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<br /> <br />ii. Current refunding bonds shall be utilized when present value savings of 3% of refunded <br />principal is achieved or in concert with other bond issues to save costs of issuance. <br />iii. Special assessment or revenue debt will not be refunded unless the finance director <br />determines special assessments or other sufficient revenues will not be collected soon <br />enough to pay off the debt fully at that call date. <br />d. The city shall use an outside bond attorney and an independent financial advisor to structure the <br />sale. <br /> <br />5. Debt Management Practices <br />a. Investment of bond proceeds shall be in a capital project fund. <br />b. Disclosure shall be in compliance with SEC rule 15(c)2(12) on primary and continuing <br />disclosure. Continuing disclosure reports shall be filed no later than 180 days after receipt of the <br />annual financial report. <br />c. Arbitrage Rebate Reports shall be completed for each issue no less than every five years after its <br />date of issuance. <br />d. Communication will include frequent and regular communications with bond rating agencies <br />about its financial condition and will follow a policy of full disclosure in every financial report <br />and bond prospectus. The city will comply with Securities Exchange Commission (SEC) <br />reporting requirements. <br /> <br />6. Post-Issuance Debt Compliance Policy <br />The city shall ensure all obligations are in compliance with all applicable state and federal regulations <br />and shall amend as necessary. <br />a. Background - The Internal Revenue Service (IRS) is responsible for enforcing compliance <br />with the Internal Revenue Code and related regulations governing certain obligations (ex: <br />tax-exempt obligations, Build America Bonds, Recovery Zone Development Bonds and <br />various tax credit bonds). The IRS expects issuers and beneficiaries of these obligations to <br />adopt and implement a post-issuance debt compliance policy and procedures to safeguard <br />against post-issuance violations. <br />b. Policy Objective - The city desires to monitor these obligations to ensure compliance with <br />the IRS Code and related regulations governing such obligations. To ensure compliance, <br />the Post-Issuance Debt Compliance Policy shall apply to the obligations mentioned above, <br />including bonds, notes, loans, lease purchase contracts, lines of credit, commercial paper or <br />any other form of debt that is subject to compliance. <br /> <br />The finance director is the designated agent responsible for post-issuance compliance. However, to the <br />extent obligations are issued for municipal utility purposes, the finance director/office manager of <br />ERMU assumes the duties of post-issuance debt compliance as described in this policy instead of the <br />finance director. <br />The finance director shall assemble all relevant documentation, records and activities required to <br />ensure compliance as further detailed. At a minimum, the Post-Issuance Debt Compliance Procedures <br />for each qualifying obligation will address the following: <br />i. General post-issuance compliance; <br />ii. Proper and timely use of bond proceeds and bond-financed property; <br />iii. Arbitrage yield restriction and rebate; <br />iv. Timely filings and other general requirements; <br />v. Additional undertakings or activities that support points 1 through 4 above; <br />vi. Other requirements as necessary in the future. <br />Financial Management Policies Page 9 <br /> <br />