To: Board of Supervisors
From: Monica Nino, County Administrator
Report Title: TAX AND BOND COUNSEL CONTRACT - STRADLING YOCCA CARLSON & RAUTH
☒Recommendation of the County Administrator ☐ Recommendation of Board Committee
RECOMMENDATIONS:
APPROVE and AUTHORIZE the County Administrator, or designee, to execute a contract amendment with Stradling Yocca Carlson & Rauth for tax and bond counsel services extending the termination date from June 30, 2026 to June 30, 2028 and increasing the payment limit by $100,000, from $250,000 to $350,000.
FISCAL IMPACT:
The cost of tax and bond counsel services is covered in the cost of issuance included in each bond issue. Fees are to be capped at a maximum dollar amount (for both tax and bond counsel services) based on the type of bond issuance (e.g. lease revenue bond, tax revenue anticipation notes, etc.). This allows the County to plan for costs of issuance related to its future bond transactions. In addition to bond transactions bond and tax counsel may assist with regulatory matters or provide general consultation on an hourly basis. Those costs are paid by the County department seeking such consultation, which is typically within the County Administrator’s Office or the Department of Conservation and Development (DCD).
BACKGROUND:
On May 21, 2021, the County issued a Request for Proposals (RFP) for tax, bond and disclosure counsel services. After review by Debt Affordability Advisory Committee (DAAC) and firm interviews, Stradling Yocca Carlson & Rauth was recommended to the County Administrator for consideration of a contract award to provide bond and tax counsel services to the County through June 30, 2024. Subsequently, the contract was extended through June 30, 2026.
In addition to assistance with bonds, the services of Stradling Yocca Carson & Rauth are needed on an occasional basis to prepare presentations to rating agencies and complete other ad hoc projects in support of County business. It is important to retain a firm with these particular skills to ensure that the County is able to take advantage of potential refunding opportunities as they arise and stay updated on both market trends and other public finance-related legal issues such as the use of Inflation Reduction Act (IRA) tax credits.
The firm’s experience with housing related financing was of particular interest to the DAAC and County Administrator due to the significant amount of federal and state funds available for housing development. In addition, there has been increased interest by cities statewide in using Enhanced Infrastructure Financing Districts (EIFDs) to fund regional infrastructure projects. Having a firm that has experience in housing and innovative financing mechanisms continues to be important for this contract cycle.
Today’s action extends the contract with Stradling Yocca Carlson & Rauth and increases the payment limit associated with the contract. The additional payment authority reflects anticipated support for regulatory matters and consultation along with potential future transactions within the Department of Conservation and Development related to the County’s Single and Multi-Family Revenue Bond programs issued on behalf of affordable housing developers.
CONSEQUENCE OF NEGATIVE ACTION:
The County would not have the necessary legal representation on the issuance and sale of bonds and sufficient counsel for other public finance regulatory matters.