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CITY OF COLTON <br />AGENDA REPORT <br />FOR COUNCIL MEETING OF APRIL 18, 2000 <br />TO: HONORABLE MAYOR PRO TEMPORE & CITY COUNCIL MEMBERS <br />APPROVAL: HENRY T. GARCIA, CITY MANAG <br />FROM: AL HOLLIMAN, FINANCE DI <br />SUBJECT: RESOLUTION AUTHORIZING THE CITY'S WASTEWATER <br />TREATMENT FUND TO BE REIMBURSED FROM BOND PROCEEDS <br />FOR EXPENDITURES MADE PRIOR TO THE ISSUANCE OF BONDS <br />DATE: APRIL 10, 2000 <br />BACKGROUND <br />On March 21, 2000 the City Council approved an emergency change order to Americon <br />Constructors for a capacity increase at the Wastewater Treatment Facility. In addition, <br />the City Council directed staff to begin work on a revenue bond issue to fund the cost of <br />the necessary improvements, estimated at $3.5 million. <br />DISCUSSION/ANALYSIS <br />Under the Internal Revenue Code, certain expenses for a qualified capital improvement <br />project made prior to the issuance of tax-exempt bonds can be reimbursed from the <br />proceeds when bonds are issued. A "reimbursement resolution" approved by the City <br />Council is required to enable such reimbursement from the tax-exempt proceeds. <br />Approval of this resolution allows the Wastewater Treatment Fund to replenish that <br />portion of its operating funds which has temporarily been expended for purposes of the <br />wastewater capital project. <br />FINANCIAL IMPACT <br />There is no precise budgetary impact as a result of approving this resolution. However, <br />passage of this resolution enables the replenishment of operating cash in the <br />wastewater treatment fund. <br />ENVIRONMENTAL IMPACT <br />None. <br />RECOMMENDATION <br />Staff recommends approval of the attached resolution authorizing the City's <br />Wastewater Treatment Fund to be reimbursed from bond proceeds for qualified <br />expenditures made prior to the issuance of bonds. <br />Item #5 <br />