1983-01 RESOLUTION NO. 83- 01
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
GRAND TERRACE, CALIFORNIA, REQUESTING A DELAY BY
THE UNITED STATES CONGRESS IN THE IMPLEMENTATION
OF THE TAX EQUITY AND FISCAL RESPONSIBILITY ACT OF
1982 AS IT PERTAINS TO THE REQUIREMENT THAT, AS OF
JANUARY 1, 1983, ALL NEW MUNICIPAL BONDS MUST BE
ISSUED IN REGISTERED FORM TO PRESERVE THEIR TAX-
EXEMPT STATUS.
WHEREAS, the United States Congress recently passed the Tax Equity and
Fiscal Responsibility Act which provides that most municipal securities issued
after December 31, 1982, must be issued solely in registered form to. preserve
their tax-exempt status; and
WHEREAS, these provisions will necessitate significant changes in the ', I
practices of all participants in the municipal securities market,- to incl`ude-
the municipal securities industry, the issuer community, and investors. in
municipal securities; and
WHEREAS, if these provisions are implemented on January 1,- 1983, due.
to time constraints, the ability of municipalities to borrow much needed'
monies by the issuance of municipal bonds will be greatly reduced .or possibly
completely halted, since:
(1) Numerous State-law requirements must be ,changed to
permit the issuance of registered bonds to permit the
use of a local official as a transfer agent, to permit
the maintenance of an instate registry, to permit a
confidential bondholders list, to permit a book entry
accounting system, to permit contractual arrangements
with registered transfer agents and any other neces-
sary changes to comply with the new Federal law;
(2) necessary time-consuming changes to bond issuance
procedures will have to be developed by municipali-
ties, many of which will greatly increase their costs;
(3) municipal market participants have expressed the view
that the generalized adoption of book-entry or
immobilized delivery systems would help solve the
problems of clearing registered municipal securities,
and it would be virtually impossible to establish such
a system by January 1, 1983;
(4) the Secretary of the Treasury has not yet adopted
rules and regulations to implement the registration
provisions, and many questions remain unanswered; and
WHEREAS, due to numerous reasons, many municipalities are already
having fiscal problems, and the implementation of these provisions will
adversely affect these fiscal problems;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF GRAND TERRACE DOES
HEREBY RESOLVE its request that the United States Congress delay for a period
of two years the implementation of the Tax Equity and Fiscal Responsibility
Act of 1982 as it pertains to the requirement that, as of January 1, 1983, all
new municipal bonds must be issued in registered form to preserve their tax
exempt status; and
BE IT FURTHER RESOLVED that a copy of this Resolution be transmitted
to the United States Department of the Treasury and to both legislative bodies
of the United States Congress.
ADOPTED this 13th day of January, 1983.
ATTEST:
City,,-Cl6tk of the City o an ayor o f Ci two rand errace
Terrace and of the City Co ncil and of the C'iV Council thereof.
thereof.
Approved as to form: IL
r/� 2-
,ty Attorney
- 2 -
STATE OF CALIFORNIA )
COUNTY OF SAN BERNARDINO ) ss.
CITY OF GRAND TERRACE )
I, MYRNA ERWAY, City Clerk of the City of Grand Terrace, DO HEREBY
CERTIFY that the foregoing Resolution was duly adopted by the City Council of
said City at a regular meeting of the City Council held on the 13th day of
January, 1983, and that it was so adopted by the following vote:
AYES: Councilmembers Rigley, Petta, Nix, Pfennighausen;
Mayor Grant.
NOES: None.
ABSENT: None.
City C er the City of Gran errace-
and of the City Council thereof,
STATE OF CALIFORNIA )
COUNTY OF SAN BERNARDINO ) ss.
CITY OF GRAND TERRACE )
I, MYRNA ERWAY, City Clerk of the City of Grand Terrace, DO HEREBY
CERTIFY that the above and foregoing is a full , true, and correct copy of
Resolution No. 83-01 of said City, and that the same has not been amended or
repealed.
DATED: January 13, 1983.
Ci ty Cle rX o t e Ci ty of Gran errace
and of t e City Council ther-e�f = -