2010-031 Council Resolution - Laserfiche WebLink

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• City of Lino Lakes, Minnesota April 1, 2010 (c) Economic Life 11. Continuing Disclosure each year to a permitted carry over equal to the greater of the investment earnings in the fund during the prior year or 1/12 the debt service of the prior year. Diligence should be exercised in monitoring the debt service fund for the Bonds due to the potential accumulation of assessment prepayments, which could cause the debt service fund to become non -bona fide. Additionally, all original proceeds of bonds and interest earnings on those proceeds must be expended within three years, or the remaining proceeds will be subject to yield restriction. The City should monitor the project fund of the Bonds to ensure yield restriction provisions of the federal arbitrage rules are met. Springsted currently provides arbitrage compliance services for the City under a separate contract. An amendment to that contract adding the Bonds has been provided to City staff. The average life of the Bonds cannot exceed 120% of the economic life of the projects to be financed. The average life of the Bonds is less than the remaining average life of the bonds being refunded; therefore, the Bonds are within the economic life requirements. The Bonds are subject to continuing disclosure requirements set forth by the Securities and Exchange Commission. The SEC rules require the underwriter of the Bonds to provide an annual update of certain Official Statement information and report any material events to bond holders. The purchaser therefore requires the City to commit to providing such information under a continuing disclosure agreement or "undertaking." If the City does not enter into such an agreement prior to the offering of the debt, underwriters will not offer a bid to purchase the Bonds. Springsted currently provides continuing disclosure services for the City under a separate contract. An amendment to that contract adding this Issue has been provided to City staff. Page 4