OCII approves refunding and new-money Mission Bay bonds totaling up to $135 million

The Commission on Community Investment and Infrastructure, meeting March 1, 2016, voted to confirm a package of refunding and new-money tax-allocation bonds to support infrastructure work in Mission Bay.

Acting earlier as the successor agency's financing authority, commissioners approved financing-authority resolutions authorizing documents for four financings: refunding series in Mission Bay North and South and two new-money issuances to reimburse recently completed infrastructure. Deputy Director Grama Hoarder told the board the two refundings are intended to reduce debt service and free tax increment for other uses and that the two new-money series would provide proceeds for reimbursable infrastructure costs already expended or expected to be expended in the next 1–18 months.

Hoarder said the financing package includes a parity negotiated sale for Mission Bay North (2016B) expected to yield about $45 million and a subordinate private-placement sale for Mission Bay South (2016D) with proceeds of up to $90 million, bringing projected new-money proceeds to $135 million against roughly $131 million of reimbursable infrastructure expenditures. She said the two refundings together are expected to reduce debt service by about $13.5 million. The deputy director also described that the subordinate bonds would be paid only after existing senior parity debt, reflecting the credit for property tax increment not yet on the rolls.

Staff and outside advisers — identified in the meeting as PFM (financial adviser), Jones Hall (bond counsel) and Curls Bartling (disclosure counsel) — were available to answer technical questions. Hoarder reviewed CEQA findings, saying the approvals are exempt as financing actions, government fiscal activity and administrative activity and that the related construction already has separate CEQA authorization.

The financing authority moved, seconded and approved the financing-authority resolutions by roll call (vote recorded as three ayes, two absent). The Commission then reconvened, took public comment and confirmed the authorization as commission resolutions 10, 11 and 12 (2016) by the same recorded vote.

Public commenters used the meeting to raise neighborhood and historical-preservation concerns and to urge that development benefits be directed to longtime residents. Commissioners asked follow-up questions about the timing of enrollment of parcels on the tax rolls, the planned use of bond proceeds to reimburse infrastructure that is already permitted and completed, and the mechanics and limits of the subordinate issuance. Staff said they would return to the Commission if additional properties come on the roll and more authority to issue bonds were needed.

The commission recorded the approvals and adjourned; the financing authority portion of the meeting recessed at 1:12 p.m. and adjourned at 1:39 p.m.