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City of Pleasanton Operating Budget • FY 2023/24 - FY 2024/25C - 22 Trustee/Fiscal AgenUPaying Agent: • Establishes and holds the funds and accounts relating to the bond issue • Maintains the list of names and addresses of all registered owners of the bonds and recordings of transfers and exchanges of the bonds • Acts as the authenticating agent • Acts as the paying agent • Protects the interests of the bondholders by monitoring compliance with covenants and acts on behalf of the bondholders in the event of default • As the escrow agent holds the investments acquired with the proceeds of an advance refunding and uses those funds for payments on those investments to pay debt service on the refunding bonds • As a dissemination agent acts on behalf of the issuer or other obligated person to disseminate annual reports and event notices to repositories under SEC Rule 15c2-12 RFP’s for Trustee services should be done on a periodic basis if the recurring Trustee fees increase excessively (in excess of the prevailing Bay Area inflation rate). B. Method of Sale The City will determine, on a case-by-case basis, whether to sell its bonds competitively or through negotiation. Competitive Sale In a competitive sale, the City’s bonds shall be awarded to the bidder providing the lowest true interest cost as long as the bid adheres to the requirements set forth in the official notice of sale. Conditions under which a competitive sale would be preferred are as follows: • Bond prices are stable and/or demand is strong. • Market timing and interest rate sensitivity are not critical to the pricing. There are no complex explanations required during marketing regarding issuer’s projects, media coverage, political structure, political support, and funding or credit quality. • The bond type and structure are conventional. • Bond insurance is included or pre-qualified (available). • Manageable transaction size. • The City (or a City enterprise) has strong credit ratings. • The City (or a City enterprise) is well known to investors. Negotiated Sale The City recognizes that some securities are best sold through negotiation. Conditions under which a negotiated sale would be preferred are as follows: • Interest rates are volatile. • Demand is weak or supply of competing bonds is high. • Market timing is important, such as for refunding’s. • Issuer has lower or weakening credit rating. • Issuer is not well known to investors. • Sale and marketing of the bonds will require complex explanations about the issuer’s projects, media coverage, political structure, political support, funding, or credit quality. • The bond type and/or structural features are non-standard, such as for a forward delivery bond sale, issuance of variable rate bonds, or where there is the use of derivative products.