HomeMy WebLinkAbout13 Aquire Snow Removal equipment Agenda Item # 1
TRUCKEE DONNER
DistrictPublic Utility
Memorandum
To: Board of Directors
From: Mary Chapman, Administrative Services Manager
Date: January 31, 2002
Subject: Consideration of documents related to financing the acquisition of snow
removal equipment
On November 8, 2001, Kathy Neus went out to bid for the purchase of snow removal equipment
to be used primarily at the electric substations and in the District yard. On November 28, 2001,
the Board awarded the bid to SNOQUIP in the amount of$61,974.19.
This purchase was not part of the 2001 or 2002 budget. Before the staff went out to bid we
discussed how we would pay for the equipment. It was determined that we should finance it
over a five-year period.
I have arranged for financing with Municipal Services Group. The interest rate is 5.47%. The
scheduled payment will be $3,545.77 per quarter for 5 years. We will include the payment
schedule in the 2003 to 2006 budgets.
RECOMMENDATION:
1. To approve the attached resolution entitled Approving Agreement to Acquire Equipment for
the acquisition and financing of a snow blower.
2. Authorize the Board President and Secretary to execute the lease documents after approval
of the documents by legal counsel.
TRUCKEE KIII
DONNER
PublicDistrict
Resolution No, 2002-
APPROVING AGREEMENT TO ACQUIRE EQUIPMENT
WHEREAS, the Board of Directors of the Truckee Donner Public Utility District
has determined that a true and very real need exists for the acquisition of the
equipment described in the individual Payment Schedule No. 7 and the Master
Municipal Lease and Option Agreement No. 909 presented at this meeting; and
WHEREAS, the Board of Directors has taken the necessary steps under
applicable law, including any legal bidding requirements, to arrange for the
acquisition of such equipment; and
WHEREAS, the Board hereby directs its legal counsel to review the agreement
and negotiate appropriate modifications to said agreement so as to assure
compliance with state law and local statutory law, prior to execution of the
agreement by those persons so authorized by the District for such purposes;
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors as follows:
1. The Board finds that the terms of said agreement are in the best interests
of the District for the acquisition of such equipment and the Board
designates and confirms the Board President and the Treasurer to
execute and deliver, and to witness (or attest) respectively, the agreement
and any related documents necessary for the consummation of the
transactions contemplated by the agreement.
2. That the acquisition of the equipment, under the terms and conditions
provided for in the agreement is necessary, convenient, in the furtherance
of and will at all times be used in connection with the District's
governmental and proprietary purposes and functions (except to the
extent that subleasing of the equipment is permitted under the terms of the
agreement) and are in the best interests of the District and no portion of
the equipment will be used directly or indirectly in any trade or business
carried on by any person other than a governmental unit of the state on a
basis different from the general public.
3. The Lessee covenants that it will perform all acts within its power which
are or may be necessary to insure the maintenance of its legal status as
being a duly organized and existing entity under the laws of the state,
which status is the basis for the interest portion of the rental payments
coming due under the agreement to at all times remain exempt from
federal income taxation under the laws and regulations of the United
States of America as presently enacted and construed or as hereafter
amended.
4. It is the intent of the District to be reimbursed from the proceeds of the
Agreement approved herein for prior expenditures in the event that the
District elects to disburse moneys from its own reserves for acquiring the
equipment. Such declaration of official intent to be reimbursed is issued
pursuant to Section 1.103-18 of the Federal Income Tax Regulations.
PASSED AND ADOPTED by the Board of Directors at a meeting duly called and
held within the District on the sixth day of February, 2002 by the following roll call
vote:
AYES:
NOES:
ABSENT:
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
Nelson Van Gundy, President
ATTEST:
Peter L. Holzmeister, District Clerk
INDIVIDUAL PAYMENT SCHEDULE 07
TO
MASTER MUNICIPAL LEASE AND OPTION AGREEMENT NUMBER 909
Entered into February 1,2002,(the"Dated Date")by and between the Lessor and the Lessee,this Individual Payment Schedule#7 is made a part of
Master Municipal Lease and Option Agreement Number 909 and hereby incorporates all terms and conditions of said Agreement with respect to
Lessee's and Lessor's rights in the personal property described in this Schedule.
This individual Pa t Scheabile crinsku;of,
Exhibit A Resolution of Governing Body
Exhibit B Opinion of Lessee's Counsel
Exhibit C Certificate as to Arbitrage
Exhibit D Description of Equipment
Exhibit E Schedule of Payments
Exhibit F Acceptance Certificate
Exhibit G Insurance Coverage Requirements
Supplements: 8038-G IRS Filing
Bank Eligibility Certificate
Small Issuer Exemption Certificate
LESSOR: Municipal Services Group,Inc. LESSEE: Truckee Donner Public Utility District
By: By:
Title: Title: President, Board of Directors
Date: Date:
EXHIBIT A - Pa.ae I of 2
rrliemi,l • C1M DQ ��
PublicDistrict
Resolution No. 2002-
APPROVING AGREEMENT TO ACQUIRE EQUIPMENT
WHEREAS, the Board of Directors of the Truckee Donner Public Utility District
has determined that a true and very real need exists for the acquisition of the
equipment described in the individual Payment Schedule No. 7 and the Master
Municipal Lease and Option Agreement No. 909 presented at this meeting; and
WHEREAS, the Board of Directors has taken the necessary steps under
applicable law, including any legal bidding requirements, to arrange for the
acquisition of such equipment; and
WHEREAS, the Board hereby directs its legal counsel to review the agreement
and negotiate appropriate modifications to said agreement so as to assure
compliance with state law and local statutory law, prior to execution of the
agreement by those persons so authorized by the District for such purposes;
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors as follows:
1. The Board finds that the terms of said agreement are in the best interests
of the District for the acquisition of such equipment and the Board
designates and confirms the Board President and the Treasurer to
execute and deliver, and to witness (or attest) respectively, the agreement
and any related documents necessary for the consummation of the
transactions contemplated by the agreement.
2. That the acquisition of the equipment, under the terms and conditions
provided for in the agreement is necessary, convenient, in the furtherance
of and will at all times be used in connection with the District's
governmental and proprietary purposes and functions (except to the
extent that subleasing of the equipment is permitted under the terms of the
agreement) and are in the best interests of the District and no portion of
the equipment will be used directly or indirectly in any trade or business
carried on by any person other than a governmental unit of the state on a
basis different from the general public.
EXHIBIT A - Page 2 of 2
3. The Lessee covenants that it will perform all acts within its power which
are or may be necessary to insure the maintenance of its legal status as
being a duly organized and existing entity under the laws of the state,
which status is the basis for the interest portion of the rental payments
coming due under the agreement to at all times remain exempt from
federal income taxation under the laws and regulations of the United
States of America as presently enacted and construed or as hereafter
amended.
4. It is the intent of the District to be reimbursed from the proceeds of the
Agreement approved herein for prior expenditures in the event that the
District elects to disburse moneys from its own reserves for acquiring the
equipment. Such declaration of official intent to be reimbursed is issued
pursuant to Section 1.103-18 of the Federal Income Tax Regulations.
PASSED AND ADOPTED by the Board of Directors at a meeting duly called and
held within the District on the sixth day of February, 2002 by the following roll call
vote:
AYES:
NOES:
ABSENT:
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
Nelson Van Gundy, President
ATTEST:
Peter L. Holzmeister, District Clerk
EXHIBIT B
OPINION OF COUNSEL
(On Attorneys Letterhead)
Municipal Services Group,Inc.
5125 South Kipling Parkway
• Suite 300
Littleton,CO 80127
Ladies and Gentlemen:
With respect to Individual Payment Schedule No. 7 and that certain Master Municipal Lease and Option Agreement ("the Agreement") by and
between Municipal Services Group, Inc.("Lessor")and Truckee Donner Public Utility District("Lessee")I am of the opinion that: (i)the Lessee is a
state or political subdivision thereof within the meaning of Section 103 of the Internal Revenue Code of 1986. as amended: (ii) the execution,
delivery and performance by the Lessee of the Agreement has been duly authorized by all necessary action on the part of the Lessee; (iii) the
Agreement is a legal, valid and binding obligation of Lessee, enforceable in accordance with its terms. To the extent lawful, in the event the Lessor
obtains a judgment against Lessee in money damages,as a result of an event of default under the Agreement, Lessee will be obligated to pay such
judgment:(iv)the signatures of the officers of the Lessee which appear on the Agreement are true and genuine;I know said officers and know them
to hold the offices set forth below their names; and (v) the Equipment leased pursuant to the Agreement constitutes personal property under
applicable law and when subjected to use by Lessee will not be construed as a fixture.
Attorney for Lessee
Firm Name
Agreement No.909-7
EXHIBIT C
CERTIFICATE AS TO ARBITRAGE
I, the undersigned officer of Truckee Donner Public Utility District (the "Lessee") being the person duly charged, with others, with
responsibility of issuing the Lessee's obligation in the form of that certain agreement entitled Master Municipal Lease and Option Agreement (the
"Agreement")numbered 909,and issued said date HEREBY CERTIFY that:
I. The Agreement was issued by the Lessee under and pursuant to existing law to finance the acquisition of the certain Equipment
described therein.
2. Pursuant to the Agreement, the Lessee is entitled to receive said Equipment in consideration for the obligation of the Lessee under the
Agreement. Said Equipment will be used in furtherance of the public purposes of the Lessee. The Lessee does not intend to sell said Equipment or
said Agreement or to otherwise dispose of said Equipment during the term of the Agreement. The Lessee will not receive any monies,funds,or other
"proceeds"as a result of the Agreement.
3. The Lessee expects to make payments under the Agreement from its general funds on the basis of annual appropriations in amounts
equal to the required payments under the Agreement. The remaining general funds of the Lessee are not reasonably expected to be used to make
such payments and no other monies are pledged to the Agreement or reasonably expected to be used to pay principal and interest on the Agreement.
4. The Lessee has not received notice that its Certificate may not be relied upon with respect to its own issues nor has it been advised that
any adverse action by the Commissioner of Internal Revenue is contemplated.
5. The Lessee certifies that the Property(as defined in the Agreement)is or will be owned and operated by the Lessee and will not be used
in the trade or business of any person on a basis different from the general public.
To the best of my knowledge, information and belief the expectations herein expressed are reasonable and there are no facts, estimates or
circumstances other than those expressed herein that would materially affect the expectations herein expressed.
IN WITNESS WHEREOF,I have hereunto set my hand this day of 20
LESSEE: Truckee Donner Public LRility District
By
Tide:_President, Board of Directors
Agreement No.909-7
EXHIBIT D
DESCRIPTION OF EQUIPMENT
The Equipment which is the subject of the Individual Payment Schedule No_7 to the Master Municipal Lease and Option Agreement is as
follows:
One(1)New Trackless MT5 Snowblower
Serial No.MT5T2025
Together with all additions,accessions and replacements thereto.
Lessee hereby certifies that the description of the Equipment set forth above constitutes an accurate description of the "Equipment', as
defined in the attached Master Municipal Lease and Option Agreement applicable Individual Payment Schedule.
LESSEE: Truckee Donner Public Utility District
By:
Title: president, Board of Directors
Address of Equipment Upon Delivery and Acceptance:
EXHIBIT E
SCHEDULE OF PAYMENTS Agreement No. 909-7
DATED DATE: Feb 01, 2002
Truckee Donner Public Utility District
PMT PAYMENT PRINCIPAL INTEREST PURCHASE
# DATE PAYMENT PORTION PORTION PRICE
1 1 - Apr-02 3,545.77 2,997.80 547.97 60,714,33
2 1 - Jul-02 3,545.77 2,739.28 806,50 57,813.65
3 1 - Oct-02 3,545.77 2,776.73 769.04 54,882.15
4 1 - Jan-03 3,545.77 2,814.70 731.07 51,919.50
5 1 - Apr-03 3,545.77 2,853.19 692.58 48,925,37
6 1 - Jul-03 3,545.77 2,892.21 653.56 45,899.43
7 1 - Oct-03 3,545.77 2,931.76 614.01 42,841.34
8 1 - Jan-04 3,545.77 2,971.85 573,92 39,750.76
9 1 - Apr-04 3,545.77 3,012.49 533.28 36,627.34
10 1 - Jul-04 3,545.77 3,053.69 492.08 33,470.74
11 1 - Oct-04 3,545.77 3,095.45 450.32 30,280.60
12 1 - Jan-05 3,545.77 3,137,78 407.99 27,056.56
13 1 - Apr-05 3,545.77 3,180.68 365.09 23,798.27
14 1 - Jul-05 3,545,77 3,224.18 321.59 20,505.36
15 1 - Oct-05 3,545.77 3,268.27 277.50 17,177.46
16 1 - Jan-06 3,545,77 3,312.96 232.81 13,814.20
17 1 - Apr-06 3,545.77 3,358.27 187.50 10,415.21
18 1 - Jul-06 3,545.77 3,404.19 141.58 6,980.10
19 1 - Oct-06 3,545.77 3,450.75 95.02 3,508.49
20 1 - Jan-07 3,545.77 3,497.97 47,80 0.00
TOTAL 70,915.40 61,974.19 8,941.21
LESSEE: Truckee Donner Public Utility District
BY:
TITLE: President, Board of Directors
Agreement No.909-7
EXHIBIT E
SCHEDULE OF PAYMENTS Paget of 2
Base Interest Rate: 5.47%
U. S.Treasury Note Yield: 4.23%
U. S.Treasury Note Index Percent: 129.31%
Adjusted Base Interest Rate:
Dated Date: February 1,2002
Provided all documents have been returned in a form acceptable to Lessor within thirty (30)days of the Dated Date (the "Period"),then the Base
In the event all documents have not been returned within the Period, in a form acceptable to
Interest Rate can remain in effect during the Period.
Lessor, and/or if the U. S. Treasury Note Yield for a maturity comparable to the Lease Term increases significantly,the Lessor reserves the right to
adjust and determine a new Base Interest Rate(the"Adjusted Base Interest Rate")pursuant to the provisions hereof. The Adjusted Base Interest Rate
shall be determined by multiplying the U. S.Treasury Note Yield for a maturity comparable to the Lease Term(as of the business day immediately
preceding the receipt of the documents by the Lessor) by the U. S. Treasury Note Index Percent. Such Adjusted Base Interest Rate shall be the
applicable interest rate for the principal balance of the Equipment that is the subject of this Individual Payment Schedule, and the Lessor and the
Lessee shall execute a revised Exhibit E to this Individual Payment Schedule to acknowledge such change.
LESSEE: Truckee Donner Public Utility District
By:
Title: President Board of Directors
Agreement No.909-7
EXHIBIT F
ACCEPTANCE CERTIFICATE
The undersigned, as Lessee under the Master Municipal Lease and Option Agreement(the "Agreement') numbered 909, with Municipal
Services Group,Inc. ("Lessor"),acknowledges receipt in good condition of the Equipment described in the Agreement or in the applicable Individual
Payment Schedule attached thereto this day of and certifies that Lessor has fully and satisfactorily performed
all of its covenants and obligations required under the Agreement.
Lessee confirms that it will commence payments in accordance with Article 6 of the Agreement or the provisions of the applicable
Individual Payment Schedule.
The undersigned officer of the Lessee hereby reaffirms in all respects the Certificate as to Arbitrage attached as Exhibit C to the
Agreement,and represents that,to the best of his or her knowledge,information and belief,the expectations therein expressed were reasonable as of
the Accrual Date on which they were made, and are reasonable as of this date, and that there were, and are as of this date, no facts, estimates or
circumstances other than those expressed therein that would materially affect the expectations expressed therein.
LESSEE: Truckee Dormer Public Utility District
By:
Title: President Board of Directors
Agreement No.909-7
EXHIBIT G
INSURANCE COVERAGE REQUIREMENTS
TO: Municipal Services Group,Inc.
5125 South Kipling Parkway
Suite 300
Littleton,CO 80127
FROM: Truckee Donner Public Utility District
P.O.Box 309
Truckee,CA 96161
SUBJECT: INSURANCE COVERAGE REQUIREMENTS
1. In accordance with Section 8.03 of the Master Municipal Lease and Option Agreement No.909,we have instructed the insurance
agent named below(please fill in name,address,and telephone number)
AON Risk Services Inc
tgg Fremont Street 14 Floor
San Francisco, CA 94105
to issue:
a. All Risk Physical Damage Insurance on the leased Equipment of Unit thereof(as defined in the Agreement) evidenced by a
Certificate of Insurance and Long Form i n Pnynhle Clanxe nAmIng i essur"flnd/or itassigns"ip,
pp
b. Public Liability Insurance evidence by a Certificate of Insurance naming"Lessor and/or its assigns"as an Additional Insured.
Minimum Coverage Required:
$500,000.00 per person
$500,000.00 aggregate bodily injury liability
$300,000.00 property damage liability
OR
2. Pursuant to Section 8.03 of the Agreement,we are self-insured for all risk physical damage and public liability and will provide
proof of such self-insurance in letter form together with a copy of the statute authorizing this form of insurance.
3. Proof of insurance coverage will be provided to Lessor prior to the time that the Equipment or Unit thereof is delivered to as.
LESSEE: Truckee Donner Public Utility District
By:
Title: presid n Board of Directors
m 8038_GC Information Return for Small Tax-Exempt
Governmental Bond Issues, Leases, and Installment Sales W0 Nn ,::4z mzo
(!7rv. May 1999} ► Under Internal Revenue Code section 149(e)
ocpoamon;or n,o rm.c
nromol RovenUc lt Caution: Use Form 8038-G if the Issue rice of the issue is $100,000 or more,
I acs p
Reporting Authority Check box if Amended Return ► ❑
1 Issuer s name 2 Issuer's employer identification number
Truckee Donner Public Utility District
3 Number and street(or P,0, box if mall is not delivered to street address) rtmmisulte
P. 0. Box 309
4 City, town.or post office. state,and ZIP code 5 Report number
Truckee, CA 96161 GC -
6 Name and title of officer or legal representative whom the IRS may call for more Information 7 Telephone number of officer or lepal represta tbt ve
Mary Chapman, Manager of Administrative Services ( 530 ) 587-3896
Descri tion of Obligations (Check if reporting: a single issue E, or on a consolidated basis ❑ ,)
Be Issue price of obligation(s) (see instructions). . . . . . . . . . . . . . . . . . Be
b Issue date (single issue) or calendar year (consolidated) (see instructions) ► .................... ate
9 Amount of the reported obligation(s) on line Ba: '
a Used to refund prior issue(s) . . . . . . . . . . . . . . . . . . . . . . ..9a
to Representing a loan from the proceeds of another tax-exempt obligation (e.g., bond bank) . , 96
10 If the issuer has designated any issue under section 265(b)(3)(B)(i)(I11) (small issuer exception), check this box . . . ►
11 If any obligation is in the form of a lease or installment sale, check this box . . . . . . . . . . . . . . . ►
12 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check this box , ► ❑
Under penalties of perjury, I declare that I have examined this return and.accompanying schedules and statements,and to the best of my knowledge
Please and belief, they are true, correct, and complete.
Sign Nelson Van Gundy
Here President Board of Directors
Issuer's authorized representative Date ' Type or print name and title
General Instructions Thus, an issuer may file a separate Form Other Forms That May Be Required
8038-GC for each of a number of small For rebatingarbitrage or paying a penaltyin
Section references are to the internal issues and report the remainder of small g ( p y g
lieu of arbitrage rebate) to the Federal
Revenue Code unless otherwise noted, issues issued during the calendar year on one
consolidated Form 8038-GC. However, a government, use Form 8038-T,Arbitrage
Purpose of Form separate Form 8038-GC must be filed to give Rebate and Penalty in Lieu of Arbitrage
Form 8038-GC is used b the issuers of the IRS notice of the election to pay a penalty Rebate. For private activity bonds, Form
Y Privet Information Return for Tax-Exempt
tax-exempt governmental obligations to in lieu of arbitrage rebate. Private Activity Bond Issues.
provide the IRS with the information required When To File
by section Ill and to monitor the Rounding to Whole Dollars
requirements of sections 141 through 150. To file a separate return, file Form 8038-GC You may show the money items on this
on or before the 15th day of the second return as whole-dollar amounts. To do so,
Who Must File calendar month after the close of the drop any amount less than 50 cents and
Issuers of tax-exempt governmental calendar quarter in which the issue is issued.
P 9 increase any amount from 50 cents through
obligations with issue prices of less than To file a consolidated return, fie Form gg cents to the next higher dollar.
$100,000 must file Form 8038-GC. 8038-GC on or before February 15th of the
Issuers of a tax-exempt governmental calendar year following the year in which the Definitions
obligation with an issue price of$100,000 or issue is issued. Obligations.This refers to a single
more must file Form 8038-G, Information Late filing.An issuer may be granted an tax-exempt governmental obligation if Form
Return for Tax-Exempt Governmental extension of time to file Form 8038-GC under 8038-GC is used for separate reporting or to
Obligations. Section 3 of Rev. Proc..88-10, 1988-1 C.B. multiple tax-exempt governmental obligations
Filing a separate return. Issuers have the 635, if it is determined that the failure to file if the form is used for consolidated reporting.
option to file a separate Form 8038-GC for on time is not due to willful neglect. Type or Tax-exempt obligation. This is a bond,
any tax-exempt governmental obligation with print at the top of the form,."This Statement installment purchase agreement, or financial
an issue price of less than $100,000, Is Submitted in Accordance with Rev. Prod. lease, on which the interest is excluded from
An issuer of a tax-exempt bond used to 88-1C." Attach to the Form 8038-GC a letter income under section 103.
Finance construction expenditures must file a brie,y stating why the form was not
p submitted to the IRS on time. Also indicate Tax-exempt governmental obligation.A
separate Form 8038-GC for each issue to whether the obligation in question is under tax-exempt obligation that is not a private
give notice to the IRS that an election was examination by
( the IRS. Do not submit copies activity bond (see below) is a tax.exempt
made t pay a penalty in lieu of arbitrage of any bond documents, leases, or installment governmental obligation. This includes a bond
rebate {see the line 12 instructions). sale documents. issued by a qualified volunteer fire
Filing a consolidated return. For all department under section 150(e).
tax-exempt governmental obligations with Where To File Private activity bond. This includes an
issue prices of less than $100,000 that are File Form 8038-GC with the Internal Revenue obligation issued as part of an issue in which:
not reported on a separate Form 8038-GC. Service Center, Ogden, UT 84201. • More than 10%of the proceeds are to be
an issuer must file a consolidated information
return including all such issues issued within used for any private activity business use,
the calendar year.
Cat. No.641083 Form 8038-GC (Rev. s-9s)
`ern 8038-GC(Rev.5-99) Page 2
a More than 109/ of the payment of principal Specific Instructions Lines 9a and 9b. For line 9a, enter the
or interest of the issue is either(a)secured amount of the proceeds that will be used to
by an interest In property to be used for a in general, a Form 8038-GC must be. pay principal, interest, or call premium on any
private business use (or payments for such completed on the basis of available other issue of bonds, Including proceeds that
property) or(b) to be derived from payments information and reasonable expectations as will be used to fund an escrow account for
for property(or borrowed money)used for a of the date the issue is issued. However, this purpose. Both line 9a and 91P may apply
private business use. forms that are Flied on a consolidated basis to a particular obligation. For example, report
it also includes a bond, the proceeds of may be completed on the basis of information on line 9a and 9b obligations used to refund
which are to be used to make or finance readily available to the issuer at the close of prior issues which represent loans from the
loans (other than loans described In section the calendar year to which the form relates, proceeds of another tax-exempt obligation.
141(c)(2)) to certain persons exceeds the supplemented by estimates made In good Line 11. Check this box if property other than
smaller of 5% of the proceeds or$5 million. faith. cash is exchanged for the ourgation, e.g.,
Issue. Generally, obligations are treated as acquiring a police car, afire truck, or
part of the same issue only if they are issued Part I—Reporting Authority telephone equipment through a series of
by the some issuer, on the same date, and as Amended return. if this is an amended Form monthly payments. (This type of obiiaatlon is
part of a single transaction, or a series of 8038-GC, check the amended return box. sometimes referred to as a "municipal lease.")
related transactions. However, obligations Complete Part I and only those lines of Form Also check this box if real property is directly
issued during the same calendar year (a) 8038-GC that are being amended. Do not acquired in exchange for an obligation to
under a loan agreement under which amounts amend estimated amounts previously make periodic payments of interest and
are to be advanced periodically(a reported once the actual amounts are principal. Do not check this box if the
'draw-down loan')or(b) with a term not determined. (See the Part 11 instructions proceeds of the obligation are received in the
exceeding 270 days, may be treated as part below.) form of cash, even if the term "lease" is used
of the same issue if the obligations are Line 1. The issuer's name is the name of the in the title of the issue.
equally and ratably secured under a single entity issuing the obligations, not the name of Line 12. Check this box if the issue is a
indenture or loan agreement and are issued the entity receiving the benefit of the construction issue and an irrevocable election
under a common financing arrangement(e.g.. financing. In the case of a lease or installment to pay a penalty in lieu of arbitrage rebate
under the same official statement periodically sale, the issuer is the lessee or purchaser. has been made on or before the date the
updated to reflect changing factual Line 2.An issuer that does not have an bonds were issued. The penalty is payable
circumstances). Also, for obligations issued employer identification number(EIN) should with a Form 8038-T for each 6-month period
under a draw-down loan that meets the after the date the bonds are issued. Do not
apply for one on Form SS-4, Application for
requirements of the preceding sentence, make any payment of penalty in lieu of rebate
obligations issued during different calendar Employer Identification Number. This form may be o
with this form. See Rev, Proc. 92-22, 1992.1
years may be treated as part of the same obtained at Social Security C.B. 736, for rules regarding the "election
issue if all of the amounts to be advanced Administration offices or by calling document." g g
under the draw-down loan are reasonably 1-800-TAX-FORM. If the EIN has not been
expected to be advanced within 3 years of received by the due date for Form 8038-GC,
write Applied for in the space for the EIN.
the date of issue of me hest obligation. " " Paperwork Reduction Act Notice
Likewise, obligations (other than private Line 5. Number reports consecutively based
activity bonds)issued under a single on the filing date(not the date of issue). For We ask for the information on this form to
example. if the issuer has.already filed two carry out the Internal Revenue laws of the
agreement that is a the form of a lease or P y United States. You are required to give us the
installment sale may e treated as part of the Forms 8038-GC in the 1e third
calendar year, information. We need it to ensure that you are
same issue e all of the property covered by the report number for the third Form 8036-GC complyingwith these laws.
that agreement is reasonably expected to be would be "GC1999-3." -
delivered within 3 years of the date of issue You are not required to provide the
of the first obligation. Part II—Description of information requested on a form that is
Arbitrage rebate. Generally, interest on a Obligation subject to the Paperwork Reduction Act
state oralocal bond is not tax exempt unless unless the form displays a valid OMB control
the issuer of the bond rebates to the United Line Ba. The issue price of obligations is number. Books or records relating to a farm
States arbitrage profits earned from investing generally determined under Regulations or its instructions must be retained as long as
proceeds of the bond in higher yielding section 1.148.1(b). Thus, when issued for their contents may become material in the
nonpurpose investments. See section 148(f). cash, the issue price is the price at which a administration of any Internal Revenue law.
substantial amount of the obligations are sold Generally, tax returns and return information
Construction issue. This is an issue of to the public. To determine the issue price of are confidential, as required by section 6103.
tax-exempt bonds that meets both of the an obligation issued for property, see The time needed to complete and file this
following conditions: sections 1273 and 1274 and the related form varies depending on individual
1. At least 75% of the available regulations. circumstances. The estimated average time
construction proceeds of the issue are to be Line 8b.For a single issue, enter the date of is:
used for construction expenditures with issue, generally the date on which the issuer Learning about the
respect to property to be owned by a physically exchanges the bonds that are part g
governmental unit or a 501(c)(3) organization, of the issue for the underwriter's(or other law or the form i hr., 51 min.
purchaser's) funds; for alease or installment Preparing the form . . . 2 hr., 56 min.
2. All of the bonds that are part of the issue sale, enter the date interest starts to accrue. Copying, assembling,and
are qualified 501(c)(3) bonds, bonds that are For issues reported on a consolidated basis, sending the form to the IRS 16 min.
not private activity bonds, or private activity enter the calendar year during which the
bonds issued to finance property to be obligations were issued, if you have comments concerning the
owned by a governmental unit or a 501(c)(3) accuracy of these time estimates or
organization. suggestions for making this form simpler, we
In lieu of rebating any arbitrage that may would be happy to hear from you. You can
be owed to the United States, the issuer of a write to the Tax Forms Committee, Western
construction issue may make an irrevocable Area Distribution Center, Rancho Cordova,
election to pay a penalty. The penalty is equal CA 9 5 7 4 3-0001, DO NOT send the form to
to 1'/,% of the amount of construction this address. Instead, see Where To File on
proceeds that do not meet certain spending page 1.
requirements. See section 148(n(4)(C) and the
Instructions for Form 8038-T.
Form 8038—GC (Rev. 5.99)