HomeMy WebLinkAboutResolution 4923 ,
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RESOLUTION OF THE CITY COUNCIL
��kESI3�g'� � NO. � � � Q'
A RESOLUTION ESTABLISHING PROCEDURES
RELATING TO COMPLIANCE WITH REIMBURSEMENT BOND
REGULATIONS UNDER THE INTERNAL REVENUE CODE
BE IT RESOLVED by the City Council in and for the City of Orono, Minnesota (the "City"), as
follows:
1. Recitais.
(a) The Internal Revenue Service has issued Treasury Regulations,Section 1.150-
2 (as the same may be amended or supplemented, the "Regulations"), dealing with
"reimbursement liond"proceeds,being proceeds of the City's bonds 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 declaration of intent �
, to reimburse itself for such prior expenditures out of the proceeds of subsequently issued
bonds,that such declaration be made not later than 60 days after the expenditure is actually
paid,and that the bonding occur and the written reimbursement allocation be made from the
proceeds of such bonds within 18 months after the later of(1) the date of payment of the
expenditure or(2)the date the project is placed in service(but in no event more than 3 years
� after actual payment).
(c) The City heretofore implemented procedures for compliance with the
predecessor versions of the Regulations and desires to amend and supplement those
procedures to ensure compliance with the Regulations. �
(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 lleclaration. The Regulations, in the situations in which they apply,
require the City to have declared an official intent (the "Declaration") to reimburse itself for
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�,� G'�' RESOLUTION OF THE CITY COUNCIL
��kES�I�4� NO. �4 � � �
previously paid project expenditures out of the proceeds of subsequently issued bonds. The City
Council hereby authorizes the City Administrator of the City to make the City's 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 not later than 60 days after payment of the
applicable project cost and shall state that the Cityreasonably expects to reimburse itself for
the expenditure out of the proceeds of a bond issue or similar borrowing. Each Declaration
_ may be made substantially in the form of the Exhibit A which is attached to and mad�a part
of this Resolution, or in any other format which may at the time comply with the
Regulations.
(b) Each Declaration shall (1) contain a reasonably accurate description of the
� "project," as defined�in the Regulations (which may include the property or program to be
financed, as applicable), to which the expenditure relates and (2) state the maximum
principal amount of bonding expected to be issued for that project. �
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(c) Care shall be taken so that the City,or its authorized representatives under this �
Resolution, not make Declarations in cases where the City does not reasonably expect to
issue reimbursement bonds to finance 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 and their application in particular circumstances.
(d) The City 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 Declarations.
� 3. Reimbursement Allocations. The designated City officials shall also be responsible
for making the "reimbursement allocations" described in the Regulations, being generally written � .
allocations that evidence the City's use of the applicable bond proceeds to reimburse the original �
expenditures.
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4. Effect. This Resolution shall amend and supplement all prior resolutions and/or
procedures adopted by the City for compliance with the Regulations(or their predecessor versions),
and,henceforth,in the event of any inconsistency,the provisions of this Resolution shall apply and
. govern. �
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�,�� �G'�' RESOLUTION OF THE CITY COUNCIL
`�kEsKO4" � � � No. 4 � � �
Adopted by the City Council of the City of Orono, Minnesota, at a regular meeting held
January 27, 2003.
ATTEST: � �
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inda S. Vee, City Clerk Barbara A. Peterson, Mayor
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. EXHIBIT A
Declaration of Official Intent
The uridersigned, being the duly appointed and acting City Administrator of the City of .
Orono, Minnesota (the ."City"), pursuant to and for purposes of compliance with Treasury
Regulations, Section 1.150-2 (the "Regulations"), under the Internal Revenue Code of 1986, as
amended, hereby states and certifies on behalf of the City as follows:
1. The undersigned has been and is on the date hereof duly authorized by the City
Council to make and execute this Declaration of Official Intent(the"Declaration")for and on behalf
of the City.
• 2. This Declaration relates to the following proj ect,property or program(the"Proj ect")
and the costs thereof to be financed:
The Navarre Fire Station Project
3. The City reasonably expects to reimburse itself for the payment of certain costs of the
Project out of the proceeds of a bond issue or similar borrowing (the "Bonds") to be issued by the
• � City after the date of payment of such costs: As of the date hereof,the City reasonably expects that
$2,000,000 is the maximum principal amount of the Bonds which will be issued to finance the
Proj ect.
4. Each expenditure to be reimbursed from the Bonds is or will be a capital expenditure
or a cost of issuance,or any of the other types of expenditures described in Section 1.150-2(d)(3)of
• the Regulations.
5. As of the date hereof,the statements and expectations contained in this Declaration
are believed to be reasonable and accurate.
Date: ��l��63
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