HomeMy WebLinkAboutRES 341 Draft 01 2008-2010 7 ; 0 ,17 ;9! x.4'•
COUNTY OF HAWAII ; 6- "5`'/ • STATE OF HAWAII
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RESOLUTION NO. 341 10
RESOLUTION AUTHORIZING THE CREATION OF A RECOVERY ZONE UNDER
THE PROVISIONS OF THE AMERICAN RECOVERY AND REINVESTMENT ACT
OF 2009 FOR THE PURPOSE OF ISSUING RECOVERY ZONE ECONOMIC
DEVELOPMENT BONDS; DESIGNATION OF THE LOCAL SUBALLOCATION OF
THE VOLUME CAP WITH RESPECT TO THE RECOVERY ZONE ECONOMIC
DEVELOPMENT BONDS TO GENERAL OBLIGATION BONDS OF THE COUNTY
OF HAWAII.
WHEREAS, Section 1401 of Title I of Division B of the American Recovery and
Reinvestment Act of 2009, Pub. L. No. 111 -5, 123 Stat. 115 (2009) ( "ARRA "), added Sections
1400U -1 through 1400U -3 to the Intemal Revenue Code of 1986 (the "Code "), authorizing state
and local governments to issue recovery zone economic development bonds ( "Recovery Zone
Economic Development Bonds "); and
WHEREAS, Recovery Zone Economic Development Bonds may be issued by each state
and counties and large municipalities within each state before January 1, 2011 under § 1400U -2
of the Code, as provided in § 1400U -1 of the Code, to finance certain "qualified economic
development purposes" for use within designated "recovery zones," as described; and
WHEREAS, for purposes of § 1400U -1 and § 1400U -2 of the Code, the term "recovery
zone" means: (1) any area designated by the issuer as having significant poverty, unemployment,
rate of home foreclosures, or general distress; (2) any area designated by the issuer as
economically distressed by reason of the closure or realignment of a military installation
pursuant to the Defense Base Closure and Realignment Act of 1990; and (3) any area for which a
designation as an empowerment zone or renewal community is in effect as of the effective date
of ARRA, which effective date is February 17, 2009; and
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WHEREAS, § 1400U -2(c) of the Code defines the term "qualified economic development
purpose" for purposes of § 1400U -2 of the Code to mean any expenditures for purposes of
promoting development or other economic activity in a recovery zone, including (1) capital
expenditures paid or incurred with respect to property located in the recovery zone,
(2) expenditures for public infrastructure and construction of public facilities, and
(3) expenditures for job training and educational programs; and
WHEREAS, eligible issuers of Recovery Zone Economic Development Bonds include
states and political subdivisions as defined for purposes of § 103 of the Code; and
WHEREAS, §1400U -1(b) of the Code requires, in part, that issuers "designate" eligible
recovery zones based on certain specified criteria; and
WHEREAS, I.R.S. Notice 2009 -50 ( "Notice 2009 -50 ") provides that for this purpose,
any state, county, or large municipality that receives a volume cap allocation for Recovery Zone
Economic Development Bonds may make these designations of recovery zones in any
reasonable manner as it shall determine in good faith in its discretion; and
WHEREAS, due to a significant decline in tourism and economic conditions generally,
the County of Hawai`i (the "County ") has suffered significant general economic distress; and
WHEREAS, §1400U-1(a)(1)(A) of the Code provides that, subject to § 1400U- 1(a)(1)(B)
of the Code (relating to minimum allocations), generally, the Secretary of the Treasury shall
allocate the $10 billion national volume cap for Recovery Zone Economic Development Bonds
among the states in the proportion that each state's 2008 state employment decline bears to the
aggregate of the 2008 State employment declines for all of the States; and
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WHEREAS, § 1400U- 1(a)(3)(A) of the Code provides generally that each state with
respect to which an allocation is made under § 1400U- 1(a)(1) of the Code is required, without
discretion, to reallocate such allocation among the counties and large municipalities in such state
in the proportion that each county's or municipality's 2008 employment decline bears to the
aggregate of the 2008 employment declines for all the counties and municipalities in such state
(the "Volume Cap "); and
WHEREAS, pursuant to Notice 2009 -50, the Department of Treasury ( "Treasury ") and
the Internal Revenue Service undertook to determine these required local suballocations of
Volume Cap; and
WHEREAS, pursuant to Notice 2009 -50, the local suballocation of volume cap
determined by the Treasury to apply to the County is $24,678,000;
NOW, THEREFORE, BE IT RESOLVED by the Council of the County of Hawaii as
follows:
1. The Council of the County hereby finds that the entire geographic area of the
County is experiencing significant poverty, unemployment, rate of home
foreclosures, or general distress for purposes of § 1400U -1(b) of the Code.
2. The entire geographic area of the County is hereby designated as a recovery zone
for purposes of § 1400U -1(b) of the Code.
3. The $24,678,000 representing the local suballocation of Volume Cap determined
by the Treasury to apply to the County is hereby allocated to the County's general
obligation bonds authorized by the Council of the County to fund public
infrastructure and public facilities (the "County Bonds ").
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4. The Council of the County hereby finds that the projects to be financed by the
County Bonds will promote development or other economic activity in such
recovery zone and will constitute capital expenditures paid or incurred with
respect to property located in the recovery zone and expenditures for public
infrastructure and construction of public facilities.
BE IT FURTHER RESOLVED that the Clerk be and is directed to transmit copies of this
resolution to the Director of Finance of the County.
Dated at Hilo , Hawai`i, this 19th day of May , 2010.
INTRODUCED BY:
COUNCIL MEMBER, COUNTY OF HAWAII
COUNTY COUNCIL ROLL CALL VOTE
County of Hawai`i AYES NOES ABS EX
Hilo, Hawai`i ENRIQUES X
FORD X
I hereby certify that the foregoing RESOLUTION was by GREENWELL X
the vote indicated to the right lU
hereof teed by the COUNCIL of the HOFPMANN X
County of Hawai`i on aY
IKEDA X
NAEOLE X
ATTEST: ONISHI X
YAGONG X
YOSHIMOTO X
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�1 Il i Reference: C- 821 /Waived FC
COUNTY CLERK CHAIRPERSON & PRESIDING OFFICER RESOLUTION NO. 341 10
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