09-48 - 10-06 - financing 2010 road con - compliance bond regulations IRS
Resolution 09-48
October 6, 2009
Member Pentel introduced the following agenda and moved its adoption:
RESOLUTION RELATING TO THE FINANCING OF THE CITY'S 2010
ROAD CONSTRUCTION PROGRAM; ESTABLISHING COMPLIANCE WITH
REIMBURSEMENT BOND REGULATIONS UNDER THE INTERNAL REVENUE CODE
BE IT RESOLVED by the City Council of the City of Golden Valley, Minnesota (the
"City"), as follows:
1. Recitals.
(a) The Internal Revenue Service has issued Section 1.150-2 of the
Income Tax Regulations (the "Regulations") dealing with the issuance of bonds all or a
portion of the proceeds of which are to be used to reimburse the City for project
expenditures made by the City prior to the date of issuance.
(b) The Regulations generally require that the City make a declaration of
its official intent to reimburse itself for such prior expenditures out of the proceeds of a
subsequently issued series of bonds within 60 days after payment of the expenditures, that
the bonds be issued and the reimbursement allocation be made from the proceeds of such
bonds within the reimbursement period (as defined in the Regulations), and that the
expenditures reimbursed be capital expenditures or costs of issuance of the bonds.
(c) The City desires to comply with requirements of the Regulations with
respect to the projects hereinafter identified.
2. Official Intent Declaration.
(a) The City proposes to undertake a major road construction program in
2010, consisting of the construction and improvement of the City streets identified on
Exhibit A hereto (collectively, the "Project"), and to make original expenditures with respect
thereto prior to the issuance of reimbursement bonds, and reasonably expects to issue
reimbursement bonds for the Project, in one or more series, in an amount not to exceed
$5,544,000.
(b) Other than (i) de minimis amounts permitted to be reimbursed pursuant to
Section 1.150-2(f)(1) of the Regulations or (ii) expenditures constituting preliminary
expenditures as defined in Section 1.150-2(f)(2) of the Regulations, the City will not seek
reimbursement for any original expenditures with respect to the foregoing Project paid more
than 60 days prior to the date of adoption of this resolution. All original expenditures for
which reimbursement is sought will be capital expenditures or costs of issuance of the
reimbursement bonds.
Resolution 09-48 - Continued
October 6,2009
3. Budqetary Matters. As of the date hereof, there are no City funds reserved,
pledged, allocated on a long term basis or otherwise set aside (or reasonably expected to
be reserved, pledged, allocated on a long term basis or otherwise set aside) to provide
permanent financing for the original expenditures related to the Project, other than pursuant
to the issuance of the reimbursement bonds. Consequently, it is not expected that the
issuance of the reimbursement bonds will result in the creation of any replacement
proceeds.
4. Reimbursement Allocations. The City's Finance Director shall be responsible for
making the "reimbursement allocations" described in the Regulations, being generally the
transfer of the appropriate amount of proceeds of the reimbursement bonds to reimburse
the source of temporary financing used by the City to make payment of the original
expenditures relating to the Project. Each reimbursement allocation shall be made within 30
days of the date of issuance of the reimbursement bonds, shall be evidenced by an entry
on the official books and records of the City maintained for the reimbursement bonds and
shall specifically identify the original expenditures being reimbursed.
rXt/nda)f(X~
Linda R Loomis, Mayor
ATTEST:
The motion for the adoption of the foregoing resolution was seconded by Member Shaffer
and upon a vote being taken thereon, the following voted in favor thereof: Freiberg, Loomis,
Pentel, Scanlon and Shaffer; and the following voted against the same: none, whereupon
said resolution was declared duly passed and adopted, signed by the Mayor and her
signature attested by the City Clerk.
Resolution 09-48 - Continued
October 6,2009
EXHIBIT A
2010 STREETS:
. Cutacross Road: Meander Road to Ski Hill Road
. Edgewood Avenue North: Glenwood Avenue to Westchester Circle
. Georgia Avenue North: Glenwood Avenue to Westchester Circle
. Harold Avenue: Idaho Avenue North to cul-de-sac
. Idaho Avenue North: cul-de-sac to Olson Memorial Frontage Road (south)
. Kingston Circle: Idaho Avenue North to cul-de-sac
. Meander Road: Glenwood Avenue to Cutacross Road (west)
. Olson Memorial Frontage Road (south): Douglas Drive to Glenwood Avenue
. Olson Memorial Frontage Road (south): cul-de-sac to 375 feet east of Schaper Drive
. Paisley Lane: Glenwood Avenue to Cutacross Road
. Pomander Walk: Paisley Lane to cul-de-sac
. Ski Hill Road: Paisley Lane to cul-de-sac
. Westchester Circle: Olson Memorial Frontage Road (east) to Olson Memorial
Frontage Road (west)
. Windy Draw: Ski Hill Road to cul-de-sac