To: MAYOR AND CITY COUNCIL
From: MARNI RUHLAND, FINANCE DIRECTOR
TITLE
title
DISCUSSION AND POSSIBLE ACTION REGARDING THE ISSUANCE OF LEASE REVENUE BONDS SERIES 2021A (FEDERALLY TAXABLE) BY THE REDONDO BEACH COMMUNITY FINANCING AUTHORITY
ADOPT RESOLUTION NO. CC-2106-065, A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDONDO BEACH, CALIFORNIA, APPROVING THE ISSUANCE OF LEASE REVENUE BONDS SERIES 2021A (FEDERALLY TAXABLE) BY THE REDONDO BEACH COMMUNITY FINANCING AUTHORITY; AUTHORIZING AND APPROVING A SITE AND FACILITY LEASE, A LEASE AGREEMENT, A PRELIMINARY OFFICIAL STATEMENT, A FINAL OFFICIAL STATEMENT, A CONTINUING DISCLOSURE AGREEMENT, A BOND PURCHASE AGREEMENT; AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH
end
EXECUTIVE SUMMARY
In February 2021, the City Council directed staff to work with the City's Bond Financing Team to structure a bond financing to refinance the City's Unfunded Accrued Liability ("UAL") with the California Public Employees' Retirement System ("CalPERS"). As reported to the Council, the City is expected to achieve substantial budgetary savings by refinancing its pension obligation. This item presents the Lease Revenue Bond financing documents needed for City Council to officially authorize the refinancing.
BACKGROUND
The City's pension plan is managed under contract by CalPERS. The City's annual pension payments to CalPERS consist of two components which include the Normal Cost and the UAL. The normal cost is the amount CalPERS charges the City, as a percentage of its payroll, that is estimated to annually fund a share of all future pension obligations. The UAL repayment portion is the amount that is charged to the City to repay the City's estimated long-term UAL that is owed to CalPERS for past changes in benefits, underperforming CalPERS investment returns, and changes in the discount rate.
The UAL represents the difference between the amount necessary to pay actuarially determined future benefits already ...
Click here for full text