Res. #07-045 - Accepting Proposal Sale of $2,600,000 G.O. Imp. Bonds

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Code of 1986, as amended (the Code), and the Treasury Regulations promulgated thereunder (the "Regulations"), in effect at the time of such actions, and that it will take or cause its officers, employees or agents to take, all affirmative action within its power that may be necessary to ensure that such interest will not become subject to taxation under the Code and applicable Regulations, as presently existing or as hereafter amended and made applicable to the Bonds. 16.02. The City will comply with requirements necessary under the Code to establish and maintain the exclusion from gross income of the interest on the Bonds under Section 103 of the Code, including, without limitation, requirements relating to temporary periods for investments, limitations on amounts invested at a yield greater than the yield on the Bonds, and the rebate of excess investment earnings to the United States. 16.03. The City further covenants not to use the proceeds of the Bonds or to cause or permit them or any of them to be used, in such a manner as to cause the Bonds to be "private activity bonds" within the meaning of Section 103 and 141 through 150 of the Code. 16.04. In order to qualify the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b )(3) of the Code, the City makes the following factual statements and representations: (a) the Bonds are not "private activity bonds" as defined in Section 141 of the Code; (b) the City hereby designates the Bonds as "qualified tax-exempt obligations" for purposes of Section 265(b )(3) of the Code; (c) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds, treating qualified 501(c)(3) bonds as not being private activity bonds) which will be issued by the City (and all subordinate entities of the City) during calendar year 2007 will not exceed $10,000,000; and (d) not more than $10,000,000 of obligations issued by the City during calendar year 2007 have been designated for purposes of Section 265(b )(3) of the Code. 16.06. The City certifies that the proceeds of the Bonds will not be used by the City to reimburse itself for any expenditure with respect to the Project which the City paid or will have paid more than 60 days prior to the issuance of the Bonds unless, with respect to such prior expenditures, the City shall have made a declaration of official intent which complies with the provisions of Section 1.150-2 of the Regulations, except with respect to certain de minimis expenditures meeting the requirements of Section 1.150-2(f)(l) and preliminary expenditures meeting the requirements of Section 1.150-2(f)(2) which in the aggregate do not exceed 20% of the "issue price" of the Bonds. 16.07. The City will use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designations made by this section. 20