Presented By:Utility Manager

Action Taken:YesNo2

Abstain_tL

CITY OF NOME, ALASKA

RESOLUTION NO. R-15-ol-o3

A RESOLUTION APPROVING & ACCEPTING A LOAN FROM THE ALASKA DEPT. OFENVIRONMENTAL CONSERVATION ALASKA DRINKING WATER FUND TO

PROVIDE FINANCING FOR IMPROVEMENTS TO COMMUNITY WATERINFRASTRUCTURE

WHEREAS, the Nome Joint Utility Board determined application should be submitted to theAlaska Department of Environmental Conservation Drinking Water Fund Program to finance variousinfrastructure improvements to water and sewer systems, including replacements, extensions andenhancements; and,

WHEREAS, the Alaska Department of Environmental Conservation has Alaska Clean Water& Alaska Drinking Water Fund loan programs with terms up to 20 years with no prepaymentpenalties to provide low interest (1.5%) financing to communities for water and sewer systems andNJUS submitted annual questionnaires to be included on the Intended Use Plans for these ADECprograms; and,

WHEREAS, by Resolution R-14-lo-o2, which amended Resolution R-13-o5-o2, a loanamendment was authorized for Project #627161, to provide additional match funding for SclaircoreReplacement Phase ; and,

WHEREAS, Sclaircore Replacement Phase i requires funding to match municipal matchinggrants for East 5th Avenue construction, and ADEC recommended combining the initial loanamendment with the additional required match, for a total of $1,563,6oo; and,

NOW, THEREFORE, BE IT RESOLVED that the Nome City Council approves and acceptsan ADEC Drinking Water Fund Loan for the construction of water system improvements for a newtotal of $1,563,600, with a 20-year payback at i.% interest, as recommended by Nome Joint UtilityBoard Resolution ‘4-17, and authorizes the Utility Manager as Chief Operating Officer of the Utilityto execute any and all documents that may be required by the Department to reflect theindebtedness, the terms of its repayment, and any security thereof, including but not limited to anagreement for the loan and a promissory note.

APPROVED and SIGNED this 12th day ofJanuary, 2015.

DENISE MICHELS,

ATTEST:

TOM MORAN, Clerk

NOME JOINT UTILITY SYSTEM

NOME JOINT UTILITY BOARD

RESOLUTION 14-17

A RESOLUTION REQUESTING THE NOME COMMON COUNCIL APPROVE & ACCEPTA LOAN FROM THE ALASKA DEPT. OF ENVIRONMENTAL CONSERVATION ALASKADRINKING WATER FUND TO PROVIDE LOAN FINANCING FOR IMPROVEMENTS TO

COMMUNITY WATER INFRASTRUCTURE

WHEREAS, The Utility Board determined application should be submitted to the AlaskaDepartment of Environmental Conservation Drinking Water Fund Program tofinance various infrastructure improvements constructed to the water and sewersystems, including replacements, extensions and enhancements; and,

WHEREAS, the Alaska Department of Environmental Conservation Alaska Clean Water &Alaska Drinking Water Fund loan programs offers terms up to 20 years with noprepayment penalties to provide low interest (1.5%) financing to communities forwater and sewer systems; and

WHEREAS, NJUS submitted annual questionnaires to be included on the Amended IntendedUse Plans for the ADEC Drinking Water Loan program. ADEC has completed thepublic notice process and has included funding for East Nome Water Replacement— $2,690,000, and intends to offer NJUS a loan of up to that amount; and,

WHEREAS, initial loan applications made to provide partial funding for Sclaircore ReplacementPhase 2A, additional federal funding was awarded, and the existing loan onlypartially matches state grants for Phase 2B, and Sclaircore Replacement Phase I(East 5 Avenue) requires funding to match municipal matching grants forcompletion of Phase 28 and Phase I (East 5th Avenue) — for a total of $1,563,600;

NOW THEREFORE BE IT RESOLVED that the Nome Joint Utility Board requests the NomeCommon Council approve and authorize acceptance of a loan for $1,563,600 through the ADECDrinking Water Fund Loan Program for construction of water system improvements with a 20 yearpayback at 1.5% interest, and authorize the Utility Manager as Chief Operating Officer of the Utilityto execute any and all documents that may be required by the Department to reflect theindebtedness, the terms of its repayment, and an security thereof, including but not limited to anagreement for the loan and a promissory note.

SIGNED THIS I DAY OF &vY bel , 2014 AT NOME, ALASKA.

Berda Wilison, ChairmanATTEST: NOME JOINT UTILITY BOARD

David Barron, SecretaryNOME JOINT UTILITY BOARD

‘7

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ALASKA DRINKING WATER FUND

STATE WATER LOAN PROGRAM

INTENDED USE PLAN - AmendedFINAL

FFYI4 Grant Allotment

State Fiscal Year 2015

IIIi‘[I

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llSubmitted to the U.S. Environmental Protection Agency

ByAlaska Department of Environmental Conservation

Division of WaterDecember 2014

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NOME JOINT UTILITY BOARDMeeting Date: December 18, 2014

Sclaircore Replacement Phase I & II; ADEC Drinking Water & Clean Water LoansResolutions 144w & 140&

NJUS applied for two municipal matching grants (MMGs) for Sclaircore Replacement Phase 2,for two phases to replace water-sewer utilities in the east quadrant of town, from Front to 6th

between N and K streets. The State awarded funding for Phase 2A in the amount of $3.OMMand Phase 2B in the amount of $4.557MM, the total of which represented 57% of the project.(Nome is eligible for up to 70% match, but in our initial application DEC limited the award to$3.0MMtypicalIy their grant limit (only 45%), although we were successful in making the casefor 70% funding in the second application.

Concurrent with the initial MMG application, the Utility submitted loan questionnairesequivalent to the amount of Phase 2A to be considered for funding under the Alaska DrinkingWater and Clean Water Loan Programs. These questionnaires successfully rated and wereincluded in the respective program’s Intended Use Plans (IUP). The Drinking Water Fund loanof $1,990,000 included a 50% subsidy (loan forgiveness) component. The Clean Water Fundloan of $1,740,000 included approximately 10% subsidy.

NJUS continued to seek out additional potential funding from federal sources to provideadditional matching funds for Phase 2B. We were not successful in our quest with USDA duringthis round, but did capture $769,800 in EPA funding for the project. This left a residual fundingneed of $1.2MM to fully match the state grants.

NJUS also applied for a MMG for Sclaircore Replacement Phase I (East 5th Avenue) and wasawarded $1,058,000 for the project. Concurrently, application was made to USDA for matchfunds. USDA accepted an application for a $308,000 loan and a $1,075,000 grant for furtherprocessing to provide additional funding for the project. We continued discussions with USDAas the terms being offered were onerous, requiring significant reserves to be funded on anannual basis, but the project had already been started. While other requirements to secure thefunding were not completed as we believed we were still in negotiation, USDA now advises thatbeing the project was started before all items had been resolved, they cannot provide fundingfor the project. (In a prior project, USDA did award funding subsequent, but based on their owninternal reviews, were directed they could not do so again — something that was not sharedwith NJUS until recently.)

ADEC was contacted and agreed that NJUS could include the Phase I (East 5th Avenue) in arevised application, and that the amendment requests for additional funding for Phase 2 shouldbe included in the same application, as opposed to amending an existing loan.

Recommended action:

That Resolutions 14-17 and 14-18 be adopted, to provide additional Phase 2 and include Phase Imatching funds in new loans applications, and that the prior amendments contained for Phase2 in Resolutions 14-07 and 14-08 be rescinded.

J. Handeland12/15/14

NOME JOINT UTILITY SYSTEMa component unit of

P.O. Box 70 Nome, Alaska 99762 (907) 443-NJUS Fax (907) 443-6336

December 10, 2014

RE: USDA Anticipated FundingEast 5th Avenue Sclaircore Replacement

In 2010, NJUS submitted an application for funding to USDA for funding assistance with theconstruction of East 5th Avenue Sclaircore Replacement. After meeting with USDA personnel,additional updates were required to the Preliminary Engineering Report (PER) and EnvironmentalReport (ER), which were done and submitted. On May 25, 2011, USDA issued an Initial Letter ofConditions (LOC) advising funding application ($308,000 loan and $1,075,000 grant) had beenselected for further processing.

The LOC included numerous provisions, including the requirement to establish operating (annual$377,196) nd short lived asset replacement (annual $290,833) reserves, NIUS transmitted toUSDA concern relative to these requirements and requested a review and revision, as theserequirements in themselves would require additional revenue of approximately $43 percustomer per month before considering debt service.

A pre-construction meeting was scheduled for July 2011, but USDA advised they could notparticipate due to short notice and the emergency family leave of one of their personnel. Workcommenced on the project and the USDA Engineer came to Nome later in the month for whatwe believed was a follow-up for the pre-construction meeting, hut USDA considered it only aninspection, noting work had commenced.

USDA considered the request relating to the reserve requirements and revised them in anAmended LOC issued in February 2012. In May 2012 the Utility Board passed resolutions on thefinancing and submitted a request to USDA relative to the financing, as the standard forms hadbeen previously found unworkable (due to their requirement of placing USDA in “first position”,and other USDA loans and the Alaska Municipal Bond Bank issue already had superior position).We find no response was received.

NJUS considered the financing secured and reflected same as outstanding receivables. In March2014 as we were working to resolve all outstanding grant/loan matters, NJUS met with the USDAengineer to review the status and were advised to contact the Community Programs Director(CPD) to determine outstanding matters required to finalize the funding. In response to ourrequest, the CPD telephoned to advise of her impending retirement and that this file would needto wait until later in the year when new personnel were in place.

Pr’ovicling reliable utility services to system rate payers efficiently and econoinkally by

RE: USDA Anticipated Funding — East 5th Avenue Sclaircore ReplacementDecember 10, 2014Page 2.

On November 10, the Utility Manager met with the City Manager and Finance Director expressingconcern that the funding could fall through. A call was placed to USDA and they confirmed thefunding had not been deobligated and a file review would commence. A telephonic meetingwas scheduled for November 26, but was changed several times by USDA as they continued toreview their files.

On November 25, we were advised by phone that delays were due to file review and internalconsultation. We were advised that because the project had been started and completed beforeresolving all matters, based on a prior determination by USDA National Office, funding would notbe provided and that there was a process of appeal. We met with the City Manager and FinanceDirector to advise of this, and that we would likely have to go through the appeals process.

As we had not received a response to our May 2012 inquiry on the loan documents, and USDAhad amended the LOC in February 2012, after construction was completed, we did not completethe process of submitting other USDA LOC documents, pending the request to further amend theLOC.

Subsequently, on December 8, USDA advised based on their internal handling of a loan to Nomein 2006, there were specific requirements that the loan and companion grant could not be closeduntil all LOC items were met and that construction could not begin until Rural Development gaveauthorization to proceed. Based on construction being complete and other documentation/procedures in the LOC not having been met, they could not fund the project.

With an inclination this funding could be in jeopardy, in November NJUS submittedquestionnaires to the ADEC clean water and drinking water program to seek potential loanfunding under their open period for amending the current year Intended Use Plan (IUP), abovethat which had been already approved as amendment requests ($1.3MM)to the loans for currentyear sclaircore replacement. These questionnaires were scored and included in the IUP, withadditional funding of $3.7MM available above the amendment amount,

Under the USDA funding, the Utility would have had required annual loan payments ofapproximately $60,000 plus the requirement to deposit $173,017 into a SLA reserve, orapproximately $15 per water/sewer customer per month for 40 years. Under the alternatefunding through ADEC, the annual requirement for 20 years would result in a requirement ofbetween $4.50 and $6.81 depending on whether additional project costs not included in theUSDA funding may also be loan eligible. Should ADEC amend their loan program to extend theterms to 30 years, the annual requirement comparative would be between $3.00 and $4.54.

it is unfortunate USDA funding will not materialize. However, having now had an opportunity toreview in greater detail the ADEC loan option. Utility customers actually will benefit to a greaterdegree by utilizing ADEC (debt service and reserve requirements are $10/month less percustomer under AIEC than USDA>. Utilizing additional ADEC loan funding to “refinance” the 5th

Avenue project paid with operating funds is the only option available and with authorizingresolutions, can be applied for and reimbursements received in January 2015.

L”v

USDA — 5th Avenue

Submitted project application, Preliminary Engineering Report (PER), Environmental Report (ER>—summer 2010

Met with Misty on application — Nov/Dec 2010

USDA review of PER/ER previously submitted required updates; done with Lloyd Persson, CE2

Initial Letter of Conditions — May 2011

Pre-Construction meeting scheduled 7/6/11 — Advised USDA could not participate due tonotice/Misty out on emergency family leave.

Work commenced summer 2011

(rug and Persson in town to meet on project status— July 2011

Transition engineer from Persson to Erdman — fall 2011

Erdrnan met with HuH on SL revisions. Utility submitted requested changes to short livedassets schedule/reserve requirements — February 2012

Received amended letter of conditions — February 2012

Utility Board passed resolutions on financing— May 2012

Transmitted resolutions to Kruse, requesting clarification on loan documents/securityagreement — June 2012

Project review by Krug in Norne — March 2014

Requested meeting with Kruse to resolve outstanding issues; she was retiring and said it wouldhave to wait until later in year — April 2014

City Manager, Finance Director, Utility Manager contacted Hull — confirmed funds had not beende-obligated and she would review file — November 2014

Meeting scheduled with Hull to review outstanding issue on loan documents-securityagreement, and requested additional change to short lived asset schedule/reserve requirement—November 2014. Meeting times moved a couple of times as she had not been able tocomplete file review. Meeting scheduled for 11/26, but changed to 12/3 due to holiday.Requested that if there was another opening prior to 12/3, that we would like to meet as soonas possible.

Advised by phone 11/25 that delays were due to file review and internal consultation. Statedbeing work had been completed prior to resolving all matters, funding would not be provided,and that there was an appeals process. Delay had been while she reviewed file and workedwith National Office to determine what their response was going to be. To expect a letter.

Met with city manager & finance officer to advise of above.

Brief synopsis 12/2/14 /1 hand eland

EAST 5TH AVENUEPROJECT COSTING TOTAL

LaborMate na IsFreightEquip Rent-OthersEquip Rent-NJUSServicesLegalPermitsInspectionSuppliesSurveyingInterestCE2 EngineeringCE2 Const MgmtCE2 Core Crew

DEC 62766 - PAY REQUEST00-0 L’bor02-0 Freight03-0 Equip Rent-Others04-0 Equip Reni-NJUS

RESIDUAL (portion USDA planned)00-0 Labor01-0 Materials02-0 Freight03-0 Equip Rent-Others04-0 Equip Rent-NJUS05-0 Services06-0 Legal07-0 Permits

SuppliesSurveyingInterestCE2 EngineeringCE2 Const MgmtCE2 Core Crew

PORTION UNMATCHED IN DEC00-0 Labor02-0 Freight03-0 Equip Rent-Others

20,866.1153,106.40 1,263.50

53,731.951,962.40 79,023.18

115,001.74 1,082,264.12

2,2 50 .006,317.02 25,439.45

TOTAL821,029.49708,660.07113,567.82511,759.30249,346.15137,316.43

78.00506.12

2,250.00175,582.82

2,600.0020,866.1154,369.90

1S9,258.41194,540.21

3,151,730.83

GENJN. WATER70-0651 70-065212,347.92 322,364.19

177,635.6658.48 13,919.57

1,620.00 237,958.96112,313.83

14,810.09 11,648.3478.00

00-001-002-003-004-005-006-007-008-009-015-020-050-052-054-0

FIRE I-{YD70-0654

55,728.7822,154.71

2,263.9916,494.154,265.461,500.00

SVC LINES70-0655120,315.43174,370.8454,285.6617,392.2627,183.74

101,575.00

506.12

7,821.221,825.00

SEWER70-0653310,273.17334,498,8643,040.12

238,293.93105,583.12

7,783.00

63,987.69387.50

60,562.9661,799.43

1,226,209.78

72,017.44387.50

4,967.0012,288.83

125,979.94

39,996.5039,466.37

602,275.25

Inspection08-009-015-020-050-052-0

54-0

70-0651 70-0652 70-0653 70-06548,295.21 303,965.53 292,109.27 33,539.89 84,343.53 722,253.43

4,636.19 14,959.53 2,208.31 53,413.00 75,217.03783.00 218,908.13 219,243.10 2,905.37 15,102.73 456,942.33

117,222.87 110,421.94 2,521.20 26,850.26 257,016.279,078.21 644,732.72 636,733.84 41,174.77 179,709.52 1511,429.06

(1,058,000.00)

453,429.06

70-0651 70-0652 70-0653 70-0654 70-0655 IQIAI.4,052.71 18,398.66 18,163.90 22,188.89 35,971.90 98776.06

.- 177,635.66 334,498.86 22,154.71 174,370.84 708,660.0758.48 9,283.38 28,080.59 55.68 872.66 38,350.79

837.00 19,050.83 19,050.83 13,588.78 2,289.53 54,816.97- (4,909.04) (4,838.82) 1,744.26 333.48 (7,670.12)

14,810.09 11,648.34 7,783.00 1,500.00 101,575.00 137,316.4378.00

--

- - 78.00506.12

- -- - 506.12

--

- 2,250.00 2,250.007,821.22 72,017.44 63,987.69 6,317.02 25,439.45 175,582.821,825.00 387.50 387.50

- - 2,600.0020,866.11 - -

- - 20,866.1153,106.40 1,263.50

-- - 54,369.90

- 53,731.95 60,562.96 4,967.00 39,996.50 159,258.411,962.40 79,023.18 61,799.43 12,288.83 39,466.37 194,540.21

105,923.53 437,531.40 589,475.94 84,805.17 422,565.73 1,640,301.77

70-0651 70-0652 70-0653 70-0654 70-0655 IQIJ.291,589.27 84,343.53 375,932.80

4,636.19 14,959.53 2,208.31 53,413.00 75,217.031,045.00 1,045.00 189.35 2,279.35

- 5,681.19 307,593.80 2,397.66 137,756.53 453,429.18

TOTAL FOR LOAN CONSIDERATION 70-0651 70-0652 70-0653 70-0654 70-0655 TOTAL00-0 Labor 4,052.71 18,398.66 309,753.17 22,188.89 120,315.43 474,708.8601-0 Materials - 177,635.66 334,498.86 22,154.71 174,370.84 708,660.0702-0 Freight 58.48 13,919.57 43,040.12 2,263.99 54,285.66 113,567.82

03-004-005-006-007-008-009-015-020-050-052-054-0

Equip Rent-OthersEquip Rent-NJUSServicesLegalPermitsInspectionSuppliesSurveyingInterestCE2 EngineeringCE2 Const MgmtCE2 Core Crew

GEN/ENG WATER SEWER FIRE HYD SVC LINES70-0651 70-0652 70-0653 70-0654 70-0655

837.00 20,095.83 20,095.83 13,778.13 2,289.53- (4,909.04) (4,838.82) 1,744.26 333.48

14,810.09 11,648.34 7,783.00 1,500.00 101,575.0078.00 -

- -

506.12 - - - -

--

- 2,250.007,821.22 72,017.44 63,987.69 6,317.02 25,439.451,825.00 387.50 387.50 - -

20,866.11-

53,106.40 1,263.50 - -

- 53,731.95 60,562.96 4,967.001,962.40 79,023.18 61,799.43 12,288.83

105,923.53 443,212.59 897.069,74 87,202.83

DRiNKING WATERCLEAN WATER

TOTAL57,096.32(7,670.12)

137,316.4378.00

506.122,250.00

175,582.822,600.00

20,866.1154,369.90

159,258.41194,540.21

2,093.730.95

39,996.5039,466.37

560.322,26

52,961.77 443,212.59 87,202.83 280,161.13 863,538.3252,961.76 897,069.74 280,161.13 1,230,192.63

105,923.53 443,212.59 897,069.74 87,202.83 560,322.26 2,093,730.95

GEN/ENG WATER SEWER FIRE HYD SVC LINES70-0651 70-0652 70-0653 70-0654 70-0655 TOTAL

GEN/ENG WATER SEWER FIRE HYD SVC LINESSORTED BY DEC LOAN CLASS 70-0651 70-0652 70-0653 70-0654 70-0655 TOTAL DEC LOAI\j C20-0 Interest 1 20,866.11 - - -

- 20,866.11 23856

50-0 CE2 Engineering 2 53,106.40 1,263.50 - - - 54,369.90 54,359

06-0 Legal 3 78.00 --

- 78.0007-0 Permits 3 506.12

-

- 506.1208-0 Inspection 3

- 2,250.00 2,250.0015-0 Surveying 3 1,825.00 387.50 387.50 - 2,600.0052-0 CE2 Const Mgmt 3 - 53,731.95 60,562.96 4,967.00 39,996.50 159,258.4154-0 CE2 Core Crew 3 1,962.40 79,023.18 61,799.43 12,288.83 39,466.37 194,540.21 359232

01-0 Materials 4 - 177,535.66 334,498.86 22,154.71 174,370.84 708,660.0702-0 Freight 4 58.48 13,919.57 43,040.12 2,263.99 54,285.66 113,567.8203-0 Equip Rent-Others 4 837.00 20,095.83 20,095.83 13,778.13 2,289.53 57,096.3204-0 Equip Rent-NJUS 4 - (4,909.04) (4,838.82) 1,744.26 333.48 (7,670.12)05-0 Services 4 14,810.09 11,648.34 7,783.00 1,500.00 101,575.00 137,316.4309-0 Supplies 4 7,821.22 72,017.44 63,987.69 6,317.02 25,439.45 175,582.8200-0 Labor 4 4,052.71 18,398.66 309,753.17 22,188.89 120,315.43 474,709.86 1,659,262

105,923.53 443,212.59 897,069.74 87,202.83 560,322.26 2,093,730.95 2,093,730

GEN/ENG WATER SEWER FIRE HYD SVC LINESDRINKING WATER 70-0651 70-0652 70-0654 70-0655 IPL DEC LO i C20-0 Interest 1 10,433.05 -

-- 10,433.05 10,33

50-0 CE2 Engineering 2 26,553.20 1,263.50-

- 27,816.70 27,816

06-0 Legal 3 39.00 --

- 39.0007-0 Permits 3 253.06

-- 253.06

08-0 Inspection 3 --

- 1,125.00 1,125.0015-0 Surveying 3 912.50 387.50

-- 1,300.00

52-0 CE2 Const Mgmt 3 - 53,731.95 4,967.00 19,998.25 78,697.2054-0 CE2 Core Crew 3 981.20 79,023.18 12,288.83 19,733.18 112,026.39 193,440.

01-0 Materials 4 - 177,635.66 22,154.71 87,185.42 286,975.7902-0 Freight 4 29.24 13,919.57 2,263.99 27,142.82 43,355.6203-0 Equip Rent-Others 4 418.50 20,095.83 13,778.13 1,144.77 35,437.2304-0 Equip Rent-NJUS 4 - (4,909.04) 1,744.26 166.74 (2998.04)05-0 Services 4 7,405.05 11,648.34 1,500.00 50,787.50 71,340.8909-0 Supplies 4 3,910.61 72,017.44 6,317.02 12,719.73 94,964.8000-0 Labor 4 2,026.36 18,398.66 22,188.89 60,157.72 102,771.63 631,847.

52,961.77 443,212.59 - 87,202.83 280,161.13 863,538.32 863,538.

GEN/ENG WATER SEWER FIRE HYD SVC LINESCLEAN VLAT 70-0651 70-0652 70-0653 70-0654 70-0655 TOTAL DEC LOAN Ci20-0 Interest 1 10,433.06

-

- 10,433.06 10,433.

50-0 CE2 Engineering 2 26,553.20-

- 26,553.20 26,553.

06-0 Legal 3 39.00-

- 39.0007-0 Permits 3 253.06

- 253.0608-0 Inspection 3 - 1,125.00 1,125.0015-0 Surveying 3 912.50 387.50

- 1,300.0052-0 CE2 Const Mgmt 3 - 60,562.96 19,998.25 80,561.2154-0 CE2 Core Crew 3 981.20 61,799.43 19,733.19 82,513.82 165,792.

01-0 Materials 4 - 334,498.86 87,185.42 421,684.28

GENJENG WATER SEWER FIRE HYD SVC LINES70-0651 70-0652 70-0653 70-0654 70-0655 TOTAL02-0 Freight 4 29.24 43,040.12 27,142.84 70,212.2003-0 Equip Rent-Others 4 418.50 20,095.83 1,144,76 21,659.0904-0 Equip Rent-NJUS 4 - <4,838.82) 166.74 (4,672.08)05-0 Services 4 7,405.04 7,783.00 50,787.50 65,975.5409-0 Supplies 4 3,910.61 63,987.69 12,719.72 80,618.0200-0 Labor 4 2,026.35 309,733.17 60,157.71 371,937.23 1,02741

52,961.76 - 897,069.74 - 280,161.13 1,230,192.63 i9

DRINKING WATER 52,961.77 443,212.59 87,202.83 280,161.13 863,538.32CLEAN WATER 52,961.76 897,069.74 280,161.13 1,230,192.63105,923.53 443,212.59 897,069.74 87,202.83 560,322.26 2,093,730.95

Application Amend Available Add 5th Qv rINTENDED USE PLAN PROJECTS LISTEDDrinking Water 2,690,000 700,000 1,990,000 863,538.32 i,1)6t 6:Clean Water 2,340,000 600,000 1,740,000 1,230,192.63 509g0

5,030,000 1,300,000 3,730,000 2,093,730,95 1636,:Gc

Amend Add 5th Intal LoanDrinking Water 2,690,000 200,000 863,538.32 ] 563,53832 (1,126,461.68)Clean Water 2,340,000 600,000 J.,230,192.63 ,830,192.63 (509,807.37)

5,030,000 1,300,000 2,093 730.95 3,393,73095 (1,636,269.05)

20 yrs 65,000.00 [‘i04,686.55 169,686.55 2,093,730.951230 customers 50.78 81.79 132.57Per Month 4.23 6.82 11.05

30 yrs 43,333.33 69,791.03 113,124.371280 customers 33.85 54.52 88.38Per Month 2.82 4.54 7.36

USDA EXPECTED Grant 1,075,000.00Loan 308,000.00 Pay x 40 yrs 59,242.40 includes interest @ 3.75%

1,383,000.00 SLA Asset Require 173,017.00232,259.40

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NOME JOINT UTILITY SYSTEMEAST SCLA)RCORE REPLACEMENT

PHASE 2

Phase 2A 28 TotalProject Total Estimate 6,730,000 6,510,000 13,240,000

MMG 3,000,000 45% 4,557,000 70% 7,557,000 57%Match 3,730,000 55% 1,953,000 30% 5,683,000 43%

6,730,000 6,510,000 13,240,000

Total Match Required 5,683,000

Funding Sources:

Loan TotalEXISTING LOANS

SFY 2014 Amendwith

IUP Request

________________________________ ___________ ____________

Amendment

Drinking Water #627161 1,990,000 700,000 2,690,000

Clean Water p627141 1,740,000 600,000 2,340,000

3,730,000 1,300,000 5,030,000

EPA STAG 769,800

4,499,800

Additional Unmet Match Requirement 1,183,200Contingency 10% 118,320

1,301,520

/jkh08/12/14

NOME JOINT UTILITY BOARDMeeting Date: September 16, 2014

NJUS

Sclaircore Replacement — Phase II; ADEC Drinking Water & Clean Water Loan AmendmentsResolutions 14-07 & 14-08

NJUS applied for two municipal matching grants (MMGs) for Sclaircore Replacement Phase 2,for two phases to replace water-sewer utilities in the east quadrant of town, from Front to 6Ibetween N and K streets. The State awarded funding for Phase 2A in the amount of $3.OMMand Phase 2B in the amount of $4.557MM, the total of which represented 57% of the project.(Nome is eligible for up to 70% match, but in our initial application DEC limited the award to$3.OMM-typically their grant limit (only 45%), although we were successful in making the casefor 70% funding in the second application.

Concurrent with the initial MMG application, the Utility submitted loan questionnairesequivalent to the amount of Phase 2A to be considered for funding under the Alaska DrinkingWater and Clean Water Loan Programs. These questionnaires successfully rated and wereincluded in the respective program’s Intended Use Plans (IUP). The Drinking Water Fund loanof $1,990,000 included a 50% subsidy (loan forgiveness) component. The Clean Water Fundloan of $1,740,000 included approximately 10% subsidy.

NJUS continued to seek out additional potential funding from federal sources to provideadditional matching funds for Phase 2B. We were not successful in our quest with USDA duringthis round, but did capture $769,800 in EPA funding for the project. This left a residual fundingneed of $1.2MM to fully match the state grants.

ADEC was contacted and will amend the existing drinking water and clean water loans for Phase2 to provide the additional match funding required.

When considering the amount of subsidy (loan forgiveness) and the EPA funding used, the netresult raises the grant percentage from 57% to 72% of the projects.

Recommended action:

That Resolutions 14-07 and 14-08 be adopted, amending the Phase 2 ADEC Drinking Water andClean Water Loans to provide the additional matching funds required as match to awardedmunicipal matching grants. This funding mechanism was discussed previously and the addeddebt service requirement was considered during the rates adjustment implemented earlier thisyear.

i. Handeland09/15/14

Presented By:Utility ManagerAction Taken:

No°Abstain.

CITY OF NOME, ALASKA

RESOLUTION NO. R-14-lo-oz

A RESOLUTION APPROVING & ACCEPTING AN AMENDED LOAN FROM THEALASKA DEPT. OF ENVIRONMENTAL CONSERVATION ALASKA

DRINKING WATER FUND TO PROVIDE FINANCING FOR IMPROVEMENTS TOCOMMUNITY WATER INFRASTRUCTURE

WHEREAS, the Nome Joint Utility Board determined application should be submitted to theAlaska Department of Environmental Conservation Drinking Water Fund Program to finance variousinfrastructure improvements to water and sewer systems, including replacements, extensions andenhancements; and,

WHEREAS, the Alaska Department of Environmental Conservation has Alaska Clean Water& Alaska Drinking Water Fund loan programs with terms up to 20 years with no prepaymentpenalties to provide low interest (1.5%) financing to communities for water and sewer systems andNJUS submitted annual questionnaires to be included on the Intended Use Plans for these ADECprograms; and,

WHEREAS, by Resolution R-13-o5-oz, as recommended by Nome Joint Utility BoardResolution 12-04, a loan was authorized for Project #6z7161 — East Nome Water Replacement —

$1,990,000, ofwhich $995,000 was subsidized (converted to a grant); and,

WHEREAS, the initial loan was made to provide partial funding for Sclaircore ReplacementPhase iA, additional federal funds were awarded, and the existing loan only partially matches stategrants for Phase 2B, and the State is willing to amend the loan to provide additional funding to fullymatch the existing municipal matching grant for completion of Phase 2B;

NOW, THEREFORE, BE IT RESOLVED that the Nome City Council approves and acceptsan amended ADEC Drinking Water Fund Loan for the construction of water system improvementsfor a new total of $2,690,000 (of which $995,000 has been subsidized) with a 20 year payback at 1.5%interest, as recommended by Nome Joint Utility Board Resolution i-o7, and authorizes the UtilityManager as Chief Operating Officer of the Utility to execute any and all documents that may berequired by the Department to reflect the indebtedness, the terms of its repayment, and any securitythereof, including but not limited to an agreement for the loan and a promissory note.

APPROVED and SIGNED this j3t1 day of

ATTEST: .

TOM M RAN, Clerkf/If

DENISE MICHELS,

NOME JOINT UTILITY SYSTEM

NOME JOINT UTILITY BOARD

RESOLUTION 14-07

A RESOLUTION REQUESTING THE NOME COMMON COUNCIL APPROVE & ACCEPTAN AMENDMENT TO A LOAN FROM THE ALASKA DEPT. OF ENVIRONMENTAL

CONSERVATION ALASKA DRINKING WATER FUND TO PROVIDE LOAN FINANCING FORIMPROVEMENTS TO COMMUNITY WATER INFRASTRUCTURE

WHEREAS, The Utility Board determined application should be submitted toDepartment of Environmental Conservation Drinking Water Fundfinance various infrastructure improvements constructed to the watersystems, including replacements, extensions and enhancements; and,

the AlaskaProgram toand sewer

WHEREAS,

WHEREAS,

WHEREAS,

the Alaska Department of Environmental Conservation Alaska Clean Water &Alaska Drinking Water Fund loan programs offers terms up to 20 years with noprepayment penalties to provide low interest (1.5%) financing to communities forwater and sewer systems; and

NJUS submitted annual questionnaires to be included on the Intended Use Plansfor these ADEC programs, application was made, and ADEC provided an initialloan Project #627161 — East Nome Water Replacement — $1,990,000. Of thisamount, $995,000 was eligible for subsidy (repayment assistance) and convertedto a grant); and,

the initial loan application was made to provide partial funding for SclaircoreReplacement Phase 2A, additional federal funding was awarded, and the existingloan only partially matches state grants for Phase 2B, and the State is willing toamend the loan to provide additional funding to fully match the existing municipalmatching grant for completion of Phase 28;

NOW THEREFORE BE IT RESOLVED that the Nome Joint Utility Board requests the NomeCommon Council approve and authorize acceptance of additional $700,000, amending the existingADEC Drinking Water Fund Loan #627161, for the construction of water system improvements for anew total of $2,690,000 (of which $995,000 has been subsidized) with a 20 year payback at 1.5%interest, and authorize the Utility Manager as Chief Operating Officer of the Utility to execute anyand all documents that may be required by the Department to reflect the indebtedness, the terms ofits repayment, and an security thereof, including but not limited to an agreement for the loan and apromissory note.

SIGNEDTHIS JL DAYOF

___________

2014 AT NOME, ALASKA.

I1,-oVBerda Willson, ChairmanNOME JOINT UTILITY BOARD

avid Barron, ryNOME JOINT UTILITY BOARD

Presented By:Utility ManagerAction Taken:

YesNo

Abstain

CITY OF NOME, ALASKA

RESOLUTION NO. R-13-o5-02

A RESOLUTION APPROVING & ACCEPTING A LOAN FROM THE ALASKADEPT. OF ENVIRONMENTAL CONSERVATION ALASKA DRINKING WATER FUND

TO PROVIDE LOAN FINANCING FOR IMPROVEMENTS TOCOMMUNITY WATER INFRASTRUCTURE

WHEREAS, the Nome Joint Utility Board determined application should be submitted to theAlaska Department of Environmental Conservation Drinking Water Fund Program to finance variousinfrastructure improvements to water and sewer systems, including replacements, extensions andenhancements; and,

WHEREAS, the Alaska Department of Environmental Conservation has Alaska Clean Water& Alaska Drinking Water Fund loan programs with terms up to zo years with no prepaymentpenalties to provide low interest (1.5%) financing to communities for water and sewer systems andNJUS submitted annual questionnaires to be included on the Intended Use Plans for these ADECprograms; and,

WHEREAS, application was made and ADEC is prepared to enter in to an Agreement forProject #627161 — East Nome Water Replacement — $1,990,000, of which up to $995,000 15 eligible forsubsidy (repayment-conversion to a grant), and by Resolution 12-04 the Nome Joint Utility Systemrecommends the loan be accepted; and,

NOW, THEREFORE, BE IT RESOLVED that the Nome City Council approves and acceptsan ADEC Drinking Water Fund Loan for the construction of water system improvements in theamount of $1,990,000 with a 20 year payback at 1.5% interest, and authorizes the Utility Manager asChief Operating Officer of the Utility to execute any and all documents that may be required by theDepartment to reflect the indebtedness, the terms of its repayment, and any security thereof,including but not limited to an agreement for the loan and a promissory note.

APPROVED and SIGNED this 13th day of May,

__

LDISE MICHft. yIayor

fl//_Z:—)\J\__

TOM MORAN, Clerk

NOME JOINT UTILITY SYSTEM

NOME JOINT UTILITY BOARD

RESOLUTION 12-04

A RESOLUTION REQUESTING THE NOME COMMON COUNCIL APPROVE & ACCEPTA LOAN FROM THE ALASKA DEPT. OF ENVIRONMENTAL CONSERVATION ALASKADRINKING WATER FUND TO PROVIDE LOAN FINANCING FOR IMPROVEMENTS TO

COMMUNITY WATER INFRASTRUCTURE

WHEREAS, The Utility Board determined application should be submitted to the AlaskaDepartment of Environmental Conservation Drinking Water Fund Program torefinance various infrastructure improvements constructed to the water and sewersystems, including replacements, extensions and enhancements; and,

WHEREAS, the Alaska Department of Environmental Conservation has Alaska Clean Water &Alaska Drinking Water Fund loan programs with terms up to 20 years with noprepayment penalties to provide low interest (1.5%) financing to communities forwater and sewer systems and NJUS submitted annual questionnaires to beincluded on the Intended Use Plans for these ADEC programs; and,

WHEREAS, Application was made and ADEC is prepared to enter in to an Agreement forProject #627161 — East Nome Water Replacement — $1,990,000. Of this amount,up to $995,000 is eligible for subsidy (repayment-conversion to a grant).

NOW THEREFORE BE IT RESOLVED that the Nome Joint Utility Board requests the NomeCommon Council approve and accept an ADEC Drinking Water Fund Loan for the construction ofwater system improvements in the amount of $1,990,000 with a 20 year payback at 1.5% interest,and authorize the Utility Manager as Chief Operating Officer of the Utility to execute any and aHdocuments that may be required by the Department to reflect the indebtedness, the terms of itsrepayment, and an security thereof, including but not limited to an agreement for the loan and apromissory note.

SIGNED THIS DAY OF I , 2012 AT NOME, ALASKA.

4(‘. /

‘— /: tdBerda J. WiIIson ChairmanNOME JOINT UTILITY BOARD

ATTET— ;;—

David Barron, SecretaryNOME JOINT UTILITY BOARD