Laserfiche WebLink
restrictive bond covenants. <br /> C. Term of Refunding Issues <br /> The City will refund bonds within the term of the originally issued debt. The City may <br /> also consider shortening the term of the originally issued debt to realize greater <br /> savings. The remaining useful life of the financed facility and the concept of inter- <br /> generational equity should guide this decision. <br /> D. Escrow Structuring <br /> The City shall utilize the least costly permitted securities available in structuring <br /> refunding escrows. The City will examine the viability of an economic versus legal <br /> defeasance on a net present value basis. Generally, the City should look to purchase <br /> State and Local Obligations (SLGS) from the federal treasury when structuring <br /> refunding escrows. The City may review the purchase of Open Market Securities to <br /> fund a refunding escrow. In such a case, a certificate from a third-party agent, who is <br /> not a broker-dealer, is required stating that the securities were procured through an <br /> arms-length, competitive bid process (in the case of open market securities), that such <br /> securities were more cost effective than State and Local Government Obligations <br /> (SLGS), and that the price paid for the securities was reasonable within Federal <br /> guidelines. Under no circumstances shall an underwriter, agent or financial advisor sell <br /> escrow securities to the City from its own account. <br /> E. Arbitrage <br /> The City shall take all necessary steps to optimize refunding escrows and to avoid <br /> negative arbitrage. Any resulting positive arbitrage, on funds other than advance <br /> refunding escrows (which are not allowed to generate positive arbitrage earnings), will <br /> be rebated as necessary according to Federal guidelines. <br /> 11. PERFORMANCE STANDARDS <br /> The City of Pleasanton strives to maintain `investment grade' standings in the <br /> municipal market. Below is an Investment Grade Table of the three (3) major rating <br /> agencies. <br /> Investor's Standard& Fitch Investors <br /> Service Inc. Poor's Service, Inc. Definition <br /> Corporation <br /> Aaa AAA AAA Highest rating assigned. Very strong <br /> security. <br /> Aa AA AA Very strong security. Only slightly <br /> below best rating. <br /> A A A Average security but more subject to <br /> adverse financial and economic <br /> City of Pleasanton Debt Management Policy (February 2022) Page 11 <br />