NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST · NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST SFY-2013 Rate Structure / Allocation GENERAL LOAN PROGRAM 75% - Fund Loan (0% rate DEP

NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST


David Zimmer

Executive Director _______________________________________________________________

NJ Environmental Infrastructure Trust

Welcome


The New Jersey Environmental Infrastructure Trust is the independent

State Financing Authority responsible for providing and administering low cost interest

-rate loans to qualified municipalities, counties, regional authorities and water purveyors for

the purposed of financing water quality related infrastructure projects.

NJEIT Mission Statement


Environmental Infrastructure Financing Program – NJ EIFP

Equal Partnership

NJ DEP NJ EIT

Local Borrowers


Contractor

Borrower (Municipality,

Authority, etc.)

Debt Service Repayment

$

Trust Loan $

Bond Trustee (MPTA)

Bond Investors

NJEIT

DEP

Federal/State

Fund Loan $

Bond Proceeds

SRF / Bond $$

Backed by GO’s, SA’s, etc.

Fund Loan Debt Service (0.51 yrs.

in arrears)

Trust Loan Debt Service


SFY-2013 Rate Structure / Allocation

GENERAL LOAN PROGRAM 75% - Fund Loan (0% rate DEP loan) + 25% - Trust Loan (AAA Market-rate loan)

PRINCIPAL FORGIVENESS PROGRAM: up to $20MM Green projects (expanded) in

Barnegat Bay Watershed

25% - Principal Forgiveness (max. of $2MM, no principal repayment due upon completion) + 50% - Fund Loan (0% rate DEP loan) + 25% - Trust Loan (AAA Market-rate loan)


Below Market Rate = Blend of 0% DEP “Fund” Loan and AAA Market “Trust” Loan

20 yr. savings on $1mm Borrowed:

~ $120,000 / each 1% saved


How the NJEIFP Advances the State

Strategic Plan


How the NJEIFP Advances the State Strategic Plan

Goal 1: Targeted Economic Growth •  Projects Funded

•  Project Ranking Methodology

Goal 4: Tactical Alignment of Government •  Low interest financing to leverage limited local government dollars, and in some cases, options


Goal 1: Targeted Economic Growth

•  Projects Funded - Wastewater Project Loans

- Drinking Water Project Loan

- Stormwater Management

•  Project Ranking Incentives in Growth Areas - Prioritization: CSOs, Brownfields Reserve

- Ranking Points:

-  Urban and Regional Centers

-  Designated Towns


The EIFP Funds Infrastructure in Priority Growth Areas

• Challenge: Fund projects that upgrade existing infrastructure where needed (Vibrant Regions) versus Adding new capacity

• Fund Redevelopment projects that strengthen existing cities, towns and neighborhoods through remediation of existing sites

• Provide opportunities for private capital investing by transferring risk away from public funds to private equity

• Facilitate construction of critical investment grade projects for additional private equity in which to invest

•  Continue to maximize the leveraging of public monies


Limited Municipal Financing Resources Significant Savings Relative to Independent Financing

• Interest Rates 25% - 50% market rates • Trust Excellent Credit Rating • No debt service reserve fund or bond insurance required • Capitalized interest allows deferring of financing costs • NJEIFP Loan Administration • NJEIFP manages arbitrage issues • NJEIT tracks and manages refunding opportunities

Tactical Alignment of Government


Importance of Strategic Investment in NJ’s Physical Infrastructure

The NJEIFP has been critical in financing infrastructure, supporting key industry clusters throughout New Jersey


Necessity for Coordinated Planning


Necessity for Coordinated Planning

Estimated 20-Year State Infrastructure Needs

1.  Water Supply $ 8.0 B 2.  Clean Water

a.  Wastewater Disposal $17.0 B b.  Stormwater Mgmt $16.0 B c.  Nonpoint Source Control $ 2.0 B

Total $ 43.0 B

* New Jersey Clean Watersheds Needs Survey 2008


20-Year Estimated Infrastructure Needs

Drinking Water

1. Water Supply: $8.0 B *

1. Transmission/Distribution $4.7 B

2. Source Development and Rehabilitation $0.31 B

3. Treatment $1.9 B

4. Storage $1.1 B



Clean Water

2a. Wastewater Disposal: $ 17.0 B *

1.  Wastewater Treatment $ 6.3 B

2.  Pipe repair & new pipes $ 2.3 B

3.  Recycled water distribution $ 0.10 B

4.  Combined sewer overflow correction $ 8.2 B




Clean Water

2b. Stormwater Management: $ 16.0 B *

1.  Conveyance infrastructure $ 0.49 B

2.  Treatment systems $ 0.11

B

3.  Green infrastructure $ 14.9 B

4.  General stormwater management $ 0.11 B




Clean Water

2c. Nonpoint Source Control: $ 2.0 B *

1.  Agriculture best management practices $ 0.08 B

2.  Ground water protection $ 0.55 B

3.  Brownfields remediation $ 0.83 B

4.  Storage tank remediation $ 0.003 B

5.  Sanitary Landfills BMPs $ 0.276 B

6.  Hydromodification $ 0.004 B




•  Investment in the infrastructure (assets) and O&M (labor/supplies) of water & sewer facilities expands the productive capacity of the economy and creates value-added:

•  ROI Analysis - Every $1.00 of water & sewer infrastructure investment increases private output (long-term) by $6.35 *

•  Each additional $1.00 of water & sewer revenue spent on O&M increases revenue in all industries by $2.62 that year *

•  Each additional job in water & sewer creates 3.68 jobs in the national economy to support that job *

•  ROI from water & sewer infrastructure exceeds that of highways *

•  Promotion of much needed job growth through facilitation of investment in Priority Growth Investment Areas

* Source: U.S. Conference of Mayors, Local Government Investment in Municipal Water and Sewer Infrastructure, 8-14-2008.

Benefits of Strategic Investment in NJ’s Physical Infrastructure


David Zimmer Executive Director, NJEIT

[email protected]

Geoffrey Stewart Financial Advisor, Public Financial Management

[email protected]

Richard Nolan Bond Counsel, McCarter & English

[email protected]

Karla Martin DEP – Office of Equal Opportunity and

Lydia Harper Public Contract Assistance

[email protected]

[email protected]

Gene Chebra Acting Assistant Director,

DEP – Office of Municipal Finance

[email protected]

Terry Caruso DEP Green Acres,

[email protected]

Contact List


Documents

NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST · NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST SFY-2013 Rate Structure / Allocation GENERAL LOAN PROGRAM 75% - Fund Loan (0% rate DEP