Consent 1.J.
Regular City Council Meeting
- Meeting Date:
- 01/27/2020
- TITLE
- Resolution Establishing Compliance with Reimbursement under Internal Revenue Code for Airport Construction Projects
- PRESENTED BY:
- Andy Zoeller
- Department:
- Finance
Presentation:
No
PROBLEM/ISSUE STATEMENT
The City will be selling bonds to finance portions of the construction projects at the airport. The City needs to expend monies related to the projects before funds are available from the bond sale proceeds. Under IRS rules, the attached resolution must be adopted in order for the City to reimburse those pre-sale expenses from the bond sale proceeds.
The expansion is divided into 5 phases lasting approximately 4 years. The City plans to issue bonds in Spring of 2020 to pay for the work.
ALTERNATIVES ANALYZED
The City Council may:
- Approve the resolution and proceed with the projects with the ability to reimburse expenses when the bonds are sold; or
- Not approve the resolution, in which case the City will have to suspend certain areas of work until bonds sell or will have to find alternative ways to pay for the expenses incurred prior to the bond sale.
FINANCIAL IMPACT
This Resolution will not result in additional costs to the projects.
RECOMMENDATION
Staff recommends that the City Council approve the attached resolution that will allow the City to reimburse expenses related to projects at the airport that it will incur prior to issuing bonds for the project.