HomeMy WebLinkAboutResolution - 98-159 - Financing of Projects to be Undertaken by the City and HRA: Establishing Compliance with Reimbursement Bond Regulations under the IRS Code - 09/01/1998 CITY OF EDEN PRAIRIE
HENNEPIN COUNTY,NIINNESOTA
RESOLUTION NO. 98-159
RESOLUTION RELATING TO FINANCING OF CERTAIN PROPOSED
PROJECTS TO BE UNDERTAKEN BY THE CITY AND THE HOUSING
AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF EDEN
PRAIRIE,; ESTABLISHING COMPLIANCE WITH REIMBURSEMENT
BOND REGULATIONS UNDER THE INTERNAL REVENUE CODE
BE IT RESOLVED by the City Council of the City of Eden Prairie,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 or the
Housing and Redevelopment Authority in and for the City of Eden Prairie (the "Authority") on
behalf of 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
certain projects hereinafter identified. ,
2. Official Intent Declaration.
(a) The City and the Authority propose to undertake the following project or projects and
to make original expenditures with respect thereto prior to the issuance of reimbursement bonds,and
reasonably expect that the City or the Authority will issue reimbursement bonds for such project or
projects in the maximum principal amounts shown below:
Project Maximum Amount of Bonds
Expected to be issued for Project
Construction of a fire station and parking structure $3,500,000
to be leased to the City
(b) Other than(1) de minimis amounts permitted to be reimbursed pursuant to Section
1.1 50-2(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 projects 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.
3. Budge , 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 projects,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 financial officer 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 or the Authority to make payment of the original expenditures
relating to the projects. 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.
Passed by the City Council this lst day of September, 1998.
r. Jean Harris,Mayor
Attest
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Donald R. Uram, City Finance Director/Clerk