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Reso 1672 06/2024RESOLUTION NO. 1672 RESOLUTION OF THE BOARD OF DIRECTORS OF THE VALLECITOS WATER DISTRICT DECLARING ITS INTENTION TO ISSUE TAX-EXEMPT OBLIGATIONS WHEREAS, the Vallecitos Water District (the "Issuer"), a public agency duly organized and existing under and by virtue of the laws of the State of California, desires to finance the costs of certain capital improvements as provided in Exhibit A attached hereto and incorporated herein (the "Project"); WHEREAS, the Issuer intends to finance the Project or portions of the Project with the proceeds of obligations the interest upon which is excluded from gross income for federal income tax purposes (the "Obligations"); and WHEREAS, prior to the incurrence of the Obligations the Issuer desires to incur certain expenditures with respect to the Project from available monies of the Issuer which expenditures are desired to be reimbursed by the Issuer from a portion of the proceeds of the sale of the Obligations. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Vallecitos Water District as follows: Section 1. The Board of Directors of the Vallecitos Water District finds and determines that the foregoing recitals are true and correct. Section 2. The Issuer hereby states its intention and reasonably expects to reimburse Project costs incurred prior to the incurrence of the Obligations with proceeds of the Obligations. Exhibit A describes either the general character, type, purpose, and function of the Project, or the fund or account from which Project costs are to be paid and the general functional purpose of the fund or account. Section 3. The reasonably expected maximum principal amount of the Obligations is $245,514,000. The amount of proceeds of the Obligations reasonably expected to be allocated to expenditures to reimburse expenditures incurred prior to the issuance of the Obligations is $245,514,000. Section 4. This Resolution is being adopted not later than 60 days after the date (the "Expenditures Date or Dates") that the Issuer will expend monies for the portion of the Project costs to be reimbursed from proceeds of the Obligations. Section 5. Except as described below, the expected date of issue of the Obligations will be within eighteen months of the later of the Expenditure Date or Dates and the date the Project is placed in service; provided, the reimbursement may not be made more than three years after the original expenditure is paid. For Obligations subject to the small issuer exception of Section 148(f)(4)(D) of the Internal Revenue Code, the "eighteen -month limit" of the previous sentence is changed to "three years" and the limitation of the previous sentence beginning with "; provided, .. . " is not applicable. Section 6. Proceeds of the Obligations to be used to reimburse for Project costs are not expected to be used, within one year of reimbursement, directly or indirectly to pay debt service with respect to any obligation (other than to pay current debt service coming due within the next Resolution No. 1672 Page 2 succeeding one year period on any tax exempt obligation of the Issuer (other than the Obligations)) or to be held as a reasonably required reserve or replacement fund with respect to an obligation of the Issuer or any entity related in any manner to the Issuer, or to reimburse any expenditure that was originally paid with the proceeds of any obligation, or to replace funds that are or will be used in such manner. Section 7. This Resolution is consistent with the budgetary and financial circumstances of the Issuer, as of the date hereof. No monies from sources other than the Obligation issue are, or are reasonably expected to be reserved, allocated on a long-term basis, or otherwise set aside by the Issuer (or any related party) pursuant to their budget or financial policies with respect to the Project costs. Section 8. The limitations described in Section 3 and Section 4 do not apply to (a) costs of issuance of the Obligations, (b) an amount not in excess of the lesser of $100,000 or five percent (5%) of the proceeds of the Obligations, or (c) any preliminary expenditures, such as architectural, engineering, surveying, soil testing, and similar costs other than land acquisition, site preparation, and similar costs incident to commencement of construction, not in excess of twenty percent (20%) of the aggregate issue price of the Obligations that finances the Project for which the preliminary expenditures were incurred. Section 9. This Resolution is adopted as official action of the Issuer in order to comply with Treasury Regulation § 1.150-2 and any other regulations of the Internal Revenue Service relating to the qualification for reimbursement of Issuer expenditures incurred prior to the date of issue of the Obligations, is part of the Issuer's official proceedings, and will be available for inspection by the general public at the main administrative office of the Issuer. This declaration does not bind the District to make any expenditure, incur any indebtedness, or proceed with the projects. This Resolution shall take effect immediately. PASSED, APPROVED AND ADOPTED by the Board of Directors of the Vallecitos Water District at a regular meeting held on this 5th day of June, 2024, by the following roll call vote: AYES: ELITHARP, GROSET, HERNANDEZ, PENNOCK NOES: ABSTAIN: ABSENT: BOYD-HODGSON , Ja Pennock, Vice -President ralle rd of Directors citos Water District ATTEST: 4afmGumpel, Secret oard of Directors Vallecitos Water District EXHIBIT A DESCRIPTION OF PROJECT Capital improvements to the District's water and wastewater systems including, but not limited to, the projects identified in the Comprehensive Project List included on pages 35 and 36 of the approved Budget for Fiscal Year 2024/2025.