HomeMy WebLinkAboutFishers Island Ferry DistrictJune 9, 2006
The Town Board of the
Town of Southold, in the
County of Suffolk, New York
Ladies and Gentlemen:
We have examined a record of proceedings relating to the issuance of the
$1,625,000 Bond Anticipation Note for Fishers Island Ferry District-2006 (the '%lote") of the
Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York.
The Note is dated June 9, 2006, matures June 8, 2007, subject to prior redemption, is payable to
bearer, is a single note in the denomination of $1,625,000, is numbered 3R-1, bears interest at the
rate of 3.70% per annum, is issued pursuant to the provisions of the Local Finance Law,
constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond
resolution adopted by the Town Board on July 31, 2001 and amended on October 21, 2003,
authorizing the issuance of $4,800,000 serial bonds for the increase and improvement of
facilities of the Fishers Island Fen~ District and the Certificate of Determination executed by the
Supervisor on June 9, 2006.
Said Bond Anticipation Note is a temporary obligation issued in anticipation of
the sale ofpermaner~ serial bonds.
In our opinion, the Note is a valid and legally binding general obligation of the
Town for which the Town has validly pledged its faith and credit and, unless paid fi.om other
sources, ali the taxable real property within the Town is subject to the levy of ad valorem real
estate taxes to pay the Note and interest thereon without limitation of rate or amount. The
enforceability of rights or remedies with respect to the Note may be limited by bankruptcy,
insolvency, or other laws affecting creditors' rights or remedies heretofore or hereafter enacted.
The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain
requirements that must be met subsequent to the issuance and delivery of the Note in order that
interest on the Note be and remain excludable from gross income under Section 103 of the Code.
The Supervisor of the Town, in executing the Arbitrage and Use of Proceeds Certificate, has
certified to the effect that the Town will comply with the provisions and procedures set forth
therein and that it will do and perform all acts and things necessary or desirable to assure that
interest paid on the Note is excludable from gross income under Section 103 of the Code. We
have examined such Arbitrage and Use of Proceeds Certificate of the Town delivered
concurrently with the delivery of the Note, and, in our opinion, such certificate contains
provisions and procedures under which such requirements can be met.
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In our opinion, the interest on the Note is excludable under existing statutes and
court decisions from the gross income of the recipients thereof for federal income tax purposes
pursuant to Section 103 of the Code, and under existing statutes interest on the Note will not be
treated as a preference item in calculating the alternative minimum tax that may be imposed
under the Code with respect to individuals and corporations. In rendering the foregoing opinion
we have assumed the Town's compliance with the Arbitrage and Use of Proceeds Certificate.
Further, in our opinion, under existing statutes, interest on the Note is exempt
from New York State and New York City personal income taxes.
Other than such record of proceedings, we have not been requested to examine or
review and have not examined or reviewed the accuracy or sufficiency of any additional
proceedings, reports, correspondence, financial statements or other documents, containing
financial or other information relative to the Town, which have been or may hereafter be
furnished or disclosed to purchasers of the Note and we express no opinion with respect to any
such financial or other information or the accuracy or sufficiency thereof.
The form of the Note is prescribed by Schedule B,2 of the Local Finance Law of
the State of New York, but we have not examined the executed Note.
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