HomeMy WebLinkAbout2014-255A-4/14/2014NOTICE AND CALL OF PUBLIC MEETING
Governmental Body: The City Council of the City of Waterloo, State of Iowa.
Date of Meeting: April 14, 2014.
Time of Meeting: 5:30 P.M.
Place of Meeting: Law Court Theater, Waterloo Center for the Arts, Waterloo, Iowa.
PUBLIC NOTICE IS HEREBY GIVEN that the above mentioned governmental body
will meet at the date, time and place above set out. The tentative agenda for the meeting is as
follows:
$7,435,000 General Obligation Bonds, Taxable Series 2009A (Build America Bonds)
• Resolution Approving Closing Agreement
Such additional matters as are set forth on the additional 9 page(s) attached hereto.
This notice is given at the direction of the Mayor pursuant to Chapter 21, Code of Iowa,
and the local rules of the governmental body.
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Suzy Schares CMC
City Clerk
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April 14, 2014
The City Council of the City of Waterloo, State of Iowa, met in regular session, in the
Law Court Theater at the Waterloo Center for the Arts, Waterloo, Iowa, at 5:30 P.M., on the
above date. There were present Mayor Ernest G. Clark, in the chair, and the following named
Council Members:
Cole, Jones, Schmitt, Lind, Morrissey, Welper, Hart
Absent: none
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Council Member Morrissey introduced the following Resolution entitled
"RESOLUTION APPROVING CLOSING AGREEMENT", and moved that the same be
adopted. Council Member Welper seconded the motion to adopt. The roll was called and the vote
was,
AYES: Cole, Jones, Schmitt, Lind, Morrissey, Welper, Hart
NAYS: none
Whereupon, the Mayor declared the Resolution duly adopted as follows:
RESOLUTION NO. 2014-255A
RESOLUTION APPROVING CLOSING AGREMEENT
WHEREAS, on June 24, 2009 the City issued its $7,435,000 General Obligation Bonds,
Taxable Series 2009A (Build America Bonds); and
WHEREAS, pursuant to this then -new financing program, certain limitations were
imposed on the interest rates at which certain bonds could be re -offered to the public ("de
minimis premium limitations"), however, qualified bonds are entitled to a rebate of 35% of the
interest paid by the Issuer on the bonds (which amount was subsequently changed to 28% due to
the federal budget sequester); and
WHEREAS, the offering documents for the Bonds included the de minimis premium
limitations as such were outlined in applicable regulations; and
WHEREAS, on July 29, 2013, the Bonds were selected for routine review by the Internal
Revenue Service; and
WHEREAS, the Service has not formally asserted any claims against the City related to
the Bonds, but now interprets the regulations to requires a different application of the de minimis
premium limitations; and
WHEREAS, while arguments exist to refute the Service's interpretation of the
regulations, there is no cost-effective venue or process to change and clarify contested claims;
and
WHEREAS, City staff has negotiated a settlement with the Service to resolve further
inquiry on the point of the re -offered pricing for the Bonds; and
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WHEREAS, the Service has presented the City with a "Closing Agreement" to resolve
the inquiry to preserve the status of the Bonds as `Build America Bonds" under the Code thereby
securing the right to retain past, and continue to receive future, tax credit rebates on the Bonds.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF WATERLOO, STATE OF IOWA:
Section 1. That the Closing Agreement and Consent attached hereto as Exhibit A is
hereby approved, and the Mayor and Clerk are directed to execute the same on behalf of the
City.
Section 2. That executed copies of the Closing Agreement and Consent, along with
payment in the amount of $5,106.72 in satisfaction thereof, shall be provided in accordance with
the Agreement.
PASSED AND ADOPTED this 14'h day of April, 2014.
Ernest G. Clark, Mayor
ATTEST:
Suzy Schares, qMC
City Clerk
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Under section 7121 of the Internal Revenue Code of 1986, as amended (the "Code"),
the City of Waterloo, Iowa, EIN 42-6005327 (the "Issuer") and the Commissioner of
Internal Revenue (the "IRS") make this closing agreement (the "Agreement").
WHEREAS, this Agreement is based on the following facts and representations:
A. This Agreement is in settlement of issues raised in an examination of the
$7,435,000 General Obligation Bonds, Taxable Series 2009A (Qualified Build
America Bonds) (the "Bonds"), dated and issued on June 24, 2009.
B. The IRS conducted an examination of the Bonds and concluded that the. Bonds
fail to meet the requirements of section 6431 of the Code for the allowance of
credit with respect to interest payments under certain bonds of the issue
because the June 1, 2010-2015 maturities of the Bonds were issued with an
amount of premium in excess of the de minimis amount of premium permitted by
secion 54AA�d)�2)(C) of -the Code.
C. The IRS has not formally asserted any claims against the Issuer.
D. The Issuer and the IRS desire to resolve the issue(s) raised during the
examination of the Bonds and identified in paragraph B of this Agreement.
E. The terms of this Agreement were arrived at pursuant to negotiation between the
Issuer and the IRS, and may differ from the settlement terms of other bond
issues examined or to be examined by the IRS.
NOW, IT IS HEREBY DETERMINED AND AGREED PURSUANT TO THIS CLOSING
AGREEMENT EXECUTED BY THE PARTIES HERETO UNDER CODE SECTION 7121
THAT FOR FEDERAL INCOME TAX PURPOSES:
1. Prior to the execution of this Agreement by the IRS, the Issuer shall cause to be
electronically paid the sum of $5,106.72 (Five Thousand One Hundred Six and
721100 dollars) (the "Settlement Amount") to the U.S. Treasury via the Electronic
Federal Tax Payment System and in accordance with the directions contained in
Exhibit A of this Agreement.
2. The Settlement Amount is not refundable or subject to credit or offset under any
circumstance.
3. The Settlement Amount or any portion thereof paid by or on behalf of the Issuer
shall not be deductible or amortizable for federal income tax purposes by any
person.
4. The Settlement Amount shall not be treated as income to any person benefiting
from this Agreement.
5. The Bonds' compliance with the requirements under section 6431 of the Code
shall be determined by disregarding any effect resulting from the violation(s)
CLOSING AGREEMENT between City of Waterloo, Iowa EIN (42-6005327) and the
Commissioner of internal Revenue
identified in paragraph B of this Agreement and the IRS may take any
appropriate action with respect to the allowance of credit on the Bonds for any
other violation.
6. The IRS may take any appropriate action with respect to the allowance of credit
with respect to interest payments on the Bonds for any violation occurring after
the date of this Agreement, with the exception of any violation resulting from the
issues identified in paragraph B of this Agreement.
7. This Agreement may not be cited or relied upon by any person or entity
whatsoever as precedent in the disposition of any other case.
8. This Agreement is final and conclusive, except that:
a) The matter it relates to may be reopened in the event of fraud, malfeasance,
or misrepresentation of a material fact;
b) It is subject to sections of the Code that expressly provide that effect be
given to- their provisions notwithstanding any other law -or rule of law; and
c) If it relates to a tax period ending after the effective date of this agreement, it
is subject to any law enacted after the Agreement date that applies to that tax
period.
This space intentionally left blank.
Page 2 of 3
CLOSING AGREEMENT between City of Waterloo, Iowa EIN (42-6005327) and the
Commissioner of Internal Revenue
By signing, the above parties certify that they have read and agreed to the terms of this
Agreement.
ISSUER: City of Waterloo, Iowa
EIN: 42-6005327
By signing, I certify that I have the authority to execute this
Agre nt on behalf of Issuer
SIGNATURE
YU 6-&T-
NAME
5i
NAME (PLEASE PRINT)
_o>-
TITLE
/�` ,moi V
DATE
COMMISSIONER OF INTERNAL REVENUE:
BY:
SIGNATURE
Rebecca Harrigal
Director, Tax Exempt Bonds
NAME AND TITLE
4f//y
DATE
Page 3 of 3
CLOSING AGREEMENT between City of Waterloo, Iowa EIN (42-6005327) and the
Commissioner of Internal Revenue
Exhibit A
Taxpayer Information Worksheet for Electronic Federal 'Tax Payment System Deposit
This Agreement requires the electronic deposit of an amount to the U.S. Treasury
through the Electronic Federal Tax Payment System (EFTPS) as a term for resolution of
certain identified matters related to the tax -advantaged treatment of interest paid on a
municipal obligation. This payment must be deposited in accordance with the directions
contained herein.
Please carefully review the taxpayer information listed below and immediately report any
errors to the IRS Tax Exempt Bonds employee assigned to your case. If, to the best of
your knowledge, the information is correct, then please deposit all required payments
through the EFTPS (either EFTPS - Direct or EFTPS - Through a Financial Institution)
accurately and in accordance with this information and the terms of this Agreement.
1. Total Amount of Tax Deposit: $5,106.72
2. Taxpayer's Employee Identification Number (EIN): 42-6005327
3. Taxpayer Name Control (4 characters): CITY
4. Taxpayer Name (up to 35 characters): City of Waterloo
5. Tax Type (5 characters). 80384
6. Tax Year (2 digits): 09
7. Tax Month (2 digits): 06
' Your financial institution may call the EFTPS Financial Institution Helpline for questions
or assistance at 1-800-605-9876 (Monday - Friday, 8:00 a.m. - 8:00 p.m., Eastern
Standard Time).
NOTE: If you are not enrolled in EFTPS - Direct or EFTPS - Through a Financial Institution, or
otherwise wish to use the Same Day Payment option, then please provide your financial institution
with the information listed above and direct them. to accurately deposit your payments utilizing the
following routing and account numbers: Note that the Receiving ABAIRouting Number,
Receiving Fl Name, Tax Type (under Beneficiary) and Beneficiary FI indicated below do not
change.
Receiving ABA/Routing Number: 091036164 FRB MPLS ETA
Receiving FI Name: US TREAS SINGLE TX
.Beneficiary: 426004675: C ITY:CITYOFWATERLOO:80384:09:06
Beneficiary Fl: 20092900IRS
If the financial institution has difficulty transmitting the EFTPS same-day payment, please call
1-500-382-0045 (Monday — Friday, 7:45 a.m. — 4:30 p.m. Central Standard Time) to receive
assistance from a Customer Service Representative at the Minneapolis Federal Reserve Bank.
Page I of I
• CLOSING AGREEMENT between City of Waterloo, Iowa EIN (426005327) and the
Commissioner of Internal Revenue
I hereby consent, pursuant to section 6103(c) of the Internal Revenue Code of
1986 (as amended), to the disclosure of return information (as defined in section
6103(b)(2) ) relating to the Closing Agreement (the "Agreement") between the City of
Waterloo, Iowa, EIN 42-6005327 (the "Taxpayer") and the Commissioner of Internal
Revenue pertaining to the $7,435,000 General Obligation Bonds, Taxable Series 2009A
(Qualified Build America Bonds), executed by the Taxpayer on
as follows:
The Internal Revenue Service may disclose the existence and subject matter of
the Agreement to the extent that the Internal Revenue Service deems necessary to
correct any material misstatement with respect to the Agreement in response to a public
statement by the Taxpayer or an agent of the Taxpayer.
Such disclosure may be made to Members of Congress, the press, and the
general public, and may be made by any means, including press releases and notices in
Internal Revenue Service publications.
I am aware that in the absence of this authorization, the returns and return
information of the City of Waterloo, Iowa are confidential and may not be disclosed
except as authorized by the Internal Revenue Code.
I certify that I have the authority to execute this consent on behalf of the
Taxpayer.
Taxpayer Name:
Taxpayer TI N:r
Taxpayer Address: 04
By:
Title:,
Signature:��
Date:
CERTIFICATE
STATE OF IOWA )
) SS
COUNTY OF BLACK HAWK )
I, the undersigned City Clerk of the City of Waterloo, State of Iowa, do hereby certify
that attached is a true and complete copy of the portion of the corporate records of the City
showing proceedings of the City Council, and the same is a true and complete copy of the action
taken by the Council with respect to the matter at the meeting held on the date indicated in the
attachment, which proceedings remain in full force and effect, and have not been amended or
rescinded in any way; that meeting and all action thereat was duly and publicly held in
accordance with a notice of meeting and tentative agenda, a copy of which was timely served on
each member of the Council and posted on a bulletin board or other prominent place easily
accessible to the public and clearly designated for that purpose at the principal office of the
Council (a copy of the face sheet of the agenda being attached hereto) pursuant to the local rules
of the Council and the provisions of Chapter 21, Code of Iowa, upon reasonable advance notice
to the public and media at least twenty-four hours prior to the commencement of the meeting as
required by law and with members of the public present in attendance; I further certify that the
individuals named therein were on the date thereof duly and lawfully possessed of their
respective City offices as indicated therein, that no Council vacancy existed except as may be
stated in the proceedings, and that no controversy or litigation is pending, prayed or threatened
involving the incorporation, organization, existence or boundaries of the City or the right of the
individuals named therein as officers to their respective positions.
WITNESS my hand and the seal of the City hereto affixed this 14th day of April, 2014.
(SEAL)
Suzy Schares, CMC
City Clerk
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