HomeMy WebLinkAbout1989-013-01/17/1989-REQUESTING THE CONGRESS AND EXECUTIVE BRANCH TO RESIST ANY EFFORTS TO REDUCE OR ABOLISH THE USE OF N RESOLUTION 89-13
OF THE COUNCIL OF THE CITY OF FORT COLLINS
REQUESTING THE CONGRESS AND EXECUTIVE BRANCH TO
RESIST ANY EFFORTS TO REDUCE OR ABOLISH THE USE OF NON-TAXABLE
BONDS AS A GOVERNMENTAL FINANCING TOOL
WHEREAS, the City of Fort Collins (the "City") along with federal ,
state, and local governments share in the responsibility of building and
maintaining the nation's physical and institutional infrastructure and in
providing essential services needed to promote the health, safety and
general welfare; and
WHEREAS, the federal government has steadily reduced and is expected
to continue reducing its support for infrastructure requirements thus
shifting more and more financial responsibility to states and units of
local government; and
WHEREAS, financing state and local government public projects through
the issuance of bonds the interest on which is not taxed by the government
is critical to allow states and local governments to exercise the
responsibilities entrusted to and expected of them; and
WHEREAS, in 1988 the U.S. Supreme Court overturned a 100-year-old
precedent, ruling for the first time that the Constitution does not
prohibit the federal government from taxing the interest on state and local
government bonds; and
WHEREAS, the Supreme Court decision has the potential to affect the
use of non-taxable bonds by the more than 85,000 units of local government,
as Congress seeks new sources of revenue to reduce the federal deficit; and
WHEREAS, since 1976 the City of Fort Collins has issued nearly
$154,000,000 in tax-exempt bonds for such essential community needs as
water and sewer treatment, parks and open space, construction of streets,
sidewalks, curbs, gutters and utility lines, stormwater runoff and
detention, and the revitalization of the historic downtown area; and
WHEREAS, it is estimated that loss of tax exempt financing would
increase the interest borne by such debt by 1.5 to 2.5 percent on any issue
which if applied to the City's present debt is an additional $2.3 million
to $3.8 million to be borne by the taxpayers; and
WHEREAS, special assessment bonds might not be marketable without
tax-exempt status which would hamper the City's ability to improve and
construct necessary infrastructure; and
WHEREAS, further restrictions on the use of non-taxable bonds for
legitimate public purpose will seriously impair the ability of the City and
all local governments to finance essential services, including electricity,
water, sewer, transit and other basic functions to the detriment of all
citizens.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that the City of Fort Collins calls upon the Congress and the
executive branch to recognize that the local burden of maintaining and
expanding the national infrastructure and providing citizens with needed
basic services must be met with non-taxable bonds, and to resist all
further efforts to reduce the use of such bonds to finance public
governmental projects.
Passed and adopted at a regular meeting of the Council of the City of
Fort Collins held this 17th day of January, A.D. 1989.
ASSIST
&ayvor
ATTEST:
City Clerk