MEMO TO: Members of the City Council
FROM: Mayor John Marchione
SUBJECT:
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Adoption of a Resolution Authorizing the City to Reimburse Certain Capital Improvement Expenditures from the Proceeds of the Sale of Bonds
a. RESOLUTION NO. 1514: A Resolution Declaring its Intent that Certain Capital Expenditures to be Made Shall be Reimbursed from the Proceeds of Tax Exempt Bonds or Other Obligations
I. RECOMMENDED ACTION
recommendation
Adopt the Resolution authorizing the City to reimburse certain capital improvement expenditures from the proceeds of the sale of bonds.
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II. DEPARTMENT CONTACTS
Malisa Files, Finance Director 425-556-2166
Kelley Cochran, Deputy Finance Director 425-556-2748
Kelley Wood, Financial Services Manager 425-556-2161
III. DESCRIPTION/BACKGROUND
Consistent with the 2019/2020 budget, capital investment strategy, and utility financial plans staff anticipates the sale of up to $20,000,000 of bonds to provide resources for the Wastewater Capital Investment Program. The wastewater bond proceeds will be used towards pump station improvements and force main installation projects. The City anticipates expenditures related to the early phases of these projects, including property and/or right-of-way acquisitions and design work, will occur prior to the issuance of the related bonds. Some early expenditures have already begun to be incurred.
When this situation occurs (expenditures are incurred prior to the issuance of related debt) Internal Revenue Service regulations require that the City declares its intent to use bond proceeds to reimburse expenditures incurred prior to the sale of bonds. The proposed Resolution conforms to that requirement however does not commit the City to issue bonds. Further, the resolution does not dictate or influence the amount of bonds that may eventually be sold to provide resources for these projects. The proposed resolution provides for a high estimate the amount of the pote...
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