Title
Consider and take action on a resolution declaring the City's official intent to reimburse certain costs with the proceeds from tax-exempt obligations (Director of Finance)
Background:
Adopting a resolution declaring the City's intent to reimburse an expenditure with proceeds from an obligation is required by the Internal Revenue Service (IRS).
The Fiscal Year 2018-19 Budget and Capital Improvement Program (CIP) includes projects that are planned to be funded from the proceeds of a debt issue. Within the CIP, Fire Station #6 is to be funded with the sale of debt. Certificates of Obligation are scheduled for Council approval on October 9th, with an anticipated fund date of October 18th. The Fire Station #6 in the amount of $4,358,000 will be funded from the Miscellaneous Capital Projects Fund 5015 and the Miscellaneous Capital Projects Fund 5015 will be reimbursed by the Certificate of Obligations, Series 2018 proceeds once issued.
The IRS does allow projects to begin prior to the debt being issued, as long as the City declares its intent to reimburse from the issuance of the debt. This statement must be made within 60 days of the first expenditure of funds that will be reimbursed. To comply with all legal requirements, the City Council must adopt this resolution making public their intentions to reimburse the Miscellaneous Capital Projects Fund in the amount of $4,358,000 for these expenditures.
ATTACHMENTS:
1. Data Sheet
2. Proposed Resolution
FUNDING
{x} NOT APPLICABLE