Res 21-13RESOLUTION NO. 21-13
A RESOLUTION OF THE CITY COMMISSION OF THE
CITY OF DELRAY BEACH, FLORIDA, DECLARING OF
OFFICIAL INTENT WITH RESPECT TO REIMBURSEMENT
OF TEMPORARY ADVANCES MADE FOR CAPITAL
EXPENDITURES TO BE MADE FROM SUBSEQUENT
BORROWINGS; AND PROVIDING FOR AN EFFECTIVE
DATE.
WHEREAS, Treasury Regulation � 1.150 -2 (the "Reimbursement Regulations "), issued
pursuant to Section 150 of the Internal Revenue Code of 1986, as amended, (the "Code ") prescribes
certain requirements by which proceeds of tax - exempt bonds, notes, certificates or other obligations
included in the meaning of "bonds" undet Section 150 of the Code ( "Obligations ") used to reimburse
advances made for Capital Expenditures (as hereinafter defined) paid before the issuance of such
Obligations may be deemed "spent" for purposes of Sections 103 and 141 to 150 of the Code and
therefore, not further subject to any other requirements or restrictions. under those sections of the
Code; and
WHEREAS, such Reimbursement Regulations require that an Issuer (as hereinafter defined)
make a Declaration of Official. Intent (as hereinafter defined) to reimburse any Capital Expenditure
paid prior to the issuance of the Obligations intended to fund such Capital Expenditure and require
that such Declaration of Official Intent be made no later than sixty (60) days after payment of the
Capital Expenditure and further require that any Reimbursement Allocation (as hereinafter defined)
of the proceeds of such Obligations to reimburse such Capital Expenditures occur no later than
eighteen (18) months after the later of the date the Capital Expenditure was paid or the date the
property acquired with the Capital Expenditure was placed in service, except that any such
Reimbursement Allocation must be made no later than three years after such Capital Expenditure
was paid; and
WHEREAS, the CITY OF DELRAY BEACH (the "Issuer ") wishes to ensure compliance
with the Reimbursement Regulations;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF
THE CITY OF DELRAY BEACH, FLORIDA, AS FOLLOWS::
Section 1. Definitions. The following definitions apply to the terms used herein:
"Allocation" means written evidence that proceeds. of Obligations issued subsequent to the
payment of a Capital Expenditure are to reimburse the Issuer for such payments. "To allocate"
means to make such an allocation.
"Capital Expenditure" means any expense for an item that is properly depreciable or
amortizable or is otherwise treated as a capital expenditure for purposes of the Code, as well as any
"Declaration of Official Intent" means a written declaration that the Issuer intends to fund
Capital Expenditures with an issue of Reimbursement Bonds and reasonably expects to be
reimbursed from the proceeds of such an issue.
"Issuer" mi either a governmental unit that is reasonably expected to issue Obligations, or
any governmental or 501(c)(3) organization that is reasonably expected to borrow funds from
the actual issuer of the Obligations.
"Reimbursement" means the restoration to the Issuer of money temporarily advanced from
other funds, including moneys borrowed from other sources, of the Issuer to pay for Capital
Expenditures before the issuance of Obligations intended to fund such Capital Expenditures. "To
reimburse" means to make such a restoration.
"Reimbursement Bonds" means Obligations that are issued to reimburse the Issuer for
Capital Expenditures, and for certain other expenses permitted by the Reimbursement Regulations,
previously paid by or for the Issuer.
"Reimbursement Regulations" means Treasury Regulation � 150 -2 and any amendments
thereto or superseding regulations, whether in proposed, temporary or final form, as applicable.,
prescribing conditions under which the proceeds of Obligations may be allocated to reimburse the
Issuer for Capital Expenditures and certain other expenses paid prior to the issuance of the
Obligations such that the proceeds of such Obligations will be heated as "spent" for purposes of
Sections 103 and 141 to 150 of the Code.
Section 2. Declaration of Official Intent.
(a) The Issuer declares that it reasonably expects that the Capital Expenditures described in
Section (b), which were paid no earlier than sixty (60) days prior to the date hereof, or which will be
paid prior to the issuance of any Obligations intended to fund such Capital Expenditures, will be
reimbursed with the proceeds of Obligations, representing a borrowing by the Issuer in the
approximate principal amount for such Reimbursements of approximately $10,000,000; and
(b) The Capital Expenditures to be reimbursed are to be used for Beach Renourishment
Project as well as the Federal I-Eghway Beautification Project.
(c) Section 3. Reasonable Expectations. The Issuer does not expect any other funds
(including the money advanced to make the Capital Expenditures that are to be reimbursed), to be
reserved, allocated on a long -term basis, or otherwise set aside by the Issuer or any other entity, with
respect to the Capital Expenditures for the purposes described in Section 2(b).
Section 4. Open Meeting. It is found and determined that all formal actions of this
Commission of the Issuer concerning and relating to the adoption of this resolution were adopted in
an open meeting of this Commission of the Issuer; and that all deliberations of this Commission of
the Issuer and of any of its committees that resulted in such formal action, were in meetings open to
the public, in compliance with the law.
Res No. 21 -13
PASSED AND ADOPTED in regular session on the 191h day of March, 2013.
ATTEST:
CITY CLERK
MAYOR
Res No. 21 -13
Coversheet
MEMORANDUM
TO: Mayor and City Commissioners
FROM: David A. Boyd,. Director of Finance
Rebecca S. O'Connor, Treasurer
THROUGH: Douglas E. Smith, Interim City Manager
DATE: March 13, 2013
SUBJECT: AGENDA ITEM 9.C. - REGULAR COMMISSION MEETING OF MARCH 19, 2013
RESOLUTION NO. 21-13
ITEM BEFORE COMMISSION
Authorize Resolution No. 21-13.
BACKGROUND
Page 1 of 1
Resolution No. 21 -13 declares an official intent with respect to reimbursement of temporary advances
made for capital expenditures to be made from a subsequent borrowing. The City will be reimbursing
expenses relative to the Beach Renourishment Project as well as the Federal Highway Beautification
Project. The City is required by the IRS to issue a Declaration of Intent if expenses are incurred for
capital projects prior to receiving funding. Tax law requires that a declaration be made within 60 days of
the first capital expense relative to a project or asset. This declaration falls within the 60 day period and,
therefore, provides for compliance.
RECOMMENDATION
Recommend Commission approval of Resolution No. 21 -13
http: // agendas. mydelraybeach .com /Bluesheet.aspx ?Itemm- 6592 &MeetingTD =405 3/22/2013