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CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE I, the undersigrred, being the duly qualified and acting recording officer of the City of Billings, Montana (the City), hereby certifu that the attached resolution is a true copy of Resolution No. 08'18669, entitled: RESOLUTION RELATING TO SPECIAL IMPROVEMENT DISTRICT NO. 1383; DECLARING IT TO BE THE INTENTION OF THE CITY COUNCIL TO CREATE THE DISTRICT FOR THE PURPOSE OF UNDERTAKING CERTAIN LOCAL IMPROVEMENTS AND FINANCING THE COSTS TIIEREOF AND INCIDENTAL THERETO THROUGH TIIE ISSUANCE OF SPECIAL IMPROVEMENT DISTRICT BONDS SECURED BY THE CITY'S SPECIAL IMPROVEMENT DISTRICT REVOLVING FUND (the Resolution" was duly adopted by the City Council of the City at a meeting on January 28, 2008 that the meeting was duly held by the City Council and was attended throughout by a quoÍum, pursuant to call and notice of such meeting given as required by law; and that the Resolution has not as of the date hereof been amended or repealed.) I further certiff that, upon vote being taken on the Resolution at said meeting, the following Councilmembers voted in favor thereof: Ronquillo. Gagrhen, Pitman. Stevens. Veis. Prreoemer McCall Tllledelen and Asfle : voted against the same: or were absent: Clark WITNESS my hand officially this 28b day of January , 2008' ht'-Ynanu'¿ Cari Martin, City Clerk ---PAGE BREAK--- RESOLUTION NO. O8-1 8669 RESOLUTiON RELATING TO SPECIAL IMPROVEMENT DISTRICT NO. 1383; DECLARING IT TO BE THE INTENTION OF THE CITY COLINCIL TO CREATE THE DISTRICT FOR THE PURPOSE OF I]NDERTAKING CERTAIN LOCAL IMPROVEMENTS AND FINANCING THE COSTS THEREOF AND INCIDENTAL THERETO THROUGH THE ISSUANCE OF SPECIAL IMPROVEMENT DISTRICT BONDS SECTIRED BY THE CITY'S SPECIAL IMPROVEMENT DISTzuCT REVOLVING FUND BE IT RESOLVED by the City Council of the City of Billings (the City), Montana, as follows: Section 1. Proposed Improvements¡ Intention To Create District. The Cityproposes to undertake certain local Improvements (the "Improvements") to benefit certain property located in the City. The Improvements consist of the construction of Cherry Hills Road, as more particularly described in Section 5, The total estimated costs of the Improvements are $884,893,10. The costs of the Improvements are to be paid fromthefollowingsources: $180,000 cash contribution from the Cityof Billings; and $371,893.10 of cash contributionbyRon Hill, the owner of 16 of the 28 lots in the Distict, as rnore particularly described in Sections 6 and 9(Ð. It is the intention of this Council to create and establish in the City under Montana Code Annotated, Title 7 , Chapter 12, Parts 4l and 42, as amended, a Special Improvement District (the "District") for the purpose of financing costs of the Improvements and paying costs incidental thereto, including costs associated with the sale and the security of Special lmprovement District bonds drawn on the District (the "Bonds"), the creation and administration of the District, the funding of a deposit to the City's Special Improvement District Revolving Fund (the "Revolving Fund"). The total estimated costs ofthe Improvements, including such incidental costs, to be financed by the Bonds are $3 3 3,000.00. The Bonds are to be payable primarily from special assessments to be levied against property in the District, which property will be specially benefited by the Improvements. Section 2. Number of District. The District, if the same shall be created and established, shall be known and designated as Special Improvement District No. I 3 83 of the City of Billings, Montana, Section 3. Boundaries gf District. The limits and boundaries of the District are depicted on a map attached as Exhibit A hereto (which is hereby incorporated herein and made a part hereofl and more particularly described on Exhibit B hereto (which is hereby incorporated herein and made a part hereof), which boundaries are desigrated and confirmed as the boundaries of the District. A listing of each of the properties in the District is ihown on Exhibit F hereto (which are hereby incorporated herein and made a part hereof¡, Section 4. Benefited Property. The District and tenitory included within the limits and boundaries described in Section ¡ and ái rtto*n on Exhibits A, B, and F are hereby declared to be the Special Improvement District and the territory which will benefit and be benefited by the lmprovements and will be assessed for the costs of the Improvements as described in Section 7. Section 5. General Character of the Improvements. The general character of the lmprovements, as shown in Exhibit E, is the construction of curb and gutter, sanitary sewer mains, sanitary sewer services, water mains, water services, and necessary street improvements fronting Lots on Cherry Hills Road between Annandale Road and just east of Clubhouse Way within Lake Hills Subdivision, Section 6. Ensineer and Estimated Cost, The Engineer will be chosen through aproposal process. The City Engineer's Office has estimated that the costs of the Improvements, including all incidental costs, are $884,893.10. Section 7. Assessment Methods 7.1.@'Allpropertieswithínthedistrictaretobeassessedforthecostsofthe Improvements, as specified herein. The costs of the Improvements shall be assessed against the properly in the District benefiting from the Improvements based on the equal amount methods described in Section 7- 12- 4162,M.C.A., as particularly applied and set forttr in this Section 7. 7.1.1 Equal Amount Method. Assessment #1 will include of cwb and gutter, sanitary sewer mains, sanitary sewer services, water ---PAGE BREAK--- mains, water services, and street improvements to be constructed on Cherry Hills Road, The properties to be assessed forthese improvements include Lake Hills Subdivision 13ù Filing, Block45, I-ots12,13, 14, and l6; Lake Hills Subdivision 14ú Filing, Block 45, Lots 18, 19,20,22, and24; Lake Hills Subdivision 14'Filing, Block 46, Lots 1, 3, and 6. For the purposes of equitably apportioning special benefit to each lot, tract or parcel of land in the District, as above-mentioned, the Engineer has determined that each lot, tract, or parcel of land, receiving street improvements, shall equally bear the costs of the street improvements as set forth in Part III hereto to arrive at an equal cost for the street improvements. The total estimated cost of Assessment #1 is $333,000.00 and shall be assessed against each lot, tract, or parcel of land within the District, as above-mentioned, receiving street improveménts, on an equal amoìrnt basis based on the bid price to be received. The equal amount assessment is estimated to be $27,750.00. The remaining parcels within Assessment #L are owned by Ron Hill, which will be making a cash contribution for their assessment. 7.2. Assessment Methodologies Equitable and Consistent With Benefit. This Council hereby determines that the methods of assessment and the assessment of costs of the specific improvements against the properties benefited thereby as prescribed in this Section 7 are equitable in proportion to and not exceeding the special benefits derived from the respective improvements by the lots, tracts, and parcels to be assessed therefore within the District. Section 8. Pavment of Assessments. The special assessments for the costs ofthe Improvements shall be payable over a term not exceeding 15 years, each in equal semiannual installments of principal, plus interest, or equal semiamual payments of principal and interest, as this Council shall prescribe in the resolution authorizing the issuance of the Bonds. Properly Owners have the right to prepay assessments as provided by law, Fufher, all owners shall have the opportunity to prepay their assessments prior to sale of the SID bonds. Section 9. Method of Financine: Pledee of Revolvine Fund: Findines and Determinations. The City will issue the Bonds in an aggregate principal amount not to exceed $333,000.00 in order to finance the cosis of the lmprovements. Principal of and interest on the Bonds will be paid from special assessments levied against the properties in the District. This Council further finds it is in the public interest, and in the best interest of the City and the District, to secure payment of principal of and interest on the Bonds by the Revolving Fund and hereby authorizes the city to enter into the undertakings and agreements authorized in Section 7-12-4225 in respect of the Bonds. In determining to authorize such undertakings and agreements, this Council has taken into consideration the following factors : Estimated Market Value of Parcels. The estimated market value of the lots, parcels, or tracts in the District as of the date of adoption of this resolution, as estimated, by the County Assessor for property tax purposes ranges from $2,844 to $4,052, and is set forth in Exhibit F. The average market value is $3,455.39 with the median being $3,460, The special assessments to be levied under Section 7 against each lot, patcel, or tract in the District is less than the increase in estimated value of the lot, parcel, or tract as a result of the construction of the Improvements. Diversitv of Propertv Ownershin. There are a total of 28 parcels within the district boundaries, No improvements, public or private, are located on any of the parcels within the District. Sixteen (16) of these parcels are owned by Ron Hill. The remaining 12 parcels are owned by separate owners. Comparison of Speqial Assessments and Propertv Taxes and Market Value. Based on an analysis of the aggregate amount of the proposed, any outstanding special assessments (whether or not delinquent), and any delinquent property taxes (as well as any known industrial development bonds theretofore issued and secured by a mortgage against a parcel in the District) against each lot, parcel, or tract in the District in comparison to the estimated market value of such lot, palcel, or tact after the Improvements, the City concludes that, overall, the estimated market value of the lots, tracts, or parcels ofland in the Diskict exceeds the sum of special assessments, delinquent properfy taxes, and current assessments and is set forth in Exhibit F. Detinquencies. An analysis of the amount of delinquencies in the payment of outstanding special assessments or property taxes levied against the properties in the District shows that of 28 properties, zero properties were delinquent, and is set forth in Exhibit F. ---PAGE BREAK--- The Public Benefit of the lmprovements. The total estimated costs of the lmprovements are $884,893.10. The costs of the Improvements are to be paid from the following sources: $333,000,00 of Special lmprovement District bonds hereinafter described; $ I 80,000.00 cash confibution from the City of Billings; and $371,893.10 of cash conhibution by Ron Hill, the owner of 16 of the 28 lots in the District. All of the properties within the District are zoned Residential 9600. The public improvements contemplated under the terms of this proposed District are required bythe City Subdivision, Site Development and Zoning Ordinances in order for the parcels to develop. Other Factors. As previously noted, Ron Hi11., owner of 16 of the 28 lots in the District will pay a cash contribution of $371,893.10 to the project. Also, the City of Billings is making a cash contribution of $180,000.00. Thetotalcashcontributionisequalto$55l,S93.l0andrepresents62percentoftheconstruction and administrative costs of the Improvements. This condition is necessary to satisfy the City's Special Improvement District Policy regarding raw land subdivision. As shown on Exhibit F, six properties are being assessed for SID 1368 which will be paid off in the year 2027. SID 1368 constructed storm drain improvements serving these properties. Section 10. Rei4rbursement Expenditures 10.01. Bggþfigg. The United States Department of Treasuryhas promulgated final regulations goveming the use of proceeds of tax-exempt bonds, all or a portion of which are to be used to reimburse the City for project expenditures paid by the Cityprior to the date of issuance of such bonds. Those regulations (Treasury Regulations, Section 1 .1 50-2) (the "Regulations") require that the City adopt a statement of official intent to reimburse an original expenditure not later than 60 days after payment ofthe original expenditure. The Regulations also generally require that the bonds be issued and the reimbursement allocation made from the proceeds of the bonds within l8 months (or three years, if the reimbursement bond issue qualifies for the "small issuer" exception from the arbitrage rebate requirement) after the later of the date the expenditure is paid or (ii) the date the project is placed in service or abandoned, but (unless the issue qualifies for the "small issuer" exception from the arbitrage rebate requirement) in no event more than three years after the date the expenditure is paid. The Regulations generally permit reimbursement of capital expenditures and costs of issuance ofthe bonds. 10.02. Prior Expenditures. Other than expenditures to be paid or reimbursed from sources other than the Bonds, (ii) expenditures permitted to be reimbwsed under the transitional provision contained in Section 1.150-2CX2) of the Regulations, (iii) expenditures constituting preliminary expenditures within the meaning of Section 1.150-2(Ð(2) of the Regulations, or (iv) expenditures in a "de minimus" amount (as defined in Section I . I 50-2(Ð( I ) of the Regulations), no e¡penditures for the Improvements have been paid by the City before the date 60 days before the date of adoption of this resolution. costs of the Improvements out of the proceeds of Bonds in an estimated maximum aggregate principal amount of $333,000.00 after the date of payment of all or a portion of the costs of the Improvements. All reimbursed expenditures shall be capital expenditures, a cost ofissuance ofthe Bonds or other expenditures eligible for reimbwsement under Section L150-2(dX3) of the Regulations, 10.04. ÐCgçlgry Matters. As of the date hereof there are no City funds reserved, allocated on a long-term basis or otherwise set aside (or reasonably expected to be reserved, allocated on a long-term basis or otherwise set aside) to provide permanent financing for the expenditures related to the Improvements, other than pursuant to the issuance of the Bonds. The statement of intent contained in this resolution, therefore, is determined to be consistent with the City's budgetary and financial circumstances as they exist or are reasonably foreseeable on the date hereof, 10.05. Reimbursement Allocations, The City's financial officer shall be responsible for making the "reimbursement allocations" described in the Regulations, being generally the transfer of the appropriate amount of proceeds of the Bonds to reimburse the source of temporary financing used by the City to make prior payment of the costs of the Improvements. Each allocation shall be evidence by an entry on the official books and records of the City maintained for the Bonds or the Improvements and shall specifically identify the actual original expenditure being reimbursed. Sectionll. PublicHearineProtests. Atanytimewithinfifteen(15)daysfromandafterthedateof the first publication ofthe notice ofthe passage and approval ofthis resolution, arry owner ofreal properly within the District subject to assessment and taxation for the cost and expense of making the Improvements ---PAGE BREAK--- may make and file with the City Clerk until 5:00 p.m., M.T., on the expiration date of said 15-day period (Februwy 22, 2008), written protest against the proposed lmprovements, or against the extension or creation of the District or both, and this Council will at its next regular meeting after the expiration of the fifteen (15) days in which such protests in writing can be made and filed, proceed to hear all such protests so made and filed; which said, regular meeting will be held on Monday the 25* day of February 2008 , at 6:30 p.m., in the Council Chambers, at 220 North 27* Street, in Billings, Montana. Section 12. Notice of Passase of Resolution of Intention. The City Clerk is hereby authorized and directed to publish or cause to be published a copy ofa notice ofthe passage ofthis resolution in the Billings Times, a newspaper of general circulation in the county on February 7 and February 14, 2008, in the form and manner prescribed by law, and to mail or cause to be mailed a copy of said notice to every person, firm, corporation, or the agent of such person, flrm, or corporation having real property within the District listed in his or her n¿rme upon the last completed assessment roll fo¡ state, county, and school district taxes, at his last-known address, on or before the same day such notice is first published. PASSED AND January 2008. ADOPTED by the City Council of the City of Billings, Montana, this 28* day of CITY OF BILLINGS Attest: Cari Martin, City Clerk Ron Tussing, Mayor