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RES-10828 Approval For Disclosure Procedures For Public Debt IssuancesRESOLUTION NO. 10828 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ORANGE APPROVING DISCLOSURE PROCEDURES FOR PUBLIC DEBT ISSUANCES AND RELATED CONTINUING DISCLOSURE OBLIGATIONS. WHEREAS, from time to time the City of Orange (the "City "), the Successor Agency to the Orange Redevelopment Agency, the Orange Housing Authority and other entities created by the City Council or for which the members of the City Council serve as the governing board or the legislative body, including joint powers agencies and special districts (the City, the Successor Agency, the Housing Authority and any such other entities being collectively referred to below as the "Public Agencies "), incur indebtedness (including but not limited to bonds, notes and certificates of participation) and, in connection therewith, prepare disclosure documents (a) describing the indebtedness for use in the offering and sale of the indebtedness or interests therein generally known as "official statements" or placement memoranda" (referred to in this Resolution as "Initial Disclosure Documents "); and (b) as required by continuing disclosure obligations entered into by the Public Agencies in connection with such indebtedness (referred to in this Resolution as "Continuing Disclosure Documents ") which typically are required to be filed with the Municipal Securities Rule Making Board's Electronic Municipal Market Access System (generally known as "EMMA "), and WHEREAS, to (a) ensure that Initial Disclosure Documents do not contain any material misstatements or omit to state information material to prospective investors in connection with their decision to purchase obligations of the Public Agencies, (b) ensue that Continuing Disclosure Documents filed with EMMA by the Public Agencies are timely filed, are accurate and are otherwise in accordance with continuing disclosure obligations of the respective Public Agencies, (c) ensure that material event notices and any other filings with EMMA in connection with debt obligations of the Public Agencies are accurate and comply with all applicable federal and state securities laws, and (d) promote best practices regarding the preparation of Initial Disclosure Documents and Continuing Disclosure Documents, it is appropriate for the City Council to adopt disclosure procedures for public debt issuances. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ORANGE HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS: Section 1. Disclosure Procedures To (a) ensure that Initial Disclosure Documents do not contain any material misstatements or omit to state information material to prospective investors in connection with their decision to purchase obligations of the Public Agencies, (b) ensure that Continuing Disclosure Documents Bled with EMMA by the Public Agencies are timely filed, are accurate and are otherwise in accordance with continuing disclosure obligations of the Public Agencies, (c) ensure that material event notices and any other filings with EMMA in connection with debt obligations of the Public Agencies are accurate and comply with all applicable federal and state securities laws, and (d) promote best practices regarding the preparation of Initial Disclosure Documents and Continuing Disclosure Documents, the City Council hereby adopts disclosure procedures for public debt issuances in the form attached hereto as Exhibit A. Section 2. Official Actions The Mayor, the City Manager, the Finance Director and the City Clerk, and any and all other officers of the City, are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all actions, including execution and delivery of any and all certificates, notices, consents and other documents which they, or any of them, may deem necessary or advisable in furtherance of the intent of this Resolution and the disclosure procedures hereby approved. Section 3. Effective Date This Resolution shall take effect immediately upon adoption. ADOPTED this 25 day of November, 2014 Teresa L Smith, Mayor, City of Orange ATTEST: Mary u y, City Clerk i y range i, MARY E. MURPHY, City Clerk of the City of Orange, California, do hereby certify that the foregoing Resolution was duly and regularly adopted by the City Council of the City of Orange at a regular meeting thereof held on the 25 day of November, 2014 by the following vote: AYES:COUNCILMEMBERS:Alvarez, Whitaker, Smith, Murphy, Bilodeau NOES:COUNCILMEMBERS:None ABSENT:COUNCILMEMBERS:None ABSTAIN:COUNCILMEMBERS:None Mary E. , City Clerk, City nge 2 EXHIBIT A DISCLOSURE PROCEDURES FOR PUBLIC DEBT ISSUANCES AND RELATED DISCLOSURE OBLIGATIONS I. INTRODUCTION A. Purpose These disclosure procedures (the "Procedures ") of the City of Orange (the "City "), are intended to (1) ensure that the City's Initial Disclosure Documents and Continuing Disclosure Documents (as such terms are defined in Section II A.2 below) are accurate and comply with all applicable federal and state securities laws, and (2) promote best practices regarding the preparation of the City's Initial Disclosure Documents and Continuing Disclosure Documents. For purposes of these Procedures, the "City" shall mean the City of Orange, California, the Successor Agency to the Orange Redevelopment Agency, the Orange Housing Authority and other entities created by the City Council of the City of Orange or for which the members of the City Council of the City of Orange serve as the governing board or the legislative body, including joint powers agencies and special districts. II. KEY PARTICIPANTS A. Disclosure Practices Working Group 1. Composition. A Disclosure Practices Working Group (the "Disclosure Working Group ") will have general oversight over the entire initial and continuing disclosure process. Members of the Disclosure Working Group shall be appointed from time to time by the City Manager (in consultation with the Finance Director) and shall consist of persons relevant to the disclosure process. The initial Disclosure Working Group shall include the following persons: a) the Finance Director; b) the Disclosure Coordinator (as described below); c) the City Attorney; and d) and any other individuals appointed by the City Manager. The Disclosure Working Group shall consult with finance team members for each applicable City debt obligation, or other interested parties as the Finance Director or any other member of the Disclosure Working Group determines is advisable, related to disclosure issues and practices. Meetings of the Disclosure Working Group may be held telephonically. ME The Disclosure Working Group is an internal working group of City staff and not a decision - making or advisory body subject to the provisions of the Ralph M. Brown Act (Government Code Section 54950 et seq.). 2. Responsibilities. The Disclosure Working Group is responsible for: a) reviewing all Initial Disclosure Documents, and making recommendations to the City Council or appropriate governing board for their approval of Initial Disclosure Documents; b) reviewing all continuing disclosure obligations as contained in Initial Disclosure Documents before such documents are released to the prospective investors, and making recommendations to the City Council or appropriate governing board for their approval of such continuing disclosure obligations; c) reviewing annually the City's status and compliance with continuing disclosure obligations, including filings of Continuing Disclosure Documents, compliance with these Procedures and the annual report prepared by the Disclosure Consultant as described in Section II (C) below; d) reviewing any items referred to the Disclosure Working Group; and e) evaluating the effectiveness of these Procedures and approving changes to these Procedures. For purposes of these Procedures, "Initial Disclosure Documents" means disclosure documents describing City indebtedness for use in connection with the offering and sale of the indebtedness or interests therein, including Official Statements (as defined in the next sentence); and "Continuing Disclosure Documents" means (i) annual continuing disclosure reports filed with the MSRB, and (ii) event notices and any other filings with the MSRB. As used in these Procedures, the term "Official Statements" means preliminary and final official statements, private placement memoranda and remarketing memoranda relating to the City's debt obligations, together with any supplements, for debt obligations for which a continuing disclosure obligation is required. B. Disclosure Coordinator 1. Appointment. The Finance Director, in consultation with the other members of the Disclosure Working Group, shall select and appoint a Disclosure Coordinator. The Finance Director may serve as the Disclosure Coordinator. 2. Responsibilities. The Disclosure Coordinator is responsible for: a) serving as a "point person" for personnel to communicate issues or information that should be or may need to be included in any Initial Disclosure Document or Continuing Disclosure Document; A -2 b) in preparing Initial Disclosure Documents and in anticipation of preparing Continuing Disclosure Documents, soliciting "material" information (as defined in Securities and Exchange Rule l Ob -5) from City departments and other relevant City Staff, c) following up with others, including management of outside consultants assisting the City, in the preparation and dissemination of Initial Disclosure Documents and Continuing Disclosure Documents to make sure that assigned tasks have been completed on a timely basis and making sure that the Continuing Disclosure Documents are filed on a timely basis and are accurate; d) In cooperation with the attorney or attorneys, or financial advisor, preparing any Initial Disclosure Document, and with other City or public agency Staff members with knowledge of the subject matter of the respective debt obligation, (i) reviewing each Initial Disclosure Document with the Disclosure Working Group and (ii) presenting the Initial Disclosure Document to the City Council or other appropriate governing board for approval, before it is disseminated to the public or prospective purchasers of the related debt obligation, all in order to ensure that all disclosure contained therein and not otherwise attributable to sources other than the City is accurate and does not omit to state information required to be stated therein in order to make the statements therein not misleading in any material respect; e) preparing and filing the required Continuing Disclosure Documents, to the extent such filings are not prepared and filed by the Disclosure Consultant; f) monitoring compliance by the City with these Procedures, including timely dissemination of annual report and event filings as described in Sections III (B) and (C) below; g) recommending changes to these Procedures to the Disclosure Working Group as necessary or appropriate; h) together with the Finance Director (if other than the Disclosure Coordinator), coordinating the timely provision of information to the Disclosure Consultant as needed to fulfill its responsibilities to the City; i) maintaining records documenting the City's compliance with these Procedures; j) reviewing compliance with and providing appropriate certifications in connection with the various covenants in documents for debt obligations; and the Disclosure Coordinator shall review the documents for debt obligations to determine which covenants require an annual or regular certification and maintain a list of those with the Disclosure Coordinator (the Disclosure Coordinator may delegate such compliance requirements to the Disclosure Consultant); and k) ensuring that members of the Disclosure Working Group and the City Council or other applicable governing board approving Initial Disclosure Documents or Continuing Disclosure Documents receive periodic training regarding disclosure responsibilities and practices. A -3 3. Consultation. The Disclosure Coordinator shall consult with the disclosure counsel for a respective debt obligation to the extent the Disclosure Coordinator considers appropriate to perform the Disclosure Consultant's responsibilities. C. Disclosure Consultant 1. Appointment. The Finance Director shall designate or hire, as applicable, a Disclosure Consultant (who may be a City Staff member, an attorney retained as disclosure counsel, a financial advisor or other appropriate consultant) in consultation with the Disclosure Working Group. The Disclosure Consultant shall have significant expertise and experience related to on -going disclosure requirements for municipal securities. 2. Responsibilities. The Disclosure Consultant is responsible for: a) communicating to the Disclosure Working Group its information needs, reviewing Initial Disclosure Documents, Continuing Disclosure Documents and other relevant information, consulting with appropriate City staff or interested parties needed to confirm that the City is meeting its disclosure obligations; and b) from time to time, making recommendations to the Disclosure Working Group regarding ways the City may improve these Procedures and methods of meeting City continuing disclosure obligations. D. Others With Responsibility for Initial Disclosure Documents 1. Responsibilities of City Attorney. The City Attorney (or a designee) shall review Initial Disclosure Documents and shall draft for Initial Disclosure Documents descriptions of (a) any material current, pending or threatened litigation, (b) any material settlements or court orders and (c) any other legal issues that are material information for purposes of any respective Initial Disclosure Document. 2. Responsibilities of Finance Director. The Finance Director shall review each Initial Disclosure Document, identify any material difference in presentation of financial information from the City's most recent financial statements and ensure there are no misstatements or omissions of material information in any sections that contain descriptions of information prepared by the Finance Director (or the Finance Director's staff) or of relevance to the finances of the City. In addition, the Finance Director shall determine whether the City's then - available financial statements are appropriate to be included in the respective Initial Disclosure Document and whether to seek the consent of the City's auditor to including financing statements in the respective Initial Disclosure Document. III. CONTINUING DISCLOSURE FILINGS A. Overview of Continuing Disclosure Filings Under the continuing disclosure undertakings it has entered into in connection with its debt offerings, the City is required to file annual reports with the Municipal Securities Rulemaking Board's MSRB ") Electronic Municipal Market Access ( "EMMA ") system in accordance with such undertakings in each year. Such annual reports are required to include certain updated financial and operating information (or may refer to a publicly - available document), which varies among the different obligations issued by the City, the City's audited financial statements and other information material to investors. The City is also required under the continuing disclosure undertakings to file notices of certain events with EMMA. B. Annual Reports The Disclosure Coordinator shall ensure that the preparation of the City's annual reports commences as required to satisfy the filing requirements under each specific continuing disclosure obligation. Before any annual report is submitted to EMMA, the Disclosure Coordinator shall confer with the Disclosure Working Group as needed regarding the content and accuracy of any annual report. Prior to each filing, the Disclosure Coordinator will review each report with the Disclosure Consultant, and the Disclosure Consultant will confirm in writing (which may be by email) that such report appears to comply with the requirements of the applicable continuing disclosure undertaking. C. Event Filings Each member of the Disclosure Working Group shall notify the other members of the Disclosure Working Group if he or she becomes aware of any of the material events listed in any of the City's continuing disclosure undertakings. The Disclosure Working Group may meet to discuss the event and to determine, in consultation with the Disclosure Consultant, whether a filing is required or is otherwise desirable. D. Uncertainty The Finance Director may direct questions regarding the disclosure to the Disclosure Consultant, disclosure counsel, bond counsel or the City Attorney or such other counsel or consultant he /she deems appropriate. IV. CONTINUING DISCLOSURE DOCUMENTS TO BE RETAINED The Disclosure Coordinator shall be responsible for retaining records demonstrating compliance with the Continuing Disclosure Document requirements of these Procedures. The Disclosure Coordinator shall retain an electronic or paper file ( "Disclosure File ") for each continuing disclosure annual report that the City completes. Each Disclosure File shall include the final version of the applicable Initial Disclosure Document and all related Continuing Disclosure Documents; written confirmations, certifications, letters and legal opinions described herein; copies of these Disclosure Procedures and a list of individuals to whom they have been distributed and the dates of such distributions; and a written record of the dates of meetings of the Disclosure Working Group. The Disclosure File shall be maintained in a central depository for a period of five years from the later of the date of delivery of the securities referenced in the Continuing Disclosure Document, or the date the A -5 Continuing Disclosure Document is published, posted, or otherwise made publicly available, as applicable. V. EDUCATION The Finance Director shall ensure that the Disclosure Coordinator and the members of the Disclosure Working Group are properly trained to understand and perform their responsibilities. Such training may include training sessions conducted by consultants with expertise in municipal securities disclosure or by the Disclosure Consultant, attendance at conferences, or other appropriate methods identified by the Finance Director. VI. AMENDMENTS Any provision of these Procedures may be waived or amended at any time by action of the City Council, or otherwise by written confirmation of the City Manager upon consultation with the Finance Director. BE