DATE: September 12, 2023
TO: Mayor and City Council
FROM: Director of Finance
SUBJECT
Lease Obligation Refinancing: Adopt Resolutions of the City Council and the Hayward Public Financing Authority Regarding Amended Savings Requirements Related to the Refinancing of Prior Lease Payment Obligations, Approval of the Preliminary Official Statement and Bond Purchase Contract for Refunding Certificates of Participation
RECOMMENDATION
That the Hayward City Council and the Board of Directors of the Hayward Public Financing Authority (the "City") each adopt a resolution (Attachments II and III) approving amended savings requirements for the proposed refunding of outstanding general fund lease payment obligations and approving the attached preliminary official statement ("POS") and purchase agreement for the 2023 Refunding Certificates of Participation ("2023 Refunding COPs). The POS serves as the offering document to investors and provides details about the terms of the 2023 Refunding COPs, the City's financial condition, how the funds will be used, potential risks, and other relevant information. The POS helps potential investors make informed decisions about investing in the bonds.
SUMMARY
Under current market conditions, the City's municipal advisor (NHA Advisors) and underwriter (BofA Securities, Inc.) estimate net present value savings from a potential refunding of the 2015 Certificates of Participation ("2015 COPs") to be approximately $1.7 million and the aggregate cash flow savings is estimated to be in excess of $10 million. Under current market conditions, it is estimated that a potential refunding of the 2014 Lease Agreement would result in a slight net present value loss. However, staff and NHA Advisors continue to discuss the benefits of refunding the 2014 Lease Agreement and believe it may be in the best interests of the City to refund the 2014 Lease Agreement to unencumber the leased asset even if there are no net present value savings.
ATTACHME...
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