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Home My WebLink About55E - RESO - METER INFRASTRUCTUREREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: OCTOBER 15, 2019 TITLE: ADOPT RESOLUTIONS AUTHORIZING APPLICATION AND REIMBURSEMENT FOR DRINKING WATER STATE REVOLVING FUND CAPITAL PROJECT FINANCING FOR THE ADVANCED METER INFRASTRUCTURE PROJECT (NONGENERAL FUND) {STRATEGIC PLAN NO. 6, 1G} /s/ Kristine Ridge CITY MANAGER d xd•LTA I LTA 121 ki 11111 A r1VA" I Eel ki CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 1" Reading ❑ Ordinance on 2111 Reading ❑ Implementing Resolution ❑ Set Public Hearing For FILE NUMBER 1. Adopt a Resolution authorizing the City Manager to submit an application for Environmental Protection Agency/California State Water Resources Control Board's Drinking Water State Revolving Fund financing for the Advanced Meter Infrastructure Project and sign all subsequent financial assistance agreements documents. 2. Adopt a Resolution authorizing the reimbursement of funding for the Advanced Meter Infrastructure Project from the State Water Resources Control Board. DISCUSSION The City of Santa Ana provides potable water for all of the City's businesses and residents. The City charges for water used by these customers via traditional mechanical meters that must be read manually. The City is in the planning and design stages of the Advanced Meter Infrastructure (AMI) Project. The proposed AMI Project involves, among other things, the transition of approximately 45,000 existing manual -read meters to new smart meters that communicate via radio or similar technology and enable the City to implement technological enhancements such as automated meter reads, leak detection and usage notifications, and interactive customer portals. By upgrading to an AMI system, customers can be supplied with on -demand, real-time water consumption data, enabling them to make more informed decisions about their water use. Case studies have shown that communities that upgrade to AMI systems can achieve water consumption savings of up to 15 percent. In 2016, the City completed an AMI feasibility study to evaluate the applicability and costs associated with an AMI project. The feasibility study estimated the cost of fully deploying this project at approximately $14,400,000. To date, the City has secured partial financing from two grants for the AMI project for a total of $4,300,000. The first is a $4,000,000 grant from the State's General Fund Specified Grant Projects account and the second is a $300,000 Bureau of 55E-1 Adopt Resolutions and Authorize Applications for State Revolving Fund Capital Project Financing for the AMI Project October 15, 2019 Page 2 Reclamation WaterSMART grant. Financial assistance in the amount of $10,117,365 is proposed from the Drinking Water State Revolving Fund to support the replacement of the manual -read meters with AMI technologies. This would allow the City to upgrade the water metering process, including AMI installation, facilities construction, materials and equipment (registers, meters, meter boxes, lids, software, hardware, AMI tower materials), Meter Data Management System (MDMS), leak detection technologies, interactive web portal installation, as well as pressure -monitoring capabilities. The California State Water Resources Control Board (SWRCB) oversees the Drinking Water State Revolving Fund which is a low-cost flexible financing for capital improvements to water utilities. This financing program is more cost effective and requires less administrative burden than financing through bonds or certificates of participation, and 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. Adoption of the resolutions would allow the AMI Project to benefit from a near -term infusion of cash that will shorten its respective project delivery schedule and accelerate realization of service -level and financial benefits to the City and its enterprise ratepayers. The two resolutions referenced in this Council Action are needed to meet the State's requirements. 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 approval of further actions and will indicate the fiscal impact of any such awards and associated expenditures at that time. Fuad Sweiss, PE, PLS Executive Director Public Works Agency FS/NS/RR Exhibits: 1. Authorization to Participate Resolution 2. Reimbursement Resolution 55E-2 EXHIBIT 1 jmf 10/9/19 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 AUTOMATED METER INFRASTRUCTURE 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 Automated Meter Infrastructure Project ("AMI 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 City Manager ("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 AMI 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. Resdution No. 2019-XXX Page 1 of 2 55E-3 jmf 10/9/19 ADOPTED this day of 2019. Miguel A. Pulido Mayor APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By: 7�'. -f. L John M. Funk Assistant City Attorney AYES: Councilmembers NOES: Councilmembers /G1*II/91►�00T@vM, I1 1i1T=1 NOT PRESENT: Councilmembers Is] =I:491 y 197e'ltl41012e'llam*3filI IQ Je1.I exelN N I Jet I k!'1 I, DAISY GOMEZ, 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 12019. Date: Clerk of the Council City of Santa Ana Resdution No. 2019-XXX Page 2 of 2 55E-4 jmf 9/28/19 RESOLUTION NO. 2019-XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA AUTHORIZING THE REIMBURSEMENT OF FUNDING FOR THE AUTOMATED METER INFRASTRUCTURE PROJECT FROM THE STATE WATER RESOURCES CONTROL BOARD WHEREAS, the City of Santa Ana ("Agency") desires to finance the costs of constructing and/or reconstructing certain public facilities and improvements relating to its water and wastewater system, including specifically the Automated Meter Infrastructure Project ("Project'); and WHEREAS, the Agency 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 Agency desires to incur certain capital expenditures ("Expenditures") with respect to the Project from available moneys of the Agency; and WHEREAS, the Agency 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 Agency 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 Agency 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 $10,117,365. Section 3. This Resolution is being adopted no later than 60 days after the date on which the Agency will expend moneys for the construction portion of the Project costs to be reimbursed with Project Funds. Resdution No. 2019-XXX Page 1 of 3 EXHIBI66 E -5 jmf 9/28/19 Section 4. Each Agency expenditure will be of a type properly chargeable to a capital account under general federal income tax principles. Section 5. To the best of our knowledge, this Agency is not aware of the previous adoption of official intents by the Agency 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 Agency 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 this Agency 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 12019. APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By:, John M. Funk Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers Miguel A. Pulido Mayor Resdution No. 2019-XXX Page 2 of 3 55E-6 jmf 9/28/19 CERTIFICATE OF ATTESTATION AND ORIGINALITY I, DAISY GOMEZ, 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 12019. Date: Clerk of the Council City of Santa Ana Resdution No. 2019-XXX Page 3 of 3 55E-7 55E-8