STATE WATER RESOURCES CONTROL BOARD

WORKSHOP SESSION -- DIVISION OF CLEAN WATER PROGRAMS

MARCH 5 & 6, 1997

ITEM: 4

SUBJECT: APPROVAL OF A STATE REVOLVING FUND LOAN FOR CITY OF RIVERSIDE, RIVERSIDE REGIONAL WATER QUALITY CONTROL PLANT, BACKUP POWER PROJECT, STATE REVOLVING FUND LOAN PROJECT NO. C-06-4331-120.

DIS- In accordance with the State Water Resources Control Board's (SWRCB) Policy for

CUSSION: 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) water conservation plan.

On January 23, 1997 the City of Riverside received facilities plan approval from the Division for the backup power project. The City has agreed in writing with the Division's facility plan approval letter.

The City's proposed backup power project for the Regional Water Quality Control Plant (RWQCP) is required to comply with the treatment plant's waste discharge requirements and meet U.S. EPA Class I power supply system reliability criteria which states that two separate and independent sources of electric power should be provided to the wastewater treatment plant from either two separate utility substations or from a single utility substation and a works-based generator. Currently, the RWQCP receives all its power from a single utility substation and therefore does not have the necessary reliable backup power system to meet emergency power needs. The City's proposed backup power project consists of three internal combustion (IC) lean burn engine generators of 1.1 megawatts (MW) each, for a total of 3.3 MW; switch gears; interface to the electric grid; natural gas connection upgrade; installation and yard piping; and building and site work. The IC engines will be able to use a combination of digester gas, landfill gas, and natural gas for fuel.

The project site is located within the City of Riverside as indicated on the attached map. The estimated loan eligible project cost including engineering and administration allowances is $4.3 million. The City of Riverside supplies its residents with potable water from its own ground water wells. According to the City's figures, there is adequate water supply over the life of the project (12 years). The City is also a signatory to the Memorandum of Understanding Regarding Urban water Conservation in California, September 1991, California Urban Water Conservation Council.

The City of Riverside has provided the Division with a schedule containing project milestones. These dates are included in the Division's facilities plan approval letter. According to the project milestones, the City will submit the final plans and specifications for facility construction by June 30, 1997. In accordance with Section IX (J) of the SRF Policy, the draft resolution includes this date as a deadline for submittal of final plans and specifications. The Division may approve up to a ninety (90) day extension for a good cause.

The City prepared a Mitigated Negative Declaration for the backup power project which was distributed to the public and circulated through the State Clearinghouse (SCH# 96051002) for review from May 1, 1996 to May 30, 1996. During the review period, the City did not receive any comments. The City Council adopted the Mitigated Negative Declaration on October 22, 1996. The City filed a Notice of Determination with the Riverside County Clerk on November 4, 1996, and with the Governor's Office of Planning and Research on December 18, 1996.

The City requests that SWRCB approve a zero percent interest loan of $4.3 million for the project, with a twenty (20) year repayment period. The City Council adopted Resolution No.18998 which provides the State match funding equal to 16.667 percent of the eligible project cost of $4.3 million or about $716,681, based on the engineer's estimate. The first SRF loan repayment will be due one (1) year after completion of construction.

POLICY Should the SWRCB approve zero percent SRF loan funding for the proposed project

ISSUE: 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 January 18, 1996 SRF Policy, condition this approval requiring expiration of the preliminary loan commitment if final biddable plans and specifications are not submitted by June 30, 1997.

REGIONAL None

BOARD

IMPACT:

FISCAL According to SWRCB Resolution No. 97-001 (Approval of a Staff Proposal to Better

IMPACT: 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 scheduled loan dates.

The SRF account balances, anticipated repayment amounts, and project approvals under consideration by the SWRCB in March 1997 are as follows:

STAFF That the SWRCB adopt a resolution approving a zero percent interest SRF loan of

RECOMMEN-$4.3 million for the proposed project, with a repayment period of twenty (20) years,

DATION: with the first repayment due one (1) year after completion of construction. In accordance with the January 18, 1996 SRF Policy, the proposed resolution includes an expiration date for this preliminary loan commitment if the submittal date of final plans and specifications for facility construction is not met.

STATE WATER RESOURCES CONTROL BOARD

RESOLUTION NO. 97 -

APPROVAL OF A STATE REVOLVING FUND FOR THE CITY OF RIVERSIDE

RIVERSIDE REGIONAL WATER QUALITY CONTROL PLANT

BACKUP POWER PROJECT, STATE REVOLVING FUND LOAN

PROJECT NO. C-06-4331-120

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 City of Riverside, Riverside Regional Water Quality Control Plant, Backup Power Project in Priority Class C;

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

4. The City adopted a Mitigated Negative Declaration (State Clearinghouse No. 96051002) prepared for the project which has been reviewed and considered and it has been determined that the project will not result in any significant environmental impacts; and

5. The City Council of the City of Riverside adopted a resolution committing to provide the State funding match equal to 16.667 percent of the total eligible project costs to qualify for a zero percent interest SRF loan.

THEREFORE BE IT RESOLVED THAT:

The State Water Resources Control Board approves a zero percent interest SRF loan of $4.3 million to the City of Riverside for the construction of the Backup Power Project at the Riverside Regional Water Quality Control Plant, with the following provisions:

a) the repayment period is twenty (20) years;

b) the first repayment is due one (1) year after completion of construction; and

c) this preliminary loan commitment will expire if biddable plans and specifications are not received by June 30, 1997, unless the Division approves a ninety (90) day extension for good cause.

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 March 20, 1997.

Maureen Marché

Administrative Assistant to the Board