H3. Res 6074 Reimbursement Lift Station 9City of Kalispell
Charles A. Harball Office of City Attorney
City Attorney 201 First Avenue East
P.O. Box 1997
Kalispell, MT 59903-1997
TO:
FROM:
MEMORANDUM
Doug Russell, City Manager
Charles Harball, City Attorney
Tel 406.758.7709
Fax 406.758.7758
charball@kalispell.com
SUBJECT: Resolution No. 6074 — A Resolution of Intent to Reimburse Certain
Allowable Preliminary Expenditures Made by the City on Lift Station 49
from State Revolving Fund Bond Proceeds
MEETING DATE: May 16, 2022 —Regular Council Meeting
BACKGROUND: As discussed with the City Council at previous budget discussions, the City's Lift
Station 99 project, located within the Fairview Boulevard Subdivision, is scheduled to begin
construction in this calendar year. All the necessary easements for the proj ect are in place. The proj ect
shall be financed through bonding from the Montana State Revolving Fund.
The purpose of the resolution before the City Council at this meeting is to approve the reimbursement
of any allowable preliminary expenditures previously made by the City on the project to be reimbursed
by the bond when those funds become available. This resolution is necessary to comply with certain
Treasury Regulations that otherwise permit the reimbursement of capital expenditures and the costs of
issuance of bonds on a capital project.
RECOMMENDATION: It is recommended that Council pass Resolution No. 6074
CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE
I, the undersigned, being the duly qualified and acting recording officer of the City of Kalispell,
Montana (the "City"), hereby certify that the attached resolution is a true copy of a Resolution entitled:
"RESOLUTION RELATING TO FINANCING OF A CERTAIN PROPOSED SEWER LIFT STATION
REPLACEMENT PROJECT; ESTABLISHING COMPLIANCE WITH REIMBURSEMENT BOND
REGULATIONS UNDER THE INTERNAL REVENUE CODE IN ADVANCE OF THE PROPOSED
ISSUANCE OF REVENUE BONDS BY THE CITY OF KALISPELL TO PROVIDE FUNDS TO PAY
FOR THE COSTS OF A SEWER LIFT STATION REPLACEMENT PROJECT" (the "Resolution"), on
file in the original records of the City in my legal custody; that the Resolution was duly adopted by the City
Council of the City at a regular meeting on May 16, 2022, and that the meeting was duly held by the City
Council and was attended throughout by a quorum, pursuant to call and notice of such meeting given as
required by law; and that the Resolution has not as of the date hereof been amended or repealed.
I further certify that, upon vote being taken on the Resolution at said meeting, the following City
Council members voted in favor thereof:
(SEAL)
voted against the same:
abstained from voting thereon:
or were absent:
WITNESS my hand and seal officially this day of May, 2022.
Aimee Brunckhorst
City Clerk
RESOLUTION NO. 6074
RESOLUTION RELATING TO FINANCING OF A CERTAIN PROPOSED SEWER
LIFT STATION REPLACEMENT PROJECT; ESTABLISHING COMPLIANCE WITH
REIMBURSEMENT BOND REGULATIONS UNDER THE INTERNAL REVENUE
CODE IN ADVANCE OF THE PROPOSED ISSUANCE OF REVENUE BONDS BY
THE CITY OF KALISPELL TO PROVIDE FUNDS TO PAY FOR THE COSTS OF A
SEWER LIFT STATION REPLACEMENT PROJECT.
BE IT RESOLVED by the City Council of the City of Kalispell, Montana (the "City"), as follows:
Section 1. Recitals.
1.01 The United States Department of Treasury has promulgated final regulations governing the
use of proceeds of tax-exempt bonds, all or a portion of which are to be used to reimburse the City for
project expenditures paid by the City prior to the date of issuance of such bonds. Those regulations
(Treasury Regulations, Section 1.150-2) (the "Regulations") require that the City adopt a statement of
official intent to reimburse an original expenditure not later than 60 days after payment of the original
expenditure. The Regulations also generally require that the bonds be issued and the reimbursement
allocation made from the proceeds of the bonds within 18 months (or three years, if the reimbursement
bond issue qualifies for the "small issuer" exception from the arbitrage rebate requirement) after the later
of (i) the date the expenditure is paid or (ii) the date the project is placed in service or abandoned, but (unless
the issue qualifies for the "small issuer" exception from the arbitrage rebate requirement) in no event more
than three years after the date the expenditure is paid. The Regulations generally permit reimbursement of
capital expenditures and costs of issuance of the bonds.
1.02 The City desires to comply with requirements of the Regulations with respect to certain
projects hereinafter identified.
Section 2. Official Intent Declaration.
2.01 The City proposes to undertake a certain sewer lift station replacement project (the
"Project").
2.02 Other than (i) expenditures to be paid or reimbursed from sources other than the Bonds
(as hereinafter defined), (ii) expenditures permitted to be reimbursed under the transitional provision
contained in Section 1.150-20)(2) of the Regulations, (iii) expenditures constituting preliminary
expenditures within the meaning of Section 1.150-2(f)(2) of the Regulations, or (iv) expenditures in a "de
minimus" amount (as defined in Section 1.150-2(f)(1) of the Regulations), no expenditures for the Project
have heretofore been paid by the City and, other than preliminary expenditures, no expenditures for the
Project will be paid by the City until after the date of this Resolution.
2.03 The City reasonably expects to reimburse some or all of the expenditures made for costs
of the Project out of the proceeds of debt in one or more series or of one or more kinds in an estimated
maximum aggregate principal amount of up to $1,600,000 (the "Bonds") after the date of payment of all or
a portion of the costs of the Project. All reimbursed expenditures shall be capital expenditures, a cost of
issuance of the Bonds or other expenditures eligible for reimbursement under Section 1.150-2(d)(3) of the
Regulations.
Section 3. Budgetary Matters. As of the date hereof, there are no City funds reserved, allocated
on a long-term basis or otherwise set aside (or reasonably expected to be reserved, allocated on a long-term
basis or otherwise set aside) to provide permanent financing for the expenditures related to the Project,
other than pursuant to the issuance of the Bonds. The statement of intent contained in this resolution,
therefore, is determined to be consistent with the City's budgetary and financial circumstances as they exist
or are reasonably foreseeable on the date hereof.
Section 4. Reimbursement Allocations. The Administrative Services Director shall be responsible
for making the "reimbursement allocations" described in the Regulations, being generally the transfer of
the appropriate amount of proceeds of the Bonds to reimburse the source of temporary financing used by
the City to make prior payment of the costs of the Project. Each allocation shall be evidenced by an entry
on the official books and records of the City maintained for the Bonds or the Project and shall specifically
identify the actual original expenditure being reimbursed.
Adopted this 16th day of May, 2022.
Mark Johnson
Mayor
ATTEST:
Aimee Brunckhorst
City Clerk
EXHIBIT A
Description of Project
Relocation of Waste Water Lift Station #9
DMFIRM #402978195 v3