Cucamonga Valley Water District Financing Authority Water Revenue Bonds, Series 2018A

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Cucamonga Valley Water District Financing Authority Water Revenue Bonds, Series 2018A PRELIMINARY OFFICIAL STATEMENT DATED APRIL 25, 2018 NEW ISSUE – BOOK-ENTRY ONLY RATINGS: S&P: AA FITCH: AA See the caption “RATINGS” In the opinion of Stradling Yocca Carlson & Rauth, a Professional Corporation, Bond Counsel, under existing statutes, regulations, rulings and judicial decisions, and assuming the accuracy of certain representations and compliance with certain covenants and requirements described in this Official Statement, interest (and original issue discount) on the 2018A Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of calculating the federal alternative minimum tax imposed on individuals. In the opinion of Bond Counsel, under existing statutes, regulations, rulings and judicial decisions, interest on the 2018B Bonds is not excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended. In the further opinion of Bond Counsel, interest (and original issue discount) on the 2018A Bonds and the 2018B Bonds is exempt from State of California personal income tax. See the caption “TAX EXEMPTION.” $9,095,000* $64,225,000* CUCAMONGA VALLEY WATER DISTRICT CUCAMONGA VALLEY WATER DISTRICT FINANCING AUTHORITY FINANCING AUTHORITY WATER REVENUE BONDS, WATER REVENUE REFUNDING BONDS, SERIES 2018A SERIES 2018B (FEDERALLY TAXABLE) Dated: Date of Delivery Due: September 1, as shown on inside front cover The Bonds are being issued by the Authority in fully registered form and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York. Individual purchases will be made in integral multiples of $5,000 and will be in book‑entry form only. Purchasers of the Bonds will not receive certificates representing their beneficial ownership in the Bonds but will receive credit balances on the books of their respective nominees. Interest on the Bonds is payable on September 1, 2018 and each March 1 and September 1 thereafter. Payment of the principal of and interest on the Bonds is to be made to Cede & Co., which is to disburse said payments to the Beneficial Owners of the Bonds through their nominees. The Bonds are subject to optional redemption as more fully described in this Official Statement. The 2018A Bonds are being issued to provide funds: (i) to finance the acquisition of certain improvements for the Water System of the Cucamonga Valley Water District, a member of the Authority; and (ii) to pay costs incurred in connection with the issuance of the 2018A Bonds. The 2018B Bonds are being issued to provide funds: (i) to defease a portion of the outstanding Cucamonga Valley Water District Water Revenue Refunding Bonds, 2011 Series A; and (ii) to pay costs incurred in connection with the issuance of the 2018B Bonds. The Bonds are being delivered pursuant to the Indenture of Trust, dated as of June 1, 2018, by and between the Authority and U.S. Bank National Association, as trustee. The Bonds are special limited obligations of the Authority payable solely from Receipts and certain other amounts on deposit in the funds and accounts established under the Indenture. Receipts consist primarily of Installment Payments received by the Trustee, as assignee of the Authority, from the District pursuant to the Installment Purchase Agreement (Series 2018), dated as of June 1, 2018, by and between the District and the Authority. NEITHER THE FULL FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OF CALIFORNIA OR ANY OF ITS POLITICAL SUBDIVISIONS OR ANY MEMBER OF THE AUTHORITY NOR ANY REVENUES OR FUNDS OF THE AUTHORITY OTHER THAN THE RECEIPTS ARE PLEDGED TO OR AVAILABLE FOR THE PAYMENT OF DEBT SERVICE ON THE BONDS. THE OBLIGATION OF THE AUTHORITY TO MAKE PAYMENTS OF PRINCIPAL AND INTEREST ON THE BONDS DOES NOT CONSTITUTE AN OBLIGATION FOR WHICH THE AUTHORITY IS OBLIGATED TO LEVY OR PLEDGE ANY FORM OF TAXATION OR FOR WHICH THE AUTHORITY HAS LEVIED OR PLEDGED ANY FORM OF TAXATION. THE AUTHORITY HAS NO TAXING POWER. THE BONDS DO NOT CONSTITUTE A DEBT, LIABILITY OR OBLIGATION OF THE STATE OF CALIFORNIA OR ANY OF ITS POLITICAL SUBDIVISIONS (OTHER THAN THE AUTHORITY) OR ANY MEMBER OF THE AUTHORITY WITHIN THE MEANING OF ANY STATE CONSTITUTIONAL OR STATUTORY PROVISION. The obligation of the District to make the Installment Payments is a special obligation of the District payable solely from Net Revenues, consisting of Revenues of the District’s Water System remaining after payment of Maintenance and Operation Costs, on a basis subordinate to Senior Obligations that are currently outstanding in the total aggregate principal amount of $33,311,428* (assuming the defeasance of a portion of the Cucamonga Valley Water District Water Revenue Refunding Bonds, 2011 Series A on the date of issuance of the 2018B Bonds as described herein) and on a parity with Parity Obligations that are currently outstanding in the total aggregate principal amount of $63,975,000. NOTWITHSTANDING ANYTHING CONTAINED IN THE MASTER INSTALLMENT PURCHASE AGREEMENT, DATED AS OF OCTOBER 1, 2012, BY AND BETWEEN THE DISTRICT AND THE AUTHORITY, OR THE INSTALLMENT PURCHASE AGREEMENT, THE DISTRICT IS NOT REQUIRED TO ADVANCE ANY MONEYS DERIVED FROM ANY SOURCE OF INCOME OTHER THAN NET REVENUES AND THE OTHER FUNDS PROVIDED IN THE MASTER AGREEMENT AND THE INSTALLMENT PURCHASE AGREEMENT FOR THE PAYMENT OF THE INSTALLMENT PAYMENTS, AND OTHER PAYMENTS REQUIRED TO BE MADE BY IT THEREUNDER, OR FOR THE PERFORMANCE OF ANY AGREEMENTS OR COVENANTS REQUIRED TO BE PERFORMED BY IT CONTAINED THEREIN. The District has covenanted in the Master Agreement not to issue any additional obligation which is payable on a basis senior to the Installment Payments, and not to issue any additional obligation on a parity with any Senior Obligation. The District may issue obligations payable from Net Revenues on a parity with or subordinate to the Installment Payments, subject to the terms set forth in the Master Agreement. THIS COVER PAGE CONTAINS CERTAIN INFORMATION FOR REFERENCE ONLY. IT IS NOT A SUMMARY OF THIS ISSUE. INVESTORS MUST READ THE ENTIRE OFFICIAL STATEMENT TO OBTAIN INFORMATION ESSENTIAL TO THE MAKING OF AN INFORMED INVESTMENT DECISION. MATURITY SCHEDULE (See inside front cover) The Bonds are offered when, as and if delivered and received by the Underwriter, subject to approval as to legality by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, acting as Bond Counsel, and certain other conditions. Certain legal matters will be passed upon for the District and the Authority by Best Best & Krieger LLP, Riverside, California, for the District by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, acting as Disclosure Counsel, for the Underwriter by Katten Muchin Rosenman LLP, New York, New York, and for the Trustee by its counsel. It is anticipated that the Bonds will be available for delivery through the facilities of The Depository Trust Company on or about June 7, 2018. BofA Merrill Lynch Dated: May __, 2018 This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These securities may not be sold, nor may offers to buy them be accepted, prior to the time the Official Statement is delivered prior accepted, be buy them delivered is Statement Official the time to the to offers nor may sold, be not securities These may This Preliminary amendment. or completion to are subject herein contained the information and Statement Official solicitation or of, these securitiesany jurisdiction in in which such offer, any sale nor shall there be buy, to Under no circumstances shall this Preliminary to sell or the solicitation of an offer Official Statement constitute an offer form. in final be unlawful. sale would * Preliminary, subject to change. MATURITY SCHEDULE BASE CUSIP®†_____ $9,095,000* CUCAMONGA VALLEY WATER DISTRICT FINANCING AUTHORITY WATER REVENUE BONDS, SERIES 2018A Maturity Principal Interest (September 1)* Amount* Rate Yield Price CUSIP®† 2032 $2,110,000 % % 2033 2,215,000 2034 2,330,000 2035 2,440,000 $64,225,000* CUCAMONGA VALLEY WATER DISTRICT FINANCING AUTHORITY WATER REVENUE REFUNDING BONDS, SERIES 2018B (FEDERALLY TAXABLE) Maturity Principal Interest (September 1)* Amount* Rate Yield Price CUSIP®† 2018 $3,100,000 % % 2019 2,470,000 2020 2,535,000 2021 2,610,000 2022 2,680,000 2023 4,440,000 2024 5,295,000 2025 5,480,000 2026 5,665,000 2027 5,870,000 2028 6,060,000 2029 6,280,000 2030 6,510,000 2031 5,230,000 * Preliminary, subject to change. † CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by S&P Capital IQ. Copyright© 2018 CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP® numbers are provided for convenience of reference only. None of the Authority, the District or the Underwriter takes any responsibility for the accuracy of such numbers. CUCAMONGA VALLEY WATER DISTRICT FINANCING AUTHORITY BOARD OF DIRECTORS James V. Curatalo, Jr., Chair Luis Cetina, Vice Chair Oscar Gonzalez, Director Randall Reed, Director Kathleen J. Tiegs, Director CUCAMONGA VALLEY WATER DISTRICT BOARD OF DIRECTORS James V. Curatalo, Jr., President Luis Cetina, Vice President Oscar Gonzalez, Director Randall Reed, Director Kathleen J. Tiegs, Director DISTRICT STAFF Martin E. Zvirbulis, General Manager/Chief Executive Officer John Bosler, Assistant General Manager Carrie Corder, Assistant General Manager GENERAL COUNSEL Best Best & Krieger LLP Riverside, California SPECIAL SERVICES Bond Counsel and Disclosure Counsel Municipal Advisor Stradling Yocca Carlson & Rauth, Fieldman, Rolapp & Associates, Inc. a Professional Corporation Irvine, California Newport Beach, California Trustee Verification Agent U.S.
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