ITEM 7: APPROVAL OF A STATE REVOLVING FUND LOAN FOR THE CITY OF PLACERVILLE, HANGTOWN CREEK WASTEWATER TREATMENT PLANT PHASE IIB, STATE REVOLVING FUND LOAN PROJECT NO. C-06-4505-110

DISCUSSION: In accordance with the State Water Resources Control Board's (SWRCB) Policy for Implementing the State Revolving Fund (SRF) for Construction of Wastewater Treatment Facilities (Policy), adopted on February 16, 1995 and amended on January 18, 1996, projects on the adopted priority list need SWRCB approval to receive a SRF loan. Loans can be approved by the SWRCB after the Division of Clean Water Programs (Division) has approved the facilities plan, including (1) the project report; (2) environmental documents; (3) the draft revenue program; and (4) the water conservation plan.

The Division issued Facilities Plan Approval the City of Placerville (City) for the Hangtown Creek Wastewater Treatment Plant Phase IIB, and the City agreed in writing with the approval.

The City is located approximately 48 miles east of Sacramento (see attached map). The City serves a population of approximately 9200 and the treatment plant average flow is about 1.31 million gallons per day.

The City's treatment plant generally produces a high quality effluent. However, during wet weather flows the plant does experience problems meeting discharge requirements with respect to coliforms, suspended solids, pH, and temperature. The City has an ongoing program to control infiltration and inflow in the collection system. The proposed project will expand the secondary treatment facilities by adding fine-bubble aeration and secondary clarification to better handle the increase in flow during the wet season. Expansion of the chlorination facilities is also proposed. This project does not represent an increase in dry weather plant capacity.

The estimated project cost is $4,448,807, and the estimated loan eligible cost is $3,500,000.

The domestic water supply for the City is provided by the Placerville Water Department and a local purveyor. Water supplies are adequate for the 20-year project life because of several adequate surface water sources. On May 1, 1997, the City submitted an acceptable water conservation plan to comply with the SRF Policy water conservation requirements

The City has provided the Division with a schedule contained in the milestone schedule in the Division's facilities plan approval letter. In accordance with Section IX (J) of the SRF Policy, if biddable plans and specifications are not approved by the expiration date of the preliminary loan commitment, the Division may approve up to a ninety (90) day extension for good cause

The City prepared a Negative Declaration/Initial Study which was distributed to the public and circulated through the State Clearinghouse (SCH#96062098) for review from June 25, 1996 to July 25, 1996. The City did not receive any significant comments during the review period. On August 13, 1996, the City Council approved the project, adopted the Negative Declaration and on March 26, 1997, the City filed a Notice of Determination with the El Dorado County Clerk and the Governor's Office of Planning and Research.

The City requests the SWRCB approve a zero percent interest loan of $3,500,000 for this project. To be eligible for the zero percent interest loan, the City will adopt a resolution to provide the required State funding match of $582,347, which is equal to 16.667 percent of the loan amount, and agrees to pay back the loan in accordance with the SRF Policy.

POLICY ISSUE: Should the SWRCB approve SRF loan funding for the proposed project, including a twenty (20) year repayment period, with the first repayment due one (1) year after completion of construction? Should the SWRCB, in accordance with Section IX (J) of the SRF Policy, condition this approval by requiring expiration of the preliminary loan commitment if construction of this project is not initiated by September 1, 1997.

RWQCB: None

FISCAL IMPACT: According to SWRCB Resolution No. 97-001 (Approval of a Staff Proposal to Better Manage the SRF Repayment Account), the SWRCB may approve preliminary loan commitments against the current FFY account and against 125 percent of future repayment monies based on construction periods. The SRF account balances, anticipated disbursement amounts, and project approvals under consideration by the SWRCB in July 1997 are as follows:

STAFF RECOMMENDATION: That the SWRCB adopt a resolution approving a zero percent interest loan for the proposed project, with a repayment period of twenty (20) years, with the first repayment due one (1) year after completion of construction. In accordance with the February 16, 1995, revisions to the SRF Policy, the proposed resolution includes an expiration date for this preliminary loan commitment if the date for initiation of construction is not met.

June 23, 1997 DRAFT

WHEREAS:

1. The State Water Resources Control Board, on February 16, 1995, adopted the "Policy for Implementing the State Revolving Fund (SRF) for Construction of Wastewater Treatment Facilities", and amended it on January 18, 1996;

2. The State Water Resources Control Board, on September 19, 1996, adopted the FFY 1997 SRF Loan Program Priority List which included the Hangtown Creek Wastewater Treatment Plant Phase IIB, City of Placerville in Priority Class C;

3.The Division of Clean Water Programs (Division) has approved the project report, environmental documents, draft revenue program, and water conservation plan for the City of Placerville's project; and

4.The City of Placerville adopted a Negative Declaration (State Clearinghouse No. 96062098) prepared for the project which has been reviewed and considered, and it has been determined that the proposed project will not result in any significant negative environmental impacts.

THEREFORE BE IT RESOLVED THAT:

The State Water Resources Control Board

1. Approves a zero percent interest SRF loan of $3,500,000 to the City of Placerville for construction of the Hangtown Creek Wastewater Treatment Plant Phase IIB project, the repayment period is twenty (20) years, the first repayment due one (1) year after completion of construction; and

2. Will withdraw this preliminary loan commitment if construction of this project is not initiated by September 1, 1997, unless the Division approves a ninety (90) day extension for good cause.

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 July 17, 1997.

____________________________

Maureen Marché

Administrative Assistant to the Board