HomeMy WebLinkAboutResolution No. 06-C1010 0
RESOLUTION NO. 06-C 101
A RESOLUTION OF THE UTILITY BOARD AND CITY COUNCIL OF
THE CITY OF AZUSA, APPROVING THE FINANCIAL PLAN FOR
THE NEW WATER TREATMENT PLANT AND OTHER WATER
FACILITIES.
WHEREAS, the City of Azusa and Azusa Light & Water desire to comply with
Department of Health Services regulations pertaining to the operation of water treatment
facilities; and
WHEREAS, the City of Azusa and Azusa Light & Water have reached a maximum water
production capacity of existing water facilities, including pump stations, reservoirs, and the
existing water treatment plant; and
WHEREAS, Azusa Light & Water has designed through its engineering consultants a 16 -
million gallon per day water treatment plant incorporating membrane water filtration technology and
estimates the construction cost of the facility to be anywhere from $35 to $40 million; and
WHEREAS, Azusa Light & Water faces other project obligations including the
construction of reservoirs, transmission lines, and other water pipelines/connections which
are estimated to cost between $10 to $15 million; and
WHEREAS, the City of Azusa and Azusa Light & Water desires to finance the construction
of a new water treatment plant and other water facilities needed to meet future water demand and
environmental regulations.
NOW, THEREFORE, THE UTILITY BOARD AND CITY COUNCIL OF THE CITY OF
AZUSA, CALIFORNIA, DOES FIND AND DECLARE THAT:
SECTION 1: Adoption of Financial Plan. The Financial Plan attached to this resolution
as "Exhibit A," to issue debt in the amount of approximately $50 to $55
million, is hereby adopted.
SECTION 2: Effective Date, This Resolution shall become effective upon its adoption.
SECTION 3: Authorization. That the Mayor shall sign and the City Clerk shall certify the
passage and adoption of this Resolution.
PASSED AND APPROVED on this 23d day of October 2006.
Mayor
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I HEREBY CERTIFY that the foregoing resolution No. 06-C101, was duly passed by the
City Council of the City of Azusa at a regular meeting of the Utility Board/City Council thereof on
the 23d day of October 2006, by the following vote of the City Council:
AYES: COUNCILMEMBERS: CARRILLO, ROCHA, CHAGNON
NOES: COUNCILMEMBERS: NONE
ABSENT: COUNCILMEMBERS: HARDISON, HANKS
Vera Mendoza, City
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EXHIBIT A
FINANCIAL PLAN
WATER TREATMENT PLANT AND OTHER WATER FACILITIES
In order to construct a 16 -million gallon per day membrane water treatment plant, a 4 -million
gallon reservoir, and other water facilities including the cost of the 890 reservoirs, the following
financial plan is adopted:
Debt Amount and Instrument
• Issue debt in the amount of approximately $50 to $55 million, subject to final bid
amount/award on the water treatment plant, in the form of tax exempt municipal bonds
Debt Structure
• Issue debt consisting of a fixed rate, stepped wrap financing structure with levelized
payments commencing around the year 2015
Debt Coverage Ratio
• Make commitment to maintain a debt coverage ratio of 160% as a target during the term
of the debt for water rate adjustment purposes
Water Rate Adiustments
• That water rates be adjusted effective July 1, 2007, in the amount of 5%, pursuant to
Proposition 218 requirements
• That subsequent biennial rate adjustments be made in order to maintain the debt
coverage ratio commitment
Use of Reserve Funds
• That the interest income on half of all water reserve funds be used for debt repayment
Debt Legal Issuer
That the legal issuer of this debt be the Azusa Public Financing Authority