CC Resolution 12102RESOLUTION NO. 12102
BEING A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CAMPBELL AUTHORIZING THE CITY MANAGER TO EXECUTE
SUBORDINATION AGREEMENT WITH RIVER CITY BANK
WHEREAS, the Silicon Valley Clean Energy Authority (SVCEA), a partnership of
12 local governments, will bring its residents and businesses 100% carbon free
electricity at lower costs when it begins operation in 2017;
WHEREAS, the City of Campbell officially joined the SVCEA in February 2016;
WHEREAS, to fund the Community Choice Energy (CCE) program pre-launch
activities and the negative cash flow in the first few months of operation, SVCEA
requires credit capacity until sufficient ratepayer revenues are received;
WHEREAS, as a member of SVCE, the City appropriated $150,000 in the FY
2016 Mid Year Update towards the initial studies and subsequent activities;
WHEREAS, the Joint Powers Authority (:IPA) agreement requires that these
contributions be repaid within four years of the effective date of the JPA
formation, or March 31, 2020;
WHEREAS, a team from the Cities of Sunnyvale, Mountain View, Cupertino,
Morgan Hill, the County of Santa Clara (County), SVCEA Chief Executive Officer
and SVCEA consultants, developed a Request for Proposals and evaluated the
financing options for the SVCEA;
WHEREAS, SVCEA has identified the need for up to $2.0 million in a Non-
Revolving Line of Credit (NRLOC) for pre-launch activities and up town $18.0
million Revolving Line of Credit (RLOC) to fund reserves and negative cash flow
associated with power supply acquisition;
WHEREAS, initially, it was anticipated that the member agencies may need to
provide some form of limited guarantee to the selected bank, as has been the
case for all other CCE's;
WHEREAS, River City Bank (RCB), however, required guarantees for only $2.0
million associated with the NRLOC
WHEREAS, the agencies of Sunnyvale, Mountain View, Gilroy (charted cities)
and the County have agreed to provide this guarantee.;
WHEREAS, the Credit Agreement with RCB requires each agency agree to
subordinate the repayment for their share of the initial contribution, totaling $2.7
million, until the NRLOC is retired;
WHEREAS, both RCB credit facilities are projected to be repaid by SVCE within
12 months of operation;
WHEREAS, the SVCE Board approved -RCB banking services last September
2016 and approved the Credit Agreement on November 9, 2016;
WHEREAS, in order for RCB to make funds available post entering power supply
agreement in January 2017, it is necessary for all member agencies to approve
the subordination agreement.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of
Campbell does hereby authorize the City Manager to execute the Subordination
Agreement with River Ciry Bank for, and on behalf of, _the City of Campbell and
that the City Manager is hereby authorized to sign, and deliver, all necessary
documents in connection therewith for, and on behalf of, the City of Campbell.
PASSED AND ADOPTED this 12th day of January, 2017 by the following roll call
vote:
AYES: Councilmembers: Waterman, Cristina, Landry, Resnikoff
NOES: Councilmembers: None
ABSENT: Councilmembers: Gibbons
APPROVED:
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' abeth Gibbons, Mayor
ATTEST:
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Wendy o d, City Clerk