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1 <br /> <br />CITY COUNCIL <br />REGULAR MEETING STAFF REPORT <br />AGENDA ITEM 3E <br /> <br />STAFF ORIGINATOR: Michael Grochala, Community Development Director <br /> <br />MEETING DATE: March 24, 2025 <br /> <br />TOPIC: Declaring Intent to Reimburse with Bond Proceeds <br /> <br />i. Consider Resolution No. 25-155, Declaring Intent to <br />Reimburse Certain Expenditures from Bond Proceeds, <br />Public Works Building <br />ii. Consider Resolution No. 25-156, Declaring Intent to <br />Reimburse Certain Expenditures from Bond Proceeds, <br />Otter Lake Road Extension Project <br /> <br />VOTE REQUIRED: Simple Majority <br />______________________________________________________________________________ <br /> <br />INTRODUCTION <br /> <br />Staff is requesting council approval to declare the City’s intent to reimburse itself from bond <br />proceeds for the proposed 2026 Capital Improvement Projects. <br /> <br />BACKGROUND <br /> <br />The City is in the process of preparing plans and specifications for the reconstruction of the <br />Public Works Building and the Otter Lake Road Extension project. Both projects are proposed <br />for improvement in 2026. <br /> <br />The Public Works Building is proposed to be financed by the issuance of Lease Revenue Bonds. <br />The Otter Lake Road Extension project is proposed to be financed by a combination of General <br />Obligation and Utility Revenue Bonds. <br /> <br />The Internal Revenue Code requires cities to declare their intent to reimburse project costs <br />incurred prior to receipt of bond proceeds. Preliminary expenditures such as architectural, <br />engineering, surveying, bond issuance, and similar costs are exempt from this provision. <br />Reimbursement of land and construction costs requires the resolution. The total amount of <br />bonds issued may be less than the authorized limit. <br /> <br />Approval of the reimbursement bond resolution does not obligate the City to issue bonds. <br /> <br />Page 50 of 101