HomeMy WebLinkAbout2004-171 Council Resolution•
CITY OF LINO LAKES, MINNESOTA
RESOLUTION NO. 04-171
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; and
WHEREAS, by Resolution No. 04 -42 approved January 12, 2004 (the "Prior
Resolution "), the City Council approved a resolution declaring its intent to reimburse from
bond proceeds for the cost of public improvements related to the Legacy at Woods Edge
project; and
WHEREAS, in order to comply with the Reimbursement Regulations in all
respects, the City Council has determined to make this declaration of official intent
( "Declaration ") to reimburse certain costs from proceeds of bonds.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF LINO LAKES AS FOLLOWS:
1. The City proposes to undertake the following projects (the
"Project ").
Legacy at Woods Edge Public Improvements
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 $8,500,000. 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
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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.
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 Tong -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.
6. This Declaration supersedes the Prior Resolution in all respects.
Approved by the City Council of the City of Lino Lakes this day of
Alb y _ , 2004.
Attest:
City Clerk, Ann
lair
CITY OF LINO LAKES, MINNESOTA
Mayor, YJ'ohn Be' geso
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STAFF ORIGINATOR:
CITY COUNCIL
MEETING DATE:
TOPIC:
VOTE REQUIRED:
BACKGROUND:
AGENDA ITEM •E
Michael Grochala
November 8, 2004
Resolution No. 04 -171,
Declare Intent to Bond. Legacy at Woods Edge
3/5 - simple majority
The internal Revenue Code requires Cities to declare its intent to reimburse project
costs from bond proceeds prior to encumbering project costs. This is a non- binding
declaration that must take place in order to finance projects in this manner.
The City Council approved Resolution No. 04 -42 Declaring the City's Intent to Bond for
the Legacy at Woods Edge improvements in March of 2004. However, due to changes
in the regulatory citations governing such requirements the City's bond consul has
recommended adopting a new updated resolution.
RECOMMENDATION
Staff is recommending adoption of Resolution No. 04 -171
ATTACHMENTS
1. Resolution No. 04 -171