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APFA2021/03/23ANAHEIM PUBLIC FINANCING AUTHORITY REGULAR MEETING OF MARCH 23, 2021 The Anaheim Public Financing Authority regular meeting of March 23, 2021 was called to order in person and telephonically at 5:05 P.M. in joint session with the Anaheim Housing Authority and the Anaheim City Council, pursuant to Brown Act related provisions of Governor Newsom’s Executive Order N-29-20 in response to COVID-19 (superseding the related provisions stated in Executive Order N-25-20), The meeting notice, agenda, and related materials were duly posted on March 18, 2021. MEMBERS PRESENT: Chairman Harry Sidhu and Authority Members Stephen Faessel, Jose Diaz, Avelino Valencia, and Trevor O’Neil (in person). Authority Member Jordan Brandman (via teleconference; arrived in person at 6:31 P.M.) MEMBERS ABSENT:Authority Member Jose F. Moreno STAFF PRESENT:City Manager Jim Vanderpool, City Attorney Robert Fabela, and Secretary Theresa Bass. ADDITIONS/DELETIONS TO THE AGENDA: None PUBLIC COMMENTS (all agenda items): No in-person public comments related to the Public Financing Authority agenda. One (1) electronically submitted public comment related to the Public Financing Authority agenda. – See Appendix. CITY MANAGER’S UPDATE: City Manager Jim Vanderpool announced there was an incredible display of Anaheim pride on March 22 as the Anaheim Ducks mascot, Wild Wing, and the team’s DJ, DJ Jojo, visited the Anaheim Convention Center (ACC) Super POD to help celebrate over 300,000 vaccines provided in Anaheim, with 100,000 vaccines provided in just one month at the ACC. He thanked the Anaheim Ducks for helping celebrate the incredible milestone. He further announced that the Community Services Department, in partnership with the Orange County United Way and Good Hands Foundation, was offering free tax preparation services to income-qualified families through the OC Free Tax Prep via the IRS Volunteer Income Tax Assistance (VITA) program. He noted contactless drop-off locations for tax documents were located at the Downtown Anaheim Community Center, West Anaheim Youth Center, and Ponderosa Park Family Resource Center. He noted the program helped 768 clients last year, a similar number was expected this year, and questions can be directed to Human Services staff at 714-765-4500. Mr. Vanderpool also announced that April 4 -10 is National Library Week, with the Anaheim Public Library kicking off with the Angels Baseball Rally Readers program, featuring Joe Madden and Trent Rush hosting a story time on the Library’s Facebook and Instagram pages on Monday, April 5 at 11:00 A.M. Throughout the month, Angels players will share the importance of literacy through photos of their favorite reads. ITEM # 02 Anaheim Public Financing Authority Minutes of March 23, 2021 Page 2 of 9 At 6:30 P.M., Chairman Sidhu recessed the Anaheim City Council and Anaheim Housing Authority to address the Anaheim Public Financing Authority Consent Calendar. CONSENT CALENDAR: At 6:30 P.M., Authority Member Brandman moved to approve the consent calendar as presented, seconded by Authority Member Faessel. ROLL CALL VOTE: AYES – 6: (Chairman Sidhu and Authority Members Faessel, Diaz, Brandman, Valencia, and O’Neil); NOES – 0; ABSENT – 1 (Authority Member Moreno). Motion carried. 1.Approve minutes of the Public Financing Authority meeting of November 24, 2020. At 6:31 P.M., Chairman Sidhu reconvened the Anaheim City Council in joint session with the Anaheim Public Financing Authority). END OF CONSENT CALENDAR: 2.Consider a resolution of the Anaheim Public Financing Authority (APFA) and a resolution of the Anaheim City Council, separately, authorizing the execution and delivery of a Ground Lease, a Lease Agreement, an Indenture, a Bond Purchase Contract, and Continuing Disclosure Agreement in connection with the authorization of the issuance (APFA) and approval of the issuance (City Council) of Lease Revenue Bonds (Working Capital Financing), Series 2021A, and Series 2021B (Federally Taxable), in the not to exceed amount of $210,000,000, and related actions [Properties included in the lease agreements: Fire Station No. 3 (1717 S. Clementine), Fire Station No. 6 (131 S. Euclid Street); Fire Station No. 11 (3078 W. Orange Avenue); East Anaheim Library and Police Substation (8201 E. Santa Ana Canyon Rd.); East Canyon Gymnasium (8165 E. Santa Ana Canyon Rd.); Main Police Station (425 S. Harbor Blvd.); West Anaheim Youth Center (320 S. Beach Blvd.); City Hall (200 S. Anaheim Blvd.); Canyon Hills Library (400 S. Scout Trail); Central Library (500 W. Broadway)]. Public Financing Authority Action: 2-A.RESOLUTION NO. APFA-2021-001 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ANAHEIM PUBLIC FINANCING AUTHORITY authorizing the execution and delivery of a Ground Lease, a Lease Agreement, an Indenture and a Bond Purchase Contract in connection with the issuance of Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021A, and Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021B (Federally Taxable), authorizing the issuance of such Series A Bonds and such Series B Bonds in an aggregate principal amount of not to exceed $210,000,000, authorizing the distribution of a Preliminary Official Statement and an Official Statement in connection therewith and authorizing the execution of necessary documents and certificates and related actions. Anaheim Public Financing Authority Minutes of March 23, 2021 Page 3 of 9 City Council Action: 2-B.RESOLUTION NO. 2021-022 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM authorizing the execution and delivery by the City of a Ground Lease, a Lease Agreement, an Indenture, a Purchase Contract and a Continuing Disclosure Agreement in connection with the issuance of Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021A, and Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021B (Federally Taxable), approving the issuance of such Series A Bonds and such Series B Bonds in an aggregate principal amount of not to exceed $210,000,000, authorizing the distribution of a Preliminary Official Statement and an Official Statement in connection with the offering and sale of such Bonds and authorizing the execution of necessary documents and certificates and related actions. Chairman Sidhu reported this item would authorize staff to take actions, including borrowing, to address the City’s budget crisis caused by the pandemic. City Manager James Vanderpool reported staff prepared a budget update in December significantly adjusting the General Fund. He advised staff committed to return in the spring with an update and recommendations for borrowing through the crisis and noted the staff recommendation to borrow was not made lightly. He explained the pandemic hit Anaheim disproportionally from other cities in the region, State, and around the nation. Finance Director Debbie Moreno reported the adopted budget for Fiscal Year 2020/21 was $1.7 billion, with a General Fund budget accounting for 18% of the total. She advised the adopted General Fund budget included $344,000,000 in total operating sources. She noted 71% of revenue come from the “big three” taxes, including Property Tax (25%), Transient Occupancy Tax (TOT) (24%), and Sales and Use Taxes (22%). She reported $419,000,000 of total operating uses, not including the department reductions placeholder. She advised, when the budget was first adopted, there was a possibility the theme parks would be open by the fall. She reported economists now believe it could take years for tourism to fully recover, especially international tourism. She advised the speed of the recovery would be contingent on the state of the virus. Ms. Moreno shared the “big three” tax revenues annually for the past 10 years. She stated they peaked at $328,500,000 in FY 18/19. She advised the expected dip in the FY 20/21 budget was down to $245,900,000, but the current FY 20/21 projections have the total at $175,400,000. She noted $60,000,000 of this reduction stemmed from TOT revenues as the theme parks remain closed. She explained the reduction of $10,000,000 in anticipated Sales Tax and Property Taxes are what was anticipated for FY 20/21. Ms. Moreno reported 64% of the General Fund operating uses go categorically towards labor, while 59% go functionally to public safety. She detailed how the City has already implemented spending reduction strategies, saving the City $19,000,000 without impacting services. Ms. Moreno presented a chart comparing the projected deficits at the time of the FY 20/21 budget’s adoption, in December 2020, and as of March 2021. She advised the impending reopening of Disneyland had a positive impact since the December numbers assumed it would not open until the summer. She noted this took the anticipated operating deficit from Anaheim Public Financing Authority Minutes of March 23, 2021 Page 4 of 9 $113,800,000 in December to $108,500,000 in March. She advised the most significant adjustment is from the City receiving $53,000,000 from the American Rescue Plan Act, dropping the total deficit from $162,200,000 in December to $66,900,000. Ms. Moreno presented updated five-year future comparisons of General Fund deficits through FY 24/25 as the economy starts to ramp back up. She reported the stimulus funds are not enough to maintain service levels. Mike Berwanger, Managing Director of PFM Financial Advisors LLC, advised their recommendation is to borrow to cover the deficit and projected budget shortfalls. He reported they have tried to stay nimble and reactive as the pandemic situation changes. He noted the borrowing would increase future costs to the City and add pressure to future budgets. He advised they would structure the borrowing to mitigate this as best as possible. He advised they are continuing to work on other possible debt-related cost savings opportunities. Mr. Berwanger reported they are requesting a not-to-exceed amount of $210,000,000 to fund all the FY 20/21 and FY 21/22 deficits along with a portion of the FY 22/23 deficit. He explained the size is flexible until the bond sale date in May or June. He advised the $210,000,000 is a conservative estimate, assuming the impending federal relief funds are not deposited on schedule. He noted the figure would be $162,000,000 if the federal funds arrive on time. He advised they would be issuing Lease Revenue Bonds which the City has issued before. Mr. Berwanger reported the bonds would be 30-year borrowing at 3.63%. He advised this rate makes for an annual debt service of $12,300,000 if the federal funds do not arrive on time or $9,500,000 if they do arrive on time. He advised the interest is capitalized for the first two years, with repayment beginning in 2024, and noted there is no prepayment penalty beginning at the 10th year. He advised the prepayment penalty before 10 years is contingent on interest rates at the time. Ms. Moreno detailed how the $162,000,000 in borrowed money would be applied to the budget over the next five years. She advised the fourth and fifth years were hard to project due to the unknown speed of pandemic recovery. She advised the borrowed funds would be enough to provide the service levels residents expect over the next three years. Mr. Vanderpool advised staff believes this is a reasonable reaction to a pandemic that has hit the City disproportionally. He believed it to be a responsible borrowing plan to bridge shortfalls and not allow for additional spending. He advised the recommendation builds in rapid repayment features and advised it allows the City to maintain current service levels at a time when the community needs them most. He advised the recommendation provides a plan for a strong economic recovery for the City. DISCUSSION: Chairman Sidhu advised the two most important things the City Council does are hiring a City Manager to ensure good day-to-day operations for the City and adopting a budget. Chairman Sidhu reported the City has been devastated by the pandemic’s economic shutdowns. He agreed with some of the shutdowns but noted Anaheim was hit harder than almost any other large city for its reliance on the tourism and hospitality sectors. He advised it gave Anaheim one of the County and State’s strongest budgets in good times, allowing for robust services without adding to the Sales Tax. He reported, in a normal year, nearly half of the City’s revenue comes from the Anaheim Resort through the “big three” taxes, funding so many Anaheim Public Financing Authority Minutes of March 23, 2021 Page 5 of 9 essential community services. He advised the closures ripped a hole in the Anaheim budget, bringing tax collections to a screeching halt. Chairman Sidhu noted TOT revenues were down 90% from a typical year, leading to the General Fund deficit of about $120,000,000. He advised the savings from the hiring freeze and other practices did not significantly alter the situation. He explained that eliminating every City department still would not be enough simply to fund the Anaheim Police Department and Anaheim Fire & Rescue alone. Chairman Sidhu advised they could now see the light at the end of the tunnel. He reported, with the City leading the way, Orange County is seeing some of the nation’s best vaccination efforts, and the reopening process is beginning. He advised almost 10,000 fans would be able to attend next Monday’s Los Angeles Angels opening day game at Angel Stadium. He advised Disneyland could safely reopen on April 30, 2021, albeit with a limited capacity, and reported Disney is calling 10,000 cast members back to work. He advised hotels and restaurants are reopening with strong safety protocols. He noted Anaheim would receive funding from the American Rescue Plan, which he actively fought for. He reported the result of the City’s lobbying is almost $108,000,000 in federal relief funds. Chairman Sidhu advised the recovery would be slow. He noted Disneyland would operate at a limited capacity and be restricted to California residents. He advised this would result in fewer hotel stays within the City. He noted any restart is good, but it would be a while until they are fully operational and generating the tax revenues anticipated before the pandemic. He advised there is cause for long-term optimism and noted the Walt Disney Company continued to invest in Anaheim, citing the Avengers Campus which would soon be opened. He advised Disney would continue to keep Disneyland the west coast’s premier tourist attraction. Chairman Sidhu advised the City ensured its marketing partners at Visit Anaheim remained open and ready to drive tourism back. He reported the Anaheim Ducks Hockey Club and Honda Center have submitted early plans for the ocV!BE development. He reported SRB Management is expected to submit a tentative tract map next week for the future development of the Angel Stadium site. He noted a payment of $20,000,000 would come with the map to join the $30,000,000 that SRB has already paid the City and noted $70,000,000 would be released to the City after the sale is closed later this year. He advised the stadium development plan would bring 10,000 jobs, billions of dollars in economic activity, and tens of millions of dollars of new tax revenue to the City. He believed the stadium development would rival Disneyland in its positive economic impact on the City. Chairman Sidhu advised the past year has been a challenge, but the future of Anaheim would always be bright. He advised when he was elected two years ago he told residents they would be able to see economic development in their neighborhoods and they are seeing this already. He reported the City and non-profits have looked deeply into what each area wants should the City invest in their neighborhood. He advised they are starting to emerge from the pandemic and can give this more focus again and noted he is always willing to bet on Anaheim’s future success. Chairman Sidhu advised he was prepared to support the borrowing plan and asked the City Council to join him. He stated this was a major undertaking and not one he supported lightly. He expressed confidence in staff’s assessment of how much borrowing would get the City through the next few years. He explained this was a move City Council needs to make tonight rather than eliminating services. He advised this as a particularly right call with interest rates near Anaheim Public Financing Authority Minutes of March 23, 2021 Page 6 of 9 historic lows. He advised the City Council believes in Anaheim and its neighborhoods and asked them to reaffirm their commitment to the principle of Anaheim First. MOTION: Chairman Sidhu moved to approve Item No. 02 as presented, seconded by Authority Member Faessel. DISCUSSION: Chairman Sidhu stated his motion comes with clear direction to staff to use the borrowing authority with caution, to use the least amount necessary, and to return to Council for direction on how to use excess funds should the economy recover quicker than anticipated. He advised direction for staff to begin planning for investing the Angel Stadium site funds directly into Anaheim’s neighborhoods and bringing the plan back to Council by the end of the year. He stated this recommendation must be supported by the input received from residents through the Anaheim First initiative, and other means of public input. Chairman Sidhu advised the City faces a challenging future but they can keep the pledge they made to residents to listen to their input and make meaningful investments into their neighborhoods to improve their quality of life. He advised the most important part of the pledge is to take advantage of the economic opportunities they create in Anaheim by reinvesting it in their neighborhoods after asking for their input. He reported, at the time, he called for investing $25,000,000 a year for 10 years for investing in diverse neighborhoods. Chairman Sidhu advised if City Council reaffirms its pledge tonight, it shows that Anaheim residents are first. He noted they could reaffirm this by creating an environment where businesses want to bring jobs and exciting projects. He reported the Angel Stadium development would provide the City with $70,000,000 this year and $20,000,000 more per year over the next four (4) years. He noted he wants all this money to go to neighborhood improvements, knowing the tax revenue generated by the development will go to fund City services. Chairman Sidhu advised City Council can also reaffirm the pledge because over 30 years ago, Anaheim shared the vision of turning a single theme park in Disneyland into a world-class destination. He noted they invested in infrastructure for what has become the Disneyland Resort. He advised the tax contributions to the City have grown astronomically and paid off the bonds which financed the infrastructure that made it possible. He advised these bonds would soon be paid off completely, freeing up tens of millions of dollars for the City which will allow it to pay off the bonds they are discussing tonight and continue reinvesting in Anaheim neighborhoods and municipal services. He noted the pandemic may have delayed the pledge but it would not stop the City Council. Chairman Sidhu asked staff to borrow in the short term with caution on how they are engaging in the borrowing. He asked staff to reaffirm the City’s commitment to listen to and invest in their neighborhoods. Vice Chairman Faessel praised Chairman Sidhu’s commitment to Anaheim First, which was stalled by the pandemic. He advised City Council agrees on wanting to get it moving ahead. In response to Vice Chairman Faessel’s inquiry, Mr. Vanderpool advised the options available to address the crisis were limited. He noted staff implemented several actions including an early retirement program, hiring freeze, freezing unessential expenditures, and other items. He noted staff did not feel comfortable recommending cuts to services and took unorthodox solutions to bridge the gap facing the largest deficit of any municipality in the State. He explained the limited Anaheim Public Financing Authority Minutes of March 23, 2021 Page 7 of 9 options on solutions is why they are presenting a very responsible borrowing plan with rapid repayment options. In response to Authority Member Diaz’s inquiries, Mr. Vanderpool explained tightening their belt would involve cuts to service. He noted the largest share of the budget is public safety services, such as police and fire, and advised staff did not feel comfortable recommending cutting critical daily services. He advised the magnitude of the deficit requires unique solutions because tightening their belt would decimate needed services. He clarified it would require laying off dozens of police and fire personnel, closing most of the libraries, eliminating all public works street maintenance, eliminating senior centers, and more. He noted using the word “decimate” was intentional because it would destroy their public services. Authority Member Diaz noted it was already known that the pandemic devastated the City’s economy and finances. He advised the City is in a good position to borrow the money at an excellent interest rate with early repayment as to not make the next generation responsible for this debt and noted residents expect these essential services. He advised he reviewed the item and was briefed by the Finance Department. He expressed support for the item and thanked staff for their work. Authority Member Brandman recounted that only Chairman Sidhu was in office during the recession of 2008-09 and remembers what it was like. He noted he served as an Anaheim Union High School District Trustee at the same time. He recalled that the recession was devastating, with many tough decisions needing to be made, and noted they used their best judgment to get through it. He likened the pandemic’s impact to the Great Depression and advised the City is obligated to help residents as best it can and noted the recommendation from staff and Chairman Sidhu’s motion to approve it achieves that goal. He acknowledged the difficulty of the past year and expressed hope that things would soon again be the way they were before the pandemic. He thanked Mr. Vanderpool, Ms. Moreno, and City staff and expressed support for the motion. In response to Authority Member Valencia’s inquiries, Mr. Vanderpool explained the borrowing is against 30-40% of unencumbered assets and advised the bulk of the City’s quality assets would still be available. He noted other cities have used their streets as assets but Anaheim would not. He confirmed they would still have assets on hand if things worsen with the pandemic. He confirmed the City would borrow only what is necessary to maintain service levels and advised the intent is for the City to have minimal or no surplus funds from the borrowed money. He confirmed they would ask for City Council's direction on how to use any surplus funds and advised the City intends to repay the debt as quickly as possible. He noted they have aligned the borrowing plan for the funds to be available within 10 years. Authority Member Valencia advised the pandemic has had a significant impact on the budget and to maintain the level of services residents expect the City must borrow. He recommended they borrow as little as possible to bridge the budget gap. He recommended the debt repayment be finished as quickly and fiscally feasible as possible. He praised the City’s team for putting this forth and noted this decision does not come easily to him. Authority Member Valencia noted he was not part of the Anaheim First initiative’s origins. He agreed it should play a role in redeveloping the City but advised it should not be the guiding principle. He advised he would abstain from a motion to reaffirm commitment to the Anaheim First model but would move forward with supporting the borrowing. Anaheim Public Financing Authority Minutes of March 23, 2021 Page 8 of 9 Authority Member O’Neil reported he has had many briefings with staff and all of his questions have been answered. He advised the crisis is not the City’s doing, because the City’s economy was the strongest it had ever been before the pandemic. He recalled that a two-week pause to flatten the curve became a year’s worth of closures, including Disneyland. He noted public health and the economy can coexist as other states and countries have shown. He denounced Governor Newsom’s response to the pandemic leading to irreparable damages to businesses and an enormous budget hole for Anaheim. He expressed disappointment neither the United States Congress nor President Biden considered deficits and fiscal needs in allocating the American Rescue Plan funds. Authority Member O’Neil agreed with colleagues that the City could not cut its way out of this dilemma. He advised the City has operated with a lean staff since making cuts during the 2008 recession. He noted the City currently has 22% fewer full-time employees than during the recession so there is not anything left to cut without adversely impacting services. He noted Anaheim has not raised taxes like other Orange County cities and he would not consider this as an option regardless. He explained that borrowing money to pay bills the City already owes is not financially prudent but is the most realistic option in the short term. He expressed support for the motion. Authority Member O’Neil expressed concerns they do not have a plan to repay the borrowed money. He expressed confidence in the economy rebounding but requested there be a mechanism in place to prioritize the repayment of these bonds. He noted Chairman Sidhu stated the resort bonds were almost repaid and Mr. Vanderpool noted the intent of using the savings to repay these bonds. He expressed his comfort the money would be available but reiterated that tonight the City could not declare the extra money would be used to repay these bonds. He advised he would be asking for an agenda item for staff to present options for the resort bond expenditures to be reapplied to this new debt once the resort bonds are paid off. Chairman Sidhu called for a vote on Item No. 02-A. Council Member Valencia advised he would abstain from the portion of the motion reaffirming the commitment to Anaheim First. In response to City Attorney Rob Fabela’s inquiry, Chairman Sidhu clarified his statement was about the importance of Anaheim First and was not part of the motion. Public Financing Authority Action: MOTION: Chairman Sidhu moved to approve RESOLUTION NO. APFA-2021-001 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ANAHEIM PUBLIC FINANCING AUTHORITY authorizing the execution and delivery of a Ground Lease, a Lease Agreement, an Indenture and a Bond Purchase Contract in connection with the issuance of Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021A, and Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021B (Federally Taxable), authorizing the issuance of such Series A Bonds and such Series B Bonds in an aggregate principal amount of not to exceed $210,000,000, authorizing the distribution of a Preliminary Official Statement and an Official Statement in connection therewith and authorizing the execution of necessary documents and certificates and related actions, seconded by Authority Member Faessel. ROLL CALL VOTE: AYES – 6 (Chairman Sidhu and Authority Members Faessel, Brandman, Diaz, Valencia, and O’Neil); NOES – 0; ABSENT – 1 (Authority Member Moreno). Motion carried. Anaheim Public Financing Authority Minutes of March 23, 2021 Page 9 of 9 City Council Action: Mayor Sidhu called for a vote on Item No. 02-B. MOTION: Mayor Sidhu moved to approve RESOLUTION NO. 2021-022 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM authorizing the execution and delivery by the City of a Ground Lease, a Lease Agreement, an Indenture, a Purchase Contract and a Continuing Disclosure Agreement in connection with the issuance of Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021A, and Anaheim Public Financing Authority Lease Revenue Bonds (Working Capital Financing), Series 2021B (Federally Taxable), approving the issuance of such Series A Bonds and such Series B Bonds in an aggregate principal amount of not to exceed $210,000,000, authorizing the distribution of a Preliminary Official Statement and an Official Statement in connection with the offering and sale of such Bonds and authorizing the execution of necessary documents and certificates and related actions, seconded by Mayor Pro Tem Faessel. ROLL CALL VOTE: AYES – 6 (Mayor Sidhu and Council Members Faessel, Diaz, Brandman, Valencia, and O'Neil); NOES – 0; ABSENT – 1 (Council Member Moreno). Motion carried. ADJOURNMENT: There being no further business to conduct, without objection, Chairman Sidhu adjourned the meeting of the Anaheim Public Financing Authority at 7:35 P.M. Respectfully submitted, Theresa Bass, CMC Secretary, Anaheim Public Financing Authority Public Comment From: Sent: To: Subject: Attachments: Hello Tuesday, March 23, 2021 11:48 AM Public Comment 3-23-21 Council Comments Council Comments 3_23_21 Bonds.pdf Please deliver the attached comments to all city council members. Thanks Ryan Balius March 23, 2021 Honorable Mayor and Members of the Anaheim City Council, I am writing in response to agenda item 02-B, relating to the issuance of Lease Revenue Bonds to offset revenue losses sustained as a result of the COVID-19 pandemic. I am acutely aware of the impact that COVID-19 induced business closures have had on the economy of the City of Anaheim — it is the same impact that virtually every community across the country has felt. I also recognize the need to offset the tax revenue losses the pandemic has caused in order to continue to subsidize critical community services, included public safety and public works -related services. My concern with the proposal set forth in Item 02-B is that the City is exacerbating the problem through the issuance of a significant amount of debt — a debt that will take a generation to repay. Rather than issuing a debt burden that will be an albatross for the City for the next 30 years, I would like to propose that the City Council look at existing alternatives to address revenue needs in the short-term, as it appears that there may be a light at the end of the tunnel coming soon and a return to "normal" may not be too far in the future. While I understand budget reductions are painful, I also believe that the COVID-19 pandemic has given the City a once-in-a- lifetime opportunity to thoroughly evaluate the programs and services that form the baseline of what Anaheim offers the community. Once those baseline services have been identified and funded, the City Council needs to continue to make difficult funding decisions for programs and services that have been deemed not critical. Quite simply, if existing funding sources are insufficient to fund non-essential services than those services need to be suspended until funding is available. Issuing debt to fund non-essential services is irresponsible. In addition to a thorough evaluation of the budget, I would like to propose that the City re -open negotiations on the sale of Anaheim Stadium and the terms that have been agreed upon. Concessions provided to the developer to fund a $50 million park development need to be re- considered — if the City is in a position of needing to issue significant debt to fund ongoing operations, I do not believe it is responsible for the City to be providing a $50 million subsidy for the development and construction of a park. I would like the City Council to consider re- negotiating the referenced agreement terms in an effort to secure the $50 million subsidy for direct use by the City — and not as a developer inducement. Further, the current proposal for the sale of the Stadium includes an allocation for the development of affordable housing. While the construction of affordable housing is critical, and is in fact a State requirement established through the RHNA process, I would like to suggest that the amount allocated for affordable housing construction be reduced. Reducing the allocation will provide the City with more operating capital in the short-term, while also continuing to provide funding for the construction of needed affordable housing. In short, Anaheim Stadium is one of the City's most valuable assets. I would like to insure that the City is getting the maximum return on the value of the Stadium — and that this one-time revenue windfall is used to it greatest efficacy. Challenging times require challenging and difficult decisions to be made. I simply want to insure that the City has done its due diligence in exhausting all possible revenue and budget reduction alternatives before issuing a large amount of debt that will divert community resources for a generation in order to repay. I am concerned that the issuance of debt is short- sighted and will have significant negative impacts to the City over the next 30 years, even as the immediate infusion of funds will ease current financial burdens. Thank you for the opportunity to share my thoughts on this important issue. Sincerely, Ryan Balius Anaheim Resident