07/24/2006 Council Packet - Laserfiche WebLink

Home Search

Kennedy Graven CHARTERED PROPOSED FORMS OF LEGAL OPINIONS 470 Pillsbury Center 200 South Sixth Street Minneapolis MN 55402 (612) 337 -9300 telephone (612) 337-9310 fax http://www.kennedy-graven.com $2,460,000* General Obligation Tax Abatement Bonds, Series 2006C City of Lino Lakes Anoka County, Minnesota APPENDIX I We have acted as bond counsel to the City (the "Issuer ") in connection with the issuance by the Issuer of its General Obligation Tax Abatement Bonds, Series 2006C, (the "Bonds "), originally dated as of August 15, 2006, and issued in the original aggregate principal amount of $ . In such capacity and for the purpose of rendering this opinion we have examined certified copies of certain proceedings, certifications and other documents, and applicable laws as we have deemed necessary. Regarding questions of fact material to this opinion, we have relied on certified proceedings and other certifications of public officials and other documents furnished to us without undertaking to verify the same by independent investigation. Under existing laws, regulations, rulings and decisions in effect on the date hereof, and based on the foregoing we are of the opinion that: 1.The Bonds have been duly authorized and executed, and are valid and binding general obligations of the Issuer, enforceable in accordance with their terms. 2. The principal of and interest on the Bonds are payable from tax abatement revenues and ad valorem taxes, but if necessary for the payment thereof additional ad valorem taxes are required by law to be levied on all taxable property in the City, which taxes are not subject to any limitation as to rate or amount. 3.Based on federal and State of Minnesota laws, as presently enacted and construed, interest on the Bonds is not includable in gross income for federal income tax purposes and is not includable, to the same extent, in net taxable income for State of Minnesota income tax purposes. Interest on the Bonds is includable in taxable income of corporations and financial institutions for purposes of the State of Minnesota franchise tax. Interest on the Bonds is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations and the State of Minnesota alternative minimum tax applicable to individuals, estates, and trusts. Interest on the Bonds is includable in the adjusted current earnings of certain corporations for the purposes of the federal and State of Minnesota altemative minimum taxes imposed on corporations. The opinion set forth in this paragraph is subject to the condition that the Issuer and the YMCA of Greater St. Paul (the "YMCA ") comply with all requirements of the Internal Revenue Code of 1986, as amended (the "Code "), that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon be (or continue to be) excluded from gross income for federal income tax purposes. Failure to comply with such requirements of the Code could cause the interest on the Bonds to be included in gross income for federal income tax purposes and in net taxable income for State of Minnesota income tax purposes, retroactive to the date of issuance of the Bonds. The Issuer and YMCA have covenanted to comply with such requirements. We express no opinion regarding other federal or state tax consequences arising with respect to ownership of the Bonds or caused by the receipt or accrual of interest thereon. In rendering the foregoing opinion, we have relied upon (i) representations of the YMCA as to the application of the proceeds of the Bonds and the nature, use, cost, and economic life of the facilities financed with the proceeds of the Bonds, and (ii) the opinion of Redmon Law, as counsel for the YMCA, that the YMCA has been