7C, Conduit Debt Policies - Laserfiche WebLink

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3. Arbitrage Yield Restrictions and Rebate Recordkeeping a. Investment and Arbitrage Documentation to be Assembled and Retained i. An accounting of all deposits, expenditures, interest income and asset balances associated with each fund established in connection with each tax-exempt debt obligations. This includes an accounting of all monies deposited to the Debt Service Account to make debt service payments on the tax-exempt debt obligations, regardless of the source derived. Accounting for expenditure and assets is described in further detail in Section 3b. ii. Statements prepared by Trustee or Investment Provider. iii. Documentation of at least quarterly allocations of investments and investment earnings to each tax-exempt debt obligation (i.e. uncommingling analysis). iv. Documentation for investments made with tax-exempt proceeds such as: 1. Investment contracts (i.e. guaranteed investment contracts). 2. Credit enhancement transactions (i.e. bong issuance contracts). 3. Financial derivatives (swaps, caps, etc). 4. Bidding of financial products. a. Investments acquired with tax-exempt proceeds are purchased at fair market value (i.e. three bids for open market securities needed in advance refunding escrows). b. Computations of the arbitrage yield. c. Computations of yield restriction and rebate amounts including but not limited to: i. Compliance in meeting the "Temporary Period from Yield Restriction Exception" and limiting the investment of funds after the temporary period expires. ii. Compliance in meeting the "Rebate Exception". 1.Qualifying for the "Small Issuer Exception". 2.Qualifying for a "Spending Exception". • 6 Month Spending Exception • 18 Month Spending Exception • 24 Month Spending Exception 3.Qualifying for the "Bona Fide Debt Service Fund Exception". 4. Quantifying arbitrage on all funds established in connection with the tax-exempt debt obligations in lieu of satisfying arbitrage exceptions (including Reserve Funds and Debt Service Funds). d. Computations of yield restriction and rebate payments. e. Timely Tax Form 803 8-T filing, if applicable. i. Remit any arbitrage liability associated with this tax-exempt debt obligation to the IRS at each five year anniversary date of the obligation, and the date in which the obligation is not longer outstanding (redemption or maturity date), whichever comes sooner, within 60 days of said date. f. Timely Tax Form 8038-R filing, if applicable. g. Procedures or guidelines for monitoring instances where compliance with applicable yield restriction requirements depends on subsequent reinvestment of tax-exempt proceeds in lower yielding investments (i.e. reinvestment in zero coupon SLGS). 4. Expenditure and Asset Documentation to be Assembled and Retained a. Documentation of allocations of tax-exempt proceeds to expenditures (i.e. allocation of proceeds to expenditures for the construction, renovation or purchase of facilities owned and used in the performance of exempt purposes). b. Documentation of allocations of tax-exempt proceeds to issuance costs. c. Copies of requisitions, draw schedules, draw requests, invoices, bills and cancelled checks related to tax-exempt proceed expenditures during the construction period.