Attached is a Resolution prepared by the City's bond counsel, Fulbright & Jaworski L.L.P. that expresses the official intent of the City to reimburse project expenditures with proceeds of tax exempt General Obligation Bonds.
Under Treasury regulations, a city may advance monies for projects and reimburse itself with proceeds from a tax exempt bond issue if the city has officially declared the intent to take such action. The intent must be declared within 60 days of the date of the original expenditure.
The City plans to advance an amount that may be approximately $960,000 for public safety facility maintenance and improvement for Central Fire Station, $610,000 for public facilities construction for parking at the Library and $760,000 for streets and drainage projects; specifically, arterial roadways. The repairs and renovations are expected to begin prior to the bond proceeds being received in June of 2017. Therefore, this Reimbursement Resolution is necessary to pay for the expenditures. The advanced funding will come from the City's General Fund.
By Treasury regulations, the City must repay the advance within 18 months. The plan is to make the reimbursements with proceeds from General Obligation Bonds, Series 2017. The Series 2017 Bonds will impact the Fiscal Year 2018 Debt Service budget.
The maximum reimbursement shown in the Reimbursement Resolution is $2,330,000. Bond Counsel and their Tax Attorney advised to show the total amount of Series 2017 bonds planned to be issued associated with the "Street & Drainage" category of $760,000, "Public Safety" category of $960,000 and the "Public Facilities" category of $610,000 for an overall maximum amount of $2,330,000.
The G.O. Bond Issue, Series 2017, will include the reimbursement amount shown above plus amounts from other categories such as Parks & Recreation, Public Safety and Streets and Drainage.