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City of Missoula, Montana Item to be Referred to City Council Committee Committee: Administration & Finance Item: RESOLUTION AMENDING ORDINANCE NO. 1547 AS AMENDED AND SUPPLEMENTED BY CITY RESOLUTIONS NO. 4484, 5247, 5307, 6250, 6359, 6408, 6500, 6589, 6707, 6752, 6831, 7060 AND 7495 TO INCLUDE FEDERAL PAYMENTS AS A GROSS REVENUE OF THE CITY’S SANITARY SEWER SYSTEM; RESTATING THE ORDINANCE AS PREVIOUSLY AMENDED AND SUPPLEMENTED; APPROVING THIS AMENDED AND RESTATED RESOLUTION Date: October 22, 2010 Prepared by: Brentt Ramharter Initiated by: Brentt Ramharter Action Required: Approve the RESOLUTION AMENDING ORDINANCE NO. 1547 AS AMENDED AND SUPPLEMENTED BY CITY RESOLUTIONS NO. 4484, 5247, 5307, 6250, 6359, 6408, 6500, 6589, 6707, 6752, 6831, 7060 AND 7495 TO INCLUDE FEDERAL PAYMENTS AS A GROSS REVENUE OF THE CITY’S SANITARY SEWER SYSTEM; RESTATING THE ORDINANCE AS PREVIOUSLY AMENDED AND SUPPLEMENTED; APPROVING THIS AMENDED AND RESTATED RESOLUTION Recommended Motion: I move the City Council approve the RESOLUTION AMENDING ORDINANCE NO. 1547 AS AMENDED AND SUPPLEMENTED BY CITY RESOLUTIONS NO. 4484, 5247, 5307, 6250, 6359, 6408, 6500, 6589, 6707, 6752, 6831, 7060 AND 7495 TO INCLUDE FEDERAL PAYMENTS AS A GROSS REVENUE OF THE CITY’S SANITARY SEWER SYSTEM; RESTATING THE ORDINANCE AS PREVIOUSLY AMENDED AND SUPPLEMENTED; APPROVING THIS AMENDED AND RESTATED RESOLUTION Timeline Referral to committee: October 22, 2010 Committee discussion: October 27, 2010 Deadline: Have council approve at the November 1, 2010 meeting Background and Alternatives Explored: This resolution identifies the federal reimbursement to be received (as an interest rate reduction) for the recently sold sewer bonds as a gross revenue of the sewer system. This underlying change to our sewer system ordinance is needed to actually utilize the federal funds. This change has been approved by the State Department of Natural Resources, who hold the remaining sewer system bonds. This resolution needs to accompany the approval of the final bond resolution for the recently awarded $10,345,000 of Taxable Sewer System Revenue Bonds, Series 2010 -Recovery Zone Economic Development Bonds sold to DA Davidson on October 18, 2010. This ---PAGE BREAK--- resolution has been prepared by the City's bond counsel, Dorsey Whitney. This bond sale utilized financing that is taxable to handle the construction costs for the recently awarded Sewer Headworks Project, but is subsidized by the federal government to provide the equivalent of tax exempt financing with a 45% interest reimbursement that would be paid to the city at each interest payment date. This financing contains very favorable terms to pay for the costs associated with the sewer plant headworks upgrade. This resolution provides all of the specifics for the purchasers of this recently awarded sewer system bond sale. Financial Implications: This resolution is needed to complete the financing package developed by the City Council to reconstruct the headworks at the city's wastewater plant. Sewer rates were increased last year by 5% and will be increased by 5% in 2011, 2012 and 2013 to handle the debt service requirements of this financing as well as the revenue bonds issued to complete the Rattlesnake Valley sewer project currently under construction. Attachments: Draft Resolution Appendix A