15. Resolution 4961 - Reimbursement Resolution - Fire Station 62C-11ity of Kalispell
Post Office Box i 97 - Kalispell, Monuina 5990 -1997 - e e hOn (40 )758-7700 Fy_x (= )758-77
REPORT TO: Mayor Kennedy and City Council Members
FROM: Any Robertson, Finance Director
Janes H. Patrick, City Manager
SUBJECT: Fire Hall Reimbursement Resolution
MEETING DATE: December 6, 2004
BACKGROUND: The City will be selling General Obligation Bonds (G. O. Bonds) in the
spring; after the bids for the new Fire Hall are received. In order to cover the expenses prior to
sale of the bonds we need to adopt a reimbursement resolution. We have adapted reimbursement
resolutions in the past as it is common practice to include the preliminary costs associated with a
project in the financing. The resolution was prepared by our bond counsel.
RECOMMENDATION: Adopt Reimbursement Resolution.
ALTERNATIVES: At Council's discretion.
Amy H. Robertson
Finance Director
Report compiled: November 23, 2004
.lames H. Patrick
City Manager
RESOLUTION NO.4961
RESOLUTION RELATING TO FINANCING OF CERTAIN PROPOSED PROJECTS;
ESTABLISHING COMPLIANCE WITH REIMBURSEMENT BOND REGULATIONS
UNDER THE INTERNAL REVENUE CODE
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 frog, 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 pen -nit
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 certain projects, which projects and the estimated
costs thereof are generally described on Exhibit A hereto, which is hereby incorporated herein
and made a part hereof (the "Projects").
2.02 Other than (1) expenditures to be paid or reimbursed from sources other than the
Bonds (as hereinafter defined), (ii) expenditures penrtitted 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 Projects have heretofore been paid by the City and
no expenditures 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 Projects out of the proceeds of debt in an estimated maximum aggregate principal
amount of $3,000,000 (the "Bonds") after the date of payment of all or a portion of the costs of
the Projects. 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 Projects, 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 City Finance 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 Projects. Each
allocation shall be evidenced by an entry on the official books and records of the City maintained
for the Bonds or the Projects and shall specifically identify the actual original expenditure being
reimbursed.
Adopted this 6th day of December, 2004.
ATTEST:
Theresa White
City Clerk
Pamela B. Kennedy
Mayor
N
EXHIBIT A
Description of Projects Estimated Cost
North Fire Hall No.62 $3,000,000
November 2, 2004 voters approved a $3,000,000 G. O. bond to construct the City' first satellite
fire station on the north end of town. Design is currently under way and this resolution will
allow for reimbursement of costs from the bond proceeds. Bonds will be issued after the bids are
accepted in the Spring of 2005.
A-1