In July 2008, the Agency issued the “Redevelopment Agency of the City of Sparks, Nevada, Tax Increment Revenue Bonds (Redevelopment Area No. 2), Series 2008” (the “2008 Bonds”) in the amount of $12,700,000 to finance a portion of the Legends at Sparks Marina Project. The outstanding principal amount is currently $9,925,000, and currently interest rates range from 6.4% to 6.7%.  The proposed bonds are expected to have an interest rate of 2.33% for the remaining life of the bonds.

Preliminary estimates indicate that the proposed refunding bonds will enable the Agency to realize a net present value savings of approximately $1.6 million over the remaining life of the bonds.  Final numbers, which were not available at the publication date of this staff report, will be provided at today's meeting, but the final numbers aren't expected to vary significantly from these estimates.  This refunding is expected to decrease the interest rate from 6.4% - 6.7% to 2.33% for the remaining life of the debt.  By approving the attached Bond Resolution, the Agency Board also authorizes the execution of the 2016 Bond Indenture, the Escrow Agreement, and the Waiver & Consent Agreement, all of which are attached. 

The Bond Indenture is an agreement between the Redevelopment Agency and U.S. Bank which is acting as the third party Trustee, and details the rules, responsibilities, flow of funds, etc. pertaining to the proposed bond issue.

The Escrow Agreement is also an agreement between the Redevelopment Agency and U.S. Bank as Trustee, and details how the currently refunded debt will be repaid with funds from the proposed new refunding issue.

The Waiver and Consent Agreement is an agreement between the Redevelopment Agency, RED Development, and the City of Sparks, as this proposed refunding bond pertains to the Disposition, Development and Financing Agreement (DDFA) relating to the Legends at the Sparks Marina Project.  The attached Waiver and Consent Agreement is seeking to amend the DDFA only as it pertains to the issuance of the proposed refunding bonds.  All other provisions within the DDFA would remain unchanged.  At the time of writing this staff report, RED Development was reviewing this document, but the expectation is that they are essentially in agreement to it's provisions and will likely sign the document on or before the close of escrow after they complete their internal review.  

The attached documents are presented for approval in substantially final form and will be executed prior to the close of escrow.

The Agency Board could choose not to approve the attached resolution and prevent the issuance of the refunding bonds under consideration.

I move to approve Resolution No.R-SRA131, a Resolution authorizing the issuance of the Redevelopment Agency of the City of Sparks, Nevada, Tax Increment Revenue Refunding Bonds (Redevelopment Area No. 2), Series 2016; and the execution and delivery of documents relating thereto.