City of Culver City, California
City Council Agenda Item Report
RECOMMENDATION:
Staff recommends the City Council conduct a public hearing pursuant to State law
requirements and adopt Resolution No. 2006-R___, approving a bond financing
through the California Statewide Communities Development Authority for Park
Century School.
PROCEDURE:
1. Mayor declares the public hearing open.
2. Mayor seeks a motion to receive and file the affidavit and notice of publication
and all reports presented for this matter.
3. Mayor calls on staff for brief report.
4. Mayor calls for public comments.
5. Mayor seeks motion to close the public hearing.
6. City Council discusses the motion and takes appropriate action.
BACKGROUND:
Park Century School has submitted an application to the California Statewide
Communities Development Authority (CSCDA) for conduit financing of tax exempt
bonds in an amount not to exceed ten million dollars ($10,000,000) for the
acquisition, and renovation of a school facility at 3939 Landmark Street in Culver
City. The new facility is to be the new campus for the school. In order for these
Meeting Date: 10/23/06 Item Number: PH-1
AGENDA ITEM: A Public Hearing for Consideration of a Resolution Approving
Tax-Exempt Conduit Financing for Park Century School in an Amount Not to
Exceed Twelve Million Dollars for a Project at 3939 Landmark Street.
Contact Person/Dept.: Kellee Fritzal/CDD Phone Number: (310) 253-5765
Fiscal Impact: Yes [X] No [ ] General Fund: Yes [X] No [ ]
Public Hearing: [X] Action Item: [ ] Attachments: [X]
Public Notification: Legal notice published in the Los Angeles Times 10/09/06 &
10/16/06); Park Century School, Hawkins, Delafield & Wood (bond counsel), California
Statewide Communities Development Authority (CSCDA) via e-mail (10/18/06); Master
Notification List (10/18/06).
Department Approval:
Susan Evans (10/11/06)
City Manager Approval:
Jerry Fulwood (10/18/2006)
City Controller Approval:
Mary V. Noller (10/18/2006)City of Culver City, California
City Council Agenda Item Report
revenue bonds to qualify as tax exempt, the requirements of the federal “Tax Equity
and Fiscal Responsibility Act” (TEFRA) must be followed. TEFRA requires that such
a bond issue be approved by the legislative body of the governmental unit having
jurisdiction over the project location following a public hearing. The hearing is to
provide the public with the opportunity to comment on the benefit to be provided to
the local community and whether it is appropriate for tax-exempt financing to be
provided.
DISCUSSION
On July 13, 2005, the Planning Commission approved Conditional Use Permit (CUP)
CUP P-2005019 to allow a private school to operate at 3939 Landmark Street. A
nearby business appealed one of the conditions of approval and on November 14,
2005, the City Council modified the condition addressing the installation of a left turn
pocket from Washington Boulevard to Landmark Street.
The subject property is zoned for industrial uses and has been used for industrial
businesses. As such, the property has generated property taxes for the City, the
Redevelopment Agency and other taxing entities. Park Century is a non profit entity,
and is eligible to apply for an exemption from property taxes. This would eliminate a
source of revenue to the City and Redevelopment Agency. To mitigate that impact,
Park Century has agreed to pay property taxes that would normally be generated for
the City and Redevelopment Agency had an industrial use continued on the site.
This payment is included as a formal condition of approval of the CUP.
The City Council has previously approved the CSCDA financing for both Turning
Point School and NPR.
As part of their application to CSCDA, Park Century School has prepared a
summary of community benefits that would be generated by the operation of the
school.
FISCAL ANALYSIS:
The requested bond issue is termed “conduit” financing as the bonds are issued
through the CSCDA, and not by the City. The City has no obligation for repayment
of the bonds and they are not considered a City liability of any form. The Council
resolution contains language confirming this.
The City is able to recover its costs for processing the tax-exempt financing and
holding the TEFRA hearing. Park Century paid the City a $2,500 application fee for City of Culver City, California
City Council Agenda Item Report
the application that was submitted, and has agreed to pay an issuance fee equal to
five basis points (0.05%) of the actual bond issue amount. Based on the proposed
financing amount, $10 million, the issuance fee would be $5,000. These fees are
sufficient to cover all staff costs related to this matter.
ATTACHMENTS:
1. Park Century School application to CSCDA
2. Resolution No. 2006-R___, A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CULVER CITY APPROVING A FINANCING TO BE UNDERTAKEN BY
THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY
TO BENEFIT PARK CENTURY SCHOOL.
MOTION:
That the City Council:
Adopt Resolution No. 2006-R__, A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CULVER CITY APPROVING A FINANCING TO BE UNDERTAKEN BY
THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY TO
BENEFIT PARK CENTURY SCHOOL.
MEETING DATE: 10/23/06
AGENDA ITEM: Public Hearing for Consideration of a Resolution
Approving Tax-Exempt Conduit Financing for Park Century School in an
Amount not to Exceed Twelve Million Dollars for a Project at 3939
Landmark Street.
ATTACHMENTS
1. Park Century School application to CSCDA
2. Resolution No. 2006-R;.e
001uNITIEs't
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CALIFORNIA
COMMUNITIES
JOINT POWERS AUTHORITY
Building Communities, Investing in Local Government Since 1988
September 22, 2006
Kellee Fritzal
Economic Development
City of Culver City
9770 Culver Boulevard
Culver City, California 90232
Subject: Park Century School Tax Equity & Fiscal Responsibility Act (TEFRA)
Hearing
Dear Kellee:
Enclosed is a copy of the Park Century School application. Based upon this application we are
requesting the City of Culver City hold the federally required TEFRA hearing. The hearing is
required to issue tax-exempt bonds for the facilities located at 3939 Landmark Street in the City
of Culver City.
California Statewide Communities Development Authority would issue the bonds and the City
would have no liability for the bonds. I have requested Sean Tierney at Hawkins, Delafield &
Wood, Bond Counsel, to confirm the liability issue and provide you with an explanation of the
City's role in the TEFRA process, the required notice, and the resolution to evidence the TEFRA
hearing. This information will arrive under separate cover.
It is my understanding the TEFRA hearing will be held on Monday, October 23, 2006, at 7:00
p.m. Thank you for your assistance. If you have any questions you may contact me at (925) 933-
9229 ext 216.
GA(
Kindest re 1
Ja4les F. Hamil
Program Manager
California Statewide Communities
Development Authority
cc: Sean Tierney, Hawkins, Delafield & Wood;
Founding Co-Sponsors: -
L
LEAGUE
\\.:: Or CAI IFORNIA
CITIES
Califorma Nate Amatiation of Counhes
2033 North Main Street, Suite 700 • Walnut Creek, California 94596
800.635.3993 • 925.933.9229 • Fax 925.933.8457 • info@cacommunities.org • www.cacommunities.orgAPPLICANT INFORMATION
Application Number:
Name of Borrower:
Primary Contact:
Title:
Street Address:
City:
Telephone Number:
Fax Number:
E-mail:
Type of Entity:
Date Organized:
2006080092
Park Century School
Fred Landau
Business Manager
2040 Stoner Avenue Suite:
Los Angeles State: CA Zip Code: 90025
310-478-5065
310-473-9260
flandau@parkcenturyschool.org
3 For-profit Corporation I7 Non-profit Corporation
3 Municipality r Partnership
3 Other (specify): 1968
CALIFORNIA
C OM MUNM ES
1.11 fittlatK H.:mil
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501(c)(3) Nonprofit Bond Application
PROJECT INFORMATION
Type of Project:
Health Care:
Education:
Other:
r Continuing Care
r- Skilled Nursing
F7-
K-12
• Museum/Cultural
r-
Clinic r Hospital
3 Other (specify): J
Colleges/Universities
3 Other (specify): r Assisted Living
Project/Facility Name: New Campus for the School
Street Address:
3939 Landmark Street
City:
Culver City State: CA Zip Code: 90232
County:
Los Angeles
Is Project located in unincorporated part of the County? No
Has the city or county in which the project is located been contacted? If so, please provide name, title, telephone
number and e-mail address of the person contacted:
Contact Name:
Title:
Phone Number: Ext. Fax Number:
E-mail:
Page 1 of 31 milho ‘1.; I II :)X17
r' s:;'; •Z IA,. I I; GOV'
501(c)(3) Nonprofit Bond Application
FINANCING INFORMATION
Principal Amount: $10,000,000
Tax-exempt Amount: $10,000,000
Taxable Amount: $0
Proposed Closing Date: 11/09/2006
Maturity: 30 Years Interest Rate Mode: r Fixed
V Variable
Type of Offering: Fr Public Offering r Private Placement
Denominations: $100,000
Type of Financing: r Acquisition of Existing Facility J7 New Construction
Fr Refunding
Credit Enhancement: r None 17 Letter of Credit
r Bond Insurance r Other (specify): Name of Credit Enhancement Provider or Private Placement Purchaser: Bank of America NA
Expected Rating: r— Unrated
r s & P V Moody's Aa1
r Fitch PRINCIPAL FINANCE TEAM INFORMATION
UNDERWRITER/PLACEMENT AGENT BOND COUNSEL
Contact: Peter Evans Contact: Sean Tierney
Firm: Banc of America Securities Firm: Hawkins Delafield and Wood
Telephone: 415-953-9540 Telephone: 415-486-4201
Fax: 415-953-9336 Fax: 415-397-1513
E-mail: peter.evans@bankofamerica.com E-mail: stiemey@hawkins.com
Page 2 of 3CALIFORNIA
COMMUNITIES
WINr i. III:IX:1N
=1,.;:j!
501(c)(3) Nonprofit Bond Application
ADDITIONAL INFORMATION REQUIRED
Please provide the following information as additional attachments:
Attachment Description of Information
A $5,000 non-refundable* application fee payable to "CSAC Finance Corporation." This fee will be
credited to your issuance costs at closing (see CSCDA Fee Policies).
Detailed Applicant History.
Description of project or each facility to be financed or refinanced.
Comprehensive summary of project public benefits.
Address of each facility to be financed or refinanced.
Evidence of credit enhancement or intent to purchase bonds.
List of outstanding tax-exempt debt.
Financial statements for last complete fiscal year.
Project Costs (Sources and Uses of Proceeds).
Interested Parties List.
*Refundable only if financing not approved.
MAILING ADDRESS
California Communities
2033 N. Main St., Suite 700
Walnut Creek, CA 94596
Page 3 of 3California Communities Conduit Financing Application
Attachment A — Detailed Applicant History
INTRODUCTION
Founded in 1968, Park Century School ("Park Century" or the "School") is a non-profit
independent co-educational day school designed to meet the specific educational needs of bright
children, ages 7-14 years, who have learning disabilities.
The School serves students from communities in the South Bay to the San Fernando Valley and
from Malibu to Hancock Park, including the greater Los Angeles area. The School's location
allows it to make use of the city's many cultural resources, such as museums, theatres, historic
sites and parks.
MISSION STATEMENT
The mission of Park Century School is to meet the educational, emotional and social needs of learning
disabled students of average to superior intellectual potential and their families in an empathetic and
supportive environment emphasizing academic success, maturity and independence.
PROGRAM OF INSTRUCTION
Daily one-to-one tutoring in small, ungraded classrooms is an underlying principle and value in Park
Century's academic program. Each student receives tutoring every day in reading and every other day in
math. Reading and math specialists assign each child daily follow-up work to be completed
independently in the child's classroom. Students are encouraged to develop a positive self image, set
realistic goals and learn skills and strategies necessary to return to a traditional school. In addition, Park
Century believes that parent education and participation within a team approach are essential to each
student's intellectual, emotional, social and moral development.
One-to-One Tutoring
The one-to-one tutoring relationship is among the strongest and most effective means of focusing on the
student's specific needs. Park Century believes that one-to-one tutorial sessions enhance learning by
creating:
• Highly personalized sessions based upon the child's learning style;
Banc of America Securities I IC Page I
s-California Communities Conduit Financing Application
• Measurer of success through incremental achievement;
• Phonological processing and visualizations strategies;
o Multi-method techniques; and
• Safe nurturing environments.
Park Century has found that one-to-one tutoring is particularly beneficial for children with language,
perceptual or attentional difficulties.
Small Group Instruction
Students participate in group lessons daily for 40 to 60 minutes depending upon classroom placement.
The lessons taught are age and grade appropriate and reflect the guidelines of the California Framework
in Social Studies and Science. Small group instruction allows the child to develop social skills and build
lasting friendships with peers.
In the lower school grades, emphasis is placed on learning how to follow an oral presentation, offering
and accepting information presented by peers, working cooperatively in a group, retaining information
and applying what has been learned.
With the goal of graduation and transitioning into high school, students in the upper school are
encouraged to focus on reaching their full potential especially in the areas of self-esteem, interpersonal
relationships and social awareness. Moreover, faculty at the higher grade levels focus on teaching
students vital study skills (a high priority for students in the upper school) including:
• Participation in discussions and oral presentations;
• Interaction with peers to achieve a common goal;
• Note-taking, research and report writing;
• Analytic and organizational techniques; and
• Self-advocacy methods.
Computers & Technology
Park Century's Computer Center is an integral part of the student's daily academic program. A computer,
for the learning disabled child, can be almost like a buddy. It waits patiently and is anything but
intimidating. It is always ready and willing to make changes or corrections without complaint.
Recognizing the importance of computers to learning disabled children, Park Century has placed
computers in every classroom in addition to those in the Computer Center.
Computers make it easier for students with language difficulties to express themselves. Through tools
such as graphic buttons that use symbols for printed words or word prediction programs, the simple act of
expression is much more accessible to students. Other functions such as spell check, dictionaries and
thesauruses assist students with spelling errors and can even read to the dyslexic student.
Park Century has a strong commitment to basic research on the impact of computers on children with
learning disabilities and has been involved with various research studies over the years. Research
Banc of America Securities LLC Page 2California Communities Conduit Financing Application
conducted at the School has helped develop and refine specialized computer technology that dramatically
improves phonological awareness, the temporal processing problem now believed to be the core deficit of
dyslexia.
Speech & Language Therapy
Park Century has a team of licensed speech pathologists who work with students having difficulties in the
area of speech and language. The speech pathologists work in symmetry with the student's classroom
teachers and reading and math specialists, integrating their therapy with the student's academic work.
Like finely tuned instruments, the good of all Park Century educators is to harmonize their specific
objectives with each other so that each child achieves. These objectives include:
• Organizing and sequencing thoughts;
• Recognizing nonverbal clues and inferences and drawing conclusions;
• Listening, taking turns, and having a conversation;
• Using gestures, facial expressions, body language, eye contact; and
• Learning how to string words together.
The Arts
Park Century's commitment to the arts is vigorous because many learning disabled students excel in
creative endeavors. Through dance, music, drama, or the visual arts, students are encouraged and
challenged to express themselves creatively. As a designated California Arts Council School, Park
Century participates in the Music Center Education Division Artists-in-Residency and Teacher
Partnerships Program. Through this partnership, professional artists conduct special classes with the
students and provide unique opportunities to learn about artistic expression in other cultures.
Physical Education
Park Century considers athletics a key part of every child's growth because athletics teach students much
more than just how to play a particular sport. Physical education is an everyday activity for the School's
students. In addition to team sports such as baseball, volleyball and basketball, one-to-one instruction is
provided to children needing extra time to develop specific physical aptitudes and perceptual motor skills.
ENROLLMENT & ADMISSIONS
Park Century maintains a policy of limited enrollment and selective admissions, recognizing that there is
a range of students that the School serves best. The goal of the admissions process at Park Century is to
determine if the child's needs will be served most appropriately by attending the School. The admissions
process starts with a guided tour of the School and then a submission of an application along with various
materials including psychological test results, relevant medical information, educational reports and
records. The School's admissions team reviews these materials and depending upon the decision of that
review, the Admissions Coordinator arranges an initial meeting for the parents with one of the Co-
Directors of the School and the Academic Coordinator.
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rlCalifornia Conzmunities Conduit Financing Application
Attachment B —Description of Project
The School has purchased an approximate 43,950 sq.ft. building in Culver City which will be its new
campus and enable the School to meet enrollment demand for its highly specialized program for learning
disabled students. Construction will begin in September, 2006, and the new facility is expected to be
ready when the School opens in the Fall of 2007. The total project cost is approximately $15.3 million --
including the approximate $4.73 million acquisition price. The School will use approximately $9.7
million of bond proceeds towards the total project cost. The remaining sources of funds include proceeds
from a capital campaign and sale of the School's existing building.
Novus Construction (Chatsworth) is the General Contractor and the architect is Christopher V. Ward.
The School has also received, on a pro-bono basis, the design services of famed architect Frank Gehry.
Banc of America Securities LLE Page 5Park Century School
Community Outreach Program
As part of its expansion plan for its new facility in Culver City, Park Century School intends
to establish a Community Outreach Center. This Center will be housed near the public
entrance to the School on Landmark Street, and will be open to the general public. Through
this Center, the School intends to share its expertise in educating children with learning
disabilities with the Culver City community as well as with the wider Los Angeles
community. The Community Outreach Center has been an essential component of the
School's expansion plan since 1999, when the Board of Trustees adopted a strategic plan for
the School's growth.
As envisioned in the strategic plan and then elaborated in ongoing planning meetings, the
Community Outreach Center plans to provide services to the LD community in Culver City,
such as:
• Information, counseling and referrals for families with special needs children.
• Dyslexia screening.
• Early literacy training.
• After school tutoring.
• Summer school enrollment for children in the community.
• Transition counseling for students moving from special ed schools to "mainstream"
schools.
• Parent education meetings with guest speakers.
• In-service training for educators.
• Services for adults recently diagnosed as learning disabled.
• A multi-media resource library.
Park Century School currently provides some of these services from its present location in
West Los Angeles. During our CUP process in Culver City in 2005, contact was made with
the Special Education Department of the Culver City Unified School District to explore
mutual interest in our community outreach program. Further contact will take place once the
Community Outreach Program is more fully developed.
We anticipate that some of the services offered will be fee-based. Others will be free. We
intend to provide subsidies for lower income families who request fee-based services but
cannot afford the full fees.California Communities Conduit Financing Application
Attachment D — Listing of Existing Facilities/Address of Each Facility to be
Financed or Refinanced
The School's current facility is located at the following address:
2040 Stoner Avenue
Los Angeles, California 90025
The School's new facility will be located at the following address:
3939 Landmark Street
Culver City, California 90232
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0California Communities Conduit Financing Application
Attachment H — Project Costs (Sources & Uses of Proceeds)
Provided below is an estimated Sources and Uses of funds related to the proposed bond
financing:
Sources of Funds
Bond Proceeds $10,000,000
Total Sources $10,000,000
Uses of Funds
Refinancing of Bank Loan $4,000,000
Project Fund 5,650,000
Bank-Related Fees 150,000
Other Costs of Issuance 200,000
Total Uses $10,000,000
Banc of America Securities LLC Page IIRESOLUTION NO. 2006-R
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CULVER CITY, CALIFORNIA, APPROVING A FINANCING
TO BE UNDERTAKEN BY THE CALIFORNIA STATEWIDE
COMMUNITIES DEVELOPMENT AUTHORITY TO
BENEFIT PARK CENTURY SCHOOL.
WHEREAS, Park Century School (the "School") has requested that California
Statewide Communities Development Authority (the "Authority") participate in a financing
for the purpose of financing the construction, renovation, improvement and equipping of
certain educational facilities (the "Facilities") located within the City of Culver City (the
"City"); and
WHEREAS, the Authority will issue its revenue bonds (the "Bonds"), in an
aggregate principal amount not to exceed $12,000,000, in connection with the financing;
and
WHEREAS, the Authority and the School will enter into a loan agreement
(the "Loan") under which the Authority will loan the proceeds of the Bonds to the School to
finance the following: (1) design, construction, acquisition, installation, renovation and
improvement of real property, facilities, equipment and improvements of the School's
educational facilities located on its new campus at 3939 Landmark Street in Culver City,
California (the "Campus"), including but not limited to demolition of certain parts of the
existing structure, earthquake retrofitting, and complete renovation of the existing building
into a school including installation of a second floor, classrooms, offices, meeting rooms
and a gym and stage, as well as paving and striping the parking lot, and landscaping, (2)
miscellaneous construction, renovation, improvements, demolition, capital maintenance,
equipment acquisition and installation thereof and improvements at the Campus, (3)|101010101010101010 10
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28refinancing of an outstanding bank loan originally used to finance acquisition of the site of
the Campus and (4) various costs of issuance, debt service reserve, capitalized interest,
related working capital and credit enhancement fees (collectively, the "Project"); and
WHEREAS, pursuant to Section 147(f) of the Internal Revenue Code of
1986, as amended (the "Code"), the issuance of the Bonds must be approved by the City
because the Facilities are located within the territorial limits of the City; and
WHEREAS, the City Council of the City (the "Council") is the elected
legislative body of the City and is the applicable elected representative required to approve
the issuance of the Bonds under Section 147(f) of the Code; and
WHEREAS, the School and the Authority have requested that the City
approve the issuance of the Bonds in order to satisfy the public approval requirements of
Section 147(f) of the Code and to satisfy the requirements of Section 9 of the Amended
and Restated Joint Exercise of Powers Agreement (the "Agreement"), dated as of June 1,
1988, among certain local agencies, including the City; and
WHEREAS, pursuant to Section 147(f) of the Code, the Council has,
following notice duly given, held a public hearing regarding the issuance of the Bonds to
finance the Project, and now desires to approve the issuance of the Bonds to finance the
Project; and
WHEREAS, the Council understands that its actions in holding this public
hearing and in approving this Resolution do not obligate the City in any manner for
payment of the principal, interest, fees or any other costs associated with the issuance of
the Bonds, and the Council expressly conditions its approval of this Resolution on that
understanding.
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28NOW, THEREFORE, BE IT RESOLVED, by the Council of the City of Culver
City as follows:
1. The Council hereby approves the issuance of Bonds by the Authority
to finance the Project. It is the intent of the Council that this resolution should constitute
approval of the Bonds for purposes of Section 147(f) of the Code and Section 9 of the
Agreement.
2. The officers of the Council are hereby authorized and directed, jointly
and severally, to do any and all things and execute and deliver any and all documents,
certificates and other instruments which they may deem necessary or advisable in order to
consummate the issuance, sale and delivery of the Bonds by the Authority, and to execute
and deliver such certificates and other documents they may deem appropriate and
otherwise to carry out, give effect to and comply with the terms and intent of this
Resolution. Any actions heretofore taken by such officers are hereby ratified and
approved.
3. The Council expressly conditions its approval of this Resolution on its
understanding that the City of Culver City shall have no obligation whatsoever to pay any
principal, interest, fees or any other costs associated with the Authority's issuance of these
revenue bonds for the construction of improvements at Park Century School in the City of
Culver City.
4. The City shall receive from the School payment in the amount of five
(5) basis points of the face value of any Bonds issued pursuant to this conditional approval
within thirty (30) days after issuance of the Bonds. Payments received after that 30-day
period shall incur interest at ten percent (10%) per annum compounded daily from the date
of the bond issuance until fully paid and received by the City, including interest, if any.
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285. This Resolution shall take effect from and after its passage and
approval.
APPROVED and ADOPTED this day of 2006.
GARY SILBIGER, MAYOR
City of Culver City, California
ATTEST: APPROVED AS TO FOR
CHRISTOPHER ARMENTA, City Clerk CLA. SCHWAB, "ity Attorney
A06-00641
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