TO: ADAM PIRRIE, CITY MANAGER
FROM: JEREMY STARKEY, FINANCE DIRECTOR
DATE: SEPTEMBER 8, 2026
Reviewed by:
City Manager: AP
SUBJECT:
Title
TAX EQUITY AND FISCAL RESPONSIBILITY ACT OF 1982 HEARING TO APPROVE THE ISSUANCE OF UP TO $25 MILLION IN REVENUE BONDS BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY FOR THE BENEFIT OF THE CLAREMONT COLLEGES, INC.
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SUMMARY
The Claremont Colleges, Inc. (the "Borrower"), a California nonprofit public benefit corporation, has requested that the California Municipal Finance Authority (the "CMFA") issue one or more series of revenue bonds in an aggregate principal amount not to exceed $25,000,000 (the "Bonds")). The federal Tax Equity and Financial Responsibility Act (TEFRA) requires that a public hearing be held by the governing body of the jurisdiction in which the project is located, and that the local jurisdiction approves the proposed financing. The City has held such hearings in the past for the Webb Schools, Mt. San Antonio Gardens, Pilgrim Place, Western Christian Schools, Pomona College, Keck Graduate Institute, and Harvey Mudd College. Approval of the proposed financing will not impose any financial responsibilities on the City.
RECOMMENDATION
Recommended Action
Staff recommends the City Council adopt A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CLAREMONT, CALIFORNIA, APPROVING THE ISSUANCE BY THE CALIFORNIA MUNICIPAL FINANCE AUTHORITY OF REVENUE BONDS IN THE AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $25,000,000 TO FINANCE AND REFINANCE ACQUISITION, CONSTRUCTION, REPLACEMENT, RENOVATION, REFURBISHMENT, IMPROVEMENT, FURNISHING AND/OR EQUIPPING OF EDUCATIONAL-RELATED FACILITIES AND INFRASTRUCTURE FOR THE CLAREMONT COLLEGES, INC.; AND APPROVING CERTAIN OTHER MATTERS RELATING THERETO.
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ALTERNATIVES TO RECOMMENDATION
In addition to the recommendation, there are the following alternatives:
A. Request further information from staff.
B. Take no action.
FINANCIAL REVIEW
The Board of Directors of the California Foundation for Stronger Communities, a California non-profit public benefit corporation, acts as the Board of Directors for the CMFA. Through its conduit issuance activities, the CMFA shares a portion of the issuance fees it receives with its member communities and donates a portion of these issuance fees to the Foundation for the support of local charities. With respect to the City of Claremont, it is expected that 25 percent of the issuance fee will be granted by the CMFA to the City's General Fund. Such grant may be used for any lawful purpose of the City. The Borrower will be the beneficiary of a charitable donation through a 25 percent reduction in issuance fees.
As noted in this report, the City's approval of the issuance of the bonds will place no financial obligations upon the City. The staff cost to prepare this report and administer this program is estimated at $700 and is included in the operating budget of the Financial Services Department.
ANALYSIS
The Borrower has requested that the CMFA participate in the issuance of one or more series of revenue bonds in an aggregate principal amount not to exceed $25,000,000 (the “Bonds”). The proceeds of the Bonds will be used to finance and/or refinance the acquisition, construction, replacement, renovation, refurbishment, improvement, furnishing and/or equipping of certain educational-related facilities and infrastructure described below (collectively, the “Project”) that are and will continue to be owned and operated by the Borrower or affiliated entities, including without limitation refunding all or a portion of the California Educational Facilities Authority Revenue Bonds (Claremont University Consortium) Series 2011 and the California Educational Facilities Authority Revenue Bonds (Claremont University Consortium) Series 2012.
The Project will include: (i) financing and/or refinancing the acquisition, construction, replacement, renovation, refurbishment, improvement, furnishing and equipping of education-related facilities and infrastructure, (ii) refunding the California Education Facilities Authority Revenue Bonds (Claremont University Consortium) Series 2011 and the California Education Facilities Authority Refunding Revenue Bonds (Claremont University Consortium) Series 2012, the proceeds of which financed and refinanced the acquisition, construction, replacement, renovation, refurbishment, improvement, furnishing and equipping of education-related facilities and infrastructure, (iii) paying capitalized interest on the Bonds, and (iv) paying costs of issuance of the Bonds. The projects to be financed and refinanced with the Bonds are owned or principally used by the Borrower or one or more of its exempt affiliates as part of an integrated operation and will be located at or adjacent to the Borrower’s Administrative Campus Center and the campuses of The Claremont Colleges in Claremont, California 91711. The project locations include 101 South Mills Avenue; 150 East Eighth Street; 800 Dartmouth Avenue; 139 East Seventh Street; campuses of The Claremont Colleges located on or near Dartmouth Avenue, Seventh Street, Tenth Street, Eleventh Street, and Twelfth Street; Sixth Street and Mills Avenue; 450 North College Way; 231 East Tenth Street; 701 North College Way; College Way and Eighth Street; 655 North Dartmouth Avenue; 175 East Eighth Street; 139 Seventh Street; 747 North Dartmouth Avenue; and on and along Eighth Street from College Avenue to Dartmouth Avenue and on and along Mills Avenue from Platt Boulevard to Ninth Street.
The CMFA was created on January 1, 2004 pursuant to a joint powers agreement to promote economic cultural and community development, through the financing of economic development and charitable activities throughout California. To date, over 350 municipalities have become members of CMFA, including the City of Claremont.
The CMFA was formed to assist local governments, non-profit organizations, and businesses with the issuance of taxable and tax-exempt financing aimed at improving the standard of living in California. The CMFA' s representatives and its Board of Directors have considerable financing experience.
The Joint Exercise of Power Agreement provides that the CMFA is a public entity, separate and apart from each member executing such agreement. The debts, liabilities, and obligations of the CMFA do not constitute debts, liabilities or obligations of the member executing such agreement.
The bonds to be issued by the CMFA will be the sole responsibility of the Borrower, and the City will have no financial, legal, moral obligation, liability or responsibility for the repayment of the bonds. All financing documents with respect to the issuance of the bonds will contain clear disclaimers that the bonds are not an obligation of the City.
Participation by the City in the approval of this financing will not constitute any type of indebtedness by the City. Outside of holding the TEFRA hearing and adopting the required resolution, no other participation or activity of the City or the City Council with respect to the issuance of the bonds will be required.
RELATIONSHIP TO CITY PLANNING DOCUMENTS
Staff has evaluated the agenda item in relationship to the City's strategic and visioning documents and finds that it does not apply to any of the City's planning documents.
CEQA REVIEW
This item is not subject to environmental review under the California Environmental Quality Act (CEQA).
PUBLIC NOTICE PROCESS
Notice of the public hearing was published on August 28, 2026 in the Claremont Courier. The agenda and staff report for this item have been posted on the City website and distributed to interested parties. If you desire a copy, please contact the City Clerk’s Office.
Submitted by:
Jeremy Starkey
Finance Director
Attachment:
Claremont Colleges TEFRA Resolution