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Completing

Completing. the Clean Water. and Drinking Water. Loan Process. Intergovernmental Partnership. Team. Team. Steps to Financing. Intended Use Plan - DONE Local Authorization- by June 30, 2007 Final Application- by October 15, 2007 Project Approval Certificate Loan Commitment- WPAT

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Completing

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  1. Completing the Clean Water and Drinking Water Loan Process

  2. Intergovernmental Partnership Team Team

  3. Steps to Financing • Intended Use Plan - DONE • Local Authorization- by June 30, 2007 • Final Application- by October 15, 2007 • Project Approval Certificate • Loan Commitment- WPAT • Procurement Process • Project Regulatory Agreement • Loan Agreement- WPAT • Loan Closing • Short Term Loans (Interim loans) • Permanent Loans

  4. LocalAuthorization Town Meeting/City Council Vote: • Must be voted by Saturday, June 30, 2007 • General Obligation Pledged as Security • Authorization to Borrow • Use suggested language written by Trust Bond Counsel • Appropriation • Make sure you ask for enough. Include: • Eligible + Ineligible costs • Construction Management Fees • Police Details • Inflation

  5. SUGGESTED FORM OF TOWN MEETING ARTICLE AND VOTE Article To see if the Town will vote to appropriate a sum of money for the [construction] [planning] of (insert description of the water pollution abatement project); to determine whether this appropriation shall be raised by borrowing from the Massachusetts Water Pollution Abatement Trust or otherwise; and to take any other action relative thereto. Vote Voted: that $ is appropriated for the purpose of financing the [construction] [planning] of (insert description of the water pollution abatement project) including without limitation all costs thereof as defined in Section 1 of Chapter 29C of the General Laws, as most recently amended by St. 1998, c.78; that to meet this appropriation the Treasurer with the approval of the Selectmen is authorized to borrow $ and issue bonds or notes therefore under (Chapter 44 of the General Laws or insert reference to other applicable general or special law governing the issuance of local bonds) and/or Chapter 29C of the General Laws, as most recently amended by St. 1998, c.78; that such bonds or notes shall be general obligations of the Town unless the Treasurer with the approval of the Selectmen determines that they should be issued as limited obligations and may be secured by local system revenues as defined in Section 1 of Chapter 29C, as most recently amended by St. 1998, c.78; that the Treasurer with the approval of the Selectmen is authorized to borrow all or a portion of such amount from the Massachusetts Water Pollution Abatement Trust established pursuant to Chapter 29C, as most recently amended by St. 1998, c.78; and in connection therewith to enter into a loan agreement and/or security agreement with the Trust and otherwise to contract with the Trust and the Department of Environmental Protection with respect to such loan and for any federal or state aid available for the project or for the financing thereof; that the (Board of Selectmen, Board of Public Works or other appropriate local body or official) is authorized to enter into a project regulatory agreement with the Department of Environmental Protection, to expend all funds available for the project and to take any other action necessary to carry out the project.

  6. SUGGESTED FORM OF CITY COUNCIL LOAN ORDER Ordered: that $ is appropriated for the purpose of financing the [construction] [planning] of (insert description of the water pollution abatement project) including without limitation all costs thereof as defined in Section 1 of Chapter 29C of the General Laws, as most recently amended by St. 1998, c.78; that to meet this appropriation the Treasurer with the approval of the (Mayor or Manager) and the (Auditor, Finance Committee or other appropriate local body or official) is authorized to borrow $ and issue bonds or notes therefore under (Chapter 44 of the General Laws or insert reference to other applicable general or special law governing the issuance of local bonds) and/or Chapter 29C of the General Laws, as most recently amended by St. 1998, c.78; that such bonds or notes shall be general obligations of the City unless the Treasurer with the approval of the (Mayor or Manager) and the (Auditor, Finance Committee or other appropriate local body or official) determines that they should be issued as limited obligations and may be secured by local system revenues as defined in Section 1 of Chapter 29C, as most recently amended by St. 1998, c.78; that the Treasurer with the approval of the (Mayor or Manager) [and the (Auditor, Finance Committee or other appropriate local body or official)] is authorized to borrow all or a portion of such amount from the Massachusetts Water Pollution Abatement Trust established pursuant to Chapter 29C, as most recently amended by St. 1998, c.78; and in connection therewith to enter into a loan agreement and/or a security agreement with the Trust and otherwise to contract with the Trust and the Department of Environmental Protection with respect to such loan and for any federal or state aid available for the project or for the financing thereof; that the (Mayor or Manager) is authorized to enter into a project regulatory agreement with the Department of Environmental Protection, to expend all funds available for the project and to take any other action necessary to carry out the project.

  7. BorrowerLoanApplication • Due no later than Monday October 15, 2007 (earlier submission encouraged) • Loan Application has three parts • Applicant Information - Authorized Representative, Local Appropriation etc. • Project Requirements - Plans and Specifications, Cost, Schedule, etc. • Supplemental Requirements - Permits, Planning, Professional Services Agreement, etc.

  8. MassDEP Project Approval Certificate (PAC) • PAC Issued by MassDEP to the MWPAT • A copy is sent to Community • PAC certifies project eligibility, costs, and lists conditions

  9. WPAT Loan Commitment Package • Board Vote creates Commitment to Borrower • Includes Requirements Letter outlining the step by step process to close the loan • Loan Questionnaire – ensures WPAT has all necessary information to comply with bond rules • Loan Questionnaire is available on our website. • Green Light Letter – from local counsel • Return Signed Commitment and Questionnaire to WPAT

  10. Borrower Bond Counsel • Issues “Green Light Letter” to WPAT certifying the local vote is legal. • Prepares local bond for delivery to WPAT for interim and permanent loan. • WPAT does not finance local costs for bond counsel.

  11. Borrower Procurement Process • Before the start of bidding, MassDEP must give borrower permission to advertise. • Contracts must comply with SRF requirements. • Bid Specifications must be approved in writing by MassDEP. • MassDEP Civil Rights Section reviews and approves MBE/WBE participation. • MassDEP reviews bid results and authorizes the award of the contract.

  12. MassDEP Project Regulatory Agreement (PRA) • Contract between MassDEP and Borrower • Establishes MassDEP control over project • Outlines project eligibility and funding • Establishes disbursement procedures • Loan closeout process • Legal requirements of Borrower • Discusses project defaults and how to remedy

  13. WPATLoan Agreement • Contract Between WPAT and Borrower • Outlines WPAT and Borrower’s responsibilities • States how a loan default can occur and how to cure the default • Loan defaults do affect the project funding. • Bond Counsel Issues Bond to WPAT • Sign and Return Project Regulatory Agreement (PRA) and Loan Agreement to WPAT.

  14. Interim Financing • Preferable to BANs • Lower interest rate • Easier compliance • Interest rate = ½ Market (currently 1.76%) • Loan origination fee of $500 - $1000 • Become permanently financed within one year • Only pay interest on amount used • Interest payment due at close of permanent loan • Contact WPAT and local bond counsel

  15. Permanent Financing • Funded by WPAT bonds- Fall 2008 • Clean water loans are amortized for up to 30 years with engineers’ certification • Drinking water loans are amortized for up to 20 years only • All interim loans, active projects will be financed. • DEP/WPAT will contact each borrower in summer regarding schedule

  16. Loan Terms/Fees

  17. Disbursements • Receiving the Funds • Proceeds of the loan – interim or permanent – are forwarded to the community on a reimbursement basis • “Drawdown Request” is completed by the community and forwarded to MassDEP with the appropriate documentation • MassDEP reviews the request and approves all eligible costs • MassDEP forwards the request to the WPAT • WPAT wires to borrower within 48 hours

  18. Debt Service Schedule (Schedule C)

  19. Loan Repayment • Due July 15 and January 15 • The Trust will send an invoice 30 days in advance • Invoice will include wire instructions • Debt Service Payments • Administrative Fee Payments • Origination Fee Payment – only at first payment

  20. Things to Remember • WPAT cannot close your loan until alldocuments and fees are received • Fill out the Loan Questionnaire completely(even if you already have for this project) • If you have questions • Financial – Scott Jordan 617-367-9333, x579 or Teresa Altavesta 617-367-9333 x508 • Program – Steve McCurdy 617-292-5779 or Joe Delaney 617-292-5808 • If we cannot help by phone, we will visit.

  21. Website Addresses • MassDEP : www.mass.gov/dep/water/srf.htm • MWPAT : www.state.ma.us/treasury/wpat

  22. Energy Considerations Renewable Energy/Energy Conservation Projects Applicability to SRF

  23. Potential SRF Eligibility • Energy Projects may be eligible for SRF financing if: • It is done in conjunction with an SRF funded project (i.e., not a stand alone project); • The energy is to be used at the facility; and • Excess revenues generated by the project are used to offset rates.

  24. Types of Eligible Projects • Green Building (LEED Certification) • New energy efficient equipment • Energy conservation retrofits • Renewable energy sources such as: • Wind power • Photovoltaic cells • Fuel cells • Digester gas use for power and/or heat

  25. Water and wastewater systems are energy intensive • 35% of municipal energy use • 30% of total (O&M) costs of WWTPs • Electricity demand at WWTPs estimated to grow by ~ 20% over the next 15 years • OPPORTUNITIES • Energy conservation and efficiency • Clean energy (renewable technology)

  26. Energy efficiency can improveoperations and reduce costs Consortium for Energy Efficiency http://www.cee1.org/ind/mot-sys/ww/ww.php3 • Motor systems Pumps (~20%), compressed air (~17%), fans (~5%), drives (~15-50%) • Process opportunities • Water: Filtration, control strategies, use of backup generators (~10-20%) • Wastewater: Aeration, sludge management, process monitoring (~10-20%)

  27. Utility companies have “energy conservation” resources to assist you • First stop – Go through your Municipal Account Representatives • National Grid (nationalgridus.com) • Kevin Keena, Technical Assistance Audits kevin.keena@us.ngrid.com, (508) 421-7279 • Anita Hagspiel, Building Energy Efficiency anita.hagspiel@us.ngrid.com, (508) 421-7221 • NSTAR (www.nstar.com) • Nelson Medeiros, Technical Assistance Audits, nelson_medeiros@nstaronline.com, (781)441-8703 • Brett Feldman, Building Energy Efficiency brett_feldman@nstaronline.com, (781) 441-8344 • Unitil (www.unitil.com) • Ed Mailloux, (603) 773-6541 • Western MA Electric (http://www.wmeco.com/) • Ron Johnson, johnsyx@nu.com, (413) 787-4732 • Cape Light Compact (www.capelightcompact.org) • John Burns, (508) 375-6829, burnsje@cape.com

  28. The Massachusetts Renewable Energy Trust is assisting MA communities • Clean Energy program(http://www.mtpc.org/renewableenergy/cleanenergy.htm) Community Wind Collaborative • Wind Turbine Site Survey http://www.mtpc.org/renewableenergy/Community_Wind/CWC_site_survey.html • This survey helps municipalities identify locations which may be appropriate for a wind project. • Small on-site projects, with large electric loads (e.g., a wastewater treatment plants) may be feasible to pursue. • Some additional EPA NE energy resources • EPA: http://www.epa.gov/region01/eco/energy/index.html • http://www.epa.gov/ne/eco/energy/assets/pdfs/ne-energy-brochure-200609.pdf

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