16 - Wastewater Treatment Plan Renovation Project-Long Term Financing-Wastewater Utility Rate Adjustment

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Conclusion: The City Staff, working closely with our experts in engineering, financing, bonding and rates, have developed our best recommendations for proceeding with long term financing of the WWTP Project. This is a critical project that needs to be addressed immediately. The TWDB is unfortunately no longer an option at this time, although it might be in a few years. CO rates have been quite favorable in recent months, thus we recommend pursing bonding in two phases, adjusting the payment schedule to soften the first few payments, adjust the Garver Professional Engineering Services Agreement to account for dividing the project up in to Phase I and Phase II, and one of the three rate adjustment options — while we would recommend the option that provides the most security to the operation, we are comfortable with the option that acclimates the increases over a much softer and extended time. BUDGET: Please see the Status of Issue section above. There are no immediate budget items at this time. OPTIONS: Tonight is not an action item, but rather the City Staff are seeking direction on what to do next. If the City Council is favorable with the Conclusion described above, then City Staff will proceed with developing appropriate CO documents, amendment to the Garver Agreement, and rate ordinance. Otherwise, if the City Council wishes to have more information, we will continue to work hard to bring you whatever information you need. RECOMMENDATION: It is City Staff's recommendation that direction be given to develop: 1. Certificate of Obligation documents in line with a Phase I of $46 million, to start this timeline at the February 8, 2021 City Council meeting. 2. Amendment to the proposed Professional Engineering Services Agreement with Garver to split the WWTP Project in to Phase I and Phase II to match the CO, to be brought back at the February 8, 2021 City Council meeting. 3. Rate Ordinance to match one of the three options the council indicates tonight, to be brought back for consideration and approval at the February 8, 2021 City Council meeting.