Agenda

Return

OVERSIGHT BOARD
TO THE CITY OF BREA
AS SUCCESSOR AGENCY
TO THE BREA REDEVELOPMENT AGENCY

MINUTES

April 14, 2017

REGULAR MEETING
9:00 a.m. - Executive Conference Room
Level Three

Present:	Chair Bill Gallardo; Vice Chair Brad Mason; Keri Bullock; Don Parker; Kashu Vyas
Absent:	Kent Forde; Don Schweitzer
Staff Present:	David Crabtree; Kathie DeRobbio; Cindy Russell; Lee Squire; Karen O'Leary

Public Comment - None.

CALL TO ORDER / ROLL CALL
Chair Gallardo called the meeting to order at 9:00 a.m.
Boardmember Forde arrived at 9:03 a.m.
Boardmember Schweitzer arrived at 9:08 a.m.

DISCUSSION / ACTION ITEMS

March 31, 2017 Special Meeting Minutes
City Clerk Specialist O'Leary reported that she used an incorrect resolution number for an item on the March 31, 2017 agenda. The resolution on the agenda was Resolution OB 2017-09, it should be Resolution OB 2017-07.

Motion was Made by Don Parker, Seconded by Vice Chair Brad Mason to Approve the March 31, 2017 Special Meeting Minutes as Amended.

AYES:	Chair Bill Gallardo, Vice Chair Brad Mason, Keri Bullock, Don Parker, Kashu Vyas
Other:	Kent Forde (ABSENT), Don Schweitzer (ABSENT)
Passed

Approval by the Oversight Board Directing the Preparation of Proceedings for the Refunding of the Outstanding 2003 Tax Allocation Bonds and 2011 Tax Allocation Bonds, Series A and Taxable Series B of the Former Brea Redevelopment Agency, Approving Issuance and Sale of the Refunding Bonds, Making Certain Determinations and Providing Other Matters Relating Thereto
Community Development Director Crabtree stated that Items 3, 4 and 5 are interrelated and noted that he would present them together. He also stated that staff is proposing to refinancing some of the City's bonds that could yield savings, The savings would be spread among the taxing entities which would meet the Department of Finance's (DOF) goals. This transaction is related to the City's Owner Participation Agreement (OPA) with the Brea Mall. He also noted that the DOF rejected the previous submittal, but staff has revisited the proposal to try to get the item moved forward.

Administrative Services Director Russell introduced Julie Romey from Keyser Marston; Vince Lazalde, Assistant Vice President of Stifel Public Finance; and Teresa Ho-Urano, an attorney from Richards, Watson, Gershon. She stated that Ms. Ho-Urano would give an overview of items 3, 4 and 5 and how they are interrelated.

Ms. Ho-Urano discussed SB107 which allows the Successor Agency to take an important step towards completing the agency's affairs via the Last and Final ROPS (LFROPS) process and reminded them that in 2018, the Oversight Board will consolidate with the Orange County Oversight Board.

She discussed paying down outstanding obligations and recommended setting a fixed payment to the Brea Mall OPA with a true-up clause. This will allow Brea to present a package to the bond holders and market the bonds. Prior to selling these bonds it is necessary to set a dollar amount that will be used to defease the bonds. If Brea uses bond proceeds to pay down the bonds then it isn't necessary to issue refunding bonds.

Regarding the Gateway Termination Agreement, Ms. Ho-Urano stated that the agreement is a step toward completing the Successor Agency's task of wrapping up affairs.The DOF has encouraged Brea to liquidate the property.

Mr. Lizaldi gave a brief overview of the proposed 2017 Refunding Bonds which are to refund three (3) series of bonds: The Agency's 2003 Tax Allocation Bonds, the 2011 A Tax Allocation Bonds and the 2011 B Tax Allocation bonds. Together these bonds are outstanding in the amount of approximately $47 million. The annual debt service can be significantly reduced.

In response to Boardmember Parker, Ms. Ho-Urano confirmed that the agreement with the Brea Mall OPA aids in the completion of the LFROPS as well as provide the market some certainty regarding the bond payments.

Boardmember Vyas questioned if the Gateway Termination was a planned, negotiated sale as opposed to a competitive sale and wondered if staff has a concern about public perception of this sale.

Boardmember Parker discussed the denial of the City's request by the Department of Finance.

Motion was Made by Don Parker, Seconded by Vice Chair Brad Mason to Adopt Resolution OB 2017-10 Directing Preparation of Proceedings for the Refunding of Outstanding 2003 and 2011 Bonds, Approving Issuance and Sale of Refunding Bonds, Making Certain Determinations and Providing Other Matters Relating Thereto. This Will Result in an Average Annual Increase of Approximately $182,570 in Property Tax Revenues to the City's General Fund. These are Estimated Savings Based on Current Market Conditions and Subject to Change.

AYES:	Chair Bill Gallardo, Vice Chair Brad Mason, Keri Bullock, Kent Forde, Don Parker, Don Schweitzer, Kashu Vyas
Passed

Bond Proceeds Funding Agreement Between the City of Brea and the Successor Agency to the Brea Redevelopment Agency for 2011A Non-Housing Bonds

Motion was Made by Don Parker, Seconded by Vice Chair Brad Mason to Adopt Resolution OB 2017-11 Approving the 2011A Bond Proceeds Funding Agreement.

AYES:	Chair Bill Gallardo, Vice Chair Brad Mason, Keri Bullock, Kent Forde, Don Parker, Don Schweitzer, Kashu Vyas
Passed

Second Amendment to the Brea Mall Owner Participation Agreement OPA.

Motion was Made by Don Parker, Seconded by Vice Chair Brad Mason to Adopt Resolution OB 2017-12 Approving the Second Amendment to the Brea Mall Owner Participation Agreement.

AYES:	Chair Bill Gallardo, Vice Chair Brad Mason, Keri Bullock, Kent Forde, Don Parker, Don Schweitzer, Kashu Vyas
Passed

Consideration of Approval of Execution and Delivery of an Agreement to Terminate Disposition and Development Agreement as to Commercial Center Component (Gateway Center) and Related Payoff Agreement and Taking Certain Related Actions
Community Development Director Crabtree provided a PowerPoint presentation that included a history of the Brea Gateway Center ownership; the owners's proposal; valuation of the Successor Agency's interest; and next steps. The ownership is being advised by PNC Bank and there is a strong desire to clear the title of the property which we understand to be an impediment to improving or rehabilitating the center. He also summarized the information gained in meetings with the property owners and our consultants.

Boardmember Parker reiterated his concerns regarding the long-range plans of the property owners and their reasons for making this agreement.

Boardmember Vyas thanked Community Development Director Crabtree for the information he gathered and presented.

Motion was Made by Don Schweitzer, Seconded by Don Parker to Adopt Resolution SA 2017-08 to Approve an Agreement to Terminate Disposition and Development Agreement as to Commercial Center Component and Related Payoff Agreement and Taking Certain Related Actions. This Payoff will Result in a One-Time Receipt of Approximately $8,000,000 (Eight Million) to the Successor Agency, Which Will Then Be Transmitted to the County Auditor-Controller for Disbursement to the Taxing Entities. The Transaction Would Also Extinguish the Successor Agency’s Obligation to Make Future CFD-Related Payments (Estimated to be $135,000) under the DDA.

AYES:	Chair Bill Gallardo, Vice Chair Brad Mason, Keri Bullock, Kent Forde, Don Parker, Don Schweitzer, Kashu Vyas
Passed

MEMBER REPORTS / ANNOUNCEMENTS

STAFF UPDATES
Community Development Director Crabtree updated the Board on the status of the sale of the Successor Agency owned property at 323 N. Brea Blvd. The buyers pulled out of the agreement citing personal reasons.

ADJOURNMENT
Chair Gallardo adjourned the meeting at 9:36 a.m.

Respectfully submitted,	The foregoing minutes are hereby approved this 13^th day of July, 2017

______________________________ Lillian Harris-Neal, City Clerk	______________________________ Bill Gallardo, Chair