15 Resolution authorizing agreement with First Southwest Asset Management, Inc.

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CITY COUNCIL AGENDA ITEM BRIEFING SHEET Submittal Date: Originating Department: Presented By: Agenda Item No.: 10-1-2008 Council Date: Finance Gene Anderson 15. 10-13-2008 RECOMMENDED MOTION: Motion to approve a resolution authorizing an agreement with First Southwest Asset Management, Inc. for arbitrage rebate compliance services; and authorizing the City Manager to negotiate and execute all necessary documents. POLICY ISSUE(S): Fiscal Management. In simplified terms, Section 148(f) (2&4) of the Internal Revenue Code requires that investment earnings on certain bonds, notes, certificates, and other tax-exempt obligations not exceed the actual amount of interest paid on those issues over the life of those obligations. To the extent investment earnings exceed interest payments, that amount must be forfeited to the Internal Revenue Service with certain exceptions allowed in the code. The actual calculation of potential arbitrage amounts can be complicated due to the nature of the IRS Code and the requirement that interest earned on related interest and sinking funds must also be considered. Besides making the actual calculations at the appropriate time intervals, First Southwest would also provide documented proof of the calculation in a format acceptable to the IRS. BOARD/COMMISSION RECOMMENDATION: NONE EXHIBITS: Resolution and agreement. ACTION: BUDGET INFO: ❑ Financial Report ❑ Minute Order Expense $0 ❑ Department Report ~ Resolution Budgeted Amt. $10,000 ❑ Presentation ❑ Ordinance y'I'D Actual $0 ❑ Public Hearing ❑ Other Acct. Name Consultants Acct. Number 01-0318-21-00 and 10-0318-81-00 FiscAL NoTES: None REVIEWED AND APPROVED BY: Z Administration Z City Clerk ❑ Communiry Development ❑ EMS/IT Z Finance ❑ Fire ❑ Municipal Court Z Legal ❑ Library ❑ Police ❑ Eng./Public Works ❑ Utilities City of Paris Revised 2/04/08 ° 000078