SUBJECT
Title
CONTINUED ITEM FROM 05/04/2021 (21):
NOTICED PUBLIC HEARING:
ISSUANCE OF REVENUE BONDS BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY FOR THE BENEFIT OF LA MAESTRA FAMILY CLINIC, INC., IN AN AGGREGATE AMOUNT NOT TO EXCEED $15,000,000 (DISTRICTS: 1, 2, 4)
Body
OVERVIEW
On May 4, 2021 (21), the Board of Supervisors continued the item to May 18, 2021.
The County has received a request from the California Municipal Finance Authority (“CMFA” or “Authority”) to conduct a public hearing as required by the Internal Revenue Code and to approve the Authority’s issuance of one or more series of revenue bonds in an aggregate principal amount not to exceed $15,000,000 (the “Bonds”), for the benefit of La Maestra Family Clinic, Inc. (the “Borrower”), a California nonprofit, public benefit corporation. The Borrower has applied for the financial assistance of the Authority to: (a) prepay an outstanding taxable loan which was incurred to finance a health clinic at 4066, 4074, 4082 Fairmount Avenue, in San Diego, California, (b) finance improvements to the Fairmount Building, (c) finance the acquisition and renovation of a building at 205-217 Highland Avenue, National City, California, and (d) refinance the acquisition and finance the renovation of a building at 181 Rea Avenue in El Cajon, California.
The Authority is authorized to assist in financing for nonprofit public benefit organizations or for-profit corporations with a public benefit project wishing to issue revenue bonds, including the Borrower. In order to initiate such a financing, the Borrower is asking the County of San Diego, a member jurisdiction in which the project resides to: (1) conduct a public hearing to satisfy the public approval requirement of Section 147(f) of the Internal Revenue Code; and (2) approve the Authority’s issuance of the Bonds. Although the Authority will be the issuer of the Bonds for the Borrower, the financing cannot proceed without the approval of an applicable legislative body.
Today’s recommendations will provide the Authority with the required authorization to pursue its determination to issue the Bonds on behalf of the Borrower for the Project.
RECOMMENDATION(S)
CHIEF ADMINISTRATIVE OFFICER
1. Pursuant to Section 147(f) of the Internal Revenue Code, hold a public hearing regarding the financing of the Project.
2. Adopt a Resolution entitled:
RESOLUTION OF THE BOARD OF SUPERVISORS OF THE COUNTY OF SAN DIEGO AUTHORIZING AND APPROVING THE FINANCING TO BE UNDERTAKEN BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY FOR THE BENEFIT OF LA MAESTRA FAMILY CLINIC, INC. IN AN AGGREGATE AMOUNT NOT TO EXCEED $15,000,000 FOR THE PURPOSE OF FINANCING AND REFINANCING THE ACQUISITION, CONSTRUCTION, IMPROVEMENT AND EQUIPPING OF HEALTH CLINICS AND CERTAIN OTHER MATTERS RELATING THERETO.
FISCAL IMPACT
If approved, the proposal will result in approximately $1,030 of unanticipated revenue to be used to reimburse the County for costs associated with this non-County financing.
The Borrower will be responsible for the payment of all present and future costs in connection with issuance of the financing. The County will incur no obligation of indebtedness as a result of these actions.
BUSINESS IMPACT STATEMENT
N/A
Details
ADVISORY BOARD STATEMENT
The Debt Advisory Committee, composed of the Assistant Chief Administrative Officer, the Deputy Chief Administrative Officer/Chief Financial Officer, Auditor and Controller, and the Treasurer-Tax Collector, concurs with this recommendation.
BACKGROUND
California Municipal Finance Authority (“CMFA”)
The California Municipal Finance Authority provides tax-exempt financing for qualified projects located throughout the State of California. The Authority’s mission is to support economic development, job creation, and social programs throughout the State of California. By assisting nonprofit corporations with various tax-exempt financing programs, the Authority is able to support programs that improve the health and welfare of California residents. The Authority finances a broad range of facilities including nonprofit projects such as education, health care and cultural facilities, affordable multi-family and senior housing, manufacturing facilities and equipment, solid waste, water, wastewater treatment facilities and infrastructure projects and government sponsored financing.
La Maestra Family Clinic, Inc.
La Maestra Family Clinic, Inc., doing business as La Maestra Community Health Centers (“La Maestra” or the “Corporation”), is a California nonprofit public benefit corporation. La Maestra was established in 1991 and owns and operates healthcare facilities in various communities of San Diego County, California. The Corporation has been providing programs and services to thousands of residents each year. The residents it serves are at or below the poverty level from the communities of City Heights, El Cajon and National City.
Project
The Borrower wishes to use the proceeds to: (a) prepay an outstanding taxable loan made to the Corporation which was incurred to finance a health clinic at 4066, 4074, 4082 Fairmount Avenue, in San Diego, California ($6,345,000), (b) finance improvements to the Fairmount Building ($71,000), (c) finance the acquisition and renovation of a building at 205-217 Highland Avenue, National City, California, for use by the Corporation as a new health clinic ($5,587,000), and (d) refinance the acquisition and finance the renovation of a building at 181 Rea Avenue in El Cajon, California, for use by the Corporation as a new health clinic ($2,997,000).
Public Benefit
With this financing, the Borrower will be able to better serve the community and continue to provide high quality healthcare for San Diego County.
County Involvement
Section 147(f) of the Internal Revenue Code requires that an applicable elected body, with respect to the Project, hold a public hearing and approve the issuance and delivery of the Bonds. The Board of Supervisors of the County of San Diego, as an applicable elected body, is requested to (1) hold a public hearing at which all those interested in speaking with respect to the financing of the Project can be heard and (2) approve the issuance of the Bonds. The Borrower shall be responsible for the payment of all present and future costs in connection with the issuance of the Bonds.
LINKAGE TO THE COUNTY OF SAN DIEGO STRATEGIC PLAN
Today’s proposed action supports the Operational Excellence Strategic Initiative in the County of San Diego’s 2021-2026 Strategic Plan by supporting and allowing the issuance of revenue bonds by CMFA for the La Maestra Family Clinic, Inc. to finance and refinance various health facilities located in San Diego.
Respectfully submitted,
HELEN N. ROBBINS-MEYER
Chief Administrative Officer
ATTACHMENT(S)
1. County Resolution
2. Notice of Public Hearing
3. CMFA Project Application for Bond
AGENDA ITEM INFORMATION SHEET
REQUIRES FOUR VOTES: ☐ Yes ☒ No
WRITTEN DISCLOSURE PER COUNTY CHARTER SECTION 1000.1 REQUIRED
☐ Yes ☒ No
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PREVIOUS RELEVANT BOARD ACTIONS: November 17, 2020 (26), Issuance of Revenue Bonds by the California Municipal Finance Authority for the benefit of La Maestra Family Clinic, Inc. in an aggregate amount not to exceed $14,500,000 (District: 4) |
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BOARD POLICIES APPLICABLE: N/A |
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BOARD POLICY STATEMENTS: N/A |
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MANDATORY COMPLIANCE: N/A |
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ORACLE AWARD NUMBER(S) AND CONTRACT AND/OR REQUISITION NUMBER(S): N/A |
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ORIGINATING DEPARTMENT: Finance and General Government Group |
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OTHER CONCURRENCE(S): |
Debt Advisory Committee |
CONTACT PERSON(S):
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Tanya Eames |
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Lauren Warrem |
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Name |
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Name |
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(619) 531-6225 |
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(619) 531-5686 |
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Phone |
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Phone |
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Tanya.Eames@sdcounty.ca.gov |
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Lauren.Warrem@sdcounty.ca.gov |
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E-mail |
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E-mail |