102201 EDA AgP
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c:JTY OF SHORlWOOD
'CONOMlC DEVELOPMENT AUTHORITY MEETING
MONDAY, OCTOBER. n,_1
5755 COUNTltYCLUB ROAD
COUNCIL CHAMBERS
8:00 P.M. or immediately fonowing
aeplar meetlng ~.
AGENDA
1. CONVENE ECONOMIC DEVELOPMENT AUTHORITY MEETING
A. Roll Call
President t.ove_
Garfunkel_
Liz6e _
. Zerby _
Turgeon _
B. Review Agenda
2. APPROVAL OF MINUTES
A. EDA Minutes of October 8,2001 (Att.-#2A Minutes)
3. NEW BUSINESS
A. Reimbursement Resolution (Att.-#3A Finance Director's memorandum, Proposed
Resolution, Summary of Treasury Regulations)
4. OTHER BUSINESS
5. ADJOURN
CITY OF SHOREWOOD
ECONOMIC DEVELOPMENT AUTHORITY MEETING
MONDAY, OCTOBER 8, 2001
5755 COUNTRY CLUB ROAD
COUNCIL CHAMBERS
8:00 P.M. or immediately following
Regular meeting
MINUTES
\) 1\~1
1. CONVENE ECONOMIC DEVELOPMENT AUTHORITY MEETING
The Chair called the meeting to order at 7:47 P.M.
A.
Roll Call
Present:
President Love; Commissioners Garfunkel, Lizee, Turgeon, and Zerby; Assistant Treasurer
Burton; Attorney Keane and Executive Director Dawson
Absent:
Assistant Director Nielsen
B.
Review Agenda
Without objection from the Board of Commissioners, the Chair reviewed the Agenda and found it without
amendment.
2. NEW BUSINESS
The Chair called for a motion for appointment of EDA officers and approval of Bylaws.
A. Approval of Bylaws
B. Appointment of Officers
Garfunkel moved, Zerby seconded, Adopting the Bylaws and Appointing Commissioner Garfunkel to
the office of Vice-President; Commissioner Lizee to the office of President Pro Tern; and Commissioner
Zerby to the office of Treasurer; with terms through July 22, 2002. Motion passed 5/0.
3. OTHER BUSINESS
There was no other business to be acted upon this evening.
4. ADJOURN
Lizee moved, Zerby seconded, adjourning the October 8, 2001, Economic Development Authority
Meeting at 7:55 P.M. Motion passed 5/0.
RESPECTFULLY SUBMITTED,
Sally Keefe,
Recording Secretary
Woody Love, President
Craig W. Dawson, Executive Director
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CITY OF
SHOREWOOD
5755 COUNTRY CLUB ROAD. SHOREWOOD, MINNESOTA 55331-8927. (952) 474-3236
FAX (952) 474-0128. www.ci.shorewood.mn.us. cityhall@cLshorewood.mn.us
MEMORANDUM
Date:
October 18,2001
From:
or
Honorable Mayor and City Council Members
Bonnie Burton, Finance DirectorlTreasurer ~
To:
Re:
EDA Reimbursement Resolution-FireStation Project
Background Discussion
The City of Shorewood and the Economic Development Authority have expended
funds, with City Council approval, on behalf ofthe Fire District Project. It is the
City's intent that it will be reimbursed for these expenditures from the proceeds of
the sale of bonds for this project next spring. In order to do this and be in
compliance with Internal Revenue Service regulations, the City Council, acting as
the EDA Board, must approve a 'Reimbursement Resolution'.
Therefore, attached for Council review and approval is a resolution 'Declaring the
Official Intent of the Economic Development Authority of the City of Shorewood
to Reimburse Certain Expenditures from the Proceeds of Bonds". This proposed
resolution was provided by bond counsel attorneys, Kennedy & Graven, along
with a summary of treasury regulations describing the requirements.
Recommended Action:
The City Council is requested to review and approve the proposed resolution
'Declaring the Official Intent of the Economic Development Authority of the City
of Shore wood to Reimburse Certain Expenditures from the Proceeds of Bonds' .
Cc: Craig W. Dawson, City Administrator
#3f1
#.
\,.1 PRINTED ON RECYCLED PAPER
CITY OF SHOREWOOD
RESOLUTION NO. 01-
A RESOLUTION DECLARING THE OFFICIAL INTENT OF THE ECONOMIC
DEVELOPMENT AUTHORITY OF THE CITY OF SHOREWOOD TO REIMBURSE
CERTAIN EXPENDITURES FROM THE PROCEEDS OF BONDS TO BE ISSUED BY
THE AUTHORITY
WHEREAS, the Internal Revenue Service has issued Treas. Reg. S 1.150-2 providing
that proceeds of tax-exempt bonds used to reimburse prior expenditures will not be deemed spent
unless certain requirements are met; and,
WHEREAS, the Authority expects to incur certain expenditures that may be financed
temporarily from sources other than bonds, and reimbursed from the proceeds of a bond;
NOW THEREFORE, BE IT RESOLVED BY THE ECONOMIC DEVELOPMENT
AUTHORITY OF THE CITY OF SHOREWOOD (THE" AUTHORITY") AS FOLLOWS:
1. The Authority reasonably intends to make expenditures for the project described in Exhibit A
(the "Project"), and reasonably intends to reimburse itself for such expenditures from the
proceeds of debt to be used by the authority in the maximum principal amount described in
Exhibit A.
2. The Executive Director is authorized to designate appropriate additions to Exhibit A in
circumstances where time is of the essence, and any such designation shall be reported to the
board at the earliest practicable date and shall be filed with the official books and records of
the authority.
3. This resolution is intended to constitute a declaration of official intent for purposes ofTreas.
Reg. S 1.150~2 and any successor law, regulation, or ruling.
APPROVED BY THE BOARD OF COMMISSIONERS OF THE ECONOMIC
DEVELOPMENT AUTHORITY OF THE CITY OF SHOREWOOD this 22nd day of
October 2001.
ECONOMIC DEVELOPMENT AUTHORITY OF
THE CITY OF SHOREWOOD, MINNESOTA
WOODY LOVE, PRESIDENT
ATTEST:
CRAIG W. DAWSON, EXECUTIVE DIRECTOR
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Date of Declaration
October 22, 2001
EXHIBIT A
TO OFFICIAL INTENT RESOLUTION
Description of Proj ect
Fire & Police Station Project
Maximum Principal
Amount of Debt
for Project
$10,000,000
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10-03-01 20:58
From-KENNEDY & GRAVEN
+6123379310
T-047 p,Oa/09 F-006
The issuer must have a reason~ble ex.pectation that it will acrually incur the Ilescri'bed expenditUres
and later reimburse Lhem with bona proceeds. It is not reasonable to make "blanket declarations"
(say, for aU public inlpruvemems the CIty may constrUct), or in amounTS that sUb,!;tantially exceed
the amount expected to be necessary for the project. Also, a pattern of failing to reimburse actual
expenditures covered by declarations will be evidence of unreasoni1.bleness. No decl;:U'i1.tilln is
needed-and m fact none sho1.Jld be m.ade-if me City knows th~t all project COStS will be paid after
proceeds of the bonds are in hand.
2. Exceptions to the Intent Requirement. There ate tWO types of ex:penclilures a. City
may relrnbunle from bond proceeds withOl.n having made a declaration:
" A "de minimis amount," which is rhe lesser 01$100,ooU or 5 percent of the proceeds of
the iss1.Je; and
. "Preliminary expendiMes" in un amount up to 20 percen~ of the issue price of the
bauds. Preliminary expenQitures mclude archirecroli:ll, engineering, survey. soU resting,
COStS of bond issuMce, an4 similar costs that. are incurred prior to commencement of
j:\cquisition. constrUction or relll:lbllilation at' a project, Land acquisiuon. site preparation
and slmi1~ COSts l:l!e nor preliminary expendi1:l.m:~s, 'tmltberefore m.ust be included in the
declaration.
3. The Reimbursem~Jlt Allocation. Once bOUQS an: issued, the <<.:lty must in writing
allocate the proceeds to relmtlursc the original expendImre- There is no ~jpecific form for the
wming; a Star.emenL hy the fin"m."e direclOf in the records for the project will suftit.;e.
4,
periods:
Tim~ Limits. A city must make the reimbursement allocation within these time
/:I."
Generally. The allocatiun mUSt be made no later than 1 B months afrer 'lilt: taler uf
. the da~e 'the expenditure W'.lS paid; or
. the t!ate the project is place in service. butin no evem larer th"-n 3 years after the date the
expenditure W~ pald.
b. Sma111s;)'uft Bond.\". For bonds mat meet the .'small iss1.Je" exception ~o the rebate
requirement (thi.\.]: is. bonds ~$ued when The City docs nut reasonably expect to issue more than $5
milliou:tu bonds in that calendar year), the 18-ulUolh limil described above is extenCl.ed to 3 years,
aut! the 3-year limit from the {j.ate of expenditure is deleted. In other words. proceeds of a small
lssue bond lUi.\.Y be used to reimhurse ~ plior expendlture up to 3 years utter the d~te the project is
placed in gervic:e, no matter how long mat OCcurs i:!fJ;er the dare ot" the original expendi~ure.
c. L()ng~li'tm constr14cnon projects. If the city and a licensed ~hit:ect or engineer
certify mat i:l.~ least 5 years is needed ~o conlplete constrUction of a projel.'l, the maximum
reimbursement period desl.:ribed in paragraph (a) is extended to 5 yei.\.r::i.
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