Minutes 10/23/2001 - Laserfiche WebLink

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October 23, 2001 WHEREAS, in lieu of receiving all or a portion of periodic interest payments from the issuer, an eligible holder of a QZAB receives a federal income tax credit for each year the QZAB is outstanding; and WHEREAS, the federal income tax credits provided by Section 1397E of the Tax Code are designed to compensate the QZAB holder for lending money to the issuer and to function as payments of interest on the QZAB, and the intent of the federal tax credits is to permit the QZAB to be issued with little or no stated interest or original issue discount; and WHEREAS, Section 1397E of the Tax Code sets forth a number of certification and similar requirements to be satisfied for a valid issuance of QZABs, including, without limitation, the following: A requirement that 95 percent of the proceeds of a QZAB issue be used for a qualified purpose with respect to a qualified zone academy established by an eligible local education agency; A requirement that the QZAB issuer certify that it has written assurances that the private business contribution requirement of Section 1397E(d)(2) of the Tax Code will be met with respect to the academy; and A requirement that the eligible local education agency specify the type and quality of contributions from private entities acceptable to be counted as "qualified contributions" for purposes of the private business contribution requirement; and WHEREAS, for purposes of this resolution: The term "qualified purpose" means, with respect to any qualified zone academy, (i) rehabilitating or repairing the public school facility in which the academy is established, and (ii) providing equipment for use at such academy. The term "qualified zone academy" means any public school (or academic program within a public school) that is established by and operated under the supervision of an eligible local education agency to provide education or training below the post-secondary level if: such public school or program (as the case may be) is designed in cooperation with business to enhance the academic curriculum, increase graduation and employment rates, and better prepare students for the rigors of college and the increasingly complex workforce; students in such public school or program (as the case may be) will be subject to the same academic standards and assessments as other students educated by the eligible local education agency; the comprehensive education plan of such public school or program is approved by the eligible local education agency; and such public school is located in an empowerment zone or enterprise community or a certain percentage of the students attending such school or participating in such program (as the case may be) will be eligible for free or reduced-cost lunches under the school lunch program established under the Richard B. Russell National School Lunch Act. The term "eligible local education agency" means any local education agency as defined in section 14101 of the Elementary and Secondary Education Act of 1965, and legal counsel has advised that the Portsmouth School Board (the "School Board") is the eligible local education agency for the City of Portsmouth, Virginia ("Portsmouth"); and WHEREAS, the private business contribution requirement is met with respect to any issue of QZABs if the eligible local education agency that established the qualified zone academy has written commitments from private entities to make qualified contributions having a present value (as of the date of issuance of the issue) of not less than 10 percent of the proceeds of the issue; and WHEREAS, under Section 1397E of the Tax Code, the Commonwealth of Virginia has available in calendar year 2001 approximately $9,900,000 in QZAB issuing capacity to be allocated to qualified zone academies within the Commonwealth of Virginia; and