DATE: January 14, 2025
TO: Honorable Mayor and City Councilmembers
FROM: Financial Services Department
TITLE: APPROVE THE EXECUTION AND DELIVERY OF AGREEMENT OF REMOVAL, APPOINTMENT AND ACCEPTANCE FOR THE PURPOSE OF TRANSFERRING BOND TRUSTEE POWERS FROM THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. TO U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION; AND APPROVE CUSTODY AGREEMENT WITH U.S. BANK, NATIONAL ASSOCIATION FOR ASSET CUSTODY SERVICES.
RECOMMENDATION
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Staff recommends that the City Council and the Oceanside Public Financing Authority approve the form of Agreement of Removal, Appointment and Acceptance in order to remove The Bank of New York Mellon Trust Company, N.A. ("BNY") as trustee for various bonds (described below), under and pursuant to certain governing documents, and appoint U.S. Bank Trust Company, National Association ("U.S. Bank") as successor trustee; approve the Custody Agreement with U.S. Bank for asset custody services for the City's investment portfolio; and authorize the City Manager or Financial Services Director to execute the agreements with such changes as recommended by the City Attorney and Special Counsel.
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BACKGROUND AND ANALYSIS
BNY currently serves as the trustee for certain bonds (the "Bonds") issued by Community Facilities District No. 2000-1 of the City of Oceanside (Ocean Ranch Corporate Centre) ("CFD No. 2000-1"), Community Facilities District No. 2006-1 of the City of Oceanside (Pacific Coast Business Park) ("CFD No. 2006-1"), the Oceanside Public Financing Authority (the "Financing Authority"), and the City. U.S. Bank also currently serves as the trustee for several other bond transactions for the City. The City has experienced ongoing challenges with BNY, particularly related to reporting and service levels. A key issue is BNY's inability to provide monthly statements in Excel or CSV format, which is essential for efficient month-end reconciliations. City staff desires to remove BNY as the trustee f...
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