Microbond Financing Program

Agency: City of Berkeley
State: California
Type of Government: State & Local
Posted Date: Jan 22, 2020
Due Date: Feb 27, 2020
Solicitation No: 20-11365-C
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specification # Title/description & related specification files due date contact
20-11365-C Microbond Financing Program 1/23/2020 2/27/2020 Filippo De Luca
Addendum A
Addendum B

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Finance Department
General Services Division
Specification No. 20-11365-C
Dear Proposer:
The City of Berkeley is soliciting written proposals from qualified firms or individuals able to provide full services
for the establishment and execution of a pilot microbond financing program for future City projects such that
services will entail development through implementation of an actual project(s) that is focused on encouraging
local participation and leverages emerging technologies. As a Request for Proposal (RFP) this is not an invitation
to bid and although price is very important, other factors will be taken into consideration.
The project scope, content of proposal, and vendor selection process are summarized in the RFP (attached).
Proposals must be received no later than 2:00 pm, on Thursday, January 23, 2020. All responses must be in a
sealed envelope and have “Microbond Financing Program” and Specification No. 20-11365-C clearly marked
on the outer most mailing envelope. Please submit one (1) unbound original, three (3) unbound copies and one (1)
electronic copy on USB stick of the proposal as follows:
Mail or Hand Deliver To:
City of Berkeley
Finance Department/General Services Division
2180 Milvia Street, 3rd Floor
Berkeley, CA 94704
Proposals will not be accepted after the date and time stated above. Incomplete proposals or proposals that do not
conform to the requirements specified herein will not be considered. Issuance of an RFP does not obligate the City
to award a contract, nor is the City liable for any costs incurred by the proposer in the preparation and submittal of
proposals for the subject work. The City retains the right to award all or parts of a contract to several bidders, to not
select any bidders, and/or to re-solicit proposals. The act of submitting a proposal is a declaration that the proposer
has read the RFP and understands all the requirements and conditions.
Any information submitted in response to this RFP that a respondent believes are trade secrets or
commercial or financial information which is of a privileged or confidential nature should be clearly marked
as such. Explanations are advised briefly describing why each portion of information so marked are requested to be
withheld from public disclosure. Note: Information marked confidential but determined not to fall within the
category of trade secrets or commercial or financial information of a privileged or confidential nature is
subject to release.
For questions concerning the anticipated work, or scope of the project, please contact Filippo De Luca, Senior
Buyer, via email at fdeluca@cityofberkeley.info no later than Friday, December 20, 2019. Answers to questions
will not be provided by telephone or email. Rather, answers to all questions or any addenda will be posted on the
City of Berkeley’s site at http://www.cityofberkeley.info/ContentDisplay.aspx?id=7128. It is the vendor’s
2180 Milvia Street, Berkeley, CA 94704 Tel: 510.981.7320 TDD: 510.981.6903 Fax: 510.981.7390
E-mail: finance@ci.berkeley.ca.us Website: http://www.ci.berkeley.ca.us/finance
City of Berkeley
Microbond Financing Program
Specification No. 20-11365-C
Page 3 of 24
Release Date: 12/5/19
The City of Berkeley (“City) is located in Alameda County on the east side of the San Francisco Bay. At the
geographic midpoint of the greater San Francisco Bay Area, the City is 20 minutes (or 10 miles away) from
San Francisco and within easy proximity to population centers in Contra Costa County and Silicon Valley.
Encompassing 17.7 square miles and with a resident population of approximately 122,234, Berkeley has the
highest population density of any city in the East Bay region. The City is defined to a large degree, both
culturally and economically, by the presence of the University of California campus located on the eastern
side of the City.
The City operates under its own charter with a Council/Manager form of government. The City Council
consists of eight Councilmembers elected for four-year terms, and one Mayor elected "at large" for a four-
year term. The City provides a comprehensive set of community services common to similar-sized California
cities such as public safety (police and fire); sanitation and sewer; public maintenance and infrastructure;
leisure (parks, recreation and marina); animal control; planning and zoning; general and administrative
services, and housing advocacy and support services. In addition, the City offers support services for public
health and human services; and operates a city-owned public library system.
The Mayor and Council select and confirm the City Manager, who acts as a Chief Executive Officer for the
rest of the City government. The City Manager is responsible for the administration of City services and
programs, enforcement of the City's Municipal Code and ordinances, and preparation of the annual budget.
Department directors are selected by the City Manager and confirmed by the City Council.
The City employs a two-year budget process. In year one of the biennial budget cycle, the City Council
formally adopts authorized appropriations for the first year of the two-year budget and approves “planned”
appropriations for the second fiscal year. In year two of the budget cycle, the City Council considers revisions
and formally adopts authorized appropriations for the second fiscal year. Although the budget cycle covers a
two-year period, the City Charter requires that the City Council adopt an annual appropriations ordinance for
each budget year.
The City’s fiscal year 2019 budget extending from July 1, 2018 through to June 30, 2019 is $474 million, of
which $171 million is allocated from the General Fund. The City has a workforce of 1,530 full-time
equivalent employees.
More information is available in the City located at the link below:
The City of Berkeley, Department of Finance provides direct services to the entire Berkeley community, that is,
approximately 122,324 residents and more than 11,000 businesses. The Department's mission is,
“To conduct all of our responsibilities with integrity, warrant and receive the trust of colleagues and
constituents, and to positively support the delivery of quality services to fulfill the City’s mission and
citywide priorities. Within the framework of full disclosure and quality customer service, our principal
obligations are to safeguard City assets, maximize revenues, manage the business of City programs, and
provide accurate, timely, and complete financial information.”
The City is soliciting responses from individuals and firms (collectively, “firms”) able to provide full begin-to-end
services for the establishment and execution of a pilot Microbond Financing Program (“Program”) for future City
projects – i.e., joint ventures and partnerships are encouraged to fulfill the entirety of this Scope of Services
(see Section II). Rendered services will entail development through implementation of an actual project(s) and be
focused on encouraging local participation and leverage employment of emerging technologies. The City
anticipates an initial pilot financing, estimated between $2M-$5M dollars through the Program for the purpose of
Revised Oct2019
City of Berkeley
Microbond Financing Program
Specification No. 20-11365-C
Page 4 of 24
Release Date: 12/5/19
acquiring high value City assets such as fire trucks, garbage trucks, and other material well suited for this type of
financing program.
Given the City’s history of being an early adopter of innovative public finance solutions, the City is exploring the
use of emerging technologies for marketing, issuance, and ongoing administration of microbonds. Accordingly, the
City anticipates that microbonds will be marketed and sold through a technological platform that has the ability to
issue microbonds in very small increments, track secondary market trades, and provide for additional ongoing bond
To maximize local investor participation, the City anticipates small bond denominations (denominations as low as
$100 have been discussed) and the City intends to limit participation in the initial microbond offering to local retail
bond investors to benefit Berkeley residents and businesses.
Additionally, the selected firm(s) will provide ongoing support with on-demand real-time audit functionality,
ensure continued regulatory compliance, and re-issue bonds if lost or stolen. A firm’s ability to provide a secondary
market will be an additional consideration in the selection process.
More information about the City’s objectives for the Program can be found at the following:
1. Staff Report for June 25, 2019 Meeting
2. Recording of June 25,2019 City Council Meeting (refer to Item # 47 on the Agenda)
Pursuant to this RFP the City anticipates making an award to qualified and experienced firm(s) with a contract
through the completion of the financing and final payment of outstanding bonds. Additionally, the City reserves the
right to award contracts to more than one firm for some or all of the services outlined in Section II. Assignments to
awarded consultants will be based on the suitability of the consultant for the work required; however, the City
reserves the right to issue task order specific requests for proposals to which two (2) or more of the awarded
consultants may submit competitive proposals. Firms are encouraged to create joint-ventures/partnerships as
needed to provide the full scope of services requested.
The City anticipates commencing the Program with the selection of qualified firm(s). Given the ongoing nature of
Item 4 in the Scope of Services below, the contract(s) is anticipated to extend through the final maturity of the
microbonds. The City expects the selected firm(s) to provide the services outlined below for the agreed-upon
payment. The anticipated Scope of Services for the Program include the following:
1. Assist the City in Developing an Innovative, Community-Supported Financing Platform Utilizing
Emerging and/or Established Technologies.
The Program will consist of multiple phases, including pre-sale marketing, bond sale, and ongoing bond
administration. The Program will meet several objectives, including the following:
a. Use of an emerging technology platform as a means to crowdsource participation, sell the bonds,
and help administer the Program
b. Increased local participation in the financing and increased benefit for Berkeley residents from
local bond ownership
c. Exploring potential additional microbond functionality beyond its use as an investment product
2. Design and Create Bond Sale and Administration Platform
Revised Oct2019
City of Berkeley
Microbond Financing Program
Specification No. 20-11365-C
Page 5 of 24
Release Date: 12/5/19
Design and create a secure, online platform(s) for marketing, bond sale, and ongoing bond administration.
This phase will require multiple communications and meetings with City staff and other consultants. The
online platform(s) should have the following capabilities:
a. Market the City’s Program and microbonds as outlined in Item 2 of this Scope of Services
b. Facilitate sale of the bonds as outlined in Item 3 of this Scope of Services
i. Ability to work with bonds in very small denominations
c. Administer the bonds on an ongoing basis utilizing blockchain or another digital ledger technology
as outlined in Item 4 of this Scope of Services
d. Facilitate secondary market trading among investors
e. Ability to provide on-demand audits and reports detailing various metrics including (number of
bond investors, secondary market trading activity, geographical location of current bond owners,
f. Ability to communicate easily with investors to facilitate reporting of significant events and annual
disclosure requirements
g. Ability to ensure all relevant laws and rules are adhered to and all legal and reporting requirements
are met
3. Pre-Sale Marketing
a. Work with City staff and consultants to develop marketing pitch and material for the Program
i. Tailor marketing material to increase buy-in from investors who do not typically
participate or have not participated in a traditional bond offering
b. Distribute marketing materials, targeting Berkeley residents
c. Provide on-demand feedback of marketing campaigns (e.g. responses, views, or other metrics)
4. Bond Sale
a. Assist in the preparation and review of legal and financing documents in coordination with the City
Attorney, bond counsel, underwriter's counsel (if any), disclosure counsel, City staff, and other
relevant parties. These documents shall include regulations, rules, proposed legislation, and other
documents relating to the City's financing program.
b. Assist in preparation of preliminary and final official statements, notices of sale, and other
disclosure documents as necessary
c. Assist City staff, bond/disclosure counsel and the municipal advisor in structuring the microbonds
d. As necessary, work with the City’s municipal advisor to resolve issues communicated from
prospective purchasers, rating agencies, or public officials regarding the sale and issuance of bonds
e. Serve as broker-dealer for the bond sale, managing the bond sale process
i. At this time, the City desires to limit the bond offering to Berkeley residents
f. Provide other customary underwriting services
g. Prepare comprehensive after-bond-sale report detailing key metrics of the sale
h. After bond sale, continue to provide secondary market liquidity for the microbonds
5. Ongoing Bond Administration
a. Monitor secondary market trades and maintain an up-to-date database of current bond owners
b. Serve as the City’s paying agent and ensure that interest and principal payments to bond owners are
made on time
c. As necessary resolve issues raised by bond owners and maintain methods of communication with
bond owners
d. Prepare detailed reports – upon request – including details on secondary market activity, make-up of
current bond owners, etc.
e. Work with the City’s dissemination agent to distribute significant events’ notices, when necessary,
and annual disclosure reports to bond owners
f. Undertake any steps necessary to ensure ongoing security and integrity of the online platform
g. Develop platform to provide secondary market sales and purchases (investor liquidity)
Revised Oct2019

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