HomeMy WebLinkAbout19-018 Reimbursement for 2019A Bonds
RESOLUTION NO. 19-018
RESOLUTION ESTABLISHING PROCEDURES RELATING TO COMPLIANCE WITH
REIMBURSEMENT BOND REGULATIONS UNDER THE INTERNAL REVENUE CODE IN
CONNECTION WITH THE GENERAL OBLIGATION BONDS, SERIES 2019A
BE IT RESOLVED by the City Council (the "Council") of the City of Prior Lake,
Minnesota (the "City"), as follows:
1. Recitals.
(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
bond" proceeds, being proceeds of bonds used to reimburse the City for any project expenditure
paid by the City prior to the time of the issuance of those bonds, specifically in this ca se, the
General Obligation Bonds, Series 2019A (the "Bonds").
(b) The Regulations generally require that the City (as the issuer of or the primary
obligor under the Bonds) make a declaration of intent to reimburse itself for such prior
expenditures out of the proceeds of the 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 the 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 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 situations in which they apply,
require the City to have declared an official intent (the "Declaration") to reimburse itself for
previously paid project expenditures out of the proceeds of the Bonds. This Declaration relates to
the following projects (collectively, the "Project") and the costs thereof to be financed:
Equipment Acquisition $ 254,000
Street Reconstruction 1,475,000
Permanent Improvement Revolving projects 500,000
Project Total $ 2,229,000
3. The City reasonably expects to reimburse itself for the payment of certain costs of
the Project out of the proceeds of the Bonds to be issued after the date of payment of such costs.
As of the date hereof, the City reasonably expects that $2,229,000 is the maximum principal
amount of the Bonds which will be issued to finance the Project.
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.
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5. As of the date hereof, the statements and expectations contained in this Declaration
are believed to be reasonable and accurate.
Adopted on February 04, 2019, by the City Council of the City of Prior Lake, Minnesota.
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CERTIFICATION
The undersigned, being the duly qualified and acting Clerk of the City of Prior Lake,
Minnesota, hereby certifies the following:
The foregoing is true and correct copy of a Resolution on file and of official, publicly
available record in the offices of the City, which Resolution relates to procedures of the City for
compliance with certain IRS Regulations on reimbursement bonds. Said Resolution was duly
adopted by the governing body of the City (the "Council") at a regular meeting of the Council
held on February 04, 2019. The Council meeting was duly called, regularly held, open to the
public, and held at the place at which meetings of the Council are regularly held.
Councilmember Braid moved the adoption of the Resolution, which motion was seconded by
Councilmember Erickson. A vote being taken on the motion, the following members of the
Council voted in favor of the motion to adopt the Resolution:
and the following voted against the same:
Whereupon said Resolution was declared duly passed and adopted. The Resolution is in
full force and effect and no action has been taken by the Council which would in any way alter
or amend the Resolution.
WITNESS MY HAND officially as the Clerk of the City of Prior Lake, Minnesota, on
February 04, 2019.
____________________________________
City Manager
City of Prior Lake, Minnesota