RES 1992-43 - 00003443111
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ED IT RESOLVED by the City Council (the ^Council") of the City of Fridley,
Minnesota (the "City "), as follows:
1. Recitals.
(a) The Internal Revenue service has issued final Treasury Regulations
Section 1.103 -18 (the "Regulations ") dealing with reimbursement bond
proceeds, which would include those proceeds of the City's bonds to be
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 prior
declaration of its official intent to reimburse itself for such prior
expenditures out of the proceeds of subsequent borrowings, that such
declaration generally be made on or before the date the expenditure is
actually paid, that the bonding occur and the reimbursement allocation be
made from the proceeds of such bonds within one year of the payment of the
expenditure (or not later than one year after the project is placed in
service, if that is a longer period) , and that the expenditure be a
capital expenditure.
' (c) The City desires to omply with the Regulations and to establish
certain procedures relating thereto.
(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 Declaration. The Regulations, in the situation in which
they apply, require the City to have made an official declaration of its
reasonable intention (hereinafter referred to as the "Official Intent
Declaration" or the "Declaration ") to reimburse itself for previously paid
project expenditures out of the proceeds of subsequent bonds or other
borrowings. The Council hereby authorizes the City of Fridley to make the
City's Official Intent Declarations or to delegate from time to time that
responsibility to other appropriate City employees. Each Declaration shall
ootply with the requirements of the Regulations, including without limitation
the following:
(a) Each Declaration shall be made on or before the date the City pays
the applicable project costs and shall state that the City reasonably
intends and expects to reimburse itself for the expenditure with proceeds
of a borrowing. Each Declaration may be made substantially in the form
' of the "Declaration of Official Intent" which is attached to and made a
part of this Resolution.
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Page 2 - Resolution No. 43 - 1992
' (b) Each Declaration shall specifically contain the following statement:
"'Ibis Declaration is a declaration of official intent under Treasury
Regulations Section 1.103 -18."
(c) Each Declaration shall and is hereby declared to be made and filed
in the publicly available official books, records, or proceedings of the
City, which shall be reasonably available for public inspection at City
Hall during normal business hours of the City on every business day during
the period beginning on the earlier of 10 days after the making of the
Declaration or the date of issuance of the reimbursement bonds and endirxj
on the day after the issuance of such bonds.
(d) Each Declaration shall, at a minimum, contain a general functional
description of the property, project, or program for which the expenditure
to be reimbursed is paid (for example, 111992 Street Improvement Project"
or other specific, identifiable, project of the City) or, in the
alternative, shall identify the particular fund or account of the City
from which the expenditure to be reimbursed is paid, including a
description of the general functional purpose of that fund or account (for
example, "park and recreation fund - recreational facility capital
improvement program ").
(e) Each Declaration shall also contain a statement of the maximum
principal amount of debt expected to be issued for the subject project.
' (f) 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 that it will ultimately issue
reimbursement bonds to provide long -term financing for 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 in
general and their application in particular circumstances. It is the
Council's intention that Declarations not be made (i) when available funds
of the City have been or are reasonably expected to be dedicated or
otherwise reserved to fund on a long -tern basis the particular
expenditures involved or (ii) when it is not reasonably expected that
reimbursement bonding will occur.
(g) The Council 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 Official Intent Declarations,
including recd mendations on the timing of the issuance of such bonds so
that the "reimbursement allocation" described in the Regulations and in
paragraph 3 below can be made within the 1 year time limits prescribed in
the Regulations.
(h) This Resolution shall supplement and amend all prior determinations
and policies adopted by the City in regard to complying with the
Regulations, as initially proposed, and in the event of any inconsistency
' between the terms provided in this Resolution and said prior
determinations or policies, the provisions of this Resolution shall
govern.
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Page 3 — Resolution No. 43 - 1992
' 3. Refit Allocations. The designated City officials shall also be
responsible for making the "reimbursement allocations" described in the
Regulations, being generally the transfer of the appropriate amount of
reimbursement bond proceeds to reimburse the source of temporary financing used
by the City to make payment of the prior expenditure. Each allocation shall be
evidenced by an entry on the official books or records of the City maintained
for such reimbursement bonds; shall specifically identify the actual prior
expenditure being reimbursed or, in the case of the refit of a
particular fund or account, the fund or account from which the expenditure was
paid; and shall be effective to relieve the bond proceeds involved from any
restriction under the bond resolution or other relevant legal docLumnts for
those bonds and under any applicable state statute applicable to unspent
proceeds of such bond issue.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 18TH DAY OF
MAY, 1992.
Vv�
WILLIAM J. - MAYOR
ATTEST:
SHIRLEY A. AIAAPALA -�CPPY cERKK
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