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Title:
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Adoption of a Resolution of the Culver City Redevelopment Agency Authorizing as to Form and the Execution and Delivery of a Fourth Supplemental Indenture.
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City of Culver City, California
Redevelopment Agency Agenda Item Report
Page 1 of 2
RECOMMENDATION:
Staff recommends the Agency adopt a resolution authorizing as to form and the
execution and delivery of a fourth supplemental indenture to the four series of
bonds under the indenture, dated 1999, 2002, 2004 and 2005.
BACKGROUND:
The 1999 Master Indenture to the aforementioned bonds contemplates that the
Indenture may be amended from time to time for purposes that do not materially
adversely affect the interests of the Owners of the Bonds. The proposed resolution
will amend the Indenture to allow a form of investment for bond proceeds not
contemplated at the time of the Master Indenture.
DISCUSSION:
Due to the upcoming five year anniversary related to the 2002 bonds and
scope/schedule alterations for various projects, it has become necessary to
reallocate unrestricted monies to the bond funds by June 24, 2007. Agency
members approved transactions associated with said allocation.
As a by product of these transactions, the $9 million replaced in the bond fund
must subsequently be invested. Based on discussions held with Agency staff, the
Agency Treasurer has determined that the anticipated drawdown scheduled for
those funds is fluid, and therefore needs to place the funds in a flexible investment
instrument, one that protects the funds but also draws a reasonable return on
Meeting Date: 07/02/07 Item Number: A-3
AGENDA ITEM: Adoption of a Resolution of the Culver City Redevelopment
Agency Authorizing as to Form and the Execution and Delivery of a Fourth
Supplemental Indenture.
Contact Person/Dept.:
Crystal C. Alexander, Agency Treasurer
Phone Number: 310-253-5865
Fiscal Impact: Yes [X] No [] General Fund: Yes [] No [X]
Public Hearing: [] Action Item: [X] Attachments: [X]
Public Notification:
Master notification list; outside counsel at Richards, Watson and Gershon
Department Approval:
Crystal C. Alexander (6/19/07)
Exec. Director Approval:
Jerry Fulwood (6/28/07)
City Controller Approval:
Marlee Chang (6/28/07)
City of Culver City, California
Redevelopment Agency Agenda Item Report
Page 2 of 2
investment. While the current Indenture contains a number of permitted
investments, the Agency Treasurer has identified an additional, secure investment
vehicle not currently on the permitted investment list.
FISCAL ANALYSIS:
The Agency and City are currently authorized and utilize, under the investment
policies for same, to invest funds with the State Treasurer’s Local Agency
Investment Fund (LAIF.) While this is considered a short term investment vehicle,
the returns from LAIF are currently superior to other Indenture permitted
investments (with flexible drawdown features) as shown below:
INVESTMENT VEHICLE INDENTURE
PERMITTED
CURRENT RATE
OF RETURN
LAIF Only if amended 5.25%
Fidelity Investments Money
Market Fund
Yes 5.04%
Bank of America Overnight
Sweep Fund
Yes 4.94%
ATTACHMENTS:
1. Proposed Resolution.
2. Fourth Supplemental Indenture.
MOTION:
That the Agency:
Adopt a resolution authorizing as to form and the execution and delivery of a fourth
supplemental indenture to the four series of bonds under the indenture, dated
1999, 2002, 2004 and 2005.