1994 058 Ordinance - Laserfiche WebLink

Home Browse Search

(Rev. 6/93) _NSTZUCTLI ONS for DECI,ARATION OF OFFICIAL INTENT For Rei:nDUrsemenc From Tax-Exempt Bonds/Notes PURPOSE T' he form to wtuch these insuuctions pertain is intended for use under Treasury Regulations § 1.150-2 (the Reguulations) in order that an ezpendicure chat is paid with moneys temporarily advanced from ocher funds and is reasonably ezpected to be reimbuised from proceeds of subsequendy issued noces or bonds may qualify for such reimbursement. Failure [o comply caa result in serious consequences. With certain exceptions for qualified 'preiiminary expeadinues" and cet[aia de minimie ezpeaditutes, a Declaration of Official Intent must be made noc later than 60 days after payment of t?fie capical ezpenditure ezpeczed to be reimbursed from proceeds of obligations. The "reasonable ezpectation" test will be failed if the Issuer merely syscematically makes the declarazian for all ezpenditures or ia ezaggerated amaunu regardless of real expectauans. In general "capital expenditures" inciude (subject to any more resrricrive state law) aay costs reiated to the acquisition or construcnon of tand or interests in real estate. buildings, suucrures, additions thereso, or other permanent improvements, and ratorarion or bettermenu made to increase the value of properry or substantially prolong iu useful life, aad also of machinery, eguipment, furniture and fizmres having a useful life of az least one year or such longer period as is required by applicable stau law. Costs of issuance also are capital ezpenditures for this purpose. Certain other eapeuditures also qualify for reimbursemens. Ihe Regulations do not apply to and this form is not to be used ia conneccion with use of procerds of obligations to finance expenditures paid on or after the date of issuance of the obliga[ions, and this form generally does nac apply to obligations for the refinancing of ezternal borrowings (taxable or taz-ezempt) sucti as by issuance of renewal notes or refunding bonds. INSTRUCTIONS 'Ihese instructions are based on the Regulazions published in The Federal Resister on June 18, 1993. The instructions refer to the particular lines oa the form of Declaration o ici tent. Line 1. Insert the ezpected mazimum principal amount of obligations exgected to be issued for the projecc wii?respect to whicti the capi[al exgenditures co be reimbursed relate. The amount encered on line 1. should include the maximum principal amaunt of all obligations to be issued for the project, (i.e., obligations to be issued for reimbursemeat of prior ezpendicures and obligazions to finaace eagenditures to be paid oa or after the date of issuance of the obligations). A'project inc3udes any progerry, project, or program (e.g., highway capital improvement program, hospital equipment acquisition, or school buflding renovation). Line 2. The general description of the capital ezpenditures to be reimbursed may be set for[h in one of two ways -= eittLer (A) by a functional descripcion of the properry, project or program for wtuch the ezpendirure is made - Examples- "highway capital improvemen[ program": "streec and bridge improvements"; "hospital ' equipmenc acquisuion"; "sc3iool buildings renovation"; or (B) by idenrification of che fund or account from wlueh the money will be advanced to pay che ezpeaditures [Tac will be reimbursed subsequencly from borrowed money, and a statement of the general functianal purpose of that fund or account -- Eaample- "paz3cs and recreation fund, the general functional purpose of which fund or accouat is recreacional iacilirv iaDC?cal imnrovement proeram". The (B) opcion, eoaeerning idencification and description of the fund can be used where che fund purpose, in effecz, describes the generic purpose of the project, pmperty or program, such as a waterworks improvement for which money is advanced from the water uuliry fund. If the money is to be advanced from a general purpose fund such as the general fund or a capital improvements fuad which is available for any rype of capital improvement, use option (A) by scating che generic function of the pmject, propercy or improvement. 501(c) Oreanizations. If the reimbunemenc obligations will constitute qualified 501(c)(3) bonds, the praceeds ot whic wil e loaned to a 501(c)(3) organization, the 501(c)(3) organ.izacion, can make the Declazacion wich respect to its expeaditures and its name can be inserted on the "Name of Issuer" line, and iu oificer can sign the Declaration. Accordingly, in these Instructions, "Issuer" means the issuer of the reimbursemenc bonds, ezcept thaz in che case of a"loan" of proceeds of che bonds to a 501(c)(3) organization for which che 501(c)(3) organizacion has elecced to make che Declaracion, "Issuer' means che 501(c)(3) organizacion.