Resolution - #09-10-252 No Signature - 10/27/2009

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in the manner herein specified until all of the Bonds and the interest thereon have been fully paid. There shall be maintained in the Fund separate accounts, to be designated the II Construction Account" and "Debt Service Account", respectively, (a) Construction Account. To the Construction Account there shall be credited the proceeds of the sale of the Bonds, less accrued interest received thereon. From the Construction Account there shall be paid all costs and expenses of making the Improvements, including the . cost of any construction contracts heretofore let and all other costs incurred and to be incurred of the kind authorized in Minnesota Statutes, Section 475.65. The moneys in the Construction Account shall be used for no other purpose except as otherwise provided by law; provided that the proceeds of the Bonds may also be used to the extent necessary to pay interest on the Bonds due prior to the anticipated date of commencement of the collection of taxes herein levied or covenanted to be levied; and provided further that if upon completion of the Improvements there shall remain any unexpended balance in the Construction Account, the balance shall be transferred to the Debt Service Account or may be used for additional State-Aid street improvements or for such other public and eligible purpose authorized by the Council pursuant to applicable law, (b) . Debt Service Acco"unt. There are hereby irrevocably appropriated and pledged to, and there shall be credited to, the Debt Service Account an amount of moneys allotted or to be allotted to the City from its account in the Municipal State-Aid Street Fund sufficient to pay the principal of and interest on the Bonds, when due. Upon receipt from the Commissioner of Finance of the annual amount of money needed for payment of principal and interest due each _ year, the allotment shall be deposited in the Debt Service Account. There are also hereby . irrevocably appropriated and pledged to, and there shall be credited to, the Debt Service Account: (i) accrued interest received upon delivery of the Bonds; (H) any collections of all taxes herein or hereafter levied for the payment of the Bonds and interest thereon; (Hi) all funds remaining in the Construction Account after completion of the Improvements and payment of the costs thereof; (iv) all investment earnings on funds held in the Debt Service Account; and (v) any and all other moneys which are properly available and are appropriated by the governing body of the City to the Debt Service Account. The Debt Service Account shall be used solely to pay the principal and interest and any premiums for redemption of the Bonds and any other general , obligation bonds of the City hereafter issued by the City and made payable from the Debt Service Account as provided by law. No portion of the proceeds of the Bonds shall be used directly or indirectly to acquire higher yielding investments or to replace funds which were used directly or indirectly to acquire higher yielding investments, except (i) for a reasonable temporary period until such proceeds are needed for the purpose for which the Bonds were issued and (H) in addition to the above in an amount not greater than the lesser of five percent of the proceeds of the Bonds or $100,000. To this effect, any proceeds of the Bonds and any sums from time to time held in the Construction Account or Debt Service Account (or any other City account which will be used to pay principal or interest to become due on the bonds payable therefrom) in excess of amounts which under then applicable federal arbitrage regulations may be invested without regard to yield shall not be invested at a yield in excess of the applicable yield restrictions imposed by the arbitrage regulations on such investments after taking into account any applicable "temporary periods II or "minor portion" made available under the federal arbitrage regulations. Money in the Fund shall 2413138vl