Section 2 above, to the
qualified electors f the District, a special election will be held to authorize such changes
in accordance th the procedures contained in the Code and the Act, including
Government Co e Sections 53326 and 53353 5 If such election is held, the proposed
voting procedur at the election will be a landowner vote with each owner of land who is
the owner of land within the District at the close of the Hearing, or the authorized
representative hereof, having one vote for each acre or portion thei eof owned within the
District Pursuant to Section 3 56 070 of the Code, PCH Beach Resort, having-a
16-5071/130523 3
i
CITY OF HUNTINGTON BEACH
INTER-DEPARTMENTAL COMMUNICATION
DATE: January 19, 2016
TO: Honorable Mayor and City Council Members
FROM: Lori Ann Farrell Harrison,Director of Finance
Kellee Fritzal, Deputy Director, Business Development
RE: January 19,2016 City Council Agenda- Consent Calendar Item No. 6
Please note that page 2 of the Request for Council Action and page 3 of Resolution 2016-02
incorrectly list the date of February 22, 2016 The correct date should be February 16, 2016
The Resolution has been changed to reflect the correct date
Should you have any questions about this correction, please contact Sunny Han at extension
5907
SUPPLEMENTAL
COMMUNICATION
Meeting Date: / /9 —,D/6
Agenda Item No. 6
Resolution No. 2016-02
ORIGINAL
The California Department of Finance has appioved the Successot Agency's long
range property management plan, which directs the Successor Agency to sell and
otherwise dispose of its real ptoperty assets, including, but not luurted to, the land within
the District; and
The Successoi Agency proposes to sell and convey fee title to the land within the
District to PCH Beach Resort and the District has received a petition Gom PCH Beach
Resort (the "Petition") to amend and testate the Rate and Method in the form attached
hereto as Attachment "A" (the "Amended and Restated Rate and Method"), to, among
othei things, provide that, in connection with such pioposed sale and conveyance of the
property, the Special Tax will thereafter be levied on the fee interest in the property
within the Dish ict as described in the Amended and Restated Rate and Method; and
Pursuant to the Petition and Section 53331 of the Act, the City desires to initiate
proceedings to amend and testate the Rate and Method as described herein; and
The District further desires to authorize the submittal of a certain pl oposition to
the qualified electors of the District, being the landowner within the District, all as
authorized and tequired by law.
NOW, THEREFORE, THE CITY COUNCII, OF TIIE CITY OF
HUNTINGTON BEACH, ACTING AS THE L1-GISI.ATIVE BODY OF CITY Of
HUNTINGTON BEACH COMMUNITY FACILITIES DISTRICT NO, 2000-1
(GRAND COAST RESORT), DOES HEREBY RLSOLVE, ORDER AND
DETERMINE AS FOLI.OWS-
I. Each of the above tecitals is true and colrect and is adopted by the
legislative body of the Disti ict.
2. The City Council, acting as the legislative body of the District, declares
that public convenience and necessity require changes to the Rate and Method and further
declares its intention to conduct proceedings pursuant to Section 53331 of the Act to
consider restating and amending the Rate and Method with the Amended and Restated 4
Rate and Method
3. A public hearing (the "Hearing") on the changes to the levy of special
taxes in accordance with the Amended and Restated Rate and Method of Apportionment
shall be held at 6:00 p ill., of as soon thereaftei as practicable, on ebruary 22, 2016, at
City Hall, 2000 Main Street, Huntington Beach, California. Should the City ouncil
determine to submit the ptoposed amendments described in Section 2 above, to the
qualified electors of the District, a special election will be held to authorize such changes 1
in accordance with the procedures contained in the Code and the Act, including
Government Code Sections 53326 and 53353.5. If such electron is held, the proposed
voting procedure at the election will be a landowner vote with each owner of land who is
the owner of land within the District at the close of the Hearing, or the authorized
representative thereof, having one vote for each acre of poition thereof owned within the
District. Pulsuamt to Section 3,56.070 of the Code, PCH Beach Resort, having a
16-5071/130523 3
AMENDED
The California Department of Finance has approved the Successor Agency's long
range property management plan, which directs the Successoi Agency to sell and
otherwise dispose of its seal property assets, including, but not limited to, the land within
the District; and
The Successoi Agency proposes to sell and convey fee title to the land within the
District to PCH Beach Resort and the District has received a petition from PCH Beach
Resort (the "Petition") to amend and i estate the Rate and Method in the form attached
hei eto as Attachment "A" (the "Amended and Restated Rate and Method"), to, among
other things, provide that, in connection with such proposed sale and conveyance of the
property, the Special Tax will thereafter be levied on the fee interest in the property
within the District as described in the Amended and Restated Rate and Method, and
Pursuant to the Petition and Section 53331 of the Act, the City desires to imtnate
proceedings to amend and testate the Rate and Method as described herein, and
The District furthei desires to authorize the submittal of a certain proposition to
the qualified electors of the District, being the landownei within the District, all as
authorized and iequiied by law.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH, ACTING AS THE LEGISLATIVE BODY OF CITY OF
HUNTINGTON BEACH COMMUNITY FACILITIES DISTRICT NO 2000-1
(GRAND COAST RESORT), DOES HEREBY RESOLVE, ORDER AND
DETERMINE AS FOLLOWS.
1. Each of the above recitals is true and correct and is adopted by the
legislative body of the District.
2. The City Council, acting as the legislative body of the District, declares
that public convenience and necessity iequne changes to the Rate and Method and further
declares its intention to conduct proceedings pursuant to Section 53331 of the Act to
consider restating and amending the Rate and Method with the Amended and Restated
Rate and Method
3 A public healing (the "Healing") on the changes to the levy of special
taxes in accoidance with the Amended and Restated Rate and Method of Apportionment
shall be held at 6:00 p.m., or as soon thereaftei as practicable, on ebivary 16, 20�at
City Hall, 2000 Main Street, Huntington Beach, California Should the City Council
determine to submit the proposed amendments described in Section 2 above, to the
qualified electors of the District, a special electron will be held to authorize such changes
in accordance with the procedures contained in the Code and the Act, including
Government Code Sections 53326 and 53353 5 If such election is held, the proposed
voting procedure at the election will be a landowner vote with each owner of land who is
the owner of land within the District at the close of the Hearing, or the authorized
representative thereof, having one vote for each acre of portion thereof owned within the
District Pursuant to Section 3 56 070 of the Code, PCH Beach Resort, having a
16-5071/130523 3
CORRECTED
Dept ID ED-16-02 Page 2 of 2
Meeting Date 1/19/2016
property is being sold to PCH Beach Resort LLC, the method of apportionment to collect sufficient
funds to pay the debt on the CFD bonds must be legally changed so that it is levied on the fee
interest in the property, rather than the leasehold interest PCH Beach Resort LLC will continue to
pay the levy This change does not affect the amount of taxes collected by the CFD, or any of the
debt service It is merely a change in the legal definition of the levy PCH Beach Resort LLC has
agreed to fund all of the expenses associated with these changes
PCH Beach Resort LLC has formally requested these changes in the attached document, "Petition
for changes to City of Huntington Beach Community Facilities District No 2000-1 (Grand Coast
Resort) The property cannot be sold to PCH Beach Resort LLC if these changes to the Rate and
Method are not made
Below is a timeline of additional future actions required if this Resolution is approved
• A Public Hearing on the changes to the levy of s eeccl taxes in accordance with the new
method of apportionment shall be held on February 16, 201�:)The Council may then adopt
the resolution authorizing the change in method There wi0 also be an "Introduction of the
Amended Ordinance Levying the Special Tax " A consent and waiver of election procedures
will need to be received and approved in order to have the election on the night of the Public
Hearing
• On March 7, 2016, the amended ordinance would be adopted and bond documents would
have to be amended The ordinance would be effective on April 6, 2016
When the land sale closes, the City will make necessary secondary market filings with bondholders
detailing the changes Staff will work with the City's consultant on the CFD, Willdan and Associates,
to ensure that the levies are all filed properly with the Orange County Auditor Controller
Environmental Status
Not Applicable
Strategic Plan Goal
Strengthen Economic and Financial Sustainability
Attachments)
1) Resolution No 2016-02, "Resolution of the City Council of the City of Huntington Beach
Acting as the Legislative Body of City of Huntington Beach Community Facilities District No
2000-1 (Grand Coast Resort) Declaring its Intention to Consider an Amendment to the Rate
and Method of Apportionment of Special Tax "
2) Petition for Changes to City of Huntington Beach Community Facilities District No 2000-1
(Grand Coast Resort)