File #: 2019-1103    Version: 1 Name:
Type: Discussion Status: Agenda Ready
File created: 12/2/2019 In control: City Council
On agenda: 1/14/2020 Final action:
Title: APPROVAL OF RESOLUTION NO 20-015 OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA, AUTHORIZING THE ISSUANCE OF BONDS TO REFUND CERTAIN PENSION OBLIGATIONS OF THE CITY OF CARSON, APPROVING THE FORM AND AUTHORIZING THE EXECUTION OF A TRUST AGREEMENT AND BOND PURCHASE AGREEMENT, AUTHORIZING JUDICIAL VALIDATION PROCEEDINGS RELATING TO THE ISSUANCE OF SUCH BONDS AND APPROVING ADDITIONAL ACTIONS RELATED THERETO (CITY COUNCIL)
Attachments: 1. RESOLUTION NO. 20-015 POB, 2. City of Carson Bond Purchase Agreement, 3. City of Carson Pension Bonds Trust Agreement, 4. City of Carson Kosmont Financial Advisor Agreement Pension Bonds, 5. City of Carson Nixon Peabody Disclosure Counsel Contract Pension Bonds, 6. City of Carson Professional Services Contract Harrell Company
Report to Mayor and City Council
Tuesday, January 14, 2020
Discussion


SUBJECT:
Title
APPROVAL OF RESOLUTION NO 20-015 OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA, AUTHORIZING THE ISSUANCE OF BONDS TO REFUND CERTAIN PENSION OBLIGATIONS OF THE CITY OF CARSON, APPROVING THE FORM AND AUTHORIZING THE EXECUTION OF A TRUST AGREEMENT AND BOND PURCHASE AGREEMENT, AUTHORIZING JUDICIAL VALIDATION PROCEEDINGS RELATING TO THE ISSUANCE OF SUCH BONDS AND APPROVING ADDITIONAL ACTIONS RELATED THERETO (CITY COUNCIL)

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I. SUMMARY

At the November 26, 2019 City Council workshop, the City Council directed staff to prepare documents required to begin the process to issue Pension Obligation Bonds to pay the unfunded actuarial liability (UAL) in the City's pension plan with the California Public Employees Retirement System (PERS) for the Miscellaneous employees' plan, with an estimated cost savings up to $45 million over 24 years.

II. RECOMMENDATION
Recommendation

1. Approve the resolution (1) approving the form of a Trust Agreement and a Bond Purchase Agreement, (b) authorizing the issuance of the bonds in an amount not to exceed $115 million, (c) authorizing the filing of a judicial validation action with the Los Angeles County Superior Court and (d) approving execution of related consulting contracts.


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III. ALTERNATIVES

Take another action deemed appropriate by City Council

IV. BACKGROUND

At the November 5, 2019 Council Meeting, the City Council created an Ad Hoc Committee to review cost effective pension liability funding opportunities. A presentation regarding pension liability funding was made at the November 19, 2019 City Council meeting. At that time, the City Council gave direction to conduct a public workshop on Pension Obligation Bonds (POBs). At the workshop, information was presented regarding POB issuance and potential financial benefits to the City from the issuance of POB. Based on the analysis, the cost to fund the existing UAL ...

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