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applicable Treasury Regulations (the "Regulations "), and agrees to take any and all actions <br />within its powers to ensure that the interest on the Bonds will not become includable in gross <br />income of the recipient under the Code and the Regulations. All proceeds of the Bonds <br />deposited in the Project Fund will be expended solely for the payment of the costs of the Project. <br />The Project is and will be owned and maintained by the City and available for use by members <br />of the general public on a substantially equal basis. The City shall not enter into any lease, <br />management contract, use agreement, capacity agreement or other agreement with any non- <br />governmental person relating to the use of the Project, or any portion thereof, or security for the <br />payment of the Bonds which might cause the Bonds to be considered "private activity bonds" or <br />"private loan bonds" pursuant to Section 141 of the Code. <br />8.02. Arbitrage Certification. The Mayor and City Manager being the officers of the <br />City charged with the responsibility for issuing the Bonds pursuant to this Resolution, are <br />authorized and directed to execute and deliver to the Purchaser a certificate in accordance with <br />Section 148 of the Code, and applicable Regulations, stating the facts, estimates and <br />circumstances in existence on the date of issue and delivery of the Bonds which make it <br />reasonable to expect that the proceeds of the Bonds will not be used in a manner that would <br />cause the Bonds to be "arbitrage bonds" within the meaning of the Code and Regulations. <br />8.03. Arbitrage Rebate. The City acknowledges that the Bonds are subject to the rebate <br />requirements of Section 148(f) of the Code. The City covenants and agrees to retain such <br />records, make such determinations, file such reports and documents and pay such amounts at <br />such times as are required under said Section 148(f) and applicable Regulations unless the Bonds <br />qualify for an exception from the rebate requirement pursuant to one of the spending exceptions <br />set forth in Section 1.148 -7 of the Regulations and no "gross proceeds" of the Bonds (other than <br />amounts constituting a "bona fide debt service fund ") arise during or after the expenditure of the <br />original proceeds thereof. <br />8.04. Qualified Tax- Exempt Obligations. The City Council hereby designates the Bonds <br />as "qualified tax- exempt obligations" for purposes of Section 265(b)(3) of the Code relating to <br />the disallowance of interest expense for financial institutions, and hereby finds that the <br />reasonably anticipated amount of tax- exempt obligations (within the meaning of Section <br />265(b)(3) of the Code) which will be issued by the City and all subordinate entities during <br />calendar year 2017 does not exceed $10,000,000. <br />8.05. Reimbursement. The City certifies that the proceeds of the Bonds will not be used <br />by the City to reimburse itself for any expenditure with respect to the Project which the City paid <br />or will have paid more than 60 days prior to the issuance of the Bonds unless, with respect to <br />such prior expenditures, the City shall have made a declaration of official intent which complies <br />with the provisions of Section 1.150 -2 of the Regulations, provided that this certification shall <br />not apply (i) with respect to certain de minimis expenditures, if any, with respect to the Project <br />meeting the requirements of Section 1.150- 2(f)(1) of the Regulations, or (ii) with respect to <br />"preliminary expenditures" for the Project as defined in Section 1.150- 2(f)(2) of the Regulations, <br />including engineering or architectural expenses and similar preparatory expenses, which in the <br />aggregate do not exceed 20% of the "issue price" of the Bonds. <br />11 <br />