COUNTY OF SAN MATEO

Inter-Departmental Correspondence

County Manager's Office

DATE:

August 30, 2004

BOARD MEETING DATE:

September 14, 2004

TO:

Honorable Board of Supervisors

FROM:

Paul T. Scannell, Assistant County Manager

SUBJECT:

Public Hearing and Approval of California Statewide Communities Development Authority Revenue Bonds for the benefit of Italian Gardens, Inc.

RECOMMENDATION:

Conduct a public hearing regarding the issuance by California Statewide Communities Development Authority (“CSCDA”) of bonds for the benefit of Italian Gardens, Inc. (“IGI”) and financing the acquisition, improvement and equipping of certain facilities located within the County of San Mateo. Following the hearing, adopt a resolution approving such bond issuance.

BACKGROUND:

The Mid-Peninsula Housing Coalition (“MPHC”), through its affiliate, IGI, proposes to acquire approximately 50.74% of an existing office building located at 303 Vintage Park Drive, Foster City, California, to be owned by the IGI and to be used by MPHC as its main office (the “Project”).

DISCUSSION:

IGI has applied to CSCDA for its assistance in financing the Project through the issuance of revenue bonds in an amount not to exceed $5 million. CSCDA is a joint exercise of powers authority consisting of numerous California counties, cities and special districts, including the County of San Mateo. CSCDA is authorized in its Joint Exercise of Powers Agreement (“Agreement”) to assist California charitable organizations through the issuance of revenue bonds. Said Agreement also requires a public approval by each participating member of CSCDA in which any portion of the project being financed is located. The federal tax law also requires a public hearing to be conducted by a government unit having jurisdiction over the area in which the financed facility is located and approval by the governing body prior to the issuance of tax-exempt bonds. The Bonds will be privately placed with Citibank, N.A.

Quint & Thimmig LLP, bond counsel to CSCDA, has prepared and caused to be published the required notice of public hearing. Quint & Thimmig LLP also prepared the form of resolution submitted to the County of San Mateo Board of Supervisors for its consideration.

The County is not liable for payment with respect to the bonds.

VISION ALIGNMENT:

This item keeps the commitments of responsive, effective and collaborative government through goal number 22: County and local governments effectively communicate, collaborate and develop strategic approaches to issues affecting the entire County.

FISCAL IMPACT:

By holding this hearing and approving the Bonds the County does not obligate itself in any way for the payment of debt service on the Bonds. The principal and interest on the Bonds will be paid solely from the payments to be made by IGI, supported by a guaranty of MPHC. The County is not obligated to pay, and is not liable for, the payment of the Bonds.