2003R25- PRIOR LAWFUL EXPENDITURE OF FUNDS
RESOlUTION NO. 03 -/r25
A RESOLUTION RELATING TO ESTABLISHING THE CITY'S INTENTION
TO REIMBURSE ITSELF FOR THE PRIOR LAWFUL EXPENDITURE OF
FUNDS FROM THE PROCEEDS OF OBLIGATIONS TO BE ISSUED BY
THE CITY FOR AUTHORIZED PURPOSES; AUTHORIZING MATTERS
INCIDENT AND RELATED THERETO; AND PROVIDING AN EFFECTNE
DATE
WHEREAS, the City Council (the Governing Body) of the City of Schertz, Texas (the
Issuer) has entered into or will enter into various contracts pertaining to the expenditure of
lawfully available funds of the Issuer to finance the costs associated with (i) acquiring,
purchasing, constructing, improving, renovating, enlarging, or equipping the City's municipal
drainage system relating and adjacent to Maske Road (the Construction Costs); (ii) the payment
of various engineering costs, including design testing, design engineering, and construction
inspection related to the Construction Costs (the Engineering Costs), (iii) the payment of various
architectural costs, including preparation of plans and specifications and various other plans and
drawings related to the Construction Costs (the Architectural Costs), and (iv) the payment of
various administrative costs, including the fees of bond counsel, financial advisor, other
professionals, and bond printer (the Administrative Costs) [the Construction Costs, Engineering
Costs, the Architectural Costs, and Administrative Costs collectively constitute costs of the
project (the Project)]; and
WHEREAS, Section 1201.042, as amended, Texas Government Code provides that the
proceeds from the sale of obligations issued to finance the acquisition, construction, equipping,
or furnishing of any project or facilities, such as the Project, may be used to reimburse the Issuer,
for costs attributable to such project or facilities paid or incurred before the date of issuance of
such obligations; and
WHEREAS, the United States Department of Treasury (the Department) issued
Regulation Section 1.150-2 (the Regulations) which establishes when the proceeds of obligations
are spent and therefore are no longer subject to various federal income tax restrictions contained
in the Internal Revenue Code of1986, as amended (the Code); and
WHEREAS, the Issuer intends to reimburse itself, within eighteen months from the later
of the date of expenditure or the date the property financed is placed in service (but in n9 event
more than three years after the original expenditures is paid), for the prior lawful capital
expenditure of funds from the proceeds of one or more series of tax-exempt obligations (the
Obligations) that the Issuer currently contemplates issuing in an approximate amount of
$450,000 to finance a portion ofthe costs ofthe Project; and
WHEREAS, under the Regulations, to fund such reimbursement with proceeds of the
Obligations, the Issuer must declare its expectation ultimately to make such reimbursement
before making the expenditures; and
WHEREAS, the Issuer hereby finds and detennines that the reimbursement for the priorsexpenditure of funds of the Issuer is not inconsistent with the Issuer's budgetary and financial
circumstances; and
20080301.1
WHEREAS, the Governing Body hereby finds and determines that the adoption of this
Resolution is in the best interests ofthe citizens ofthe Issuer; now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS
THAT:
SECTION I: This Resolution is a declaration of intent to establish the Issuer's
reasonable, official intent under section 1.150-2 of the Regulations to reimburse itself from
certain of the proceeds of the Obligations for any capital expenditures previously incurred (not
more than 60 days prior to the date hereof) with respect to the Project from the Issuer's General
Fund.
SECTION 2: The Issuer intends to issue the Obligations and allocate within 30 days
after the date of issue of the Obligations the proceeds therefrom to reimburse the Issuer for prior
lawful expenditures with respect to the Project in a manner to comply with the Regulations.
SECTION 3: The reimbursement expenditure will be a type properly chargeable to a
capital account (or would be so chargeable with a proper election) under general Federal income
tax principles.
SECTION 4: The Issuer intends to otherwise comply with all the requirements
contained in the Regulations.
SECTION 5: This Resolution may be relied upon by the appropriate officials at the
Office of the Attorney General for the State of Texas and establishes compliance by the Issuer
with the requirements of Texas law and the Regulations.
SECTION 6: With respect to the proceeds of the Obligations allocated to reimburse the
Issuer for prior expenditures, the Issuer shall not employ an abusive device under Treasury
Regulation Section 1.148-10, including using within one year of the reimbursement allocation,
the funds corresponding to the proceeds of the Obligations in a manner that results in the creation
of replacement proceeds, as defined in Treasury Regulation Section 1.148-1, of the Obligations
or another issuer of tax-exempt obligations.
SECTION 7: The recitals contained in the preamble hereof are hereby found to be true,
and such recitals are hereby made a part of this Resolution for all purposes and are adopted as a
part of the judgment and findings ofthe Governing Body.
SECTION 8: All orders and resolutions, or parts thereof, which are in conflict or
inconsistent with any provision of this Resolution are hereby repealed to the extent of such
conflict, and the provisions of this Resolution shall be and remain controlling as to the matters
resolved herein.
SECTION 9: This Resolution shall be construed and enforced in accordance with the
laws ofthe State of Texas and the United States of America.
SECTION 10: If any provision of this Resolution or the application thereof to any person
or circumstance shall be held to be invalid, the remainder of this Resolution and the application
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20080301.1
of such provision to other persons and circumstances shall nevertheless be valid, and the
Governing Body hereby declares that this Resolution would have been enacted without such
invalid provision.
SECTION II: It is officially found, determined, and declared that the meeting at which
this Resolution is adopted was open to the public and public notice of the time, place, and subject
matter of the public business to be considered at such meeting, including this Resolution, was
given, all as required by Chapter 551, as amended, Texas Government Code.
SECTION 12: This Resolution shall be in force and effect from and after its final
passage, and it is so resolved.
[The remainder of this page intentionally left blank)
20080301.1
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PASSED, ADOPTED AND APPROVED on this the /O-tday of December, 2003.
CITY OF SCHERTZ, TEXAS
ATTEST:
~ ~/UI4J~
Mayor ;
~~~~)
(CITY SEAL)
-4-
20080301.1
FULBRIGHT & ~AWORSKI L.L.P.
A REGISTERED LIMITED LIABILITY PARTNERSHIP
300 CONVENT STREET, SUITE 2200
SAN ANTONIO, TEXAS 78205-3792
WWW.FULBRIGHT.COM
MICHAEL L. SPAIN
PARTNER
MSPAI N@FULBRIGHT.COM
DIRECT DIAL:
TELEPHONE:
FACSIMILE:
(210) 270-7184
(210) 224-5575
(210) 270-7205
November 26, 2003
Mr. Mark Marquez
City Manager
1400 Schertz Parkway
Schertz, Texas 78154
Re: Reimbursement resolution relating to Maske Road Drainage Improvements
Dear Mark:
I enclose a reimbursement resolution for the Maske Road drainage improvements that we
discussed last Friday. The resolution provides for an eventual reimbursement to the City in the
approximate amount of $450,000. The enclosed resolution is in the same form as the Municipal
Complex reimbursement resolution that you received in October.
Very
MLS/sd
Enclosures
cc: with enclosures:
Mr. Mark McLiney
Southwest Securities
711 Navarro, Suite 490
San Antonio, Texas 78205
W. Jeffrey Kuhn (firm)
Lisa Adelman (firm)
Connie Lock (firm)
20080360.1
HOUSTON. NEW YORK. WASHINGTON DC. AUSTIN. DALLAS. Los ANGELES. MINNEAPOLIS. SAN ANTONIO. HONG KONG. LONCON . MUNICH
November 19,2003
To: Mark Marquez, City Manager
From: John E. Bierschwale, Asst. City Mana
Re: West Deitz Creek at Maske Road Drainag
Based upon our previous discussions regarding the West Dietz Creek drainage flooding
problems into the Windy Meadows Subdivision and Oak St, I have spoken to Larry
Akins knowing he needs additional fill material for the Paul Silber tract to raise the
ground elevation for proper drainage.
He has agreed to accept all the dirt from the West Dietz Creek Drainage channel at
Maske Rd. low water crossing for his development. This would be a cost savings to the
City of Schertz in the amount of approximately $700,000. It is of the utmost importance
we consider this project at the highest priority to complete the drainage/flooding
problems at Windy Meadows Sub. and residents along lower Oak St.
My proposal is to reconstruct the existing low water crossing installing 5 - 7 sixty-inch
drainage pipes, adjust CCMA sewer and reuse lines and purchase 9.945 acres from the
Estate of Betty Boggess.
Summary of Cost
9.945 acres
5 - 60" drainage pipes
Utility relocates
Gas pipeline adjustment
Concrete Rip-Rap
Sub-total
Engineering and Design
Total Project Est.
$81,000
$30,000
$160,000
$50,000
$40.000
$361,000
$54.150
$415,150
I am recommending funding of this project as quickly as possible to meet the time line of
Larry Akins' project. He wishes to begin construction on his project once the platting
process and purchase from the city is complete. Without Mr. Akins assistance with this
project it would cost at least $1,180,000 to complete such a task.
Please advise the direction you wish to seek.
"
88/19/28133 15:22
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PAGE 131/131
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