Resolution - 2020-08I7-D&TO Ell I18weerMIMIXIIN
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST
COVINA, CALIFORNIA AUTHORIZING THE ISSUANCE AND
DELIVERY OF PENSION OBLIGATION BONDS TO REFUND CERTAIN
OUTSTANDING PENSION FUND OBLIGATIONS OF THE CITY TO THE
CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM;
APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION
AND DELIVERY OF A TRUST AGREEMENT; AUTHORIZING A
VALIDATION ACTION; APPROVING CERTAIN PROFESSIONALS FOR
THE REFUNDING; AND OTHER MATTERS RELATING THERETO
WHEREAS, the City of West Covina, California (the "City") is obligated by the Public
Employees' Retirement Law, commencing with Section 20000 of the Government Code of the
State of California, as amended (the "Retirement Law"), to make payments to the System relating
to pension benefits accruing to the California Public Employees' Retirement System's (the
"System's") members, including the City; and
WHEREAS, the City is obligated specifically to make certain payments to the System in
respect of current and retired public safety employees and miscellaneous employees under the
pension programs of the System that amortize such obligations over a fixed period of time,
including normal costs (collectively, the "Pension Obligation"); and
WHEREAS, the Pension Obligation is evidenced by a contract or contracts with the
System with respect to public safety employees and miscellaneous employees of the City, as
heretofore and hereafter amended from time to time (collectively, the "CalPERS Contract"); and
WHEREAS, the City is authorized pursuant to Articles 10 and 11 (commencing with
Section 53570) of Chapter 3 of Division 2 of Title 5 of the Government Code of the State of
California (the "Act") to issue bonds for the purpose of refunding any evidence of indebtedness of
the City; and
WHEREAS, the City desires to issue one or more series of bonds (the "Pension Obligation
Bonds") for the purpose of refunding obligations under the Ca1PERS Contract and thereby
providing funds to the System in payment of the Pension Obligation; and
WHEREAS, there is on file with the City Council the proposed form of Trust Agreement
(the "Trust Agreement") to be entered into between the City and a trustee to be named therein (the
"Trustee"), relating to the Pension Obligation Bonds, including the forms of Bonds attached
thereto as an exhibit.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF WEST COVINA AS FOLLOWS:
Section 1. The City Council hereby finds and determines that the foregoing recitals are
true and correct.
98877097.5
Section 2. This City Council hereby finds and declares that the issuance of the Pension
Obligation Bonds to refund Pension Obligations of the Safety Plan and the Miscellaneous Plan,
and the other actions contemplated by this Resolution are in the best interests of the City.
Section 3. This City Council hereby authorizes and approves the assignment and
pledge of all the City's rights, title and interest in and to all money and securities for deposit in, or
deposited in, the Bond Fund established pursuant to the Trust Agreement and any investment
earnings thereon, and any collateral security for, and all proceeds of, any of the foregoing, to the
Trustee, in trust for the security of the owners, of one or more series of the Pension Obligation
Bonds, and the issuance, sale and delivery of such Pension Obligation Bonds. The Pension
Obligation Bonds shall be in substantially the form attached to the Trust Agreement, with such
changes therein, deletions therefrom and additions thereto as the City Manager shall approve, such
approval to be conclusively evidenced by the execution and delivery of the Pension Obligation
Bonds. The Pension Obligation Bonds of any series shall be issued as current interest fixed rate
bonds. The aggregate principal amount of the initial series of Pension Obligation Bonds (the "2020
Pension Obligation Bonds") shall not exceed (i) the lesser of $205,000,000 or (ii) the amount of
the Pension Obligation (as confirmed by the System) remaining unpaid on the Safety Plan and the
Miscellaneous Plan (plus a normal cost contribution with respect to such plans), described above
on the date of issuance, plus an additional amount desirable to fund a reserve and to pay costs of
issuance of the Pension Obligation Bonds, original issue discount, and Underwriter's discount with
respect to such Pension Obligation Bonds.
The Underwriter's discount, excluding original issue discount, shall not exceed 0.318% of
the aggregate principal amount of the 2020 Pension Obligation Bonds. The maximum interest rate
on the 2020 Pension Obligation Bonds shall not exceed 5.8% per annum. The 2020 Pension
Obligation Bonds shall mature not later than 30 years following their date of issuance.
Section 4. The Pension Obligation Bonds, including the 2020 Pension Obligation
Bonds, shall constitute an obligation imposed by law, pursuant to the Constitution and the laws of
the State of California, including the Retirement Law. Payment of the principal of and interest on
the Pension Obligation Bonds is not limited to any special source of funds and shall be payable
from any legally available moneys or funds of the City.
Section 5. The proposed form of Trust Agreement, between the City and the Trustee,
on file with the City Cleric, is hereby approved. The Mayor, the City Manager, and the City Clerk
(the "Authorized Representatives") are each hereby authorized and directed, severally, or any such
officer's designee, for and on behalf of the City, to execute and deliver the Trust Agreement,
substantially in the form on file with the City Clerk, with such changes therein, deletions therefrom
and additions thereto (including, but not limited to changes, deletions and additions as may be
required by a municipal bond insurer, if any) as such Authorized Representative shall approve,
such approval to be conclusively evidenced by the execution and delivery of the Trust Agreement.
Section 6. If an Authorized Representative determines that it will be advantageous to
the City to purchase municipal bond insurance or secure other credit or liquidity enhancement with
respect to some or all of the Pension Obligation Bonds, such Authorized Representative or his
designee is hereby authorized to do so upon determining that such purchase is in the best interest
of the City.
Section 7. The Authorized Representatives of the City are, and each of them hereby is,
authorized and directed to do any and all things, including bringing a validation action under
Section 860 et seq. of the California Code of Civil Procedure and to take any and all actions
(including any required publications of summons or other notice) and execute and deliver any and
all documents which they or any of them deem necessary or advisable to consummate the
transactions contemplated by this Resolution and the Trust Agreement and otherwise to carry out,
give effect to and comply with the terms and intent of this Resolution and the Trust Agreement.
A draft of the Complaint for Validation is on file with the City Clerk.
Section 8. The City Council hereby approves the appointment of (a) Norton Rose
Fulbright US LLP to perform Bond Counsel and Disclosure Counsel services, including the
preparation of validation papers; (b) Wolf & Company Inc. and NHA Advisors LLC, to perform
Municipal Advisor services; (c) Hilltop Securities Inc., to serve as Underwriters; and (d) US Bank
to serve as Trustee. The City Manager is hereby authorized and directed to negotiate and execute
professional services agreements with the financing team members.
Section 9. Each Authorized Representative and all other officers of the City are hereby
authorized and directed, for and in the name and on behalf of the City to do any and all things and
take any and all other actions, including the publication of any notices necessary or desirable in
connection with the sale of the Pension Obligation Bonds and execution and delivery of any and
all assignments, certificates, requisitions, agreements, notices, consents, instruments and other
documents, which they, or any of them, deem necessary or advisable to consummate the issuance
and sale of the Pension Obligation Bonds and the consummation of the transactions as described
herein.
Section 10. All actions heretofore taken by any Authorized Representative or any
officer, employee or agent of the City with respect to the issuance, delivery and sale of the Pension
Obligation Bonds or in connection with or related to any of the agreements referred to herein, are
hereby approved, confirmed and ratified.
(THIS SPACE HAS BEEN INTENTIONALLY LEFT BLAND
Section 11. This Resolution shall take effect from and after its date of adoption.
APPROVED AND ADOPTED this 4th day of February 2020.
APPROVED AS TO FORM
-Zi)�:
Thomas P. ITuarte
City Attorney
T u
ayor
ATTEST
Ky Clayto
D puty City Clerk
I, KYLE CLAYTON, Deputy City Clerk, of the City of West Covina, custodian of the original records,
which are public records which I maintain custody and control for the City of West Covina do hereby
certify the foregoing Resolution, being Resolution No. 2020-08 as passed by the City Council of the
City of West Covina, signed by the Mayor of said Council, and attested by the Assistant City Clerk, at
a regular meeting of the City Council held on the 41h of February, 2020, and that the same was passed
by the following vote, to wit:
AYES: Castellanos, Johnson, Lopez-Viado, Wu
NOES: Shewmaker
ABSTAIN: None
ABSENT: None
Ky*�Cilerk
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98877097.5