Memorandum

City of Lawrence

Finance Department

TO:	Dave Corliss – City Manager
FROM:	Jeanette Klamm – Management Analyst
CC:	Dave Wagner – Director of Utilities Mike Lawless – Asst. Director of Utilities Philip Ciesielski – Asst. Director of Utilities Ed Mullins – Director of Finance
Date:	February 25 , 2014
RE:	Resolution No. 7062 Authorizing Water & Sewer Financing for 2014 CIP Projects

Please include the following item on the City Commission Agenda for consideration at the March 4, 2014 meeting:

Adopt Resolution No. 7062, authorizing the amount of $32,000,000 to fund the 2014 projects in the water and wastewater master plans, pay for issuance costs, and establish a debt service reserve fund. 

Issue one year General Obligation temporary notes to initially fund the projects.  The notes will then be permanently financed with water and sewer revenue bonds.

Background

The water and wastewater projects below were included in the water and wastewater master plans reviewed by the City Commission on March 12, 2013. They include all projects except the Oread Storage & Booster Pump Station, Kaw Structural and Mechanical, and Co-generation & Back up Power, which were included in the 2013 bond resolution. It is anticipated that the majority of the projects will be financed with a revenue bond to be repaid with revenues from the water and wastewater fund.  An estimated $2.0 million in cash may also be used to finance 2014 projects.

The projects will include some or all of the following activities study, design, property acquisition, construction, and construction services.

Water Projects	2014
19th & Kasold Pump Station	$411,000
Watermain Assessment, Relocation, Rehabilitation, Replacement	$4,588,260
Clinton Intake	$1,297,900
Plant Maintenance	$156,000
Taste and Odor/Clinton Process Improvements	$1,548,200
Total	$8,001,360

Wastewater Projects	2014
New Wakarusa WWTP, Influent Pump Station, and Force Mains (Authorized by Resolution 6717)	$14,892,800
Rapid Inflow/Infiltration Reduction Program	$2,415,000
Sewer Rehabilitation, Assessment, CIPP, Manholes	$432,600
Sanitary Sewer Relocation, Rehabilitation, Replacement, Pumps Stations, and General Improvements	$728,000
Total (excluding Wakarusa WWTP):	$3,575,600
Grand Total:	$26,469,760

Financing for the Wakarusa wastewater treatment plant was previously authorized by Resolution No. 6717.  The 2013 estimated cost for the project of $14.9 million is not included in this resolution, but will be included in the 2014 debt issue.  In addition to the project costs above, the City will need an estimated $65,240 in issuance cost and will need to fund a 10% debt service reserve.  As a result, it is recommended that the City Commission approve Resolution No. 7062, authorizing the amount of $32,000,000 to fund the 2014 projects in the water and wastewater master plans, pay for issuance costs, and establish a debt service reserve fund.  It is also recommended that the City issue one year General Obligation temporary notes to initially fund the projects.  The notes will then be permanently financed with water and sewer revenue bonds.

The Resolution must be published and a fifteen day protest period must expire prior to the execution of any construction agreements to begin the projects.

Current Project Status

Water and Wastewater Master Plan projects funded in part or total through Resolution No. 7019 in 2013 are currently underway. The following includes a summary of current projects and their status:

• UT1102KA Kaw WTP Supply Improvements – Bid awarded. Anticipate completion 6/14.
• UT1307 Oread Tanks – Evaluating site, scope, and options.
• UT1310 Booster Pump Station – Evaluating site, scope, and options.
• UT1403 Tank Rehab and Recoating – proposals received and recommendations for evaluation and options to City Commission in 3/14.
• UT0701 Kaw Transmission Main – Bid awarded. Anticipate completion 8/14.
• UT1313 Mississippi Street Water Main Replacement – In design.
• UT1314 Lawrence Ave. Water Main Replacement – In design.
• UT 1315 Arkansas Street Water Main Replacement – In design.
• UT1308 North Iowa Water Main Replacement – In design.
• UT1309 23^rd Street – Water Main Replacement – Phase 3 underway. Phase I bid awarded.
• UT1105/PW1202 Wakarusa Water Main Relocation – Complete.
• UT1401 In-House Water Main Replacement – In design.
• UT1209 Taste and Odor Study – Evaluation completed. Anticipate recommendation and report to City Commission in 3/14.
• UT1312 George Williams Way to Bob White – In design.
• UT1302CS Pump Station No. 4 Redundant Force Main – Bid awarded. Expected completion 5/14.
• UT1304 Wakarusa Wastewater Treatment Plant/Influent Pump Station/Force Main – Plant, pump station, and force main in design. Construction of force main, roadway, and site fill to begin 2014. Construction of plant and pump station to begin 2015.
• UT1311 Kansas River WWTP Microturbines – A final report analyzing compatibility, feasibility, and costs is being completed and will be submitted to the Commission for consideration.
• UT1305 Rapid Inflow/Infiltration Reduction Program – City and consultant are currently inspecting the city sanitary sewer in designated areas through smoke testing, manhole inspections, and flow monitoring. Evaluation of private sources of I&I are anticipated to begin in 2014.
• UT1212 Cured-in-Place-Pipe – Clay Pipe and Manhole Rehabilitation Program –Installed CIPP in 17,534 linear feet of sanitary sewer in 2013. Additional CIPP projects identified for 2014 completion.
• UT1205 South Lawrence Trafficway Water and Sanitary Sewer Relocations – Water line and sanitary sewer relocation due to construction of the South Lawrence Trafficway in progress.
• UT1210CS Bob Billings Parkway Water & Sanitary Sewer Relocations – Water line and Sanitary sewer relocation in conjunction with KDOT interchange at K-10 and Bob Billings Parkway in design. Construction in 2016.
• PW1012 Iowa Street Reconstruction Water and Sanitary Sewer Relocations – Complete.
• UT1316 Concrete Transmission Main Assessment – Testing underway. Evaluation report anticipated in 5/14.

Action Request

Adopt Resolution No. 7062, authorizing the amount of $32,000,000 to fund the 2014 projects in the water and wastewater master plans, pay for issuance costs, and establish a debt service reserve fund. 

Issue one year General Obligation temporary notes to initially fund the projects.  The notes will then be permanently financed with water and sewer revenue bonds.

Thank you for your assistance. Please advise if you have any questions.