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Home My WebLink About0 - PFCCITY OF NEWPORT BEACH PUBLIC FACILITIES CORPORATION ANNUAL MEETING NOTICE Tuesday, July 12, 2011 4:00 p.m. City Council Chambers 3300 Newport Blvd. Newport Beach, CA 92663 AGENDA Election of Officers Mayor Mayor Pro Tern Council Members City Manager Finance Director Chairperson of the Corporation Vice - Chairperson of the Corporation Corporation's Board of Directors Corporation's Secretary Corporation's Treasurer 2. Approval of Minutes from the meetings of July 27, 2010 and November 9, 2010 3. Receive, discuss as necessary, and file Financial Report from the Corporation's Treasurer 4. Public Comments S. Adjournment TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Finance Department Tracy McCraner, Finance Direotor/Treasurer 949 - 644 -3123, tmccraner @newportbeachca.gov PREPARED BY: Dan Matusiewicz, Deputy Finance Director APPROVED:" TITLE: Newport Beach Public Facilities Corporation ABSTRACT: The Bylaws of the Newport Beach Public Facilities Corporation call for an annual meeting of the Board of Directors. RECOMMENDATION: Convene the meeting of the City of Newport Beach Public Facilities Corporation for the 2011 -12 fiscal year, elect officers, approve minutes of the July 27, 2010, and November 9, 2010 meetings and receive and file this brief financial report. FUNDING REQUIREMENTS: There is no fiscal impact related to this item. DISCUSSION: A common and efficient way to finance public facilities is through the use of Certificates of Participation {COPS} but they are dependent on a lease revenue stream between two entities. The City of Newport Beach Public Facilities Corporation was first formed for this purpose in 1988 in order to specifically finance the acquisition and construction of the Cannery Village Parking Lot. The Corporation's role was later expanded to allow for the construction of public facilities, more generally, when financing of the Central Library construction was necessary in 1992. The City Council sits as the Board, with the City Manager serving as Secretary, and the Finance Director serving as Treasurer. Normally, the Mayor will serve as Chairperson of the Board, with the Mayor Pro -Tem serving as Vice - Chairperson. Newport Beach Public Facilities Corporation July 12, 2011 Page 2 In Fiscal Year 2010 -2011, $20,085,000 of Series 2010A (Tax Exempt) and $106,575,000 of Series 2010B (Federally Taxable Direct Pay Build America Bonds) Certificates of Participation were issued to provide financing for the acquisition, improving and equipping of a new Civic Center (which includes a new City Hall, an expansion to the Central Library, civic park and a parking structure). A portion of the Series 2010A Certificates were issued to refinance the $3,990,000 principal outstanding on the 1998 Library COPs resulting in a net present value savings of $429,500. Accordingly, the 1998 Library COPs have been defeased pursuant to the defeasance provisions of the 1998 Trust Agreement. The remaining proceeds from the Series 2010A Certificates and Series 20108 Certificates are to be used to finance the acquisition, improvement and equipping of the Civic Center Project. The current outstanding principal balance of the Series 2010A is $20,085,000 and the Series 2010B is $106,575,000. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). Submitted by Tracy Mc raner Finance rector/Treasurer Attachments: A. Minutes from July 27, 2010 B. Minutes from November 9, 2010 C. Financial Statements City Council Minutes Public Facilities Corporation July 27, 2010 — 4:00 p.m. 1. ROLL CALL - 4:08 p.m Present: Council Member Selich, Mayor Pro Tem Henn, Mayor Curry, Council Member Webb, Council Member Gardner, Council Member Daigle Excused: Council Member Rosansky 2. ELECTION OF OFFICERS Motion by Council Member Webb, seconded by Council Member Gardner to elect the Mayor as Chairperson of the Corporation, the Mayor Pro Tem as the Vice - Chairperson of the Corporation, the Council Members as the Corporation's Board of Directors, the City Manager as the Corporation's Secretary, and the Administrative Services Director as the Corporation's Treasurer for the 2010.2011 fiscal year. The motion carried by the following roll call vote: Ayes: Council Member Selich, Mayor Pro Tem Henn, Mayor Curry, Council Member Webb, Council Member Gardner, Council Member Daigle Absent: Council Member Rosansky 3. APPROVAL OF MINUTES FROM THE MEETING OF JULY 14.2009 Motion by Council Member Webb, seconded by Council Member Gardner to waive reading of the subject minutes, approve as written and order filed. The motion carried by the following roll call vote: Ayes: Council Member Selich, Mayor Pro Tem Henn, Mayor Curry, Council Member Webb, Council Member Gardner, Council Member Daigle Absent: Council Member Rosansky 4. NEWPORT BEACH PUBLIC FACILITIES CORPORATION FINANCIAL REPORT Administrative Services Director McCraner provided the staff report and discussed the Library COP, annual debt service, and outstanding principal balance. She noted that the outstanding principal balance will be used as a refunding for the Civic Center bond issue in November. Motion by Council Member Webb, seconded by Council Member Gardner to receive and file the Financial Report. The motion carried by the following roll call vote: Ayes: Council Member Selich, Mayor Pro Tem Henn, Mayor Curry, Council Member Webb, Council Member Gardner, Council Member Daigle Absent: Council Member Rosansky City of Newport Beach Public Facilities Corporation Minutes July 27, 2014 5. PUBLIC COMMENTS - None 6. ADJOURNMENT -4:07 p.m. The agenda for the Newport Beach Public Facilities Corporation was posted on July 21, 2010, at 4:55 p.m. on the City Hall Bulletin Board located outside of the City ' of Newport Beach Administration Building. Recording Secretary Mayor City Clerk City of Newport Beach City Council Minutes November 9, 2010 the financing overview which is not to exceed $128 million, reported on the Certificates of Participation (COP), and discussed which City facilities will be included in the "leased premises" list. She reported that the financing structure contemplates using both Tax - Exempt Series A (COPs) and Taxable Series B [taxable COPS sponsored by the federal Build America Bonds (BABs) program]. She reviewing the financing estimates and reported on what will be included in the Preliminary Official Statement (POS). She emphasized that financing the project in this manner will save the City millions of dollars over the life of the COPs. She discussed the City's opportunity to use BAB money and highlighted the Facilities Replacement Plan. She reported that ee independent rating agencies gave the City the highest bond rating and COP ratin�svailable, and noted that Civic Center project financing can be viewed at www.ne rtbeachea.gov/bonds, City Manager Kiff provided an outline of the project m' stones and a summary, and highlighted the recommendations outlined in the staff o Facilities Financ .Ian reported that bond counsel agreed that this would be an appropriate use. , thanked anccongratulfited the financing team, staff, Building Committee, and Committee, nd emphasized the amount of money the City will be saving by this mapper. The motion 6ftiedk the following roll call vote: Ayes: Council _ " ber Selich, Council Member Rosansky, Mayor Pro Tem Henn, Mayor Curry, Council Member Webb, Council Member Gardner, Council Member Daigle Mayor Curry recessed the City Council meeting at 9:28 p.m. to hold the special meeting of the Newport Beach Public Facilities Corporation. SPECIAL MEETING OF THE NEWPORT BEACH PUBLIC FACILITIES CORPORATION PFC -1. ROLL CALL Present: Council Member Selich; Council Member Rosansky; Mayor Pro Tem Henn; Mayor Curry; Council Member Webb; Council Member Gardner; Council Volume 59 - Page 631 City of Newport Beach City Council Minutes November 9, 2010 Member Daigle PFC -2. NEWPORT BEACH PUBLIC FACILITIES CORPORATION : REFINANCE 1995 CENTRAL LIBRARY COPS AND FINANCE CIVIC CENTER PROJECT. [401100- 20101 Motion by Council Member Webb, seconded by Mayor Pro Tem Henn to adopt Resolution No. PFC- 2010 -1 authorizing the Board of Directors of the Newport Beach Public Facilities Corporation to enter into a Lease Purchase Agreement and certain other documents with the City of Newport Beach (City), in connect' with the execution and delivery of the 2010 Certificates of Participation in order t 0 efmance the 1995 Central Library COPs and to finance the Civic Center project. Motion bv Coundil MemBbr Webb seconded by Council Member Gardner to a) rove a Professi al Se s Agreement with Bohhn Cywinski Jackson, of San cisco, California, or the ar, 'tectural design services including Construction Support at a t to exceed pr' of $3,935,112, and authorize the Mayor and City Clerk to execute the A ment; an b) approve Budget Amendment No. 11BA -016 appropriating $3,935,11 om th ajor Facilities Master Plan Fund to Newport Beach Civic Center Project Acco No 410. 01002009. The motion ca d by the following roil call vote: Ayes: Council: Member Selich, Council Member Rosansky, Mayor Pro Tem Henn, Mayor Curry, Council Member Webb, Council Member Gardner, Council Member Daigle XIX. MOTION FOR RECONSIDERATION - None XX, ADJOURNMENT -Adjourned at 9:35 p.m. in memory of Diane Coltrane The agenda for the Regular Meeting was posted on November 3, 2010, at 2:00 p.m. on the City Hall Bulletin Board located outside of the City of Newport Beach Administration Building. The supplemental agenda for the Regular Meeting and the agenda for the Volume 59 - Page 632 NEWPORT BEACH PUBLIC FACILITIES CORPORATION Statement of Revenues, Expenditures and Changes in Fund Balances For the Year ended June 30, 2011 Expenditures: Current: General government - Public safety - Public works - Community development - Community services - Capital outlay - Debt service: Principal 3,990,000 Interest and fiscal charges 791,290 Service fees - Total expenditures 4,781,290 Excess (deficiency) of revenues over expenditures 2,880,470 Other financing sources (uses): Debt Issuance 3,525,858 Transfers in - Transfers out - Totai other financing sources (uses) 3,525,858 Net change in fund balance Fund balance, beginning Fund balance, ending 6,406,328 565,655 $ 6,971,983 COP Debt Service Revenues: Lease revenues $ 6,164,567 Investment income 11,287 Intergovernmental 1,485,906 Total revenues 7,661,760 Expenditures: Current: General government - Public safety - Public works - Community development - Community services - Capital outlay - Debt service: Principal 3,990,000 Interest and fiscal charges 791,290 Service fees - Total expenditures 4,781,290 Excess (deficiency) of revenues over expenditures 2,880,470 Other financing sources (uses): Debt Issuance 3,525,858 Transfers in - Transfers out - Totai other financing sources (uses) 3,525,858 Net change in fund balance Fund balance, beginning Fund balance, ending 6,406,328 565,655 $ 6,971,983 NEWPORT BEACH PUBLIC FACILITIES CORPORATION Balance Sheet June 30, 2011 COP Debt Service Assets Cash and investments $ Cash with fiscal agent 6,971,983 Due from other funds - Other Total Assets $ 6,971,983 Liabilities and Fund Balances Liabilities: Accounts payable Due to other funds Total Liabilities Fund balances: Nonspendable Restricted for: Debt Service Committed Assigned Unassigned Total fund balance Total liabilities and fund balance 6,971,983 6,971,983 $ 6,971,983 F 1nE o �. i. ,pgFA A�if� JOHN CHIANG California state (f nntrvller July 13, 2011 The Honorable Michael F. Henn Mayor of the City of Newport Beach 3300 Newport Boulevard Newport Beach, CA 92663 Dear Mayor Henn: The State Controller's Office audited the City of Newport Beach's Special Gas Tax Street Improvement Fund for the period of July 1, 2009, through June 30, 2010. We also audited the Traffic Congestion Relief Fund for the period of July 1, 2003, through June 30, 2010. Our audit disclosed that the city accounted for and expended its Special Gas Tax Street Improvement Fund and Traffic Congestion Relief Fund in compliance with requirements, and that no adjustment to the funds is required. If you have any questions, please contact Steven Mar, Chief, Local Government Audits Bureau, at (91.6) 324 -7226. JEFFREY V. BROWNFIELD Chief, Division of Audits JVB /vb cc: Tracy McCraner Administrative Services Director City of Newport Beach City of Newport Beach Special Gas Pax Street Improvement Fund and Traffic Congestion Relief Fund Audit Report Summary......... ... ..... __ ... ........ ... _ ... ... ...... _ ... . ........ .............. ....... __ ............. __ ........ i Background......... .... __ .... ... ................................................................ ............................... 1 Objective, Scope, and Methodology .................................................. ............................... 1 Conclusion........................................................................................... ............................... 2 Follow -Up on Prior Audit Findings .................................................. ............................... 2 Views of Responsible Official..,... ................................ ....... - ...................... ...... ......... 2 RestrictedUse ..................................................................................... ............................... 3 Schedule 1— Reconciliation of Fund Balance ....................................... ............................... 4 City of Newport Beach Special Gas Taro Street Improvement Fund and Traffic Congestion Relief Fund Summary The State Controller's Office audited the City of Newport Beach's Special Gas Tax Street Improvement Fund for the period of July 1, 2009, through June 30, 2010. We also audited the Traffic Congestion Relief Fund for the period of July 1, 2003, through June 30, 2010. Our audit disclosed that the city accounted for and expended its Special Gas Tax Street Improvement Fund and Traffic Congestion Relief Fund in compliance with requirements, and that no adjustment to the funds is required. Background The State apportions funds monthly from the highway users tax account in the transportation tax fund to cities and counties for the construction, maintenance, and operation of local streets and roads. The highway users taxes derive from state taxes on the sale of motor vehicle fuels. In accordance with Article XIX of the California Constitution and Streets and Highways Code section 2101, a city must deposit all apportionments of highway users taxes in its Special Gas Tax Street Improvement Fund. A city must expend gas tax fiords only for street - related purposes. We conducted our audit of the city's Special Gas Tax Street Improvement Fund under the authority of Government Code section 12410. Government Code section 14556.5 created a Traffic Congestion Relief Fund (TCRF) in the State Treasury for allocating funds quarterly to cities and counties for street or road maintenance, reconstruction, and storm damage repair. Cities must deposit funds received into the city account designated for the receipt of state funds allocated for transportation purposes. The city recorded its TCRF allocations in the Traffic Congestion Relief Fund. We conducted our audit of the city's TCRF allocations under the authority of Revenue and Taxation Code section 7104. Objective, Scope, Our audit objective was to determine whether the city accounted for and and Methodology expended the Special Gas Tax Street Improvement Fund and the Traffic Congestion Relief Fund in compliance with Article XIX of the California Constitution and the Streets and Highways Code. To meet the audit objective, we determined whether the city: • Properly deposited highway users tax apportionments and other appropriate revenues in the Special Gas Tax Street Improvement Fund; • Properly deposited TCRF allocations into an account designated for the receipt of state funds allocated for transportation purposes; City of Newport Beach Special Gas Tax Street Improvement Fund and Traffic Congestion Relief Fund Expended funds exclusively for authorized street- related purposes; and • Made available unexpended funds for future expenditures. We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. We did not audit the city's financial statements. We limited our audit scope to planning and performing the audit procedures necessary to obtain reasonable assurance that the city accounted for and expended the Special Gas Tax Street Improvement Fund and the Traffic Congestion Relief Fund in accordance with the requirements of the Streets and Highways Code and Revenue and Taxation Code section 7104. Accordingly, we examined transactions, on a test basis, to determine whether the city expended funds for street purposes. We considered the city's internal controls only to the extent necessary to plan the audit. Conclusion Our audit disclosed that the City of Newport Beach accounted for and expended its Special Gas Tax Street Improvement Fund in compliance with Article XIX of the California Constitution and the Streets and Highways Code for the period of July 1, 2009, through June 30, 2010. Our audit also disclosed that the city accounted for and expended its Traffic Congestion Relief Fund in compliance with Article XIX of the California Constitution, the Streets and Highways Code, and Revenue and Taxation Code section 7104 for the period of July 1, 2003, through June 30, 2010. Follow -Up on Prior Our prior audit report, issued on June 24, 2004, disclosed no findings. Audit Findings Views of We discussed the audit results with city representatives during an exit Responsible conference on April 25, 2011. Ruksbana Virany, Accounting Manager, agreed with the audit results. Ms. Virany further agreed that a draft audit Official report was not necessary and that the audit report could be issued as final. N City ojNe port Beach Special Gas Tax Sheet Improvement Fund and Traffic Congestion Re1lefFund Restricted Use This report is intended for the information and use of the City of Newport Beach's management and the SCO; it is not intended to be and should not be used by anyone other than these specified parties. This restriction is not intended to limit distribution of this report, which is a matter of public record. , -. // V. BROWNFIELD Chief, Division of Audits July 13, 2611 -3- City of Newport Beach Special Gas Tax Street Improvement Fund and Traffic Congestion Relief Fund Schedule 1— Reconciliation of Fund Balance July 1, 2009, through June 30, 2010 Beginning fund balance per city Revenues Total funds available Expenditures Ending fund balance per city Timing adjustment: Accrual of June 2010 highway users tax apportionment (Governmental Accounting Standards Board Statement No. 34) SCO adjustment Ending fund balance per audit Special Gas Tax Street Traffic Improvement Congestion Fund t Relief Fund 2 $ 2,764,553 $ 393,471 1,452,318 784,518 4,216,871 1,177,989 (631,280} ___(638,8 3,585,591 539,149 129,61.6 — $ 3,715,207 $ 539,149 The city receives apportionments from the state highway users tax account, pursuant to Streets and Highways Code sections 2105, 2106, 2107, and 2107.5. The basis of the apportionments for sections 2105, 2106, and 2107 varies, but the money may be used for any street purpose. Streets and Highways Code section 2107.5 restricts apportionments to administration and engineering expenditures, except for cities with populations of fewer than 10,000 inhabitants. Those cities may use the funds for rights -of -way and for the construction of street systems. z Government Code section 14556.5 created a Traffic Congestion Relief Fund (TCRF) in the State Treasury for allocating funds quarterly to cities and counties for street and mad maintenance, reconstruction, and storm damage repair. The TCRF allocations were recorded in the Traffic Congestion Relief Fund. The audit period was July 1, 2003, through June 30, 2010. 'ISM