HomeMy WebLinkAbout4.A. Qualified 501(c)(3) Tax Abatement Bonding to Finanace Community Center/Ice Arena Project Public Hearings 4. A.
SHAKOPEE
TO: Mayor and City Council
FROM: William H. Reynolds, City Administrator
DATE: 12/17/2015
SUBJECT: Qualified 501(c)(3) Tax Abatement Bonding to Finance Community
Center/Ice Arena Project
Action Sought
To conduct a public hearing on the proposal to designate tax abatement bonds
"qualified 501(c)(3) bonds" pursuant to Section 145 of the Internal Revenue Code
and specifically to identify one or more nonprofit organizations exempt from
federal income taxation under Section 501(a) of the Code, as a result of the
application of Section 501(c)(3) of the Code as qualified 501(c)(3) users of the
project.
Background
On June 30th, 2015 Council directed staff to proceed with the necessary steps to
utilize tax abatement bonds to fund the proposed Community Center Project. On
September 22nd, a public hearing on the proposal to issue tax abatement bonds was
conducted with the subsequent approval of Resolution 7615 authorizing the use of
tax abatement bonds. On November 17th, Council authorized the issuance and sale
of general obligation tax abatement bonds, series 2016A, in the proposed aggregate
principal amount of$31,845,000, and set the sale of the bonds for December 17th,
2015 with a follow-on special council meeting on that date to award the sale of the
bonds.
A public hearing is required to specifically identify one or more nonprofit users of
the facility in order to be eligible for the Section 501(c)(3) status of the bonds.
Following the public hearing, and in conjunction with the actual sale of the bonds,
Council will be asked to approve Resolution No. 7663 awarding the sale of general
obligation tax abatement bonds, Series 2016A, in the original aggregate principle
amount of$31,845,000; fixing their form and specifications; directing their
execution and delivery; and providing for their payment.
Requested Action
To conduct a public hearing on the proposal to designate tax abatement bonds
"qualified 501(c)(3) bonds" pursuant to Section 145 of the Internal Revenue Code,
and to identify one or more nonprofit organizations exempt from federal income
taxation under Section 501(a) of the Code, as a result of the application of Section
501(c)(3) of the Code as qualified 501(c)(3) users of the project.