HomeMy WebLinkAboutPFC0 - Written CommentsReceived After Agenda
Printed August 25, 2020
Item No. 3
August 25, 2020, NB Public Finance Corp. Agenda Comments
The following comments on Newport Beach Public Finance Corporation agenda items are submitted by:
Jim Mosher ( jimmosher[a@yahoo.com ), 2210 Private Road, Newport Beach 92660 (949-548-6229)
Item B. PUBLIC COMMENTS
I believe the City plans to finance construction of the relocated Lido Village fire station by asking
the Public Finance Corporation to issue Certificates of Participation.
Should the board being doing anything to prepare for that?
Another minor mystery is that although the City website correctly states the NBPFC was
incorporated in 1992, a staff report from the Corporation's July 27, 2010, meeting says it was
formed in 1988 to issue bonds to purchase the City's Cannery Village parking lot.
Item 3. Resolution No. PFC2020-1: Approval of Release of Certain
Assets Securing the City's 2010 Certificates of Participation
This item involves documents previously signed by the Corporation, the City and a Trustee.
Here the decision makers are being asked to sign on behalf of the Corporation.
Although I cannot find it explained in the staff report, the same cast of decision makers will be
considering whether to sign on behalf of the City as part of the very similar Item 6 on the
Council's agenda, which involves the same documents with exception of Exhibit C (the
Assignment Agreement) which seems to be strictly between the Corporation and the Trustee.
I have these comments:
The staff report is devoid of any explanation of why it is in the public's interest to release these
assets, and if it is, why it was not done sooner.
And if the statement that "There is no fiscal impact related to this item" means there was no
cost, that seems unlikely. Surely, Stradling Yocca Carlson & Rauth (for whom I can find no
currently active contract in the City's online database) didn't offer to prepare and process the
paperwork for nothing?
As to the documents the Board is being asked to approve, not surprisingly those prepared by
the City contain typos:
For example, on page NBPFC 3-6 there is a place for the resolution to be signed by
"President of the Board of Directors, Newport Beach Public Facilities Corporation." But the
Board has no President (the Corporation does). So it is either "Chairperson of the Board of
Directors, Newport Beach Public Facilities Corporation" or "President of the Newport Beach
Public Facilities Corporation."
August 25, 2020, NBPFC agenda comments - Jim Mosher Page 2 of 2
But those prepared by Stradling Yocca Carlson & Rauth have errors as well:
For example, Recital A on page NBPFC 3-8 refers to "a "Site Lease, "dated as of November
1, 2020 (the "Site Lease'), and recorded on November 29, 2010." Since it's difficult to believe
the County would accept for recording something dated 10 years in the future, it seems one
year must be wrong. I suspect the first year should be 2010 as well.
I would not be surprised if the documents contain other errors, but I don't know.
It is also unclear to me, and unexplained, why all the documents are backdated to "August 1."
Beyond these considerations, the staff report refers to certain "conditions precedent" that must
be met under Section 7.12 of the 2010 Lease/Purchase Agreement (a copy of which is not
provided, and which contains its own typos, confusingly referring to paragraphs "i" through "iv"
when they are actually labeled "a" through "f') before a release is possible.
While it is possible those conditions have been met, I do not see any disclosure of what they are
or verification that they have.