Minutes 08/12/2003 - Laserfiche WebLink

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Au.qust 12, 2003 · The need for establishing this finance mechanism arises from the following: The major revenues of the City are received on a quarterly basis (real estate taxes) or annual basis (personal property taxes) while expenditures are occurring on a monthly basis; [] Social Services, Comprehensive Services as well as many grants must be funded by the City and are then reimbursed by the State; and [] The City's fund balance has not yet reached the level to ensure that sufficient cash flow is available throughout the fiscal year. · The issuance of a revenue anticipation finance mechanism will ensure that the City and the Schools meet their financial obligations in a timely manner by providing adequate cash flow (working capital). · The RAN or line of credit will become due on June 30, 2004 and will be payable from the future taxes and federal and state reimbursements. Financial Impact: · The interest rate charges are not expected to exceed 2.5%. The FY 2004 budget includes a line item for revenue anticipation interest expense. Motion by Mr. Moody, and seconded by Mr. Whitehurst, to adopt the following resolution, and was adopted by the following vote: "A RESOLUTION OF THE COUNCIL OF THE CITY OF PORTSMOUTH, VIRGINIA AUTHORIZING THE ISSUANCE AND SALE OF THE CITY'S REVENUE ANTICIPATION NOTE OR LINE OF CREDIT REVENUE ANTICIPATION NOTE. WHEREAS, the Council of the City of Portsmouth, Virginia (the "City") proposes to authorize the issuance of a revenue anticipation note or line of credit revenue anticipation note in the event it becomes necessary and advisable to borrow money in anticipation of the collection of the taxes and revenues of the City for the current year pursuant to Section 15.2-2629 of the Code of Virginia of 1950, as amended; NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Portsmouth, Virginia that: 1. Authorization of Note. The Council hereby authorizes the issuance and sale of the City's revenue anticipation note (the "RAN") or line of credit revenue anticipation note (the "LC-RAN" and together with the RAN, the "Note") in the maximum principal amount of $10,000,000 in anticipation of the collection of the taxes and revenues of the City for the current year. 2. Details and Sale of Note. The Note shall be issued upon the terms established pursuant to this Resolution and upon such other terms as may be determined in the manner set forth in this Resolution. The Note shall be issued in fully registered form, shall be dated the date of its issuance and delivery, shall be in the form of a single registered note and shall mature not later than one year from its date, subject to prepayment as set forth therein. The Chief Financial Officer of the City, or such officer as she may designate, is authorized and directed to accept a proposal for the purchase of the Note and to approve the terms of the Note, provided that the principal amount of the Note shall not exceed the amount set forth in paragraph 1, the Note shall mature not later than one year from its date and the interest rate on the Note if issued in the form of the RAN shall not exceed 2.50%. In the event that the City issues the Note in the form of the LC-RAN, the interest rate on each draw under the LC-RAN shall not exceed 2.50%.