This Section will apply to an issue of Notes only to the extent specifically adopted in a Note Resolution. By adoption of a Note Resolution, the County will covenant that it will take those actions required to maintain the Federal Tax Status on the Notes and that it will not take or permit to be taken any actions that would adversely affect that Federal Tax Status. Without limiting these covenants, the County will specifically covenant as follows:
(a) Private Activity Bonds. The County will apply the proceeds received from the sale of the Notes to pay costs of the Projects or, for renewal notes, to pay Debt Service on the maturing notes, and to pay the Financing Costs in connection with the Notes. The County will not permit the use of the Projects by any person, will not secure or derive the money for payment of Debt Service on the Notes by any property or payments, and will not loan the proceeds of the Notes to any person, all in a manner as to cause the Notes to be "private activity bonds" within the meaning of Code Section l41(a).
(b) Arbitrage. The County will restrict the use of proceeds of the Notes in the manner and to the extent as may be necessary, after taking into account reasonable expectations at the time of the delivery of and payment for the Notes, so that the Notes will not constitute "arbitrage bonds" within the meaning of Code Section 148. The Authorized Officer or any other official having responsibility for issuing the Notes, is authorized and directed, alone or in conjunction with any other officer, employee, or consultant of the County, to sign and deliver a certificate of the County, for inclusion in the transcript of proceedings for the Notes, setting forth the reasonable expectations of the County on the Closing Date, regarding the amount and use of the proceeds of the Notes in accordance with Code Section 148. If required, the County will limit the yield on any "investment property" (as defined in Code Section l48(b)(2)) acquired with the proceeds of the Notes.
(c) Arbitrage Rebate. Unless the gross proceeds of the Notes are expended in accordance with one of the spending period exceptions set forth in Treas. Reg. § 1.148-7, the County will pay the amounts required by Code Section 148(f)(2) to the United States at the times required by Code Section 148(f)(3). The County will maintain the books and records and make the calculations and reports that are required to comply with the Code's arbitrage rebate requirements.
(d) Federal Guarantee. The County will not permit the use of the Projects, or make loans of the proceeds of the Notes, or invest the proceeds of the Notes in a manner as to cause the Notes to be "federally guaranteed" within the meaning of Code Section 149(b).
(e) Information Reporting. The Authorized Officer or any other official of the County having responsibility for issuing the Notes shall sign and file a Form 8038-G for the Notes with the Internal Revenue Service.
(f) Bank-Qualified Obligations. Each Note Resolution will determine if an issue of Notes constitutes a "qualified tax-exempt obligation" for the purposes of Code Section 265(b)(3).
(Ord. 2009-139. Adopted 4-13-09.)