HomeMy WebLinkAboutAgenda Packet - February 23, 2012 - UB i
AZUSA
❑4 Nt A 'BATIFR
AGENDA
REGULAR MEETING OF
AZUSA UTILITY BOARD
AZUSA LIGHT & WATER FEBRUARY 27, 2012
729 N. AZUSA AVENUE 6:30 P.M.
AZUSA, CA 91702
AZUSA UTILITY BOARD
KEITH HANKS
CHAIRPERSON
ANGEL CARRILLO JOSEPH R. ROCHA
VICE CHAIRPERSON BOARD MEMBER
URIEL E. MACIAS ROBERT GONZALES
BOARD MEMBER BOARD MEMBER
6:30 P.M. Convene to Regular Meeting of the Azusa Utility Board
• Call to Order
• Pledge to the Flag
• Roll Call
A. PUBLIC PARTICIPATION
1. (Person/Group shall be allowed to speak without interruption up to five (5) minutes maximum time,
subject to compliance with applicable meeting rules. Questions to the speaker or responses to the
speaker's questions or comments shall be handled after the speaker has completed his/her comments.
Public Participation will be limited to sixty(60) minutes time.)
1 001
B. UTILITIES DIRECTOR COMMENTS
C. UTILITY BOARD MEMBER COMMENTS
D. CONSENT CALENDAR
The Consent Calendar adopting the printed recommended action will be enacted with one vote. If Staff or
Councilmembers wish to address any,item on the Consent Calendar individually, it will be considered under
SPECIAL CALL ITEMS.
1. Minutes.
Recommendation: Approve minutes of regular meeting on January 23, 2012 as written.
Jan 23 Mins.pdf
2. Selection of Bond and Disclosure Counsel to Refund Water and Electric Utility Lone Term Debt.
Recommendation: Approve the selection of Hawkins, Delafield & Wood LLP to serve as bond and
disclosure counsel to refund a portion of the long term debt issued by the water and electric utilities in
2003.
Bond Counsel.pdf Hawkins-Proposal.pd
f
3. Selection of Underwriter to Refund Water and Electric Utility Lone Term Debt. Recommendation:
Approve the selection of De La Rosa & Co. to serve as underwriter to refund a portion of the long term
debt issued by the water and electric utilities in 2003.
Underwriter Rpt.pdf FA Evaluation.pdf De to Rosa
Proposal.pdf
4. Coastline Equipment, Incorporated Blanket Purchase Order Amendment. Recommendation:
Approve the addition of$10,000 to the blanket purchase order of Coastline Equipment, Inc.
BPO for
Coastline.pdf
2 002
5. Notice of Completion for Proiect W-266A, Water Main Replacement in Hilltop Avenue in Azusa,
and San Bernardino Road in West Covina and Los Angeles County and Workman Avenue in West
Covina. Recommendation: Approve the addition of 42 days to the time of completion, accept Project
W-266A, and direct the City Clerk's Office to execute the Notice of Completion and have the same
recorded at the Office of the Los Angeles County Recorder.
NOC Rpt.pdf NOC-W266A.pdf
6. Award of Collection Agency Services Contract with Sequoia Financial Services. Recommendation:
Approve the award of a five year contract to Sequoia Financial Services for collection agency services for
unpaid closed utility bills and property damages.
L
Collection PSA.pdf
Agency.pdf
E. SCHEDULED ITEMS
1. Initiation of AB 2514 Mandated Study of Applicability of Energy Storage System(s) for Azusa
Light & Water. Recommendation: Authorize Azusa Light & Water to initiate a study of the feasibility
and economics of procuring/installing energy storage systems, as required by California Assembly Bill
2514.
�,
Energy Storage
Study.pdf
F. STAFF REPORTS/COMMUNICATIONS
1. Second Quarter Financial Report
rri i=
Qtry Fin Rpt.pdf Elec 2nd Qtr Rpt.pdf Water 2nd Qtr
Rpt.pdf
2. Morgan Meguire LLC Legislative Report
Federal Leg Morgan Meguire
Update.pdf Rpt.pdf
3 003
3. Water Supply Update
�i
Water Supply Exhlbit.pdf
Update.pdf
4. Electric Vehicle/Charging Station Update
EV-Recharging.pdf
5. Automated Trash Collection Workshops (Verbal)
G. ADJOURNMENT
1. Adjournment.
`In compliance with the Americans with Disabilities Act, if you need special assistance to participate in a city
meeting, please contact the City Clerk at 626-812-5229. Notification three (3) working days prior to the
meeting or time when special services are needed will assist staff in assuring that reasonable arrangements
can be made to provide access to the meeting."
`In compliance with Government Code Section 54957.5, agenda materials are available for inspection by
members of the public at the following locations: Azusa City Clerk's Office - 213 E. Foothill Boulevard,
Azusa City Library- 729 N. Dalton Avenue, and Azusa Light& Water-729 N.Azusa Avenue,Azusa CA."
4 004
Utility Board Meeting
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Palo Verde Nuclear
Generating Station
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February 27, 2012
Chair Keith Hanks
AZUSA
LIGHT & WATER
Utilities Director Comments
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AZUSA
LIGHT & W A 1 ( A
Consent Agenda
• January 23, 2012 Minutes
• Selection of Bond & Disclosure Counsel ($63,000)
• Selection of Underwriter for Debt Refund ($63,510)
• Coastline Equipment Blanket P. O. Amendment ($10,000)
• Notice of Completion, Project W-266A
• Award of Collection Agency Contract to Sequoia
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3 AZUSA
LIGHT b WATER
Initiation of AB 2514 Study of
Energy Storage Systems
00
Azusa Utility Board
February 27, 2012
4
AZUSA
L I G H T 6 W A* E R
Background
In 2010, AB 2514, the "Energy Storage Bill", was
signed into law.
° AB 2514 requires all electric utilities in California to
undertake a study of the applicability of energy
storage technologies
If such technologies are cost effective, the utility must
set goals for procuring/installing same
Study must be "initiated" by March 1 , 2012 and
completed by October 1 , 2014 *u
5
A Z U S A
LIG H I & 'NATER
Energy Storage
° Concept is not new to electric industry
° Storage technologies include pumped hydro ,
batteries, flywheels, capacitors , etc.
Potential operational benefits are:
— demand shifting
— peak shaving
— frequency regulation
— mitigation of variable renewable resources impact
— reductions in T&D expenditures.
�yr1
AZUSA
LIGHT h WATEH
.0 .I
u%ecommen ation
That the Utility Board :
— authorize Staff to initiate an energy storage
study as mandated by AB 2514
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7 AZrUSA
LIGHT 6 WAFES
FY12 Mid Year
Financial Report
"swoop,
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Azusa Utility Board
February 27, 2011
AZUSA
L I G H T & W 4 T E R
Qackground
° Staff regularly reviews the financial
status of the Water and Electric funds
Numbers are preliminary and
unaudited
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AZUSA
L I G H T & W A r E 8
Water
o Fiscal year-to-date cash flow positive at $ 1 .25
million
° At 12/31 /11 , the Water utility had a cash
reserve of $22 . 7 million ($25M target).
° Quarterly sales equal to prior year but down
25% from FY07
Debt service coverage of 2 . 19 ( 1 .25 minimum )
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` / J AZyUSA
L I G H f b W A i E F
Consumption-CCF: 7.384,003 4,248,276 589'
Cash and Investmertm... 5 21,444,890 S 22,693,3771 106°'
:t : : ;
• ,
Revenues
Retail Billing?mountst't S 16,923,115 S 9,315,88S 55%
Other Revenues 3,481,140 547,7702 14%
Water Interest Income 300,000 214 0%
Total Revenues S 21,40.1,533 $ 9,863,503 4696
Expenses
Production 4905,825.00 1,239,564 43%
Purchased Water 3,114,230 &15974 ' ?6
Transmission and Distribution 2,634,675 1:177,984 45%
Customer Accounting and sales ta) 4,059,174 1,376,631 3496
Administrativeand Engineering 517.385 258,666 31c*
Frmchise Fees 338,470 191,612 570c
Subtotal Expenses 5 '13,902,759 $ 5.09 ,433 3796
Capital Expenditures I Debt Service:
Debt Service Pavmernts:a) 5:1,5''5,27'1 S 2,264,135 5096
Capital Improvement Budget O) 3,250,723 1,253,7754 39%
Total Expenses(Less Bond Funding) S 21,66,753 S 8,613,3'? #096
Adjustments
i
ransfers Oue' $0 SO 096
` Total Expenditures and Transfers Out S 21,691,7753 S S,613,322) :109'
Net Change in Cash(Negative) S (27777,198 $ '1.250,451 696
Debt Coverage Ratio"' 1.73 219 �r✓
AZUSA
L I G M t b WATER
Mectric
° Positive cashflow of $2 .2 million
° Reserve level of $ 13 . 9 million . ($ 12 .6 min )
° Debt coverage of 10 . 9 is good
° Sales equaled prior year level , but down
about 10% from three years ago
12 '
AZUSA
LIGHT A WATER
Consumption-WA: 238,7728,20.3 126,3773,198 5294%
Cash/Reserve Prior Fiscal Year Endo) 511,731,632 513,999,183 119%
Revenue
atailBillingAmovntsO s34,002,525 S19,2S6.752 57%
Resale Revenue ) 6,664,395 3,75.1,411 5690'
Otkor 303,300 203,566 6700'
Mrest Income 152,915 65.239 4505
EIeetri Total Revenues $41,123,135 S23,313,01S 57%
Expenses
Purclased Power(" S26,330,710 513,784,689 52%
raunussion/Dispatching 4,150,970 2.029.SS5 49%
oration and Maintenance 3,448,8$3 1,575,325 46%
dminutrativeand.Generai(` 1,1SS,211 741.263 34%
Franchise and In-Lieu-Tax 3,400.250 1951924 57%
Subtotal Expenses 3',39,519,026 $20,085,767 51%
Capital Expenditures f Debt Service
Long Term Debt SemceOl 5943,151 $474,07/6 50%
Capital Outlays and projectst" 1,730,240 505,003 29% p�
Total Expenditures 5L'?_�;,417 521.064.365 1195 �D /r
Adjustments
zansfers Out", 9,350 0%
Total Expenditures and Transfers Out 512,236,567 521,064,S68 50%
i
� Change inCashlResene (51,113,732) $3,243,151 19°5 \,kA
Debt Coverage Ratio() S.S .9213
AZUSA
LI r H 7 b Y!4! ER
Year=end Sa0es
Water I Electric
FY CCF Sales BMings FY kWh Sales Bi.11ii► s
04-}5 51191,53'1 $8,321,053 04-05 133,339,089 $14,655;236
05-06 5,236,280 $7,874,%'d 05-06 129,8;33,967 514,380,345
06-07 5,677,810 $8,8-15,286 06-07 139,649,981 $16,052.10'3
07-08 51083,833 $8,696,748 V-08 136,375,872 S 15,872,058
08-09 1,735,337 x7,841,811 08-79 139176 034 318 776,921
09-10 4,503,313 $8,513,021 09-10 133,286,52'1 S 16 19,555
10-11 1_6.;_6 $9,248,071 10-11 126,3G�,5b1 51',8.31;281
11-12 1248,276 $9,315,888 1.1-12 126,375,19814 $19, 6,151
AZUSA
L I G H T & W A 1 E 9
Questions/Comments
r �
15 AZUSA
LIGHT A WATER
Federal Legislative Deport
° Provided periodically by Morgan Meguire
to SCPPA
• Purpose is to monitor Federal legislation
and regulations in water/energy arenas
• Federal budget for FY13 and general
energy policy are key items
F216
AZUSA
LI G H i 8 VIA1 EH
Wateir Supp �y Update
• To date, LA area has received 6 . 5 inches of
rain — 16 .3 historical average
• Sierra snowpack is only 23% of normal
° State Water Project allotment has been
reduced from 60% to 50%
• More positively, key reservoirs in state are at
high levels and Lake Mead is much improved
17 AZUSA
LIGHT & WATER
Electric Vehicle/
Charging Station Update
o L&W has solicited proposals for community electric
vehicle charging stations
— 3 bids received (about $7K each for unit only)
Plans include purchase of two electric vehicles by
L&W for demonstration
Discussions ongoing with a vendor who may have
grant funds for a couple of EV charging units
Staff will update the Utility Board at future meeting <��M
F418 lrr�
AZUSA
L I G H T A W A l E 4
Automated Trash
Coflect'gon FoHow= u
Presentation at February 21 City Council
° Next Steps
— Develop formal contract amendment
— Set up community "workshops" at Senior
Center and North Recreation Center
— Other?
F4 19 AZUSA
L I G H T 6 VIAI ER
I
A7._US.A
ucxr a 'eena
CITY OF AZUSA
MINUTES OF THE REGULAR MEETING
OF THE AZUSA UTILITY BOARD/CITY COUNCIL
MONDAY,JANUARY 23,2012—6:35 P.M.
The Utility Board/City Council of the City of Azusa met in regular session,at the above date and time,at the
Azusa Light and Water Conference Room, located at 729 N. Azusa Avenue, Azusa, California.
Vice-Chairman Carrillo called the meeting to order. Call to Order
Board Member Gonzales led in the Flag Salute. Flag Salute
ROLL CALL Roll Call
PRESENT: BOARD MEMBERS: GONZALES,CARRILLO, MACIAS, ROCHA
ABSENT: BOARD MEMBERS: HANKS
ALSO PRESENT: Also Present
City Attorney Carvalho, City Manager Makshanoff,Director of Utilities Morrow,Assistant to the Director of
Utilities Kalscheuer, Assistant Director of Water Operations Anderson, Assistant Director of Resource
Management Lehr, Public Works Director/Assistant City Manager Haes, Assistant Director of Electric
Operations Langit,Director of Economic and Community Development Christiansen,Police Officer Eldridge,
City Clerk Mendoza, Deputy City Clerk Toscano.
PUBLIC PARTICIPATION Pub Part
Mr. Jorge Rosales addressed the Board Members regarding Athens Services' Proposal on Automated Trash J. Rosales
Collection stating the item should go through the public hearing process in order to insure input by the Comments
residents.
UTILITIES DIRECTOR COMMENTS Dir Comment
None. None
UTILITY BOARD MEMBER COMMENTS' Brd Mbr Com
None. None
005
The CONSENT CALENDAR consisting of Items D-1 through D-6, were approved by motion of Board Consent Cal
Member Gonzales, seconded by Board Member Macias and unanimously carried. Appvd
I. The minutes of the regular meeting of November 28, 2011,were approved as written. Minutes appvd
2. Approval was given for the funding request of CRC in amount of$5,525 to conduct a backyard Compost
compost workshop on April 14, 2012. Workshop
3. Approval was given for the modification of Rules and Regulations Schedule RL,Residential Services Rules& Regs
with Life Support Devices,to include apnea monitors,kidney dialysis machines,and heart monitors, Schedule
provided this equipment runs on electricity supplied by Azusa Light& Water. Modification
4. The specification for a replacement Electric Utility flatbed dump truck and approval was given for its Electric Utility
purchase using the City's alternative purchasing procedure from Downtown Ford Sales in amount not- Flatbed Truck
to-exceed $67,485.25 including delivery and applicable taxes. Replacement
5. The Director of Utilities or his designee was authorized to register the City of Azusa with California GHG Program
GHG program for GHG compliance and holding accounts and to administer such in accordance with Registration
AB 32 Regulations.
6. Approval was given for the amendment of Sterling Technologies, LLC blanket purchase order for Sterling Tech.
purchase of chemicals for water treatment plant in amount of$90,000. Blanket PO
SPECIAL CALL ITEM Spec Call Item
None. None.
SCHEDULED ITEMS Sched Items
Refunding of Water Utility Long Term Debt—2003 Series A Certificates of Participation (COP). Refunding
Water Utility
Director of Utilities Morrow addressed the issue providing information regarding refinancing the Water Series Long Term
A outstanding debt,which has an average yield presently of 4.58%;this can be refinanced at a yield of 1.83% Debt—2003
based on current market; the NPV savings is estimated to be $1.3 million or about $150K per year(11.5% COP's
savings).
Moved by Board Member Rocha,seconded by Board Member Gonzales,and unanimously carried to approve Refinancing
the following items: 1)Authorize staff to commence work to refinance outstanding debt associated with 2003 Outstanding
issuance of Series A COP in amount of about$11.6 million;2)approve scopes of work included in this report Debt associated
for two requests for proposals:(a)bond and disclosure counsel;and(b)underwriter services;and 3)authorize with 2003
staff to solicit proposals for respective professional services necessary.to prepare refinancing documents. COP's
Financial Advisory Services to Refund Electric Utility Debt — 2003 Series B Certificates of Participation Financial
(COP). Advisory Svs
Director of Utilities Morrow addressed the issue providing information regarding refinancing Electric Series B Series B Cert
outstanding debt,which has an average yield presently of about 4.8%;the City's FA estimates that this series Of
can be refinanced through private placement at 3.2%,and that this would generate savings of 7.7%;the NPV Participation
saving would be about$421 K,or about$85K annually. He stated that Staff also intends to look closer at a
joint refinancing with the Water Series A to confirm private placement is the best approach.
Moved by Board Member Gonzales,seconded by Board Member Carrillo,and unanimously carried to approve PSA Urban
a professional services agreement with Urban Futures in amount not-to-exceed $19,550 to serve as financial Futures
advisor to refinance 2003 issuance of Series B COP debt in amount of about$5.3 million. Approved
01/23/12 PAGE TWO
006
*Request for Proposals(RFP)and Authorization to Solicit EngineeringServices for Sludge Handling Facility at RFP Engr Svs
the Hsu-Canyon Water Filtration Plant, Sludge
Handling
Assistant Director of Water Operations Anderson addressed the item stating that Azusa's Water treatment Anderson
Plant has been operating for approximately 2 years and the amount of sludge produced through the treatment Comments
process exceeds projections. There are presently three sludge drying beds designed to dewater using
evaporation. However,evaporation is complicated by the drying beds being located at the foot of a mountain
canyon. There are options to improve sludge handling and the input of an expert is recommended.
Moved by Board Member Rocha,seconded by Board Member Macias,and unanimously carried to approve the RFP Engr Svs
scope of work in RFP forengineering services to conduct a feasibility study of sludge handling alternatives for Approved
the Hsu-Canyon Water Filtration Plant and authorize staff to solicit proposals.
STAFF REPORTS/COMMUNICATIONS Staff Reports
San Juan Update: CEC Rulemaking Affecting Local Publicly —Owned Electric Utilities with Coal Plant San Juan
Participation. Update
Director of Utilities Morrow stated that the Sierra Club and the Natural Resources Defense Council(NRDC) Dir of Util
filed ajoint Petition with CEC related to SB 1368 which forbids California Utilities from contracting for new Comments
coal energy for more than 5 years. It also forbids utilities from making investments in existing coal power
plants that would extend life by more then 5 years. The Petitioners allege that publicly—owned utilities are
making non-compliant investments. On January 12" the CEC approved the Petition and established a
"Rulemaking" related to SB 1368 and a variety of entities testified at the meeting including Azusa who
expressed concern on what was being proposed. He stated the uncertainty of the Rulemaking adversely
impacts Azusa's planned sale of San Juan and he will keep the Board Members informed.
Report on Third Quarter Azusa Light& Water's Purchase of 15 MW of Power. Purchase Pwr
Director of Utilities Morrow addressed the issue stating that due to the 2011 coal mine fire at San Juan there is Dir of Util
a possibility that there may not be enough coal to operate the plant at full capacity in Q3 so in January 2012 Comments
Azusa purchased 15 MW of energy and capacity for Third Quarter(Q3),the price was$31.44. He detailed the
rationale for the purchase.
Assistant to the Director of Utilities Kalscheuer provided an update on Athens Services' Proposal on Update
Automated Trash Collection. He presented the proposal as follows: automated trash collection to residents Automated
using black & green 90 gall barrels, mixed wasted to Athens MRF and green waste to Puente Hills until Trash
closure then to Athens' organics facility in V ictorville, City to buy compost from Athens if needed. Annual Collection
free compost giveaway for residents. Athens indemnifies City against AB 939 fines if City does not reach Assist Dir
50%waste diversion requirement,and no additional cost except or extra barrels if needed. Request for 4 year Utilities
contract extension—upon clarification,Athens indicated they wished to extend"evergreen"by 4 years(8 years
to 12 years),this was not acceptable to L&W staff that prefer not to extend 8 year evergreen as it limits future
flexibility. Compromise scenario: Azusa will not exercise evergreen during next eight years and would have
the right to bid out waste processing services at the end of this period. Athens would have the right to match.
Athens requested that street sweeping services be added to the waste contract,Staff is reviewing. With regard
to Extra Barrels, Athens original proposal left this item for future discussion.
Lengthy discussion was held between Staff, Board Members and Mr.Chapetta of Athens Services regarding Discussion
the possible areas that may not be served,alleys and truck backing in and out,surveying of other cities,number Automated
of barrels needed, bulky item pickup, rate adjustment methodology, rates going up at landfills, not cost for Trash
equipment, alternative fuels, review process for rollout, billing rate, increase in waste diversion with the Collection
system,and two man trucks—no layoffs. It was consensus of the Board Members that Staff will bring a Power
Point presenting the issue to the public at a.Council Meeting and a public hearing to receive input from
residents.
01/23/12 PAGE THREE
007
Director of Utilities Morrow announced the American Public Power Association(APPA)Annual Conference APPA Annual
to be held from June 16-20,2012,in Seattle,Washington,and asked Board Members if they were interested in Conference
attending to contact him.
It was consensus of the Board Members to adjourn. Adjourn
TIME OF ADJOURNMENT 7:22 P.M.
SECRETARY
NEXT RESOLUTION NO. 12-C7.
01/23/12 PAGE FOUR
008
7
D V
AZUSA
CONSENT CALENDAR
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE SA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIE
DATE: FEBRUARY 27, 2012
SUBJECT: SELECTION OF BOND AND DISCLOSURE COUNSEL TO REFUND
WATER AND ELECTRIC UTILITY LONG TERM DEBT
RECOMMENDATION
It is recommended that the Utility Board approve selection of Hawkins, Delafield & Wood LLP
to serve as bond and disclosure counsel to refund a portion of the long term debt issued by the
water and electric utilities in 2003.
BACKGROUND
On January, 23, 2012, the Utility Board approved a scope of work for bond and disclosure
counsel services and authorized staff to solicit proposals on legal services to assist with
refinancing of a portion of the water and electric utilities' outstanding debt.
The request for proposals (RFP) called for separate pricing for: (1) Special Bond Counsel
Services, and (2) Disclosure Counsel Services to refund two separate certificates of participation
(COP) series, Series A — for Water Utility and Series B for the Electric Utility, both issued in
2003. A separate price quote was also sought for special counsel services on the Series B debt to
prepare and review documents associated with a private placement, should this refunding
alternative prove to be lower in cost than issuing bonds.
Staff issued the RFP on January 26, 2012, and received seven proposals by the deadline on
February 14, 2012. A summary of the price quotes from qualified law firms is provided on next
page.
009
Bond and Disclosure Counsel
February 27, 2012
Page 2
Bond/Disclosure Counsel Proposals
February 14, 2012
Series A Series B Total after Series B
-Bond Disclosure Total' Bond Disclosure Total' Total Discount Private
Placement
Hawkins Combined $43,000 Combined $20,000 $63,000 $63,000 $15,000
BBK $22,000 $16,000 $38,000 $20,000 $15,000 $35,000 $73,000 $73,000 $15,000
McFarlin $55,000 $25,000 $77,500 $27,500 $20,000 $45,000 $122,500 $122,500 $40,000
Fulbri ht $55,000 $35,000 $80,000 $45,000 $35,000 $70,000 $150,000 $135,000 $70,000
Stradling $57,400 $35,000 $92,400 $45,800 $35,000 $80,800 $173,200 $173,200 Hourl
Goodwin $65,000 $45,000 $103,000 $55,000 $35,000 $85,500 $188,500 $188,000 $80,500
Orrick $85.000 $50,000 $135,000 $45,000 $40,000 $85,000 $220,000 $220,000 $7,500
Includes discount for both Bond& Disclosure Counsel, if any
Staff reviewed the proposals according to the criteria outlined in the RFP, which included
proposal cost, qualifications and experience of key staff, and work plan and schedule. Each firm
appears well qualified, however, the cost proposal by Hawkins appears to be in the best interest
of the City and will save $10,000 compared to nearest competitor. Therefore, staff is
recommending approval of the proposal by Hawkins, which is attached for your reference.
Hawkins was founded over 150 years ago and is a nationwide full service public finance law
firm with offices in Los Angeles, San Francisco and Sacramento, Washington, D.C., New Jersey,
Connecticut, and New York. In 2011, Hawkins was ranked nationally as the number two Bond
Counsel firm and number one Underwriter's Counsel firm. Hawkins has extensive experience in
utility financings and refunding efforts for both water and public power. Since 2006, Hawkins
was involved in 69 revenue bond issuances totaling $8 billion for water and wastewater utilities,
and participated in 440 financings since 1980 related to public power. Recent customers include
such agencies as Metropolitan Water District of Southern California, State of California Water
Resources Control Board, County of Los Angeles, City of Los Angeles, City of San Diego and
City of Riverside. References checked provide an "excellent" rating of Hawkins' performance.
FISCAL IMPACT
All costs for professional services related to this refinancing will be funded from the refunding
proceeds. However, to issue a purchase order and compensate the attorney before the bond
proceeds are made available, staff will administratively process a budget amendment in the water
and electric fund accounts following approval of this item.
Prepared by:
Cary Kalscheuer, Assistant to the Director of Utilities
Attachment:
Proposal by Hawkins, Delafield & Wood LLP (excluding Appendix E)
010
r
I
PROPOSAL TO PROVIDE
BOND COUNSEL AND
DISCLOSURE COUNSEL SERVICES
is respectfully submitted to the
CITY OF AZUSA
in connection with its
REFUNDING OF WATER AND ELECTRIC UTILITY DEBT
February 13, 2012
DELARELD&SNOOD LLP
333 South Grand Avenue,Suite 3650
Los Angeles,California 90071
www.hawkins.com
Contact: Diane K. Quan
One Chase Manhattan Plaza
New York,NY 10005
One Embarcadero Center Meridian Plaza—1415 L Street
San Francisco, CA 94111 Sacramento,CA 95814
621 South West Morrison Street 601 Thirteenth Street, N.W.
Portland,OR 97204 Washington,D.C. 20005
20 Church Street One Gateway Center
Hartford, CT 06103 Newark,NJ 07102
011
DELAFIELD&WOOD LLP
PHONE: (213)236-9050 333 SOUTH GRAND AVENUE NEW YORK
FAX: (213)236-9060 SUITE 3650 WASHINGTON
LOS ANGELES,CA 90071 NEWARK
WWW.HAW KINS.COM HARTFORD
LOS ANGELES
PORTLAND
SACRAMENTO
SAN FRANCISCO
February 13, 2012
Mr. George F. Morrow
Director of Utilities
Azusa Light & Water
729 North Azusa Avenue
Azusa, California 91702
Re: City of Azusa Request for Proposals—Bond and Disclosure Counsel Services
for Refunding Water and Electric Utility Debt
Dear Mr.Morrow:
Hawkins Delafield & Wood LLP ("Hawkins" and the "Firm") appreciates the opportunity to present
this Proposal (the "Proposal") to the City of Azusa (the "City") in response to the Request for Proposals —
Bond and Disclosure Counsel Services for Refunding Water and Electric Utility Debt, dated January 26, 2012
(the"Request").
For more than 150 years, Hawkins has maintained a reputation for excellence, timeliness, discretion
and ethical service in the highly visible representation of many of the nation's governmental bodies and
agencies and the world's leading financial institutions. We offer a proven, historic commitment to public
finance and a determination to remain a major force within the public finance industry. We believe that out
California experience, coupled with our national practice, provides us with a depth and breadth of experience
in the area of public finance unmatched by other firms.
Hawkins continues to build upon our reputation for providing seasoned advice and critical perspective
to municipal clients in part by remaining focused on all aspects of our clients' financings, never losing sight of
the importance of reliable guidance, timely delivery and attention to detail in the successful completion of any
financing. To that end, we return telephone calls promptly, review, comment to and distribute documents in a
timely manner and adjust our schedules to make partners of the Firm available for meetings and conference
calls. Further, we work closely with our clients' staff, advisors and consultants in a professional and collegial
manner to ensure a seamless, concerted approach to a successful financing.
Hawkins is uniquely qualified to perform Bond Counsel and Disclosure Counsel services for the
City's anticipated refunding of water and electric utility debt for the following reasons:
• Hawkins is among the most experienced public finance law firms in the nation and in the State
of California (the"State"),and we maintain top tier national and State rankings. Our growth in
California over the last 20 years has made us one of the top public finance practices in the
State and we are committed to expanding our practice and services. In 2011, we were ranked
nationally as the number two Bond Counsel firm and the number one Underwriter's Counsel
firm.
012
• Hawkins has significant recent experience and historical background in utility financings and
certificate of participation financings, and has proven expertise in the Bond and Disclosure
Counsel work attendant to such financings. This includes our bond and disclosure counsel
work for The Metropolitan Water District of Southern California, the State of California
Water Resources Control Board for its conduit financing through the California Infrastructure
and Economic Development Bank and the City of San Diego for its Water Revenue Bonds.
and our disclosure work in connection with the City of Los Angeles' wastewater system and
for the Rancho California Water District. Our public power and energy-related clients
represent entities from across the country, including California, Washington, Oregon, Texas,
New York,Maine, North Carolina, South Carolina,Oklahoma and Vermont.
• We have preeminent experience with federal tax laws. Hawkins has one of the municipal
industry's largest and most experienced tax departments devoted primarily to public finance.
• Hawkins has considerable experience as Disclosure Counsel to public issuers and is uniquely
qualified to advise clients regarding primary disclosure and compliance with the continuing
disclosure requirements of Rule 15c2-12 of the Securities and Exchange Commission. Our
national public finance practice, which covers the entire breadth of the diverse practice area of
municipal finance, affords us a unique perspective on disclosure matters under the federal
securities laws.
• The Firm continues to expand its commitment to public finance. In December 2011, the Firm
opened an office in Portland, Oregon with the addition of rive public finance attorneys from
one of the most prominent firms in the State of Oregon.
The Firm respectfully proposes that Bond Counsel and Disclosure Counsel services be under the
supervision of Diane K. Quart. All proposal communications may be addressed to Ms. Quart c/o Hawkins
Delafield & Wood LLP, 333 South Grand Avenue, Los Angeles, California 90071 or emailed to
dquan@hawkins.com. We respectfully propose the following fixed fees for the services described in the
Request: $43,000 for Bond and Disclosure Counsel services in connection with the Series A Certificates of
Participation refunding, $20,000 for Bond and Disclosure Counsel services in connection with the Series B
Certificates of Participation refunding and $15,000 for Bond Counsel services in connection with the Series B
Certificates of Participation refunding(private placement). We are prepared to dedicate the time and resources
necessary to accommodate the City's schedule and we are confident of our ability to provide these legal
services at competitive rates.
Thank you for the opportunity to submit this Proposal. Please call me should you wish to discuss any
matters that are not covered in this Proposal or to obtain clarification on any particular point. We very much
hope to work with the City as Bond Counsel and Disclosure Counsel on this important financing.
Very truly yours,
HAWKINS DELAFIELD &WOOD LLP
BY
OeQu:an, Partner
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v
TABLE OF CONTENTS
Page
1. Company and Staff Qualifications................................................................................................... 1
A. Proposer's Principal Place of Business and Related Information....................................... I
B. Project Team Location and Related Information................................................................ 1
C. Participation by Other Firm of Subcontractor..................................................................... 1
D. Overall Company Experience in Utility Infrastructure Financings and Debt
Refunding............................................................................................................................ 1
I. Water and Wastewater Financings......................................................................... 1
2. Power and Energy Financings...............................................................................3
3. Debt Refundings....................................................................................................4
E. List of Recent Financings,Refundings or Bond Issuances.................................................4
F. References.....:.....................................................................................................................5
G. Primary Attorneys...............................................................................................................6
H. Estimated Hours..................................................................................................................8
1. General Resumes ................................................................................................................8
1. Firm Description....................................................................................................8
2. Certificates of Participation and Lease Revenue Bonds Experience.....................9
3. Disclosure Experience......................................................................................... 11
❑. Work Plan...................................................................................................................................... 1 I
III. Data Request.................................................................................................................................. 12
IV. Scope Exclusions/Addenda............................................................................................................ 12
V. Deliverables................................................................................................................................... 12
VI. Schedule......................................................................................................................................... 13
VII. Lump Sum Not-To-Exceed Fee..................................................................................................... 13
VIII. Fee Schedule/Hourly Rates............................................................................................................ 14
D;. Other Client Commitments............................................................................................................ 14
X. Other.............................................................................................................................................. 14
Appendix A—Hawkins California Water and Wastewater Financings 2007 through 2011
Appendix B—Hawkins California Power/Electric Financings 2007 through 2011
Appendix C—Hawkins California Certificates of Participation and
Lease Revenue Bond Financings 2007 through 2011
Appendix D—Hawkins California Refundings 2007 through 2011
Appendix E—Hawkins California Financings 2007 through 2011
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1. Company and Staff Qualifications
A. Proposer's Principal Place of Business and Related information
Name of Firm and Address: Hawkins Delafield&Wood LLP
333 South Grand Avenue,Suite 3650
Los Angeles, California 90071
Telephone: (213) 236-9050
Facsimile: (213)236-9060
B. Project Team Location and Related Information
Bond and Disclosure Counsel services would be provided by our Los Angeles office, which is
located at the address set forth in Section I.A. above. Tax review and related refunding analysis would be
provided by Russell A. Miller, a tax partner in our San Francisco office. The contact information for Mr.
Miller is as follows:
Name of Firm and Address: Hawkins Delafield&Wood LLP
One Embarcadero Center, Suite 3820
San Francisco,California 94111
Telephone: (415)4864200
Facsimile: (415) 397-1513
C. Participation by Other Firm of Subcontractor
No subcontractor or other firm will be involved in the provision of services.
D. Overall Company Experience in Utility Infrastructure Financings and Debt
Refunding
1. Water and Wastewater Financings
Hawkins is one of the most experienced firms in the nation in water and wastewater financings.
We have participated in more than 69 water and wastewater revenue bond issues since 2006, aggregating
more than $8.0 billion in principal amount. We have played a leading legal role in the development of
financing and loan programs for environmental facilities such as water supply and water pollution control
facilities. Hawkins has extensive experience as public finance counsel for public water facilities and
projects throughout the country, ranging from small rural villages and counties to large urban cities,
counties and state water revolving funds. Our representative California experience includes water and
wastewater transactions for Metropolitan, the City of San Diego, the Rancho California Water District,
the California Infrastructure and Economic Development Bank, the California Statewide Communities
Development Authority, the State of California Water Resources Control Board, the Redondo Beach
Public Finance Authority, the San Jose-Santa Clara Water Finance Authority and the Hollister Joint
Powers Financing Authority, and the Cities of Chino, Coachella,Los Angeles, Oxnard, Riverside,Tulare
and Watsonville.
Diane K. Quan, who is proposed as the lead attorney for Bond and Disclosure Counsel services,
has been principally involved in many of Hawkins' California water and wastewater financings. Attached
as Appendix A is a list of Hawkins' California water and wastewater financing experience from 2007
through 2011. The following are examples of certain recent California water and wastewater financings.
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• City of Los Angeles. Hawkins has served as Disclosure Counsel to the City of Los
Angeles in connection with its Wastewater System Revenue Bonds for nearly decade.
We currently serve as Disclosure Counsel to the City of Los Angeles in connection with
its contemplated issuance of five series of bonds, the proceeds of which will be used to
current and advance refund certain outstanding senior and subordinated obligations of the
City. We also served as Disclosure Counsel for the City's Water System Revenue Bonds,
Refunding Series 2009-A and $444,600,000 Wastewater System Subordinate Revenue
Bonds,Variable Rate Refunding, Series 2008.
• Rancho California Water District Financing Authority. Hawkins has served as
Underwriters' Counsel on debt issuances by Rancho for many years,and has prepared the
disclosure documents in each of the public offerings. Through the course of our
representation, we diligently and actively participated in discussions regarding the
structure of financings, reviewed bond documents and prepared certain other financing
documents. We also set forth in the disclosure documents the structure of the financings
and the particulars of the water and wastewater revenue stream securing the debt
obligations, taking great care to review and confirm the water system-specific
information contained in the offering document. Rancho utilizes a master installment
purchase agreement and standalone indentures pursuant to which individual series of
senior or subordinated debt are issued. In 2011, we served as underwriter's counsel and
prepared the disclosure documents for the $9,870,000 Rancho California Water District
Financing Authority Fixed Rate Revenue Bonds, Series 2011A (Qualified Energy
Conservation Bonds) and the $44,625,000 Rancho California Water District Financing
Authority Adjustable Rate Refunding Revenue Bonds Series of 2008B (Remarketing).
• Eastern Municipal Water District. Hawkins served as Underwriter's Counsel in
connection with the District's $56,255,000 Refunding Water and Sewer Revenue Bonds,
Series 2011 A. The bonds were limited obligations of the District payable solely from
net water and sewer revenues of the District's water and sewer system.
• City of San Diego. Hawkins served as Bond Counsel for the City of San Diego's Water
Revenue Bonds, Series 2009B and Disclosure for the City's Sewer Revenue Bonds,
Series 2009A and Sewer Revenue Refunding Bonds, Series 2009B. We also served as
Disclosure Counsel for the City's Water Revenue Bonds, 2009A, which was the first
public debt issuance for the City in nearly six years. Through the course of our
representation of the City as Disclosure Counsel, we thoroughly reviewed alongside
Bond Counsel the Master Installment Purchase Agreements and the related legal
mechanisms through which the City's water revenue stream and sewer revenue stream, as
applicable, flows through the City's financing authority before reaching the bondholders.
We have actively worked to confirm the theories and conclusions proffered by counsel
and described the resulting structure and potential bondholder considerations. Hawkins
also served as Bond Counsel and Disclosure Counsel for many other City financings,
including as Bond Counsel for the City's $152,000,000 Non-Transferable Subordinated
Sewer Revenue Bonds, Series 2004 and $57,000,000 Non-Transferable Subordinated
Water Revenue Notes, Series 2007A and as Disclosure Counsel for the City's recent
issuance of $157,190,000 Water Revenue Bonds, Refunding Series 2009A and
$150,000,000 Subordinated Water Revenue Notes, Series 2008A.
• The Metropolitan Water District of Southern California. The Firm has served as Bond
Counsel and Disclosure Counsel to MWD for many of its issuances of general obligation
bonds and water revenue bonds since 1996, and we are very familiar with the master
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resolution and supplemental resolutions pursuant to which MWD authorizes the issuance
of its bonds. The master and supplemental resolutions structure created by MWD permits
the delegation of specific financing authority to members of a special committee, which
committee is responsible for carrying out the Board's intent by considering and ratifying
the issuance of bonds subject to certain parameters and terms and conditions. We have
been selected as Bond Counsel for MWD's upcoming issuance of bonds. In 2010, we
served as Co-Bond Counsel to MWD for its $250,000,000 Water Revenue Bonds 2010
Authorization, Series A (Taxable Build America Bonds). In 2009, we served as Co-Bond
Counsel to MWD for its $81,065,000 Water Revenue Refunding Bonds, 2009 Series D
(Tax-Exempt Refunding Bonds) and its $250,000,000 Water Revenue Bonds, 2008
Authorization, Series D(Taxable Build America Bonds).
• State of California Water Resources Control Board. Hawkins currently serves as
Special Counsel to the State Water Board and, among other things, has assisted in the
preparation of the form of Project Finance Agreement for loans of amounts from the
Clean Water State Revolving Fund (the "State Revolving Fund"). We also serve as bond
counsel for the State Water Board's upcoming revenue bond issuance. In 2002, we
served as Bond Counsel to the California Infrastructure and Economic Development
Bank for the initial issuance of $300,000,000 Clean Water State Revolving Fund
Revenue Bonds, Series 2002, which were secured by certain State Revolving Fund loans.
During the course of this representation, Hawkins provided legal advice to the State
Water Board on issues of first impression that arose under the initial issuance of bonds
under the State Revolving Fund program. We substantially revised many of the
documents in the State Water Board's State Revolving Fund program. We participated in
the extensive revision of the State Water Board's Policy for Implementing the State
Revolving Fund in compliance with the federal and state clean water programs and the
financing requirements of the bonds under the State Revolving Fund program. In
addition, we reviewed all financing documents on behalf of the State Water Board, laws
pertaining to the State Water Board, laws pertaining to the federal clean water program
and laws pertaining to California clean water program.
• California Statewide Communities Development Authority. The California Statewide
Communities Development Authority's Water and Sewer Pooled Financing Program was
formed by a partner of the Firm and we have served as both Bond Counsel and
Disclosure Counsel for the Program since its inception. The structure used in such
financings are similar to those used by many other governmental entities in the State,
except modified to permit pooling so as to facilitate economy of size savings for obligors.
Over the last decade, we have served as Bond Counsel and Disclosure Counsel to the
Authority for more than 25 bond issues involving borrowings by local agencies in an
aggregate of more than $523 million.
2. Power and Energy Financings
In addition to our experience in water and wastewater transactions, Hawkins is the nation's
leading Bond Counsel firm in public power finance. Eleven of the Firm's.partners and counsel have
significant public power and energy finance experience. Since 1980, the Firm is ranked number one as
Bond Counsel in the nation in the public power practice area. During this period we participated in more
than 440 financings in this practice area as Bond Counsel, Underwriter's Counsel and Special Tax
Counsel.
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Our public power and energy-related clients have come from all over the country: California,
Maine,New York,North Carolina, Oklahoma,Oregon, South Carolina,Texas, Vermont, Washington and
elsewhere. These clients include integrated and special purpose electric utilities with small, medium and
large-scale operations and projects. Because of this extensive experience, we are familiar with the
differing needs of utilities and projects based on the nature of the transaction and the participants
involved.
Attached as Appendix B is a list of Hawkins' California power and electric financing experience
from 2007 through 2011. The following are examples of our recent representations in connection with
various power and electric financings in California.
• State of California Department of Water Resources. The Firm has particular expertise
with extremely complex revenue bond transactions. We recently served as Bond Counsel
to California's Department of Water and Resources("DWR") for its $959,565,000 Power
Supply Revenue Bonds, Series 2011N. We also served as Bond Counsel to DWR for its
$11.25 billion revenue bond issue to reimburse the State's general fund for amounts
advanced to pay power costs during the state's power crisis, and the subsequent
$2.6 billion advance refunding of a portion of those bonds utilizing swaps and variable
rate debt. In 2008, we served as Bond Counsel for DWR's approximately $1.8 billion
refunding revenue bonds.
• Imperial Irrigation District. In 2011, we served as Underwriter's Counsel in connection
with the Imperial Irrigation District's $78,065,000 Electric System Refunding Revenue
Bonds, Series 2011 A, $75,485,000 Electric System Refunding Revenue Bonds, Series
2011 B and$75,745,000 Electric System Refunding Revenue Bonds, Series 2011 C.
• City of Riverside. Hawkins has worked with the City of Riverside for several years, first
as Underwriter's Counsel and most recently as Bond Counsel. In 2010, we served as
Bond Counsel to the City in connection with its $133,290,000 Electric Revenue Bonds,
Issue of 2010A (Federally Taxable Build America Bonds- Direct Payment) and
$7,090,000 Electric Revenue Bonds, Issue of 2010B (Tax Exempt; Bank Qualified),
$56,450,000 Variable Rate Refunding Electric Revenue Bonds, Issue of 2011A.
3. Debt Refundings
Hawkins has served as bond counsel, underwriter's counsel and disclosure counsel in connection
with numerous current and advance refundings for issuers throughout the State of California and the
nation. In the course of a refunding, we diligently work within the parameters of the outstanding
obligations to ensure that all applicable tax requirements are satisfied, notices are given and funds are
transferred, and that repayment and defeasance are achieved. Attached as Appendix\D is a list of
Hawkins' California refunding experience from 2007 through 2011. See also Section 1.1.3 hereof for a
description of our disclosure experience and our work on certificates of participation and lease revenue
bond financings.
E. List of Recent Financings,Refundings or Bond Issuances
Ms. Quan has served and continues to serve as the primary draftsman of bond documents and
disclosure materials for a number of issuers, including:
• City of Los Angeles — Wastewater System Revenue Bonds and City of Los Angeles
Wastewater System Subordinate Revenue Bonds. Hawkins currently serves as
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Disclosure Counsel to the City of Los Angeles in connection with its contemplated
issuance of five series of bonds, the proceeds of which will be used to current and
advance refund certain outstanding senior and subordinated obligations of the City.
• Municipal Improvement Corporation of Los Angeles — Lease Revenue Bonds.
Hawkins currently serves as Disclosure Counsel to the City of Los Angeles in connection
with its lease revenue bonds,the proceeds of which will be used to finance certain capital
improvements and refund certain outstanding commercial paper notes and other
obligations of the Corporation.
• County of Los Angeles—2012 Refunding Certificates of Participation (Disney Concert
Hall Parking Garage). Hawkins currently serves as Underwriter's Counsel responsible
for the preparing the Official Statement for the County's current certificates of
participation refunding. Hawkins has also served as Bond Counsel to the County for a
number of financings, including the County's 2011 Tax and Revenue Anticipation Notes
and the County's current A.B. 811 Property Assessed Clean Energy financing.
• The Metropolitan Water District of Southern California. Hawkins has also served as
Bond Counsel to MWD on a number of new money financings, refunding and
remarketings. With respect to new issues, in 2010, Hawkins served as Co-Bond Counsel
to MWD for its $250,000,000 Water Revenue Bonds 2010 Authorization, Series A
(Taxable Build America Bonds). In 2009, we served as Co-Bond Counsel to MWD for
its $81,065,000 Water Revenue Refunding Bonds, 2009 Series D (Tax-Exempt
Refunding Bonds) and its $250,000,000 Water Revenue Bonds, 2008 Authorization,
Series D(Taxable Build America Bonds).
F. References
The Metropolitan Water District
of Southern California
Legal: Sydney Bennion, Esq.
Deputy General Counsel
The Metropolitan Water District
of Southern California
350 South Grand Avenue, 29th Floor
Los Angeles, California 90071
Telephone: (213) 217-6308
Email: sbennion@mwdh2o.com
Business: Mr.Keith Norris
Manager,Treasury and Debt Management
The Metropolitan Water District
of Southern California
350 South Grand Avenue, 29th Floor
Los Angeles, California 90071
Telephone: (213)217-7517
Email knorris@mwdh2o.com
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i
City of San Diego
Legal: Brant Will, Esq.
Deputy City Attorney
City of San Diego
1200 Third Avenue, Suite 1100
San Diego,California 92101
Telephone: (619)533-5684
Email: bwill@sandiego.gov
Business: Ms. Lakshmi Kommi
Debt Management Director
City of San Diego
202 C Street, 7th Floor,M.S. 7B
San Diego, California 92101
Telephone: (619) 236-6928
Email: Ikonuni@sandiego.gov
County of Los Angeles
Legal: Cammy DuPont, Esq.
Principal Deputy County Counsel
County of Los Angeles
Office of County Counsel
500 West Temple Street, Room 648
Los Angeles, California 90012
Telephone: (213)974-1901
Email: cdupont@counsel.lacounty.gov
Business: Mr. Doug Baron
Assistant Director of Public Finance
Treasurer and Tax Collector's Office
Hall of Administration
500 West Temple Street
Los Angeles, California 90012
Telephone: (213)974-8359
Email: dbaron@ttc.lacounty.gov
G. Primary Attorneys
Diane K. Quan is proposed as the lead attorney for Bond and Disclosure Counsel services in
connection with the City's anticipated financing. Ms. Quan would be the primary point of contact for the
City and the person directly responsible for the drafting of disclosure documents and legal document
review. John Pirog, a partner in our Sacramento office with significant energy experience, would
participate in the proposed engagement. Other partners, associates and paralegals would be available and
assigned as needed, under the supervision of the partners, to ensure that the full breadth of the Firm's
resources is available to the City. Following are brief resumes for the attorneys proposed to be principally
involved in City matters.
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Diane K. Quan, Partner. Preparatory Education - Yale College, Yale University (B.A.); Legal
Education — UCLA School of Law (J.D.). Ms. Quan has over a decade of securities and governance,
experience. She joined the Firm in 2002 as an associate attorney and became a partner of the Firm in
2007. In addition to water financings, Ms. Quan has participated in transactions involving wastewater
financings, transportation financings, revenue bond financings, general obligation bond financings,
assessment district financings, tobacco settlement securitization financings, housing financings, state
revolving fund financings, pooled financings, cash flow financings, commercial paper financings, tax
allocation bond financings and conduit financings for 501(c)(3) borrowers. Ms. Quan has participated as
Bond Counsel and Disclosure Counsel for a variety of issuers, including The Metropolitan Water District
of Southern California, the State of California Water Resources Control Board, the Counties of San
Bernardino, Los Angeles, San Diego, Fresno, Humboldt and Stanislaus, the Cities of Los Angeles, San
Diego and Manhattan Beach, the Los Angeles Unified School District, the Los Angeles County
Transportation Authority, the California Infrastructure and Economic Development Bank, the California
Municipal Finance Authority, the County of Los Angeles Office of Education, the Redevelopment
Agency of the City of San Diego, and The Community Redevelopment Agency of the City of Los
Angeles. Ms. Quan has also served or participated as Underwriter's Counsel to various major investment
banking firms in connection with a variety of financings in the State. Ms. Quan is a member of the
California State Bar,the American Bar Association and the National Association of Bond Lawyers.
John B. Pirog, Partner. Partner—Preparatory Education — Washington & Lee University
—B.S.; Legal Education—Wake Forest University. Mr. Pirog joined Hawkins as partner in 1992.
Mr. Pirog was the firm's supervising attorney in the negotiation and renegotiation of the
California Department of Water Resource's long-term power purchase agreements and related
gas purchase agreements and assisted the Department in its short-term power purchase program
and on a wide range of other matters and programs. Mr. Pirog represented the California Power
Authority in its initial peaking plant and renewable resource acquisition program. Mr. Pirog has
participated in a wide range of public power transactions as contract, bond or underwriter's
counsel, including transactions with Imperial Irrigation District, Lower Colorado River
Authority, Austin, Texas, Northern Municipal Power Authority, Klamath Falls, Oregon,
Muscatine, Iowa, Oklahoma Municipal Power Authority and Heartland Consumers Power
District. Mr. Pirog has extensive experience in advising clients in connection with all types
power and gas purchase agreements, including power purchases utilizing the EEI and WSPP.
forms, gas purchases utilizing the GISB and NAESB forms and gas hedges utilizing the ISDA
form. He has working on base load, peaking and tolling power purchase agreements using
market and capacity and energy pricing mechanisms as well as demand reduction and
renewables agreements. He has negotiated agreements with investor-owned utilities, independent
power producers and marketers and power cooperatives in the capacity of contract, bond or
underwriter's counsel, including long-term power purchase agreements for the purchase of
power by investor-owned utilities and power cooperatives from governmentally owned and
financed power plants and wholesale agreements for the purchase of power by power
cooperatives from public power systems, including transactions involving long-term agreements
with Iowa Electric Light and Power Company; the wholesale power cooperative customers of the
Lower Colorado River Authority; Minnkota Power Cooperative; PacifiCorp and Pacific Power
Marketing and others.
Russell A. Miller, Partner. Preparatory Education — University of Southern California (B.S.
1981); Legal Education — University of Santa Clara (J.D. 1984) and New York University (LL.M. in
Taxation, 1987). Mr. Miller joined Hawkins in 2000 as a tax partner. Mr. Miller concentrates in the area
of federal income taxation relating to tax-exempt bonds. Mr. Miller's experience includes the full range of
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tax-exempt financings of all types of public agencies, including lease revenue and certificate of
participation financings,private activity bonds, including health care bonds,enterprise revenue bonds and
working capital financings. Mr. Miller has served as Bond Counsel on lease revenue bond and certificate
of participation financing for the Counties of San Bernardino and Fresno,the Cities of San Diego and Los
Angeles, the Los Angeles Unified School District and many other school districts in the State. Mr. Miller
is a member of the California State Bar, the New York State Bar, the American Bar Association (Tax-
Exempt Financing Committee) and the National Association of Bond Lawyers.
Nnanna F. Ogbu, Associate. Preparatory Education — Stanford University (B.A. 2001); Legal
Education— University of Southern California—Gould School of Law (].D. 2006). Mr. Ogbu joined the
Firm as an associate attorney in 2007. He has participated in a variety of financings including general
obligation bonds,tax and revenue anticipation notes,certificates of participation and lease revenue bonds,
water and wastewater financings, education financings, pooled financings and conduit financings for
501(c)(3) borrowers. in particular, Mr. Ogbu has participated as Bond Counsel, Disclosure Counsel or
Underwriter's Counsel on education financing for the District, the Los Angeles County Office of
Education and the Orange County Office of Education. Mr. Ogbu has also participated as Bond Counsel
and Disclosure Counsel on transactions for issuers including The Community Redevelopment Agency of
the City of Los Angeles, the Redevelopment Agency of the City of San Diego, the Los Angeles County
Metropolitan Transportation Authority, the Counties of Fresno, Los Angeles and San Bernardino and the
City of San Diego. Mr. Ogbu has also participated as Underwriter's Counsel to various major investment
banking firms in connection with a variety of financings in the State. Mr. Ogbu is a member of the State
Bar of California,the American Bar Association and the National Association of Bond Lawyers.
H. Estimated Hours
Hawkins is prepared to dedicate the time and resources necessary to accommodate the City's
schedule. We appreciate the importance of timeliness, particularly with respect to document delivery,
agenda deadlines and posting schedules. We are proud of our ability to deliver quality service under
stringent time constraints, and of our responsiveness under the most trying of circumstances. We have the
resources available to prepare documents as required by our clients, and our email distributions facilitate
immediate document delivery.
The number of hours required to complete the financing, including preparation, approval and
negotiation of all financing documents and disclosure materials, depends in large part on a number of
factors that cannot be determined at this time. Such factors include whether the City elects to utilize a
financing structure substantially similar to the 2003 financing and the availability of information required
for the disclosure materials. In addition, given the number of years since the City's last enterprise fund
public issuance, the disclosure from 2003 will need to be substantially revised to reflect current concerns
and disclosure standards, including the impact of any retirement and post-employment benefits. Given the
variables, it would not be unreasonable to expect that 100 hours of work will be required for the two
financings described in the Request.
1. General Resumes
1. Firm Description
Firm History. Hawkins was founded in 1854 as a general practice firm specializing in business
and today, we are recognized for our leading position in the field of public finance. For more than 150
years, Hawkins has maintained a reputation for excellence, discretion and ethical service in the highly
visible representation of many of the nation's governmental bodies and agencies and the world's leading
financial institutions. Hawkins is the only national law firm in the United States whose practice is
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devoted primarily to public finance and public projects. In 2011, we were ranked nationally as the
number two Bond Counsel firm and the number one Underwriter's Counsel firm. Hawkins has one of the
municipal industry's largest and most experienced tax departments devoted primarily to public finance.
We offer a proven, historic commitment to public finance and a determination to remain a major force
within the public finance industry. Our concentration of expertise in the wide array of matters relating to
public finance constitutes an unparalleled resource for our clients.
We have served as Bond Counsel, Disclosure Counsel and Underwriter's Counsel in connection
with all types of complex tax-exempt and taxable financings nationally and in California. The Firm's
involvement with a broad range of public finance clients enables the Firm to utilize ideas and concepts
developed in one area of public finance and apply them in other areas. Set forth below is a description of
the Firm's experience related to the District's proposed financing.
California Public Finance Experience. Hawkins is among the most experienced public finance
law firths in the State of California (the"State"). The Firm is consistently ranked as one of the top Bond
Counsel, Disclosure Counsel and Underwriter's Counsel firms in the State. We have participated in
transactions as Bond Counsel, Disclosure Counsel, Special Tax Counsel and Underwriter's Counsel for
issuers such as the State and its various agencies and departments, the District, the California
Infrastructure and Economic Development Bank and the California Municipal Finance Authority, the
Counties of Los Angeles, Fresno, Humboldt, Kern, Orange, Sacramento, San Bernardino, San Diego and
Stanislaus, the Cities of Los Angeles, Manhattan Beach, San Diego, San Francisco, San Jose and Tulare,
the Los Angeles County Metropolitan Transportation Authority, the Los Angeles County Board of
Education, the Metropolitan Water District of Southern California, the Housing Authority of the County
of Los Angeles, the Housing Authority of the City of Los Angeles, The Community Redevelopment
Agency of the City of Los Angeles, and the California Statewide Communities Development Authority in
connection with education financings, tax and revenue anticipation notes, general obligation bonds, water
and wastewater financings, assessment and special tax financings, certificates of participation financings
and lease revenue financings for a full range of equipment and real estate projects for various
governmental purposes, such as highways, schools and governmental buildings, revenue financings for
solid waste disposal and resource recovery, refundings, housing financings, redevelopment and industrial
development bond financings, transportation financings, nonprofit healthcare financings, conduit
financings and financings for public power, student loans, hospital, convention centers, commercial
development, dock and wharf facilities and other exempt facilities. Our California experience, coupled
with our national practice, provides us with a depth and breadth of experience in the area of public
finance unmatched by other firms.
A list of the Firm's California financing experience as Bond Counsel from 2007 through 2011 is
attached as Appendix E.
2. Certificates of Participation and Lease Revenue Bonds Experience
Hawkins has been a long-standing leader in the lease revenue area. In our continuing work in the
development of new programs and financing techniques for governmental enterprises, Hawkins continues
to play a vital role in this important sector. The Firm has developed and participated in the development
of a number of unique and complex financing techniques for a wide variety of financings and for many
different programs structured as certificates of participation and lease revenue bonds. Hawkins is actively
engaged in all phases of lease revenue financing from drafting legislation and providing new programs to
developing new techniques to ensure greater efficiency and speed of market access for well-established
lease revenue issuers. We are thoroughly familiar with the legal and financial issues that arise in the
course of these financings, the required documentation, the real estate and equipment acquisition issues
and all aspects of federal tax law as it pertains to these financings. Hawkins' lease revenue practice
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includes financings secured by service contracts, special fund revenues, improvement City assessments,
as well as the general funds or assets of governmental authorities and agencies. Attached as Appendix C
is a list of Hawkins' California certificates of participation and lease revenue bond financing experience
from 2007 through 2011. The following are brief summaries of some of our recent representations in
connection with such financings.
• County of Shasta. In November 2011,the Firm served as Bond Counsel to the County of
Shasta for a privately placed $5,325,000 lease financing which refunded outstanding
2003 Certificates of participation.
• Los Angeles Unified School District. The Firm has served as Bond Counsel and
Disclosure Counsel to the Los Angeles Unified School District for many financings over
the last few years. In 2010, Hawkins served as Disclosure Counsel to the District in
connection with its $83,345,000 Certificates of Participation 2010 Series B-1 (Federally
Taxable Direct Pay Build America Bonds)(Capital Projects I) and 2010 Series B-2 (Tax-
Exempt)(Capital Projects I).
• City of Los Angeles. Hawkins has served as Bond Counsel for the City of Los Angeles'
$300 million Municipal Improvement Corporation of'Los Angeles Lease Revenue
Commercial Paper Program and as Disclosure Counsel and Underwriter's Counsel in
connection with several certificates of participation financings for the City of Los
Angeles. The Firm is presently engaged as Disclosure Counsel for the City's proposed
lease revenue bonds, proceeds of which will be used to refinance the costs of various
capital equipment and improvements to certain real property and to refinance certain
outstanding 2003 Certificates of participation of the City. In 2008, we served as
Underwriter's Counsel for the City's $105,090,000 (Municipal Improvement Corporation
of Los Angeles) Lease Revenue Bonds Series 2008-A (Capital Equipment) and
$43,790,000 (Municipal Improvement Corporation of Los Angeles) Lease Revenue
Bonds Series 2008-B (Real Property).
• City of Newport Beach. In 2010, Hawkins served as Disclosure Counsel to the City of
Newport Beach in connection with its $20,085,000 Certificates of Participation 2010A
(Tax Exempt)(Civic Center Project/Central Library Refunding) and $106,575,000
Certificates of Participation 2010B (Federally Taxable Direct Pay Building America
Bonds)(Civic Center Project).
• County of San Bernardino. The Firm has served as Bond Counsel and Disclosure
Counsel to the County of San Bernardino on several certificates of participation
transactions. In 2008, Hawkins served as Disclosure Counsel on the County of San
Bernardino's $8,860,000 Certificates of Participation (2008 Refunding Program) Series
A and $80,085,000 Taxable Certificates of Participation (2008 Refunding Program)
Series B.
• Los Angeles County Office of Education. Over the past two decades, we have served as
Bond Counsel in connection with pooled financings for approximately 30 community
college districts and school districts in Los Angeles County, which are issued through
certificates of participation by the Los Angeles County Office of Education. In 2010
$3,215,000 Certificates of Participation were executed and delivered for Montebello
Community College District and $13,945,000 Certificates of Participation were executed
and delivered for Santa Monica Community College District on which we served as Bond
Counsel.
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3. Disclosure Experience
Hawkins has extensive experience nationally and in California serving as Disclosure Counsel
responsible for the issuer's compliance with federal securities laws. Our national public finance practice,
which covers the entire breadth of the diverse practice area of municipal finance, affords us a unique
perspective on disclosure matters under the federal securities laws. We have been engaged by
governmental entities, including the City of San Diego, to provide mandatory training to their staff,
officials and other representatives in connection with their disclosure obligations under federal and state
securities laws, whether the disclosure appears in the form of official statements, continuing disclosure
annual reports, comprehensive annual financial reports, credit rating agency materials or investor
webpage materials. Our familiarity with financings of all types, together with our federal securities laws
expertise, allows us to assist issuers to anticipate potential disclosure issues and resolve them in due
course. The Firm is also uniquely qualified to advise clients regarding compliance with the continuing
disclosure requirements of U.S. Securities Exchange Commission ("SEC") Rule 15c2-12 and all other
disclosure mandated by general securities law affecting the issuance of state and local government
obligations.
Hawkins' attorneys have prepared comment letters to recent proposed SEC rules, regulations and
initiatives in the public finance sector and engaged in informal contacts with staff at the SEC involved in
these matters. Through the course of the recent market turmoil that affected municipal securities,
attorneys at the Firm participated in key initiatives of the public finance community with the SEC, as well
as the IRS. Our involvement in these matters affords us unique insight into current disclosure issues
affecting municipal issuers.,
H. Work Plan
As Bond Counsel on a transaction, we work closely with our clients' staff and professional
advisors in a professional and collegial manner. We are steadfastly and continuously diligent, responsive
and attentive to our clients' needs.
The Firm's standard practice includes the full services of public finance counsel. As Bond
Counsel, this includes: (i) assisting the City and its financial advisor, as appropriate, in reviewing and
analyzing legal issues relating to the structure of the bond issue, implementing the goals of the financing,
explaining the details of the financings and guiding the City through these requirements; (ii) drafting the
authorizing resolutions and all legal documents necessary in connection with the issuance of the bonds,
including all necessary tax due diligence in order to initiate our tax analysis; (iii) assisting in the
preparation and review of the offering memorandum; (iv) assistance in the review of documents typically
prepared by Underwriter's Counsel, such as the bond purchase agreement; (v) rendering our usual Bond
Counsel opinions relating to the validity of the bonds,the tax-exempt status of the bonds, and the portions
of the preliminary official statement and official statement describing the bonds and the security for the
bonds (see also Disclosure Counsel practice below); (vi) preparation of a closing memorandum and
coordination for execution and delivery of all legal documents in connection with the closing of the bond
transaction, including the bond documents and other necessary certificates and opinions and items
requested by the underwriter, the rating agencies and the credit facility providers, as appropriate; and (v)
providing advice on typical post-closing matters.
As Disclosure Counsel responsible for preparing the official statement, we review all publicly
available information to ensure continuity in an issuer's disclosure materials and actively diligence
information relayed to us to ensure an accurate and complete disclosure document. We work to ensure
that the scope of disclosure comports with SEC standards. Further, the breadth and depth of our
experience permits us to review the City's offering document relative to those of similarly situated
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entities in the market and advise on topics and issues that may be of concern from a disclosure
perspective.
In this regard, we endeavor to prepare initial drafts of documents (including the Preliminary
Official Statement) that include the various topics and questions that we expect to be of interest and/or
concern to the City and to potential bondholders. Our experience is that comprehensive initial drafts can
help to shorten financing schedules and inform the group as to the universe of concerns to be considered.
We would then expect to review the documents with financing team and distribute revised documents in a
timely manner to accommodate multiple review sessions prior to release of the draft documents to rating
agencies. We would continue to update the documents for posting and simultaneously prepare closing
documents and related materials so that minimal tum-around time is required upon pricing. After pricing,
we would distribute revised documents for review and sign-off, at which point we would coordinate
execution.
111. Data Request
To facilitate the preparation of financing documents and ensure the proper prepayment and
defeasance of the outstanding 2003 Certificates, we would seek to review a copy of the transcript for the
outstanding 2003 Certificates and the transcript of the 1993 Certificates that were refunded thereby. We
would also seek to review the amounts of unspent proceeds of the prior certificates and review any tax-
related matters arising after their respective execution dates.
For diligence purposes, we will review the City's existing disclosure materials with a view to
bring it current with existing disclosure requirements and market standards, which may in certain
circumstances warrant consideration of additional sections (e.g., a management's analysis and discussion)
and the expansion of certain disclosure (e.g., regulatory requirements, pension and post-employment
benefits). Certain of such information may be gleaned from existing reports (e.g., actuarial reports and
existing audits) and certain other information will require the attention of specific officials with
knowledge of and/or access to the relevant material (e.g., the enterprise fund's portion of City liabilities,
their respective trajectories and their expected effects on rates and the funds' balances).
IV. Scope Exclusions/Addenda
We are prepared to dedicate the time and resources necessary to accommodate the City's
schedule and we are confident of our ability to provide these legal services at competitive rates. We have
no exclusions to note.
V. Deliverables
The actual deliverables will depend on the manner in which the City elects to structure its
refinancing and the requirements of the Trust Agreements governing the outstanding 2003 Certificates.
As a general matter, we would expect to deliver the following:
1. Trust Agreement
2. . Installment Agreement
3. Continuing Disclosure Agreement
4. Escrow Agreement
5. Tax Certificate
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6. Authorizing resolution of issuing entity(if not the City)
7. Authorizing resolution of the City
8. Preliminary and Final Official Statement
9. Specimen Certificates
10. Various closing certificates, including Rule 15c2-12 Certificate
11. Approving Opinion
12. Supplemental Opinion
13. Disclosure Counsel Opinion
Vi. Schedule
Hawkins is available immediately to serve as Bond Counsel and Disclosure Counsel on the City's
certificates of participation financing. Each of the attorneys set forth in this Proposal is available to work
on the proposed financing throughout the course of the transaction. If the City elects a financing structure
substantially similar to that used in 2003 and electronic copies of such documents are available for
drafting purposes (i.e., no additional time is required for scanning and converting the 2003 documents),
we are prepared to begin reviewing the transcript for the outstanding 2003 Certificates with a view to
distribute initial drafts of documents within a week, during which time we will also be consulting with the
City as to various financing preferences and debt policy requirements. We are also committed to revising
and distributing documents in a timely manner so as to complete the financing on the City's schedule.
We have worked on similarly short schedules for other issuers and are confident in our ability to do so in
the present case.
VII. Lump Sum Not-To-Exceed Fee
It is customary for the Firm to agree with our clients as to the fees applicable both to each type of
issue or service for which the Firm is retained and for general advice by the Firm. We are confident of
our ability to work for the City at competitive rates.
We respectfully propose the following fixed fees for the services described in the Request:
Proposed Financing Proposed Fixed Fee
Bond and Disclosure Counsel* services in connection with
the Series A Certificates of Participation refunding............... $43,000
Bond and Disclosure Counsel' services in connection with
the Series B Certificates of Participation refunding................ 520,000
Bond Counsel services in connection with the Series B
Certificates of Participation refunding(private placement)..:. $15,000
' Preparation of the City's continuing disclosure undertaking, whether in the forth of a certificate or
agreement,is included as part of Disclosure Counsel services.
In addition,the Firm would seek reimbursements for out-of-pocket costs and expenses, subject to
prior approval by the City. In addition, the Firm would seek reimbursements for actual out-of-pocket
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027
costs and expenses approved by the City, including copying, couriers and postage in an amount not to
exceed $2,000 plus the cost of producing transcripts. The payment of any fees and expenses would be
contingent upon the successful closing of the transaction.
We are prepared to dedicate the time and resources necessary to accommodate the City's
schedule and we are confident of our ability to provide these legal services at competitive rates. We hope
that if this proposal is not fully satisfactory, the City will apprise us of its concerns and allow us an
opportunity to address those issues. We are prepared to consider any other arrangement satisfactory to
the City.
VIII. Fee Schedule/Hourly Rates
Alternatively, if the City would prefer, we would be pleased to bill for Bond and Disclosure
Counsel services at our standard hourly rates, discounted by 15%. The current hourly rate for Ms. Quan,
Mr. Pirog, Mr. Miller and Mr. Ogbu are $575, $650, $650 and 5415, respectively. In addition, the Firm
would seek reimbursements for actual out-of-pocket costs and expenses approved by the City, including
copying, couriers and postage in an amount not to exceed $2,000 plus the cost of producing transcripts.
The payment of any fees and expenses would be contingent upon the successful closing of the transaction.
In light of our depth and breadth of experience and highly qualified, seasoned attorneys,Hawkins
proposes very competitive rates. Our expertise and experience affords us the opportunity to perform at
high levels of legal standards, deliver quality services at reasonable prices. We do not staff deals with
more lawyers than necessary and are proud of our record of delivering cost effective legal services.
IX. Other Client Commitments
Hawkins hereby attests to the availability of the key personnel set forth in this Proposal to fulfill
the obligations of the proposed engagement in a professional and timey manner. We adjust our schedules
to make partners of the firm available for meetings, conferences calls and closings as requested by clients.
We are prepared to dedicate the time and resources necessary to accommodate the City's schedule and we
are confident of our ability to provide these legal services at competitive rates.
X. Other
An integral part of our Bond Counsel services is the expertise of our Tax Department. Following
is a description of our tax counsel services and IRS tax compliance audit work.
Tax Counsel Services. Hawkins has one of the municipal industry's largest and most
experienced tax departments devoted primarily to public finance, consisting of seven partners and a
number of tax associates and financial analysts. In particular, the tax attorneys in our.San Francisco
office have significant experience providing advice on complex tax matters relating to California bond
issues and refunding. Hawkins' active tax practice deals with specialized and technical federal, state and
local tax issues arising in connection with the Firm's public finance and project finance practices. In
addition to reviewing financing transactions for compliance with the tax laws,our tax department actively
participates in the development of new financing structures and programs. Some of the issues arising in
our tax practice include disclosure questions relating to the offering of specialized debt instruments, the
qualification of programs for tax-exempt financing, the investment and expenditure of bond proceeds,
permitted uses of bond-financed projects, post-closing disposition of bond-financed property and
compliance with the arbitrage rebate requirements. Because we have done and continue to do so many
transactions throughout the State and the country,we have been exposed to a wide variety of tax issues.
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As Tax Counsel, we provide advice regarding the exclusion of interest from gross income for
Federal tax purposes and the State exemption for such interest with respect to the obligations issued. In
rendering this advice we review all relevant aspects of a transaction to ensure that the structure,
representations, covenants and other matters appropriately support our tax advice and conclusions. We
also draft any tax certificate or agreements required by the financing and prepare and submit to the
Internal Revenue Service (the "IRS") any applicable tax forms, As Tax Counsel, we also support the
Firm's clients by providing rebate and escrow management services through our financial services
department.
Further,our tax department closely monitors and actively participates in the federal tax legislative
and regulatory process. We participate proactively in the tax regulatory public comment process and
often provide extensive written comments on proposed regulations. The Firm has obtained numerous
private letter rulings on federal tax issues on behalf of its clients. Our financial services department,
consisting of analysts and computer programmers, works in collaboration with the Firm's tax department
to provide our clients with an in-house financial analysis capability that is rarely matched by other firms.
IRS Tax.Compliance Audit Services. Hawkins has successfully represented numerous issuers
before the IRS in connection with audits and voluntary settlements, as well as in connection with self-
correcting remedial actions.
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APPENDIX A
HAWKINS DELAFIELD&WOOD LLP
CALIFORNIA WATER AND WASTEWATER FINANCINGS
2007-2011
DATE AMOUNT($) ISSUER ISSUE ROLE
1/30/2007 57,000,000 City of San Diego Public Facilities Financing Authority Non-Transferable Subordinated Water Revenue Notes,Series 2007A BC
2/27/2007 78,780,000 Santa Clara Valley Water District Refunding and Improvement Certificates of Participation, Series UC
2007A
3/1/2007 89,915,000 County of Sacramento Sanitation Districts Financing Authority Refunding Revenue Bonds,Series 2007 A(Fixed Rate) DC
3/l/2007 353,450,000 County of Sacramento Sanitation Districts Financing Authority Refunding Revenue Bonds, Series 2007 B(Index Rate) DC
3/29/2007 134,515,000 County of Los Angeles Sanitation Districts Financing Authority Capital Projects Revenue Bonds, 2007 Series A (District No. 20 UC
Subordinate Revenue Bonds)
7/18/2007 60,200,000 Rancho California Water District Financing Authority Revenue Bonds,Series of 2002 A(Remarketing) UC
11/6/2007 53,695,000 City of Roseville Water Utility Revenue Certificates of Participation Series 2007 UC
11/28/2007 27,345,000 City of Watsonville Water Revenue Bonds Series 2007 BC
1/3/2008 4,660,000 California Statewide Communities Development Authority Wastewater Revenue Bonds Series 2007A, City of Anderson and City BC/DC
of Lakeport
2/28/2008 150,000,000 City of San Diego Public Facilities Financing Authority Subordinated Water Revenue Notes Series 2008A DC
A-1
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DATE AMOUNT($) ISSUER ISSUE ROLE
3/27/2008 2,511,170 City of Calistoga 2008 Certificates of Participation(USDA Water Loan) BC
4/2/2008 159,580,000 Rancho California Water District Financing Authority Fixed Rate Refunding Revenue Bonds Series of 2008A UC
4/2/2008 44,625,000 Rancho California Water District Financing Authority Adjustable Rate Refunding Revenue Bonds Series of 20088 UC
5/1/2008 444,600,000 City of Los Angeles Wastewater System Subordinate Revenue Bonds, Variable Rate DC
Refunding Series 2008 -
5/13/2008 60,300,000 City of Riverside Variable Rate Refunding Water Revenue Bonds Issue of 2008A UC
5/28/2008 58,235,000 City of Riverside Water Revenue Bonds Issue of 2008B(Fixed Rate) UC
6/12/2008 88,800,000 Metropolitan Water District of Southern California Water Revenue Bonds, 2000 Authorization, Series B-2 (Replacement BC
of Liquidity Facility)
7/1/2008 133,430,000 Metropolitan Water District of Southern California Revenue Refunding Bonds 2008 Series B BC
12/10/2008 176,115,000 County of Orange Sanitation District Refunding Certificates of Participation, Series 2008C (Certificate UC
Anticipation Notes)
1/27/2009 200,000,000 Metropolitan Water District of Southern California Water Revenue Bonds,2008 Authorization,Series A BC
1/29/2009 157,190,000 City of San Diego Public Facilities Financing Authority Water Revenue Bonds, Refunding Series 2009A DC
1/29/2009 21,420,000 San Jose-Santa Clara Clean Water Financing Authority Sewer Revenue Refunding Bonds,Series 2009A UC
A-2
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DATE AMOUNT($) ISSUER ISSUE ROLE
3/26/2009 454,785,000 City of Los Angeles Wastewater System Revenue Bonds, Refunding Series 2009-A DC
5/13/2009 453,775,000 City of San Diego Public Facilities Financing Authority Senior Sewer Revenue Bonds, Series 2009A (Payable Solely From DC
Installment Payments Secured by Wastewater System Net Revenues)
6/9/2009 634,940,000 City of San Diego Public Facilities Financing Authority Senior Sewer Revenue Refunding Bonds, Series 2009B (Payable DC
Solely From Installment Payments Secured by Wastewater System Net
Revenues)
6/26/2009 328,060,000 City of San Diego Public Facilities Financing Authority Water Revenue Bonds, Series 20098 (Payable Solely From Installment BC
Payments Secured by Net System Revenues of the Water Utility Fund)
6/30/2009 54,775,000 City of Tulare Sewer Revenue Bonds, Series 2009 (Taxable Build America Bonds - BC
Direct Pay)
8/11/2009 81,065,000 Metropolitan Water District of Southern California Water Revenue Refunding Bonds, 2009 Series D (Tax-Exempt BC
Refunding Bonds)
8/11/2009 250,000,000 Metropolitan Water District of Southern California Water Revenue Bonds, 2008 Authorization, Series D (Taxable Build BC
America Bonds)
8/12/2009 31,625,000 Western Riverside Water and Wastewater Financing Authority Revenue Bonds, Series 2009 (Eastern Municipal Water District UC
Improvement Districts General Obligation Bond Financing)
8/18/2009 20,000,000 Indian Wells Valley Water District Water Revenue Certificates of Participation, Series 2009 (Bank BC
Qualified)
8/20/2009 36,835,000 City of Riverside Sewer Revenue Bonds,Series 2009A UC
8/20/2009 204,075,000 City of Riverside Sewer Revenue Bonds, Series 2009B Taxable(Build America Bonds- UC
Direct Payment to Issuer)
12/10/2009 26,050,000 Metropolitan Water District of Southern California Water Revenue Refunding Bonds,2009 Series E BC
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DATE AMOUNT($) ISSUER ISSUE ROLE
12/22/2009 45,515,000 Metropolitan Water District of Southern California Waterworks General Obligation Refunding Bonds,2009 Series A BC
12/22/2009 15,465,000 United Water Conservation District Certificates of Participation,Series 2009 BC
4/21/2010 6,385,000 West Valley Sanitation District Sewer Revenue Refunding Bonds,Series 2010 BC
8/25/2010 139,775,000 City of Los Angeles Department of Water and Power, Power System Revenue Bonds 2010 UC
Series C(Federally Taxable)
10/14/2010 24,990,000 Imperial Irrigation District Water System Refunding Revenue Bonds,2010 Series UC
10/21/2010 177,420,000 City of Los Angeles Wastewater System Revenue Bonds Series 2010-A (Taxable Build DC
America Bonds)
10/21/2010 96,000,000 City of Los Angeles Wastewater System Revenue Bonds Series 2010-B (Taxable Recovery DC
Zone Economic Development Bonds)
10/21/2010 199,790,000 City of Los Angeles Wastewater System Subordinate Revenue Bonds Series 2010-A (Tax- DC
Exempt)
11/3/2010 100,785,000 Rancho California Water District Financing Authority Fixed Rate Revenue Bonds, Series 2010A (Federally Taxable Direct UC
Pay Build America Bonds)
I1/10/2010 8,795,000 City of Burbank Burbank Water and Power Water Revenue Refunding Bonds, Series UC
2010A
11/10/2010 27,945,000 City of Burbank Burbank Water and Power Water Revenue Bonds, Series 2010B UC
(Taxable Build America Bonds)
12/22/2010 250,000,000 Metropolitan Water District of Southern California Water Revenue Bonds 2010 Authorization, Series A (Taxable Build BC
America Bonds)
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DATE AMOUNT(S) ISSUER ISSUE ROLE
12/23/2010 19,425,000 City of Tulare Sewer Revenue Bonds, Series 2010 BC
3/2/2011 38,395,000 City of Pittsburg Public Financing Authority Water Revenue Refunding Bonds,Series 2008 BKC
3/23/2011 44,625,000 Rancho California Water District Financing Authority Adjustable Rate Refunding Revenue Bonds Series of 20088 UC
(Remarketing)
5/26/2011 59,000,000 City of Riverside Variable Rate Refunding Water Revenue Bonds, Issue of 2011A BC
(Index Interest Rate Period)
7/26/2011 12,925,000 Imperial Irrigation District Water System Refunding Revenue Bonds,2011 Series UC
11/82011 9,870,000 Rancho California Water District Financing Authority Fixed Rate Revenue Bonds, Series 2011A (Qualified Energy UC
Conservation Bonds)
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APPENDIX B
HAWKINS DELAFIELD&WOOD LLP
CALIFORNIA POWER/ELECTRIC FINANCINGS
2007-2011
DATE AMOUNT($) ISSUER ISSUE ROLE
3/20/2008 1,006,510,000 State of California Department of Water Resources Power Supply Revenue Bonds,Series 2008H BC
4/2/2008 150,000,000 State of California Department of Water Resources Power Supply Revenue Bonds,Series 20081 BC
4/17/2008 330,000,000 State of California Department of Water Resources Power Supply Revenue Bonds,Series 20087 BC
5/1/2008 84,515,000 City of Riverside Variable Rate Refunding Electric Revenue Bonds Issue of 2008A UC
5/1/2008 57,275,000 City of Riverside Variable Rate Refunding Electric Revenue Bonds Issue of 20088 UC
5/1/2008 57,325,000 City of Riverside Variable Rate Refunding Electric Revenue Bonds Issue of 2008C UC
5/8/2008 279,250,000 State of California Department of Water Resources Power Supply Revenue Bonds,Series 2008K BC
5/20/2008 209,740,000 City of Riverside Electric Revenue Bonds Issue of 2008D(Fixed Rate) UC
6/19/2008 196,970,000 California Infrastructure and Economic Development Bank Revenue Bonds (California Independent System Operator Corporation BC
Project)2008 Series A
8/7/2008 250,000,000 Imperial Irrigation District Electric System Refunding Revenue Bonds,Series 2008A UC
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DATE AMOUNT($) ISSUER ISSUE ROLE
1/15/2009 149,570,000 State of California Department of Water Resources Power Supply Revenue Bonds (Fixed Rate) Series 2005 F-3 BC
(Remarketing)
1/15/2009 198,560,000 State of Califomia Department of Water Resources Power Supply Revenue Bonds (Fixed Rate) Series 2005 F-5 BC
(Remarketing)
3/10/2009 70,000,000 City of Anaheim Public Financing Authority Revenue Bonds, Series 2009-A (City of Anaheim Electric and Power UC
System Distribution Facilities)
5/12/2010 2,992,540,000 State of California Department of Water Resources Power Supply Revenue Bonds, Series 2010L BC
10/13/2010 19,940,000 Trinity County Public Utilities District Financing Authority 2010 Electric Revenue Bonds,Series A UC
10/20/2010 1,763,215,000 State of California Department of Water Resources Power Supply Revenue Bonds,Series 2010M BC
12/16/2010 133,290,000 City of Riverside Electric Revenue Bonds, Issue of 2010A (Federally Taxable Build BC
America Bonds-Direct Payment)
12/16/2010 7,090,000 City of Riverside Electric Revenue Bonds, Issue of 2010E(Tax Exempt;Bank Qualified) BC
2/24/2011 78,065,000 Imperial Irrigation District Electric System Refunding Revenue Bonds,Series 2011A UC
4/28/2011 56,450,000 City of Riverside Variable Rate Refunding Electric Revenue Bonds,Issue of 2011A BC
6/16/2011 75,485,000 Imperial Irrigation District Electric System Refunding Revenue Bonds,Series 2011 B UC
8/4/2011 75,745,000 Imperial Irrigation District Electric System Refunding Revenue Bonds, Series 2011 C UC
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F7:
DATE AMOUNT($) ISSUER ISSUE ROLE
8/31/2011 959,565,000 State of California Department of Water Resources Power Supply Revenue Bonds,Series 201 IN BC
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APPENDIX C
HAWKINS DELAFIELD&WOOD LLP
CALIFORNIA LEASE REVENUE BONDS AND CERTIFICATES OF PARTICIPATION
2007-2011
DATE AMOUNT($) ISSUER ISSUE ROLE
2/7/2007 99,860,000 County of Solano 2007 Refunding Certificates of Participation DC
2/15/2007 40,540,000 County of Stanislaus Refunding Certificates of Participation Series A of 2007 DC
3/12/2007 156,560,000 City of San Diego Public Facilities Financing Authority Lease Revenue Refunding Bonds, Series 2007A(Ballpark Refunding) DC
3/13/2007 89,270,000 California State Public Works Board Lease Revenue Bonds(Office of Emergency Services)2007 Series A(Los BC
Angeles Regional Crime Laboratory)
3/29/2007 59,475,000 City of Riverside (ARS MODE)Certificates of Participation 2007 Series A(Various Capital UC
Improvement Projects)
3/29/2007 59,500,000 City of Riverside (ARS MODE)Certificates of Participation 2007 Series B(Various Capital UC
Improvement Projects)
4/16/2007 55,350,000 County of Fresno Lease Revenue Bonds,Series 2007(Shared Use Juvenile Court Project) BC/DC
4/19/2007 17,400,000 City of San Mateo Variable Rate Demand Lease Revenue Bonds(Public Safety Project)Series UC
2007 A
8/15/2007 93,540,000 County of Santa Clara Financing Authority Lease Revenue Bonds(Multiple Facilities Projects)2007 Series K DC
10/4/2007 42,435,000 City and County of San Francisco Lease Revenue Bonds,Series 2007(Open Space Fund-Various Park BC
Projects)
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DATE AMOUNT (S) ISSUER ISSUE ROLE
2/14/2008 126,410,000 County of Santa Clara Financing Authority Lease Revenue Bonds(VMC Refunding)2008 Series A DC
4/16/2008 8,860,000 County of San Bernardino Certificates of Participation(2008 Refunding Program) Series A DC
4/16/2008 80,085,000 County of San Bernardino Certificates of Participation(2008 Refunding Program)Series B(Taxable) DC
4/17/2008 128,300,000 City of Riverside Variable Rate Refunding Certificates of Participation(Riverside UC
Renaissance Projects)Series 2008
5/1/2008 113,450,000 City of Oakland Oakland Joint Powers Financing Authority Lease Revenue Refunding Bonds BC
(Oakland Administration Buildings)2008 Series B
5/22/2008 112,840,000 County of Santa Clara Financing Authority Refunding Lease Revenue Bonds(Multiple Facilities Projects)2008 Series DC
L
5/29/2008 143,105,000 County of Santa Clara Financing Authority Variable Rate Demand Refunding Lease Revenue Bonds(Multiple Facilities DC
Projects)2008 Series M
6/24/2008 22,718,862 Merced Irrigation District 2008B Current Interest Refunding Revenue Certificates of Participation BC
(Water and Hydroelectric System Projects)
6/24/2008 6,335,000 Merced Irrigation District 2008A Current Interest Refunding Revenue Certificates of Participation BC
(Water and Hydroelectric System Projects)
8/1/2008 43,790,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Bonds Series 2008-B(Real Property) UC
of Los Angeles)
8/1/2008 105,090,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Bonds Series 2008-A(Capital Equipment) UC
of Los Angeles)
9/17/2008 28,800,000 City of Pasadena Taxable Variable Rate Demand Lease Revenue Refunding Bonds-Pasadena UC
Public Financing Authority(Paseo Colorado Parking Facilities)Series 2008
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DATE AMOUNT ($) ISSUER ISSUE ROLE
12/10/2008 78,895,000 County of Riverside Variable Rate Demand Leasehold Revenue Refunding Bonds Series 2008A UC
(Southwest Justice Center Refunding)
2/26/2009 136,885,000 County of San Diego Lease Revenue Bonds(County Operations Center and Annex UC
Redevelopment Project)Series 2009A
3/19/2009 103,000,000 City of San Diego Public Facilities Financing Authority Lease Revenue Bonds,Series 2009A(Various Capital Improvement BC
Projects)
5/27/2009 163,335,000 City and County of San Francisco Certificates of Participation,Series 2009A(Multi Capital Improvement BC
Projects)
9/17/2009 37,885,000 City and County of San Francisco Certificates of Participation,Series 2009B(Multiple Capital Improvement UC
Projects)
10/14/2009 80,940,000 County of San Diego Certificates of Participation(Justice Facilities Refunding) UC
12/1/2009 16,745,000 County of Solano Refunding Certificates of Participation, Series 2009 UC
12/22/2009 300,000,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Commercial Paper Notes BC
of Los Angeles)
12/22/2009 100,000,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Commercial Paper Notes BC
of Los Angeles)
12/22/2009 200,000,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Commercial Paper Notes BC
of Los Angeles)
2/18/2010 50,110,000 County of Santa Clara Financing Authority Refunding Lease Revenue Bonds(Multiple Facilities Projects)2010 Series DC
N
4/7/2010 3,215,000 County of Los Angeles Office of Education Certificates of Participation(Los Angeles County Schools Pooled Financing BC
Program)2010 Refunding Series A(Montebello Unified School District)
C-3
D
O
DATE AMOUNT ($) ISSUER ISSUE ROLE
4/7/2010 13,945,000 County of Los Angeles Office of Education Certificates of Participation(Los Angeles County Schools Pooled Financing BC
Program)2010 Refunding Series A(Santa Monica Community College
District)
6/10/2010 50,000,000 City and County of San Francisco Taxable and Tax-Exempt Lease Revenue Commercial Paper Certificates of BKC
Participation,Series 2 and 2-T
6/10/2010 50,000,000 City and County of San Francisco Taxable and Tax-Exempt Lease Revenue Commercial Paper Certificates of BKC
Participation,Series 1 and 1-T
6/302010 10,000,000 County of Los Angeles Office of Education Certificates of Participation(Antelope Valley Community College District) BC
2010 Series C(Bank Qualified)
9/30/2010 138,445,000 City and County of San Francisco Refunding Certificates of Participation Series 2010A BC
11/23/2010 688,005,000 County of Los Angeles Public Works Financing Authority Lease Revenue Bonds(Multiple Capital Projects I),2010 Series B(Build UC
America Bonds/Recovery Zone Economic Development Bonds)
11/23/2010 102,900,000 County of Los Angeles Public Works Financing Authority Lease Revenue Bonds(Multiple Capital Projects I),2010 Series A(Tax- UC
Exempt)
11/30/2010 20,085,000 City of Newport Beach Certificates of Participation 2010A(Tax-Exempt)(Civic Center DC
Project/Central Library Refunding)
11/30/2010 106,575,000 City of Newport Beach Certificates of Participation 2010B(Federally Taxable Direct Pay Build DC
America Bonds)(Civic Center Project)
12/16/2010 15,000,000 City of Fremont Variable Rate Demand Certificates of Participation(2010 Financing Project) BKC
12/21/2010 21,615,000 Los Angeles Unified School District Certificates of Participation 2010 Series B-1 (Federally Taxable Direct Pay BC/DC
Build America Bonds)(Capital Projects 1)
12/21/2010 61,730,000 Los Angeles Unified School District Certificates of Participation 2010 Series B-2(Tax-Exempt)(Capital Projects BC/DC
I)
C-4
O
DATE AMOUNT ($) ISSUER ISSUE ROLE
1/27/2011 124,605,000 City of Upland Certificates of Participation(San Antonio Community Hospital) UC
2/24/2011 130,000,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Commercial Paper Notes,Tax-Exempt Series A-1 and BC
of Los Angeles) Taxable Series B-1
2/24/2011 40,000,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Commercial Paper Notes,Tax-Exempt Series A-3 and BC
of Los Angeles) Taxable Series B-3
2/24/2011 130,000,000 City of Los Angeles(Municipal Improvement Corporation Lease Revenue Commercial Paper Notes,Tax-Exempt Series A-2 and BC
of Los Angeles) Taxable Series B-2
5/3/2011 19,260,000 County of San Diego Certificates of Participation(2011 MTS Tower Refunding) UC
5/18/2011 14,725,000 City and County of San Francisco Lease Revenue Bonds,Series 2011A(Equipment Program)(Remarketing) DC
8/1/2011 32,665,000 County of San Diego Certificates of Participation(County Administration Center Waterfront UC
Park)
11/4/2011 5,325,000 County of Shasta 2011 Courthouse Lease BC
11/17/2011 23,105,000 City and County of San Francisco Refunding COPS(Moscone Center South Refunding Project)Series 2011A DC
11/17/2011 63,375,000 City and County of San Francisco Refunding COPS(Moscone Center North Refunding Project)Series 201 IB DC
C-5
O
iV
APPENDIX D
HAWKINS DELAFIELD a&WOOD LLP
CALIFORNIA REFUNDINGS
2007-11
DATE AMOUNT($) ISSUER ISSUE ROLE TYPE
1/11/2007 18,024,000 City of Los Angeles Housing Authority Multifamily Housing Revenue and Refunding BC Multifamily Housing
Notes Series 2007
1/31/2007 1,153,195,000 Los Angeles Unified School District 2007 General Obligation Refunding Bonds BC General
Series A-1 Obligation/Education
1/31/2007 136,055,000 Los Angeles Unified School District 2007 General Obligation Refunding Bonds BC General
Series A-2 Obligation/Education
2/6/2007 2,800,000 South Bay Regional Public Communications Authority Refunding Revenue Bonds, 2007 Series A DC Infrastructure
(City of Gardena Project)
2/7/2007 99,860,000 County of Solano 2007 Refunding Certificates of Participation DC Infrastructure
2/15/2007 40,540,000 County of Stanislaus Refunding Certificates of Participation Series A DC Infrastructure
of 2007
2/22/2007 24,845,000 Los Angeles Unified School District General Obligation Refunding Bonds, 2007 BC General
Series B Obligation/Education
2/27/2007 78,780,000 Santa Clara Valley Water District Refunding and Improvement Certificates of UC Water
Participation,Series 2007A
3/1/2007 89,915,000 County of Sacramento Sanitation Districts Financing Authority Refunding Revenue Bonds, Series 2007 A DC Wastewater
(Fixed Rate)
3/1/2007 353,450,000 County of Sacramento Sanitation Districts Financing Authority Refunding Revenue Bonds, Series 2007 B DC Wastewater
(Index Rate)
D-I
O
.L1
e.d%
DATE AMOUNT($) ISSUER ISSUE ROLE TYPE
3/12/2007 156,560,000 City of San Diego Public Facilities Financing Authority Lease Revenue Refunding Bonds, Series DC Infrastructure
2007A(Ballpark Refunding)
3/21/2007 46,800,000 Val Verde Unified School District Auction Rate Certificates of Participation UC Education
(Refunding Project),2007 Series B
5/3/2007 6,169,991 Mt. Pleasant Elementary School District General Obligation Refunding Bonds, 1998 UC General
Election,2007 Series E Obligation/Education
5/29/2007 23,845,000 County of San Bernardino Flood Control District Refunding Bonds,Series 2007 DC Judgment Obligation
6/21/2007 11,345,000 City of Los Angeles Community Redevelopment Agency Grand Central Square Multi-Family Housing BC Multifamily Housing
Revenue Refunding Bonds (CRALA), Series
2007 A
6/21/2007 8,615,000 City of Los Angeles Community Redevelopment Agency Grand Central Square Multi-Family Housing BC Multifamily Housing
Revenue Refunding Bonds (LACMTA), Series
2007 B
7/5/2007 94,315,000 County of Los Angeles Public Works Financing Authority Refunding Revenue Bonds Series 2007A (Los UC Assessment
Angeles County Regional Park and Open Space
District)
7/5/2007 9,515,000 California Infrastructure and Economic Development Bank Revenue Refunding Bonds(Brentwood School) UC 501(c)(3)/Education
Series 2007A
7/5/2007 4,385,000 California Infrastructure and Economic Development Bank Revenue Refunding Bonds(Brentwood School) UC 501(c)(3)/Education
Series 20078
7/25/2007 20,660,000 City of Los Angeles Housing Authority Multifamily Housing Refunding Revenue BC Multifamily Housing
Bonds,2007 Series A
11/6/2007 998,685,000 State of California General Obligation Refunding Bonds UC General Obligation
2/14/2008 126,4105000 County of Santa Clara Financing Authority Lease Revenue Bonds (VMC Refunding) 2008 DC Infrastructure
Series A
D-2
O
4b
.A
DATE AMOUNT(S) ISSUER ISSUE ROLE TYPE
3/13/2008 94,420,000 California Municipal Finance Authority Refunding Revenue Bonds (Biota University) BC 501(c)(3)/Education
Series 2008A(Tax-Exempt)
3/13/2008 6,485,000 California Municipal Finance Authority Refunding Revenue Bonds (Biola University) BC 501(c)(3)/Education
Series 2008B(Taxable)
3/26/2008 26,125,000 California State Public Works Board Lease Revenue Refunding Bonds (The Regents UC 501(c)(3)/Education
of the University of California) 2008 Series B
(UC San Francisco Moffitt and Long Hospital
3/26/2008 14,835,000 California State Public Works Board Lease Revenue Refunding Bonds(The Regents UC 501(c)(3)/Education
of the University of California) 2008 Series C
(Natural Sciences Unit 2 - McGaugh Hall
3/26/2008 261,610,000 California State Public Works Board Lease Revenue Refunding Bonds(The Regents UC 501(c)(3)/Education
of the University of California) 2008 Series A
(UC Irvine Medical Center Replacement
3/27/2008 79,170,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 34C
3/27/2008 81,170,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 34D
3/27/2008 299,365,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 34E
3/27/2008 16,645,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 34F
4/2/2008 159,580,000 Rancho California Water District Financing Authority Fixed Rate Refunding Revenue Bonds Series of UC Water
2008A
4/2/2008 44,625,000 Rancho California Water District Financing Authority Adjustable Rate Refunding Revenue Bonds UC Water
Series of 2008B
4/9/2008 92,500,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 34A
D-3
O
.A
Lo
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
4/9/2008 82,500,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 34B -
4/16/2008 37,295,000 County of San Bernardino Flood Control District Judgment Obligation Refunding Bonds Series DC Judgment Obligation
2008
4/16/2008 8,860,000 County of San Bernardino Certificates of Participation (2008 Refunding DC Infrastructure
Program)Series A
4/16/2008 80,085,000 County of San Bernardino Certificates of Participation (2008 Refunding DC Infrastructure
Program)Series B(Taxable)
4/16/2008 160,900,000 County of San Bernardino Pension Obligation Refunding Bonds Series DC Pension Obligation
2008
4/17/2008 128,300,000 City of Riverside Variable Rate Refunding Certificates of UC Infrastructure
Participation (Riverside Renaissance Projects)
Series 2008
4/29/2008 44,895,000 California Infrastructure and Economic Development Bank Variable Rate Demand Refunding Revenue BC 501(c)(3)
Bonds (Los Angeles County Museum of
Natural History Foundation)Series A
4/29/2008 44,895,000 California Infrastructure and Economic Development Bank Variable Rate Demand Refunding Revenue BC 501(c)(3)
Bonds (Los Angeles County Museum of
Natural History Foundation)Series B
5/1/2008 113,450,000 City of Oakland Oakland Joint Powers Financing Authority BC Infrastructure
Lease Revenue Refunding Bonds (Oakland
Administration Buildings)2008 Series B
5/1/2008 444,600,000 City of Los Angeles Wastewater System Subordinate Revenue DC Wastewater
Bonds,Variable Rate Refunding Series 2008
5/1/2008 84,515,000 City of Riverside Variable Rate Refunding Electric Revenue UC Electric
Bonds Issue of 2008A
5/1/2008 57,275,000 City of Riverside Variable Rate Refunding Electric Revenue UC Electric
Bonds Issue of 20088
D-4
C
.A
Q)
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
5/1/2008 57,325,000 City of Riverside Variable Rate Refunding Electric Revenue UC Electric
Bonds Issue of 2008C
5/7/2008 205,100,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 37A
5/7/2008 79,720,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 37B
5/8/2008 40,620,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 36B
5/8/2008 100,000,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 36A
5/12/2008 50,525,000 Val Verde Unified School District Variable Rate Demand Refunding Certificates UC Education
of Participation 2008 Series A
5/13/2008 60,300,000 City of Riverside Variable Rate Refunding Water Revenue UC Water
Bonds Issue of 2008A
5/15/2008 89,895,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 37C
5/20/2008 36,145,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 36C
5/20/2008 32,685,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 36D
5/20/2008 19,690,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 37D
5/22/2008 112,840,000 County of Santa Clara Financing Authority Refunding Lease Revenue Bonds (Multiple DC Infrastructure
Facilities Projects)2008 Series L
D-5
O
rA.
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
5/29/2008 143,105,000 County of Santa Clara Financing Authority Variable Rate Demand Refunding Lease DC Infrastructure
Revenue Bonds (Multiple Facilities Projects)
2008 Series M
6/24/2008 128,745,000 County of Los Angeles Metropolitan Transportation Authority Proposition C Sales Tax Revenue Refunding BC Transportation
Bonds Second Senior Bonds,Series 2008-A
6/24/2008 6,335,000 Merced Irrigation District 2008A Current Interest Refunding Revenue BC Water/Infrastructure
Certificates of Participation (Water and
Hydroelectric System Projects)
6/24/2008 22,718,862 Merced Irrigation District 2008B Current Interest Refunding Revenue BC Water/Infrastructure
Certificates of Participation (Water and
Hydroelectric System Projects)
7/1/2008 133,430,000 Metropolitan Water District of Southern California Revenue Refunding Bonds 2008 Series B BC Water
7/30/2008 118,130,000 City and County of San Francisco General Obligation Refunding Bonds (Laguna BC 501(c)(3)/General
Honda Hospital)Series 2008-R3 Obligation/Healthcare
8/6/2008 97,530,000 Los Angeles Unified School District Variable Rate Refunding Certificates of DC Education
Participation, 2008 Series A (Administrative
Building Project)
8/6/2008 23,420,000 Los Angeles Unified School District Variable Rate Refunding Certificates of DC Education
Participation, 2008 Series B (Administrative
Building Project III)
8/7/2008 343,515,000 County of San Diego Pension Obligation Bonds Series 2008A UC Pension Obligation
(Taxable) [Refunding]
8/7/2008 50,000,000 County of San Diego Pension Obligation Bonds Series 2008B-I UC Pension Obligation
(Taxable) (Variable Rate Demand Obligations)
[Refunding]
8/7/2008 50,000,000 County of San Diego Pension Obligation Bonds Series 20088-2 UC Pension Obligation
(Taxable) (Variable Rate Demand Obligations)
[Refunding]
8/7/2008 250,000,000 Imperial Irrigation District Electric System Refunding Revenue Bonds, UC Electric
Series 2008A
D-6
O
.L�
00
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
9/10/2008 100,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (Los Angeles BC 501(c)(3)
County Museum of Art Project) (Variable Rate
Demand Obligations)Series 2008A
9/10/2008 100,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (Los Angeles BC 501(c)(3)
County Museum of Art Project) (Variable Rate
Demand Obligations)Series 2008B
9/10/2008 95,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (Los Angeles BC 501(c)(3)
County Museum of Art Project) (Variable Rate
Demand Obligations)Series 2008C
9/10/2008 60,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (Los Angeles BC 501(c)(3)
County Museum of Art Project) (Variable Rate
Demand Obligations)Series 2008D
9/10/2008 28,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (Los Angeles BC 501(c)(3)
County Museum of An Project) (Variable Rate
Demand Obligations)Series 2008E
9/17/2008 28,800,000 City of Pasadena Taxable Variable Rate Demand Lease Revenue UC Infrastructure
Refunding Bonds - Pasadena Public Financing
Authority (Paseo Colorado Parking Facilities)
9/18/2008 17,900,000 Rancho California Water District Financing Authority Community Facilities District No. 89-5 UC Water/Mello-Roos
(Rancon Business Center) Special Tax
Refunding Bonds,Series 1998(Reoffering)
10/23/2008 64,240,000 Olympic Club Taxable Variable Rate Demand Refunding UC 501(c)(3)
Bonds Series 2008
11/13/2008 35,000,000 California Infrastructure and Economic Development Bank Variable Rate Demand Refunding Revenue BC 501(c)(3)
Bonds (Academy of Motion Picture Arts and
Sciences Obligated Group)Series 2008
11/25/2008 34,000,000 ABAG Finance Authority for Nonprofit Corporations Variable Rate Refunding Revenue Bonds BC 501(c)(3)/Education
(Point Loma Nazarene University) Series 2008
12/10/2008 176,115,000 County of Orange Sanitation District Refunding Certificates of Participation, Series UC Wastewater
2008C(Certificate Anticipation Notes)
12/10/2008 78,895,000 County of Riverside Variable Rate Demand Leasehold Revenue UC Infrastructure
Refunding Bonds Series 2008A (Southwest
Justice Center Refunding)
D-7
O
rC.
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
1/29/2009 157,190,000 City of San Diego Public Facilities Financing Authority Water Revenue Bonds, Refunding Series DC Water
2009A
1/29/2009 21,420,000 San Jose-Santa Clara Clean Water Financing Authority Sewer Revenue Refunding Bonds, Series UC Wastewater
2009A
3/26/2009 454,785,000 . City of Los Angeles Wastewater System Revenue Bonds,Refunding DC Wastewater
Series 2009-A
6/2/2009 15,865,000 City of Sunnyvale Financing Authority Variable Rate Demand.Refunding Certificates UC Cash Flow
of Participation, Series 2009A (Government
Center Site Acquisition Project)
6/9/2009 634,940,000 City of San Diego Public Facilities Financing Authority Senior Sewer Revenue Refunding Bonds, DC Wastewater
Series 20098(Payable Solely From Installment
Payments Secured by Wastewater System Net
6/10/2009 29,240,000 Campbell Union High School District 2009 General Obligation Refunding Bonds UC General
Obligation/Education
6/30/2009 27,885,000 City of Los Angeles Housing Authority Mortgage Revenue Bonds (Property UC Multifamily Housing
Acquisition Refundings) 2009 Series A (Bank
Qualified)
8/4/2009 51,765,000 California Educational Facilities Authority Refunding Revenue Bonds (Stanford UC 501(c)(3)/Education
University)Series T-5
8/11/2009 81,065,000 Metropolitan Water District of Southern California Water Revenue Refunding Bonds, 2009 Series BC Water
D(Tax-Exempt Refunding Bonds)
9/3/2009 92,500,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds, Series
2009A(Non-AMT/Private Activity)
9/3/2009 82,500,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds, Series
20098(Non-AMT/Private Activity)
10/14/2009 80,940,000 County of San Diego Certificates of Participation (Justice Facilities UC Infrastructure
Refunding)
D-8
O
O
DATE AMOUNT (S) ISSUER ISSUE ROLE TYPE
10/15/2009 74,765,000 Los Angeles Unified School District General Obligation Refunding Bonds, 2009 BC/DC General
Series A(Tax-Exempt) Obligation/Education
10/22/2009 320,945,000 County of Los Angeles Metropolitan Transportation Authority Proposition A First Tier Senior Sales Tax UC Transportation
Revenue Refunding Bonds,Series 2009-A
11/3/2009 67,615,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds Series 2009C
(Non-AMT/Private Activity) Series 2009C-1
11/3/2009 65,300,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC. Transportation
Series Revenue Refunding Bonds Series 2009C
(Non-AMT/Private Activity) Series 2009C-2
11/4/2009 88,190,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds, Series
2009D(Non-AMT/Private Activity)
11/5/2009 2,935,615,000 State of California Economic Recovery Bonds Refunding Series UC Cash Flow
2009A
11/5/2009 500,000,000 State of California Economic Recovery Bonds Refunding Series UC Cash Flow
2009B
12/1/2009 16,745,000 County of Solana Refunding Certificates of Participation, Series UC Infrastructure
2009
12/8/2009 6,755,000 City of Long Beach Senior Airport Revenue Refunding Bonds, UC Transportation
Series 2009B
12/10/2009 26,050,000 Metropolitan Water District of Southern California Water Revenue Refunding Bonds, 2009 Series BC Water
E
12/22/2009 45,515,000 Metropolitan Water District of Southern California Waterworks General Obligation Refunding BC Water
Bonds,2009 Series A
2/4/2010 18,575,000 Marin Emergency Radio Authority . 2010 Refunding Revenue Bonds (Marin Public DC Infrastructure
Safety and Emergency Radio System)
D-9
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r+
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
2/4/2010 14,405,000 Napa Valley Unified School District 2010 General Obligation Refunding Bonds UC General
Obligation/Education
2/10/2010 86,375,000 City and County of San Francisco Airport Commission Second Series Variable Rate Revenue UC Transportation
Refunding Bonds Series 201OA-1
2/10/2010 57,595,000 City and County of San Francisco Airport Commission Second Series Variable Rate Revenue UC Transportation
Refunding Bonds Series 201 OA-2 .
2/10/2010 72,000,000 City and County of San Francisco Airport Commission Second Series Variable Rate Revenue UC Transportation
Refunding Bonds Series 201OA-3
2/18/2010 50,110,000 County of Santa Clara Financing Authority Refunding Lease Revenue Bonds (Multiple DC Infrastructure
Facilities Projects)2010 Series N
2/18/2010 4,985,000 Mendota Unified School District 2010 General Obligation Refunding Bonds UC General
Obligation/Education
3/4/2010 74,995,000 Los Angeles Unified School District General Obligation Refunding Bonds, Series A DC General
(20 10)(Tax-Exempt) Obligation/Education
3/24/2010 34,525,000 California Educational Facilities Authority Refunding Revenue Bonds (Carnegie UC 501(c)(3)/Education
Institution of Washington)2010 Series A
3/30/2010 38,500,000 California Educational Facilities Authority Variable Rate Refunding Revenue Bonds UC 501(c)(3)/Education
(Loyola Marymount University)Series 20108
4/7/2010 3,215,000 County of Los Angeles Office of Education Certificates of Participation (Los Angeles BC Education/Infrastrvctur
County Schools Pooled Financing Program) e
2010 Refunding Series A (Montebello Unified
4/7/2010 13,945,000 County of Los Angeles Office of Education Certificates of Participation (Los Angeles BC Education/Infrastruclur
County Schools Pooled Financing Program) e
2010 Refunding Series A (Santa Monica
4/7/2010 345,735,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds Series 2010C
(Non-AMT/Govemmental Purpose)
D-10
O
r1J
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
4/7/2010 89,860,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds Series 2010D
(Non-AMT/Private Activity)
4/7/2010 182,970,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds Series 2010E
(Taxable)
4/21/2010 6,385,000 West Valley Sanitation District Sewer Revenue Refunding Bonds,Series 2010 BC Wastewater
4/29/2010 54,055,000 City of San Jose Redevelopment Agency Merged Area Redevelopment Project Housing BC/DC Tax Allocation
Set-Aside Tax Allocation Bonds Tax-Exempt
Refunding Tax Allocation Bonds Series
4/29/2010 2,655,000 City of San Jose Redevelopment Agency Merged Area Redevelopment Project Housing BC/DC Tax Allocation
Set-Aside Tax Allocation Bonds Tax-Exempt
Refunding Tax Allocation Bonds Series
4/29/2010 10,695,000 City of San Jose Redevelopment Agency Merged Area Redevelopment Project Housing BC/DC Tax Allocation
Set-Aside Tax Allocation Bonds Taxable
Refunding Tax Allocation Bonds Series 2010B
7/29/2010 23,080,000 City of Roseville North Central Roseville Community Facilities UC Mello-Roos
District No. 1 Special Tax Refunding Bonds
Series 2010
9/15/2010 92,500,000 City and County of San Francisco Airport Commission Second Series Revenue Refunding Bonds UC Transportation
Series 2009F(Non-AMT/Private Activity)
9/30/2010 138,445,000 City and County of San Francisco Refunding Certificates of Participation Series BC Infrastructure
2010A
10/13/2010 39,485,000 Metropolitan Water District of Southern California Waterworks General Obligation Refunding BC General
Bonds,2010 Series A Obligation/Water
10/14/2010 24,990,000 Imperial Irrigation District Water System Refunding Revenue Bonds,2010 UC Water
Series
11/10/2010 89,790,000 California Infrastructure and Economic Development Bank Variable Rate Demand Refunding Revenue BC 501(c)(3)
Bonds (Los Angeles County Museum of
Natural Hisotry Foundation) Series 2008A and
D-ll
O
C3�
W
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
11/10/2010 8,795,000 City of Burbank Burbank Water and Power Water Revenue UC Water
Refunding Bonds,Series 2010A
11/30/2010 20,085,000 City of Newport Beach Certificates of Participation 2010A (Tax- DC Infrastructure
Exempt) (Civic Center Project/Central Library
Refunding)
12/16/2010 15,000,000 Escondido Union School District 2010 Taxable Health Insurance Obligation BKC Education
Refunding Bonds
12/22/2010 21,500,000 Countrydalc Metropolitan District Limited Tax (Convertible to Unlimited Tax) BKC General Obligation
General Obligation Refunding Senior Note
Series 2010A
2/1/2011 8,490,000 City of Santa Rosa Limited Obligation Refunding Improvement UC Assessment
Bonds, Fountaingrove Parkway Extension
Assessment District (Reassessment and
2/1/2011 3,405,000 City of Santa Rosa Limited Obligation Refunding Improvement UC Assessment
Bonds, Skyhawk Assessment District
(Reassessment and Refunding of 2011), Series
2/24/2011 78,065,000 Imperial Irrigation District Electric System Refunding Revenue Bonds, UC Electric
Series 2011A
3/2/2011 38,395,000 City of Pittsburg Public Financing Authority Water Revenue Refunding Bonds,Series 2008 BKC Water
3/23/2011 44,625,000 Rancho California Water District Financing Authority Adjustable Rate Refunding Revenue Bonds UC Water
Series of 2008B(Remarketing)
4/28/2011 56,450,000 City of Riverside Variable Rate Refunding Electric Revenue BC Electric
Bonds,Issue of 2011 A
5/3/2011 19,260,000 County of San Diego Certificates of Participation (2011 MTS Tower UC Infrastructure
Refunding)
5/19/2011 60,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (LACMA Project) BC 501(c)(3)
Series 2008D(Remarketing)
D-12
O
Ui
DATE AMOUNT($) ISSUER ISSUE ROLE TYPE
5/19/2011 28,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (LACMA BC 501(c)(3)
Project)Series 2008E(Remarketing)
5/19/2011 95,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (LACMA Project) BC 501(c)(3)
Series 2008C(Remarketing)
5/19/2011 100,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (LACMA BC 501(c)(3)
Project)(Variable Rate Demand Obligations)
Series 2008B(Remarketing)
5/19/2011 100,000,000 California Statewide Communities Development Authority Refunding Revenue Bonds (Variable Rate BC 501(c)(3)
Demand Obligations) (LACMA Project) Series
2008A(Remarketing)
5/26/2011 59,000,000 City of Riverside Variable Rate Refunding Water Revenue BC Water
Bonds, Issue of 2011A (Index Interest Rate
Period)
6/16/2011 75,485,000 Imperial Irrigation District Electric System Refunding Revenue Bonds, UC Electric
Series 201113
7/13/2011 36,145,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Variable Rate Revenue Refunding
Bonds Issue 36C (Non-AMT Private Activity
7/13/2011 89,895,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series . Variable Rate Revenue Refunding
Bonds Issue 37C (Non-AMT Private Activity
7/14/2011 11,995,000 City of Saratoga General Obligation Refunding Bonds, Series UC Infrastructure/General
2011 (Saratoga Community Library Project) . Obligation
7/19/2011 56,255,000 Eastern Municipal Water District Refunding Water and Sewer Revenue Bonds, UC Water/Wastewater
Series 2011 A
7/21/2011 163,720,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds, Series
2011 C(AMT)
7/21/2011 124,110,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds, Series
2011 D(Non-AMT/Govemmental Purpose)
D-13
O
Cit
CA
DATE AMOUNT ($) ISSUER ISSUE ROLE TYPE
7/21/2011 62,585,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds, Series
2011 E(Taxable)
7/26/2011 12,925,000 Imperial Irrigation District Water System Refunding Revenue Bonds,2011 UC Water
Series
8/4/2011 75,745,000 Imperial Irrigation District Electric System Refunding Revenue Bonds, UC Electric
Series 2011C
9/20/2011 123,325,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds Series 201 IF
(AMT)
9/20/2011 106,195,000 City and County of San Francisco Airport Commission San Francisca International Airport Second UC Transportation
Series Revenue Refunding Bonds Series 2011G
(Non-AMT/Governmental Purpose)
9/20/2011 125,055,000 City and County of San Francisco Airport Commission San Francisco International Airport Second UC Transportation
Series Revenue Refunding Bonds Series 201 IH
(Taxable)
9/28/2011 1,106,950,000 State of California Tax-Exempt General Obligation Refunding UC General Obligation
Bonds Bonds
10/20/2011 106,300,000 California Statewide Communities Development Authority Revenue and Refunding Bonds (Trinity Health BC Revenue Bonds
Credit Group)Series 2011 CA
11/1/2011 206,735,000 Los Angeles Unified School District 2011 General Obligation Refunding Bonds DC Education
Series A-1
11/1/2011 201,070,000 Los Angeles Unified School District 2011 General Obligation Refunding Bonds DC Education
Series A-2
11/15/2011 38,595,000 Contra Costa Community College District 2011 General Obligation Refunding Bonds UC General
Obligation/Education
11/17/2011 23,105,000 City and County of San Francisco Refunding COPS (Moscone Center South DC Infrastructure
Refunding Project)Series 2011A
D-14
U1
DATE AMOUNT (S) ISSUER ISSUE ROLE TYPE
11/17/2011 63,375,000 City and County of San Francisco Refunding COPS (Moscone Center North DC Infrastructure
Refunding Project)Series 2011 B
11/30/2011 339,475,000 City and County of San Francisco General Obligation Refunding Bonds Series DC General Obligation
2011-RI Bonds
12/20/2011 31,720,000 ABAG Finance Authority for Nonprofit Corporations Variable Rate Refunding Revenue Bonds BC 5010
(Point Loma Nazarene University)Series 2008
D-15
f
AZUSA
IIGMt t W<IEII
CONSENT CALENDAR
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE SA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES
DATE: FEBRUARY 27, 2012
SUBJECT: SELECTION OF UNDERWRITER TO REFUND WATER AND ELECTRIC
UTILITY LONG TERM DEBT
RECOMMENDATION
It is recommended that the Utility Board approve selection of De La Rosa & Co. to serve as
Underwriter to refund a portion of the long term debt issued by the water and electric utilities in
2003.
BACKGROUND
On January, 23, 2012, the Utility Board approved a scope of work for underwriter services and
authorized staff to solicit proposals to assist with refinancing a portion of the water and electric
utilities' outstanding debt issued in 2003. The request for proposals (RFP) was issued on
January 31, 2012, and seven proposals were received by the deadline on February 14, 2012. A
summary of the price quotes from each firm is shown below:
Series A Series B Series A & B
Underwriter Fee/$1000 Total* Fee/$1000 Total* Total*
De La Rosa 4.234 42,340 4.234 21,170 63,510
Stone &Youngberg 4.05 39,010 5.83 28,213 67,223
Wedbush 4.35 51,678 4.35 24,273 75,951
Piper Jaffra4.50 50,513 5.00 28,150 78,663
Citi 9.205 98,309 9.205 45,703 144,012
Edward Jones 16.08 186,528 No price provided 186,528
Bank of America N/A
*Actual Proposal Amount; bond sales assumptions vary slightly by proposal.
058
Underwriter Services
February 27,2012
Page 2
Azusa Light & Water's Financial Advisor, Urban Futures, reviewed each proposal as did
Utilities' staff. All responses were reviewed under the selection process guidelines set forth in
the RFP to account for: (a) experience and qualifications of firm and assigned staff, (b) sales and
pricing strategy and methodology, (c) fees and expenses, and (d) other proposal aspects
including references.
Of the submitted responses, six answered all questions in a clear and comprehensive manner.
The response received from Bank of America was deemed non-responsive as it did not convey
adequate detail required by the RFP.
Given market conditions currently, it appears that it will be more cost effective to refund Series
B debt through bond market refunding. When we consider each cost proposal from this
perspective, De La Rosa & Co. (DLR) is the lowest cost responsive and qualified underwriter.
DLR is a California based full-service investment bank that completed 79 financings during
2011 for a total par amount of $9.8 billion. DLR is a top ranked California,utility underwriter
with experience serving various California public utilities. See attached proposal for details.
FISCAL IMPACT
All costs for professional services related to this refinancing will be funded from the refunding
proceeds. However, to issue a purchase order and potentially compensate the underwriter before
the bond proceeds are made available, staff will administratively process a budget amendment in
the water and electric fund accounts following approval of this item.
Prepared by:
Cary Kalscheuer, Assistant to the Director of Utilities
Attachments:
1. Proposal Evaluations by Urban Futures
2. Proposal by De La Rosa & Co.
059
Azusa Light & Water RFP Summary
Underwriter Summary Matrix
Listed from Combined Lowest Bid to Highest Bid
Firm De La Rosa Wedbush Stone &Youngberg Piper Jaffray
Bid ($/bond) (Combined Assumes$10M Water and$5M Electric Financing)
Series A $4.23 $4.35 $4.05 $4.50
Series B $4.23 $4.35 $5.83 $5.00
Combined $4.23 $4.35 $4.64 $4.67
Team Members Guillermo Garcia Robin Thomas Steve Heaney Mark Curran
Raul Amezcua Richard Clark Tom Innis Matthew Challis
Michael Mejia Leslie Wienand Bloom lake Campos Michael Libera
John Solarczyk Ken Yoon Jose Vera Christopher Bessette
Ben Stern Peter Auzers Matt Tracey
Chris Tota Virginia Planellas Rahul Garg
Ken Williams
Parker Colvin
Betsy Kiehn
CA Water Strong Moderate Strong Moderate
Experience
CA Electric Strong Weak Moderate Weak
Experience
Firm Citi Edward Jones Bank of America
Bid ($/bond) (Combined Assumes$10M Water and$5M Electric Financing)
Series A $9.20 $16.08 Non-Responsive
Series B $9.20 $16.08 Non-Responsive
Combined $9.20 $16.08
Team Members Steven Dworkin Richard Han Jill Forsyth
Andy Nakahata Dana Cojocaru-Ivoska Laurene Cockett
Cameron Parks Stina Wishman Alex Ottiano
Darren Hodge
George Leung
Gardner Smith
Max Jian
Ron Blake
CA Water Strong Weak
Experience
CA Electric Strong Weak
Experience
® 2)16/ Q 0
Summary:
Azusa Light &Water ("AL&W") received seven responses to its Request for Proposals for Bond Underwriting Services for
Refunding Water and Electric Utility Debt. All responses were reviewed under the selection process guidelines set forth
in the RFP to account for (a) experience and qualifications of firm and assigned staff, (b) sales and pricing strategy and
methodology, (c)fees and expenses, and (d) other proposal aspects including references.
Of the submitted responses, six answered all questions in a clear and comprehensive manner. The response received
from Bank of America was deemed non-responsive as it did not convey adequate detail required by the RFP and for its
lack of satisfactory qualifications.
Recommendation:
Based on our comprehensive review of all submitted proposals, De La Rosa is recommended on the merits of its
response, experience and fee. Four firms had low combined fees of under$5 per bond, ranging from $4.23 (De La Rosa)
to $4.61 (Piper Jaffray). Of these four firms, De La Rosa and Stone & Youngberg both have strong experience selling
water bonds in California, though Stone & Youngberg's electric experience is minimal. De La Rosa has statewide electric
experience, including several recent issues. Citi also has strong water and electric experience, but their fee proposal was
double that of the other four firms.
® lurtr 2
Azusa ; Water
J �
b
Proposal t1Provide Bond Underwriting Services
February /
062
I N V E S T M E N T B A N K E R S
10866 14�ilshire Boule�•ard,Suite ]6>0 456 Montgumen Sheet, 19th Plorn
Los Angeles. California 90024 San Francisco;California 94104
TeL (310j 207-1975, Fax (310)207-1995 Tol.(415)495-R8fi3. Fax(4 1 51 495-8 864
DE LA ROSA&CO.
C I N V [ 5 7 M r N l • A N • E • 5
February-14, 2012
Mr. George F. Morrow
Director of Utilities
Azusa Light & Water
729 N. Azusa Ave.
Azusa, CA 91702
Dear Mr. Morrow:
On behalf of De La Rosa & Co. ("DLR"), we would like to thank Azusa Light & Water ("AL&W") for
the opportunity to submit our proposal to serve as underwriter for AL&W's upcoming financing. We
would eagerly embrace the opportunity to serve AL&W with an experienced and dedicated financing
team, a California-based municipal bond desk, and ample support staff to fully address AL&W's
financing needs.
As we will detail in our proposal, DLR has a long track record of bringing California utilities to the bond
market. Our experience with California utilities ranges from some of the country's largest issuers to
smaller, infrequent issuers. Regardless of size,we commit the full resources of the firm to help California
utilities achieve their unique objectives. With this experience, we believe that DLR is best suited to help
AL&W market its credit to bond investors. This unique experience supplements many other ways in
which we are highly qualified to serve AL&W:
• The "California" firm: DLR takes great pride in being the only premier full-service investment
bank headquartered in California. AL&W can be assured that its banking and underwriting team
is locally based, and that any project, from plan of finance to pricing, will occur in California.
• Leading California underwriter: In 2011, DLR ranked as the third most active underwriter of
California tax-exempt municipal bonds, with 79 financings for a total par of$9.8 billion.
• Top Ranked California Utility Underwriter: DLR has ranked as a top three senior manager for
California utilities, in every year since 2009.
• Significant Recent Experience with SCPPA Peers: DLR serves many of AW&L SCPPA peers
in both electric and water financings. Since 2009, DLR has senior managed financings for
LADWP (electric and water), Riverside (electric and water), Anaheim (water), and Vernon
(electric).
We look forward to this opportunity to work with AL&W in its upcoming financing. If you should have
any questions, please do not hesitate to reach us at the phone numbers listed below.
Sincerely,
Guillermo Garcia Raul Amezcua
Vice President, Utility Group Manager Head of Investment Banking
(415)495-8863 (310)207-1975
10866 WILSHIRE BLVD.,SUITE 1650,LOS ANGELES,CALIFORNIA 90024/TELEPHONE:(310)207-19751 FAX (310)207-1995
063
Company and Staff Qualifications
a) Name of firm and mailing address,phone and fav number of the proposers principal place of business.
b) ,flailing address,phone andfac number gflhe ffice in which the project ream toil!work.
De La Rosa & Co. ("DLR") is headquartered in Los Angeles. Below are the addresses in which the
project team will be based.
10866 Wilshire Boulevard,Suite 1650 456 Montgomery Street, 19th floor
Los Angeles,CA 90024 San Francisco,California 94104
Phone:(3 10)207-1975 Phone:(415)495-8863
Fax:(310)207-1995 Fax:(415)495-8864
c) ;tames and positions of persons to be assigned to this financing by underwriter.
t r t i • r
Guillermo Garcia San Francisco (415)495-8863 Co-Lead Banker
Vice President arcia ejdelmsa.com Ulilit Grou Manager
Raul Amezcua Los Angeles (310)207-1975 Co-Lead Banker
Princi al ramezcua e'delarosa.com Head of Investment Banking
Michael Mejia Los Angeles (310)207-1975 Support Banker
Associate - mme'ia«e'delarosa.com
Ben Stem Los Angeles (310)207-1975 Head of Underwriting
Principal bsterne'delarosa.eom
John Solarezyk Los Angeles (310)207-1975 Lead Underwriter
Senior Vice President 'solarcz kae'delzrosa.com
Chris Tota Los Angeles (310)207-1975 Head of Institutional Trading
Principal ctotac e'delarosa.com
d) ;Wailing address. slafng and degree of participation by a?v co-managers or other firms that might
participate in marketing bonds.
DLR does not intend to use a co-manager. However, DLR will work with any co-manager that AL&W
would like to include in the financing.
e) Listing of recent financings rurudcrvriter has.successjid/v n+a'keted for issuances That are of o sirrrilar ncttrue
to those included in this RFP.
DLR is an active player in the California municipal utility market. Since January 2009, we have
participated in 96 utility financings with an aggregate par amount in excess of$17.4 billion. For your
reference, please refer to Appendix I for a complete list of DLR's California utility experience since 2009.
.n References from at lease,four recent clients, including financing managers' names, addresses and phone
numbers, for which similar services have been provided in dee last three years, preferably to municipal
utilities. by the stgff to be assigned 7n[hie'financing.
Brent Mason Ed lac he rl Mario Ignacio Gary Breaux*
Finance Director Assistant General Manager Assistant Chief Financial Officer Chief Financial Officer
Riverside Public Utilities Anaheim Public Utilities Los Angeles Department of Metropolitan Water District of
Water&Power Southern California
3900 Main Street 201 S. Anaheim Boulevard 1I I N. Hope Street, 15th Floor 700 North Alameda Street
Riverside,CA 92522 Anaheim,CA 92805 Los Angeles,CA 90012 Los Angeles,California 90012
(951)826-5750 - (714)765-5273 213 367-0690 213 217-6000
.Gary Breaux is the farmer Finance Director of the East Bay Municipal Utility District.
Azusa Light&Water
Proposal to Provide Bond Underwriting Services 1b
February 14,2012 1 Page 1 of 13
064
g) Resumes and relevant experience of key.staff to be assigned by underwriter to dus financing. These should
clearly demonstrate the underu t her's qualifications to perform required tasks of this RFP.
The core financing team assigned to AL&W consist of a dedicated group of financing professionals with
tremendous experience serving California municipal utilities. Guillermo Garcia, Vice President, and
Raul Amezcua, Principal and Head of Investment Banking, would serve as Co-Lead Bankers for AL&W.
Guillermo manages DLR's Utilities Group and serves on all of the firm's utility engagements including
transactions for the California Department of Water Resources, the Metropolitan Water District of
Southern California, the East Bay Municipal Utility District, the Sacramento Municipal Utility District,
and the utilities of the Cities of Los Angeles, Riverside, Anaheim, Fresno, and San Diego. Raul will
provide project oversight for the engagement to ensure that AL&W has access to all of the firm's
resources. Michael Mejia, Associate, would, be responsible for providing quantitative and execution
support.
Ben Stern, Principal and Head of Underwriting, will provide underwriting support to ensure that there is
an efficient distribution of AL&W's bonds to a wide variety of investors. John Solareyk, Senior Vice
President, will lead DLR's underwriting efforts for AL&W. John has a breadth of experience having
worked with California utilities as a banker and underwriter. Ben and John have underwritten utility
financings for a variety of local utilities including LADWP, Riverside, Anaheim, Burbank, Colton and
most recently Vernon. Both of them will be assisted by Chris Tota, Principal and Head of Institutional
Sales and Trading. Chris joined the firm in 2009 after serving as the head of tax-exempt trading for Bear
Stearns nationwide. As head of DLR's Institutional Sales and Trading, Chris has an intimate knowledge
of the most important California utility bond investors. This knowledge will be of great help in guiding
DLR's sales people to aggressively market AL&W's credit.
DLR's proposed team will provide AL&W with the highest level of coverage possible. The entire team is
based in California, primarily from our Los Angeles headquarters, and is available on a moment's notice.
Please refer to Appendix II for complete resumes of the proposed team members.
lt) Overall company experience in utility iufrastrucuu•e financings or debt refunding. Include a briefhislot7,of
Your firm. including ownership, sice. capilal position. number of o fices nationally and accounts in
Ctdifornirr
De La Rosa & Co. ("DLR") is a broker-dealer with ---
offices in Los Angeles and San Francisco. Our sseaa�
g®y Snea,19-rlm.
headquarters and our sales and trading desk have been S Fad® CAE...94104
located in Los Angeles since our founding in 1989. rd pumeaus>49saae3
DLR is structured as an S-Corporation with seven
partners who own 100%of the equity.
As an investment bank built and headquartered in Los ` 1 �Vfthimdwxai,�16so
Angeles for 22 years, DLR's mission has been to serve �01��W5
California's issuers and the investors who provide \
capital for our state's infrastructure. DLR has fulfilled
this mission through all markets, good and bad, and
through many challenging developments in the
financial markets and among the clients we serve. It is our view that entities such as AL&W are best
served by a California firm that understands the challenges of our local economy. Our knowledge of the
key issues in the State of California has been invaluable to our clients and our ability to explain the
challenges and strengths of California utilities to investors.
DLR's corporate structure is designed such that our bankers work closely with our sales and trading
professionals to develop financial solutions that provide the greatest benefit to our clients. We apply this
team approach to develop workable financial solutions and structures for issuers and when selling
California municipal bonds to investors.
Azusa Light&Water
Proposal to Provide Bond Underwriting Services e
February 14,20121 Page 2 of 13
065
Capital Position: Throughout our 22-year history, DLR has consistently
exhibited solid financial strength and stability. Over the past six years DLR
has more than doubled in size and enhanced its commitment to the Total Capital $ 19,518,028.00
municipal bond market. Moreover, our California focus has insulated DLR Equity Capital $ 8,794,031.00
from any losses related to the subprime market and DLR did not receive Net Capital $ 12,047,368.00
any government bailout assistance or TARP funds. The table to the right Excess Capital $ 11 723,016.00
details DLR's capital position as of December 31, 2011. Based on SEC regulations, our total capital
allows us to underwrite up to$1.9 billion of unsold bonds,depending on the maturity.
California Utility Experience: DLR has a long track record of bringing utilities from across California to
the bond market, including some of the country's largest issuers, such as the Los Angeles Department of
Water and Power, the California Department of Water Resources, and the Metropolitan Water District of
Southern California. Regardless of size, we commit the full resources of the firm to help these issuers
achieve their unique objectives. Evidence of our commitment and the trust we have earned from investors
is our consistently strong utility rankings in California. The tables below show that DLR has ranked
among the top three utility underwriters in California in every year since 2009.
California Utility Rankings
Senior Manager
Morgan Stanley $ 1 535 16 1 P Morgan $ 3230 18 Cal $ 3932 25
BAML 1,342 9 Morgan Staple 2,299 18 1 P Morgan 1,935 12
Chi 902 14 Citi 2,084 30 Stifel Nicolaw 1,164 28
J P Morgan 792 6 BAML 2,053 14 Morgan Stanley 962 7
Stifel Nicolaus 543 15 Wells Fargo 1,123 17 BAML 740 7
Goldman Sachs 528 8 Goldman Sachs 1,121 9 Goldman Sachs 467 4
Barclays 479 3 Barclays 1,119 9 Barcbl2 421 2
Wedbush - 91 5 Stifel Nicolaus 962 21 Wells Fargo 396 8
Wells Fargo 77 5 RBC 881 4 Siebert 173 1
Total S 7,367 91 Total S 17,149 164 Total s 11,380 102
UnUar amium.e in millions
The case studies below highlight DLR's ability to provide the best possible service to California utilities.
a $72,740,000 City of Vernon, Electric System Revenue Bonds, 2012 Series A and 2012
Taxable Series B: On January 2012, DLR served as sole senior manager for the City of
Vernon's electric system financing. The issue, which was rated Baal/A-, generated $38
million of funds for new projects and advance refunded $29 million of 2009 Bonds to
provide near-term cash flow relief. The Electric System was downgraded by Moody's
from its previous A3 rating due to financial pressure resulting from a lack of revenue growth that had been
previously projected. This put substantial pressure on financial metrics including debt service coverage
and liquidity. In addition to the downgrade, the City suffered from several other credit/marketing
challenges: heightened media attention regarding the State legislature's efforts to disincorporate the City,
the conviction of three previous city executives, a State audit, and an IRS audit of the 2009 Bonds.
DLR, along with the entire finance team, went through a very detailed due diligence process with the City
to examine every potential issue that could be of material significance to investors. The POS portrayed an
accurate picture of a city that was in the process of correcting the mistakes of past managers and officials.
DLR spent countless hours on conference calls with investors walking them through the credit, focusing
on the real issues and clarifying the myths that had been created by the media and others.
The substantial pre-marketing paid off as DLR was able to price the bonds extremely aggressively. The
tax-exempt bonds were priced at spreads to MMD up to 100 basis points lower than where Vernon's 2009
Bonds were trading in the secondary market in the weeks prior. On the taxable series, which had a ten-year
par call, DLR was able to set spreads comparable to those of the Sacramento County pension bonds that
Azusa Light&Water
Proposal to Provide Bond Underwriting Services Q
February 14,2012 1 Page 3 of 13
066
priced in September 2011 that carried bond insurance, had similar underlying ratings, and had a make-
whole call.
$60,275,000 West Basin Municipal Water District, Refunding Revenue Bonds, Series
2011B: The West Basin issued its Revenue Refunding Bonds to refund all outstanding
e, at 2010A Certificates (commercial paper program) and to refund $10.2 million of outstanding
2003A Certificates. The financing was structured with "back-loaded" tax-exempt serial
bonds in maturities 2023 through 2032 and a term bond in 2036 to take advantage of
historically low interest rates. West Basin's financing was designed to take advantage of the all-time low
interest rate environment and was originally scheduled to price in early October, but was delayed due to
volatile market conditions. As interest rates reached all-time lows, investors began to resist such low
absolute interest rate levels, causing spreads of high grade credits to widen. In this difficult market, West
Basin's finance team worked to strategically position the financing in such a way that West Basin could
secure the lowest interest rate. In the midst of the European sovereign debt crisis, the finance team saw an
opportunity to take advantage of market dislocations and moved forward with the pricing in November.
Through an aggressive pre-marketing effort, DLR placed $19 million or 31% of the total par with retail
accounts. This helped secure lower spreads to MMD than other"AA" category credits that came to market
at the same time. The finance team's efforts facilitated the achievement of an all-in-true interest cost of
4.39%.
$34, d 2525,000 Anaheim Public Financing Authority, Revenue Bonds, Series 2010-
A an010-B: In October 2010, DLR served as sole senior manager for the City of
Anaheim's financing, issued to finance the acquisition and construction of certain
capital improvements to the Water System. The financing was structured with tax-
exempt serial bonds (Series 2010-A) in maturities 2013 through 2021 and taxable
Build America Bonds ("BABs") (Series 2010-13) in maturities 2023, 2025, 2034 and 2040. Anaheim's
financing came to market at the beginning of the "BAB-alanche," creating a challenging market for the
BABs pricing. Despite this difficult market, DLR's intensive pre-marketing campaign was able to
effectively gamer strong investor demand for the tax-exempt and taxable series of bonds. Anaheim's tax-
exempt bonds received exceptional interest from investors and priced at MMD in maturities 2013 through
2015! DLR supported an aggressive BABs pricing by "stepping up" and underwriting 42% of the 2040
BABs term bond. DLR's efforts resulted in lower pricing spreads than all comparable tax-exempt and
BABs financings sold at approximately the same time and DLR's exceptional execution resulted in a all-in-
true interest cost of 3.58%!
IZ:vr.ItSlor. $59,000,000 City of Riverside, Variable Rate Refunding Water Revenue
Bonds, Issue of 2011A (Index Interest Rate Period): In May 2011, DLR sold a
Si, $59 million SIFMA Note issue for the City of Riverside, which has been the
euen
smallest issuer to date in California to sell money market-eligible SIFMA Notes.
The Water System only has approximately $220 million of total debt, while other SIFMA Note issuers have
typically been very large, well-known agencies with multi-billion dollar debt portfolios and large variable-
rate bond programs. Additionally, the "Riverside" name made marketing challenging due to negative
investor perception of the Inland Empire.
Riverside's SIFMA Notes were structured with a "soft put" instead of a "hard put," which meant that a
failure to remarket the bonds on the mandatory tender date is not an "Event of Default" for all the Water
System bonds, and does not trigger acceleration or swap terminations. Investors strongly prefer the "hard
put" structure, though the "soft put" provides greater issuer flexibility. The only other issuer that uses the
"soft put" structure is the Metropolitan Water District of Southern California, one of the best known and
highest regarded municipal issuers in California. Some investors that approved Metropolitan's SIFMA
Notes would not approve the exact same structure for Riverside. Despite the marketing challenges, DLR
was able to price the Notes at 7 basis points over SIFMA; within 2 basis points of Metropolitan's original
SIFMA Note pricing.
Azusa Light&Water
Proposal to Provide Bond Underwriting Services
February 14,2012 1 Page 4 of 13
067
$22,740,000 City of Long Beach, Water Revenue Refunding Bonds, Series 201OA: In
November 2010, De La Rosa & Co. served as sole senior manager for the City of Long
Beach's 2010 Water Revenue Refunding Bonds. As the water enterprise's first financing
since 1997, DLR was actively engaged in all aspects of the financing, particularly in
helping the City acquire the most aggressive credit ratings possible. DLR invested
numerous hours working with the City to help them most effectively articulate their credit
strengths. This resulted in the bonds receiving underlying ratings of"Aa2/AA+" from Moody's and S&P,
respectively. Ratings were a key component to the financing because they allowed our underwriting team to
go out to the market with the most aggressive rates possible.
Thanks to the strong ratings, DLR's sales team was able to secure$29.8 million of retail orders representing
131%of the total oar and $33.5 million of institutional orders representing 147%of the total par. Garnering
significant retail interest put pressure on institutional investors, allowing DLR to reduce yields by 5 basis
points (bps) on the day of pricing. Ultimately, over 54% of bonds were sold to retail investors and DLR
was able to set interest rates on the City's bonds at spreads significantly lower (10 — 55 bps) than
comparable transactions priced during the same time. These aggressive levels resulted in an all-in true
interest cost of 2.91% and provided over$3 million(13.79%)of present value savings.
$141,200,000 Department of Water and Power of the City of Los Angeles,
Los Angeles Water System Revenue Bonds, 2009 Series B: In November 2009, DLR served
w Department of as senior manager on the Department's Water Revenue Bond financing. This tax-
p Water&Power exempt series was part of a larger combined financing that served to fund a variety
of projects for the Water System's multi-billion dollar five-year capital plan. The bonds matured from 2015
through 2020, as the Department chose to defer principal for several years, and the BAB component of the
financing was structured to mature after this series. DLR led the five-member syndicate by entering 95%of
the $152 million of retail orders, which provided strong pricing leverage over institutional investors that
bought $20 million of the longer maturities. DLR was able to price Department's Aa3/AA/AA rated bonds
at significantly lower rates than other similarly rated financings in the market that week, and at very low
spreads compared to a AAA-rated water revenue bond issue also in the market that week.
P Include a de.scripdon of,your,firtn:s municipal sales and distribution capabilities. including the volume of
las-esestpl hond.sold to inreslorc in the las!five scars. and your role as senior manager, co-manager, etc.
The "California Specialist": DLR is the recognized California municipal credit specialist because all of
the Firm's resources, banking and sales and trading, are located in California and are solely dedicated to
underwriting California municipal bonds. Investors, from professional retail to the largest institutional
accounts, covet the information and insights we provide regarding the ongoing valuation of their
investments. Our California focus and location allows us to provide this information better than our
competitors. As the recognized "California Specialist" within the municipal bond industry, DLR's
leadership within the California market is distinguished by the following:
MINIMUM SeconclarY Market Activity Market Reputation
DLR maintains one of the largest DLR's coverage of the largest institutional DLR consistently underwrites two to
full service sales and trading investors is strengthened by the liquidity four California municipal issues each
desks domiciled in California. we provide these investors through our of week. Our consistent deal flow
DLR employs 20 sales $2 $3 billion average monthly secondary provides us with current market/investor
market trading. information that we can fully utilize to
professionals whose sole focus
best
and expertise is California DLR's unique "institutional" quality
municipal bond credits. coverage of California-specific, middle- financings. re and market future
market investors, provides superior DLR has established a reputation as a
professional retail investor access. strong market maker, given our high
volume of secondary trading.
Issuance Volume: As one of California's most active underwriters, we bring a significant number of tax-
Azusa Light&Water
Proposal to Provide Bond Underwriting Services O
February 14,2012 1 Page 5 of 13
068
exempt municipal financings to market. As senior managing underwriter, we have brought 286 tax-
exempt financings, totaling $16.9 billion to market since the beginning of 2007. When our co-managed
municipal financings are included, these totals increase to 504 tax-exempt financings, totaling $133.9
billion.
Institutional Sales Capabilities: DLR's sales and trading desk actively covers over 375 institutional
accounts that sell and trade California municipal bonds. DLR's coverage of institutional investors is
directed by Chris Tota, who previously served as Head Tax-Exempt Trader for Bear Stearns. Under
Chris' direction, DLR has significantly enhanced its coverage of institutional accounts across the nation
and the liquidity we provide these investors through our secondary market trading. This coverage and
active market participation strengthens our business relationships with investors of all sizes, and we
leverage those relationships to negotiate lower yields for our municipal clients.
Retail Sales Capabilities: Throughout DLR's 22-year history, the firm has differentiated itself from its
competitors by covering a substantial number of non-traditional second and third-tier retail investors,
bond funds, money managers, investment advisors and trust departments. While this may sound like a
familiar refrain from many investment banks, the wide and deep relationships that DLR's sales force has
built with these "professional" money manager/quasi-retail investors goes back to the root of the firm's
founding in 1989, Since then, these relationships, many of them proprietary, have flourished and we have
mutually benefited from our growth and delivery of increased transaction flow and institutional quality
coverage. These quasi-High-Net-Worth retail investors generally submit orders between $500,000 and $2
million. Due to their significantly sized orders, this investor class can substantially alter pricing spreads
by creating a perceived higher demand in short to mid-term maturities. The reduced supply provides our
sales team leverage in negotiating with institutional investors and forces them to accept yields lower than
they would have otherwise required.
The accompanying diagram
outlines DLR's unique retail Retail Distribution High-Net-Worth
q Retail Management
investor coverage. Unlike cam„ Agreements Accounts
competitor regional firms, in R""'
w.
which retail coverage Retail
focuses on "mom and pop" �.l
investors, DLR has Retail
developed a network of Edi FIRM 13=1
professional retail investorsa
that is comprised of more tom. Q
than 200 high-net-worth metol
retail management accounts
including trust departments,
money managers and Re101
investment advisors. These LIX]
Rota
accounts eagerly purchase OE Wl
and sometimes specialize in REMN
the tax-exempt market and DLR's Retail Distribution System Reaches Thousands of
represent thousands of high- Individual High-Nd-worth Retail t°HNw'") &Local Retail Investors
net-worth individual retail
accounts in the Los Angeles metro area and California as a whole. This niche investor segment gives our
sales team access to a retail pool that is much larger than our competitors and provides our clients with an
unparalleled network of brokers and trust accounts. These broker networks are locally based and are not
well covered by other larger, New York-centric investment banks. However, with this investor segment's
support, DLR has built a stunning track record of retail order success.
To augment our in-house retail sales capabilities, DLR maintains retail distribution agreements with three
financial institutions: Credit Suisse, City National Securities, and UnionBanc Investment Services. By
Azusa Light&Water
Proposal to Provide Bond Underwriting Services C
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069
hiring DLR, AL&W would gain access to an expansive network of retail brokers in California that are
available at these institutions.
jl Describe pour relationships ivith credit enhancement providers and any innovative structures you have
utilced to improve credit rulings of issuers you have served in the past three years.
DLR maintains strong working relationships with all of the major bond insurers. However, due to the
demise of many bond insurers, DLR has most recently worked primarily with Assured Guaranty on
various financings in which insurance has provided net savings to our clients. Prior to 2008, the vast
majority of fixed-rate municipal bond issues used bond insurance but this proportion has declined
tremendously due to the severe downgrades of the bond insurers. in today's market, high-grade uninsured
debt issues, like AL&W's proposed financing, are among the most coveted credits in the market and trade
better than insured issues. Unless market conditions change radically, we anticipate that AL&W will be
best served by issuing on its own credit without bond insurance.
One of the primary structuring features that DLR has successfully executed for many of our highly rated
utility clients is to reduce or eliminate cash-funded debt service reserve funds. This has been particularly
cost effective because it mitigates the costs incurred from the current low reinvestment rates available for
reserve funds. The reasoning behind this trend is that the there is only marginal additional security with a
reserve fund when considering the regular monthly/bi-monthly payments received by utilities, as well as
the ability to raise rates and quickly shut off service for non-payment. Moreover, utilities often have very
high cash balances that make additional cash set asides in debt service reserve funds redundant. DLR has
successfully structured recent issues without reserve funds for agencies such as the Western Municipal
Water District (AA+/AA), Anaheim Water System (AAA/AAA), and the Riverside Water
(Aa2/AA+/AA+) and Electric (AA-/AA-) Systems, with no negative impact to their credit ratings. The
Case study below shows how DLR was able to help a utility system market their bonds with no reserve
fund.
iQvr.iZslDu $34,920,000 City of Riverside, Electric Revenue Refunding Bonds, Series
INS2009A: In December 2009, De La Rosa&Co. served as sole senior manager for
gLgogdl" the City of Riverside's 2009 electric revenue refunding. The issue, which was
PUDOC VTnITIrS rated Aa3/AA-/AA-, current refunded $28 million of 1998 Bonds and advance
refunded $8 million of 2001 bonds. One structuring challenge was the fact that the 1998 bonds used a
surety policy for the reserve fund, and so there was no cash from the reserve fund to contribute to the
refunding. Ultimately, DLR advised the City to go without a reserve fund on the financing. The lack of a
reserve did not affect the credit ratings or the marketing of the bonds, and was instrumental in yielding the
significant refunding savings. With strong ratings and a final maturity of 2018, DLR was able place all of
the bonds with retail investors at very aggressive interest rates. in order to create the largest demand
possible, multiple coupons were offered in six of the nine maturities. Overall, the City saved over 9%on a
net present value basis on the refunding.
Work Plan
This section should give an introduedon and overview of the approach your firm would use nv Jidfilling the
obligations set.forth in the Scope of Work of this RFP by breaking down the scope into a specific list of tasks, In
addition to describing your marketing plan,please inchede.some details regarding pricing.
As of close of business, Februaiy 1, 2012, please indicate, by mnturitie.s of one through tiventy years, an estimate of
where .-1L&W tux exempt revenue bonds would price relative to municipal market data for its hater and electric
ulilitie.s.
please describe specific marketing ideas and efforts that you would engage in as part of yom-service us underwriter
to assure that Al A HV irould get the best pricing possible.
DLR strives to provide the best and most comprehensive service possible to our clients to ensure that they
secure the lowest possible cost of borrowing. In executing this, DLR maintains the highest ethical
standards to ensure regulatory compliance from issuers and investors.
Azusa Light&Water
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070
Having said this, DLR traditionally performs all tasks listed in the scope of work on all financing in which
we serve through a diligent process that includes numerous visits and conference calls to clients and
investors. As well as maintaining an active dialogue with the entire finance team. To perform this, DLR
has listed below a proposed finance schedule that outlines the major milestones of the financing.
The table below includes two schedules, traditional and accelerated,that AL&W may want to pursue. The
traditional schedule includes two weeks of pre-marketing that would provide additional time to market the
bonds and enter the market ahead of schedule if the right opportunity presents itself. The accelerated
schedule primarily focuses on a shorter turn-around time for documents with the goal of taking advantage
of the current low interest rate environment by pricing the bonds as soon as possible. This accelerated
schedule would allow us to enter the market on the week of April 23rd and reduce market risk by one
month.
Preliminary Financing Schedule
i
Week of March 5 Week of February 27 Kick-off meeting
Week of March 19 Week of March 12 First draft of bond documents and POS circulated
Week of March 26 Week of March 19 ' Meeting to discuss first draft of documents
First draft of credit presentation circulated
Week of April 9 Week of March 26 Second draft of bond documents and POS circulated
Second draft of credit presentation circulated
• Documents submitted to rating agencies
Week of April 16 Week of April 2 Conference call to discuss second draft of bond documents and POS
City Council approves financing
Week of April 30 Week of April 9 Bond documents,POS,and credit presentation finalized
Meetings/conference calls with rating agencies
Week of Ma 14 Week of April 16 Receive ratings and post POS;beginpre-marketing
Week of May 28 Week of April 23 Price bonds
Week of June l l Week of May 7 Close financing
• Redeem Series 2003 COPS
Indicative Pricing: The accompanying DLR Pricing Views for Azusa Light& Water
table details DLR's pricing views for (as of February 1, 1011)
AL&W bonds as of February 1, 2012.
Water revenue bonds historically price at Water System(Aa3/AA+) Electric System(A2/A)
tighter spreads to MMD than electric
revenue bonds due to their historically MENEM "
stronger credit and investor preference. 2013 018% 0.05% 0.23% 3.00% 0.400/. 0.58% 3.00%
Based on the Water System's Aa3/AA+ 2014 0.30% 0.100/° 0.40% 3.00% 0.500/° 0.800/. 3.00%
ratings, DLR believes the water revenue 2015 0.46% 0.15% 0.61% 3.00% 0.60% 1.06% 3.00%
bonds would price at spreads of 5 to 25 2016 0.58% 0.20% 0.78% 3.00% 0.65% 1.23% 3.00%
2017 0.68% 0.25% 0.93% 3.00% 0.70% 1.38% 3.00%
bps to MMD in maturities 1 to 5, spreads 2018 0.901/. 0.30% 1.20% 4.00% 0.75% 1.65% 4.00%
of 30 bps to MMD in maturities 6 to 10 2019 1.14% 0.30% 1.44% 4.00% 0.75% 1.89°/ 4.00%
and spreads of 35 to 40 bps to MMD in 2020 1.34% 0.30% 1.64% 4.00% 0.75% 2.09% 4.00%
maturities 11 to 20. Due to the Electric 2021 1.53% 0.30% 1.83% 4.00°/ 0.75% 2.28% 4.00%
System's lower credit ratings, DLR 2022 1.68% 0.30% 1.98% 4.00% 0.80% 2.48% 4.00%
believes the Electric System bonds would 2023 1.80% 0.35% 2.15% 5.00% 0.90% 2.70% 5.00%
price at spreads to MMD of 35 to 45 bps 2024 1.89% 0.40% 2.29% 5.000/. 1.00% 2.89°/ 5.00%
wider than the water revenue bonds in 2025 198% 0.40% 2.38% 5.00% 1.05% 3.03% 5.00%
maturities I to 9 and spreads to MMD of 2026 2.10% 0.40°/. 2.50°/. 5.00% 1.05% 3.15% 5.00%
50 to 65 bps wider than the water revenue 2027 2.21% 0.40% 2.61% 5.00% 1.05% 3.26% 5.00%
bonds in maturities 10 to 20. Please note, 2028 2.31% 0.40% 271% 5.00% 1.05% 3.365.00%
2029 2,41% 0.40% 2.81% 5.00% 1.05% 3.46%% 5.009/o
the proposed financing would have a final 2030 2.51% 0.40% 2.91% 5.00% 1.05% 3.56% 5.00%
maturity in 2023, however, per AL&W's 2031 2.61% 0.40% 3.01% 5.00% 1.05% 3.66% 5.00%
request we have provided pricing views 2032 2.71% 0.40% 3.11% 5.00% 1.05% 3.76% 5.00%
Azusa Light&Water
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071
through twenty years.
Marketing Strategy: The proposed refunding is expected to receive ratings of ("Aa3/AA+") for the
Water System and ("A2/A") for the Electric System. The bonds will have a short final maturity in 2023
with serial bonds in 2014 through 2023. Given this structure, DLR will focus its marketing strategy on
generating the maximum amount of retail demand.
Retail Demand: Retail investors are broken into two types, traditional "mom and pop" retail and
professional retail investors. Among these, the retail buyers that will make a difference in AL&W's sale
are professional retail investors comprised of investment advisors and professional money managers.
DLR's California focus has enabled our firm to develop a niche among professional retail investors that
will be beneficial for AL&W's sale as we discuss with them the merits of AL&W's bonds. DLR's
California-based sales force covers a large number of professional retail investors that represent thousands
of high-net-worth individual retail accounts. Many of our retail investors are not well covered by other
larger firms, but represent significant demand.
These professional retail investors place large orders, often totaling several million dollars and, as a result,
require "institutional-like" coverage but rarely receive it from the national firms. The reason is that most
of these investors are domiciled in California but the national firms' sales and trading operations are in
New York. Hence, most of these investors are usually covered by local "middle market" brokers who are
not municipal bond specialists. In contrast, DLR's approach is to provide these investors with local,
California-based institutional coverage daily. As senior manager, DLR will execute the following
marketing strategies to maximize retail demand for AL&W's sale.
fna�sis Des "I
clion
Demand Create on Integrated Banking and Underwriting Team. Designate a primary investor liaison to provide
Analysis- constant feedback with regards to investor concerns. Our assigned institutional investor liaison will be Ben
Stem(Head of our Underwriting Desk)who will provide investor,concerns and insights to the banking team.
Chris Tota,will provide secondary market knowledge as the finance team nears execution providing real-time
knowledge of the technical and fundamental concerns of the market.
• Begin dialogue with professional retail investors to gauge demand for AL&W's bonds.
• Identify most likely investors.
Credit Analysis Education Camptajzn: Today's investors develop their own internal credit opinions regardless of published
and Marketing ratings. To maximize participation, DLR will do everything possible to get marketing materials out early.
This will enable investors to perforin their credit analysis well in advance of the pricing date.
• Draft"Sales Point Memo"and Credit Review for sales team to educate investors on credit.
Price Analysis& Target market analysis is used to determine appropriate interest rate levels. Our underwriting staff would use
Underwriting sales comparables, secondary trading levels and other market intelligence to determine a preliminar) pricing
spread. This spread would be presented to investors during the order period and be adjusted(hopefully lower)
to account for oversubscriptions, economic news and/or market changes. At the conclusion of the order
period,we would employ our capital to underwrite any remaining notes.
Post Sale After the bonds are sold, DLR would continue to serve as a market-maker of the AL&W's notes by actively
Analysis bidding on them in the secondary market.
Data Request
a) This section Qf the proposal shall menti=e all documents or data the undenrr'iter expects ALX W to provide in
carrying out this financing.
Below is a list of documents that DLR expects AL&W will be required to provide. Please note, this list is
not exhaustive and other information may need to be provided.
Updated CAFR and related financial • Recent rate studies
Azusa Light&Water
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072
information • Capital improvement plan
Disclosure information regarding the Water • Updated financial policies including reserves,
and Electric System's operations debt and investment guidelines
Scope Exclusions/Addenda
a) In revieiving this RFP, undenwitingrrms mrry encounter tas4 which, in the opinion gfsome.frms. mov he
unnecessary. or, mrry have been omitted. AI the Proposers discrelion, the undenrrher may identify such
tasks and either comment on irhy they should or should not be included as pari of this RFP.
DLR sees no issues with the requested information in this RFP.
Deliverables
a) Deliverables are material products such as the sales of bonds nan+ed in the Scope of 61'ork.
Credit Presentation: After a review of the credit documents, DLR will work with AL&W staff in order
to understand the relevant issues and best present AL&W's credit to investors. The credit presentation
will focus on updating the rating agencies on the current state of AL&W's finances. DLR will highlight
all of AL&W's credit strengths and clearly explain any challenges so investors and the rating analysts can
understand the overall credit quality of AL&W.
Marketing Plan: This document is drafted by the lead underwriter to lay out a comprehensive strategy to
sell the proposed financing and guide the sales force as they actively market the bonds to investors. The
Marketing Plan is drafted by the banking team in conjunction with the underwriting desk based on market
insights and initial reads. The main topics covered include identification of target investor groups, credit
overview and investor approach.
Pre-Pricing Book: DLR will provide this document to the working group the day before the final pricing
of the bonds. After having conducted extensive pre-marketing the underwriter will get indications from
investors who are most likely to place orders. DLR will use this document to get final pricing thoughts
from AL&W on interest rate levels and to obtain final approval on the scale DLR will take to the market
on the day of pricing.
Post-sale Book: DLR will prepare this document after completion of the sale in order to provide final
summary information regarding the sale to AL&W. The Post-Sale Book includes the following
information:
• Market summary during the week of sale
• Bond distribution information
• Rating reports
• Final cash flows
Azusa Light&Water
Proposal to Provide Bond Underwriting Services Q
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073
Schedule
(2) ALd 19'prefers the undenrriler to recommend timing nfsales such that it renders the greatest benefit to the
issuer. Undenrriter proposal should include a brief description gffaclors to consider in deciding when to
price and sell bonds.
interest rates are 30-year MMD Analysis
currently at all-time January 2009 to February 2012
lows and as a result, it is 6.0%a — -_—_—_-----_—___---___--
in AL&W's interest to mmn
enter the market as
quickly as possible to 5.5% i AO 11,21819 435% J. R2009 49 .1b, 39
tXr r2,2nn 381% *.mtmn,1099 41 *52 boa 12 45
take advantage of the A. 25,2010 3M1N. ,.wry 14.21111 139 .141 by 711 7 82 log
j k,nbcr n,21111 30% Rxiok,1.2011 0 N2tm' 14
current interest rate
environment. This is 5.0%
particularly true as the
market continues to
exhibit increasing
volatility. The graph to J
the right analyzes MMD 4.0%
volatility since January
2009. As can be seen
from this analysis, in the 3.5% –
last three years MMD
has seen increases as
great as 50 bps in 45 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-II May-II Sep-II Jan-12
days and increases of
141 bps in 139 days.
Given this volatile market environment we presented a traditional and accelerated market schedule in the
Work Plan section above. We note that, DLR recommends that AL&W maintain flexibility regarding
final execution. As we near pricing, DLR's underwriting team may advise to delay or advance a sale in
order to take advantage of optimal market conditions. Given the moderate par and short maturity structure
of the proposed financing, a significant inflow of cash from retail investors may facilitate a stronger
pricing, while a dislocation in the tax-exempt market due to negative headlines or exodus of cash may
warrant a delay of the sale.
Underwriter Fees or Spread for Each Series
u) Proposers shall provide a table which ,sumnusice.s costs for underwriter services in accordunce with
following!able,format for each series, Series A and Series B, as described in this RGP:
Proposed Fees: The adjacent table details DLR's proposed fees for a $15 million fixed rate bond
refunding. Our proposed fees are very aggressive because we would greatly value the opportunity to work
with AL&W. Moreover, we are willing to discuss our fees if they do not meet expectations.
Series A Proposed Spreads Series B Proposed Spreads Aggregate Proposed Expenses
SIO million far 55 million Par A.ssames$15 mdlo,o Par
Management Fee 5 - 0.000'/ S - Management Fee S - 0.000% $ - Underwrter's Counsel $ 0.667 E 10,000 -
Expenses 1.234 0,123% 12,341 Expenses 1,234 0.123% 6,171 CDIAC 0.150 2250
Underwriter Fee - 0.000% . Underwriter Fee - 0.000% - CUSIPs 0,023 345
Average Takedown 3.000 0.300916 30,000 Average Takedown 3.000 0.300°/ 15,000 DTC 0.033 500
Additional 0.000% Additional QDWI Day Loan 0.028 417
Total Spread S 4.234 0.423%, $42,341 Total Spread - S 4.234 0.423% $21,171 Out of Pocket 0.333 5,000
Total S 1.234 S 18,512
Azusa Light&Water
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074
Other Client Commitments
«) UndcrnvrilinK,ftrnr.chn!!ultest to the nr«ilahiliry gJ'Icep staff iojur fill the obligations o(lhis engagement in a
ps q/essional and lintely manner. /f there are anv scheduling issues gfconcern, then underwrUingfirm shall
disclose those other commitments in its Proposal to Al.&W and hrdicale how such other conanilnrews will
he addressed to mitigate their effect on services rendered to.41.444'.
DLR is committed to meeting the financing goals of AL&W in a timely manner. As such, DLR does not
currently have any scheduling conflicts or foreseeable impediments to a suitably timed execution of this
transaction.
Other
a) This section should contain anv additional information the underwriting fain feels will strengthen the
proposal or be of interest to A 11'.
Bond Series Structure: The most critical "big picture" decision that AL&W needs to address is how to
approach the two refundings, whether to execute them entirely separately or combined in some fashion.
Three potential options are presented below.
1. Completely separate financings: The most straight-forward approach would be to treat the two
refundings as entirely separate transactions that just happen to be executed simultaneously. Each
series would have its own bond documents, preliminary/final official statements, and bond
purchase agreements. Benefits of this approach include simplicity and fairness, as each system
clearly pays its own way. On the other hand, there would be higher costs for this scenario, as
series would be duplicated.
2. Separate series,joint disclosure: Another option would be to issue two separate series of bonds
but to use a single preliminary/final official statement for each series. This is the approach taken
in the 2003 FARECal financing, and it was more common in the age of bond insurance, which
"commoditized" municipal bonds. It is less common today to have two different credits with two
different ratings on the same POS/OS, but not unheard of. This approach would have some cost
savings, as only one disclosure document would need to be created instead of two. Much of the
disclosure would be redundant, since the background information on the City and AL&W would
only be included once. Each system would pay its own way, as there is no cross-collateralization
among the two series. There are no major negatives to this scenario.
3. Single series: Finally, AL&W could potentially sell one series of bonds that is secured by
revenues of both the Water and Electric Systems. One way in which AL&W could effect this
would be by selling one series of bonds through the Azusa Public Financing Authority, secured
by two installment payment agreements, one for the Water System and one for the Electric
System. The main downside to this approach is the disparate ratings of the Water System
(Aa3/AA+) and the Electric System (A2/A). The combined financing would likely receive a
rating in between the two (potentially Al/AA- or similar), which means that the Water System
would subsidize the rating of the Electric System. However, this would reduce the level of legal
documents prepared, as there would be only one set of bond documents, one POS/OS and one
bond purchase agreement. Additionally, AL&W would receive an additional cost reduction
because they would only pay one rating fee.
Unless AL&W explicitly wants to subsidize the Electric System, DLR recommends option 2. By issuing
separate series and filing a single disclosure, AL&W can achieve cost savings over option 1, yet still
engage in a relatively straight-forward approach that has each system support itself.
Azusa Light&Water
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075
Bond Authority: As a general law city, Azusa does not have the authority to issue water or electric
revenue bonds on its own for new money purposes. Therefore, it has to issue through the Azusa Public
Financing Authority ("APFA"). In this structure, an installment payment agreement is created through
which APFA sells bonds to investors, uses the cash from the bond sale to build a project, and then "sells"
the project to the Water or Electric System. The Water or Electric System then makes semi-annual
payments to APFA in the amount of debt service on the bonds, and APFA pays back investors.
However, AL&W has another option in this case because both financings are refundings. The City of
Azusa could issue Revenue Refunding Bonds under the "Refunding Statute," (Section 53570 of Articles
10 and 1 I of Chapter 3 of Part I of Division 2 of Title 5 of the California Government Code). Investors
prefer utility bonds that are sold through the City over utility bonds sold through a PFA. This is the case
because a PFA can issue many different types of bonds with different credits and different security
provisions, so there is less clarity and a perception of greater risk in PFA bonds than City bonds. DLR
estimates AL&W could save approximately 5 bps by using the Refunding Statute and issuing bonds
through the City instead of APFA.
Reserve Funds: Most revenue bond financings fund reserve accounts sized at the least of the maximum
annual debt service, 125% of average annual debt service, or 10%of par. While fully-funded reserve funds
are critical for certain types of financings, such as land secured, tax increment, and lease financings, they
are not as essential for other stronger types of credit. Given the strong security of utility revenue credits, a
reserve fund of this magnitude does not provide substantial incremental credit benefit. In the past, reserve
funds essentially "paid for themselves" since it was possible to re-invest the reserve fund at the arbitrage
yield. However, the current low interest environment causes reserve funds to be a net cost for issuers,
since they cannot be reinvested at the arbitrage yield. For these reasons, DLR has advocated to our utility
clients to use smaller reserve funds when possible.
A review of AL&W's previous bond documents indicate, AL&W is not legally required to fund a reserve
fund and thus has the legal authority to forgo this expense. Based on our assessment of AL&W's credit,
and according to the City's 2011 CAFR, the Water System currently has 631 days cash on hand. Due to
this significant cash balance, AL&W can sell its water bonds without a reserve fund with no rating or
interest rate penalty. The Electric System is in a different cash position with only 26 days cash on hand,
requiring it to fully fund a reserve based on the traditional sizing parameters.
Integrated Coverage Team: As noted above, DLR maintains a dedicated utility coverage group headed
by Guillermo Garcia. Our utility specialist professionals have extensive experience working with some of
the largest utilities in California and can provide significant sector specific insights. These professionals
work closely together on related financings and can provide a comprehensive array of unique expertise
that will prove essential in securing the lowest cost of borrowing for AL&W. Additionally, DLR provides
direct access to our underwriter John Solarczyk who can provide insight on the California municipal
market on a moment's notice.
Azusa Light&Water
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076
Appendix
13 La Rosa&Co.
I N V E 5 7 M E N T 0 A N K E R 5
De La Rosa&Co.California Utility Experience
✓anua 10091,Present
Pending .So California Metra Water Di Wale,Revenue Bonds 2012 LhAD S 200,000,000
Pending City of.San Diego Ware,Revenue Ronde 2012 CO-MGIC 200,000,000
Pending City ofl.os Angeles Wariewarer Revenue Bands 2012 LEAD 20.000,,000
Pending City of Turlock Sewer Revenue Rands 2011 LEAD 55,0(10,011/1
Pending City nfBevdy Hid., Water Revenue Bonds 1011 LEAD 35,0110,0120
Pending Cary oJ'lmpe,tol Water and Wastewater Revenue Bonds 1012 CO-MGR 18,000,,0011
Pending Camrnaa Water District Wafer and Waaewarer Revenue Bond., 2012 .SOLE 8,()00,(100
01/10/12 Vernon City-California Electric System Revenue Bonds 2012 Series SOLE 35,100,000
01/10/12 Vernon City-California Electric System Revenue Bonds 2012 Series A SOLE 37,640,000
11/22/11 Burlingame Financing Auth Water&Wastewater Rev Ref Bonds Series 2011 SOLE 5,935,000
11/01/11 West Basin Municipal Water Dt Refunding Revenue Bonds Series 2011B LEAD 60,275,000
10/06/11 California Dept of Wtr Resources Water System Revenue Bond Series AJ LEAD 216,930,000
0927/11 Contrast,Water Dt Water&Wastewater Revenue Bonds Series 2011A SOLE 9,630,000
09/14/11 Sacramento MUD(SMUD) Electric Revenum Refunding Bonds 2011 Series X CO-MGR 325,550,000
08/30/11 West Basin Municipal Water Dt Refunding Revenue Bonds Series 2011A CO-MGR 34,190,000
08/16/11 California Dept of Wtr Resources Power Supply Revenue Bonds Series 2011 N LEAD 479,782,000
08/16!1 1 California Dept of Wtr Resources Power Supply Revenue Bonds Series 2011 N LEAD 479,783,000
ON27/I1 Imperial Irrigation On Electric System Ref Rev Bonds Series 2011 C CO-MGR 75,745,000
06/15/11 Los Angeles Dept of Wtr&Power Power System Revenue Bonds 2011 Series A LEAD 694,130,000
06/08/11 So California Metro Water Dt Water Revenue Refunding Bonds 2011 Series B CO-MGR 167,855,000
05/25/11 Riverside City-California Refunding Water Revenue Bonds Issue of2011A SOLE 59,000,000
04/27/11 San Mateo City-California - Sewer Revenue Bonds 2011 Series SOLE 31,990,000
04/26/11 Anaheim Public Finance Auth Revenue Bonds Series 2011A CO-MGR 90,390,000
02/16/11 Imperial Irrigation DI Electric System Ref Revenue Bonds Series 2011 A CO-MGR 78,065 000
12/16/10 Covina Public Finance Auth Water Revenue Bonds Series 2010 LEAD 15,000,000
12/16/10 So California Metro Water Dt Water Revenue Bonds 2010 Series A CO-MGR 250,000,000
1124/10 Los Angeles Dept of Wtr&Power Power System Revenue Bonds 2010 Series D LEAD 760,200,000
10."17/10 Califomia Dept of Wtr Resources Water System Revenue Bonds Series At LEAD 92,275,000
1027/10 California Dept of Wtr Resources Water System Revenue Bonds Series AH LEAD 97,675,000
10/20/10 Anaheim Public Finance Auth Revenue Bonds Series 2010 A SOLE 4,835,000
10/20/10 Anaheim Public Finance Auth Revenue Bonds Series 2010 B SOLE 29,690,000
10/19/10 Western Muni Wir Dt Facs An Water Revenue Bonds Series of 2010 A SOLE 8,485,000
10/19/10 Western Muni Wtr Dt Facs An Water Revenue Bonds Series of 2010 B SOLE 42,755,000
10/14/10 Los Angeles City-Califomia Wastewater System Revenue Bonds Series 2010 B CO-MGR 89,600,000
10/14/10 Los Angeles City-Califomia Wastewater System Revenue Bands Series 2010A CO-MGR 177,420,000
10/06/10 California Dept of Wtr Resources Power Supply Revenue Bonds Series 2010 M CO-MGR 881 607,000
10/06/10 California Dept of Wtr Resources Power Supply Revenue Bonds Series 2010 M CO-MGR 881,608,000
09/29/10 So California Metro Water Dt Waterworks GO Refunding Bonds 2010 Series A CO-MGR 39,485,000
09/15/10 Lang Beach City-Califomia Water Revenue Refunding Bonds Series 2010 A SOLE 22,740,000
08/24/10 So California Pub Pwr Au(SCPPA) Revenue Bonds Series 2010-1 CO-MGR 514,160,000
07/29/10 Sacramento Cc Sanit Dt Fin Auth Revenue Bonds Sereis 2010 B CO-MGR 15,930,000
07/29/10 Sacramento Co Sanit Dt Fin Auth Revenue Bonds Sereis 2010 A CO-MGR 110,690,000
07/21/10 Sacramento MUD(SMUD) Electric Revenue Bonds 2010 Series CO-MGR 250,000,000
07/14/10 So California Metro Water Dt Water Revenue Refunding Bonds 2010 Series B CO-MGR 88,845,000
06/17/10 Northern California Power Agency Lodi Energy Center Revenue Bonds 2010 Series A CO-MGR 78,330,000
06/17/10 Northern Califomia Power Agency Lodi Energy Center Revenue Bonds Series 2010 B CO-MGR 176,625,000
06/16/10 San Diego Public Facs Fin Auth Water Revenue Refunding Bonds Series 2010 A CO-MGR 123,075 000
06/15/10 Sunnyvale City-California Water Revenue Bonds Series 2010 SOLE 24,085 000
06/15/10 Sunnyvale City-Califomia Wastewater Revenue Bonds Series 2010 SOLE 35,380,000
06/10/10 Northern California Power Agency Lodi Energy Center Revenue Bonds 2010 Series A CO-MGR 30,540,000
06/10/10 Northem California Power Agency Lodi Energy Center Revenue Bonds 2010 Series B CO-MGR 110,225,000
0526110 So California Pub Pwr An(SCPPA) Revenue Bonds 2010 Series A CO-MGR 110,460,000
05/26/10 So California Pub Pwr An(SCPPA) Revenue Bonds 2010 Series CO-MGR 191,010,000
05/20/10 Los Angeles Dept of Wtr&Power Power System Revenue Bonds 2010 Series A CO-MGR 616 000,000
05/06110 Marin Municipal Water Dt Water Revenue Bonds 2010 Series A SOLE 31,850,000
05/05/10 California Dept of Wtr Resources Power Supply Revenue Bonds Series 2010 L LEAD 1,496,270 000
05/05/10 California Dept of Wtr Resources Power Supply Revenue Bonds Series 20101, LEAD 1496,270,000
04/30/10 Garden Grove Public Fin Auth Water Revenue Bonds Series 2010 C SOLE 3,195,000
04/30/10 Garden Grove Public Fin Auth Water Revenue Bands Series 2010 B SOLE 4,125,000
10 Uk:I.t Nast&(A.
2/1412012
078
L
Be La Rosa&Co.California utility Experience
January 1009 to Present
04/30/10 Garden Grove Public Fin Auth Water Revenue Bonds Series 2010 A SOLE 9,305,000
03r03/10 Gilroy City-Califomia Wastewater Revenue Ref Bonds Series 2010 LEAD 23,375000
01/28/10 Oxnard Financing Authority Water Revenue Project Bonds Series 2010 A SOLE 16,455 000
01/28/10 Oxnard Financing Authority Water Revenue Project Bonds Series 2010 B SOLE 83,670,000
01/27/10 So California Pub Pwr Au(SCPPA) Revenue Bonds Series 2010-1 CO-MGR 237,235,000
01/26/10 East Bay MUD Water System Sub Rev Ref Bonds Series 2010 A LEAD 192,830,000
01/21/10 Fresno City-California Water System Revenue Bonds 2010 Series A-I LEAD 66,810,000
01/21/10 Fresno City-Califomia Water System Revenue Bonds 2010 Series A-2 LEAD 91,340,000
12/09/09 Riverside City-California Water Rev Refunding Bonds Issue of 2009A SOLE 31,895,000
12/09/09 Riverside City-California Electric Rev Refunding Bonds Issue of 2009A SOLE 34,920000
12/09/09 Riverside City-California Water Revenue Bands Issue of 20098 SOLE 67,790000
12/01/09 So California Metro Water Dt Water Revenue Refunding Bonds 2009 Series E CO-MGR 26,050,000
12/01;09 So California Metro Water Dt Waterworks GO Refunding Bonds 2009 Series A CO-MGR 45 515,000
I V19/09 Los Angeles Dept of War&Power Water System Revenue Bonds 2009 Series B LEAD 141,200,000
11/17/09 California Dept of Wtr Resources Water System Revenue Bonds Series AG CO-MGR 169,115,000
08/06/09 Central Valley Financing Auth Cogeneration Proj Rev Ref Bonds Series 2009 CO-MGR 48,920,000
08/06/09 Riverside City-California Sewer Revenue Bonds Series 2009 A CO-MGR 36,835,000
08/06/09 Riverside City-California Sewer Revenue Bonds Series 2009 B CO-MGR 204,075 000
08/06/09 Sacramento Cogeneration Auth Cogeneration Proj Rev Ref Bonds Series 2009 CO-MGR 57,530,000
07/30/09 So California Metro Water Or Water Revenue Refunding Bonds 2009 Series D CO-MGR 81,065,000
07/30/09 So California Metro Water On Water Revenue Bonds 2008 Series D CO-MGR 87,500,000
07/30/09 So California Metro Water Or Water Revenue Bonds - 2008 Series D CO-MGR 162,500,000
06/16/09 San Diego Public Facs Fin Auth Water Revenue Bonds Series 2009 B CO-MGR 328,060,000
06/04/09 So California Metro Water On Water Revenue Bonds 2008 Series C CO-MGR 78,385,000
06/04/09 So California Metra Water Dt Revenue Refunding Bonds 2009 Series B&C CO-MGR 219,470,000
05/06/09 Los Angeles Dept of WIT&Power Power System Revenue Bonds 2009 Series B LEAD 172,125,000
05/06/09 Vernon City-California Electric System Revenue Bonds 2009 Series A CO-MGR 419,400,000
05/05/09 Sacramento MUD(SMUD) Electric Revenue Bonds 2009 Series V CO-MGR 200,000,000
03/18/09 Los Angeles City-Califomia Wastewater System Rev Ref Bonds Series 2009-A LEAD 454,785,000
03/11/09 East Bay MUD Water Sys Sub Rev Ref Bonds Series 2009 A-2 LEAD 165,575,000
02/24/09 Anaheim Public Finance Auth Revenue Bonds Series 2009-A CO-MGR 70,000,000
02/10/09 Las Angeles Dept of War&Power Power System Revenue Bonds 2009 Series A LEAD 123,120,000
01/27/09 Las Angeles Dept of War&Power Water System Revenue Bonds 2009 Series A CO-MGR 150,000,000
01/22/09 So California Pub Pwr Au(SCPPA) Transmission Proj Rev Ref Bonds 2009 Sub Series A CO-MGR 117 280,000
01/15/09 So California Metro Water Or Water Revenue Bonds 2008 Series A CO-MGR 200 000,000
01/07/09 California Dept of Wtr Resources Power Supply Revenue Bands Series 2005 F3&FS CO-MGR 174,065 000
01/07/09 California Dept of War Resources Power Supply Revenue Bonds Series 2005 F3&F5 CO-MGR 174,065 000
Total Par S 17,460,690,000
Number of Financings 96
Er Dr Ls lis nx r0.
aY ... ...... ..... . 7/14/2012
079
Appendix
D F La ROSH�Co.
I N V f 5 i M E N T B A N N E R S
080
6
Guillermo Garcia, Vice President, Utility Group Manager
456 Montgomery Street, 19th Floor Tel: (415)495-8863 /Fax: (415)495-8864
San Francisco, California 94104 ggarcia@ejdelarosa.com
Guillermo is based in the firm's San Francisco office and manages DLR's Utility Group, which focuses
on California power, water and wastewater utilities. He joined DLR in 2006 after two years at Kelling,
T' Northcross & Nobriga, a California-based financial advisory firm. Guillermo has recently led senior-
managed financings for the Western Municipal Water District, the Marin Municipal Water District, and
the City of Fresno's water system. He also serves as co-lead banker for DLR's engagements with the
East Bay Municipal Utility District, the California Department of Water Resources, the Metropolitan
Water District of Southern California, Los Angeles Department of Water and Power, the Sacramento
Municipal Utility District, the Imperial Irrigation District, the City of Los Angeles Wastewater System,
the Sacramento Regional County Sanitation District, and the utilities of the cities of Riverside, San Diego, Anaheim, and
San Mateo.
Prior to business school, Guillermo worked for the engineering firm Malcolm Pimie, Inc., where he helped utilities across
California improve their operational and financial practices, including the Santa Clara Valley Water District, the San
Francisco Public Utilities Commission, the San Diego County Water Authority, the South Coast Water District and the
Otay Water District.
Guillermo received an MBA, Bachelor's, and Master's in Civil Engineering degrees from Stanford University. He also
holds the Series 52 and 63 licenses.
Raul Amezcua,Principal and Head o(lnvestment Banking
10866 Wilshire Boulevard, Suite 1650 Tel: (310)207-1975/Fax: (J 10)207-1995
Los Angeles, California 90024 ramezcuapej del arosa.com
Raul Amezcua is a 21-year municipal industry veteran, having spent 12 years at Wall Street firms before
joining DLR in 2003. He has completed more than 100 senior managed debt financings with an aggregate
*? par value exceeding $22 billion including numerous major utility financings. Raul has worked with
many California utilities, including the Southern California Public Power Authority, the Metropolitan
Water District of Southern California, the Sacramento Regional County Sanitation District, the Los
Angeles Department of Water and Power, the Imperial Irrigation District, and the utility departments of
f 5! the cities of Riverside, Anaheim and Fresno.
Raul received an MBA from the Anderson School at UCLA and a bachelor's degree in Finance from the University of
Southern California. He currently serves as Chairman of the Puente Learning Center, a not-for-profit entity that provides
educational programs to underprivileged children in East and South Central Los Angeles. Raul is a past board member of
the California Public Securities Association. He holds the Series 7, 24, 27, 53, and 63 licenses.
Michael Mejia,Associate
10866 Wilshire Boulevard,Suite 1650 Tel: (310)207-1975 /Fax: (310) 207-1995
Los Angeles,California 94104 mmejia@ejdelarosa.com
Michael Mejia joined DLR in 2009 and serves clients out of our Los Angeles office. His primary
responsibilities include financial modeling and conducting credit and market analyses. Michael focuses
on California utility and transportation revenue bond issuers and has served as support banker for several
notable DLR issuers, such as the Los Angeles Department of Water and Power, Western Municipal Water
District,the City of Los Angeles and the utilities of the cities of Anaheim and Riverside.
Michael received a BS in Environmental Economics and Policy from the University of California,
Berkeley. He holds the Series 7 and 63 licenses.
Azusa Light&Water
Proposal to Provide Bond Underwriting Services C
February 14,2012/Page I of 2
081
John Solarczyk,Senior Vice President
10866 Wilshire Blvd, Suite 1650 Tel: (310)207-1975/Fax: (310)207-1995
Los Angeles, California 90024 isolarcz k(cDeidelarosa com
John Solarczyk recently rejoined De La Rosa & Co. and works closely with DLR's bankers and sales
_ professionals to tailor bond marketing programs that will secure optimal pricing for our issuer's
` transactions. John brings 19 years of extensive knowledge of California municipal credits and direct
experience with the buyers that most actively invest in them. John's technical expertise and previous
banking background will be invaluable in providing the level of institutional quality information, clearly
communicated, that will be required to secure a wider group of investors to approve this transaction's
credit. John graduated cum laude with a Bachelor of Arts Degree in Business Economics from the
University of California, Los Angeles. He holds Series 7, 24, 52 and 63 securities licenses.
Benjamin Stern,Principal and Head of Underwriting
10866 Wilshire Boulevard, Suite 1650 Tel: (3 10)207-1975/Fax: (3 10) 207-1995
Los Angeles, California 90024 bstem(a)eidelarosa com
Benjamin Stern, will lead DLR's underwriting, sales and trading efforts. Ben will rely on his 23 years and
$330 billion of underwriting experience to direct the marketing, distribution and underwriting efforts for
SCPPA. Ben directs the pricing and marketing of all municipal issues underwritten by DLR. Under Ben's
leadership, the firm's sales force has developed a strong trading practice with institutions, bank trust
departments, investment counselors and high net-worth retail investors, Ben's desk covers a substantial
number of second and third tier investors and California-based middle market accounts (i.e. money
managers and high net-worth retail investors)that many other large firms do not.
Ben received an MBA with a concentration in finance and real estate from the Anderson School of Management at
UCLA. He holds Series 7, 24, 53 and 55 licenses.
Chris Tota, Principal and Head of Institutional Sales and Trading
10866 Wilshire Boulevard, Suite 1650 Tel: (3 10)207-1975 /Fax: (310) 207-1995
Los Angeles, California 90024 ctota@ejdelarosa.com
Chris Tota heads the Institutional Sales and Trading Department for DLR. He has nearly 20 years of
experience trading municipal bonds in the national arena, and has specialized in California credits. He has
x worked with distribution professionals to market municipal debt to retail and institutional investors. His
primary responsibility on the transaction will be to provide oversight of DLR's sales efforts and ensure an
efficient distribution of bonds to investors.
Chris joined DLR in 2008, after serving as Director of Tax-Exempt Risk and a Senior Managing Director
at Bear Stearns in New York. Before that he was Director of Bear Stearns' Los Angeles Municipal Bond
Department.
Chris earned a Bachelor's degree in Marketing at Southern New Hampshire University. He is registered with FINRA and
holds Series 7, 52, 53 and 63 licenses. He was President of the Los Angeles Municipal Bond Club in 2006.
Azusa Light&Water
Proposal to Provide Bond Underwriting Services Q
February 14,2012/Page 2 of 2 Q
082
m
Disclaimer
De La Rosa & Co. is providing the information contained in this report for discussion purposes
in anticipation as serving as an underwriter to you and is not intended to he, and does not
constitute advice from De La Rosa & Co, nor should it be construed as "Advice" within the
meaning of the Securities Exchange Act of 1934. In our capacity as underwriter, De La Rosa &
Co., will be acting as a principal in a commercial, arms length transaction and not as a
municipal advisor,financial advisor or fiduciary to you regardless of whether we have or are
currently acting as such on a separate transaction. The information was prepared by De LaRosa
& Co. sales, trading, banking or other non-research personnel. This is not a research report and
the views and information contained herein should not be viewed as independent of the interests
of De La Rosa & Co. trading or sales desks. By submitting this document to you, De La Rosa &
Co. is not advising you to take any particular action based on the information, opinions or views
contained in this document and acceptance of this document will be deemed by you as acceptance
of these conclusions. To the extent that that any price levels are noted, they are for informational
purposes only and are not intended for use by third parties and are indicative as of the date of
this document and are not a commitment by De La Rosa & Co. to trade at any price. We make no
express or implied representation or warranty with respect to the accuracy or completeness of
this material nor are we obligated to provide updated information on the securities or strategies
discussed. We encourage you to consult with your own legal, accounting, tax,financial and other
advisors, as applicable to the extent you deem appropriate.
ns
Dow. 4 .,
AZUSA
RIGNI L WATER
CONSENT CALENDAR
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE SA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES
DATE: FEBRUARY 27, 2012
SUBJECT: ADDITION OF $10,000 TO THE BLANKET PURCHASE ORDER OF
COASTLINE EQUIPMENT, INC
RECOMMENDATION
It is recommended that the Utility Board approve the addition of$10,000 to the blanket purchase
order (BPO) of Coastline Equipment, Inc.
BACKGROUND
Coastline Equipment is the Water Division's Distribution System mechanic for repairs and
maintenance of the crew's backhoes and tractors. At the beginning of the fiscal year, a blanket
purchase order (BPO) for Coastline Equipment was established in the amount of $11,499.99.
Due to an increase in maintenance and repair work of the Water Distribution Division's tractors
and backhoes, the BPO has a current balance of $1,096.92. It is estimated repair and
maintenance costs through fiscal year end will be upwards to $10,000 and so staff is
recommending that Coastline's BPO be increased by this amount.
FISCAL IMPACT
The fiscal impact of this action will be $10,000. A budget amendment to account 32-40-723-761-
6835 will be processed administratively following approval of this item. Funding will come
from Water Fund balance. The Coastline Equipment BPO will total $21,499.99.
Prepared by:
Chet F. Anderson, P.E., Assistant Director- Water Operations
084
A
114X1 6 W�IEZUSA
9
AF
CONSENT CALENDAR
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES
DATE: FEBRUARY 27, 2012
SUBJECT: APPROVAL OF NOTICE OF COMPLETION - PROJECT W-266A, WATER
MAIN REPLACEMENT IN HILLTOP AVENUE IN AZUSA, AND SAN
BERNARDINO ROAD IN WEST COVINA AND LOS ANGELES COUNTY
AND WORKMAN AVENUE IN WEST COVINA
RECOMMENDATION
It is recommended that the Utility Board approve the addition of 42 calendar days to the Time of
Completion, accept Project W-266A, and direct the City Clerk's Office to execute the Notice of
Completion and have the same recorded at the Office of the Los Angeles County Recorder.
BACKGROUND
The Water Division has a program of replacing water mains that are experiencing problems with
leaks and that are, for various reasons, experiencing flow and pressure problems. Bids for this
project were received on March 15, 2011.
At its regular meeting held on March 28, 2011, the City Council approved the award of contract
for water main replacement services for approximately 9,200 linear feet of pipeline to C.P.
Construction, Inc. of Ontario, California for a bid amount of $1,196,541.50. The contract
Completion date for all work was October 13, 2011. The project was substantially complete on
November 25, 2011.
Due to some weather related delays and delays caused by unforeseen site conditions, the
Contractor needed an additional 42 days to bring the project to substantial completion.
FISCAL IMPACT
The fiscal impact of approving Notice of Completion involves the return of $117,293.00
currently held by the City as retainage on this project following a 35 day waiting period. The
addition of 42 calendar days to the time of completion has no fiscal impact.
Prepared by: Chet F. Anderson, P.E., Assistant Director, Water Operations
085
RECORDING REQUESTED BY
City of Azusa
AND WHEN RECORDED MAIL TO:
NAME Azusa City Clerk
STREET
ADDRESS 213 E. Foothill Blvd.
CITY,STATEAzusa,CA 91702
ZIP CODE
NOTICE OF COMPLETION
Notice pursuant to Civil Code Section 3093,must be filed within 10 days after completion.(See reverse side for Complete requirements.)
Notice is hereby given that:
I. The undersigned is owner or corporate officer of the owner of the interest or estate stated below in the property hereinafter described:
2. The full name of the owner is The City of Azusa
3. The full address of the owner is 729 N.Azusa Avenue,Azusa CA 91702
4. The nature of the interest or estate of the owner is:In fee.
IIF OnT..R TI IAN HE STRIRI:IN FEE AND INSERT.MR F.%AMPIF.,PURCIIASFA UNDER CONTRACT OF PURCHASE,OR 1.14SSFA}
5. The full names and full addresses of all persons,if any,who hold title with the undersigned asjoint_tenants or as tenants in common are:
NAMES ADDRESSES
None
6. The full names and full addresses of the predecessors in interest of the undersigned,if the property was transferred subsequent to the commencement of
the work or improvements herein referred to:
NAMES ADDRESSES
None
7. A work of improvement on the property hereinafter described was completed on February 27 2012 The work done was:
Project W-266A -Pipeline Replacement-675 LF in Hilltop Azusa;2,780 LF San Bernardino Rd West Covina and LA County 5,662 LF Workman
West Covina.
8. The name of the contractor,if any,for such work of improvement was
CP Construction Co. Inc. 105 S. Loma Place Upland CA 91786 April 4 2011
IIF NO CONTRACTOR FOR WORK OF IMPROVF.MI:NT AS A M1011.INSERT NONE) IDATI!OF CONTRAC1)
9. The property on which said work of improvement was completed is in the City of Azusa,County of Los Angeles,and State of CA;and is described as
follows:Project W-266A -Pipeline Replacement-675 LF in Hilltop Azusa 2.780 LF San Bernardino Rd West Covina and LA Comm 5,662 LF
Workman,West Covina
10. The street address of said property is None
Joseph R. Rocha, Mayor
Dated:.
ISIONAIIIRE OF OW MIR OR CORM,RATC OFFICCR OF OWNER NAMED IN PARAGRAPH 2 O HIS AOP.NN
VERIFICATION
I,the undersigned,say: I am the person who signed the foregoing notice. I have read said notice of completion and know its contents,and the facts stated
therein are true of my own knowledge.
I declare under penalty of perjury that the foregoing is true and correct.
Executed at Azusa,California,this day of February 27,2011
Joseph R. Rocha, (SIGNATURE)
lrp[J
-6 .
A7_LJSA
riuxr x nar[e
CONSENT CALENDAR
TO: HONORABLE CHAIRPERSON AND MEMBERS OF TH USA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITI
DATE: FEBRUARY 27, 2012
SUBJECT: AWARD OF CONTRACT FOR COLLECTION AGENCY SERVICES TO
SEQUOIA FINANCIAL SERVICES
RECOMMENDATION
It is recommended that Sequoia Financial Services be awarded a five-year contract for collection
agency services for unpaid closed utility bills and property damages.
BACKGROUND
On October 24, 2011, the Utility Board authorized staff to solicit proposals for collection agency
services due to various problems with the existing collection agency, PMR Progressive. A
request for proposals was sent to five qualified vendors and one proposal was received from
Sequoia Financial Services located in Glendale.
Staff visited Sequoia and found them to be professional and customer-focused. Sequoia has
multi-lingual staff and can provide Small Claims Court assistance when appropriate. Sequoia
also has a client portal for our use and employs a variety of collection tools including a team of
experienced collectors who are well-trained in collection regulations and receive refresher
training every 90 days.
The City of Riverside has been using Sequoia and is satisfied with their collection results and
service. The cities of Alhambra and Glendora also use Sequoia. The City of Glendale also
recently selected Sequoia to be their collection agency.
FISCAL IMPACT
Since collection fees are added to the amounts due Azusa, there will be no direct fiscal impact of
the recommendation although we anticipate the new collections agency will have greater success
in collecting past amounts unpaid to the utility.
Prepared by: Karen Vanca, Assistant Director- Customer Care & Solutions
087
CITY OF AZUSA
PROFESSIONAL SERVICES AGREEMENT
1. PARTIES AND DATE.
This Agreement is made and entered into this_day of 20 by
and between the City of Azusa, a municipal organization organized under the laws of the State
of California with its principal place of business at 213 East Foothill Boulevard, Azusa,
California 91702-1295 ("City") and Sequoia Financial Services, a corporation with its principal
place of business at 500 N. Brand Blvd., Suite 1200, Glendale, CA 91203 ("Sequoia"). City and
Sequoia are sometimes individually referred to as "Party" and collectively as "Parties."
2. RECITALS.
2.1 Sequoia.
Sequoia desires to perform and assume responsibility for the provision of certain
professional services required by the City on the terms and conditions set forth in this
Agreement. Sequoia represents that it is experienced in providing collection agency services to
public clients.
2.2 Project.
City desires to engage Sequoia to render such services for collection of unpaid closed
utility accounts project ("Project") as set forth in this Agreement.
3. TERMS.
3.1 Scope of Services and Term.
3.1.1 General Scope of Services. Sequoia promises and agrees to furnish to the
City all labor, materials, tools, equipment, services, and incidental and customary work necessary
to fully and adequately supply the professional collection agency services necessary for the
Project ("Services"). The Services are more particularly described in Exhibit "A" attached
hereto and incorporated herein by reference. All Services shall be subject to, and performed in
'
accordance with, this Agreement, the exhibits attached hereto and incorporated herein by
reference, and all applicable local, state and federal laws, rules and regulations.
3.1.2 Term. The term of this Agreement shall be from March 1, 2012 to
February 28, 2017, unless earlier terminated as provided herein. Sequoia shall complete the
Services within the term of this Agreement, and shall meet any other established schedules and
RVPUMNG51544364 -
B-1
088
deadlines. No account(s) may be withdrawn by City during the first 180 days after assignment
without the consent of Sequoia.
3.2 Responsibilities of Sequoia.
3.2.1 Control and Payment of Subordinates; Independent Contractor. The
Services shall be performed by Sequoia or under its supervision. Sequoia will determine the
means, methods and details of performing the Services subject to the requirements of this
Agreement. City retains Sequoia on an independent contractor basis and not as an employee.
Sequoia retains the right to perform similar or different services for others during the term of this
Agreement. Any additional personnel performing the Services under this Agreement on behalf
of Sequoia shall also not be employees of City and shall at all times be under Sequoia's exclusive
direction and control. Sequoia shall pay all wages, salaries, and other amounts due such
personnel in connection with their performance of Services under this Agreement and as required
by law. Sequoia shall be responsible for all reports and obligations respecting such additional
personnel, including, but not limited to: social security taxes, income tax withholding,
unemployment insurance, disability insurance, and workers' compensation insurance.
3.2.2 Schedule of Services. Sequoia shall perform the Services expeditiously,
within the term of this Agreement, and Sequoia represents that it has the professional and
technical personnel required to perform the Services in conformance with such conditions. In
order to facilitate Sequoia's conformance with the Schedule, City shall respond to Sequoia's
submittals in a timely manner. Upon request of City, Sequoia shall provide a more detailed
schedule of anticipated performance to meet the Schedule of Services.
3.2.3 Conformance to Applicable Requirements. All work prepared by Sequoia
shall be subject to the approval of City.
3.2.4 Substitution of Key Personnel. Sequoia has represented to City that
certain key personnel will perform and coordinate the Services under this Agreement. Should
one or more of such personnel become unavailable, Sequoia may substitute other personnel of at
least equal competence upon written approval of City. In the event that City and Sequoia cannot
agree as to the substitution of key personnel, City shall be entitled to terminate this Agreement
for cause. As discussed below, any personnel who fail or refuse to perform the Services in a
manner acceptable to the City, or who are determined by the City to be uncooperative,
incompetent, a threat to the adequate or timely completion of the Project or a threat to the safety
of persons or property, shall be promptly removed from the Project by the Sequoia at the request
of the City. The key personnel for performance of this Agreement are as follows: James Sears,
King Bechtel, and Shery Weaver.
3.2.5 City's Representative, The City hereby designates Azusa Light& Water's
Assistant Director Customer Care & Solutions, or his or her designee, to act as its representative
for the performance of this Agreement ("City's Representative"). City's Representative shall
have the power to act on behalf of the City for all purposes under this Contract. Sequoia shall
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not accept direction or orders from any person other than the City's Representative or his or her
designee.
3.2.6 Sequoia's Representative. Sequoia hereby designates King Bechtel, or his
or her designee, to act as its representative for the performance of this Agreement ("Sequoia's
Representative"), Sequoia's Representative shall have full authority to represent and act on
behalf of the Sequoia for all purposes under this Agreement. The Sequoia's Representative shall
supervise and direct the Services, using his best skill and attention, andshall be responsible for
all means, methods, techniques, sequences and procedures and for the satisfactory coordination
of all portions of the Services under this Agreement.
3.2.7 Coordination of Services. Sequoia agrees to work closely with City staff
in the performance of Services and shall be available to City's staff, Sequoias and other staff at
all reasonable times.
3.2.8 Standard of Care; Perf6rmance of Employees. Sequoia shall perform all
Services under this Agreement in a skillful and competent manner, consistent with the standards
generally recognized as being employed by professionals in the same discipline in the State of
California. Sequoia represents and maintains that it is skilled in the professional calling
necessary to perform the Services. Sequoia warrants that all employees and subcontractors shall
have sufficient skill and experience to perform the Services assigned to them. Finally, Sequoia
represents that it, its employees and subcontractors have all licenses, permits, qualifications and
approvals of whatever nature that are legally required to perform the Services, including a City
Business License, and that such licenses and approvals shall be maintained throughout the term
of this Agreement. As provided for in the indemnification provisions of this Agreement, Sequoia
shall perform, at its own cost and expense and without reimbursement from the City, any services
necessary to correct errors or omissions which are caused by the Sequoia's failure to comply with
the standard of care provided for herein. Any employee of the Sequoia or its sub-Sequoia
contractors who is determined by the City to be uncooperative, incompetent, a threat to the
adequate or timely completion of the Project, a threat to the safety of persons or property, or any
employee who fails or refuses to perform the Services in a manner acceptable to the City, shall be
promptly removed from the Project by the Sequoia and shall not be re-employed to perform any
of the Services or to work on the Project.
3.2.9 Laws and Regulations. Sequoia shall keep itself fully informed of and in
compliance with all local, state and federal laws, rules and regulations in any manner affecting
the performance of the Project or the Services, including all Cal/OSHA requirements, and shall
give all notices required by law. Sequoia shall be liable for all violations of such laws and
regulations in connection with Services. If the Sequoia performs any work knowing it to be
contrary to such laws, rules and regulations and without giving written notice to the City,
Sequoia shall be solely responsible for all costs arising therefrom. Sequoia shall defend,
indemnify and hold City, its officials, directors, officers, employees and agents free and harmless,
pursuant to the indemnification provisions of this Agreement, from any claim or liability arising
out of any failure or alleged failure to comply with such laws, rules or regulations.
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3.2.10 Insurance.
3.2.10.1 Time for Compliance. Sequoia shall not commence Work
under this Agreement until it has provided evidence satisfactory to the City that it has secured all
insurance required under this section. In addition, Sequoia shall not allow any subcontractor to
commence work on any subcontract until it has provided evidence satisfactory to the City that the
subcontractor has secured all insurance required under this section.
3.2.10.2 Minimum Requirements. Sequoia shall, at its expense,
procure and maintain for the duration of the Agreement insurance against claims for injuries to
persons or damages to property which may arise from or in connection with the performance of
the Agreement by the Sequoia, its agents, representatives, employees or subcontractors. Sequoia
shall also require all of its subcontractors to procure and maintain the same insurance for the
duration of the Agreement. Such insurance shall meet at least the following minimum levels of
coverage:
(A) Minimum Scope of Insurance. Coverage shall be at least as
broad as the latest version of the following: (1) General Liability: Insurance Services Office
Commercial General Liability coverage (occurrence form CG 0001); (2)Automobile Liability:
Insurance Services Office Business Auto Coverage form number CA 0001, code 1 (any auto);
and (3) Workers'Compensation and Employer's Liability: Workers' Compensation insurance as
required by the State of California and Employer's Liability Insurance.
(B) Minimum Limits of Insurance. Sequoia shall maintain
limits no less than: (1) General Liability: $1,000,000 per occurrence for bodily injury, personal
injury and property damage. If Commercial General Liability Insurance or other form with
general aggregate limit is used, either the general aggregate limit shall apply separately to this
Agreement/location or the general aggregate limit shall be twice the required occurrence limit;
(2)Automobile Liability: $1,000,000 per accident for bodily injury and property damage; and (3)
Workers'Compensation and Employer's Liability: Workers' Compensation limits as required by
the Labor Code of the State of California. Employer's Liability limits of$1,000,000 per accident
for bodily injury or disease.
3.2.10.3 Professional Liability. Sequoia shall procure and maintain,
and require its sub-Sequoias to procure and maintain, for a period of five (5) years following
completion of the Project, errors and omissions liability insurance appropriate to their profession.
Such insurance shall be in an amount not less than $1,000,000 per claim, and shall be endorsed
to include contractual liability.
3.2.10.4 Insurance Endorsements. The insurance policies shall
contain the following provisions, or Sequoia shall provide endorsements on forms supplied or
approved by the City to add the following provisions to the insurance policies:
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(A) General Liability. The general liability policy shall be
endorsed to state that: (1) the City, its directors, officials, officers, employees, agents and
volunteers shall be covered as additional insured with respect to the Work or operations
performed by or on behalf of the Sequoia, including materials, parts or equipment furnished in
connection with such work; and (2)the insurance coverage shall be primary insurance as respects
the City, its directors, officials, officers, employees, agents and volunteers, or if excess, shall
stand in an unbroken chain of coverage excess of the Sequoia's scheduled underlying coverage.
Any insurance or self-insurance maintained by the City, its directors, officials, officers,
employees, agents and volunteers shall be excess of the Sequoia's insurance and shall not be
called upon to contribute with it in any way.
(B) Workers' Compensation and Employers Liability Coverage.
The insurer shall agree to waive all rights of subrogation against the City, its directors, officials,
officers, employees, agents and volunteers for losses paid under the terms of the insurance policy
which arise from work performed by the Sequoia.
(C) All Coverages. Each insurance policy required by this
Agreement shall be endorsed to state that: (A) coverage shall not be suspended, voided, reduced
or canceled except after thirty (30) days prior written notice by certified mail, return receipt
requested, has been given to the City; and (B) any failure to comply with reporting or other
provisions of the policies, including breaches of warranties, shall not affect coverage provided to
the City, its directors, officials, officers, employees, agents and volunteers.
3.2.10.5 Separation of Insureds; No Special Limitations. All
insurance required by this Section shall contain standard separation of insureds provisions. In
addition, such insurance shall not contain any special limitations on the scope of protection
afforded to the City, its directors, officials, officers, employees, agents and volunteers.
3.2.10.6 Deductibles and Self-Insurance Retentions. Any
deductibles or self-insured retentions must be declared to and approved by the City. Sequoia
shall guarantee that, at the option of the City, either: (1)the insurer shall reduce or eliminate
such deductibles or self-insured retentions as respects the City, its directors, officials, officers,
employees, agents and volunteers; or(2) the Sequoia shall procure a bond guaranteeing payment
of losses and related investigation costs, claims and administrative and defense expenses.
3.2.10.7 Acceptability of Insurers. Insurance is to be placed with
insurers with a current A.M. Best's rating no less than A:VIII, licensed to do business in
California, and satisfactory to the City.
3.2.10.8 Verification of Coverage. Sequoia shall furnish City with
original certificates of insurance and endorsements effecting coverage required by this
Agreement on forms satisfactory to the City. The certificates and endorsements for each
insurance policy shall be signed by a person authorized by that insurer to bind coverage on its
behalf, and shall be on forms provided by the City if requested. All certificates and
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endorsements must be received and approved by the City before work commences. The City
reserves the right to require complete, certified copies of all required insurance policies, at any
time.
3.2.11 Safety. Sequoia shall execute and maintain its work so as to avoid injury
or damage to any person or property. In carrying out its Services, the Sequoia shall at all times
be in compliance with all applicable local, state and federal laws, rules and regulations, and shall
exercise all necessary precautions for the safety of employees appropriate to the nature of the
work and the conditions under which the work is to be performed.
3.3 Fees and Payments.
3.3.1 Compensation. Sequoia shall receive compensation, including authorized
reimbursements, for all Services rendered under this Agreement at the rates set forth in
Exhibit "A" attached hereto and incorporated herein by reference. Extra Work may be
authorized, as described below, and if authorized, will be compensated at the rates and manner
set forth in this Agreement.
3.3.2 Payment of Compensation. Sequoia shall submit to City a monthly
itemized statement which indicates accounts collected, amounts, and amount due the City. City
shall, within 45 days of receiving such statement, review the statement and pay all approved
charges thereon, if any are due.
3.3.3 Reimbursement for Expenses. Sequoia shall not be reimbursed for any
expenses unless authorized in writing by City.
3.3.4 Extra Work. At any time during the term of this Agreement, City may
request that Sequoia perform Extra Work. As used herein, "Extra Work" means any work which
is determined by City to be necessary for the proper completion of the Project, but which the
parties did not reasonably anticipate would be necessary at the execution of this Agreement.
Sequoia shall not perform, nor be compensated for, Extra Work without written authorization
from City's Representative.
3.4 Accounting Records.
3.4.1 Maintenance and Inspection. Sequoia shall maintain complete and
accurate records with respect to all costs and expenses incurred under this Agreement. All such
records shall be clearly identifiable. Sequoia shall allow a representative of City during normal
business hours to examine, audit, and make transcripts or copies of such records and any other
documents created pursuant to this Agreement. Sequoia shall allow inspection of all work, data,
documents, proceedings, and activities related to the Agreement for a period of three (3) years
from the date of final payment under this Agreement.
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3.5 General Provisions.
3.5.1 Termination of Agreement.
3.5.1.1 Grounds for Termination. At any time after 180 days from the
effective date of this Agreement, City may, by written notice to Sequoia, terminate the whole or
any part of this Agreement at any time and without cause by giving written notice to Sequoia of
such termination, and specifying the effective date thereof, at least thirty (30) days before the
effective date of such termination.
3.5.1.2 Effect of Termination. Upon termination, Sequoia shall be
compensated only for those services which have been adequately rendered to City, and Sequoia
shall be entitled to no further compensation except in the event accounts assigned prior to
termination are in a paying, promise to pay, or legal status. City may, at its discretion, permit
collection activity to continue on any account assigned to Sequoia prior to Termination notice. If
City determines to withdraw accounts not in a state of paying, promise to pay, or legal status,
Sequoia shall be required to provide such document and other information within fifteen (15)
days of the request. Sequoia may terminate this Agreement on 90 days written notification.
3.5.1.3 Additional Services. In the event this Agreement is terminated in
whole or in part as provided herein, City may procure, upon such terms and in such manner as it
may determine appropriate, services similar to those terminated.
3.5.2 Delivery of Notices. All notices permitted or required under this
Agreement shall be given to the respective parties at the following address, or at such other
address as the respective parties may provide in writing for this purpose:
Sequoia:
Sequoia Concepts, Inc., dba Sequoia Financial Services
500 N. Brand Blvd., Suite 1200
Glendale, CA 91203
Attention: King Bechtel
City:
City of Azusa
213 East Foothill Blvd.
Azusa, CA 91M-1295
Attn: Director, Azusa Light & Water
Such notice shall be deemed made when personally delivered or when mailed, forty-eight
(48) hours after deposit in the U.S. Mail, first class postage prepaid and addressed to the party at
its applicable address. Actual notice shall be deemed adequate notice on the date actual notice
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occurred, regardless of the method of service.
3.5.3 Confidentiality. All memoranda, procedures, descriptions, computer
data, input record data, written information, and other Documents and Data either created by or
provided to Sequoia in connection with the performance of this Agreement shall be held
confidential by Sequoia. Such materials shall not, without the prior written consent of City, be
used by Sequoia for any purposes other than the performance of the Services. Nor shall such
materials be disclosed to any person or entity not connected with the performance of the Services
or the Project. Nothing furnished to Sequoia which is otherwise known to Sequoia or is
generally known, or has become known, to the related industry shall be deemed confidential.
Sequoia shall not use City's name or insignia, photographs of the Project, or any publicity
pertaining to the Services or the Project in any magazine, trade paper, newspaper, television or
radio production or other similar medium without the prior written consent of City.
3.5.4 Cooperation; Further Acts. The Parties shall fully cooperate with one
another, and shall take any additional acts or sign any additional documents as may be necessary,
appropriate or convenient to attain the purposes of this Agreement.
3.5.5 Attorney's Fees. If either party commences an action against the other
party, either legal, administrative or otherwise, arising out of or in connection with this
Agreement, the prevailing party in such litigation shall be entitled to have and recover from the
losing party reasonable attorney's fees and all other costs of such action.
3.5.6 Indemnification.
3.5.6.1 Sequoia's Responsibility. Sequoia shall defend, indemnify and
hold the City, its officials, officers, employees, volunteers and agents free and harmless
from any and all claims, demands, causes of action, costs, expenses, liability, loss,
damage or injury, in law or equity, to property or persons, including wrongful death, in
any manner arising out of or incident to any alleged acts, omissions or willful misconduct
of Sequoia, its officials, officers, employees, agents, Sequoias and contractors arising out
of or in connection with the performance of the Services, the Project or this Agreement,
including without limitation the payment of all consequential damages and attorneys fees
and other related costs and expenses. Sequoia shall defend, at Sequoia's own cost,
expense and risk, any and all such aforesaid suits, actions or other legal proceedings of
every kind that may be brought or instituted against City, its directors, officials, officers,
employees, agents or volunteers. Sequoia shall pay and satisfy any judgment, award or
decree that may be rendered against City or its directors, officials, officers, employees,
agents or volunteers, in any such suit, action or other legal proceeding. Sequoia shall
reimburse City and its directors, officials, officers, employees, agents and/or volunteers,
for any and all legal expenses and costs incurred by each of them in connection therewith
or in enforcing the indemnity herein provided. Sequoia's obligation to indemnify shall
not be restricted to insurance proceeds, if any, received by the City, its directors, officials,
officers, employees, agents or volunteers.
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3.5.6.2 City Responsibility. Notwithstanding the provisions of Section
3.5.6.1, if it is determined that Sequoia's liability in any matter resulted from the City's
negligence in providing erroneous information to Sequoia, then Sequoia shall not be
required to indemnify the City in such a case. Sequoia shall notify the City as soon as
practical if it believes the provisions of this Section 3.5.6.2 will be invoked.
3.5.7 Entire Agreement. This Agreement contains the entire Agreement of the
parties with respect to the subject matter hereof, and supersedes all prior negotiations,
understandings or agreements. This Agreement may only be modified by a writing signed by
both parties.
3.5.8 Governing Law. This Agreement shall be governed by the laws of the
State of California. Venue shall be in Los Angeles County.
3.5.9 Time of Essence. Time is of the essence for each and every provision of
this Agreement.
3.5.10 City's Right to Employ Other Similar Firms. City reserves right to employ
other firms performing work similar to Sequoia.
3.5.11 Successors and Assigns. This Agreement shall be binding on the
successors and assigns of the parties.
3.5.12 Assignment or Transfer. Sequoia shall not assign, hypothecate, or
transfer, either directly or by operation of law, this Agreement or any interest herein without the
prior written consent of the City. Any attempt to do so shall be null and void, and any assignees,
hypothecates or transferees shall acquire no right or interest by reason of such attempted
assignment, hypothecation or transfer.
3.5.13 Construction, References; Captions. Since the Parties or their agents have
participated fully in the preparation of this Agreement, the language of this Agreement shall be
construed simply, according to its fair meaning, and not strictly for or against any Party. Any
term referencing time, days or period for performance shall be deemed calendar days and not
work days. All references to Sequoia include all personnel, employees, agents, and
subcontractors of Sequoia, except as otherwise specified in this Agreement. All references to
City include its elected officials, officers, employees, agents, and volunteers except as otherwise
specified in this Agreement. The captions of the various articles and paragraphs are for
convenience and ease of reference only, and do not define, limit, augment, or describe the scope,
content, or intent of this Agreement.
3.5.14 Amendment; Modification. No supplement, modification, or amendment
of this Agreement shall be binding unless executed in writing and signed by both Parties.
3.5.15 Waiver. No waiver of any default shall constitute a waiver of any other
default or breach, whether of the same or other covenant or condition. No waiver, benefit,
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privilege, or service voluntarily given or performed by a Party shall give the other Party any
contractual rights by custom, estoppel, or otherwise.
3.5.16 No Third Party Beneficiaries. There are no intended third party
beneficiaries of any right or obligation assumed by the Parties.
3.5.17 lnvaliditySeverability. If any portion of this Agreement is declared
invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions shall continue in full force and effect.
3.5.18 Prohibited Interests. Sequoia maintains and warrants that it has not
employed nor retained any company or person, other than a bona fide employee working solely
for Sequoia, to solicit or secure this Agreement. Further, Sequoia warrants that it has not paid
nor has it agreed to pay any company or person, other than a bona fide employee working solely
for Sequoia, any fee, commission, percentage, brokerage fee, gift or other consideration
contingent upon or resulting from the award or making of this Agreement. For breach or
violation of this warranty, City shall have the right to rescind this Agreement without liability.
For the term of this Agreement, no member, officer or employee of City, during the tern of his or
her service with City, shall have any direct interest in this Agreement, or obtain any present or
anticipated material benefit arising therefrom.
3.5.19 Equal Opportunity Employment. Sequoia represents that it is an equal
opportunity employer and it shall not discriminate against any subcontractor, employee or
applicant for employment because of race, religion, color, national origin, handicap, ancestry, sex
or age. Such non-discrimination shall include, but not be limited to, all activities related to
initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff
or termination. Sequoia shall also comply with all relevant provisions of City's Minority
Business Enterprise program, Affirmative Action Plan or other related programs or guidelines
currently in effect or hereinafter enacted.
3.5.20 Labor Certification. By its signature hereunder, Sequoia certifies that it is
aware of the provisions of Section 3700 of the California Labor Code which require every
employer to be insured against liability for Worker's Compensation or to undertake self-insurance
in accordance with the provisions of that Code, and agrees to comply with such provisions before
commencing the performance of the Services.
3.5.21 Authority to Enter Agreement. Sequoia has all requisite power and
authority to conduct its business and to execute, deliver, and perform the Agreement. Each Party
warrants that the individuals who have signed this Agreement have the legal power, right, and
authority to make this Agreement and bind each respective Party.
3.5.22 Counterparts. This Agreement may be signed in counterparts, each of
which shall constitute an original.
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3.6 Subcontracting.
3.6.1 Prior Approval Required. Sequoia shall not subcontract any portion of the
work required by this Agreement, except as expressly stated herein, without prior written
approval of City. Subcontracts, if any, shall contain a provision making them subject to all
provisions stipulated in this Agreement.
CITY OF AZUSA SEQUOIA CONCEPTS, INC., dba
SEQUOIA FINANCIAL SERVICES
By: By:
James Makshanoff Roy du Plessis
City Manager President and Chief Executive Officer
Attest.
City Clerk
Approved as to Form:
Best Best & Krieger LLP
City Attorney
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EXHIBIT "A"
SCOPE OF SERVICES
A. Responsibilities of City
I. Debtor File Documentation
City agrees to provide to Sequoia all file documentation, when available,
as is ordinarily necessary to properly exercise collection activity for
account(s). Additionally, City agrees to promptly expedite all requests
from Sequoia to provide additional information as may be necessary from
time to time to further the collection activity on said account(s).
2. Payment Notification
City agrees to promptly advise Sequoia of all payments made directly to
City that relate to all accounts referred to Sequoia.
3. Phone Inquiries and Correspondence
City agrees to refer all phone calls and correspondence received from
debtors and/or related third party to Sequoia pertaining to those accounts
that have been referred to Sequoia for handling.
4. Legal Proceedings
a. City agrees to promptly respond to Sequoias' requests for
authorization on all accounts being recommended for litigation by
Sequoia and to forward any additional documentation that may be
requested in order to proceed with authorized legal proceedings.
Authorization to engage in litigation shall be granted or denied in
City's sole discretion.
b. In the event that Sequoia advances court costs for litigation and,
thereafter, City requests that legal proceedings be terminated,
Sequoia shall be reimbursed by City for the expended legal fees
and court costs on said account and in addition Sequoia shall have
a lien on any future collections to the extent of services rendered,
but not less than 20% of the assigned amount.
C. City agrees to, when necessary, furnish to Sequoia a witness for all
trials, mediations, arbitrations and hearings as needed, in addition
to providing any and all declarations and documents necessary for
litigation.
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d. City warrants that none of the claims assigned to Sequoia
hereunder, have been assigned to other collection agencies,
attorneys or other third party debt collectors, unless such prior
assignments have been terminated and reassigned to City. Any
monies received by a prior third party debt collector for accounts
assigned to Sequoia hereunder, shall be deemed to be direct
payments to City for which Sequoia shall be entitled to its full fee.
e. Sequoia shall provide small claims court assistance including, but
not limited to, recommendations, filing, and attending court with
City staff. Assistance shall include identification of accounts
whereby the debtor has not responded to Sequoia's collection
attempts, yet has the ability to pay. Prior to filing small claims
action, Sequoia shall notify and obtain City's consent. Such
consent shall be granted or denied in City's sole discretion.
Notification shall include the reasons why Sequoia deems the filing
of a particular action worthy (e.g. debtor has a job, owns personal
or real property) Sequoia's in-house legal counsel or its legal
manager under its counsel's supervision shall work, compile, and
file all necessary paperwork with court on the City's behalf and
shall accompany the City's representative to the local small claims
court. If debtor fails to attend the hearing, a judgment may be
awarded in the City's favor.If the judgment is awarded and entered
the City shall assign the judgment to Sequoia for post-judgment
collection.
B. Responsibilities of Sequoia
1. Collection Services
Sequoia agrees to accept all accounts assigned by City under the terms, conditions
and charges referred to within this Agreement. Sequoia will use due diligence and
employ such lawful means, methods and procedures as Sequoia, in its judgment,
discretion and experience, believe will best effect the collection of all accounts
assigned. Sequoia adheres to the Federal Fair Debt Collection Practices Act (15
U.S.C.A. Sections 1601 et. seq.), any regulations or rules promulgated pursuant
thereto, and all other applicable laws, rules and regulations, whether federal, state
or local.
2. Terms and Conditions
a. Credit Reporting
Sequoia will list with member credit reporting agencies all accounts that
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are referred for direct collection based on applicable laws and criteria that
may be set by City.
b. Severability
The invalidity of any provision of this Agreement will not affect the
validity of any other provision.
C. Governing Law
The laws of the State of California will govern the interpretation and
enforcement of this Agreement.
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EXHIBIT"B"
COMPENSATION
1. Commission
a. Collection fees
The following is the commission rate structure for Client assigned under
this Agreement:
A fee of 24% of the amount collected by Sequoia under this Agreement
will be charged customers for successful collection of any portion of the
assigned claim prior to filing suit. Said percentage shall be added to the
amount owed by the customer. Sequoia shall then pursue collection in an
amount equal to the amount owed by the customer plus said 24%.
A fee of 33.33 % of the amount collected by sequoia under this Agreement
will be charged customers for successful collection of any portion of the
assigned claim after suit is filed. Said percentage shall be added to the
amount owed by the customer. Sequoia shall then pursue collection in an
amount equal to the amount owed by the customer plus said 33%.
b. Both parties mutually agree that in the event a payment is made directly to
Client, Sequoia will be entitled to the commission fees described above.
2. Settlement Authorization
Sequoia may request that City agree to a settlement in an amount less than 100%
of the principal balance of an account that has been assigned. It is hereby
acknowledged and agreed that any such requests will be made on an infrequent
basis and that City shall grant or deny any such request in its sole discretion.
3. Remittance Advice/Invoice
Sequoia will remit to City on a monthly basis.
Sequoia shall have the right to endorse for deposit and collection all remittances
received in the name of City on accounts assigned to Sequoia and to deduct from
such remittance its authorized commission.
If at the time of Sequoia's monthly remittance City is indebted to Sequoia, City
agrees to allow Sequoia to offset (deduct) said indebtedness from the amount of
the remittance.
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4. Legal Proceedings
Sequoia agrees to file suit only upon receipt of written authorization
from City for suit authorization. Sequoia will advance all court costs and attorney
fees in the event suit is filed. It is agreed by both parties that Sequoia will be
allowed to withhold first monies received to offset court costs advanced by
Sequoia.
5. Interest and Attorney fees
Sequoia will compute interest on all accounts assigned for collection at an interest
rate currently allowed by law (Interest at 10% per annum from date of last
payment or date of last charge per California Civil Code Section 3289—
whichever is later, will be calculated and claimed on all of Sequoia's I" notice to
debtors). All interest and attorney fees collected will be retained by Sequoia
whether pre judgment or post judgment. Interest and attorney fees will only be
retained by Sequoia after the principal balance assigned has been collected.
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11 0
AZUSA
SCHEDULED ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERS OF TH SA
UTILITY BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIE
DATE: FEBRUARY 27, 2012
SUBJECT: INITIATION OF AB 2514 MANDATED STUDY OF APPLICABILITY
OF ENERGY STORAGE SYSTEM(S) FOR AZUSA LIGHT & WATER
RECOMMENDATION
It is recommended that the Utility Board authorize Azusa Light & Water to initiate a
study of the feasibility and economics of procuring/installing energy storage systems, as
required by California Assembly Bill 2514.
BACKGROUND
In 2010 Assembly Bill 2514 (AB 2514), the Energy Storage Bill, was signed into law.
AB 2514 requires all electric utilities in California to undertake a s d� of applicability of
energy storing technologies and, if cost effective, set goals for procuring or installing
such technologies.
The energy storage concept is not new and historically it has included technologies such
as pumped hydro, batteries, flywheels, capacitors, etc. The expected operational benefits
of these technologies are thought to be demand shifting, peak shaving, frequency
regulation, mitigation of the variability of renewable generators such as PV solar and
wind, reduction of emissions and greenhouse gases, and reductions in distribution and
transmission expenditures.
AB 2514 requires that jurisdictional regulators -- the CPUC for the IOUs, CCAs, ESPs
and local Utility Boards/Councils for the Publicly Owned Utilities -- initiate by March
1, 2012 a study of potential installations/procurement of energy storage devices
procurement for service by 12/31/2016 and 12/31/2021. The findings of said studies,
along with established year 2016 and 2021 targets, if any, must be reported to the Utility
104
Energy Storage Study
February 27, 2012
Page 2
Board and the CEC by 10/1/2014. Targets need to be reviewed and updated every three
years and their achievement reported to the Board and the CEC by 1/1/2017 and
1/1/2022, respectively.
It is important to emphasize that Section 2836.6 of the Public Utilities Code states: "All
procurement of energy storage systems by load-serving entity or local publicly
owned electric utility shall be cost effective". This means that, as it stands now, the law
would not require any energy storage procurements or installations if such were
determined not to be cost effective.
Staff may seek professional services to assist it with development and/or review of the
energy storage study. If costs of such services are expected to exceed $10,000, staff will
return for the appropriate Utility Board authorizations.
FISCAL IMPACT
Staff estimates the external cost of an energy storage study will not exceed $10,000.
Prepared by: Yarek Lehr, Assistant Director of Resource Management
1�J
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'AZUSA;
CONSENT ITEM
TO: HONORABLE MAYOR AND CITY COUNCIL MEMBE'
00
FROM: GEORGE F. MORROW,DIRECTOR OF UTILITIE i�
VIA: JAMES MAKSHANOFF✓, CITY MANAGER
DATE: FEBRUARY 21, 2012
SUBJECT: NONDISPOSAL FACILITY ELEMENT ADOPTION
RECOMMENDATION:
It is recommended that the City Council adopt attached resolution entitled:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA,
CALIFORNIA, ADOPTING THE CITY OF AZUSA'S AMENDED
NONDISPOSAL FACILITY ELEMENT.
BACKGROUND:
In 1989, when the State of California adopted its recycling mandate, AB 939, cities and counties
throughout California were required to develop and adopt recycling plans call Source Reduction and
Recycling Elements (SRREs), and Household Hazardous Waste Elements (HHWEs). These plans
were intended to show how each local agency was going to meet the waste diversion requirements of
AB 939,which were 25%by 1995 and 50%by the year 2000, and how household hazardous waste
would be recovered.
As part of the overall recycling planning process, it was believed that cities should also list the
facilities they intended to use in order to accomplish the waste reduction goals of AB 939. Toward
this end, the State adopted AB 3001 in 1992, which required each local jurisdiction to develop and
adopt a Nondisposal Facility Element (NDFE). A nondisposal facility is one that requires a solid
waste facilities permit, but does not in fact serve as a disposal site like a landfill or waste
transformation facility; nondisposal facilities include material recovery facilities, waste transfer
stations and large composting facilities, all of which serve to process waste and/or recyclables and
ship them to other locations, hence the term "nondisposal" facilities.
1 ) ?;11,171
n Imo``
l;
Nondisposal Facility Element Amendment
February 21,2012
Page 2
The City of Azusa adopted its NDFE on August 15, 1994,and it included three facilities at that time:
Fibre Fuel on Todd Street, BFI Tire Recycling on Gladstone Street, and Western Disposal Waste
Recovery and Transfer Station on Gladstone Street. None of these facilities continues to operate and
be a resource to the City of Azusa as part of its plan to divert waste from landfills and comply with
AB 939. Thus, Azusa's NDFE has become obsolete and should be amended.
Current regulations on the development of NDFEs require that all major facilities that the City
currently uses,or plans to use in the future to comply with AB 939,including proposed facilities not
yet built, be included in its NDFE. The Element should also distinguish those facilities that are
inside the City from those facilities that are outside Azusa's borders.
Since the City entered into a contract with Athens Services in the year 2000, and agreed to ship all
waste to Athens' material recovery facility(MRF),Athens's MRF is named in the attached updated
NDFE as a nondisposal facility located outside the City. Also, given the imminent closure of the
Puente Hills landfill in 2013, and Athens' purchase the California Organics facility in Victorville,
staff believes that it is prudent at this time to include the California Organics facility in with this
nondisposal facility update.
Lastly,staff was approached by Waste Management,Inc.regarding their proposed MRF and Transfer
Station on the corner of Gladstone Street and Irwindale Avenue. The California Department of
Resources Recycling and Recovery ("CalRecycle") is requiring that Waste Management, Inc.'s
proposed material recovery facility be named in the City of Azusa's NDFE in order to receive a solid
waste facility permit. For this reason, Waste Management, Inc. requested that the City of Azusa
amend its NDFE to include reference to their proposed MRF.
Azusa staff believes that Waste Management, Inc.'s MRF is likely to play a very critical role in
helping the City of Azusa comply with AB 939 after the closure of the Puente Hills landfill. Even
though Athens Services is the City's exclusive franchisee for refuse collection, there are many
independent landscape maintenance and construction companies that do business in Azusa and haul
their own waste to landfills. In 2008, staff documented that over 4,000 tons of waste was hauled to
the Puente Hills landfill by landscape maintenance and other contractors. While the City earned
recycling credit for this debris,this is not likely to be the case after the Puente Hills landfill closes in
2013 unless there are alternatives. Waste Management,Inc.'s facility will be a viable alternative and
is therefore included in attached NDFE.
FISCAL IMPACT:
There is no fiscal impact of adopting the attached amended nondisposal facility element. Once
adopted, it is simply filed with the State and County.
Prepared by: Cary Kalscheuer, Assistant to the Director of Utilities
RESOLUTION NO. 12-C13
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA,
CALIFORNIA, ADOPTING THE CITY OF AZUSA'S AMENDED
NONDISPOSAL FACILITY ELEMENT.
RECITALS
WHEREAS, Nondisposal Facilities include material recovery facilities, transfer stations,
large-scale compost facilities, that are required to obtain a solid waste facilities permit pursuant to
Public Resources Code 44001; and
WHEREAS, Public Resources Code Section 41732 requires that each City in California
adopt a Nondisposal Facility Element (NDFE) which identifies all Nondisposal Facilities that are
being used or proposed to be used by each jurisdiction to comply with the California Integrated
Waste Management Act of 1989 ("AB 939"); and
WHEREAS,Public Resources Code Section 41734.5 requires each city to amend its NDFE
from time-to-time to reflect changes in Nondisposal Facilities used or planned to be used by each
jurisdiction to comply with AB 939; and
WHEREAS, the City of Azusa last adopted its NDFE on August 15, 1994, and each of the
three facilities named in the existing NDFE is no longer in operation; and
WHEREAS,the City of Azusa entered into a contract with Athens Services in October 2000,
which required that all waste collected in Azusa by the refuse contractor be taken to Athens'material
recovery facility located in the City of Industry; and
WHEREAS, Waste Management,Inc. is planning to build a material recovery facility in the
City of Azusa at 1501 West Gladstone Street; and
WHEREAS,the Waste Management's proposed material recovery facility will process clean
loads of mixed recyclables, yard waste, and serve as a transfer facility for mixed waste; and
WHEREAS, the California Department of Resources Recycling and Recovery
("CalRecycle") is requiring that Waste Management, Inc.'s proposed material recovery facility be
named in the City of Azusa's NDFE in order to receive a solid waste facility permit; and
WHEREAS, there are currently numerous independent contractors, such as landscape
maintenance and construction contractors,that haul their own waste to the Puente Hills landfill from
Azusa; and
WHEREAS,the Puente Hills landfill has been instrumental in helping Azusa achieve its AB
939 goals by using landscape debris delivered to it by Athens Services and landscape contractors as a
landfill cover material for which the City of Azusa gets recycling credit; and
WHEREAS, the Puente Hills landfill is scheduled to close in October 2013, which will
prevent Azusa from getting recycling credit for landscape debris hauled there by Athens Services and
independent contractors; and
WHEREAS,Waste Management,Inc.'s proposed material recovery facility will accept yard
waste and other debris generated by independent contractors operating from within the City of Azusa
and will divert said waste from landfills; and
WHEREAS,Waste Management,Inc.'s material recovery facility will be critical to the City
of Azusa's continued compliance with AB 939 following the closure of the Puente Hills landfill
since it will accept locally generated recyclables, yard waste and other materials, and will recycle
much of said waste; and
WHEREAS, the American Organics compost facility located in Victorville, CA, has been
acquired by Athens Services, and is likely to be used by Athens to divert landscape debris collected
by Athens pursuant to its Franchise Agreement with the City of Azusa; and
WHEREAS, the City of Azusa has prepared a revised NDFE which is attached to this
resolution as "Exhibit A" that names Athens Services' material recovery facility, American
Organics' compost facility,and Waste Management,Inc.'s material recovery facility as Nondisposal
Facilities likely to be used by the City of Azusa in complying with AB 939;
NOW,THEREFORE,THE CITY COUNCIL OF THE CITY OF AZUSA DOES HEREBY
RESOLVE AS FOLLOWS:
1. That the recitals set forth herein are true and correct.
2. That the attached Nondisposal Facility Element is exempt from the California
Environmental Quality Act of 1970 per Public Resources Code 41735(a).
3. That the attached Nondisposal Facility Element is adopted.
4. That staff is directed to file the Nondisposal Facility Element with CalRecycle, Los
Angeles County, and any other agencies required by state law.
5. That the City Clerk shall certify the adoption of this Resolution.
PASSED, APPROVED AND ADOPTED THIS 21st day February, 2012
/Joseph R. Rocha, Mayor
ATTEST: ,
Vera Mendoza, City Clerk
I HEREBY CERTIFY that the foregoing Resolution No. 12-C13 was duly adopted by the City
Council of the City of Azusa at a regular meeting thereof on the 21 stday of February, 2012, by the
following vote:
AYES: COUNCILMEMBERS: GONZALES, CARRILLO, MACIAS, HANKS, ROCHA
NOES: COUNCILMEMBERS: NONE
ABSENT: -OUNCILMEMBERS: NONE
Vera Mendoza, City Clerk
Table of Contents
Page
Introduction 1
Definition 1
Background 1
Description of Nondisposal Facilities
Section A—Nondisposal Facilities Located within Azusa
Table A-1: Waste Management, Inc.'s "Proposed" Material Recovery Facility
Section B—Nondisposal Facilities Located outside Azusa
Table B-1: Athens Services' Material Recovery Facility
Table B-2: American Organics Compost Facility
Appendix
Description of Nondisposal Facility Element Regulations
Introduction
The California Integrated Waste Management Act of 1989 (AB 939) requires cities and counties
in California to develop, adopt and implement Source Reduction and Recycling Elements
(SRREs), Household Hazardous Waste Elements (HHWEs), and a Countywide Siting Element
(counties only). All of these Elements are to be included in a Countywide Integrated Waste
Management Plan (CIWMP).
In 1992, the California Legislature enacted Assembly Bill 3001 which amended AB 939,
requiring cities and counties to prepare and adopt a Nondisposal Facility Element(NDFE).
Definition
"Nondisposal Facility" is a solid waste facility that is required to obtain a state solid waste
facility permit, but is not a solid waste disposal or transformation facility. Therefore, the types of
facilities to be addressed in the NDFE include material recovery facilities, transfer stations, large-
scale composting facilities, and other waste processing or recycling facilities.
Background
The City of Azusa adopted a NDFE on August 15, 1994, which included three separate facilities.
Since that time, each of the facilities listed in the 1994 NDFE has ceased operation. Since Public
Resources Code (PRC) Section 41734.5 requires that changes in nondisposal facilities be
reflected in an updated NDFE, this document has been prepared to amend the City of Azusa's
NDFE.
Description of Nondisposal Facilities
The City of Azusa's NDFE identifies nondisposal facilities as defined by PRC Section 41733,
including material recovery facilities, transfer stations, large-scale composting facilities, and
large scale aggregate/inert processing facilities that the City intends to utilize to implement its
SRRE and meet the solid waste diversion requirements of PRC Section 41780.
Section A identifies and describes one proposed facility to be located in the jurisdiction of the
City of Azusa, which will recover for reuse or recycling at least five percent of the total volume
of material received by the facility. Section B identifies and describes two facilities which the
City is either using currently or plans to utilize that are located outside of the jurisdiction, that
recover for reuse or recycling at least five percent of the total volume of material received by the
facility.
Page 1
Section A
Nondisposal Facilities Located within Azusa
Table A-1
Waste Management, Incorporated
Proposed Azusa Material Recovery, Waste Transfer Station,
Material Recovery Facility will process up to
800 tons per day of recyclable materials: glass,
cardboard,plastic, metal, mixed paper and
aluminum. Materials will be shipped to
manufacturing markets.
TYPE OF FACILITY
Waste Transfer Station will process a total of
2,500 tons of municipal solid waste per day
and 500 tons per day of landscape waste.
Material Recovery Station: 800 tons per day
Waste Transfer Station: 2,500 tons per day
FACILITY CAPACITY Greenwaste: 500 tons per day
Total Permitted Capacity: 3,800 tpd
ESTIMATED AMOUNT OF WASTE SENT Up to 3,800 tons per day
TO FACILITY
EXPECTED DIVERSION RATE 90% of incoming recyclables and yard waste.
City of Azusa, City of Pasadena, City of
PARTICIPATING JURISDICTION Baldwin Park, City of San Dimas, Los Angeles
County, City of Claremont, and City of Los
Angeles
1501 W. Gladstone Street
LOCATION Azusa CA 91702
Section B
Nondisposal Facilities Located outside Azusa
r �
Table B-1
Arakelian Enterprises, Inc.
Dba Athens Services
Material Recovery Facility, Transfer/Processing Facility
Material Recovery Facility and
Transfer/Processing Facility are permitted to
process up to 5,000 per day of non hazardous—
refuse, separated or commingled recyclables
and inert. Some of the recyclable materials
TYPE OF FACILITY recovered are: newspaper, glass, metals,
plastics, inert materials, and organics.
Materials will be shipped to manufacturing
markets.
FACILITY CAPACITY Total Permitted Capacity: 5,000 tons per day
ESTIMATED AMOUNT OF WASTE SENT Up to 5,000 tons per day
TO FACILITY
DIVERSION RATE A minimum of roughly 25-30% of incoming
municipal solid waste. In addition, roughly
90% diversion for incoming source separated
recyclable material.
Los Angeles County and the cities of Azusa,
PARTICIPATING JURISDICTION Bell Gardens, Covina, Irwindale, Glendora, La
Canada Flintridge, Monrovia, Montebello,
Monterey Park, Pasadena, Redondo Beach, San
Gabriel, San Marino, Sierra Madre, South El
Monte, South Pasadena, Temple City, West
Covina, West Hollywood, and other cities in
the general vicinity.
LOCATION 14048 Valley Boulevard
Industry, CA 91746
Table B-2
American Organics Compost Facility
TYPE OF FACILITY Organics & composting facility.
FACILITY CAPACITY Total Permitted Capacity: 700 tons per day
ESTIMATED AMOUNT OF WASTE SENT Up to 700 tons per day
TO FACILITY
DIVERSION RATE 100% of incoming green waste and organics.
Los Angeles County and the cities of Azusa,
PARTICIPATING JURISDICTION Bell Gardens, Covina, Irwindale, Glendora, La
Canada Flintridge, Los Angeles City,
Monrovia, Montebello, Monterey Park,
Pasadena, Redondo Beach, San Gabriel, San
Marino, Sierra Madre, South El Monte, South
Pasadena, Temple City, West Covina, West
Hollywood, and other cities in the general
vicinity.
LOCATION 20055 Shay Rd., Victorville, CA 92394
Appendix
This appendix provides a copy of certain sections out of the California Code of Regulations
regarding nondisposal facility elements.
Title 14. Natural Resources
Division 7. California Integrated Waste Management Board
Chapter 9. Planning Guidelines and Procedures for Preparing and Revising Countywide Integrated
Waste Management Plans
"[Article 6.4. Nondisposal Facility Element (Refs & Annos)
0§ 18752. Scope.
(a) The Nondisposal Facility Element (NDFE) shall identify the nondisposal facilities to be used by a
jurisdiction to assist in reaching the diversion mandates of Public Resources Code Section 41780.
(b) The NDFE shall include the items identified in Sections 18752 through 18754.5 of this chapter.
(c) For the purpose of this Article, a nondisposal facility is any solid waste facility required to obtain a
permit pursuant to Article 1 (commencing with Section 44001) Chapter 3, Part 4 of the Public
Resources Code, except a disposal facility or a transformation facility.
(d) The NDFE shall reflect information available to a jurisdiction at the time of the development of the
document. The NDFE may also contain additional information as determined by a jurisdiction.
(e) A jurisdiction may include other facilities not defined as nondisposal facilities (i.e. recycling
centers, drop-off centers, household hazardous waste facilities, etc.).
(f) For the purpose of this Article, a jurisdiction is a city, county, city and county, or regional agency.
Note: Authority cited: Section 40502, Public Resources Code. Reference: Sections 41730; 41731,
41732, 41733 and 41750.1, Public Resources Code.
Title 14. Natural Resources
Division 7. California Integrated Waste Management Board
Chapter 9. Planning Guidelines and Procedures for Preparing and Revising Countywide Integrated
Waste Management Plans
"EArticle 6.4. Nondisposal Facility Element (Refs &Annos)
I1§ 18753. Description of Nondisposal Facilities within a Jurisdiction.
The NDFE shall identify all existing, expansion of existing, and proposed nondisposal facilities located
within a jurisdiction which recover for reuse or recycling at least five percent of the total volume of
material received by the facility.
(a) Each facility description shall include, but is not limited to:
(1) type of facility;
(2) facility capacity;
(3) anticipated diversion rate or expected diversion rate from the total amount of the waste that the
facility receives; and,
(4) participating jurisdictions.
(b) Each facility location description may include, but is not limited to:
(1) address of the facility; or,
(2) description of the general area, (include a land use map, zoning map, or other type of planning
map).
Note: Authority cited: Section 40502, Public Resources Code. Reference: Sections 41730, 41731,
41732, 41733 and 41750.1, Public Resources Code.
Title 14. Natural Resources
Division 7. California Integrated Waste Management Board
Chapter 9. Planning Guidelines and Procedures for Preparing and Revising Countywide Integrated
Waste Management Plans
"CArticle 6.4. Nondisposal Facility Element (Refs & Annos)
01,§ 18753.5. Description of Nondisposal Facilities outside a Jurisdiction.
The NDFE shall identify all existing, expansion of existing, and proposed nondisposal facilities which a
jurisdiction, plans to utilize, but which are not located within the jurisdiction, and which recover for
reuse or recycling at least five percent of the total volume of material received by the facility.
(a) Each facility description shall include, but is not limited to:
(1) type of facility;
(2) estimated amount of the waste the jurisdiction will transport to the facility;
(3) anticipated diversion rate or expected diversion rate from the total amount of the waste that the
facility receives; and,
(4) location of facility.
Note: Authority cited: Section 40502, Public Resources Code. Reference: Sections 41730, 41731,
41732, 41733 and 41750.1, Public Resources Code.
Title 14. Natural Resources
Division 7. California Integrated Waste Management Board
Chapter 9. Planning Guidelines and Procedures for Preparing and Revising Countywide Integrated
Waste Management Plans
"Article 6.4. Nondisposal Facility Element (Refs & Annos)
y§ 18754. Description of Transfer Stations within a Jurisdiction.
The NDFE shall identify existing, expansion of existing, and proposed transfer stations located within a
jurisdiction, which recover less than five percent of the volume of materials received for reuse or
recycling.
(a) Each facility description shall include, but is not limited to:
(1) name of facility; and,
(2) participating jurisdictions.
(3) facility capacity.
(b) Each facility location description may include, but is not limited to:
(1) address of the facility; or,
(2) description of the general area, (include a land use map, zoning map, or other type of planning
map).
Note: Authority cited: Section 40502, Public Resources Code. Reference: Sections 41730, 41731,
41732, 41733 and 41750.1, Public Resources Code.
Title 14. Natural Resources
Division 7. California Integrated Waste Management Board
Chapter 9. Planning Guidelines and Procedures for Preparing and Revising Countywide Integrated
Waste Management Plans
'IitArticle 6.4. Nondisposal Facility Element (Refs &Annos)
N/§ 18754.5. Description of Transfer Stations outside a Jurisdiction.
The NDFE shall identify existing, expansion of existing, and proposed transfer stations to be used by a
jurisdiction but not located within the jurisdiction, which recover less than five percent of the volume
of materials received for reuse or recycling.
(a) Each facility description shall include, but is not limited to:
(1) name of facility; and,
(2) location of facility.
Note: Authority cited: Section 40502, Public Resources Code. Reference: Sections 41730, 41731,
41732, 41733 and 41750.1, Public Resources Code.
r
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AZLJS.A
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UGMI R WAif4
INFORMATION ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE A UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES
DATE: FEBRUARY 27, 2012
SUBJECT: SECOND QUARTER BUDGET REPORT FOR WATER AND ELECTRIC
FUNDS FOR FISCAL YEAR 2011-12
Attached reports include unaudited budget information regarding the Water and Electric funds
through December 31, 2011.
In general, both the Water and Electric funds had positive net cash flow through the second
quarter of FY 2011-12, with Electric fund having positive net cash flow of about $2.2 million,
and Water fund having positive net cash flow of about $1.25 million. The positive cash flow of
the Electric fund allowed it to reach the minimum reserve target of$12.6 million.
Last fiscal year, the City used Cash from the Water Fund to purchase land for economic
development purposes, and this asset is now listed on the Water fund's balance sheet as "Land
held of resale". This transaction reduced Cash of the Water Fund by about $2.9 million. With
the positive net cash flow of the Water fund through December 31, 2011, the estimated "Cash"
reserve is about $22.7 million. While this is below the $25 million reserve target for the Water
fund, it is mainly due to the purchase of land for economic development.
Consumption (sales) through the end of the second quarter continues to track at historically low
levels for both the Water and Electric utilities. Water consumption through December 31, 2011,
was slightly lower than the second quarter of prior fiscal year, thus water sales in terms of CCFs
reached the lowest level in 8 years.
Electric sales were slightly higher than last year through the same period. Tables on next page
show the sales and billing trends for the Water and Electric utilities since FY 04-05 through
second quarter of each fiscal year.
106
S
Quarterly Financial Report
February 27, 2012
Page 2
2nd Quarter Electric Sales/Billings
FY kWh Sales Billings
04-05 133,339,089 $14,655,236
05-06 129,833,967 $14,380,345
06-07 139,649,981 $ 16,052,403
07-08 136,375,872 $ 15,872,058
08-09 139,176,034 $ 18,276,924
09-10 133,286,521 $ 16,229,555
10-11 126,364,551 $ 17,834,281
11-12 126,375,198 $19,286,751
2nd Quarter Water Sales/Billings
FY CCF Sales Billings
04-05 5,191,531 $8,321,053
05-06 5,236,280 $7,874,961
06-07 5,677,810 $8,815,286
07-08 5,083,893 $8,696,748
08-09 4,735,337 $7,841,814
09-10 4,503,313 $8,513,021
10-11 4,269,226 $9,248,071
11-12 4,248,276 $9,315,888
Through December 31, 2011, both the Water and Electric Utilities exceeded minimum debt
service coverage ratios required by long-term debt financing agreements. This is very positive
considering that both utilities are pursuing refinancing of long-term debt within the next 3-6
months.
Attached reports show very strong financial performance, however, it should be noted that
expenditures in the area of purchased power costs are expected to increase during the second half
of the fiscal year. Both utilities continue to be conservative in terms of spending on "capital
outlays" and "capital improvements", with Electric utility only spending 29% of budgeted funds,
and Water spending about 39% of budget.
Prepared by:
Cary Kalscheuer, Assistant to the Director of Utilities
ia!
Electric Utility Quarterly Budget Report
2nd Quarter Ended Dec 31,2011
(UNAUDITED)
Consumption-kWh: 238,728,205 126,375,198 52.94%
Cash/Reserve Prior Fiscal Year Endf11 $11,751,632 $13,999,783 119%
FY 2009-2010 Budget
11-12, 12/31/11 Bu
Revenue
Retail Billing Amounts(2) $34,002,525 $19,286,752 57%
Resale Revenue(3) 6,664,395 3,754,411 56%
Other Miscellaneous Revenue 303,300 203,566 67%
Interest Income 152,915 68,289 45%
Total Revenues $41,123,135 $23,313,018 57%
Expenses
Purchased Power(3) $26,330,710 $13,784,689 52%
Transmission/Dispatching 4,180,970 2,029,585 49%
Operations and Maintenance 3,448,885 1,578,325 46%
Administrative and General(4)
2,188,211 741,263 34%
Franchise and In-Lieu-Tax 3,400,250 1,951,924 57%
Subtotal Expenses $39,549,026 $20,085,787 51%
Capital Expenditures/Debt Service
Long Term Debt Service(5) $948,151 $474,076 50%
Capital Outlays and Projects(6) 1,730,240 505,005 29%
Total Expenditures $42,227,417 $21,064,868 50%
Adjustments
Transfers Out(7) 9,450 - 0%
Total Expenditures and Transfers Out $42,236,867 $21,064,868 50%
Change in Cash/Reserve ($1,113,732) $2,248,151 19%
Debt Coverage Ratioj8l 5.25 10.92
(1)Source:FY 2010-11,CAFR,Unrestricted Cash and Rate Stabilization Fund. Reserve Policy is$12.6 million.
(2)Actuals represent amounts billed based on Customer Information System report thru Dec 31,2011.
(3)Source:Power Resources Division.
(4)35%of Actual Expenditures thru Dec 31,2011, in Fund 31 -Admin&Consumer Services.
(5)Based on annual scheduled debt service payments for Series B and C,2003 Certificates of Participation.
(6)Capital Outlay Accts and Capital Improvement Project budget figures.
(7)Interest Income is transferred after fiscal year end if there is positive net income.
(8)Total Revenue less Cost for Purch'd Pwr,Trans,O&M,and A&G,divided bytdebt service. Minimum debt coverage
requirement is 1.10 per bond financing agreements. This is preliminary d/c ratio and it may vary with Disclosure
Report prepared after the audited financial reports are available,around December 2012.
108 .
Water Utility Quarterly Budget Report
2nd Quarter Ended Dec 31,2011
(UNAUDITED)
,
Consumption-CCF: 7,384,003 4,248,276 58%
Cash and Investments 0) $ 21,444,890 $ 22,695,371 106%
Budget Actu�l Thru Percent of
FY2009-2010 Budget Information
Qki Budget'
Revenues
Retail Billing Amounts izl $ 16,923,415 $ 9,315,888 55%
Other Revenues 3,981,140 547,702 14%
Interest Income 500,000 214 0%
Total Revenues $ 21,404,555 $ 9,863,803 46%
Expenses
Production 2,908,825.00 1,239,564 43%
Purchased Water 3,114,230 845,974 27%
Transmission and Distribution 2,634,675 1,177,984 45%
Customer Accounting and Sales(3) 4,059,174 1,376,631 34%
Administrative and Engineering 847,385 258,668 31%
Franchise Fees 338,470 191,612 57%
Subtotal Expenses $ 13,902,759 $ 5,090,433 37%
Capital Expenditures/Debt Service:
Debt Service Payments(4) $4,528,271 $ 2,264,135 50%
Capital Improvement Budget(5) 3,250,723 1,258,754 39%
Total Expenses (Less Bond Funding) $ 21,681,753 $ 8,613,322 40%
Adjustments
Transfers Out" $0 $0 0%
Total Expenditures and Transfers Out $ 21,681,753 $ 8,613,322 40%
Net Change in Cash(Negative) $ (277,198) $ 1,250,481 6%
Debt Coverage Ratio(7) 1.73 2.19
Notes:
(1)Source:Cash and Investments from FY 10-11 CAFR. Reserve Policy is$25 million.Note that
Land was acquired from Redevelopment Agency for$2.9 million. This reduced cash by$2,919,646.
(2)Based on Customer Information System Billing Amounts through Dec 31,2011.
(3)Customer Service Allocation to Water Fund,including 65%of Cost of CIS Upgrade Project.
(4)Principal and Interest on 2003 COP and 2006 Revenue Bonds thru 2nd quarter of fiscal year.
(5)Approved appropriations for multi-year projects,some of which are carryovers from prior year.
(6)Half of Interest Incomemaybe transferred by policy if there is positive net income. As of 12/31/2011,no
transfers have been made.
(7)Total Revenues less Production,Purch d Wtr,T&D,Cust Acct&.&A&G divided by Debt Svc Pymnts.
Minimum debt coverage requirement is 1.25 per bond financing agreements.
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fAZ-LJS.AAJ1161} awarn
INFORMATION ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERS OXTHEA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIE
DATE: FEBRUARY 27, 2012
SUBJECT: FEDERAL LEGISLATIVE UPDATE BY MORGAN MEGUIRE LLC
Southern California Public Power Authority (SCPPA) contracts with Morgan Meguire LLC to
monitor Federal legislation and regulations. Given American Public Power Association (APPA)
Washington DC rally on March 12, 2012, and that this is a Presidential election year, staff
thought attached legislative update by Morgan Meguire might be of interest to the Utility Board.
Some topics covered by attached "February" report include the following:
• Congressional Outlook, including President Obama's perspective on energy issues
• Energy Update, including GOP Energy Package Heading for the House Floor
• Energy Tax Incentives, including report on Senate Finance Panel examining tax issues
• Cyber Security, including bill passed by House regarding same
• Dodd-Frank Update, including related clean up legislation
• Nuclear, including subcommittee hearing report on Nuclear Waste
• Water Update, including activities to review Water Storage Shortage
• Federal Agency Updates, including updates related to FERC, EPA and DOE
Morgan Meguire provides these reports monthly to SCPPA members.
Prepared by:
Cary Kalscheuer, Assistant to the Director of Utilities
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a
Morgan Meguire LLC
Memorandum
TO: Bill Carnahan, Executive Director
FROM: Lori Pickford, Executive Vice President
DATE: February 7, 2012
RE: February Monthly Legislative Report
I. Congressional Outlook
The House returned on Jan. 17 and the Senate on Jan. 23, following their winter recess. The
President gave his annual State of the Union (SOTU) address on Tuesday, Jan. 24 (see details
below).
On February 13, the President is expected to release his Fiscal Year 2013 (FY13) budget request,
instead of Feb. 6. By the law, the budget is supposed to be sent to Congress on the first Monday
in February. However, the Administration, which is statutorily obligated to meet the strict
spending caps agreed to with Congress last August in negotiations on the debt ceiling, needed
extra time to revise its FYI 3 budget request to meet the spending caps.
Morgan Meguire has heard that the President will include in the budget a proposal from the
"jobs" bill the Administration sent to Congress last year, which would limit the deductibility of
tax exempt bonds from taxable income above a certain threshold, which would affect the market
for such bonds. Preservation of tax exempt bonds is a critical issue for SCPPA and public power
in general and Morgan Meguire will let SCPPA know when the budget document is released.
Most in Washington expect the second session of the 112`h Congress to be much like the first:
legislative gridlock and political messaging aimed at the 2012 elections. Battles over the deficit
and federal spending are expected to continue as both parties posture for the 2012 elections.
Republicans and Democrats alike think that passage of a longer- term payroll tax extension is
"must do" legislation and, as such, it may become a Christmas tree onto which numerous
legislators try to hang their favorite ornaments. Energy issues, in general, are expected to be
"wedge" issues - used by both parties to stake out positions they hope will help them get votes in
November.
Obama Highlights Energy Production and Clean Energy in Address to Congress
On Tuesday, Jan, 24, President Obama gave his third State of the Union address to a joint session
of Congress.
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Stealing a page from the GOP playbook, Obama called for an "all of the above" energy strategy
that develops all available sources of American energy. "This commitment includes the safe and
responsible production of our oil and natural gas resources. Today, American oil production is at
the highest level in eight years, and last year we relied less on foreign oil than in any of the past
16 years," he said.
In the speech, President Obama laid out a "Blueprint for an America Built to Last," underscoring
his commitment to oil and gas exploration, but also stressing the need to "double-down" on clean
energy in the United States. The Blueprint calls for safe shale gas development and increased
natural gas transportation, as well as additional R&D through the Advanced Research Projects
Agency-Energy (ARPA-E), a clean energy standard (CES), clean energy tax incentives for
manufacturing and renewable development, opening public lands for private renewable
development, and committing the Navy to secure "cost neutral" renewables.
Continuing a theme he sounded last year, the President admitted that some rules are "outdated,
unnecessary, or too costly," and said he has ordered every federal agency to "eliminate rules that
don't make sense."
Ten days earlier, President Obama announced plans to restructure and consolidate several
government agencies. He focused on several offices within the Commerce Department he
believes are duplicative. In the White House announcement he said he would combine several
trade and economic development offices into a single entity to help businesses thrive, and will
move the National Oceanic and Atmospheric Administration from the Commerce Department to
the Interior Department.
He asked Congress to give him the authority he needs to achieve these consolidations, but does
not plan to submit such legislation himself. Although the idea of reducing the size of the federal
government is popular with Congressional Republicans, it remains to be seen whether they will
provide any direction or assistance on this initiative.
To review a copy of President Obama's SOTU speech, click here.
II. Energy Update
GOP Energy Package Heading for House Floor
During a Feb. 1 House Natural Resources Committee markup, Chairman Doc Hastings (D-WA),
in near-party line votes, advanced three energy bills that would open more federal waters to oil
and gas production, increase leasing of oil shale, and allow oil drilling in the Arctic National
Wildlife Refuge.
Although it will face Democratic opposition in the House and is unlikely to go anywhere in the
Senate, the package will be part of Speaker John Boehner's (R-OH) broader"American Energy
and Infrastructure Jobs Act," expected on the floor this month, which uses energy production
and other revenue to pay for highway projects.
The legislation "creates new jobs, brings certainty for small businesses that depend on affordable
energy and generates new revenue that can be used to build roads and infrastructure projects to
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create even more American jobs," said Hastings. "Unlocking our nation's energy resources starts
a wave of economic benefits and job creation that will positively touch nearly every aspect of our
economy."
However, the fiscally-conservative and well-funded Club for Growth has urged opposition to the
bill, also saying that votes on the measure would be part of the organization's 2012 scorecard.
The move is likely to cause conservatives to reconsider their support for the bill. "Simply put,
this is a massive 846-page bill that doesn't cut any spending at all,"the group said in a release.
"Indeed, it spends at least $30 billion more by supplementing fuel taxes with additional revenue
from other sources."
Sponsors Seek Support for Hydropower Bill
Rep. Cathy McMorris Rodgers (R-WA), with co-sponsor Rep. Diana DeGette (D-CO), is
circulating a "Dear Colleague" letter to House Members seeking cosponsors of H.R. 3680, the
"Hydropower Regulatory Efficiency Act. "
H.R. 3680 would increase the size of small hydro projects on existing dams, from 5 MW to 10
MW, for which FERC may grant exemption from licensing requirements. The bill would also
automatically exempt conduit hydro projects of not more than 5 MW from the FERC licensing
process, including those on canals, aqueducts, or man-made agricultural water conveyances, and
give FERC discretion to grant an exemption for such projects up to 40 MW. Currently, FERC
has discretion to exempt only conduit projects up to 15 MW; there are no automatic exemptions.
The bill would also instruct FERC to investigate the feasibility of a two-year licensing process
for hydro installations at closed loop pumped storage projects and non-powered dams, and would
allow the Commission to extend a preliminary hydro permit for not more than two years.
II1. Energy Tax Incentives
Senate Finance Panel Examines Tax Extenders and Tax Reform
On Jan. 31, the Senate Finance Committee held a hearing entitled "Extenders and Tax Reform:
Seeking Long Term Solutions," featuring testimony from economists and the chief tax counsel to
the Chamber of Commerce. Witnesses and Senators discussed what would become of the more
than 100 expiring tax provisions, generally agreeing that the temporary nature of certain tax
credits impedes economic growth. Witnesses also discussed the need for an in-depth discussion
on broad tax reform, where each credit would be evaluated and either made permanent or
jettisoned for overall lower tax rates. Witnesses also supported, in varying degrees, the need to
pass this year a tax "extenders" bill to encourage jobs, domestic investments and manufacturing,
and allowing time for the larger debate on tax reform to come together in the next few years.
Chairman Max Baucus (D-MT) and Ranking Member Orrin Hatch (R-UT) noted that there are
currently 132 expiring provisions in the tax code and that that number has tripled since 1998.
More than 60 tax credits expired at the end of 2011, with a total cost of$38 billion to extend.
Many Members and panelists pointed to the expiring Production Tax Credit (PTC) for wind as
particularly damaging to the wind industry.
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All panelists and Senators present agreed that comprehensive tax reform is necessary to avoid the
uncertainty of repeated extensions, but differed on whether the extenders package currently
before the Committee should be taken up. Sen. Maria Cantwell (D-WA) argued that the
extenders package should not be "held hostage" by the idea of tax reform, something that is
likely years away from realization. Baucus, Cantwell and other strong renewables supporters are
likely to try to add an extension of the PTC to the "must pass" payroll tax cut extension now
being negotiated between the House and Senate.
In a related development, Govs. Terry Branstad (R-IA) and Sam Brownback (R-KS) sent Feb. 1
letters urging extension of the PTC to all 20 Members of the House-Senate payroll tax cut
conference committee. The governors said that leading production developers and
manufacturers are canceling plans for 2013 and "wind development will grind to [a] halt due to
the uncertainty of a PTC extension."
The Republican governors' letter appeared to have little effect on conference committee
members Jon Kyl (R-AZ) and John Barrasso (R-WY). "They're not here trying to slog through
the rest of this stuff," Kyl told press. "We've got a job to do and we've got to get that done
before we do anything else." Barrasso wasn't any more encouraging. "It wasn't on the agenda
today. It's not on the agenda tomorrow," he said.
IV. Cyber Security
House Panel Passes Cyber Bill; Senate Gearing Up
There will be a flurry of action on cyber security bills in both the House and Senate early this
session, but it remains to be seen whether any cyber bills will be enacted this year.
The House of Representatives does not favor a comprehensive approach to cyber security
legislation. Instead, several committees, each of which has a slice of cyber security jurisdiction,
will advance issue-specific or sector-specific bills. These bills may be assembled in a package
for House floor consideration.
In a Feb. 1 markup, the Homeland Security Subcommittee on Cybersecurity, chaired by Rep.
Dan Lungren (R-CA), favorably reported to the full Committee the "Promoting and Enhancing
Cybersecurity and Information Sharing Effectiveness Act" (H.R. 3674). The "PrECISE Act"
was introduced by Lungren in December, along with full Committee Chairman Peter King (R-
NY) and nine other Members, including Democrats.
H.R. 3674 authorizes the Department of Homeland Security (DHS) to conduct an evaluation of
cybersecurity risks to critical infrastructure and to make that assessment available to owners and
operators of critical assets in each sector. DHS would also be tasked with collecting internally-
recognized, consensus-developed, risk-based performance standards and developing market
based incentives to encourage adoption of those standards. Sector specific agencies, in
consultation with DHS and appropriate private-sector organizations, would then undertake a
public process to propose inclusion of those risk-based standards in the regulatory regime that
applies to each sector.
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Earlier versions of the Lungren bill gave DHS a much larger regulatory role, which the electric
sector coalition did not endorse. After publication of the recommendations of the Republican
Task Force on Cyber Security, the bill was revised to eliminate a direct regulatory role for DHS.
The current bill would also establish the National Information Sharing Organization (NISO), a
private-sector-controlled, not-for-profit organization to facilitate best practices, provide technical
assistance, and enable the sharing of cyber threat information across critical infrastructure and
with the federal government, while also protecting privacy and civil liberties.
H.R. 3674, as amended, will now be sent to the Full Homeland Security Committee for
consideration.
The Lungren Subcommittee action follows recent action by the House Intelligence Committee,
which approved Chairman Mike Rogers' (R-MI) bill (H.R. 3523) on Dec. 1. H.R. 3523 is a
fairly narrow bill designed to remove barriers that prevent private firms from sharing information
with the government on cyber threats and incidents. It would also remove any legal liability
associated with such sharing, and favors voluntary information sharing and industry incentives
over mandates.
These recent actions by the House Intelligence and Homeland Security Committees may increase
pressure on the House Energy and Commerce Committee to proceed to mark-up on the electric
sector-specific GRID Act.
In the Senate, Majority Leader Harry Reid's (D-NV) effort to bring a comprehensive cyber
security bill to the floor before the President's Day recess is encountering resistance. Some
Republican Senators are opposed to taking a bill directly to the floor without committee
consideration. They are also concerned about private sector opposition to the still-evolving bill.
On Jan. 30, the Chamber of Commerce sent a letter to Reid and Minority Leader Mitch
McConnell (R-KY), citing serious concerns about the Senate bill's substance and the process the
leadership is proposing. The Chamber was particularly critical of provisions in the bill that
would establish a DHS regulatory regime to identify critical infrastructure, set standards for
protection of those assets and enforce those standards. "The Chamber believes that a regulatory
program would become highly prescriptive in practice and thus counterproductive to effective
cybersecurity—due in large part to a shift in businesses' focus from security to compliance," the
letter said.
The Chamber said that any cyber security legislation should be narrowly drawn to address:
improving information sharing and protection of information; spurring cyber security R&D;
harmonizing information security programs across government civilian agencies, raising public
awareness and encouraging international cooperation against cybercrime.
Also on Jan. 30, the Ranking Republicans on the Senate Committees on Energy and Natural
Resources (ENR), Commerce, Judiciary and Intelligence published an OpEd in POLITICO that
sounded concerns similar to those in the Chamber letter.
If the comprehensive bill fails in the Senate, we are likely to see an effort by Senate Energy and
Resources Committee Chairman Jeff Bingaman (D-NM) to take the committee-approved GRID
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Act to the floor instead. The electric utility industry is opposed to provisions in that bill that
would provide FERC with broad new authority over cybersecurity vulnerabilities, and bring
distribution facilities under FERC and NERC jurisdiction for cyber security purposes.
V. Dodd-Frank Update
House Agriculture Reports Dodd-Frank Changes
On Jan. 25, the House Agriculture Committee reported six bills to amend the Dodd-Frank Act.
The measures all passed by bipartisan voice vote.
At the start of the hearing, Chairman Frank Lucas (R-OK) said that the bills do not make
dramatic changes to Dodd-Frank, but instead are "balanced proposals that ensure the legislation
is implemented in the manner Congress intended." Lucas is hoping to win support from
Committee Democrats for the bills.
Despite this overture, Ranking Member Collin Peterson (D-MN) acknowledged that the
Chairman has the votes to advance the bills, but encouraged the Committee to hold off on acting
until regulators at the Commodity Futures Trading Commission (CFTC) completed the
rulemaking process. Peterson offered an amendment, agreed to by voice vote, to each bill that
would allow the CFTC to move ahead with their rulemaking to ensure that the Commission
would'not have to start the process over if any of the legislation passes.
The bills approved include several pieces of legislation that consumer-owned utilities, which
have been working with the energy end-users' coalition, are pleased to see advance.
They include:
• H.R. 1840— To require the CFTC to assess the costs and benefits of proposed actions;
• H.R. 3527 —Protecting Main Street End-Users from Excessive Regulation. Clarifies the
definition of swap dealer to ensure that energy and agriculture end-users are not
misclassified and subject to costly new regulatory requirements;
• H.R. 2682 —Business Risk Mitigation and Stabilization Act. Ensures end-users can
continue to use derivatives to manage business risks without being subject to costly
margin requirements;
The end-users coalition is hopeful that the legislation will guide the CFTC as they work to
finalize rules on what is a swap and who constitutes a swap dealer as well as margin
requirements. CFTC is expected to come forward with its "Swap Dealer" definition, which will
determine how other rules impact electric utilities, next Wednesday. Other important rules are
expected shortly thereafter.
VII. Nuclear
House Energy Subcommittee Holds Hearing on Nuclear Waste Report
The House Energy and Commerce Subcommittee on Energy and the Economy held a Feb. 1
hearing on the final report of the President's Blue Ribbon Commission on America's Nuclear
Future (BRC), released Jan. 26. BRC co-chairmen, former Rep. Lee Hamilton (D-IN) and
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former National Security Advisor Brent Scowcroft, testified that the nation's current waste
policy has been troubled for decades and has now reached an impasse with the decision to halt
work on the Yucca Mountain site. A new strategy is needed not only to address the costs and
damages to the waste management policy, but also "to avoid burdening future generations with
the entire task of finding a safe, permanent solution for managing hazardous nuclear materials
they had no part in creating,"the BRC said.
The final BRC report includes eight major recommendations for action to develop a new strategy
to manage nuclear waste:
• a new, consent-based approach to siting future nuclear waste management facilities;
• a new organization dedicated solely to implementing the waste management program and
empowered with the authority the resources to succeed;
• access to the funds nuclear utility ratepayers are providing for the purpose of nuclear
waste management;
• prompt efforts to develop one or more geologic disposal facilities;
• prompt efforts to develop one or more consolidated storage facilities;
• prompt efforts to prepare for the eventual large-sale transport of spent nuclear fuel and
high-level waste to consolidates storage and disposal facilities when such facilities
become available;
• support for continued U.S. innovation in nuclear energy technology and for workforce
development; and
• active U.S. leadership in international efforts to address safety, waste management,
nonproliferation, and security concerns.
The hearing involved a lot of discussion about the Administration's decision to terminate the
Yucca Mountain, NV disposal site, even though the BRC report did not address Yucca Mountain
specifically. Concern about the Yucca decision was not limited to Committee Republicans,
Subcommittee Ranking Member Gene Green (D-TX) said, "I have supported the use of Yucca
Mountain in the past and still believe it's a terrible waste of taxpayer dollars to have this $12
billion facility sitting unused in the desert." Rep. Jay Inslee (D-WA) also noted his
disappointment that the U.S. has spent billions of dollars over 30 years on the site, only to
abandon the project. The U.S. currently has 65,000 metric tons of nuclear waste, which is
growing by about 2,000 metric tons every year.
On Feb. 2, the Senate ENR Committee held a similar hearing on the BRC report, with Hamilton,
Scowcro$ and BRC Member and former ENR Chairman, Pete Domenici (R-NM) as witnesses.
Committee members, who are now charged with implementing the report recommendations that
require legislation, had many questions for the panel, including how a consent-based siting
process would work, how to protect the new waste organization from political pressure, and
whether spent fuel reprocessing could mitigate or solve the siting dilemma.
VIII. Water Update
House Water and Power Panel to Review Water Storage Shortage
On Feb. 7, the House Subcommittee on Water and Power will hold an oversight hearing to
examine "Regulatory and Bureaucratic Barriers to New Surface Storage Infrastructure."
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Committee staff says that the hearing will not focus on specific projects or state issues, but rather
on the West-wide need for additional water storage.
"Increased population, environmental lawsuits, duplicative regulations and a growing demand
for food supplies have strained the current water supply system, requiring additional dams and
reservoirs to be built for job creation and economic growth," Chair Tom McClintock's (R-CA)
press release said. "Unfortunately, bureaucratic red tape and burdensome regulations have
stopped or delayed much-needed construction of additional surface water storage throughout
much of the West."
Since coming to Congress, McClintock has steadfastly insisted that more large dams are needed,
but he is has not attracted much support from other Republicans on the Committee for this
position. Instead, the Committee has advanced two bills—Rep. Tipton's (R-CO) H.R. 2842 and
Rep. Smith's (R-NE) H.R. 795, designed to promote development of small hydro and conduit
hydropower projects.
Although staff said that a witness list is not final, the Bureau of Reclamation is likely to be on the
panel.
IX. Federal Agencies Update—FERC, EPA, DOE
Obama Nominates Clark to FERC; Sieminski to EIA
On January 24, President Obama nominated Tony Clark as FERC Commissioner, to fill the seat
recently vacated by Commissioner Marc Spitzer. Clark previously served as a Commissioner to
the North Dakota Public Service Commission, and most,recently served as President of the
National Association of Regulatory Utility Commissioners (NARUC). Sen. John Hoeven (R-
ND) recommended him to Minority Leader Mitch McConnell (R-KY), who submitted Clark's
name for the Administration's consideration.
r
On Feb. 2 the President nominated FERC Commissioner John Norris to a second term.
According to Senate Energy and Natural Resources Committee staff, the Clark and Norris
nominations may be paired in a single hearing. Such a hearing would likely invite questions
from Senators on a range of issues, ranging from Order 1000 to incentive rates of return, to
FERC's role in electric reliability and beyond.
The President also nominated Adam Sieminski to be the Administrator of DOE's Energy
Information Administration (EIA). Sieminski is currently the chief energy economist for
Deutsche Bank, where he has served since 2005. Prior to that, he was the director and energy
strategist for Deutsche Bank's global oil and gas equity team. If confirmed, Sieminski would
take over for acting administrator Howard Gruenspecht.
FERC Issues White Paper on Impact of EPA Regulations on GRID Reliability
On Feb. 30, the Federal Energy Regulatory Commission (FERC) issued a white paper on the
Environmental Protection Agency's (EPA's) proposal to allow electric utilities a fifth year to
meet new Mercury and Air Toxics Standards (known as the utility MACT rules), if needed to
meet critical reliability concerns. Comments on FERC's white paper are due on Feb. 29.
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While FERC plans to advise the EPA on which power plants are critical to electric grid
reliability and should therefore receive a one-year extension to meet utility MACT rules, the
Commission is unsure how much it should investigate power plants' reliability claims when the
plants are seeking that extension. For example, FERC asks whether it should "accord some level
of deference [possibly similar to appellate review] to the planning authority's analysis" of the
project, or should it conduct a totally new analysis, outside of what utilities planning authorities
have already done.
FERC has legal authority over electricity reliability issues, and wants to quickly outline the
process for reviewing requests for an extra year to comply. In the white paper, FERC suggests
utilities file the same information on why they need an extension and what the reliability issues
are to both FERC and EPA. After reviewing the information, FERC will submit written
comments on each request to EPA, it says. EPA, however, will have the final say on granting the
utility an extension to meet its rules, FERC said.
FERC's action will likely contribute to the tension between Congressional Republicans and the
Obama Administration over whether new EPA rules will compromise electric grid reliability.
For months, Senate ENR Committee Ranking Member Lisa Murkowski (R-AK) has been raising
concerns about reliability impacts of the new regulations, and she-is in the process of developing
legislation to provide utilities with a"safety valve" if they incur EPA penalties as a result of
complying with a FERC order to run generation needed for reliability. Rep. Pete Olson (R-TX) is
preparing a similar bill in the House.
EPA Online Tool to Track Water Pollution, Greenhouse Gases
EPA has released a new online tool to allow the public to search for data on water pollution
discharges. The data can be sorted by location, industry sector, company and pollutant.
Earlier this month, EPA published its online tool to search greenhouse gas emissions, with power
plants listed as the largest emitters in 2010.
Audit of DOE Smart Grid Grant Program Shows Cyber Security Flaws
The DOE Office of the Inspector General (IG), Office of Audits and Inspections, issued a report
on the Department's management of the Smart Grid Investment Grant (SGIG) Program, citing
flaws in nearly a third of the grant recipients' ability to meet the agency's cyber security
requirements.
The SGIG program provided $3.5 billion in grant funding in 2009, as part of the Recovery Act,
to facilitate the installation of state-of-the-art information technologies and, ultimately, improve
grid reliability and enable consumers to reduce the amount of energy used. DOE awarded all of
its available grant funds, which covered only 50 percent of each project's, to 99 recipients, with
awards ranging in value from $397,000 to $200 million.
Under the grant program, DOE required applicants to submit cyber security plans that, at a
minimum, describe their approaches to detecting, preventing and recovering from a breach. The
Inspector General's report said that 36 of 99 cyber security approaches submitted as part of the
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grant application lacked one or more required elements. "In our review of security plans, we
noted that the plans did not always include sufficient information related to risk assessments
and/or other important elements, and that they did not fully address many of the weaknesses
initially identified by the Department," it reported. Moreover, the IG's review found instances in
which DOE approved plans that did not include "a number of security practices commonly
recommended for federal government and industry systems."
The IG found that a number of these issues were a result of trying to get the program up and
running too quickly, and wanting to get the grants disbursed to help create jobs as quickly as
possible. The report also highlighted a number of positive actions DOE has undertaken in
administering the program, but made several recommendations that, if fully implemented, they
believe should help improve DOE's ability to effectively administer and monitor the SGIG
program.
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MON
AZUSA
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INFORMATION ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE 9A UTILITY
BOARD
FROM: GEORGE F. MORROW,DIRECTOR OF UTILITIES
DATE: FEBRUARY 27, 2012
SUBJECT: WATER SUPPLY UPDATE
As of February 22, 2012, the water supply outlook in Southern California continues to worsen.
To date, the Los Angeles area has received a total 6.46 inches of precipitation since September.
This is 9.9 inches less than the year-to-date average of 16.36 inches. In February measured
precipitation is 0.82 inches compared to a historic February average of 5.09 inches. The worst
rain year in history accumulated a total of 8.3" of rainfall for the entire fiscal year of 2006-2007.
Historically the average annual rainfall for the Los Angeles area is 23.06".
Statewide the rainfall situation is much the same and is reflected by the snowfall in the Sierras
which is 37 percent of normal snowpack for this time of year. Current snowpack is 23 percent of
the annual average snowpack April 1 which is considered the official end of the rain and snow
season in California. Meteorologists are pessimistic that snowfall will increase significantly as
the winter snow season progresses.
In light of the current snow pack conditions, the California Department of Water Resources has
lowered the State Water Project allotment to 50% from the initial allotment of 60%. The State
Water Project allotment determines how much water will be allotted to State Water Project
contract agencies such as Metropolitan Water District of Southern California (MWD) and our
own San Gabriel Valley Municipal Water District (SGVMWD) which supplies water directly to
the Cities of Azusa, Siena Madre, Monterey Park and Alhambra and has an allotment of 28,800
acre-feet annually-- 14,400 acre-feet is available so far this year.
On the bright side, last fiscal year's rainfall, particularly in the month of December, 2010, gave
California a respite from the prior dry years and allowed State and local water agencies to fill all
of their water reservoirs to overflow from their low, and in some cases, dry conditions at the end
of fiscal year 2009-10. The Colorado River reservoirs, Lake Powell and Lake Mead, made a
comeback from near emergency status and assured Las Vegas and the Colorado River agencies
of Arizona and MWD of Southern California of water this season. Locally, MWD has filled all
of its local reservoirs including the massive Diamond Valley Reservoir and will be able to
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Water Supply Update
February 27, 2012
Page 2
provide water to its sub-agencies including Upper San Gabriel Valley MWD which supplies
water to most of the water purveyors in the San Gabriel Valley.
Azusa Light & Water will be receiving water deliveries from SGVMWD in May and MWD
supplies treated water to the southern portion of the ALW service area, and water is still
available from the San Gabriel River dams for the ALW Water Treatment Plant. With wise use
of this water, ALW will be able to make it through this current dry year.
Prepared by: Chet F. Anderson, P.E.,Assistant Director of Water Operations
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14.00
B Oct
12.00
■Nov
10.00 O Dec
O Jan
8.00 ■Feb
O Mar
6.00 N Apr
4.00
■Jun
2.00 j
LL
May
aJul
OAug
0.00 O Sep
2005/08 2006/07 2007/08 2008/09 2009110 2010/11 2011/12
MONTHLY RAINFALL IN THE LOS ANGELES AREA
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Fro
• Arr
AZUSA
CMI i 'n41N
INFORMATION ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERSOFT USA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES
DATE: FEBRUARY 27, 2011
SUBJECT: UPDATE ON ELECTRIC VEHICLE AND CHARGING STATIONS
Last year the Azusa Utility Board authorized staff to solicit proposals (RFP) for electric vehicle
public charging stations in City of Azusa.
The initial phase calls for two charging units to be constructed at the City Hall and Light &
Water parking lots. In the second phase, up to five additional charging stations are planned for
selected community sites, subject to interest/value, space availability and convenient utility
service at these premises.
Staff issued an RFP for the acquisition of charging stations in December 2011 and is currently
reviewing the three proposals that were submitted. In summary, the average cost for electric
vehicle charging stations, excluding services specific to a vendor, is estimated at about $7,000
per charging unit. Staff will report to the Utility Board at a later date with detailed results and
recommendations.
In conjunction with the electric vehicle charging stations, staff will be recommending the
purchase/lease of two plug-in electric vehicles for utility research and demonstration purposes.
The Department has identified the opportunity to replace a recently surplused hybrid electric
vehicle with a plug-in electric vehicle as a pooled vehicle at the City Hall location. A second
demonstration vehicle is planned at the Light & Water administration building.
This report is for information purposes only and no action is required at this time.
Prepared by: Federico Langit, Assistant Director of Electric Operations
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