27 - Wastewater Treatment Plant Rehabilitation - presentation and contract amendment one

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TWDB, like many other State entities, has been delayed in releasing information, therefore we are not expecting to hear back from the TWDB until August 2020 as to whether we are qualified for funding. Garver USA will be prepared to discuss specifics with the Council on how the TWDB process works as they are very familiar with it. The primary concern for City Staff is not whether the fee itself is appropriate, but how to cash flow paying this fee over the next 12-18 months. Once financing is obtained, it becomes a non -factor as the City will simply begin to budget for annual principal/interest payments as negotiated with the TWDB (once again, we plan to step in to the increases in rates over the next couple of years to help rate payers to acclimate). Until the loan is locked -in though, or if the loan does not work out and the City must seek out Certificates of Obligation, the City will need to carefully monitor how to cash flow covering the expense of this Amendment until financing is available. City Staff have already discussed this with Garver USA; through a combination of holding on to issuing the Notice to Proceed (NTP), extending the original timeline of Phase 2 from 12 months to more like 18 months, setting aside a portion of funding in FY20/21 if necessary, and working with Garver USA to float a pay application if necessary, we are confident we can bridge any gap so that we can keep this project moving forward while getting the financing needed to fund it. Our other option is to delay this a few more months until financing is in hand. City Staff have two routes for long term financing. The preferred route is the TWDB low-interest loan which we will know more about in August. The second route is Certificates of Obligation (Bond). The COs is a fall back to the TWDB loan if necessary. So if in August the TWDB does not give the City of Paris an affirmative notice, then City Staff would pursue the CO. OPTIONS: 1. Tentatively approve Amendment 1 to the agreement for professional engineering services with Garver USA for Phase 2 of the comprehensive rehabilitation of the City of Paris Wastewater Treatment Facility, authorizing the City Manager to sign once a plan of action for long term financing is established. 2. Request that the amendment to the agreement for professional engineering services be brought back to the City Council once a plan of action for long term financing (either the TWDB or Certificates of Obligation) is established. 3. Request additional information on the amendment to the agreement for professional engineering services to be brought forward at a future meeting. 4. Request edits of the amendment to the agreement for professional engineering services. 5. Deny the amendment to the agreement for professional engineering services with Garver USA for Phase 2 of the comprehensive rehabilitation of the City of Paris Wastewater Treatment Facility.