Agenda - Economic Development Authority - 02/02/2005 - Special

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ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF RAMSEY, MINNESOTA Member introduced the following resolution and moved its adoption: RESOLUTION ESTABLISHING PROCEDURES RELATING TO COMPLIANCE WITH REIMBURSEMENT BOND REGULATIONS UNDER THE INTERNAL REVENUE CODE BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority of the City of Ramsey, Minnesota (the "Authority"), as follows: 1. Recitals. (a) The Internal Revenue Service has issued Treasury Regulations, Section 1.150-2 (as the same may be amended or supplemented, the "Regulations"), dealing with "reimbursement bond" proceeds, being proceeds of bonds used to reimburse the Authority for any project expenditure paid by the Authority prior to the time of the issuance of those bonds. (b) The Regulations generally require that the Authority (as the issuer of or the primary obligor under the bonds) make a declaration of intent to reimburse itself for such prior expenditures out of the proceeds of subsequently issued bonds, that such declaration be made not later than 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 18 months after the later of (1) the date of payment of the expenditure or (2) the date the project is placed in service (but in no event more than 3 years after actual payment). (c) The Authority heretofore implemented procedures for compliance with the predecessor versions of the Regulations and desires to amend and supplement those procedures to ensure compliance with the Regulations. (d) The Authority's bond counsel has advised the Authority that the Regulations do not apply, and hence the provisions of this Resolution are intended to have no application, to payments of Authority project costs first made by the Authority out of the proceeds of bonds issued prior to the date of such payments. 2. Official Intent Declaration. The Regulations, in the situations in which they apply, require the Authority to have declared an official intent (the "Declaration") to reimburse itself for previously paid project expenditures out of the proceeds of subsequently issued bonds. The Council hereby authorizes the Executive Director to make the Authority's Declarations or to delegate from time to time that responsibility to other appropriate Authority employees. Each Declaration shall comply with the requirements of the Regulations, including without limitation the following: (a) Each Declaration shall be made not later than 60 days after payment of the applicable project cost and shall state that the Authority reasonably expects to reimburse itself for the expenditure out ofthe proceeds of a bond issue or similar borrowing. Each Declaration may be made substantially in the form of the Exhibit A which is attached to 1437103vl