Extension of the Mandatory Tender and Remarketing of the 2006, 2013A, and 2013B Rose Bowl Lease Revenue Bonds Presented by Vic Erganian Deputy Finance Director/City Treasurer January 22, 2018 Finance Committee/City Council

Background In 2006, Pasadena Public Financing Authority issued $47.3 million variable rate bonds to refund its 1991, 1996 COPs and provide additional funds to complete capital improvements to the stadium and other facilities. In April 2011, the outstanding balance of the bonds were directly purchased by MUFG Union bank. In January 2013, the bonds were refunded and restructured to generate additional $30 million (taxable and tax-exempt) to complete the Rose Bowl renovations and privately placed the bonds (total of $53.965 million) with MUFG Union Bank for a term of five years expiring on 1/2/2018.

Background Impact of the new tax law on pricing the bonds Only two banks provided pricing with non-identical terms MUFG agreed to hold the bonds past the mandatory tender date of 1/2/2018 at the negotiated price subject to City Council’s approval on 1/22/18. The recommendation is to remarket the bonds and place them with MUFG at the new price for a term of 1 year expiring on 1/2/2019

Pricing of the bonds The remarketed bonds Tax-Exempt portion 38,840,000 Taxable portion 13,525,000 Total remarketed bonds $52,365,000 Tax-Exempt bonds will have a rate equal to 67% of the one month LIBOR (London Interchange Bank Offered Rate) plus 80 basis points This equates to an interest rate of 1.83% and 0.08% higher than the prior rate formula

Pricing of the bonds The taxable bonds will have a rate of 2.70% compared to the prior 1.90% rate.

Cost of the proposed financing The weighted average cost of this proposed financing in today’s interest rate market will be 2.04%. Including the interest rate swap related to the variable rate portion of the bonds, the weighted average cost to the Rose Bowl will be 2.63%.

Recommendation Find that the proposed action is not a project subject to California Environmental Quality Act (CEQA) as defined in Section 21065 of CEQA and section 15378 of the State CEQA Guidelines and, as such, no environmental document pursuant to CEQA is required for the project; and

Recommendation Adopt a resolution of the City Council of the City of Pasadena and a resolution of the Pasadena Public Financing Authority authorizing execution and delivery of supplemental bond indentures and one or more continuing covenant amendments with MUFG Union Bank N.A., relating to the Pasadena Public Financing Authority Variable Rate Demand Lease Revenue Bonds (Rose Bowl Refinancing and Improvement Projects) Series 2006, the Pasadena Public Financing Authority Variable Rate Demand Lease Revenue Bonds (Rose Bowl Renovation Project) Series 2013A (Tax- Exempt), and the Pasadena Public Financing Authority Variable Rate Demand Lease Revenue Bonds (Rose Bowl Renovation Project) Series 2013B (Taxable), and authorizing certain other actions relating thereto;