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HomeMy WebLinkAboutCOW 2009-07-13 Item 5H - Resolution - Certificates for Cascade Water Alliance Official Statement for Cascade 2009 Bondscxyli,GoRy Disciission n Motion 1ltg Date 07/13/09 11 Lt Date SP( )NS()R'S SUMMARY Fund Fund Source: Comments MTG. DATE 7/13/09 E RI?Ou1RI?D MTG. DATE 7/13/09 COUNCIL AGENDA SYNOPSIS Initials Meetiizg Date Prepared by 1 Mayors ree'iev 1 Council reo;en' 07/13/09 SH 1 07/20/09 SH 1 ITEM INFORMATION CAS number 09-101 I ORIGINAL AGENDA DATE: JULY 13, 2009 \(,I:ND,\ hrl Trrl,l: A resolution authorizing the Mayor to execute certificates for the Cascade Water Alliance Official Statement for the Cascade 2009 Bonds. Z Resolution Ordinance Bid Award 1 1 Public Hearing n Other i\ltg Date 07/20/09 [lltg Date tl.itg Date Mtg Date .11 Its Date SI'( )NsoR 1 1 Council 1 1 Mayor Aetna Svcs DCD Finance n Fire Legal n P &R Police n P1V The resolution authorizes the Mayor to sign two Certificates related to the 2009 bond issue by Cascade Water Alliance. The bond issue, among other items, funds the purchase by CWA of Lake Tapps and provides for the settlement of water rights issues with local native groups. Repayment of the debt issuance has already been included in the water rate model by CWA. The Council is being asked to approve the resolution authorizing the Mayor to sign the Certificates. RI 11 WI :D [i n COW Mtg. 1 1 CA &P Cmte F &S Cmte Transportation Cmte Utilities Cmte Arts Comm. Parks Comm. DATE: 7/7/09 RECOMMENDATIONS: Sl'()NS()R /ADMIN. Finance Department CommITrl[? Unanimous Approval; Forward to Committee of the Whole COST IMPACT FUND SOURCE AMOUNT BUDGETED 1 RECORD OF COUNCIL ACTION Planning Comm. ATTACHMENTS Informational Memorandum dated 6/30/09 Resolution in Draft Form Certificate of the City of Tukwila Closing Certificate of the City of Tukwila Appendix A (for informational purposes only) Cascade Water Alliance bond planning (for informational purposes only) Minutes from Finance and Safety Committee meeting of 7/7/09 ITEM No. APPROPRIATION REQUIRED TO: ISSUE BACKGROUND DISCUSSION RECOMMENDATION City of Tukwila INFORMATIONAL MEMORANDUM Mayor Haggerton Rhonda Berry Finance and Safety Committee FROM: Shawn Hunstock, Finance Director DATE: June 30, 2009 SUBJECT: Cascade Water Alliance Bond Issue Certificates and Resolution Jim Haggerton, Mayor The Cascade Water Alliance (CWA) will soon be issuing approximately $96 million in bonds this summer. As a member of CWA, Tukwila must consent to continuing disclosure requirements that are typically part of a bond offering such as this. In the coming months CWA will be issuing bonds for several projects, as listed in the attachment titled Cascade Water Alliance bond planning: funding needs summary. The bulk of this money will be used for the purchase of Lake Tapps from Puget Sound Energy, and for the settlement of water rights issues with the Muckleshoot and Puyallup tribes. The attached Resolution authorizes the Mayor to execute the two included Certificates. The first Certificate, Certificate of City of Tukwila, essentially acknowledges that the City has provided certain operating information to be used in CWA's Offering Statement, Appendix A (Tukwila's Appendix A information is attached, for your information). This Certificate also requires the City to abide by continuing disclosure requirements. These include filing yearly Comprehensive Annual Financial Reports, which the City has to file anyway for our own bonds, and disclosure of certain significant material events, such as annexations. The second Certificate, Closing Certificate of the City of Tukwila, essentially acknowledges the City has disclosed to the bond underwriter material changes, if any, to the information already provided. Repayment of the $96 million in debt to be issued has already been included in the rate model for purchased water. As such, there will be no additional rate increase related to the debt service for this bond issue. The Council is being asked to approve the attached Resolution authorizing the Mayor to sign the two Certificates related to the CWA bond issue. INFORMATIONAL MEMO Page 2 This item is scheduled to be discussed at the July 7, 2009 Finance and Safety Committee meeting, the July 13, 2009 Committee of the Whole meeting and subsequent July 20, 2009 Regular Meeting. ATTACHMENTS Draft Resolution Certificate of the City of Tukwila Closing Certificate of the City of Tukwila Appendix A (for informational purposes only) Cascade Water Alliance bond planning (for informational purposes only) C:ltemp\XPg rpwiseU nfoMemoCWACertificates.doc A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, EXECUTING CERTIFICATES AND APPROVING FINANCIAL AND OPERATING INFORMATION OF THE CITY OF TUKWILA FOR THE CASCADE WATER ALLIANCE OFFICIAL STATEMENT FOR THE CASCADE 2009 BONDS. WHEREAS, Cascade Water Alliance "Cascade anticipates the issuance in August 2009 of its Water System Revenue Bonds, 2009 (the "Cascade 2009 Bonds and WHEREAS, under the Interlocal Contract effective April 1, 1999, as amended and restated on December 15, 2004, that established Cascade, the City of Tukwila (the "Member has agreed to provide "such certificates or verifications as are reasonably requested" in connection with the issuance of bonds by Cascade, including a written undertaking (an "Undertaking to provide continuing disclosure pursuant to paragraph (b)(5) of Securities and Exchange Commission Rule 15c2 -12; and WHEREAS, Member representatives have assisted Cascade in providing financial and operating information about the Member for inclusion in the official statement for the Cascade 2009 Bonds (the "Cascade Official Statement NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, HEREBY RESOLVES AS FOLLOWS: Section 1. The Mayor of Tukwila, as the Member's representative to and board member of Cascade, in connection with the issuance of the Cascade 2009 Bonds, is authorized to execute a certificate or certificates constituting the Undertaking, approving financial and operating information about the Member in the Cascade Official Statement, and including such other certifications or verifications as Cascade may reasonably request. PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Council Meeting thereof this day of 2009. ATTEST/ AUTHENTICATED: Christy O'Flaherty, CMC, City Clerk APPROVED AS TO FORM BY: Office of the City Attorney W \Word Processing Resolutions \Cascade 2009 Bonds Motion.DOC SH:ksn 07/09/2009 DRAFT Filed with the City Clerk: Passed by the City Council: Resolution Number: Attachments: Exhibit A Certificate of City of Tukwila Exhibit B Closing Certificate of City of Tukwila Joan Hernandez, Council President Page 1 of 1 CERTIFICATE OF CITY OF TUKWILA The City of Tukwila (the "City a code city and a member of the Cascade Water Alliance "Cascade hereby certifies to Cascade and to Lehman Brothers Inc. (the "Underwriter as set forth below. Capitalized terms used below but not defined have the meanings assigned thereto in the Bond Purchase Agreement (the "Purchase Agreement between the Underwriter and Cascade. 1. The City is a code city duly organized under the laws of the State of Washington (the "State and duly authorized to own and to operate its water system (which is identified in the Preliminary Official Statement) and to provide this Certificate (the "Certificate to Cascade and to the Underwriter. 2. The City has full legal right, power and authority: a. to execute and deliver this Certificate and to perform its obligations contained herein; b. to execute and deliver the Closing Certificate of the City (the "Member Closing Certificate c. to enter into the Amended and Restated Interlocal Contract, dated as of December 15, 2004 (the "Interlocal Contract" and together with this Certificate, the "Member Documents among Cascade and the members named therein (collectively, the "Members and d. to confirm the accuracy of the Member Infoimation defined below. 3. Attached to this Certificate are true and correct copies of the following documents: Resolution No. 1685, dated July 20, 2009, evidencing a motion authorizing the Mayor to sign the Member Documents; EXHIBIT A Resolution No. 1417, dated May 3, 1999, authorizing the Mayor to sign the original version of the Interlocal Contract; and Regular Meeting Minutes dated December 16, 2002, evidencing a motion authorizing the Mayor to sign the Amended and Restated Interlocal Contract. Such resolutions and motion were adopted at meetings duly convened and held in all respects according to law. To the extent required by law, due and proper notice of such meetings was given; a quorum was present throughout such meetings; a legally sufficient number of votes were cast in the proper manner for the adoption of such resolutions and motions. The resolutions and motion are in full force and effect as of the date hereof and have not been amended, superseded or repealed. 4. The City has duly authorized the execution and delivery by the City of each of the Member Documents, and each of the Member Documents has been fully authorized, executed and delivered by the City. 1 5. As of the date of the Preliminary Official Statement and as of the date of this Certificate, the information concerning the City contained in Appendix A (except the amount of the budgeted 2009 payments to Cascade, which are obtained from Cascade) and under the heading "THE MEMBERS City of Tukwila" in Cascade's Preliminary Official Statement (collectively, the "Member Information is true and correct. 6. Each of the representations and warranties of the City contained in the Member Documents is true and correct as of the date of this Certificate as if made on the date of this Certificate. 7. If, between the date of the Purchase Agreement and the date 25 days following the date of the Closing a. Any event shall occur or any pre- existing fact or condition shall become known to the City that might or that would cause the Member Information, as then supplemented or amended, to contain any untrue statement of a material fact, the City shall promptly notify Cascade thereof; and b. if, in the reasonable opinion of the Underwriter, such event, fact, or condition requires the preparation and publication of a supplement or amendment to the Official Statement, the City will provide to Cascade a supplement or amendment to the Official Statement in a form and in a manner approved by the Underwriter. 8. The execution and delivery by the City of this Certificate and of the Interlocal Contract do not conflict with, result in a breach of or constitute a default under any of the terms or conditions of any resolution, ordinance, mortgage, deed of trust, lease or other agreement or instrument to which the City is a party or by which it or any of its property is bound, or any laws, judgments, decrees, rules or regulations applicable to the City of any court or other governmental body or any other applicable requirement of law; and no consent, approval, authorization, order, permit, registration or qualification of or with any such court or governmental agency or body was or is required for the execution and delivery of wither of the Member Documents. 9. The City agrees to furnish such information, to execute such instruments and to take such other action in cooperation with the Underwriter and not inconsistent with law, as may be requested by the Underwriter to a. qualify the Bonds for offer and sale under the blue sky or other securities laws and regulations of such states and other jurisdictions of the United States of America as may be designated by the Underwriter and b. determine the eligibility of the Bonds for investment under the laws of such states and other jurisdictions and shall cooperate with the Underwriter to continue such qualifications in effect so longer as required for the distribution of the Bonds; provided, however, that in each case the City shall not be required to execute a general consent to service of process or to qualify to do business in connection with any such qualification or determination in any jurisdiction. 2 10. The City is not in material breach of or in default under the Interlocal Contract or in material breach of or in material default under any material agreement of the City's water utility, and no event has occurred and is continuing that constitutes or that with the passage of time or the giving of notice, or both, would constitute a material breach of or material default or event of default under any such material agreement. 11. In each year in which Member Charges the City is required to pay is 10 percent or more of the sum of the Member Charges paid by all of the Members in such year, the City will provide to Cascade, not later than the last day of the eighth month of each fiscal year of the City (but if either the City's or Cascade's fiscal year changes so that it ends on other than December 31, then no later than 30 days before Cascade's continuing disclosure is due), a. audited financial statements for the City for the prior fiscal year, prepared in accordance with generally accepted accounting principles applicable to Washington cities, and if audited financial statements are not available at that time, the City may provide unaudited financial statements with audited financial statements to be provided to Cascade when they become available; and b. updated Member Infoliiiation consisting of historical financial information and operating data for the City of the type included under the heading "THE MEMBERS Member and Regional Water Rates," and in Appendix A of Cascade's Official Statement. 12. The City confirms that it has not been in default on any of its debt obligations and further confirms that during the previous five years it has not failed to comply, in all material respects, with any previous undertakings in a written contract or agreement specified in paragraph (b)(5)(i) of the Rule. 13. The City agrees that any certificate signed by any officer of the City and delivered to the Underwriter shall be deemed to be a representation and warranty by the City to the Underwriter as to the statement made therein. 14. The officer of the City signing this Certificate is duly authorized to sign this Certificate on behalf of the City. 15. At the Closing, the City shall cause to be delivered to the Underwriter and to Cascade the opinion of counsel to the City and the Member Closing Certificate and the other documents and certificates required of the Member pursuant to Paragraph 7(e) of the Purchase Agreement. Dated this day of July, 2009. 3 CITY OF TUKWILA By: Title: City of Tukwila Washington Resolution No. '5 7 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AUTHORIZING THE MAYOR TO SIGN CASCADE WATER ALLIANCE INTERLOCAL CONTRACT, AND ASSIGNMENT AND ASSUMPTION OF WATER PURVEYOR CONTRACT WITH SEATTLE. WHEREAS, since 1993, elected officials from the City of Seattle, the Suburban Cities Association, and the King County Water Alliance have engaged in a facilitated negotiation to identify a new governance arrangement that would promote the cooperative use of water and enable the development of new regional water supplies; and WHEREAS, an arrangement encouraging discussion among three major partners in the region's water supply —the King County Water Alliance, Seattle Caucus, and the Suburban Cities Caucus "Tri- Caucus —was established; and WHEREAS, on August 30, 1995, the participants in that process executed a "Tri- Caucus Agreement of principles regarding the relationship between Seattle and the new Entity (Cascade Water Alliance)," which provided for cooperative planning, development, and management of regional water supplies; and WHEREAS, agencies are now proceeding to create, by interlocal contract, the Cascade Water Alliance, an intergovernmental body that will further the interests of its members while working cooperatively with other water supply entities in the region; and WHEREAS, the Cascade Water Alliance is an organization of municipalities formed for the purpose of obtaining and developing supplies of water for its members; and WHEREAS, the City of Tukwila is a municipality that supplies water to residents and customers within (and without) its municipal boundaries; and WHEREAS, an offer has been extended to the City of Tukwila to join the Cascade Water Alliance; and WHEREAS, a water audit has been completed for the City of Tukwila; and WHEREAS, the City Council of the City of Tukwila has voted to join the Cascade Water Alliance in order to assure its residents and customers continued water supply, and allow the City of Tukwila to actively participate in the operational planning and decisions of regional water system issues; CASCADE WATER ALLIANCE CONTRACT 4/29/99 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, HEREBY RESOLVES AS FOLLOWS: Section 1. Application to Cascade Water Alliance. A. The Mayor of the City of Tukwila is authorized on behalf of the City to execute the Cascade Water Alliance Interlocal Contract, a copy of which contract has been assigned Numberg in accordance with the terms and conditions of the application process adopted by the Cascade Water Alliance. B. The Mayor of the City of Tukwila is authorized on behalf of the City to execute that certain Assignment and Assumption of the Water Purveyor Contract with the City of Seattle, a copy of which Contract has been assigned Number O?2 PASSED BY THE CITY COUNCIL F THE CI OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this 3 day of 1999. V Dave Fenton, Council resident ATTEST /AUTHENTICATED: E. Cantu, CMC, City Clerk APPROVED AS T9,FORM: Office of the Clty Attyrney Filed with the City Clerk: 2 9- 9 9 Passed by the City Council: 5 S 9 Resolution Number V/ 7 CASCADE WATER ALLIANCE CONTRACT 4/29/99 City of Tukwila City Council Regular Meeting Minutes c. Byron Saunders Introduced by Ms. Lauterbach, Mr. Saunders is a long -time volunteer within the City and is glad to be a part of the Commission. HERNANDEZ MOVED; DUFFIE SECONDED; THE APPOINTMENT OF BYRON SAUNDERS TO THE EQUITY AND DIVERSITY COMMISSION, POSITION #9; WITH A TERM TO EXPIRE 07- 31 -05. The motion carried 6 0. 3. LIBRARY ADVISORY BOARD Arthur McCammon Although not present, Mr. Doerschel noted that Mr. McCammon is one of the original Library Advisory Board members and wishes to continue. LINDER MOVED; DUFFIE SECONDED; THE REAPPOINTMENT OF ARTHUR MCCAMMON TO THE LIBRARY ADVISORY BOARD, POSITION #1, WITH A TERM TO EXPIRE 12- 31 -04. The motion carried 6 0. CITIZEN COMMENT /CORRESPONDENCE: Jessie Richardson, 4632 South 148 Street, Tukwila, informed Council of an October 30 incident wherein King County Animal Control took her family dog into custody, after being found outside the fenced yard. The breed of the dog was in question (wolf hybrid or not) and the dog was ordered to remain in the care of King County until such a determination was made. Wolf hybrid dogs are not allowed within King County. After days of missed work, traveling from vets to others knowledgeable in the field of dog breeds, Internet review, hiring an attorney and appealing the matter, it was ordered the dog be returned to the Richardson home. It was found not to have been a wolf hybrid. Ms. Richardson incident arose. CONSENT AGE a. b. Page 2 of 6 December 16, 2002 spoke of concern for others who might not be able to afford an attorney when such an She spoke with a desire to "see change" in this area by the Council. NDA: Approval of Minutes November 18 and December 2 Regular Meetings Approval of Vouchers 240416- 240773, in the amount of $1,982,219.48 Authorize the Mayor to sign a renewal contract with 3H Cable Consultants, in the amount of $11,551.00, for Consultant Services in 2003 d. Authorize the Mayor to sign an Interlocal Agreement with Cascade Water Alliance UNDER MOVED; DUFFIE SECONDED; APPROVAL OF THE CONSENT AGENDA AS PRESENTED. The motion carried 6 0. BID AWARD: Award a contract to R. W. Scott Construction Company in the amount of $6,844,847.17, for construction of the Tukwila International Boulevard Street Improvement Phase I Project (South 152 to South 138 Street) Jim Morrow, Public Works Director, asked Council to award the construction contract for the Phase I work of the Tukwila International Boulevard project. The current value (total project costs) is $9,167,332.00; while the total budget dollars available (from all sources) are $8,680,800.00; leaving a deficit of $486,532.00. Mr. Morrow assured Council he would continue his recent efforts to negotiate options for reducing the budget deficit mentioned above. Such negotiations may take place with Seattle City Light and /or Puget Sound Energy (Natural Gas) and Qwest. After questioning items relative to tree planting and CLOSING CERTIFICATE OF THE CITY OF TUKWILA The City of Tukwila (the "City a code city and a member of the Cascade Water Alliance "Cascade hereby certifies to Cascade and to Lehman Brothers Inc. (the "Underwriter as follows (capitalized terms used below but not defined have the meanings assigned thereto in the Bond Purchase Agreement (the "Purchase Agreement between the underwriter and Cascade): 1. Each of the representations and warranties of the City contained in its Member Certificate is true and correct as of the date of this Closing Certificate as if made on the date of this Closing Certificate, and as of the date of this Closing Certificate, each of the representations and warranties contained in its Member Certificate is true and correct assuming that (i) where the phrase "the Preliminary Official Statement and the Official Statement" and (ii) the term "Member's Documents" includes this Closing Certificate as well as the member Certificate and the Interlocal Contract. 2. The City confirms its agreements contained in its Member Certificate, including in particular, the City's agreements contained in Paragraphs 7, 9 and 11 of the Member Certificate. 3. The officer of the City signing this Closing Certificate is duly authorized to sign this Closing Certificate on behalf of the City. Dated this day of July, 2009. 1 CITY OF TUKWILA By: Title: Mayor EXHIBIT B Highline water district intertie Water district 75 intertie Water district #75 intertie APPENDIX A: FINANCIAL INFORMATION REGARDING THE MEMBERS City of Tukwila Payments to Cascade The City of Tukwila's "Tukwila budgeted payments to Cascade for 2009 total $2,175,500, as follows: Administration Dues $67,222 Demand Share 1,662,900 New Water Surcharge RCFC 182,717 Conservation 41,697 Total $1,954,536 Tukwila Tukwila is located in the western portion of King County, just south of the City of Seattle. Tukwila was incorporated as a city in 1908 and encompasses approximately 8.6 square miles. Tukwila has an estimated population of 18,050, as of April 1, 2009, according to the State's Office of Financial Management. Tukwila is organized as a code city, governed by a mayor council form of government, with a seven member elected council. Tukwila's city council members are elected to overlapping four -year terms. The mayor is elected to serve in a full -time capacity, for a four year term. A city administrator and other officers and department directors are appointed by the mayor with approval of the council members. The city council has authority to set rates and charges for water service. Tukwila's Water Utility Tukwila is actively using reclaimed water for non potable uses such as irrigation from a separate system supplied by King County Department of Natural Resources. Tukwila's water transmission and distribution system includes forty miles of water mains, a two million gallon covered pre stressed concrete reservoir and booster pump station. Tukwila has several emergency interties with adjoining jurisdictions, cities, and water districts. Nearly all the water that Tukwila receives is purchased through Cascade. In 2008, Tukwila sold approximately 760 million gallons of water to approximately 2,100 accounts. The largest account represents 5 percent of the total water consumption and the top ten accounts represent approximately 27 percent of the total water consumption. Outstanding Debt Tukwila has a combined waterworks utility for purposes of financing, which includes water and sewer utilities. Only the revenues of the water utility are pledged under the Interlocal Contract. The revenues of the sewer utility are not pledged under the Interlocal Contract. At the end of 2008, the combined utility had $4,808,600 of outstanding water and sewer revenue bonds, and $4,554,087 of loans from the State's Public Works Trust Fund and $0. The bond ordinance for the water and sewer bonds currently has a debt service coverage requirement of 135 percent. Tukwila does anticipate incurring additional debt in the next 12 months. Debt Repayment Record Tukwila has promptly met all principal and interest payments of its bonds when due, and has never defaulted on a payment of principal or interest on any of its bonds. Furthermore, Tukwila has never issued refunding bonds for the purpose of avoiding an impending default. Continuing Disclosure During the previous five years, Tukwila has not failed to comply, in all material respects with any previous undertakings in a written contract or agreement specified in paragraph (b)(5)(i) of the Rule. Historical Operating Results The following table shows historical operating results for Tukwila. Tukwila has combined its water and sewer utilities for purposes of financing. Only the revenues of the water utility are pledged under the Interlocal Contract. For 2008 the water utility provided approximately 48 percent of the total operating revenues of the combined system. Statement of Revenues, Expenses, and Changes in Fund Net Assets Water /Sewer Utility For the year ended December 31 2008 2007 2006 2005 2004 8,603,765 8,168,646 7,648,522 7,604,133 7,619,234 18.143 6.741 5.437 578 1.338 8,621,909 8,175,387 7,653,959 7,604,711 7,620,572 Operating Revenue Charges for Services Other Operating Revenue Total Operating Revenues Operating Expenses Operations and Maintenance Administrative and General Taxes Depreciation Amortization Total Operating Expenses Operating Income (Loss) Non Operating Revenue (Expenses) Investment Income Interest Expense Amortization of Debt Premium Amortization of Debt Discount Other non Operating Rev. /Exp. Total Non Operating Rev. /Exp. Income (Loss) Before Contributions and Transfers Capital contributions Transfers in Transfers (out) Change in Net Assets Total Net Assets Beginning 5,701,671 5,488,380 5,185,919 4,882,923 4,606,999 136,436 128,549 999,398 1,048,963 1,031,643 261,188 245,908 233,290 229,550 237,769 953.552 726.347 697.289 704.709 646.937 7,052,846 6,589,184 7,115,896 6,866,145 6,523,348 1,569,062 1,586,203 538,063 738,566 1,097,224 232,657 399,125 398,891 200,104 125,680 (243,167) (360,491) (231,553) (218,544) (234,791) 10,797 10,807 8,412 8,206 8,205 (6,093) (6,919) (15,557) (16,579) (16,579) (2,0521 (3.556) (282) (7,858) 38,966 159,911 (26,813) (117,485) 1,561,204 1,625,169 697,974 711,753 979,739 633,415 341,126 184,786 218,519 183,122 97,260 (1,024.163) (911,789) (30.000) (43.128) (200.000) 1, 170,456 1,151 ,766 852,760 887,144 962,861 23,815,031 22,663,265 21,810,505 20,923,361 19,960,500 Total Net Assets Ending 24,985,487 23,815,031 22,663,265 21,810,505 20,923,361 S'ow ce: City of Tukwila. Cascade Water Alliance bond planning: funding needs summary Funding needed Max. Est. Amount 1. TCP Central and North Segments 2009 and 2010 $2,000,000 2. Eastside Storage Reservoir 2009 $15,000,000 3. Lake Tapps Acquisition September 2009 $43,000,000 4. Tribal settlement costs Sept. Dec. 2009 $19,800,000 5. State Route 900 Road Widening Reach July 2009 $7,132,000 6. Lake Tapps Knowledge Transfer May 2009 December 2010 $1,080,000 Subtotal $88,012,000 7. Reserve funding requirement $7,000,000 8. Transaction cost: Bond counsel $80,000 9. Transaction cost: Financial advisor $70,000 10. Transaction cost: Rating agencies $70,000 11. Transaction cost: Underwriter ($8/$1000) $705,000 12. Transaction cost: Underwriter's counsel Total financing $96,000,000 May 8, 2009 Cascade Water Alliance bond planning: funding needs 1. (E0) 2. (MG) May 8, 2009 Estimated need TCP (Central North Segments). The Tacoma Cascade Pipeline efforts are generally on hold pending the outcome of the 2009 planning study to update the Transmission and Supply Plan; 2010 Update. Ongoing work will take place by HDR for property acquisition and closeout of activities to enable the restart of the engineering work upon the completion of the 2009 planning efforts. Eastside Storage Reservoir. Estimated purchase price. Final cost to be determined based on conditions assessment and appraisal. RW Beck's draft report is under review. Reservoir serves Bellevue and Issaquah only. $1,000,000 to $2,000,000, depending on plans for Central Segment and whether 2008 Stewart property purchase is reimbursed from bond proceeds $15,000,000 ($11m SPU book value plus $4m land may be less) Estimated date funds needed 2009 -2010 2009 Timing, event triggers, requisites, other considerations HDR contract #3, Central Segment: $67,235 spent to date in 2009; remainder to be determined HDR contract #5, North Segment: $180,759 spent to date in 2009, $167,108 remaining in contract Easements ($81,727 total: BPA $73,030; Goodnight $1,070; Davis $5,645; PSE $1,582; Issaquah $400) Construction fund replenishment for Stewart purchase ($1,015,872) Noonan property (approx. $235,000; closing in June 2009) Timing is not critical for Cascade. Board has not yet discussed timing. Seattle's rate model assumes sale in 2009, so may get pressure from them to do it this year. December 2009 is possible. Annual operating costs est. '$50,000. Who will operate? Cascade Water Alliance bond planning: funding needs May 8, 2009 Lake Tapas acauisition. Puyallup Indian Tribes and Muckleshoot Indian Tribes settlement costs. 4. Muckleshoot: $600k due within ten days of closing on asset purchase agreement; $6.2m due within 60 calendar days (MG) after final appeal. Puyallup: $13m due within 45 calendar days of final water right issuance (after appeals). State Route 900 Road Widening Reach. The Tacoma Cascade Pipeline State Route 900 Road Widening contract with the Washington State Department of Transportation is 5. approximately $6.5 million, of which $1,390,114.56 has been (EO) spent in 2008 and 2009 (to be reimbursed from bond proceeds). The balance will be expended in 2009. Other expenses (contingency, project management, inspections, etc.) are estimated to total $682,000. $25m due at closing, which is 45 business days from satisfaction of contingencies /conditions for closing. 3. $5m due when water right is issued with settlement flows (earlier of issuance or closing) (MG) $7m $7.5m PSE operations from 2004 to mid -2009. Adjustments to purchase $4m reimbursement to PSE for construction costs. price; to be confirmed $1.5m PSE MOU purchase price adjustment. Estimated Timing, event triggers, requisites, Estimated need date funds needed $43,000,000 September $600,000 2009 December $19,200,000 2009 or later $7,132,000 other considerations Sixteen boundary line adjustments are in process. September Approval from UTC pending. 2009 Parties (Pierce Co., homeowners, 4 cities) may appeal water right. Appeal period is 30 days from issuance. Payment due per settlement agreements following issuance of water rights. Contract has been signed and construction is underway. July 2009 Payment will be in installments from March 2009 to July 2009. Cascade Water Alliance bond planning: funding needs 6. (MG) May 8, 2009 Lake Taaas knowledge transfer. Estimated cost of AECOM contract for Lake Tapps operations and assessment. Phase 1: $65,000 to scope the full project. Completed. Phase 2 -A: $715,000 evaluation of options and make recommendations, ends April 2010 Phase 2 -B: $300,000 implementations of recommended improvements, May 2010 December 2010 Total projects 7. Reserve funding requirement 8. Transaction cost: Bond counsel Transaction cost: Financial advisor 10. Transaction cost: Rating agencies 11. Transaction cost: Underwriter ($8/$1000) 12. Transaction cost: Underwriter's counsel 14. Total financing Estimated need $88,012,000 $7,000,000 $80,000 $70,000 $70,000 $705,000 $96,000,000 Estimated date funds needed May 2009 through $1,080,000 December 2010 Timing, event triggers, requisites, other considerations Need to confirm that this is capitalizable and therefore eligible for bond funding. Other notes: The "Short Term Supplemental Supply Projects" for $1,300,000 that appeared on prior version of this list has been removed. It is no longer a likely project. Another potential capital funding need: Lake Tapps powerhouse valve replacement, to occur within two or three years of closing (2010 probably), per the Compliance Schedule. Estimated cost is $2,000,000 ($1.5m equipment plus $500k installation). Lake Tapps Dike 3 repair may be done in conjunction with county road repair work, if the county funds it. If not, Cascade must submit a repair schedule to the Department of Ecology within three years. Bond proceeds may reimburse prior expenses paid from operating funds that were spent for the above projects, for the period back to three years prior to closing. These potential reimbursements to the Operating Fund may serve as contingency funding to cover needs that arise between the two bond phases. Ed Cebron will research reimbursement categories. May 8, 2009 FINANCE AND SAFETY COMMITTEE Meeting Minutes July 7, 2009, 5 :00 p.m.; Conference Room #3 PRESENT Councilmembers: Pam Linder, Chair; Joan Hernandez (sitting in for Joe Duffle) and De' Sean Quinn Staff: Shawn Hunstock, Nick Olivas, Don Tomaso, Mary Miotke, Don Lincoln, Rhonda Berry and Kimberly Matej Guests: Chuck Parrish and Jeremy Eide CALL TO ORDER: Chair Linder called the meeting to order at 4:59 p.m. I. PRESENTATIONS No presentations. II. BUSINESS AGENDA A. Ordinance Amending TMC Section 3.32 Increase in Purchasing Limits and Allow for Declarations of Emergencv Based on a request made by the Finance Safety Committee (see minutes dated June 2, 2009), staff is returning to Committee seeking full Council approval of an ordinance amending and adding to the Tukwila Municipal Code (TMC) in the following two areas: 1) Amend TMC 3.32.030 increasing the City purchasing limit, any amount above which, will require Council approval; 2) Add TMC 3.32.050 allowing for declaration of an emergency per the requirements of the Revised Code of Washington (RCW) 39.04.280(3). In regards to the amendment (number 1 above), the TMC currently requires that any City expenditure over $25,000 be approved by the City Council. This amount has remained unchanged since 1978. Staff is recommending that this amount be increased to $40,000 in order to streamline City financial processes. Shawn Hunstock reviewed additional checks and balances, limits and audit guidelines that will continue to ensure City financial processes are secure and transparent (i.e.: Mayoral approval of all purchases over up to $25,000, or $40,000, if changed; and continued voucher review by Councilmembers). Additionally, as of July 26, 2009, certain public works bid laws will take effect, increasing bid limits to $40,000. Increasing the City limit for all purchases to $40,000 from the current $25,000 will assist in encouraging consistency and preventing confusion in the purchasing process. The second item above, is an addition to the TMC, which will allow for appropriate purchases over the TMC required amount for Council approval when an emergency situation occurs as defined by RCW 39.04.280(3). Specifically, this will allow City departments to respond to natural disasters and other such emergencies efficiently without the requiring prior Council approval to make respective purchases, etc. Committee members were supportive of the addition to the TMC regarding emergency declarations (item number 2). However, they felt additional full Council discussion was needed for increasing the limit of purchases requiring Council approval. Therefore, this item will move forward to Council without a Committee recommendation. UNANIMOUS APPROVAL. FORWARD TO JULY 13 COW FOR DISCUSSION. City of Tukwila Finance and Safety Committee B. Cascade Water Alliance Bond Sale Resolution and Continuing Disclosure Agreement Staff is seeking full Council approval of a resolution authorizing the Mayor to sign two certificates relating to the 2009 Cascade Water Alliance (CWA) bond. Finance Safety Committee Minutes July 7, 2009 Paae 2 Cascade Water Alliance will be issuing approximately $96 million dollars in bonds for the purchase of Lake Tapps and for the settlement of water rights issues. As a member of Cascade Water, the City of Tukwila must give approval to continue providing disclosure of certain information which is required by the bond purchase agreement as well as provide financial and operating information for CWA's official statement. Rates already include repayment of this debt, meaning this item will not result in an additional increase in water rates. UNANIMOUS APPROVAL. FORWARD TO JULY 13 COW FOR DISCUSSION. C. Proceeds Distribution Hold Harmless Agreement for Sale of Jail Administrative Group (JAG) Property Staff is seeking full Council authorization for the Mayor to sign a Proceeds Distribution and Hold Harmless Agreement with the City of Bellevue for the recent sale of the Jail Administrative Group owned property located in Bellevue. Originally purchased jointly by JAG cities, this property is no longer needed for its intended purpose and was sold earlier this year. In order to receive the funding disbursement from this sale, all JAG cities must sign this Proceeds Distribution and Hold Harmless Agreement. This Agreement establishes the appropriate use of proceeds and consequences for misuse. It is estimated that the City of Tukwila will received approximately $287,000, all of which will be utilized for expenses relative to the SCORE jail (this funding must be used for jail purposes). UNANIMOUS APPROVAL. FORWARD TO JULY 13 COW FOR DISCUSSION. D. Fire Department Staff is seeking full Council approval to purchase mass casualty supplies (including: tools, trailers, equipment and medical supplies) from various vendors in the amount of $222,053.35. The funding for this purchase will come from the Fire Equipment Cumulative Reserve (Fund 107). Several years ago Sound Transit provided mitigation of approximately $1.5 million to the City for Fire Department purchases relative to the light rail project. The Fire Department has utilized portions of the mitigation to purchase such items as an aerial truck, fire hose and equipment all of which will assist with emergency responses involving link light rail. Approximately $328,000 remains from the original mitigation payment. Committee members requested several clarifications be made to the information memo which will go to full Council: Clarify the funding mechanism as South Transit mitigation funds Provide a grand total of the funds being requested reflecting the complete expenditure Give a brief history which shows the amount of funding the City received from Sound Transit, and what items have been purchased and respective costs. Staff further explained the rotation schedule for mass casualty supplies and equipment specifications and that state approved bidders' list. UNANIMOUS APPROVAL. FORWARD TO JULY 13 COW FOR DISCUSSION. E. Sales Tax Report: April 2009 Shawn Hunstock reviewed the April Sales Tax Report, noting that numbers showed a minimal improvement. Sales tax receipts continue to be below budget for the year. If receipts continue to remain at this level, the City may need to consider other options for addressing such financial issues. INFORMATION ONLY. III. MISCELLANEOUS Acting Committee Member Hernandez mentioned blogs that are utilized by the Seattle Police and Fire Departments and circulated front page samples of each. She commented that she would like to see the