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HomeMy WebLinkAbout2007-04 Procedures under the Revenue CodeCITY OF GEM LAKE .RESOLUTION NO.2007-04 16 January 2007 A RESOLUTION ESTABLISHING PROCEDURES RELATING TO COMPLIANCE WITH REIMBURSEMENT BOND .REGULATIONS UNDER THE INTERNAL REVENUE CODE, $E IT REBOLV£D by :the City Council (the "Council") of the City of Gein Lake, Minnesota (the "City"), as follows: 1. RECITALS. A) The..Intemal Revenue. SerAce has issued Treasury :Regulations, Section 133Q-2 (us the same may. *be amended or supplemented, the "Regulations"),.dealing with "reimbursement bond"proceeds, tieing proceeds:ofthe City'sbonds used to reimbutse.the City foe any-project-expenditure.paid.by the.'Citypriorto the tfnie-ofthe issuance oftthe bonds.: B) The Regulations'generally:require that the. City make a:declaration.of intentto. reiritburse.itself for. Wchexpenditures, out of the proceeds of subiequently issued.bondsi that such declaration be -made not later than.sixty(60) days after the expenditure is actually paid; and that the bonding occur and the written reimbursement allocation be made from the proceeds of such bonds within eighteen(l8) months after the later of (1) the date ofpaymeiit of the expenditure or (2) the date the project is. placed in service (but in no event morethan three(3) years after actual payinent). C) The City hereiofore.implemented procedures, for compliance.with thepredecessor,versions of the Regulations anddesires to amend and.suppterneot those procedures.to ensure..eotnpliance with the Regulations. D) T1ie..City's bond counsel has advised-ille City -that the Regulations do not.apply. -aud hence: the.provisions..of this Resolution areintended to have no application -:to payments of City Project costs first made bythe..City out of proceeds ofbonds issued.. prior to the date of such. payments.. 2. OFFICIAL INTENT DECLARATION: The Regulations,4irthe situations in which they apply, require the City to havedeclared an official intent (the "Declaration") to reimburse itself forpreviously paid project expenditures out. ofthe proceeds of subsequently - issued bonds, The CouncWhereby authorizes. the Citytkrk to makettte City's Declarations or to.delegate from time to time that: respansibility:to other appropriate City employees, 'Each Declaration shall comply with..the requirements, of the Regulations, including.without limitation the following: A) Each Declaration shall be made not more than sixty (60) days after the.paynient ofthe applicableproject costandshall state that the City reasonably erects .m. reimburse itself for the expenditure but pf -tiie proceeds of a bond issue or similar borrowing: Each Declaration may made -substantially in the form of the E7tln`bit.A which is attached to and rmde a part.of this Resolutiohi:orin any other foiinat which -may at the time comply with the Regulation6: B) Each. Declaration shall (1.) contain a reasonably accurate description of the "project", as defined ih the Regulations.(which may include. the. property .or.program to be financed, as applicablo), to which the expenditurerelates and (2) statethe. maximum. principal atiiqunt obonding expected. to be issued for that -project.. C) Care shall be. -taken so that. the: City, or it's authorized representatives under this Resolution, not.make Declarations in cases 'Nvhere'the City does not reasonably expect to issue: reimbursementbonds, to finance..the subject project costs and. the City officials are hereby authorind'to corisult-with bond counsel to the. City concerning the requirements of the Regulations and their application in particular 'circumstonces. D) The.Couneilshallbe*advisedfrom timt:totinieonthe 'dosimbilityand timing .ofthe issuance of reimbursembnt-b6 &relating - to project expenditures: for which. tbe'City hag made-Dtclaiations: 3. REIMBURSEMENT ALLOCATIONS. The.*s.ignated City ofificials shall also be responsible for making the "reimbursement -allocatiozW.' described in the Regulations, being generally -written allocations that evidence the City's use of the applicable bond -proceedt to reimburse .the original e:q=dihaw. 4. EFFECT: This Resolution shall amend And supplenietit all.prior resolutions and/or procedures adopted by the City -for compliance ,. wiih:the Regulations (or their predecessor versions) *and, :heubtfoith; in the event of any inconsistency, the: -provisions of -this Resolution s. all apply and *;avem.