Resolution No. 2022-48 Expenditures from Bond Proceeds (2)
Resolution No. 2022-48
Indicating Official Intent to Reimburse Original Expenditures from Bond Proceeds
Whereas, pursuant to Resolution No. 2022-46, the Fridley City Council (Issuer) has determined it
is necessary and expedient to issue General Obligation Tax Abatement Bonds, Series 2022A
(Bonds) to finance the improvements to the park system as identified in the Park System
Improvement Plan (Plan) in the City of Fridley (City); and
Whereas, the Internal Revenue Service has issued Section 1.150-2 of the Income Tax Regulations
(Regulations) dealing with the issuance of obligations all or a portion of the proceeds of which
are to be used to reimburse the payor for project expenditures made by such payor prior to the
date of issuance; and
Whereas, the Regulations generally require that the Issuer make a prior declaration of its official
intent to reimburse itself for such prior expenditures out of the proceeds of a subsequently issued
borrowing no later than 60 days after payment of such expenditure, that the borrowing occur and
the reimbursement allocation be made from the proceeds of such borrowing within eighteen
months of the payment of the expenditure or, if longer, within eighteen months of the date the
project is placed in service, but in no event more than three years after the date the original
expenditure was paid and that the expenditure must either be a capital expenditure, or a cost of
issuance of the obligation; and
Whereas, the Issuer desires to comply with requirements of the Regulations with respect to the
Plan in order to preserve the option of the Issuer to reimburse costs of the Project with tax-exempt
obligations to finance the capital costs of the City’s Park System Improvement Plan; and
Whereas, the total cost of the Project is approximately $20,000,000, exclusive of financing costs
and capitalized interest, and the Issuer intends to finance all or a portion of the costs of the Project
from proceeds of a borrowing; and
Whereas, the maximum amount of debt to be issued for the Project is $20,730,000, plus costs of
issuance and capitalized interest; and
Whereas, as of the date hereof, there are no Issuer funds reserved, allocated on a long-term basis
or otherwise set aside (or reasonably expected to be reserved, allocated on a long-term basis or
otherwise set aside) to provide permanent financing for the expenditures related to the Project;
and
Whereas, this resolution, therefore, is determined to be consistent with the Issuer’s budgetary
and financial circumstances as they exist or are reasonably foreseeable on the date hereof, all
within the meaning and content of the Regulations.
Therefore, be it resolved, the City Council of the City of Fridley declares the City of Fridley’s
intent to reimburse original expenditures from proceeds from the sale of the General Obligation
Tax Abatement Bond, Series 2022A.
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Passed and adopted by the City Council of the City of Fridley this 9 day of May, 2022.
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Scott J. Lund – Mayor
Attest:
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Melissa Moore – City Clerk