Page 361 - FY 2020-21 Blue Book Volume II

CAPITAL FINANCE ADMINISTRATION FUND

BASIS FOR THE PROPOSED BUDGET

The 2020-21 Proposed Budget for the Capital Finance Administration (CFA) Fund relates to current year funding
as follows:

Amount % Change

2019-20 Adopted Budget $ 255,251,449

2020-21 Proposed Budget $ 240,004,935

Change from 2019-20 Budget $ (15,246,514) (6.0%)

The CFA Fund is a special purpose fund established to consolidate long-term City debt financing program
expenditures, excluding general obligation bonds and revenue bonds. These financing programs mostly use a
lease or "lease purchase" paid from General Fund appropriations and the sale of public securities (either lease
revenue bonds, notes, or certificates of participation) to acquire various facilities and capital equipment items for
use by City departments.

The CFA Fund is administered by the City Administrative Officer. Budgeted within the CFA Fund are the lease
payments required by each financing's lease and trust indenture, as well as any trustee fees or other
administrative expenses required under the terms of the financing. All unencumbered balances remaining at the
end of the fiscal year revert to the Reserve Fund. All items within this budget are a requirement of the respective
leases and trust indentures. The financings were primarily issued through the Municipal Improvement Corporation
of Los Angeles (MICLA).

BUDGET HIGHLIGHTS

The Proposed Budget reflects the following line items:
1. The final lease payment for the MICLA Lease Revenue Bonds, Series 2009-C (Capital Equipment) paid in
2019-20 (line item no. 2).

2. The final lease payment for the MICLA Lease Revenue Bonds, Series 2009-D (Recovery Zone Econ.
Dev. Bonds) (line item no. 3) paid in 2019-20 as a result of their refunding by the MICLA Lease Revenue
Bonds, Series 2019-B (Real Property).
3. A one-time, $5 million budget reduction to Refunding of Commercial Paper (line item no. 35) by
structuring the MICLA 2020 Bonds, which are expected to be issued in August 2020, to have a single
debt service payment in fiscal year 2020-21 and amortizing the second debt service payment over the life
of the bonds.

4. A one-time, $5.5 million budget reduction to MICLA 2016-B (Refunding) (line items no. 19 through 22) by
applying unexpended bond proceeds from the MICLA 2016-B Bonds to the November 2020 debt service
payment.

823