R-06-10-12-11B1 - 10/12/2006RESOLUTION NO. R -06-10-12-11B 1
WHEREAS, the City of Round Rock, Texas (the "Issuer") is a home -
rule City of the State of Texas, and
WHEREAS, the Issuer expects to pay expenditures in connection
with acquiring certain vehicles and equipment (the "Property") prior to
the issuance of obligations to finance the Property, and
WHEREAS, the Issuer finds, considers, and declares that the
reimbursement of the Issuer for the payment of such expenditures will
be appropriate and consistent with the lawful objectives of the Issuer
and, as such, chooses to declare its intention, in accordance with the
provisions of Section 1.150-2 of the Treasury Regulations, to reimburse
itself for such payments at such time as it issues obligations to
finance the Property, Now Therefore
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS,
I.
That the Issuer reasonably expects to incur debt, as one or more
separate series of various types of obligations, with an aggregate
maximum principal amount equal to $750,000 for the purpose of paying
the costs of the Property.
II.
That all costs to be reimbursed pursuant hereto will be capital
expenditures. No tax-exempt obligations will be issued by the Issuer in
furtherance of this Resolution after a date which is later than 18
months after the later of (1) the date the expenditures are paid or (2)
the date on which the property, with respect to which such expenditures
were made, is placed in service.
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III.
The foregoing notwithstanding, no tax-exempt obligation will be
issued pursuant to this Resolution more than three years after the date
any expenditure which is to be reimbursed is paid.
IV.
The City Council hereby finds and declares that written notice of
the date, hour, place and subject of the meeting at which this
Resolution was adopted was posted and that such meeting was open to the
public as required by law at all times during which this Resolution and
the subject matter hereof were discussed, considered and formally acted
upon, all as required by the Open Meetings Act, Chapter 551, Texas
Government Code, as amended.
RESOLVED this 12th day of October, 2006.
CHRISTINE R. MARTINEZ, City Se
WEL , Mayor
City of Round Rock, Texas
etary
2.
Eligible Capital Lease Items
Fiscal Year 2006-2007
Department
Description Budgeted Cost
Building Inspections Pickup Trucks (2)
Police
Police
PARD
PARD
Street
Marked Vehicles (17)
Unmarked Vehicles (5)
Cargo van
Pickup Truck
Bucket Truck
$
29,000
592,161
157,160
18,000
16,249
105,000
$ 917,570
DATE: October 5, 2006
SUBJECT: City Council Meeting, October 12, 2006
ITEM: *11.6.1. Consider a resolution expressing official intent to reimburse cost of
acquiring certain vehicles and equipment.
Department: Finance
Staff Person: Cindy Demers, Finance Director
Justification:
In accordance with the operating budget, certain equipment is acquired with cash and
subsequently financed for three years through a tax-exempt leasing arrangement. Because
of the tax-exempt nature of the financing, Internal Revenue Service regulations require the
City to state its intentions before the transactions are completed. This type of financing
allows the City to acquire new equipment and replace equipment and rolling stock in a
timely manner as replacement criteria are met. For the current fiscal year, the equipment
to be financed is scheduled at $750,000.
Funding:
Cost: $750,000
Source of funds: Payment of principal and interest for the three-year amortization of
this obligation is funded from the debt service portion of the property
tax.
Outside Resources: N/A.
Background Information:
With a three-year payback, the impact on any one operating budget is minimized.
Additionally, the tax-exempt lease rates offer a very favorable cost of capital to the City.
This program permits scheduled replacement of worn equipment on a revolving basis.
Public Comment: N/A