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City of St. Anthony, Minnesota <br /> February 5, 1997 <br /> • 10. Rebate Requirements The bonds are subject to the federal <br /> arbitrage requirements. However, since the <br /> City is expected to issue less than $5.million <br /> of tax-exempt debt in 1997, it will qualify as <br /> a "small issuer" and be exempt from <br /> rebating arbitrage earnings to the federal <br /> government. <br /> 11. Bona Fide'Debt Service Fund The City must maintain a bona fide debt <br /> service fund or be subject to yield restriction. <br /> A bona fide debt service fund is a fund for <br /> which there is an equal matching of revenue <br /> to debt service expense, with a carry-over <br /> permitted equal tot he greater of the <br /> investment earnings in the fund during that <br /> year or 1 1/2 of the debt service of that year. <br /> 12. Economic Life The average life of the bonds cannot exceed <br /> 120% of the economic life of the projects to <br /> be financed. The economic life of <br /> infrastructure improvements are 20 to.50 <br /> years. The average life of the bonds is <br /> 10.07 years. The bonds are therefore within <br /> the economic life requirements. <br /> 13. Federal Reimbursement Regulations Federal reimbursement regulations require <br /> the City to make a declaration, within 60 <br /> days of the actual payment, of its intent to <br /> reimburse itself from expenses paid prior to <br /> the receipt of bond proceeds. It is our <br /> understanding the City has taken whatever <br /> actions are necessary to comply with the <br /> federal reimbursement regulations. <br /> 14. Continuing Disclosure This issue is subject to the SEC's new <br /> continuing disclosure requirements. <br /> However, since this issue is less than <br /> $1,000,000, the City will be exempt from the <br /> disclosure requirements. <br /> 15. Attachments a) Assessment Income Schedule <br /> b) Debt Service Schedule <br /> c) Terms of Proposal <br /> DISCUSSION <br /> Proceeds of this issue will be used to finance various improvement projects in the City. The <br /> bonds will be payable from special assessments against benefited property in the principal <br /> • amount of$177,523 and annual tax levies averaging approximately $53,000. <br /> The projection of assessment income is shown on page 4 of these recommendations. The City <br /> expects to file special assessments, totaling $177,523 of principal, by approximately August 1, <br /> Page 2 <br />