(1)AR 061207 Issuance of Revenue Bonds

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Bond Purchase Contract. This is the contract between the Authority and the Underwriter with the approval of the City. The Bond Purchase Contract sets forth the terms under which the 2007 Bonds are to be issued, the price to be paid by the Underwriter and the various conditions and requirements on both parties to affect the closing of the bonds. Continuing Disclosure Agreement . This agreement by and between the Authority and the Trustee as Dissemination Agent provides for the City's continuing disclosure obligations under Rule 15c- 12 of the Securities and Exchange Act of 1934. Escrow Agreement. This agreement, by and among FARECal, the City and The Bank of New York Trust Company, N.A., as escrow agent provides for the defeasance and prepayment of certain FARECal obligations of the City as described herein. FINANCIAL IMPACT: It is estimated that approximately $5,000,000 in new money will be issued for the Project. The remaining amount of the issue is for the refunding of existing FARECal debt. The City's annual debt service will be about $1.6 million annually until 2022, declining to about $500,000. Funds for the Purchase Payments have been budgeted in the following fiscal year in account number 520-8000-8001-2500-0427-000, Principal, and account number 520-8000-8001-2510-0427-000, Interest. The City is expected to realize interest cost savings greater than 3% through the refunding depending upon the bond market on the sale date. The primary consideration of the financing is not interest rate saving but structuring the debt to be about the same after the financing as it is currently and to provide capacity for new debt in the future. It is estimated that the refunding will generate approximately $400,000 in net present value savings ENVIRONMENTAL IMPACT: None RECOMMENDATION: Staff recommends approval of the following, categorized by legal entity: City Council Resolution of the City Council of the City of Colton approving the issuance of not to exceed $17 million aggregate principal amount of Bonds by the Colton Financing Authority, approving an Installment Purchase Agreement, and Indenture of Trust, a Continuing Disclosure Agreement and a Bond Purchase Contract, authorizing the delivery of a Preliminary Official Statement, authorizing the execution and delivery of an Official Statement, approving the appointment of a Trustee and authorizing certain actions in connection therewith. Colton Public Financing Authority Resolution of the Colton Public Financing Authority approving the issuance of not to exceed $17 million aggregate principal amount of Bonds by the Colton Public Financing Authority, approving an Installment Purchase Agreement, an Indenture of Trust, a Continuing Disclosure Agreement and a Bond Purchase Contract, authorizing the delivery of a Preliminary Official Statement, authorizing the execution and