HomeMy WebLinkAbout1992-003 Council ResolutionCouncil member Kuether introduced the
following resolution and move its adoption:
CITY OF LINO LAKES
RESOLUTION NO. 92 - 03
RESOLUTION ESTABLISHING PROCEDURES
RELATING TO COMPLIANCE WITH REIMBURSEMENT BOND
REGULATIONS UNDER THE INTERNAL REVENUE CODE
BE IT RESOLVED by the City Council (the "Council") of the City
of Lino Lakes, Minnesota (the "City"), as follows:
1. Recitals.
(a) The Internal Revenue Service has issued
proposed Treasury Regulations Section 1.103-17 (as proposed
and/or finally adopted, the "Regulations") dealing with
reimbursement bond proceeds, which would include those
proceeds of the City's bonds to be used to reimburse the City
for any project expenditure paid by the City prior to the time
of the issuance of those bonds.
(b) The Regulations generally require that the City
make a prior declaration of its official intent to reimburse
itself for such prior expenditures out of the proceeds of
subsequently issued taxable or tax exempt borrowings, that
such declaration generally be made prior to but not more than
two years before the time the expenditure is actually paid,
that the bonding occur and the reimbursement allocation be
made from the proceeds of such bonds within one year of the
payment of the expenditure (or not later than one year after
the project is placed in service, if that is a longer period) ,
and that the expenditure relate to property having a
reasonably expected economic life of at least one year.
(c) The City desires to comply with requirements of
the Regulations and to establish certain procedures relating
thereto.
(d) The City's bond counsel has advised the City
that the Regulations do not apply, and hence the provisions of
this Resolution are intended to have no application, to
payments of City project costs first made by the City out of
the proceeds of bonds issued prior to the date of such
payments.
2. Official Intent Declaration. The Regulations, in the
situations in which they apply, require the City to have made an
official declaration of its reasonable intent (hereinafter referred
to as the "Official Intent Declaration" or the "Declaration") to
reimburse itself for previous paid project expenditures out of the
proceeds of subsequently issued taxable or tax exempt bonds or
other borrowings. The Council hereby authorizes the City
Administrator to make the City's Official Intent Declarations or to
delegate from time to time that responsibility to other appropriate
City employees. Each Declaration shall comply with the
requirements of the Regulations, including without limitation the
following:
(a) Each Declaration shall be made prior to the
time the City pays the applicable project cost and shall state
that the City intends to reimburse itself for the expenditure
out of the proceeds of a taxable or tax exempt" bond issuance,
debt, or similar borrowing. Each Declaration may be made
substantially in the form of the Exhibit A which is attached
to and made a part of this Resolution.
(b) Each Declaration shall and is hereby declared
to be made and filed in the publicly available official books,
records, or proceedings of the City, which shall be
continuously available for inspection by the general public
and maintained or otherwise supervised by the officials
authorized herein to make such Declarations.
(c) Each Declaration shall be available for
inspection at City Hall during normal business hours of the
City on every business day during the period beginning on the
earlier of 10 days after the making of the Declaration or the
date of issuance of the reimbursement bonds and ending on the
day after the issuance of such bonds. Each Declaration shall
contain a reasonably accurate general functional description
of the type and use of the property for which the expenditure
to be reimbursed is paid, including sufficient information so
that a person who is not familiar with the property would
generally understand the nature and function of that property.
(d) Each Declaration shall identify the reasonably
expected source or sources of funds that will be used by the
City to pay the reimbursement expenditure (prior to and in
anticipation of the issuance of the reimbursement bonds),
together with the reasonably expected source or sources of
funds to be used by the City to pay the debt service on the
reimbursement bonds (for example, project revenues, ad valorem
tax revenues, special assessments, grant and loan receipts,
utility revenues, tax increments, and/or other revenues).
(e) Care shall be taken so that the City, or its
authorized representatives under this Resolution, not make
Declarations in cases where the City will not ultimately be
issuing reimbursement bonds to provide long term financing for
the subject project costs, and the City officials are hereby
authorized to consult with bond counsel to the City concerning
the requirements of the Regulations in general and their
application in particular circumstances.
(f) The Council shall be advised from time to time
on the desirability and timing of the issuance of
reimbursement bonds relating to project expenditures for which
the City has made Official Intent Declarations, including
recommendations on the timing of the issuance of such bonds so
that the "reimbursement allocation" described in the
Regulations and in the paragraph 3 below can be made within
the time limits prescribed in the Regulations.
(g) This Resolution shall be deemed to incorporate
any amendments to the proposed Regulations made in connection
with their final adoption, and to the extent that the
provisions of this Resolution may differ from those finally
adopted Regulations, this resolution shall be deemed to have
been amended thereby and to incorporate said revised or
additional requirements.
3. Reimbursement Allocations. The designated City officials
shall also be responsible for making the "reimbursement
allocations" described in the Regulations, being generally the
transfer of the appropriate amount of reimbursement bond proceeds
to reimburse the source of temporary financing used by the City to
make payment of the prior expenditure. Each allocation shall be
evidenced by an entry on the official books of the City maintained
for such reimbursement bonds, shall specifically identify the
actual prior expenditure being reimbursed, and shall be effective
to relieve the bond proceeds involved from any restriction under
the bond resolution or other relevant legal documents for those
bonds and under any applicable state statute which would apply to
the unspent proceeds of such bond issue.
Adopted by the City Council of Lino Lakes this 13th day of January,
1992.
EXHIBIT A
Declaration of Official Intent
The undersigned, being the duly appointed and City
Administrator of the City of Lino Lakes, Minnesota ( the "City"),
pursuant to and for the purpose of compliance with Treasury
Regulations Section 1.103-17 (the "Regulations") under the Internal
Revenue Code of 1986, as amended, hereby states and certifies as
follows:
1. The undersigned has been and is on the date hereof duly
authorized by the governing body of the City, the City Council, to
make and execute this Declaration of Official Intent ( the
"Declaration") for and on behalf of the City.
2. Attached to and made a part of the Declaration is an
Exhibit A itemizing one or more costs (the "Costs"), describing the
project or projects of the City to which each of such Costs
relates, and providing an accurate general functional description
of the type and use of the property to which each of said Costs
relates, including sufficient information on the nature and
function of the underlying property.
3. None of the Costs has heretofore been paid by the City and
none of the Costs will be paid by the City until after the date of
this declaration. Each of the Costs relates to property having a
useful life of at least one year.
4. The City intends to reimburse itself for the payment of
the Costs out of the proceeds of tax exempt debt (the "Bonds") to
be issued by the City after the date of payment of the Costs. In
the meantime, the City reasonably expects to pay and temporarily
finance the Costs from the following source or sources of funds:
5. The reasonably expected sources of funds to be used by the
City to pay the debt service on the bonds are as follows:
6. As of the date hereof, there are no sources of City funds
which are or are reasonably expected to be allocated or available
on a long-term basis, reserved, or otherwise available pursuant to
the City's budget to provide permanent financing for the Costs,
other than pursuant to the subsequent issuance of the Bonds.
Furthermore, there has been no allocation, budgeting, or
restriction of moneys (or the adoption of a requirement or policy
to reimburse a fund) the primary purpose of which is to prevent
moneys from said source to be available on a long-term basis to pay
the Costs. On the basis of the foregoing, the statements and
certifications contained in this Declaration are believed to be
reasonable and accurate, and this Declaration is believed to be
consistent with the City's budgetary and financial circumstances as
they exist or are foreseeable on the date hereof, all within the
meaning and content the regulations.
7. This Declaration is and shall remain a part of the
publicly available official books, records, or proceedings of the
City and shall be continuously available for inspection by the
general public at City Hall during regular City hours for a period
not ending earlier than the day after the issuance of the Bonds.
IN WITNESS WHEREOF, the undersigned has executed this
Declaration and placed it on file i e official City records this
13th day of January, 1992.
City Administrator
City of Lino Lakes, Minnesota
CERTIFICATION
The undersigned, being duly qualified and acting City
Administrator of the City of Lino Lakes, Minnesota, hereby
certifies the following:
The foregoing is true and correct copy of a Resolution on file
and of official, publicly available record in the offices of the
City, which Resolution relates to procedures of the City for
compliance with certain IRS Regulations on reimbursement bonds.
Said Resolution was duly adopted by the governing body of the City
(the "Council") at a regular or special meeting of the Council held
on January 13, 1992. Said meeting was duly called, regularly held,
open to the public, and held at the place at which meetings of the
Council are regularly held. Councilmember Kuether
moved the adoption of the Resolution, which motion was seconded by
Councilmember Elliott . A vote being taken on the
motion, the following members of the Council voted in favor of the
motion to adopt the Resolution: Neal, Kuether, Reinert, Elliott.
and the following voted against the same: none.
Whereupon said Resolution was declared duly passed and adopted.
The Resolution is in full force and effect and no action has been
taken by the Council which would in any way alter or amend the
Resolution.
WITNESS MY HAND officially as the City Administrator of the
City of Lino Lakes, Minnesota, this 13ty of January, 1992.,.,
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City Administrator
City of Lino Lakes, Minnesota