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91-7791R46 CITY~OF RICHFIELD ,MINNESOTA RESOLUTION NO. 7791 DECLARING THE OFFICIAL INTENT OF THE CITY OF' RICHFIELD TO REIMBURSE CERTAIN EXPENDITURES FROM THE PROCEEDS OF TAXABLE OR TAX-EXEMPT BONDS TO BE ISSUED BY THE CITY BE IT RESOLVED by the City Council of the City of Richfield Minnesota (the "City") ss follows: Section 1. Recitals. 1.01 The Internal Revenue Service has issued proposed new Tres. Reg. § 1.103-1? (the "Reimbursement Rules") providing that proceeds of tax-exempt bonds used to reimburse prior expenditures will not be deemed spent unless certain requirements are met. 1.02 The City has incurred certain expenditures since September ,8, 1989 and expects to incur certain additional expenditures, all of which may be financed temporarily from sources other than taxable or tax-exempt bonds, and reimbursed from the proceeds of a taxable or tax-exempt bond. 1.03 The new reimbursement rules will apply to bonds issued after September 7, 1991. 1.04 The Reimbursement Rules require that the allocation of proceeds of the bonds to be issued to reimburse any expenditures will be made not later than the later of one year after the expenditure was paid or one year after the property was placed in service. 1.05 The expenditures to be reimbursed must have a reasonably expected economic life of at least .one year, in that they are, or are to be incorporated in or become a part of, a facility, are properly changeable to or may be capitalized as part of the basis of the facility, and if the City were subject to federal income taxation, would be depreciable over the facility's economic life. 1.06 Expenditures made between September 8, 1989 and September ?, 1991, may be reimbursed as described in Section 1.02 herein only if there is objective evidence that, at the time the expenditures were paid, the City reasonably expected to reimburse such expenditures with proceeds of a taxable or tax exempt borrowing. 1.07 If any future expenditure to be reimbursed is not made within two years of the date of this Resolution, this Resolution may be updated to the extent such expenditure is still expected to be reimbursed with bond proceeds at a later date. 1.08 Proceeds of the bonds issued to reimburse the expenditure's described in Exhibit A will be deemed spent only when (1) an allocation entry is made on the books or records of the City with res,~pect to the bonds; (2) the entry specifically identifies an actual expenditure to be reimbursed; and (3) the allocation is effective to relieve the bond proceeds from restrictions on unspent proceeds under applicable documents and state laws. 1.09 None of the proceeds of expenditures will be used (i) to refun~ (ii) to create or increase the balance such purpose, or (iii) to create or incr~ fund or replace funds used for such p originally paid with the proceeds of a. such amounts are deposited in a bona i exempt issue was not reasonably expec the bonds issued to reimburse the City for another tax-exempt governmental issue or in a sinking fund or replace funds used for ase the balance in a reserve or replacement irposes, or (iv) to reimburse an expenditure other tax-exempt bond obligation; unless (i) de debt service fund, or (ii) the original tax- ed to be used to finance the expenditure. Section 2. Intent Declared. 2.01 The City reasonably exp~ets to expend moneys after the date hereof from the sources described in Exhibit A on a temporary basis to pay the expenditures described in Exhibit A. The City reasonably expects to reimburse itself for such expenditures from the proceeds of taxable or tax-exempt bonds, the debt service for which is expected to be paid from the sources described in Exhibit A. 2.02 The City also expended (certain moneys between September 8, 1989 and the date hereof from the sources described in Exhibit A. At the time of those expenditures, the City reasonably exp~eted to reimburse the expenditures from the proceeds of taxable or tax exempt bo ids, the debt service for which is expected to be paid from the sources described in Exhibit A. Objective evidence of the City's reasonable expectations regarding sucl} reimbursement is summarized in Exhibit B. 2.03 The City Administrator is authorized to designate appropriate additions to Exhibit A in circumstances where time is of the essence, and any such designation shall be reported to the City Council at the earliest practicable date and shall be filed with the official boo~CS and records of the City at the times and in the manner provided in Section 2.04. 2.04 This resolution shall be maintained as part of the books and records of the City at City Hall, and shall be continuously available during normal business hours of the City on every business day of the period beginning not more than 10 days after adoption of this resolution and ending on the last date of issue of any bonds issued to reimburse expenditures described in Exhibit A. 2.05. This Resolution is an ex City based on the facts and circumst; Tlie anticipated reimbursements set City's .budgetary and financial cir~ described at Exhibit A are expected term 'basis pursuant to the City's bu budget, or restriction of moneys or a~ a fund, the primary purpose of which available to pay. an expenditure the borrowing. session of the reasonable expectations of the ces known to the City as of the date hereof. 'orth at Exhibit A are consistent with the .instances. . No sources other than those be allocated to such expenditures on a long ;et. The City has not made any allocation, opted any requirement or policy to reimburse to prevent moneys from being deemed to be ity intends to reimburse with proceeds of a 2 2.06 This Resolution is intended to constitute official intent for purposes of proposed Tres. Reg. ~ 1.1Q3-17 and any successor law,. regulation or ruling. This resolution shall be modified to the extent required or permitted by Tres. Reg. ~ 1.103-17 as finally adopted, or any successor law, regulation or ruling. Approved by the City .Council of the City of Richfield this 9th day of September , 1991. ,, Attest: ~~~~" ~~ ~'1 Martin J. 'K' sch Mayor ~~'~ l ~~~o Thomas P. Ferber City Clerk 3 ERHIBIT A TO OFFICL~L INTENT RESOLUTION ADOPTED ,_ 1991 Expected Description of Estimated Size, Temporary Property or Quantity Financing Protect or Cost Source Expected Source to pay Bond Debt Service 4