REPORT TO COUNCIL
SUBJECT
Title
Approve Three Resolutions Enabling the City of Sunnyvale to Submit an Application to the State of California for up to $160 million in Clean Water State Revolving Funds to Fund the City of Sunnyvale - Headworks and Primary Treatment, Phase 1(A) Project
Report
BACKGROUND
The City has embarked on the most significant single public works program in its history, the rebuild of its aged Water Pollution Control Plant, which is responsible for the treatment of sewage from all of Sunnyvale and a small area inside the Cities of Cupertino and San Jose. Named the "Sunnyvale Clean Water Program", current cost estimates for this program are slightly over $450 million over approximately fifteen to twenty years.
In the planning phase for many years now, the program is now underway in design for the primary treatment facilities and headworks, which are the facilities that handle the incoming sewage, and begin the initial treatment process. Throughout the planning process, staff has included a placeholder in the City's Wastewater Management Fund long-term financial plan that estimates annual debt service associated with this program. This assumption has been based on a standard utility revenue bond financing.
Upon evaluating financing alternatives, staff identified that more favorable financing is available for a portion of the program through the State of California Clean Water Revolving Fund. In order to apply for this funding (the State has indicated that the City's funding request will be approved) Council must adopt three resolutions, which are further described below.
EXISTING POLICY
Council Fiscal Policy 7.11 Enterprise Fund Policies, 1.1b.1 Capital improvements associated with the existing infrastructure of a utility should be primarily funded from two sources: rate revenue and debt financing.
Council Fiscal Policy 7.11 Enterprise Fund Policies, 1.1b.3 Local, state and federal funding sources, such as grants and co...
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