Metro - File #: 2022-0131

• File #: 2022-0131
• Type: Resolution
• Status: Agenda Ready
• File created: 2/28/2022
• In control: Board of Directors - Regular Board Meeting
• On agenda: 4/28/2022
• Final action: 4/28/2022
• Title: ADOPT: A. a resolution that authorizes the Chief Executive Officer and/or other Designated Officers to renew and/or replace the existing direct-pay letter of credit ("LOC") with respect to the Proposition A ("Prop A") commercial paper ("CP") and short-term borrowing program, Attachment A; and B. a resolution that authorizes the Chief Executive Officer and/or other Designated Officers to renew and/or replace the existing direct purchase revolving credit facility with respect to the Proposition C ("Prop C") revolving credit facility ("RCF") and short-term borrowing program, Attachment B. (REQUIRES SEPARATE, SIMPLE MAJORITY VOTE OF THE FULL BOARD)
• Sponsors: Board of Directors - Regular Board Meeting
• Indexes: Alameda Corridor East, Budgeting, Capital Project, Debt, Debt Service - Prop A Governmental (Project), Debt Service-Prop C - Governmental (Project), Debt Service-Union Station Acquisition (Project), Grant Aid, Outreach, Program, Proposition A, Proposition C, Request For Proposal, Resolution, Safety, San Gabriel Valley Council of Governments, Strategic planning, Surveys
• Related files: 2021-0797

Date	Action By	Action	Result
4/28/2022	Board of Directors - Regular Board Meeting

Meeting_Body
REGULAR BOARD MEETING
APRIL 28, 2022

Subject
SUBJECT: PROPOSITION A AND PROPOSITION C COMMERCIAL PAPER/SHORT-TERM BORROWING PROGRAMS

Action
ACTION: APPROVE RECOMMENDATIONS

Heading
RECOMMENDATION

Title
ADOPT:

A. a resolution that authorizes the Chief Executive Officer and/or other Designated Officers to renew and/or replace the existing direct-pay letter of credit ("LOC") with respect to the Proposition A ("Prop A") commercial paper ("CP") and short-term borrowing program, Attachment A; and

B. a resolution that authorizes the Chief Executive Officer and/or other Designated Officers to renew and/or replace the existing direct purchase revolving credit facility with respect to the Proposition C ("Prop C") revolving credit facility ("RCF") and short-term borrowing program, Attachment B.

(REQUIRES SEPARATE, SIMPLE MAJORITY VOTE OF THE FULL BOARD)

Issue
ISSUE

The Prop A and Prop C Commercial Paper/Short-Term Borrowing programs have proven to be flexible, cost-effective methods of short-term financing for Metro's capital program. The Prop A LOC provided by Barclays Bank PLC and the Prop C RCF with Wells Fargo Bank, N.A., expire in July 2022.

Background
BACKGROUND

The Board established the Prop A short-term borrowing program in January 1991 to provide interim taxable or tax-exempt financing until grant reimbursement or other funding sources are received. Under the Proposition A short-term borrowing program, Metro is authorized to issue and have outstanding at any one time up to $350 million in CP notes. An LOC, which guarantees payment of the maturing CP Notes, is a required feature of the CP program.

CP is a short-term debt instrument that can be issued with maturities from 1 to 270 days. As notes mature, new notes are simultaneously issued (i.e. "rolled over"). The LOC provides guaranteed liquidity to investors when their notes mature and are a required component of the program. Additionally, the LOC provides a safety net to ...