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The Bonds are proposed to be issued as tax-exempt obligations, the interest on which is not <br />includable in gross income for federal income tax purposes. If the Bonds are authorized to be issued <br />by the City Council, the Bonds will be issued as conduit revenue Bonds secured solely by the <br />revenues derived from the Loan Agreement executed by the Borrower and from other security <br />provided by the Borrower. The Bonds will not constitute a general or moral obligation of the City <br />and will not be secured by or payable Ii any property or assets of the City (other than the interests <br />of the City in the Loan Agreement) and will not be secured by any taxing power of the City. The <br />Bonds will not be subject to any debt limitation imposed on the City and the issuance of the Bonds <br />will not have any adverse impact on the credit rating of the City, even in the event that the Borrower <br />encounters financial difficulties with respect to the facilities to be financed with the proceeds of the <br />Bonds. <br />Pursuant to the American Recovery and Reinvestment Tax Act of 2009, each 501(c)(3) <br />organization has the ability to designate up to $30,000,000 in tax-exempt obligations as "bank <br />qualified" in the calendar year 2010. During 2010, each municipality has the same ability to <br />designate up to $30,000,000 in tax-exempt obligations as "bank qualified." Thus, the issuance of the <br />Bonds will not adversely affect the ability of the City to issue bank-qualified obligations in calendar <br />year 2010. <br />Please contact me if you have any questions regarding the Bonds or this financing. <br />GRAVEN, CHARTERED <br />