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Home My WebLink About55B - RESO WATER FUND PROJREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: MAY 7, 2019 TITLE: ADOPT RESOLUTION AND AUTHORIZE APPLICATION FOR DRINKING WATER STATE REVOLVING FUND CAPITAL PROJECT FINANCING AND ADOPT RESOLUTIONS FOR REIMBURSEMENT AND PLEDGED REVENUE AND FUNDS FOR THE WELL 32 NITRATE TREATMENT AND REHABILITATION PROJECT (NONGENERAL FUND) {STRATEGIC PLAN NO. 6, 1G} CITY MIANAGER RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 151 Reading ❑ Ordinance on 2nd Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER Adopt a Resolution agreeing to the terms of participation in the Environmental Protection Agency / California State Water Resources Control Board's Drinking Water State Revolving Fund Program for the Well 32 Nitrate Treatment and Rehabilitation project. 2. Authorize the Executive Director of Public Works to submit an application for Environmental Protection Agency / California State Water Resources Control Board's Drinking Water State Revolving Fund financing for the Well 32 Nitrate Treatment and Rehabilitation project. Adopt a Reimbursement Resolution and a Pledged Revenue and Funds Resolution required for participation in the California State Water Resources Control Board's Drinking Water State Revolving Fund program, pledging funds from any financing received through this program for the Well 32 Nitrate Treatment and Rehabilitation project and authorizing the reimbursement of expenditures for this project made prior to the receipt of such financing. DISCUSSION The City's potable water comes from an underground basin and is pumped through 21 existing wells. Well No. 32 is located at Morrison Park and has been inactive for about 10 years. The well was taken off line due to low operating efficiencies and high nitrate levels. Given the limited water supplies in the region and recent recurring droughts, rehabilitating Well No. 32 in order to put it back in service would improve the City's water system efficiency and reduce the burden on other water production facilities. 5513-1 Adopt Resolutions and Authorize Application for State Revolving Fund Capital Project Financing May 7, 2019 Page 2 The City completed a Well 32 Nitrate Mitigation and Rehabilitation study and has retained an engineering firm, who is preparing the construction documents for the Well No. 32 rehabilitation project. The construction cost for this project is estimated to be $5,290,000. The California State Water Resources Control Board (SWRCB) oversees a capital improvement financing program known as the Drinking Water State Revolving Fund (DWSRF) that provides low- cost flexible financing for capital improvements to water utilities. This program is more cost effective and requires less administrative burden than financing through bonds or certificates of participation. Funding can be secured on a shorter timeline and repaid more flexibly, subject to conditions of participation and competitive scoring criteria established and administered under the supervision of SWRCB. The three attached resolutions are needed to meet the State's application submittal requirements. Adopting these resolutions will allow the Well No. 32 project to benefit from a near-term infusion of cash to shorten the project delivery schedule and accelerate realization of service -level and financial benefits to the City and its enterprise ratepayers. STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal #6 - Community Facilities & Infrastructure, Objective #1 (establish and maintain a Community Investment Plan for all City assets), Strategy G (develop and implement the City's Capital Improvement Program in coordination with the Community Investment and Deferred Maintenance Plans. ENVIRONMENTAL IMPACT There is no environmental impact associated with this action. FISCAL IMPACT There is no fiscal impact associated with this action. Staff will return to Council with a request for appr I of further actions and will indicate the fiscal impact of any such awards and associated exp nd tures at that time. Fuad SA$weiss, PE, PLS Executi Director Public rks Agency Exhibits: 1. Authorization to Participate Resolution 2. Reimbursement Resolution 3. Pledge Revenues and Funds Resolution 55B-2 jmf 3/8/19 RESOLUTION NO. 2019 -XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA AUTHORIZING AN APPLICATION TO THE STATE WATER RESOURCES CONTROL BOARD FOR FINANCIAL ASSISTANCE FOR THE PLANNING, DESIGN, AND CONSTRUCTION OF THE WELL 32 NITRATE TREATMENT AND REHABILITATION PROJECT WHEREAS, the City of Santa Ana ("City") desires to finance the costs of constructing and/or reconstructing certain public facilities and improvements relating to its water and wastewater system, specifically the Well 32 Nitrate Treatment and Rehabilitation Project ("Project"); and WHEREAS, such financing is available through low interest moneys from the Drinking Water State Revolving Fund provided by the State of California, acting by and through the State Water Resources Control Board ("State Water Board"); and WHEREAS, the City, through appropriate staff, wishes to submit an application to the State Water Board for financial support of the Project. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Ana as follows: Section 1. The Executive Director of Public Works ("Authorized Representative"), or his or her designee, is hereby authorized and directed to sign and file, for and on behalf of the City, a Financial Assistance Application for a financing agreement from the State Water Board for the planning, design, and construction of the Project. Section 2. The Authorized Representative, or his or her designee, is designated to provide the assurances, certifications, and commitments required for the Financial Assistance Application, including executing a financial assistance agreement from the State Water Board and any amendments or changes thereto. Section 3. The Authorized Representative, or his or her designee, is designated to represent the City in carrying out the City's responsibilities under the financing agreement, including certifying disbursement requests on behalf of the City and compliance with applicable state and federal laws. Section 4. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. Resolution No. 2019-)00X EXHIBIT 1 Page 1 of 2 55B-3 jmf 3/8/19 ADOPTED this _ day of 2019. Miguel A. Pulido Mayor APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By: d 7i . -f-. John M. Funk Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, NORMA MITRE, Acting Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2019 -XXX to be the original resolution adopted by the City Council of the City of Santa Ana on 2019. Date: Acting Clerk of the Council City of Santa Ana 55B-4 Resolution No. 2019 -XXX Page 2 of 2 jmf 3/8/19 RESOLUTION NO. 2019 -XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA AUTHORIZING THE REIMBURSEMENT OF FUNDING FOR THE WELL 32 NITRATE TREATMENT AND REHABILITATION PROJECT FROM THE STATE WATER RESOURCES CONTROL BOARD WHEREAS, the City of Santa Ana ("City') desires to finance the costs of constructing and/or reconstructing certain public facilities and improvements relating to its water and wastewater system, specifically the Well 32 Nitrate Treatment and Rehabilitation Project ('Project"); and WHEREAS, the City intends to finance the construction and/or reconstruction of the Project or portions of the Project with moneys ('Project Funds') provided by the State of California, acting by and through the State Water Resources Control Board ("State Water Board"); and WHEREAS, the State Water Board may fund the Project Funds with proceeds from the sale of obligations the interest upon which is excluded from gross income for federal income tax purposes ("Obligations"); and WHEREAS, prior to the issuance of the Obligations or the approval by the State Water Board of the Project Funds, the City desires to incur certain capital expenditures ("Expenditures") with respect to the Project from available moneys of the City; and WHEREAS, the City has determined that those moneys to be advanced on and after the date hereof to pay the Expenditures are available only for a temporary period, and it is necessary to reimburse the City for the Expenditures from the proceeds of the Obligations. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Ana as follows: Section 1. The City hereby states its intention and reasonably expects to reimburse Expenditures paid prior to the issuance of the Obligations or the approval by the State Water Board of the Project Funds. Section 2. The reasonably expected maximum principal amount of the Project Funds is $5,290,000. Section 3. This Resolution is being adopted no later than 60 days after the date on which the City will expend moneys for the construction portion of the Project costs to be reimbursed with Project Funds. EXHIBIT 2 Resolution No. Page Pag1 of e 55B-5 jmf 3/8/19 Section 4. Each City expenditure will be of a type properly chargeable to a capital account under general federal income tax principles. Section 5. To the best of its knowledge, the City is not aware of the previous adoption of official intents by the City that have been made as a matter of course for the purpose of reimbursing expenditures and for which tax-exempt obligations have not been issued. Section 6. This Resolution is adopted as official intent of the City in order to comply with Treasury Regulation Section 1.150-2 and any other regulations of the Internal Revenue Service relating to the qualification for reimbursement of Project costs. Section 7. All the recitals in this Resolution are true and correct, and the City so finds, determines, and represents. Section 8. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. ADOPTED this day of 2019. APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By: K lit. 1~ , John M. Funk Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: NOT PRESENT: Councilmembers Councilmembers Miguel A. Pulido Mayor 55B-6 Resolution No. 2019 -XXX Page 2 of 3 jmf 3/8/19 CERTIFICATE OF ATTESTATION AND ORIGINALITY I, NORMA MITRE, Acting Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2019 -XXX to be the original resolution adopted by the City Council of the City of Santa Ana on 2019. Date: Acting Clerk of the Council City of Santa Ana 55B-7 Resolution No. 2019 -XXX Page 3 of 3 55B-8 jmf 3/8/19 RESOLUTION NO. 2019 -XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA PLEDGING REVENUES AND FUNDS FOR THE REPAYMENT OF FINANCING FROM THE STATE WATER RESOURCES CONTROL BOARD FORTHE WELL 32 NITRATE TREATMENT AND REHABILITATION PROJECT WHEREAS, the City of Santa Ana ("City") desires to finance the costs of constructing and/or reconstructing certain public facilities and improvements relating to its water and wastewater system, specifically the Well 32 Nitrate Treatment and Rehabilitation Project ("Project"); and WHEREAS, the City Council of the City of Santa Ana has previously authorized City staff to apply for financing of the construction and/or reconstruction of the Project or portions of the Project with low interest moneys from the Drinking Water State Revolving Fund, provided by the State of California, acting by and through the State Water Resources Control Board ("State Water Board"); and WHEREAS, the State Water Board requires, as a condition of approval of any financing agreement, the establishment of pledged sources of revenue to repay this financing. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Ana as follows: Section 1. The City of Santa Ana hereby dedicates and pledges the net revenues of the water enterprise fund and the water enterprise fund to payment of any and all Drinking Water State Revolving Fund and/or Water Recycling Funding Program financing for the Septic to Sewer Island Improvement Project. Section 2. The City commits to collecting such revenues and maintaining such fund(s) throughout the term of such financing and until the City has satisfied its repayment obligation thereunder unless modification or change is approved in writing by the State Water Board. Section 3. So long as the financing agreement(s) are outstanding, the City's pledge hereunder shall constitute a lien in favor of the State Water Board on the foregoing fund(s) and revenue(s) without any further action necessary. Section 4. So long as the financing agreement(s) are outstanding, the City commits to maintaining the fund(s) and revenue(s) at levels sufficient to meet its obligations under the financing agreement(s). EXHIBIT 3 Resolution No. 2013X)0( Page 1 of 2 55B-9 jmf 3/8/19 Section 5. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. ADOPTED this . day of 2019. Miguel A. Pulido Mayor APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By: Iw -f, John M. Funk Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, NORMA MITRE, Acting Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2019 -XXX to be the original resolution adopted by the City Council of the City of Santa Ana on 2019. Date: Acting Clerk of the Council City of Santa Ana 55B-10 Resolution No. 2019 -XXX Page 2 of 2