IV.7. Approve Resolution 2018-021 Declaring the Official Intent of the City of Hopkins to Reimburse Certain Expenditures from the Proceeds of Bonds to be Issued by the CityFebruary 20, 2018 Council Report 2018- 032
APPROVE RESOLUTION 2018-021
DECLARING THE OFFICIAL INTENT OF THE CITY
OF HOPKINS TO REIMBURSE CERTAIN
EXPENDITURES FROM THE PROCEEDS OF
BONDS TO BE ISSUED BY THE CITY
Proposed Action.
Staff recommends adoption of the following motion: Move that Council adopt Resolution 2018-
021 Declaring the Official Intent of the City to Reimburse Certain Expenditures from the
Proceeds of Bonds to be Issued by the City regarding Blake Road Upgrades, City project 2013-
06.
Overview:
The City will reconstruct Blake Road from south of Excelsior Boulevard to State Trunk Highway
7. The project is planned to be completed over a 2-year span. Funding sources for the project
are Hennepin County, Municipal State Aid and the City of Hopkins. The City intends to issue
bonds for their share of the project, $8,000,000 split between 2018 and 2019. Due to the timing
of the project and multiple bond issuances the City will incur some costs before bonds are issued.
Approving this resolution will allow any capital expenditures that are incurred before bond
issuance to be reimbursed from the bond proceeds and comply with I.R.S. regulations.
Supporting Information:
• Resolution 2018-021
________________________________________
Nick Bishop
Finance Director
CITY OF HOPKINS
HENNEPIN COUNTY, MINNESOTA
RESOLUTION 2018-021
DECLARING THE OFFICIAL INTENT OF THE CITY OF
HOPKINS TO REIMBURSE CERTAIN EXPENDITURES FROM THE
PROCEEDS OF BONDS TO BE ISSUED BY THE CITY
WHEREAS, the Internal Revenue Service has issued Treas. Reg. § 1.150-02 (the
“Reimbursement Regulations”) 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 City of Hopkins, Minnesota (the “City”) expects to incur certain expenditures
that may be financed temporarily from sources other than bonds, and reimbursed from the
proceeds of a tax-exempt bond;
WHEREAS, the City has determined to make this declaration of official intent (“Declaration”)
to reimburse certain costs from proceeds of bonds in accordance with the Reimbursement
Regulations.
NOW THEREFORE BE IT RESOLVED, that the City Council of the City of Hopkins hereby
1. The City intends to incur expenditures for the project described in Council Report 2018-
026, Blake Road Improvements (the “Project”)
2. The City reasonably expects to reimburse the expenditures made for certain costs of the
Project from the proceeds of the bonds. All reimbursed expenditures will be capital
expenditures, costs of issuance of the bonds, or other expenditures eligible for
reimbursement under Section 1.150-2(d)(3) of the Reimbursement Regulation.
3. This Declaration has been made not later than 60 days after payment of any original
expenditure to be subject to a reimbursement allocation with respect to the proceeds of
bonds, except for the following expenditures: (a) costs of issuance of bonds; (b) costs in
an amount not in excess of $100,000 or 5 percent of the aggregate issue price of the issue
or issues that finance or are reasonably expected by the City to finance the project for
which the preliminary expenditures were incurred. The term “preliminary expenditures”
includes architectural engineering, surveying, bond issuance costs and, and similar costs
that are incurred prior to commencement of acquisition, construction or rehabilitation of a
project, other than land acquisition, site preparation and similar costs incident to
commencement of construction.
4. This declaration is an expression of the reasonable expectations of the City based on the
facts and circumstances known to the City as of the date hereof. The anticipated original
expenditures for the Project are consistent with the City’s budgetary and financial
circumstances.
5. This Declaration is intended to constitute a declaration of official intent for the purposes
of the Reimbursement Regulations.
Adopted by the City Council of the City of Hopkins this 20th day of February, 2018.
By:___________________________
Molly Cummings, Mayor
ATTEST:
_______________________________
Amy Domeier, City Clerk