Title
Summary Title: Dissolution of Alameda Public Improvement Corporation
Adoption of Resolution Acknowledging that the Alameda Public Improvement Corporation Has Completed Its Purpose, Has No Outstanding Debt, Assets or Liabilities, and that the Board of Directors of the Corporation Determines to Dissolve the Corporation. (Finance 2410)
Body
To: Honorable President and Members of the Board of Directors
From: David L. Rudat, Interim Executive Director
EXECUTIVE SUMMARY
The Alameda Public Improvement Corporation, established in 1988, was used as a means to issue several lease financings all of which have been either repaid or terminated. The Corporation is no longer needed for future City financings and, effectively, has completed its purpose. To avoid any future administrative costs or obligations in respect of the Corporation, staff recommends the Board authorize the dissolution of the Corporation and authorize the filing of documents necessary to effectuate the dissolution.
BACKGROUND
The City established the Alameda Public Improvement Corporation (the “Corporation”) on February 1, 1988, to assist with various lease financings undertaken by the City. On August 7, 1990, the Corporation, originally formed as the Alameda Sewer Improvement Financing Corporation, changed its name to the Alameda Public Improvement Corporation. Since its formation, the Corporation has been involved in several City of Alameda lease financings, including the financing of a sewer project in 1988, the financing of a police facility and related equipment in 1990, the financing of street improvements in 1994, the financing of a library and golf course in 1996, and the financing of City Hall improvements in 1995 and refinancing of that 1995 financing in 2002.
At the time of each financing, the Corporation assigned all of its interests in certain lease obligations then incurred by the City to an independent trustee, and certificates of participation in the City’s lease payments were sold to provide funds for the respective project being financed. The Corporation never retained any assets or had any assets of its own.
The City and the then Community Improvement Commission of the City of Alameda subsequently formed the Alameda Public Financing Authority (the “Authority”), and the Authority effectively replaced the Corporation in connection with City lease financings accomplished in 2008 and the years since then. City Staff and consultants determined that it was more efficient to use the Authority for City lease financings, in lieu of the Corporation, because there were no annual filings needed for the administration of the Authority, a public entity, whereas in order to maintain the tax-exempt status of the Corporation, a nonprofit corporation (and hence its utility in assisting with City lease financings) annual filings were required. The last financing in which the Corporation was involved was the delivery of certificates of participation in 2002 (the “2002 Certificates”). In 2013, the then outstanding 2002 Certificates were repaid in full with proceeds of a refinancing transaction involving the City and a successor to the Authority. Upon payment in full of the 2002 Certificates, the last outstanding agreements to which the Corporation was a party were terminated, the Corporation was no longer needed for future City financings, and the Corporation had completed its purpose.
DISCUSSION
The Corporation has no outstanding debt, asset or liabilities is no longer needed for future City financings and the Corporation has fulfilled its purpose. In order to avoid any future administrative costs or obligations in respect of the Corporation, it is appropriate to dissolve the Corporation. City Staff have been working with the City’s Bond Counsel, Quint & Thimmig LLP, to complete the actions needed to dissolve the Corporation.
FINANCIAL IMPACT
The only financial impact related to the dissolution of the Corporation is the incurrence of various filing fees payable to the Secretary of State, the Attorney General’s Office and the Franchise Tax Board in connection with forms and materials to be filed with them required under applicable California law to complete the dissolution process. Because the Corporation has no assets, the City will need to advance the funds necessary to pay the fees. The various fees are not expected to exceed $3,000.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action in consistent with the Alameda Municipal Code.
ENVIRONMENTAL REVIEW
This action is not a project under Public Resources Code section 21065 and California Environmental Quality Act (CEQA) Guidelines section 15378.
RECOMMENDATION
Adopt resolution acknowledging that the Alameda Public Improvement Corporation has completed its purpose, has no outstanding debt, assets or liabilities, and that the Board of Directors of the Corporation determines to dissolve the Corporation.
Respectfully submitted,
Elena Adair, Treasurer
Alameda Public Improvement Corporation