HomeMy WebLinkAbout2023-13 - Declaring Its Intention to Reimburse Project Costs from the Proceeds of the Issuance of Bonds for Assessment District No. 120-2 and Assessment District No. 124RESOLUTION NO. 2023-13
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH, CALIFORNIA, DECLARING ITS
INTENTION TO REIMBURSE PROJECT COSTS FROM
THE PROCEEDS OF THE ISSUANCE OF BONDS FOR
ASSESSMENT DISTRICT NO. 120-2 AND ASSESSMENT
DISTRICT NO. 124
WHEREAS, proceedings were previously undertaken under the provisions of the
Municipal Improvement Act of 1913, Division 12 of the California Streets and Highways
Code (the "Act"), to form the City of Newport Beach Assessment District No. 120-2 ("AD
120-2"), and the City of Newport Beach Assessment District No. 124 ("AD 124");
WHEREAS, AD 120-2 was formed on January 11, 2022, and AD 124 was formed
on July 27, 2021 (collectively, the "Assessment Districts");
WHEREAS, the purpose of the Assessment Districts is to fund the
undergrounding of certain existing overhead utilities located within each of the
Assessment Districts;
WHEREAS, the City Council of the City of Newport Beach (the "Issuer") desires
to finance the costs of acquiring certain public facilities and improvements, as provided in
Exhibit A, Description of Project, which is attached hereto and incorporated herein by this
reference (the "Project"), relating to the undergrounding of the utilities within Assessment
Districts;
WHEREAS, the Issuer intends to finance the acquisition of the Project or portions
of the Project with the proceeds of the sale of obligations the interest upon which is
excluded from gross income for federal income tax purposes (the "Obligations"); and
WHEREAS, prior to the issuance of the Obligations, the Issuer desires to incur
certain expenditures in furtherance of the Project, to be advanced by Issuer, which
expenditures are desired to be reimbursed by the Issuer from a portion of the proceeds
of the sale of the Obligations.
NOW, THEREFORE, the City Council of the City of Newport Beach resolves as
follows:
Resolution No. 2023-13
Page 2 of 4
Section 1: The Issuer hereby states its intention, and reasonably expects, to
reimburse Project costs incurred prior to the issuance of the Obligations with proceeds of
the Obligations. Exhibit A, Description of Project, generally describes the Project
expenses that will be advanced by the Issuer and reimbursed from a portion of the
proceeds of the forthcoming sale of the Obligations.
Section 2: The reasonably expected maximum principal amount of the
Obligations is $2,620,250 with respect to the portion of the Project relating to AD 120-2,
and $32,815,700 with respect to the portion of the Project relating to AD 124.
Section 3: This resolution is adopted on, or prior to, the date that the Issuer will
expend monies for the portion of the Project costs to be reimbursed from proceeds of the
Obligations (the "Expenditure Date").
Section 4: Except as described below, the expected date of issue of the
Obligations will be within eighteen months of the later of the Expenditure Date and the
date the Project is placed in service; provided, that the reimbursement may not be made
more than three years after the original expenditure is paid. For Obligations subject to
the small issuer exception of Section 148(f)(4)(D) of the Internal Revenue Code, the
"eighteen -month limit" of the previous sentence is changed to "three years" and the
limitation of the previous sentence beginning with "; provided, ...." is not applicable.
Section 5: Proceeds of the Obligations to be used to reimburse for Project costs
are not expected to be used, within one year of reimbursement, directly or indirectly to
pay debt service with respect to any obligation (other than to pay current debt service
coming due within the next succeeding one year period on any tax exempt obligation of
the Issuer (other than the Obligations) or to be held as a reasonably required reserve or
replacement fund with respect to an obligation of the Issuer or any entity related in any
manner to the Issuer, or to reimburse any expenditure that was originally paid with the
proceeds of any obligation, or to replace funds that are or will be used in such manner.
Section 6: This resolution is consistent with the budgetary and financial
circumstances of the Issuer, as of the date hereof. No monies from sources other than
the Obligation issue are, or are reasonably expected to be reserved, allocated on a
long-term basis, or otherwise set aside by the Issuer (or any related party) pursuant to
their budget or financial policies with respect to the Project costs. To the best of its
knowledge, this City Council is not aware of the previous adoption of official intents by the
Issuer that have been made as a matter of course for the purpose of reimbursing
expenditures and for which tax exempt obligations have not been issued.
Resolution No. 2023-13
Page 3 of 4
Section 7: The limitations described in Section 3 and Section 4 do not apply to
(a) costs of issuance of the Obligations, (b) an amount not in excess of the lesser of
$100,000 or five percent (5%) of the proceeds of the Obligations, or (c) any preliminary
expenditures, such as architectural, engineering, surveying, soil testing, and similar costs
other than land acquisition, site preparation, and similar costs incident to commencement
of construction, not in excess of twenty percent (20%) of the aggregate issue price of the
Obligations that finances the Project for which the preliminary expenditures were incurred.
Section 8: This resolution is adopted as official action of the Issuer to comply
with Treasury Regulation § 1.150-2 and any other regulations of the Internal Revenue
Service relating to the qualification for reimbursement of Issuer expenditures incurred
prior to the date of issue of the Obligations, is part of the Issuer's official proceedings, and
will be available for inspection by the general public at the main administrative office of
the Issuer.
Section 9: The recitals provided in this resolution are true and correct and are
incorporated into the operative part of this resolution.
Section 10: If any section, subsection, sentence, clause or phrase of this
resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not
affect the validity or constitutionality of the remaining portions of this resolution. The City
Council hereby declares that it would have passed this resolution, and each section,
subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or
more sections, subsections, sentences, clauses or phrases be declared invalid or
unconstitutional.
Section 11: The City Council finds the adoption of this resolution is exempt from
environmental review under the California Environmental Quality Act ("CEQA") pursuant
to Section 15302(d) (conversion of overhead electric utility distribution system facilities to
underground including connection to existing overhead electric utility distribution lines
where the surface is restored to the condition existing prior to the undergrounding) of the
CEQA Guidelines, California Code of Regulations, Title 14, Division 6, Chapter 3,
because it has no potential to have a significant effect on the environment.
Resolution No. 2023-13
Page 4 of 4
Section 12: This resolution shall take effect immediately upon its adoption by the
City Council, and the City Clerk shall certify the vote adopting the resolution.
ADOPTED this 14t" day of February, 2023.
ATTEST:
L�:zww%�Z'Ji
brown
City Clerk
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
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Aaron C. Harp
City Attorney
Attachment(s): Exhibit A - Description of Project
EXHIBIT A
DESCRIPTION OF PROJECT
ASSESSMENT DISTRICT NO. 120-2
The conversion of certain overhead electrical, cable and communication facilities to
underground locations located within and around AD 120-2, together with appurtenant
work.
ASSESSMENT DISTRICT NO. 124
The conversion of certain overhead electrical, cable and communication facilities to
underground locations located within and around AD 124, together with appurtenant work
STATE OF CALIFORNIA }
COUNTY OF ORANGE } ss.
CITY OF NEWPORT BEACH }
I, Leilani I. Brown, City Clerk of the City of Newport Beach, California, do hereby certify that the
whole number of members of the City Council is seven; the foregoing resolution, being Resolution
No. 2023-13 was duly introduced before and adopted by the City Council of said City at a regular meeting
of said Council held on the 141h day of February, 2023; and the same was so passed and adopted by the
following vote, to wit:
AYES: Mayor Pro Tern Will O'Neill, Council Member Brad Avery, Council Member Robyn
Grant, Council Member Lauren Kleiman, Council Member Joe Stapleton, Council
Member Erik Weigand
NAYS: None
RECUSED: Mayor Noah Blom
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the official seal of
said City this 151h day of February, 2023.
Dak, j -
Leilani I. Brown
City Clerk
Newport Beach, California