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THE CITY OF <br /> <br />pL£AS&NTON <br /> <br />6U <br /> <br />City Council <br />Staff Report <br /> <br /> June 21, 2005 <br />Finance Department <br /> <br />SUBJECT <br /> <br />RESOLUTION APPROVING THE FORM OF, AND AUTHORIZING <br />THE EXECUTION AND DELIVERY OF, A PURCHASE AND SALE <br />AGREEMENT AND RELATED DOCUMENTS WITH RESPECT TO <br />THE SALE OF THE CITY'S VEHICLE LICENSE FEE RECEIVABLE <br />FROM THE STATE; AND DIRECTING AND AUTHORIZING <br />CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH <br /> <br />STAFF RECOMMENDATION: <br /> <br />Staff recommends that the Council approve: (1) the resolution authorizing <br />the sale of the City's State VLF Receivable to California Statewide <br />Communities Development Authority ("CSCDA") and (2) other related <br />documents necessary to transact the sale. <br /> <br />SUMMARY <br /> <br />The State of California owes California cities $1.2 billion in Vehicle License <br />Fee backfill revenues from 2003-04. The City of Pleasanton's share of this <br />receivable is $1,136,257. As part of this year's budget agreement, the State <br />is supposed to pay these funds to the City by August 2006, and the City has <br />planned on using these funds as part of the new General Fund two-year <br />budget. The CSCDA and the League of California Cities have established a <br />bond program whereby CSCDA will purchase the cities receivable at a price <br />between 90 and 95% of the receivable (the difference will be used to pay <br />bond costs). In order to pay the cities, the CSCDA will sell a combination <br />of taxable and tax-exempt bonds, with the State receivable serving as <br />collateral. In February, in the first of two series of CSCDA bond sales, 56% <br />of the State VLF receivables were sold by 133 cities. Based on the State's <br />recurring budget problems and the possibility of continued delays in <br />payment, staff believes it is prudent to sell the city's receivable in this <br />second July bond sale and realize approximately 92.5% through the CSCDA <br />program. Being able to invest the funds twelve months earlier than <br />anticipated mitigates the reduction in the receivable. The Resolution sets a <br />minimum price of $1,033,901 (91% of the receivable) although staff <br />anticipates the City will receive approximately 92-93% of its receivable. <br /> <br />SR:05:169 <br /> <br /> <br />