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HomeMy WebLinkAboutRes 441 and FA-33 Fred Waring Drive Widening - Bonds Proceeds Reimbursement Resolution No. 441 Resolution No. FA-33 PALM DESERT REDEVELOPMENT AGENCY/PALM DESERT FINANCING AUTHORITY STAFF REPORT REQUEST: APPROVAL OF A RESOLUTION OF THE PALM DESERT REDEVELOPMENT AGENCY DECLARING ITS INTENT TO REIMBURSE EXPENDITURES IN CONNECTION WITH THE WIDENING OF FRED WARING DRIVE FROM THE PROCEEDS OF BONDS APPROVAL OF A RESOLUTION OF THE PALM DESERT REDEVELOPMENT FINANCING AUTHORITY DECLARING ITS INTENT TO REIMBURSE EXPENDITURES IN CONNECTION WITH THE WIDENING OF FRED WARING DRIVE FROM THE PROCEEDS OF BONDS SUBMITTED BY: DENNIS M. COLEMAN, REDEVELOPMENT FINANCE MANAGER DATE: APRIL 11, 2002 CONTENTS: PALM DESERT REDEVELOPMENT AGENCY RESOLUTION NO. 441 PALM DESERT FINANCING AUTHORITY RESOLUTION FA- 33 Recommendation: By Minute Motion: 1. That the Palm Desert Redevelopment Agency approves Resolution No. 441 , declaring its intent to reimburse expenditures in connection with the widening of Fred Waring Drive from the proceeds of bonds. 2. That the Palm Desert Financing Authority approve Resolution FA-33 , declaring its intent to reimburse expenditures in connection with the widening of Fred Waring Drive from the proceeds of bonds. Executive Summary: The attached resolutions of the Redevelopment Agency and the Financing Authority will allow the Agency to reimburse any expenditures for the widening of Fred Waring Drive with future bond proceeds. AVeisnt--Ci BY RDA ON L{ VERIFIED BY )Ca n"\ G IRDA\Dennis Coleman\DA TA1WPIREPORTSIpola.pdra.resololinent.lw.wpd Original on file with City Clerk's Office Resolution No. 441 Resolution No. FA-33 Staff Report Approval of Agency and Financing Authority Resolutions for Reimbursement of Fred Waring Drive Widening Expenditures from Bond Proceeds Page 2 April 11, 2002 Discussion: There is a possibility that the Agency may need to use tax increment for expenditures associated with the widening of Fred Waring Drive. This may happen due to prolonged negotiations with the Western Center and/or the Agency meeting its requirements of the Amended Stipulation with the Western Center. Staff is recommending that the Financing Authority and the Redevelopment Agency approve their respective resolutions which will allow any funds spent to be able to be reimbursed by future bond proceeds.The adoption of these resolutions will allow the funds being reimbursed to retain the same flexibility as the original funds being spent. This will allow these reimbursed funds to be used in the same manner as tax increment can be used, especially for any private uses. Staff is therefor recommending that the Financing Authority and the Agency Board adopt their respective resolutions. Submitted by: Department Head: Dennis M. Coleman ave Yrigo Redevelopment Finance Manager Director of edevelopment DMC:mh Approval: Justi Carthy, ACM-Redev pment Carlos L. Orte , Executive Director/ Chief Administrative Officer G:IRDA\Dennis Coleman\DATAIWPIREPORTS\pdfa.pdra.resolofinent.(w.wpd RESOLUTION NO. 441 A RESOLUTION OF THE PALM DESERT REDEVELOPMENT AGENCY DECLARING ITS INTENT TO REIMBURSE EXPENDITURES IN CONNECTION WITH THE WIDENING OF FRED WARING DRIVE FROM THE PROCEEDS OF BONDS THE PALM DESERT REDEVELOPMENT AGENCY HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS: Section 1. The Palm Desert Redevelopment Agency intends to spend redevelopment funds to reimburse the City of Palm Desert for land acquisition and other capital costs associated with the widening of Fred Waring Drive. Section 2. The Agency intends that the foregoing described expenditures be 9 Y 9 9 P reimbursed to the Agency from the proceeds of bonds or other obligations to be issued by the Agency, by the Palm Desert Financing Authority, or by a related public entity. The Agency expects that all such expenditures will be reimbursed with the proceeds of such bonds. Section 3. Section 1.150-2 of the Treasury Regulations governs the allocation of expenditures of a reimbursement bond. A reimbursement bond is that portion of an issue of bonds (or other obligations) allocated to reimburse an original expenditure (i.e., an expenditure for a governmental purpose that is originally paid from a source other than a reimbursement bond)that was paid before the date of issue of the bonds. Section 1.150-2 provides rules to determine when an allocation of proceeds of bonds to reimburse an original expenditure will be treated as an expenditure of those proceeds. Section 4. In order for such an allocation of those proceeds to be treated as an expenditure, the issuer (or in certain cases, a conduit borrower) of the bonds must, in accordance with Section 1.150-2, adopt an official intent for the original expenditure. The official intent is a declaration of intention by the issuer to reimburse the original expenditure with proceeds of bonds. Such official intent is declared in Section 2 hereof. Section 5. The maximum principal amount of bonds or obligations expected to be issued for the above-described costs associated with the widening of Fred Waring Drive is $7,000,000. P6402\0001\687594.2 RESOLUTION NO. 441 Section 6. This official intent is not declared as a matter of course and is not declared in an amount substantially in excess of the amounts expected to be necessary to reimburse the expenditures described in Section 3 hereof. PASSED, APPROVED and ADOPTED this 11th day of April, 2002. AYES: NOES: ABSENTS: ABSTAINS: Richard S. Kelly, Chairman Attest: Sheila R. Gilligan, Secretary P6402\0001\687594.2 -2- RESOLUTION NO. FA- 33 A RESOLUTION OF THE PALM DESERT FINANCING AUTHORITY DECLARING ITS INTENT TO REIMBURSE EXPENDITURES IN CONNECTION WITH THE WIDENING OF FRED WARING DRIVE FROM THE PROCEEDS OF BONDS THE PALM DESERT FINANCING AUTHORITY HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS: Section 1. The Palm Desert Redevelopment Agency intends to spend redevelopment funds to reimburse the City of Palm Desert for land acquisition and other capital costs associated with the widening of Fred Waring Drive. Section 2. The Agency intends that the foregoing described expenditures be reimbursed to the Agency from the proceeds of bonds or other obligations to be issued by the Financing Authority, by the Agency, or by a related public entity. The Financing Authority and the Agency expect that all such expenditures will be reimbursed with the proceeds of such bonds. Section 3. Section 1.150-2 of the Treasury Regulations governs the allocation of expenditures of a reimbursement bond. A reimbursement bond is that portion of an issue of bonds (or other obligations) allocated to reimburse an original expenditure (i.e., an expenditure for a governmental purpose that is originally paid from a source other than a reimbursement bond)that was paid before the date of issue of the bonds. Section 1.150-2 provides rules to determine when an allocation of proceeds of bonds to reimburse an original expenditure will be treated as an expenditure of those proceeds. Section 4. In order for such an allocation of those proceeds to be treated as an expenditure, the issuer (or in certain cases, a conduit borrower) of the bonds must, in accordance with Section 1.150-2, adopt an official intent for the original expenditure. The official intent is a declaration of intention by the issuer to reimburse the original expenditure with proceeds of bonds. Such official intent is declared in Section 2 hereof. Section 5. The maximum principal amount of bonds or obligations expected to be issued for the above-described costs associated with the widening of Fred Waring Drive is $7,000,000. P6402\0001\687809.1 RESOLUTION FA-33 Section 6. This official intent is not declared as a matter of course and is not declared in an amount substantially in excess of the amounts expected to be necessary to reimburse the expenditures described in Section 3 hereof. PASSED, APPROVED and ADOPTED this 11th day of April, 2002. AYES: NOES: ABSENTS: ABSTAINS: Richard S. Kelly, President Attest: Sheila R. Gilligan, Secretary P6402\0001\687809.1 -2-