05-26-09 Common Council Meeting Agenda & Packet

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(g) To make any other change which, in the determination of the Council in its sole discretion, is not to the material prejudice of the owners of the 2009 Bonds. SECTION 24. Tax Matters. In order to preserve the exclusion of interest on the 2009 Bonds from gross income for federal income tax purposes and as an inducement to purchasers of the 2009 Bonds, the City represents, covenants and agrees that: (a) No person or entity, other than the City or another state or local governmental unit, will use proceeds of the 2009 Bonds or property financed by the 2009 Bond proceeds other than as a member of the general public. No person or entity other than the City or another state or local governmental unit will own property financed by 2009 Bond proceeds or will have actual or beneficial use of such property pursuant to a lease, a management or incentive payment contract, an arrangement such as take-or-pay or output contract, or any other type of arrangement that differentiates that person's or entity's use of such property from the use by the public at large. (b) No 2009 Bond proceeds will be loaned to any entity or person other than a state or local governmental unit. No 2009 Bond proceeds will be transferred, directly or indirectly, or deemed transferred to anon-governmental person in any manner that would in substance constitute a loan of the 2009 Bond proceeds. (c) The City will not take any action or fail to take any action with respect to the 2009 Bonds that would result in the loss of the exclusion from gross income for federal income tax purposes of interest on the 2009 Bonds pursuant to Section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), and the regulations thereunder as applicable to the 2009 Bonds, including, without limitation, the taking of such action as is necessary to rebate or cause to be rebated arbitrage profits on 2009 Bond proceeds or other monies treated as 2009 Bond proceeds to the federal government as provided in Section 148 of the Code, and will set aside such monies, which may be paid from investment income on funds and accounts notwithstanding anything else to the contrary herein, in trust for such purposes. (d) The City will file an information report on Form 8038-G with the Internal Revenue Service as required by Section 149 of the Code. (e) The City will not make any investment or do any other act or thing during the period that any 2009 Bond is outstanding hereunder which would cause any 2009 Bond to be an "arbitrage bond" within the meaning of Section 148 of the Code and the regulations thereunder as applicable to the 2009 Bonds. Notwithstanding any other provisions of this Ordinance, the foregoing covenants and authorizations (the "Tax Sections") which are designed to preserve the exclusion of interest on the 2009 Bonds from gross income under federal law (the "Tax Exemption") need not be complied with to the extent the City receives an opinion of nationally recognized bond counsel that compliance with such Tax Section is unnecessary to preserve the Tax Exemption. -29-