|
Com.
No.
BSD6 |
Division
Operations—Business Services |
Date
August 20,
2003 |
Subject: ADOPT RESOLUTION
Adopt the following resolution (Attachment No. 1) for
Assignment of Delinquent Tax Receivables to the California Statewide Delinquent
Tax Finance Authority for fiscal years ending June 30, 2003 and June 30, 2004
and Authorizing Execution and Delivery of Related Documents and Actions.
Background:
Under this proposal, which is called the Plymouth proposal, the school
agencies in Los Angeles County – including the community college districts –
have received an upfront premium of 8% of their property tax delinquencies
assigned to the JPA, with this amount not offsetting state aid. Thus, the district has received a guaranteed
risk-free premium, and Plymouth has assumed all of the risks from the financing
and collection process.
Under the current financing of revenue limits, the
penalties and interest on delinquent taxes are part of the funding of revenue
limits for the school agencies in Los Angeles County. By forming a JPA and utilizing the Plymouth proposal, school
agencies can receive, instead, their entire revenue limit funding plus an
additional amount equal to 8% of their property tax delinquencies. In the initial year of this program,
Plymouth agreed to also purchase property tax delinquencies from the prior
three years. They did, in fact,
purchase a total of four years of delinquencies, thereby making the 8% premium
for 2002-2003 significantly higher.
Attachment No. 1
Resolution No. BSD6
RESOLUTION OF THE BOARD
OF TRUSTEES OF THE LOS ANGELES COMMUNITY
COLLEGE DISTRICT APPROVING ASSIGNMENT OF DELINQUENT TAX RECEIVABLES TO THE
California Statewide Delinquent Tax Finance Authority for the fiscal years
ending June 30 2003 and 2004, AND AUTHORIZING EXECUTION AND DELIVERY OF
RELATED DOCUMENTS AND ACTIONS
WHEREAS, under Section 6516.6 of the Government Code of
the State of California (the “Law”), a school district is authorized to sell
and assign to a joint powers authority any or all of its right, title, and
interest in and to the enforcement and collection of delinquent and uncollected
property taxes, assessments, and other receivables that have been levied by or
on behalf of the school district for collection on the secured, unsecured, or
supplemental property tax rolls in accordance with such terms and conditions as
are set forth in an agreement with the joint powers authority; and
WHEREAS, the California Statewide Delinquent Tax Finance
Authority (the “Authority”) has been formed as a joint powers authority for the purpose of purchasing delinquent ad valorem property taxes in accordance with the Law
upon terms and conditions which are acceptable to school districts; and
WHEREAS, under the Law the amount of property tax receipts
to be reported in a fiscal year for a school district for revenue limit
purposes is equal to 100% of the school district’s allocable share of the taxes
distributed to it for the fiscal year, and any additional amounts will not be
reported and will be provided directly to the school district; and
WHEREAS, the District has previously sold to the Authority
its allocable share of delinquent ad valorem property taxes levied by the
County of Los Angeles (the “Tax Receivables”) for the fiscal years ending June
30 in each of the years 1999 through 2002; and
WHEREAS, the Authority has requested the District to sell
its Tax Receivables to the Authority for the fiscal years ending June 30 in
each of the years 2003 and 2004 on terms and conditions substantially identical
to the terms and conditions contained in the Purchase and Sale Agreement (the
“Prior Agreement”) relating to the original purchase of the Tax Receivables by
the Authority from the District for the fiscal years ending June 30 in each of
the years 1999 through 2002; and
WHEREAS, the Authority has made arrangements to issue and
sell a certificate of participation representing a participation interest in
all of the Tax Receivables received from the District and from other
participating school districts in the County of Los Angeles, which certificate
of participation will be sold to a designee of Plymouth Financial Company,
Inc., a Delaware corporation (“Plymouth”); and
WHEREAS, the Authority has presented the District with a
commitment letter among the District, the Authority and Plymouth, and the
governing board of the District wishes to take its action at this time to
authorize the execution and delivery of such commitment letter and all
documents and actions relating to the sale of the Tax Receivables to the
Authority for the fiscal years ending June 30 in each of the years 2003 and
2004, upon the terms and conditions substantially identical to the terms and
conditions set forth in the Prior Agreement;
NOW, THEREFORE, BE IT
RESOLVED by the Board of Trustees of the
LOS ANGELES COMMUNITY COLLEGE DISTRICT as follows:
Section 1.
Approval of Financing Plan; Sale of Tax Receivables to Authority. The Board
hereby approves the financing plan presented to the Board at the meeting at
which this Resolution is adopted, and as generally described in the recitals of
this Resolution. Pursuant to the
financing plan, the Board hereby approves and authorizes the sale of the Tax
Receivables to Authority for the fiscal years ending June 30 in each of the
years 2003 and 2004 on terms and conditions substantially identical to the
terms and conditions contained in the Prior Agreement. The CONTROLLER of the District is hereby
authorized and directed to approve the final form of a Purchase and Sale
Agreement between the District and the Authority, containing terms and
conditions substantially identical to the terms and conditions set forth in the
Prior Agreement. The CONTROLLER of the
District is further hereby authorized and directed to execute the final form of
said Purchase and Sale Agreement in the name and on behalf of the
District. The Board hereby authorizes the
delivery and performance of the executed Purchase and Sale Agreement.
Section 2. Official Actions. The
CHANCELLOR, the CONTROLLER and any and all other officers of the District are
hereby authorized and directed, for and in the name and on behalf of the
District, to do any and all things and take any and all actions, including
execution and delivery of any and all assignments, certificates, requisitions,
agreements, notices, consents, instruments of conveyance, warrants and other
documents, which they, or any of them, may deem necessary or advisable in order
to consummate the sale of the Tax Receivables to the Authority for the fiscal
years ending June 30 in each of the years 2003 and 2004. Whenever in this resolution any officer of
the District is authorized to execute or countersign any document or take any
action, such execution, countersigning or action may be taken on behalf of such
officer by any person designated by such officer to act on his or her behalf if
such officer is absent or unavailable.
Section 3. Effective Date. This
resolution shall take effect from and after the date of approval and adoption
thereof.
PASSED AND ADOPTED this 20th day of August, 2003,
by the following vote:
AYES: _________
NOES: _________
ABSENT:
_______
President of the Board
of Trustees
ATTEST:
Secretary
of the Board of Trustees
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