CITY OF NORTH LAUDERDALE

PUBLIC WORKS DEPARTMENT

 

TO:                 Honorable Mayor and City Commission

 

FROM:           Richard D. Sala, City Manager

 

BY:                  Michael Shields, Public Works Director

Dana Spencer, Grants Administrator

 

DATE:            November 13, 2007

 

SUBJECT:     State Revolving Fund Program for Water Treatment Plant Upgrades

 

Background

 

The City of North Lauderdale’s Water Treatment Plant is 30 years old and is in need of a complete renovation.  Therefore, the Public Works Department has been working with US Waters Corporation and Calvin Giordano & Assoc., the City’s Engineering Consultants, to develop a comprehensive retrofitting plan pertaining to water plant renovations. The cost of these renovations is expected to be approximately $5 million dollars.  Items included in this renovation plan are listed below:

 

1)      Purchase and installation of a Supervisory Control and Data Acquisition (SCADA) system and changing of filters.  (approx. $2.5 million)

 

2)      Hardening of the Water Plant to promote Emergency Management and heightened security. (approx. $2 million)

 

3)      Painting of the entire facility. (approx. 500k)

 

We strongly believe that this retrofitting project will benefit the City and its residents in the following ways:

 

§         Ensure safe and reliable potable water supply

§         Extend the overall facility life

§         Reduce electrical power and chemical consumption

§         Improve monitoring efficiency and flow proportionate pacing of chemicals

§         Improve water quality through better control and monitoring,

§         Reduce operating cost by reducing manpower requirements and increase system reliability

§         Reduce the need for emergency maintenance related repairs

§         Provide remote monitoring for the site

§         Improve working conditions for personnel related to safety and ergonomics

 

Along with identifying the renovations needed, the City’s goal is to finance these renovations in a most cost effective manner. Keeping this goal in mind, the City explored the option of conventional financing through a bank, as well as the Florida Department of Environmental Protection (FDEP) Water Facilities State Revolving Fund Program (SRF).   In this regard, the City sent its Grants Administrator to a workshop offered by FDEP regarding this program. Subsequently, the Grants Administrator submitted an application requesting that the City of North Lauderdale be included on FDEP’s list of eligible projects.  Historically, water treatment plant renovations have been considered by FDEP as viable projects worthy of funding.

 

Details of this Program are listed below:

 

Florida Department of Environmental Protection State Revolving Fund Program

 

The Drinking Water State Revolving Fund (SRF) Program provides low-interest loans to eligible entities for planning, designing, and constructing public water facilities. Federal and State appropriations have funded the SRF. It is a "revolving" fund because loan repayments are used to make additional loans. Funds are made available for construction loans of $75,000 or more. The loan terms include a 20-year amortization and low-interest rates.

 

Some of the advantages of receiving funding from the SRF are as follows:

 

            1)         The Annual Percentage Interest Rate for the SRF is currently at 2.75%. The Annual Percentage Interest rate offered by SunTrust Bank for the same amount of money to borrow is 4.65%.  (This rate was iterated in a commitment letter from SunTrust secured by the Finance Department).  The reflected saving by choosing the APR of 2.75% as opposed to 4.65% is approximately $1.2 million.

 

            2)         The loan terms include a 20 Year Amortization. Under this option, the City will have to pay approximately $327k per year, whereas under conventional financing this payment could be as high as $400k.

 

            3)         The starting date for repayment of the SRF loan does not begin right away, as opposed to conventional banking methods.  With a conventional bank, repayment begins immediately upon signing and the terms are rarely dictated by the borrower. Repayment of the SRF does not start until six months after project work is completed.

 

            4)         The Public Works Director can commence construction activities and begin to incur costs towards reimbursement upon approval of the Water Facilities Plan and receipt of the approval letter from DEP.

 

            5)         The City can approach DEP to add on additional phases if more money is needed to finish the project.

 

In order to proceed with this program, the City is required to conduct the following activities that are very technical in nature.

 

1)      Development of Water Facilities Plan

2)      Facilitating through the SRF Clearinghouse.

 

The City’s Consultant, Calvin Giordano & Assoc. Inc., has the expertise to provide these activities and has submitted a proposal detailing the expenditure of $60,000 to complete the submission process on City’s behalf. The funds for this service will come from the Utilities Fund 401-3939-531400; Architects and Engineers.

 

Recommendation:

 

The City Administration recommends Commission’s consideration and approval of the attached Resolution authorizing and directing the City Manager to take all steps necessary to submit an application to the Florida Department Of Environmental Protection State Revolving Fund Program in an amount not to exceed $5,000,000 for the Water Plant renovations and to retain the services of Calvin Giordano & Associates, under the City’s continuing contract, to compile the documents necessary to apply for this revolving fund program in an amount not to exceed $60,000.

 

 

RESOLUTION 2007--____

 

A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF NORTH LAUDERDALE, FLORIDA, AUTHORIZING AND DIRECTING THE CITY MANAGER TO TAKE ALL STEPS NECESSARY TO SUBMIT AN APPLICATION TO THE FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION STATE REVOLVING FUND PROGRAM IN AN AMOUNT NOT TO EXCEED $5,000,000 TO PROVIDE FUNDING TOWARDS REFURBISHMENT OF THE CITY’S WATER TREATMENT PLANT AND TO RETAIN THE SERVICES OF CALVIN GIORDANO & ASSOCIATES, UNDER THE CITY’S CONTINUING CONTRACT, TO COMPILE  THE DOCUMENTS NECESSARY TO APPLY FOR THIS REVOLVING FUND PROGRAM IN AN AMOUNT NOT TO EXCEED $60,000; PROVIDING FOR FINDINGS AND CONCLUSIONS WITH REGARD TO THE BENEFITS TO BE DERIVED BY APPLYING FOR SUCH FUNDING; PROVIDING FOR CONFLICTS; PROVIDING FOR SEVERABILITY; PROVIDING FOR AN EFFECTIVE DATE.

 

            WHEREAS, the City Commission of the City of North Lauderdale (“City”) recognizes the importance of upgrading the aging water plant that will add to the efficiency, aesthetics, and heightened security ; and the mission of the Florida Department of Environmental Protection’s State Revolving Fund Loan Program (SRF)

           

WHEREAS, in order to enhance the City of North Lauderdale and provide up-to-date monitoring of the City’s Water Plant in keeping with the mission and goals of the Florida Department of Environmental Protection the City Commission desires to continue pursuing funds from the State Revolving Fund Program under the  Florida Department of Transportation (“FDEP”); and

           

WHEREAS, the City Commission recognizes the City’s contracted services provider; Calvin Giordano Associates.  Calvin Giordano Associates proposes to perform the following work: 1) Develop Water Facilities Plan; and, 2) provide assistance in facilitating through the SRF clearing house. 

           

WHEREAS, the City Commission finds that the receipt of the grant funds from the FDEP SRF will be in the best interest of the health, safety and welfare of the citizens and residents of the City of North Lauderdale.

           

            NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of North Lauderdale, Florida, that:

 

            Section 1.        The foregoing “Whereas” clauses are hereby ratified and confirmed as being true and correct and are hereby made a specific part of this Resolution upon adoption hereof.

 

            Section 2.        That the City Manager be and the same is hereby authorized and directed to apply to the Florida Department of Environmental Protection State Revolving Fund Loan Program for funding in an amount not to exceed $5 million dollars (5,000,000) in order to provide needed funding in order to renovate and enhance the Water Treatment Plant.

 

            Section 3.        That the City Manager be and the same is hereby authorized and directed to accept Calvin Giordano & Assoc. proposal of $60,000 in order to compile necessary engineering documents needed to apply to the Florida Department of Environmental Protection State Revolving Fund Loan Program. Funding for this service will be taken from Utilities Fund 401-3939-531400, Architects and Engineers.

 

            Section 4.        That the CITY COMMISSION finds and determines that it is in the best interest of the citizens and residents of the City of North Lauderdale, Florida, to apply for said opportunity with the Florida Department of Environmental Protection.

 

            Section 5.        The proper officers of City of North Lauderdale be, and each of them hereby is, authorized and directed to execute and deliver any and all papers, instruments, opinions, certificates, affidavits and other documents and to do or cause to be done any and all other acts and things necessary or proper for carrying out this resolution.

 

            Section 6.        All resolutions or parts of resolutions in conflict herewith are hereby repealed to the extent of such conflict.

 

            Section 7.        If any clause, section, other part or application of this Resolution is held by any court of competent jurisdiction to be unconstitutional or invalid, in part or application, it shall not affect the validity of the remaining portions or applications of this Resolution.

 

            Section 8.        That this resolution shall take effect immediately upon adoption.

 

            PASSED AND ADOPTED by the CITY COMMISSION of the City of North Lauderdale, Florida this 13th day of November, 2007.

 

 

APPROVED AS TO FORM:

 

__________________________________

SAMUEL S. GOREN, CITY ATTORNEY

 

___________________________________

MAYOR JACK BRADY

 

 

___________________________________

VICE MAYOR RICH MOYLE

 

 

ATTEST:

 

 

_______________________________

PATRICIA VANCHERI, ACTING CITY CLERK