ITEM 2

SUBJECT

APPROVAL OF A STATE REVOLVING FUND LOAN FOR THE CITY OF AMERICAN CANYON (CITY), CONSTRUCTION OF A NEW TERTIARY WASTEWATER TREATMENT PLANT, STATE REVOLVING FUND (SRF) LOAN PROJECT NO. C-06-4666-110

DISCUSSION

At the Workshop on November 3, 1999, the State Water Resources Control Board (SWRCB) listened to the testimony and considered the request from the City for a $12 million SRF loan for the construction of a new tertiary wastewater treatment plant. The item was approved for the Uncontested Items Calendar for November 18, 1999.

At the Board Meeting on November 18, 1999, the owner of the land, where this new wastewater treatment plant will be built, and other local residents spoke in opposition to this project and requested funding denial. The SWRCB decided to delay the funding commitment for this project until the City receives a NPDES Permit.

The Tentative Order for the NPDES Permit for the City’s proposed wastewater treatment plant was sent out by the San Francisco Bay Regional Water Quality Control Board (SFBRWQCB) for comments on August 30, 1999. A SFBRWQCB regular Board Meeting was to be held on October 20, 1999, to consider the proposed Waste Discharge Requirements (WDRs) for the proposed wastewater treatment plant for adoption. The SFBRWQCB was unable to act on the proposed WDRs because there was not a quorum present. It is unknown when a quorum will be available. By a memorandum dated November 1, 1999, the SFBRWQCB requested the SWRCB to consider adopting the WDRs for the proposed wastewater treatment plant.

On November 19, 1999, the City Manager, Mark Joseph, sent a letter (Attachment 1) to the SWRCB requesting a special meeting be scheduled in December 1999 to consider a funding commitment for this Project.

RWQCB IMPACT

SFBRWQCB – Completion of this project will provide additional wastewater treatment capacity in the Napa county area. Wastewater generated in the City is currently treated at the Soscal Wastewater Treatment Plant owned and operated by Napa Sanitation District. A new NPDES Permit will need to be issued to set standards for this discharge.

FISCAL IMPACT

The SWRCB adopted Resolution No. 99-40 on May 20, 1999, which changed the method for deter-mining the amount of funding available for new loans to a system based on the availability of cash to make disbursements to the project under consideration by the SWRCB. A minimum cash balance of $25,000,000 will be maintained. The SRF account balances, anticipated repayment amounts, and project approvals under consideration by the SWRCB in December 1999 are as follows:

	SFY	SFY	SFY	SFY	SFY
	1999-00	2000-01	2001-02	2002-03	2003-04
	___________	__________	__________	_________	_________
Beginning Balance:	$517,435,127	$301,845,485	$89,663,288	$23,380,248	$77,393,605
Est. Repayments:[1]	75,815,972	91,259,186	101,363,468	120,402,319	146,264,231
Cap Grants:[2]	112,520,000	0	0	0	0
Est. SMIF Interest:	10,000,000	6,000,000	1,000,000	1,000,000	1,000,000
Est. Disbursements:[3]	-410,025,615	-301,641,383	-168,646,508	-67,388,962	-0
Subtotal:	$305,745,485	$97,463,288	$23,380,248	$77,393,605	$224,657,836

City of American Canyon 4666-110	-3,900,000	-7,800,000




Balance:	$301,845,485	$89,663,288	$23,380,248[4]	$77,393,605	$224,657,836

STAFF RECOMMENDATION

That the SWRCB adopt a resolution approving a SRF loan of $11.7 million from the SFY 2000 and 2001 accounts for the proposed project, with a repayment period of 20 years, and with the first repayment due one year after completion of construction. In accordance with the June 18, 1998, SRF Policy, the proposed resolution includes an expiration date for this preliminary loan commitment if construction is not initiated by June 1, 2000.

____________________________________________________________________________

DRAFT Dec. 10, 1999

STATE WATER RESOURCES CONTROL BOARD

RESOLUTION NO. 99-___

APPROVAL OF A STATE REVOLVING FUND (SRF) LOAN COMMITMENT

FOR THE CONSTRUCTION OF A NEW TERTIARY WASTEWATER TREATMENT PLANT

CITY OF AMERICAN CANYON (CITY)

STATE REVOLVING FUND LOAN PROJECT NO. C-06-4666-110

WHEREAS:

1. The State Water Resources Control Board (SWRCB) on February 16, 1995, adopted the Policy for Implementing the State Revolving Fund for Construction of Wastewater Treatment Facilities, and amended it on June 18, 1998;

2. The SWRCB, on June 17, 1999, adopted the FFY 2000 SRF Loan Program Priority List which included the proposed project in the Priority Class D;

3. The Division of Clean Water Programs has approved the project report, environmental documents, and a draft revenue program, for the City’s project;

4. The City is the water purveyor for the service area and a signatory to the Memorandum of Understanding Regarding Urban Water Conservation in California;

5. The City has not yet obtained a new NPDES Permit from the San Francisco Bay Regional Water Quality Control Board (SFBRWQCB) for the proposed new tertiary wastewater treatment plant; and

6. The City has certified an EIR (State Clearinghouse No. 98092020) which has been reviewed and considered, and it has been determined that:

a. Changes or alterations have been or will be required in, or incorporated into the proposed project which avoid or reduce to less than significant levels potentially significant environmental effects identified in the EIR with respect to: (i) hydrology, water quality, and soils erosion impacts which will be mitigated by: complying with grading plans and NPDES and Storm Water Pollution Prevention Plan permit requirements; minimizing and revegetating disturbed areas; detaining or diverting runoff; protecting exposed slopes from erosion and gullying; using designated storage areas for wastes; limiting activities in wetlands to the dry season; providing flood control protections; implementing an industrial pre-treatment program; restricting reclaimed water application to saturated soils and implementing a reclaimed water monitoring program; and implementing an educational program to minimize disposal of pollutants and toxics to the sewer system; (ii) threatened and endangered species which will be mitigated by: boring and jacking under creek beds or open trenching during the dry season; avoiding all perennial aquatic habitats; erecting silt fencing at stream channels; conducting pre-construction surveys for active raptor nests, the California red-legged frog, and other special-status species and complying with U.S. Fish and Wildlife Services (USFWS) requirements; establishing buffer zones; restoring any disturbed aquatic habitat; conducting a sampling and monitoring program for water quality and aquatic organisms; and conducting formal consultation with the USFWS regarding indirect, growth inducing impacts; and (iii) cultural resources which will be mitigated by consulting with a qualified archaeologist or paleontologist in the event of unanticipated discovery of cultural materials and implementing an approved recovery program.

b. With respect to other potentially significant environmental impacts identified in the environmental document, appropriate changes or alterations are not within the responsibility and jurisdiction of the SWRCB. Such other changes or alterations have been adopted or should be adopted by other agencies.

THEREFORE BE IT RESOLVED THAT:

The State Water Resources Control Board

1. Approves a preliminary loan commitment of $11.7 million for this project from the SFY 2000 and 2001 accounts to the City of American Canyon (City) for the construction of a new tertiary wastewater treatment plant, with a repayment period of 20 years, and the first repayment due one year after completion of construction;

2. Will withdraw this preliminary SRF loan commitment if construction is initiated either prior to obtaining the right of entry to the property where the proposed wastewater treatment plant will be constructed, or prior to completion of consultation with the U.S. Fish and Wildlife Services under Section 7 of the U.S. Endangered Species Act regarding secondary growth inducing impacts;

3. Will withdraw this preliminary SRF loan commitment if construction is not initiated by June 1, 2000. The Division may approve up to a 90-day extension for good cause; and

4. Will not issue a loan contract until the City obtains a NPDES Permit for the proposed wastewater treatment plant.

CERTIFICATION

The undersigned, Administrative Assistant to the Board, does hereby certify that the foregoing is a full, true, and correct copy of a resolution duly and regularly adopted at a meeting of the State Water Resources Control Board held on December 15, 1999.

______________________________

Maureen Marché

Administrative Assistant to the Board

[1] Est. repayments include repayments from existing loans and from loans expected to be executed in the next few years for projects with existing commitments.

[2] An EPA Capitalization Grant of $97,000,000 for SFY 2000 is anticipated (the federal budget is not approved at this time) plus State match funds of $19,400,000. $3,880,000 is deducted for administrative costs.

[3] Estimated disbursements include disbursements remaining on existing loans as well as disbursements anticipated on loans executed for projects with existing commitments (including FY2000 commitments). The Division will revise the estimated disbursements total each month as cash draw forecasts are updated.

[4] The cash balance on June 30, 2002, is estimated to be $1,619,752 below the level needed to maintain a $25,000,000 reserve.