TITLE
Recommendation to adopt resolution approving Associate Membership of the City of Long Beach in the California Enterprise Development Authority; and authorize execution of an Associate Membership Agreement. (Citywide)
DISCUSSION
The California Enterprise Development Authority (CEDA) is a joint powers authority whose purpose is to issue tax-exempt and taxable conduit revenue bonds to fund industrial and commercial development projects within member jurisdictions. Federal and State laws provide the ability for cities and counties to join together under cooperative agreements to form joint powers authorities to issue tax-exempt and taxable bonds to fund projects that provide a public benefit and serve the needs of residents within the jurisdictions of the participating members. All cities and counties in California have the ability to act as an issuer of conduit revenue bonds, but many jurisdictions utilize joint powers authorities primarily for economies of scale, to access specialized transaction knowledge and resources, and to avoid using valuable local staff time on these types of transactions.
CEDA is a joint powers authority consisting of the cities of Selma, Lancaster and Eureka. The counties of Sacramento, Riverside, Stanislaus, Sonoma, Yolo and San Bernardino as well as the cities of Pittsburg, Upland, Fairfield, Duarte and Montebello are Associate Members. CEDA's activities are dedicated to providing economic development assistance to member jurisdictions as an extension of the economic development assistance provided by the California Association for Local Economic Development (CALED) to its members. The City of Long Beach is a member of CALED.
The Associate Membership Agreement (Agreement) permits any other local agency in California to join CEDA as an Associate Member. An existing business in the City has requested CEDA's assistance in financing the acquisition and installation of certain manufacturing facilities and to this end has requested that the City of Long Beach become an Associate Member of CEDA. Associate membership in CEDA will assist the City as well as for-profit and nonprofit organizations located within the City in financing industrial and commercial development projects and other public purpose projects within the City. CEDA's Associate Members enjoy nearly all the benefits of regular membership without the related duties or obligations. Associate Members have ample opportunity to provide input on proposed or existing programs. Further, Associate Members are not restricted or inhibited in any way with respect to their independent ability to finance any project in any manner they deem appropriate, which mayor may not involve or include CEDA.
In addition, federal law requires a public hearing before the City Council prior to any bond issuance by CEDA for projects under the City's jurisdiction. If the City Council does not approve the project, CEDA cannot issue bonds.
CEDA does not charge any fees for membership. Any bonds issued by CEDA are special, limited obligations only of CEDA, payable solely through the payment of principal and interest from the borrower (local business). Neither the faith or credit, nor the taxing power of the City, any member of CEDA, the State or any political subdivision is pledged to the repayment of the bonds.
This letter was reviewed by Assistant City Attorney Heather Mahood on November 21, 2007 and Budget Management Officer Victoria Bell on November 20,2007.
TIMING CONSIDERATIONS
City Council action is requested on December 4, 2007 to allow the City to become an associate member of CEDA in a timely manner.
FISCAL IMPACT
There is no fiscal impact associated with this item.
SUGGESTED ACTION
Approve recommendation.
BODY
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LONG BEACH APPROVING THE ASSOCIATE MEMBERSHIP OF THE CITY OF LONG BEACH IN THE CALIFORNIA ENTERPRISE DEVELOPMENT AUTHORITY
Respectfully Submitted,
MICHAEL P. CONWAY
ACTING DIRECTOR OF COMMUNITY DEVELOPMENT
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APPROVED: |
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PATRICK H. WEST |
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CITY MANAGER |