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RESOLUTION NO. 94-R-06
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF EDGEWATER, FLORIDA, DECLARING OFFICIAL
INTENT OF REIMBURSEMENT OF CAPITAL
EXPENDITURES, REPEALING RESOLUTIONS IN
CONFLICT HEREWITH AND ESTABLISHING AN
EFFECTIVE DATE.
WHEREAS, the City Council of the City of Edgewater, Florida,
has made the following determinations:
1. The Florida Shores Road Improvement Program has been
authorized.
2. Prior to selecting the method of financing the project,
engineering and other project related costs will be incurred.
3. It is in the best interest of the citizens of Edgewater
that these costs be included within the financing of the project at
such time as the method of financing has been selected and that the
monies expended in the interim be reimbursed from the proceeds of
the selected financing method.
NOW THEREFORE, BE IT ENACTED by the City Council of the City
of Edgewater, Florida:
Section 1. The Internal Revenue Service has issued Section
1.150-2 of the Income Tax Regulations (the "Regulations") dealing
with the issuance of obligations, all or a portion of the proceeds
of which are to be used to reimburse the City for project
expenditures made by the City prior to the date of issuance of the
obligations.
The Regulations generally required that (1) the City make a
prior declaration of its official intent to reimburse itself for
such prior expenditures
out of the proceeds of a subsequently
issued borrowing,
( 2 )
that the borrowing occur and the
reimbursement allocation be made from the proceeds of such
borrowing within eighteen months of the payment of the expenditure
or, if longer, within eighteen months of the date the project is
placed in service but in no event more than 3 years after the
original expenditure is paid, and (3) that the expenditure be a
capital expenditure.
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This Council has determined that it is necessary and in the
best interests of the City to provide for paving and the
construction of certain road improvements pursuant to the Florida
Shores Road Improvement Project. It is presently expected that the
total projected costs of these capital expenditures are
approximately fifteen million dollars ($15,000,000.00). The City
intends to finance all or a portion of such cost through the
issuance of long term financing obligations, the interest on which
is intended to be excludable from the gross income of the recipient
for federal income tax purposes. The City expects to make
expenditures for costs relating to the capital expenditures after
the date of this resolution and prior to the issuance of such
obligations or finalizing the terms of financing the cost of the
capital expenditures.
Section 2. The City proposes to undertake the payment of the
capital expenditures. Other than (1) expenditures to be paid or
reimbursed from sources other than a borrowing or (2) expenditures
constituting preliminary expenditures as defined in Section 1.150-
2(f)(2) of the Regulations, no expenditures have heretofore been
made by the City and no expenditures will be made by the City until
after the date of this resolution. The City reasonably expects to
reimburse the expenditures made for costs of the capital
expenditures out of the proceeds of an issue of bonds payable from
special assessments levied against benefitted properties or other
form of financing obligation (the "Obligation") to be incurred by
the City in a maximum principal amount of fifteen million dollars
($15,000,000.00) after the date of payment of all or a portion of
such costs. All reimbursed expenditures shall be capital
expenditures as defined in Section 1.150-1(b) of the Regulations.
Section 3. Except as described below, as of the date hereof,
there are no funds of the City 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
capital expenditures, other than pursuant to the Obligation. This
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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, all within the meaning
and content of the Regulations.
Section 4. All resolutions or parts of resolutions in
conflict herewith be and the same are hereby repealed.
Section S. This resolution shall take effect upon
adoption.
After Motion by Councilman Mitchum and Second by Councilman
Hays, the vote on this resolution was as follows:
Mayor Jack H. Hayman, Sr. AYE
Councilman Kirk Jones AYE
Councilwoman Louise A. Martin AYE
Councilman Mike Hays AYE
Councilman David L. Mitchum AYE
PASSED AND DULY ADOPTED this 4th day of April, 1994.
ATTEST:
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CITY COUNCIL OF THE
CITY OF EDGEWATER, FLORIDA
Jack H. yman,Sr-.
Mayor
Kiis a A. Storey
City Attorney