Loading...
HomeMy WebLinkAboutR-2009-13 reimburse certain expenditures for drainage projects with proceeds from issuance of bonds D REQUEST FOR CITY COUNCIL AGENDA ITEM Agenda Date Requested: November 9, 2009 Appropriation Requested By: Michael G. Dolbv, Director of Finance Source of Funds: N/A Department: FINANCE Account Number: N/A Report: Resolution: XX Ordinance: Amount Budgeted: Exhibits: Resolution - Amount Requested: N/A Exhibits: Budgeted Item: Exhibits: SUMMARY & RECOMMENDATION During budget workshops, staff discussed with council the opportunity to pursue debt issuances for drainage, community/ convention center, public works improvements and parks improvements. We anticipate issuing debt in the spring of2010. However, because we are moving forward with planning , engineering and other design projects, we recommend the City Council approve a resolution that allows the City to reimburse itself from future bond proceeds for expenditures that are made prior to the issuance of the debt. This is a position that we have taken on several other projects in the past as recommended by bond counsel and required by federal law. The attached resolutions give us the option to reimburse ourselves from future bond proceeds for certain costs associated with the above-mentioned projects. /1 /1 ;:'1 Date 200Q-13 RESOLUTION NO. RESOLUTION DECLARING INTENTION TO REIMBURSE CERTAIN EXPENDITURES WITH BORROWING PROCEEDS WHEREAS, the City of La Porte, Texas (the "Issuer") desires to pay expenditures in connection with the design, planning, acquisition, construction, equipping, and/or renovating the project or facilities described as drainage , community/convention center, public works improvements, and parks improvements (the "Projects"). WHEREAS, Article 7I7k-6, Vernon's Texas Civil Statutes, as amended ("Article 717k-6"), permits the Issuer to use the proceeds of obligations to reimburse the Issuer for costs attributable to the Project paid or incurred before the date of issuance of such obligations; and WHEREAS, the Issuer finds, considers, and declares. that the reimbursement of the Issuer for the payment of such expenditures will be appropriate and consistent with the objectives of the Issuer's programs and, as such, chooses to declare its intention, in accordance with the provisions of Section 1.150-2 of the Treasury Regulations, to reimburse itself for such payments at such time as it issues obligations to finance the Project. NOW, THERFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LA PORTE, TEXAS THAT: Section 1. This Resolution declares the intent of the Issuer to reimburse the expenditures for the Project with the proceed of obligations. The Issuer presently intends to reimburse the expenditure by incurring obligations issued under Texas law, the interest on which is excludable from gross income under Section 103 of the Internal Revenue Code of 1986, as amended. Section 2. The Issuer reasonably expects to incur debt, in one or more series of obligations, in an aggregate maximum principal amount now expected to be equal to $9,610,000 for the purpose of paying the costs of the Project. Section 3. The Issuer intends to reimburse the expenditures hereunder not later than 18 months after the date of the original expenditure is paid or the date the Project is placed in service or abandoned, but in no event more than three years after the original expenditure is paid unless the Project is a construction project for which the Issuer and a licensed architect or engineer have certified that at least five years are necessary to complete the Project in which event the maximum reimbursement period is five years after the date of the original expenditure. Section 4. The Issuer intends that this Resolution satisfy the official intent requirement set forth in Section 1.150-2 of the Treasury Regulations and evidences its intentions under Article 717k-6. Section 5. This resolution shall be liberally construed to evidence the intent of the Issuer to comply with state law and federal income tax law in the issuance of tax-exempt obligations for the Project. PASSED AND APPROVED this the 9th day of November 2009. CIT~O.F A.... PORTE, TEXAS ;r~ r-:z::.' .~. ATTEST APPROVED: "~T~ Cit Atto ey L;aL~A)Afl!