HomeMy WebLinkAbout2013-018 Council ResolutionCITY OF LINO LAKES, MINNESOTA
RESOLUTION NO. 13-18
DECLARING THE OFFICIAL INTENT OF THE
CITY OF LINO LAKES TO REIMBURSE
CERTAIN EXPENDITURES FROM THE PROCEEDS
OF BONDS TO BE ISSUED BY THE CITY
WHEREAS, the Internal Revenue Service has issued Treas. Reg. § 1.150 -2 (the
"Reimbursement Regulations ") providing that proceeds of tax- exempt bonds used to reimburse
prior expenditures will not be deemed spent unless certain requirements are met; and
WHEREAS, the City expects to incur certain expenditures that may be financed temporarily
from sources other than bonds, and reimbursed from the proceeds of a tax- exempt bond;
WHEREAS, the City has determined to make this declaration of official intent
( "Declaration ") to reimburse certain costs from proceeds of bonds in accordance with the
Reimbursement Regulations.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
LINO LAKES AS FOLLOWS:
1. The City proposes to undertake improvements to Otter Lake Road (the
"Project ").
2. The City reasonably expects to reimburse the expenditures made for certain
costs of the Project from the proceeds of bonds in an estimated maximum principal amount
of $732,500. All reimbursed expenditures will be capital expenditures, costs of issuance of
the bonds, or other expenditures eligible for reimbursement under Section 1.150- 2(d)(3) of
the Reimbursement Regulations.
3. This Declaration has been made not later than 60 days after payment of any
original expenditure to be subject to a reimbursement allocation with respect to the proceeds of
bonds, except for the following expenditures: (a) costs of issuance of bonds; (b) costs in an
amount not in excess of $100,000 or 5 percent of the proceeds of an issue; or (c) "preliminary
expenditures" up to an amount not in excess of 20 percent of the aggregate issue price of the issue
or issues that finance or are reasonably expected by the City to finance the project for which the
preliminary expenditures were incurred. The term "preliminary expenditures" includes
architectural, engineering, surveying, bond issuance, and similar costs that are incurred prior to
commencement of acquisition, construction or rehabilitation of a project, other than land
acquisition, site preparation, and similar costs incident to commencement of construction.
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4. This Declaration is an expression of the reasonable expectations of the City based
on the facts and circumstances known to the City as of the date hereof. The anticipated original
expenditures for the Project and the principal amount of the bonds described in paragraph 2 are
consistent with the City's budgetary and financial circumstances. No sources other than proceeds
of bonds to be issued by the City are, or are reasonably expected to be, reserved, allocated on a
long -term basis, or otherwise set aside pursuant to the City's budget or financial policies to pay
such Project expenditures.
5. This Declaration is intended to constitute a declaration of official intent for
purposes of the Reimbursement Regulations.
Adopted by the Council of the City of Lino Lakes this 28 day of Jan , 2013.
The motion for the adoption of the foregoing resolution was introduced by Council Member
Roeser and was duly seconded by Council Member O' Donnell and
upon vote being taken thereon, the following voted in favor thereof:
Roeser, O'Donnell, Rafferty, Stoesz, Reinert
The following voted against same:
none
ATTEST:
Juli.nne Bartell, C. Clerk
Jeff Rei e S ayor
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STAFF ORIGINATOR:
MEETING DATE:
TOPIC:
CITY COUNCIL
AGENDA ITEM 6Av
Michael Grochala
January 28, 2013
Consideration of Resolution No. 13 -08,
Declare Intent to Bond. Otter Lake
Improvement Project
VOTE REQUIRED: 3/5
INTRODUCTION
Road
The improvement project to extend Otter Lake Road is planned to commence in summer of 2013.
Staff is requesting council approval to declare the City's intent to bond for the proposed
improvements.
BACKGROUND
The Otter Lake project was initiated by the City Council in May of 2011. The estimated project
cost is $732,500. WSB and Associates have completed the preparation of plans and the city has
begun the land acquisition process.
The project is proposed to be funded by special assessments and financed by the issuance of
General Obligation Improvement Bonds. The Internal Revenue Code requires cities to declare
their intent to reimburse project costs from bond proceeds prior to encumbering project costs.
Preliminary expenditures such as architectural, engineering, surveying, bond issuance, and similar
costs are exempt from this provision.
This is a non - binding declaration that must take place in order to finance projects in this manner.
RECOMMENDATION
Staff is recommending adoption of Resolution No. 13 -48.
ATTACHMENTS
1. Resolution No. 13 -08