Title
Resolution Approving Staff Allocation of Funding Sources for Existing Capital Budget Expenditures Which Have Been Appropriated and Approved
Purpose
PURPOSE/BACKGROUND:
The City Council annually adopts the Capital Budget ordinance, which includes parenthetical notations of the anticipated revenue source for each project expenditure identified in the Capital Budget. With the exception of certain tax exempt bond revenues, the allocation of revenue sources approved in the Capital Budget is discretionary and does not require City Council approval. However, changing the allocation of bond proceeds does require Council approval. As staff prepares for the bond issue and consults with its Financial Advisors and Bond Counsel, it may be determined that it is more advantageous for the City to change how Council approved funding sources are allocated among Council approved projects in order protect the tax exempt status of its bonds. This resolution gives staff the flexibility to tweak how approved funding sources are applied to approved projects in the period between when the Capital Budget is adopted and the bonds are officially authorized by Council. When Council authorizes the bonds, they will formally adopt which projects will be funded with bond proceeds. Any changes to those allocations once Council formally adopts them will require Council approval.
Recommendation:
Rec
Approve
Body
WHEREAS, the City Council annually adopts the Capital Budget ordinance which includes parenthetical notations of the anticipated revenue source for each project expenditure identified in the Capital Budget;
WHEREAS, with the exception of certain tax exempt bond revenues, the allocation of revenue sources approved in the Capital Budget is discretionary;
WHEREAS, federal regulations set a limit on how much of a tax exempt bond can be used for private activities, which may include acquisitions of property that may be used for redevelopment;
WHEREAS, each capital budget typically includes some projects that may be considered “private activities” as defined by the federal regulations;
WHEREAS, what constitutes “private activity” and its impact on the tax exempt status of City bonds is determined by the City’s Bond Counsel and stated in an opinion of such Counsel when such bonds are issued;
WHEREAS, the Council recognizes that staff requires flexibility in determining how to most effectively allocate bond revenues and other revenue sources among projects identified in the Council Approved Capital Budget; and
WHEREAS, the City Council of the City of Hampton wants to ensure that the City’s bond revenues are applied in conformance with all applicable laws and regulations governing the use of tax exempt bonds while simultaneously ensuring the most efficient and effective use of all revenues for City projects.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF HAMPTON, VIRIGINA that notwithstanding the parenthetical notations allocating certain approved revenues to approved project expenditures in the City Council Approved Capital Budget, the City Manager or her designee has the authority to allocate the approved revenues to the approved expenditures in a manner that is most effective and in the best interest of the City, subject to obtaining Council approval of the allocation of tax exempt bond proceeds when such bonds are authorized.