(24)AR 081908 Fiscal Consultancy Services

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CITY OF COLTON ITEM #26 AGENDA REPORT FOR REDEVELOPMENT AGENCY BOARD MEETING OF AUGUST 19, 2008 TO: HONORABLE CHAIRPERSON AND BOARD MEMBERS FROM: DILU DE ALWIS, FINANCE DIRECTOR CANDACE CASSEL, ECONOMIC DEVELOPMENT DIRECTOR SUBJECT: RIVISION OF THE BOND FINANCING TEAM AND APPROVE A PROFESSIONAL SERVICES CONTRACT WITH HINDERLITER, DE LLAMAS & ASSOCIATES FOR FISCAL CONSULTANCY SERVICES ON THE PROPOSED TAX ALLOCATION BONDS. DATE: AUGUST 11, 2008 DISCUSSION/ ANALYSIS At a workshop with the City Council and the Redevelopment Agency on July 31, 2007, staff presented a RDA bonding opportunity at which time staff was given direction to assemble a bond team. At the August 21, 2007 meeting the Agency Board approved a bond team comprised of CSG Advisors as Financial Advisor (FA), Urban Futures as Fiscal Consultant (FC), and a team of underwriters comprising Piper Jaffray, E.J. De La Rosa & Co. and M.L. Stern and Co. Additionally staff was given authorization to hire Best, Best & Krieger as Bond Counsel and Nosserman, Guthner, Knox and Elliot as Disclosure Counsel. Staff has been working with the above group gathering information in preparation for this complex issue with the intention of having bonds issued in the second quarter of this fiscal year. However given the complexities involved with the Agency's financials and project areas and the current economic climate, CSG Advisors, the Agency's FA has recommended that the Agency utilize Hinderliter, de Llamas & Associates (HDL) as its fiscal consultant for this issuance. HDL currently reports and analyzes the Agency's tax increment and calculates it pass through obligations which makes it the ideal company to serve as the fiscal consultant. UFI has already completed a substantial amount of work for the bond issuance and is being asked to be compensated for its services provided through July 31, 2008, which will be from bond proceeds as will HDL for their services from this point forward. FINANCIAL IMPACT There is no immediate fiscal impact to the Agency as no payments to HDL for their FC work will be made until bonds are sold. ENVIRONMENTAL IMPACT This action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 1506(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the State CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3 because it has no potential in resulting in physical change to the environment, directly or indirectly. CONFLICT OF INTEREST Hinderliter, de Llamas & Associates Contact; Lloyd de Llamas RECOMMENDATION Staff recommends the Agency Board authorize the Executive Director to execute an agreement with HDL for Fiscal Consultant services related to the upcoming tax increment bond issuance for the Agency. TEAM City Attorney: City Manager: Finance Director: OTHER: