428-Revolving Loan Fund STATE OF FLORIDA
DEPARTMENT OF ENVIRONMENTAL REGULATION
WASTEWATER TREATMENT
REVOLVING LOAN FUND AGREEMENT
Florida Department of Environmental Regulation
Bureau of Local Government Wastewater Financial Assistance
Twin Towers Office Building
2600 Blair Stone Road
Tallahassee, Florida 32399-2400
WASTEWATER TREATMENT
REVOLVING LOAN FUND AGREEMENT
CONTENTS PAGE
ARTICLE I DEFINITIONS
1.01. WORDS AND TERMS. 1
1.02. CORRELATIVE WORDS. 3
ARTICLE II WARRANTIES, REPRESENTATIONS AND COVENANTS
2.01. WARRANTIES, REPRESENTATIONS AND COVENANTS. 3
2.02. CONDITIONS PRECEDENT° 5
ARTICLE III MONTHLY ESCROW AND LOAN REPAYMENT ACCOUNTS
3.01. MONTHLY ESCROW ACCOUNT. 5
3.02. INVESTMENT OF ESCROW MONEYS. 6
3.03. ESCROW WITHDRAWALS. 6
3.04. LOAN REPAYMENT RESERVE ACCOUNT. 6
3.05. LOAN REPAYMENT RESERVE WITHDRAWALS. 6
3.06. RESTORATION OF LOAN REPAYMENT RESERVE ACCOUNT, 6
3.07. INVESTMENT OF LOAN REPAYMENT RESERVE MONEYS. 6
ARTICLE IV PROJECT INFORMATION
4.01. PROJECT CHANGES. 6
4.02. TITLE TO PROJECT SITE. 7
4.03. PERMITS AND APPROVALS° 7
4.04. ENGINEERING SERVICES. 7
4.05. PROHIBITION AGAINST ENCUMBRANCES. 7
4.06. COMPLETION MONEYS. 7
4.07. SURPLUS LOAN FUNDS. 7
4.08. LOAN DISBURSEMENTS. 7
ARTICLE V HATES AND USE OF THE WATER AND SEWER SYSTEMS
5.01. RATE COVERAGE. 8
5.02. NO FREE SERVICE. 8
5.03. MANDATORY CONNECTIONS. 8
5,04. NO COMPETING SERVICE. 8
5.05. MAINTENANCE OF THE WATER AND SEWER SYSTEMS. 8
5,06. ADDITIONS AND MODIFICATIONS. 9
5,07. COLLECTION OF REVENUES. 9
ARTICLE VI DEFAULTS AND REMEDIES
6,01. EVENTS OF DEFAULT. 9
6.02. REMEDIES. 10 -
6.03. DELAY AND WAIVER. 10
ARTICLE VII THE PLEDGED REVENUES
7.01. SUPERIORITY OF THE PLEDGE TO THE DEPARTMENT. 11
7.02, ADDITIONAL DEBT OBLIGATIONS. 11
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CONTENTS PAGE
ARTICLE VIII GENERAL PROVISIONS
8.01. DISCHARGE OF OBLIGATIONS° 11
8.02. PROJECT RECORDS AND STATEMENTS. 11
8.03. ACCESS TO PROJECT SITE. 12
8.04. ASSIGNMENT OF RIGHTS UNDER AGREEMENT. 12
8.05. AMENDMENT OF AGREEMENT. 12
8.06. SEVERABILITY CLAUSE. 12
8.07. EXECUTION OF AGREEMENT. 12
ARTICLE IX PROJECT PROCUREMENT AND INSURANCE
9.01. PROCUREMENT PROCEDURES. 12
9.02. AUTHORIZATION TO AWARD CONSTRUCTION CONTRACTS. 13
9.03. SUBMITTAL OF CONSTRUCTION CONTRACT DOCUMENTS. 13
9.04. INSURANCE REQUIRED. 13
ARTICLE X CLEAN WATER ACT PROVISIONS
10.01. MINORITY AND WOMEN'S BUSINESS ENTERPRISE. 14
10.02. DAVIS-BACON LABOR WAGE PROVISIONS, 15
ARTICLE XI DETAILS OF FINANCING
11.01. PRINCIPAL AMOUNT OF LOAN. 15
11.02. EXACT FIGURES. 15
11.03. PROJECT SCHEDULE. 15
11.04. INTEREST RATE. 16
11.05. LOAN TERM 16
11.06. REPAYMENT SCHEDULE. 16
ATTACHMENT A: DESCRIPTION OF PLEDGED REVENUES. 18
ATTACHMENT B: PROJECT DESCRIPTION. 19
ATTACHMENT C: ESTIMATED LOAN DISBURSEMENT SCHEDULE. 20
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WASTEWATER TREATMENT
REVOLVING LOAN FUND. AGREEMENT
THIS AGREEMENT is executed by the STATE OF FLORIDA DEPARTMENT OF
ENVIRONMENTAL REGULATION (Department) and the CITY OF SANFORD, FLORIDA,
existing as a local government agency (Local Government) under the laws Of
the State of Florida.
WITNESSETH:
WHEREAS, pursuant to Section 403.1835, Florida Statutes, the Department
is authorized to make loans to local government agencies to finance or
refinance the construction of wastewater pollution control facilities, the
planning and design Of which have been reviewed by the Department; and
WHEREAS, the Local Government has made application for the financing of
the Project, and the Department has determined that such Project meets all
requirements for a loan;
NOW, THEREFORE, in consideration of the Department loaning money to the.
Local Government, in the principal amount and the covenants hereinafter set
forth, it is agreed as follows:
ARTICLE I- DEFINITIONS
1.01. WORDS AND TERMS. Words and terms used herein shall have the
meanings set forth below:
(1) "Additional Completion Loan" shall mean a loan subsequent to the Loan
authorized by this Agreement, which may be made to the Local Government by
the Department for the purpose of furnishing additional funds to complete the
Project. The interest rate for any Additional Completion Loan shall be
established pursuant to Chapter 17-503 of the Florida Administrative code.
(2) "Agreement" or "Loan Agreement" shall mean this agreement.
(3) "Annual Loan Payment" shall mean the payment due from the Local
Government to the Department in each Fiscal Year, and it is comprised of
principal and interest.
(4) "Authorized Representative" shall mean the official Of the Local
GOvernment authorized by ordinance or resolution to sign documents associated
with the Loan.
(5) "Capital Contribution" shall mean moneys from such sources as impact
fees, assessments, and contributions in-aid-to-construction.
(6) "Capitalized Interest" shall mean the total interest, which accrues
at the rate established for this Loan, for all disbursements from the date
of actual warrants until the date scheduled for construction Completion, at
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which time it will become part of the Loan principal. This interest shall be
recomputed as of the date established in the final amendment to this
Agreement in the event disbursements occur after the scheduled construction
completion date.
(7) "Cost of ConstrUction" shall mean the costs for furnishing and
installing, equipping, constructing, altering, remodeling, or improving
facilities° It shall also mean the cost of interim financing, refinancing,
or payment of other debt of the Local Government, the proceeds of which were
used for the foregoing purposes.
(8) "Depository" shall mean a bank or trust company, having a combined
capital and unimpaired surplus of not less than $50 million, authorized to
transact commercial banking or savings and loan business in the State of
Florida and insured by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation.
(9) "Loan" shall mean the amount of money to be loaned pursuant to this
Agreement°
(10) "Loan Repayment Reserve Account" shall mean the account into which
will be deposited the amount set aside to pay unexpected deficiencies, if
any, in the Annual Loan Payment.
(11) "Monthly Loan Deposit" shall mean the monthly deposit to be made by
the Local Government to an escrow account.
(12) "operation and Maintenance Expense" shall mean the costs of
operating and maintaining the Water and Sewer Systems determined pursuant to
generally accepted accounting principles, exclusive of interest on any debt
payable from Revenues; depreciation and any other items not requiring the
expenditure of cash; any amounts expended for capital replacements, repairs
and maintenance not recurring annually or reserves therefor; and reserves for
administration, operation and maintenance occurring in the normal course of
business.
(13) "Pledged Revenues" shall mean the specific Revenues pledged as
security for repayment of the Loan and shall be the Revenues derived yearly
from the Local Government's Subordinated ~ebt Service Fund funded by the
operation of the Water and Sewer Systems after payment of the Operation and
Maintenance Expense and the satisfaction of all yearly payment obligations on
account of the debt obligations identified on Attachment A to this Agreement.
Pledged Revenues are the specific Revenues pledged as security for repayment
of the Loan. Although such revenues q~ ~a~x_es are not pledged to repayment of
the Loan, for the purposes of Sections 5.01 and 7.02 only, the term Pledged
Revenues shall include any revenues or taxes of the Local Government pledged
to the debt obligations or proposed debt obligations referenced in Sections
5.01 and 7.02.
(14) "Project" sh~all mean facilities, consisting of the components needed
to meet present and estimated future requirements, as described in Attachment
B to this Agreement°
(15) "Revenues" shall mean all income or earnings received by the Local
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Government from the ownership or operation of its Water and Sewer Systems,
including investment income, all as calculated in accordance with generally
accepted accounting principles. Revenues shall not include proceeds from the
sale or other disposition of any part of the Water or Sewer Systems,
condemnation awards or proceeds of insurance, except use and occupancy or
business interruption insurance, received with respect to the Water or Sewer
Systems,
(16) "Sewer System" shall mean all facilities owned by the Local
Government for collection, transmission, treatment and reuse of wastewater
and its residuals.
(17) "Subordinated Debt Service Fund" shall mean the fund, created
pursuant to Local Governmental Resolution No, 1423, adopted October 7, 1985,
as amended and supplemented, in which Pledged Revenues shall be deposited.
(18) "water System" shall mean all facilities owned by the Local
Government for supplying and distributing water for residential, commercial,
industrial, and governmental use.
1.02. CORRELATIVE WORDS. Words of the masculine gender shall be
understood to include correlative words of the feminine and neuter genders.
Unless the context shall Otherwise indicate, the singular shall include the
plural and the word "person" shall include corporations and associations,
including public bodies, as well as natural persons. Capitalized words not
otherwise defined herein shall be defined as set forth in the Florida
Administrative Code, Chapter 17-503.
ARTICLE II- WARRANTIES, REPRESENTATIONS AND COVENANTS
2.01. WARRANTIES, REPRESENTATIONS AND COVENANTS. The Local Government
warrants, represents and covenants that:
(1) The Local Government has full power and authority to enter into this
Agreement and to comply with the provisions hereof.
(2) The Local Government is not presently subject to bankruptcy,
insolvency, or reorganization and is not in default of, or otherwise subject
to, any agreement or' any law, administrative regulation, judgment, decree,
note, resolution, charter or ordinance which would currently restrain or
enjoin it from entering into, or complying with, this Agreement.
{3) There is no material action, suit, proceeding, inquiry or
investigation, at law or in equity, before any court or public body, pending
or, to the best of the Local Government's knowledge, threatened, which seeks
to restrain or enjoin the Local Government from entering into or complying
with this Agreement.
(4) The Local Government shall not issue bonds, notes or other evidences
of indebtedness in any manner secured by Pledged Revenues without prior
written notification to the Department.
(5) The proceeds of any indebtednesS, which will be refunded or
refinanced by this loan, were used for the construction of this Project.
Refinancing, or reimbursement of the cost to issue and service such
indebtedness, shall be limited to net costs (expenses less investment
earnings).
(6) All permits, real property interests, and approvals required as of
the date of this Agreement have been obtained for construction and use of the
Project. The Local Government knows of no reason why any future required
permits or approvals are not Obtainable.
(7) The Local Government shall undertake the Proj.ect on its own
responsibility, to the extent permitted by law, and shall release and hold
harmless the State, its officers, members, and employees from any claim
arising in connection with the Local Government's actions Or omissions in its
planning, design, construction or operation Of the Project.
(8) All Local Government representations to the Department, pursuant to
the Loan application and Agreement, are true and accurate. To the extent
that any assurance, representation, or covenant requires a future action, the
Local Government shall take such action as is necessary for compliance.
(9) The financial information delivered by the Local Government to the
Department is current and correct. The Local Government shall provide the
Department with additional financial information via audits required by
Chapter 17-503 of the Florida Administrative Code, notification of changing
conditions adversely affecting the Local Government's ability to repay this
Loan, or upon request of the Department.
(10) The Local Government shall, as part of its bookkeeping system, keep
accounts of the Water and Sewer Systems separate from all other accounts and
it shall keep accurate records of all Revenues, Pledged Revenues, Capital
Contributions, Loan disbursement receipts, expenses, and expenditures
relating to the Water and Sewer Systems.
(11) The Local Government shall furnish, prior to the beginning of each
Fiscal Year, an annual budget setting forth the amount of Pledged Revenues
anticipated to be received; Revenues anticipated to be received from, and the
expenses to be incurred for, the operation of the Water and Sewer Systems;
provisions for the renewal and replacement of the Water and SewerI Systems;
and debt service payable from Water and Sewer Systems Revenues. A budget
shall be submitted for each year, beginning one year before the Project is
scheduled for construction completion and ending with the year during which
the loan is retired. In the event the anticipated Pledged Revenues are shown
by the budget to be insufficient to make the Annual Loan Payment for such
Fiscal Year when due, the Local Government shall include in such budget other
legally available funds which will be sufficient, together with the Pledged
Revenues,' to make the Annual Loan Payment. Such other legally available
funds shall be budgeted in the regular annual governmental budget and
designated for the purpose provided by this Subsection, and the Local
Government shall collect such funds for application as provided herein.
Nothing in this covenant shall be construed as (a) creating a pledge, lien,
or charge upon any such other legally available funds, nor (b) requiring the
Local Government to levy or appropriate ad valorem tax revenues, nor (c)
preventing the Local Government from pledging to the payment Of any bonds Or
other obligations all or any part of such other legally available funds,
nor (d) expending such funds for other governmental purposes, prior to such
application.
Beginning with the fiscal year during which the Loan is executed and for
each year until the Loan is retired, the Local Government shall have audited,
as part of the Single Audit Act, the accounts of the Water and Sewer Systems
and promptly furnish the audit to the Department. The audit shall also
address the Local Government's financial condition pursuant to Chapter 17-503
of the Florida Administrative Code~ The Local Government shall have the Loan
Agreement covenants reviewed as part of the audit process to ensure
compliance and establish, during the course of the examination, whether
anything came to the auditor's attention which would constitute a default.
The auditor shall verify that the Revenues collected, beginning no later than
the date set for construction completion, satisfy the rate coverage
requirements of this Agreement.
(12) The Local Government agrees to construct the Project in accordance
with the Project schedule. Delays incident to strikes, riots, acts of God,
and other events beyond the reasonable control of the Local Government are
excepted. If for any reason construction is not completed by the specified
completion date, there shall be no resulting diminutions or delay in the
Annual Loan Payment or the Monthly Loan Deposit or funding of the Loan
Repayment Reserve Account.
(13) The Local Government covenants that this Agreement is entered into
for the purpose of constructing, refunding, or refinancing the Project which
will in all events serve a public purpose. The Local Government covenants
that it will, under all conditions, complete and operate the Project to
fulfill the public need.
2.02. CONDITIONS PRECEDENT. As conditions precedent to this Agreement,
the Local Government shall deliver the following to the Department:
(1) A copy of all resolutions and ordinances authorizing this Agreement
and establishing the Local Government's legal right and authority to
undertake the Project.
(2) The opinion of counsel to the Local Government that this Agreement
has been duly authorized and executed and shall constitute a legal, valid,
and binding obligation in accordance with its terms upon execution by both
parties.
ARTICLE III- MONTBLy ESCROW AND LOAN REPAYMENT ACCOUNTS
3.01. MONTHLY ESCROW ACCOUNT. The Local Government shall establish a
monthly escrow account with a Depository. Beginning on the date of
construction completion (beneficial use), the Local Government shall make a
monthly deposit from the Pledged Revenues to the monthly escrow account.
In any month in which the amount on deposit in the monthly escrow account
does not equal or exceed five-sixths (5/6) of the Annual Loan Payment, the
Depository shall be required to promptly notify the Department in writing if
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the Local Government fails to make a monthly loan deposit which equals or
exceeds one-twelfth (1/12) of the Annual Loan Payment. In the event there is
an insufficient amount in the monthly escrow account thirty (30) days prior
to each Annual Loan Payment, the Local Government agrees to budget, by
amendment if necessary, payment to the Department from other legally
available funds all sums becoming due before the same become delinquent.
This requirement shall not be construed to give superiority to the
Department's claim on any Revenues over prior claims of general creditors of
the Local Government, nor shall it be construed to give the Department the
power to require the Local Government to levy and collect any Revenues other
than Pledged Revenues.
3.02. INVESTMENT OF ESCROW MONEYS. Upon the direction of the Local
Government, a Depository shall invest escrowed moneys pursuant to the laws of
the State of Florida. The maturity or redemption date of investments shall
be not later than the date upon which such moneys may be needed to make
Annual Loan Payments.
3.03. ESCROW WITHDRAWALS. The withdrawal of moneys from the monthl~
escrow account shall be for the purpose of making the Annual Loan Payment.
3.04. LOAN REPAYMENT RESERVE ACCOUNT. A Loan Repayment Reserve Account
shall be established with a Depository in the amount of fifteen (15) percent
of the Annual Loan Payment. The reserve shall be fully funded upon the
beneficial use date specified in this Agreement.
3.05. LOAN REPAYMENT RESERVE WITHDRAWALS. The Loan Repayment Reserve
Account shall be used by the Local Government to cure a temporary deficiency
in any Annual Loan Payment. The Depository shall be requiredto promptly
notify the Department upon any withdrawal from the Account. Any unused
portion of the Loan Repayment Reserve Account shall be used to reduce the
final Annual Loan Payment.
3.06. RESTORATION OF LOAN REPAYMENT RESERVE ACCOUNT. A default causing
the Local Government to use the Loan Repayment Reserve Account or the use of
the Account to prevent default shall result in the Local Government being
responsible for making special payments to restore its Loan Repayment Reserve
Account. special restoration payments shall be made from the first moneys
legally available to the Local Government for such purpose.
3.07. INVESTMENT OF LOAN REPAYMENT RESERVE MONEYS. Upon the direction of
the Local Government, a Depository shall invest reserved moneys pursuant to
the laws of the State of Florida. The maturity or redemption date of
investments shall be not later than the date set for Annual Loan Payments.
ARTICLE IV- PROJECT INFORMATION
4.01. PROJECT CHANGES. Project changes prior to bid opening shall be via
addendum to plans and specifications. Changes subsequent to bid opening
shall be by change order. The Local Government shall submit all addenda and
all change orders to the Department. Any addendum or change order which
affects the Project performance standards or which increases the contract
amount by more than one hundred thousand dollars ($100,000) or which alters
6
the Project purpose shall be submitted for written approvalby the
Department.
4.02. TITLE TO PROJECT SITE. The Local Government shall have an interest
in real property sufficient for the construction and location of the Project
free and clear of liens and encumbrances which would materially affect the
usefulness of such sites for the intended use.
4.03. PERMITS AND APPROVALS. The Local Government shall have obtained,
prior to the Department's authorization to award construction contracts, all
permits and approvals required for the construction of the Project or portion
of the Project funded under this Agreement. The Local Government shall
Obtain Operation permits, if applicable, when construction is complete.
4.04. ENGINEERING SERVICES. A professional engineer, registered in the
State of Florida, shall beemployed by, or under contract with, the Local
Government to oversee construction.
4.05. PROHIBITION AGAINST ENCUMBRANCES. The Local Government is
prohibited from selling, leasing or disposing of any part of the Water or
Sewer System which would materially reduce operational integrity, or
Revenues, so long as this Agreement is in effect unless the written consent
of the Department is first secured.
4.06. COMPLETION MONEYS. In addition to the proceeds of this Loan, the
Local Government covenants that it has obtained, or will obtain, sufficient
moneys from other sources to complete construction and place the Project in
operation on, or prior to, the date specified in Article XI. Failure of the
Department to approve an Additional Completion Loan shall not constitute a
waiver of the Local Government's covenants to complete and place the Project
in operation.
4.07. SURPLUS LOAN FUNDS. Upon execution of all construction contracts,
the Project contingency shall be reduced to not more than five (5) percent of
the sum of the as-bid prices for all construction contracts. After Project
performance certification by the Local Government, the Department will
establish the final Project costs to be financed by the Loan. The balance Of
funds remaining will be eliminated. The principal amount of the loan will be
similarly adjusted by the Department. This adjustment will reduce, on a pro
rata basis, an equal amount of the Annual Loan Payments.
4.08. LOAN DISBURSEMENTS. Disbursements shall be made only upon the
issue of warrants signed by the state Comptroller and only when the requests
for such warrants are accompanied by a Department certification that such
withdrawals are proper expenditures. The disbursement of moneys may be made
bY electronic means or by means of a magnetic tape or other transfer medium.
Disbursements shall be made directly to the Local Government for design and
administration allowances; reimbursement of the incurred Cost of Construction
and related services; establishing a loan repayment reserve upon beneficial
use; Project performance certification services; and final audit services.
Disbursements to the Local Government shall be made no more frequently than
monthly upon receipt of the following:
(1) A written request signed by the Authorized Representative. such
7
requests must be accompanied by sufficiently itemized summaries of the
materials, labor, or services to identify the nature of the work performed;
the cost or charges for such work; and the person providing the service or
performing the work,
(2) A certification signed by the Authorized Representative as to the
current estimated costs Of the Project; that the materials, labor, or
services represented by the invoice have been satisfactorily purchased,
performed, or received and applied to the Project; that all funds received to
date have been applied toward completing the Project; and that under the
terms and provisions of the contracts, the Local Government is required to
make such payments.
(3) A certification by the engineer responsible for overseeing
construction stating that equipment, materials, labor and services
represented by the construction invoices have been satisfactorily purchased,
or received, and applied to the Project in accordance with construction
contract documents; that payment is in accordance with construction contract
provisions; that construction, up to the point of the requisition, is in
compliance with the contract documents; and identifying all additions or
deletions to the Project which have altered the Project's performance
standards, scope, or purpose since the issue of the Department construction
permit° ~
(4) Such o'ther certificates or documents by engineers, attorneys,
accountants, contractors, or suppliers as may be reasonably required.
ARTICLE V- RATES AND USE OF THE WATER AND SEWER SYSTEMS
5.01. RATE COVERAGE. The Local Government shall maintain rates and
charges for the services furnished by the Water and Sewer Systems which will
be sufficient to provide, in each Fiscal Year, Pledged Revenues equal to or
exceeding 1.15 times the Annual Loan Payment and all debt service payments on
the debt obligations identified in Attachment A attached hereto.
5.02. NO FREE SERVICE. The Local Government shall not permit connections
to, or furnish any services afforded by, the Water or Sewer system without
making a charge therefor based on the Local Government's uniform schedule of
rates, fees, and charges.
5.03. MANDATORY CONNECTIONS. The Local Government shall adopt, as
necessary, and enforce requirements, consistent with applicable laws, for the
owner, tenant or occupant of each building located on a lot or parcel of land
which is served, or may reasonably be served, by the Water and Sewer Systems
to connect such building to the Water and Sewer Systems°
5.04. NO COMPETING SERVICE. The Local Government shall not allow any
person to provide any services which would compete with the Water or Sewer
System, as such systems exist as of the effective date of this Agreement, so
as to adversely affect Revenues.
5.05. MAINTENANCE OF TEE WATER AND SEWER SYSTEMS. The Local Government
shall operate and maintain the Water and Sewer Systems in a proper, sound and
economical manner and shall make all necessary repairs, renewals and
replacements.
5.06. ADDITIONS AND MODIFICATIONS. The Local Government may make any
additions, modifications or improvements to the Water and Sewer Systems which
it deems desirable and which do not materially reduce the operational
integrity of any part ~f the Water or Sewer System. All such renewals,
replacements, additions, modifications and improvements shall become part of
the Water and Sewer Systems.
5.07. COLLECTION OF REVENUES. The Local Government shall use its best
efforts to collect all rates, fees and other charges due to it. The Local
Government shall establish liens on premises served by the Water or Sewer
System for the amount Of all delinquent rates, fees and other charges where
~such action is permitted by law. The Local Government shall, to the full
extent permitted by law, cause to discontinue the services of the Water and
Sewer Systems and use its best efforts to shut off water service furnished to
persons who are delinquent beyond customary grace periods in the payment of
Water and Sewer Systems rates, fees and other charges.
ARTICLE VI~ DEFAULTS AND REMEDIES
6.01. EVENTS OF DEFAULT. Each of the following events is hereby declared
an event of default:
(1) Failure to fund the Lean Repayment Reserve or to make any Monthly
Lean Deposit or to make any installment of the Annual Loan Payment when it is
due and such failure shall continue for a period of thirty (30) days.
(2) Failure to comply with the provisions of this Agreement or in the
performance or observance of any of the covenants or actions required by this
Agreement other than as provided in Subsection 6.01(1), above, or Subsection
6.01(7), below, and such failure shall continue for a period of sixty (60}
days after written notice thereof to the Local Government by the Department.
(3) Any warranty, representation or other statement by, or on behalf of,
the Local Government contained in this Agreement or in any information
furnished in compliance with, or in reference to, this Agreement, which is
false or misleading in any material respect.
(4) An order or decree entered, with the acquiescence of the Local
Government, appointing a receiver of any part of the Water or Sewer System or
Revenues thereof; or if such order or decree, having been entered without the
consent or acquiescence of the Local Government, shall not be vacated or
discharged or stayed on appeal within sixty (60) days after the entry
thereof.
(5} Any proceeding instituted, with the acquiescence of the Local
Government, for the purpose of effecting a composition between the Local
Government and its creditors or for the purpose of adjusting the claims of
such creditors, pursuant to any federal or state statute now or hereafter
enacted, if the claims of such creditors are payable from Revenues of the
Water'~or Sewer System.
(6) Any bankruptcy, insolvency or other similar proceeding instituted by,
or against, the Local Government under federal or state bankruptcy or
insolvency law now or hereafter in effect and, if instituted against the
Local Government, is not dismissed within sixty (60) days after filing.
(7) Failure of the Local Government to give immediate written notice of
default to the Department and such failure shall continue for a period of
thirty (30) days.
6.02. REMEDIES. Upon any event of default and subject to the rights' of
others having prior liens on the Pledged Revenues, the Department may enforce
its rights by any of the following remedies:
(1) By mandamus Or other proceeding at law or in equity, cause to
establish rates and collect fees and charges for use of the Water and Sewer
systems, and to require the Local Government to fulfill this Agreement.
(2) By action or suit in equity, require the Local Government to account
for all moneys received from the Department or from the ownership of the
Water and Sewer Systems and to account for the receipt, use, application, or
disposition of the Pledged Revenues.
(3) By action or suit in equity, enjoin any acts Or things which may be
unlawful or in violation of the rights of the Department.
(4) By applying to a court of competent jurisdiction, cause to appoint a
receiver to manage the Water and Sewer Systems, establish and collect fees
and charges, and apply the revenues to the reduction of the obligations under
this Agreement.
(5) By certifying to the Comptroller delinquency on loan repayments, the
Department may intercept the delinquent amount plus six (6) percent,
expressed as an annual interest rate, penalty of the amount due to the
Department from any unobligated funds due to the Local Government under any
revenue or tax sharing fund established by the State, except as otherwise
provided by the State Constitution. Penalty interest shall accrue on any
amount due and payable beginning on the thirtieth (30th) day following the
date upon which payment is due.
(6) By notifying financial market credit rating agencies.
(7) By suing for payment of amounts due, or becoming due, with interest
on overdue payments together with all costs of collection, including
attorneys' fees.
(8) By accelerating the repayment schedule or increasing the interest
rate by as much as three (3) percent per annum on the unpaid principal of the
Loan for a default under Subsection 6.01(1).
6.03. DELAY AND WAIVER. NO delay or omission to exercise any right or
power accruing upon event of default shall impair any such right or power or
shall be construed to be a waiver of any such default or acquiescence
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therein, and every such right and power may be exercised as often as may be
deemed expedient. NO waiver or any default under this Agreement shall extend
to or affect any subsequent event of default, whether of the same or
different provision of this Agreement, or shall impair consequent rights or
remedies.
ARTICLE VII- THE PLEDGED REVENUES
7.01. SUPERIORITY OF THE PLEDGE TO THE DEPARTMENT. From and after the
effective date of this Agreement, the Department shall have a lien on the
Pledged Revenues prier and superior to any other lien, pledge or assignment
not specifically set forth in this Agreement. If the Loan is made in
accordance with an existing bond resolution authorizing additional Local
Government indebtedness with superior or parity liens On Pledged Revenues,
all obligations of the Local Government under this Agreement shall be
subordinate in right of payment to all bonds heretofore or hereafter issued
under said bond resolution. Any of the Pledged Revenues may be released from
the lien on such Revenues in favor of the Department if the Department makes
a determination, based upon facts deemed sufficient by the Department, that
the remaining Pledged Revenues will, in each Fiscal Year, equal or exceed
1.15 times the Annual Loan Payment coming due in each Fiscal Year under the
terms of this Agreement.
7.02. ADDITIONAL DEBT OBLIGATIONS. The Local Government may issue
additional debt obligations on a parity with, or senior to, the lien of the
Department on the Pledged Revenues ~i~h ~h~ ~rit~e~ con~e~t ~f_~he~De~a~tm~ent
if the Local Government demonstrates, at the time of issuance of such
additional debt obligations, that the Pledged Revenues plus revenuesto be
pledged to the additional proposed debt obligations will equal or exceed 1.15
times the annual combined debt service requirements of this Agreement plus
debt service On Other obligations proposed to be issued by the Local
Government.
ARTICLE VIII- GENERAL PROVISIONS
8.01. DISCHARGE OF OBLIGATIONS. All payments required to be made under
this Agreement shall be cumulative and any deficiencies in any FiScal Year
shall be added to the payments due in the succeeding year and all years
thereafter until fully paid. Payments shall continue to be secured by this
Agreement until all of the payments required shall be fully paid to the
Department° If, at any time, the Local Government shall have paid, or shall
have made provision for the timely payment of, the principal amount of the
Loan and interest required, the pledge of, and lien on, the Revenues to the
Department shall be no longer in effect. Deposit Of sufficient cash,
securities, or investments, authorized by law from time to time, may be made
to effect defeasance of this Loan. However, the deposit shall be made in
irrevocable trust with a banking institution or trust company for the sole
benefit of the Department. There shall be no penalty imposed by the
Department for early retirement of this Loan.
8.02. PROJECT RECORDS AND STATEMENTS. Books, records, reports, design
documents, contract documents, and papers shall be available to the
11
authorized representatives of the Department and the U.S. Environmental
Protection Agency's Inspector General for inspection at any reasonable time
after the Local Government has received a disbursement and before three (3)
years have elapsed after the Department's final Project disbursement to the
Local Government.
8.03. ACCESS TO PROJECT SITE. The Local Government shall provide access
to Project sites and administrative Offices to authorized representatives of
the Department at any reasonable time. The Local Government shall cause its
engineers and contractors to cooperate during Project inspections, including
making available working copies of plans and specifications and supplementary
materials.
8.04. ASSIGNMENT OF RIGHTS UNDER AGREEMENT. The Department may assign
any part of its rights under this Agreement after notification to the Local
Government, The Local Government shall not assign rights created by this
Agreement without the consent of the Department.
8.05. AMENDMENT OF AGREEMENT. This Agreement may be amended, except that
no amendment shall be permitted which is inconsistent with statutes, rules,
regulations, executive orders, or w~itten agreements between the Department
and the U.S. Environmental Protection Agency. This Agreement may be amended
after all construction contracts are executed to reestablish the Project
cost, Loan amount, Project schedule, and Annual Loan Payment. The final
amendment shall be executed after the final Project cost has been determined
by the Department, The final figures shall be determined after the
administrative close-out, which is to be held within six (6) months after the
date established for Project performance certification.
8.06. SEVERABILITY CLAUSE. If any provision of this Agreement shall be
held invalid or unenforceable, the remaining provisions shall be construed
and enforced as if such invalid or unenforceable provision had not been
contained herein.
8.07. EXECUTION OF AGREEMENT. This Agreement shall be executed in three
or more counterparts, any of which shall be regarded as an original and all
of which constitute but one and the same instrument. The Agreement becomes
effective upon execution.
ARTICLE IX- PROJECT PROCUREMENT AND INSURANCE
9.01. PROCUREMENT PROCEDURES. The Local Government shall obtain all
consulting services necessary for implementation of the Project consistent
with Chapter 287.055, F.S. The Local Government shall procure equipment,
materials, and construction contractors' services using the formal
advertising method; the use of competitively or noncompetitively negotiated
procurement requires prior written approval by the Department. The formal
advertising method requires the following:
(1) Adequate bidding documents shall be formally advertised in local and
statewide newspapers, giving adequate public notice such that a complete
description of what is required is stated; two or more responsible bidders
compete for the work; fixed-price contracts are used; and the selection of
12
the successful bidder is made principally on the basis of price. Certified
checks or bid bonds in the amount of five (5) percent of construction bids
shall be required for bid guarantees.
(2) Adequate bidding documents shall include statements of the required
work schedule; a clear explanation of the method of evaluating bid prices and
the basis for awarding contracts; prevailing wage rates to be used; and the
deadline and place to submit bids for public opening.
(3) The award of a contract shall be to the lowest, responsive,
responsible bidder. Contractors debarred, suspended or voluntarily excluded
from participating in federally assisted programs shall not be considered
responsible bidders. Participation of minority and women's business
enterprises in the work shall be considered in the award of contracts. All
bids may be rejected when in the best interest of the Local Government.
9.02. AUTHORIZATION TO AWARD CONSTRUCTION CONTRACTS. The following
documentation is required to receive the Department's authorization to award
construction contracts:
(1) Proof of advertising.
(2) Detailed bid tabulation and the award recommendation, certified by
the engineer responsible for overseeing construction.
(3) Certified copy of the.Local Government's tentative award resolution.
(4) Certification that affirmative steps were taken to encourage
participation of women's and minority business enterprises in Project
construction and documentation of the intended use of such enterprises
therein.
(5) Certification of compliance with the conditions of the Department's
approval of competitively or noncompetitively negotiated procurement.
9.03. SUBMITTAL OF CONSTRUCTION CONTRACT DOCUMENTS. After the
Department's authorization to award construction contracts has been received,
the Local Government shall submit bonding and insurance certifications,
construction and payment schedules, notices to proceed with construction,
itemized construction cost breakdowns, and executed contract documents.
9.04. INSURANCE REQUIRED. The Local Government shall require contractors
to file performance and payment bonds for the full amount of the contracts.
Insurance against all risks during the period of construction shall be
provided. Builder's risk or similar types of insurance in the amount of the
full replacement cost of the Project shall be provided to the extent that
such insurance is obtainable from time to time against any one or more of
such risks.
The Local Government shall cause the Project, as each part thereof is
certified by the engineer responsible for overseeing construction as
completed, and any other revenue producing facilities to be insured by an
insurance company or companies licensed to do business in the State of
Florida against such risks as are customary in connection with the operation
13
of revenue producing facilities Of like size, type and location in the
amounts recommended by an independent consultant to the extent such insurance
is obtainable from time to time against any one Or more of such risks.
The Local Government shall cause insurance to be obtained and maintained
against such risks as is customary during construction. Insurance
requirements include workers' compensation, comprehensive general liability,
contractors' indemnification Obligations, vehicle liability, and property.
Business interruption insurance for the revenue producing facilities may be
required by the Department.
As documentation of insurance coverage, the Local Governmentshall file
the following with the Department:
(1) A certification describing the performance and payment bonds of
contractors that have been retained for construction of the Project.
(2) A certification Of insurance specifically describing the Project and
the revenue producing facilities; stating that these facilities are covered;
stating the specific risks covered, the amount of coverage provided against
those risks, and whether the risks covered are those customarily insured
against in connection with the operation of revenue producing facilities of
like size, type and location to the extent that such insurance is obtainable
at the time of the certification; and that the insurance coverage is
adequate. This certification shall be updated annually as part of the
required audit.
(3) Such other certificates or documents by consultants, insurance
carriers, or Local Government officials concerning insurance coverage as may
reasonably be required by the'Department.
Notwithstanding the foregoing provisions, the Local Government may
institute and maintain actuarially sound and prudent self-insurance programs
with regard to such risks as shall be consistent with the recommendations of
a qualified insurance consultant.
The proceeds of insurance policies received as aresult of damage to, or
destruction of, facilities or structures which generate Pledged Revenues
(revenue producing facilities), shall be used to restore or replace damaged
portions of the facilities. If such proceeds are insufficient, the Local
Government shall provide additional funds to restore or replace the damaged
portions of the facilities. Repair, construction Or replacement shall be
promptly completed°
ARTICLE X- CLEAN WATER ACT PROVISIONS
10.01. MINORITY AND WOMEN'S BUSINESS ENTERPRISE. The Local Government
shall make reasonable efforts to encourage participation of minority and
women's businesses in construction of the Project. A goal of fourteen (14)
percent of the total cost for construction contracts plus the total value of
materials and equipment purchased for the Project is established for minority
and women's business contracts and subcontracts. Construction contracts
shall not be executed by the Local Government until the Department has
14
approved the extent of participation of minority and women's business
enterprises. Minority and women's business enterprise participation in
consulting services and other non-construction activities may be counted
toward achieving the goal. Documentation of efforts to utilize such persons
shall be maintained by the Local Government and its consultants and
contractors.
10.02. DAVIS-BACON LABOR WAGE PROVISIONS. The Local Government shall
enforce the minimum prevailing wage rates established for its locality by the
U.S. Department of Labor under the Davis-Bacon Act for Project construction.
ARTICLE XI- DETAILS OF FINANCIN8
11.01. PRINCIPAL AMOUNT OF LOAN. The amount of the Loan authorized is
Four Million Nine Hundred Twenty Nine Thousand Six Hundred Dollars
($4,929,600.00). Capitalized Interest in the amount of One Hundred Thirty
Eight Thousand Six Hundred Dollars ($138,600.00) is included in the principal
amount of the Loan but is not disbursed to the Local Government.
11.02. EXACT FIGURES. The Local Government and the Department
acknowledge that the actual cost of the Project has not been determined as of
the effective date of this Agreement. Project cost adjustments may be made
as a result of construction bidding or mutually agreed upon Project changes.
The final cost shall be established after all Project costs are reviewed
subsequent to Project performance certification. Changes in Project costs
may also occur as a result of the Local Government's Project audit or a
Department audit pursuant to Chapter 17-503 of the Florida Administrative
Code. The Local Government agrees to the following estimates for the Project
cost:
COST CATEGORY AMOUNT
(1) Administrative Allowance $ 22,825
(2) Design Allowance $ 295,000
(3) Construction and Demolition $ 4,565,000
(4) Equipment and Materials $ -0-
(5) contingencies $ 417,000
(6) Land $ -0-
(7) Technical Services During Construction
Contractual $ 235,000
Force Account $ -0-
(8) Loan Repayment Reserve $ 55,523
(9) Financing
Short Term $ -0-
Refinancing (Net cost) $ -0-
(10) Project Performance Certification $ 62,000
(11) Final Project Audit $ 20,000
(12) Capitalized Interest $ 138,600
TOTAL COST $ 5,810,948
11.03. PROJECT SCHEDULE. The Local Government agrees by execution
15
hereof:
(1) The last date by which formal advertising is to be published is
october 1, 1991.
{2) The last date by which bids are to be publicly opened is
November 1, 1991.
(3) The disbursement of design and administrative allowances will be made
upon request of the Local Government.
(4) The schedule for Loan disbursements is set forth in Attachment C
until such time as the contractors' construction schedules are available and
this Agreement is amended.
(5) The date by which construction is scheduled for completion
(beneficial use of the Project or portions thereof financed by this Loan) is
December 31, 1992.
(6) The date by which the Loan Repayment Reserve Account is to be
established by the Local Government and the date by which Monthly Escrow
Account payments are to begin is December 31, 1992.
(7) The date by which a request for the last Project construction
disbursement (construction cost cut-off date) is to be submitted to the
Department is March 31,'1993.
(8) The date by which Project performance is scheduled to be certified
and by which the first Annual Loan Payment becomes due is December 31, 1993.
(9) The date by which a request for the last Project nonconstruction
disbursement is to be submitted is January 31, 1994.
11.04. INTEREST RATE. The rate of interest on the unpaid principal of
the Loan is four and twenty three one-hundredths (4.23) percent per annum.
The rate Of interest shall be adjusted downward, if appropriate, pursuant to
the provisions of Section 17-503.430 of the Florida Administrative Code.
11.05. LOAN TERM. The Loan shall be repaid in twenty (20) Annual Loan
Payments.
11.06. REPAYMENT SCHEDULE. The first Annual Loan Payment shall be
computed based upon the principal amount of the Loan, as estimated under
Section 11.01, the estimated disbursement schedule identified in
Attachment C, and level debt service. The remaining nineteen (19) equal
installments shall be based upon the actual Project costs and actual dates
and amounts of disbursements to the Local Government after adjustment for any
overpayment, or underpayment, associated with the amount of the first
payment. Actual Project costs shall be established after the Local
Government's certification of Project performance, the Department's
16
inspection of the Project and associated records, and amendment of the Loan
Agreement. Until this Loan Agreement is amended, each Annual Loan Payment -
shall be in the amount Of Three Hundred Seventy Thousand One Hundred and
Fifty Four Dollars ($370,154.00). The interest portion of each Annual Loan
Payment shall be computed on the unpaid balance of the principal amount,
including Capitalized Interest, of the Loan. Annual Loan Payments shall be
received by the Department on or before December 31 of each year beginning in
1993. Funds transfer shall be madeby electronic means or by means of
magnetic tape when such transfer mechanisms are available.
IN WITNESS WEEREOF, the Department has caused this Agreement to be
executed on its behalf by the Secretary of the Department and the Local
Government has caused this Agreement to be executed on its behalf by its
o r e tl f e e of
reement ncor orate Atta hm nts A B
s c e
Ag i p , , and C hereto.
DEPARTMENT OF ENVIRONMENTAL REGULATION , , - F
City Manage/
CITY OF SANFORD
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
17
A~TACHMENT A: DESCRIPTION OF PLEDGED REVENUES
Pledged Revenues shall mean the Revenues derived yearly from the subordinated
Debt Service Fund, as identified in Resolution 1546, adopted by the City
Commission of the City of Sanford on May 8, 1989, and in Resolution 1423,
adopted by the City Commission of the city of Sanford on October 7, 1985, as
amended and supplemented after payment of the Operation and Maintenance
Expense and the satisfaction of all yearly payment obligations on account of
the debt obligations identified as follows:
(1) $16,975,000 City of Sanford Water and Sewer Revenue Bonds, series
1986, dated August 1, 1986, issued pursuant to Resolution 1423, adopted
by the City Commission of the City of sanford on October 7, 1985, as
amended and supplemented by subsequent resolution on July 25, 1986; and
(2) $4,410,000 City Of sanford Water and Sewer Revenue Bonds, Series
1989, dated September 1, 1989, and issued September 14, 1989, pursuant to
Resolution No. 1423 and Resolution No. 1546, as amended and supplemented.
These bonds were issued to refund the $3,795,000 Water and Sewer Revenue
Bond Anticipation Notes, Series 1987, dated August 1, 1987, and to pay
expenses incurred in issuing the Series 1989 bonds~
(3) Any of the $3,615,000 remaining authorized but unissued debt
obligations authorized pursuant to Resolution No. 1423 and Resolution No.
1546, as amended and supplemented.
(4) $11,970,000 City of Sanford Water and Sewer Revenue Bonds, Series
1991, dated August 1, 1991, and issued August 20, 1991, pursuant to
Resolution No. 1597, Resolution No. 1608 and Resolution No. 1609.
Said Revenues are available from operation of the Water and Sewer Systems.
18
ATTACHMENT B: PROJECT DESCRIPTION
The Project financed by this Loan, denoted by the Department's identifying
Number CS120586170, consists of three contracts and a portion of a fourth
contract which provide for the expansion of the Sanford Wastewater Reclamation
Facility, extension of the Local Goverament's reclaimed water reuse system,
and construction Of a discharge transmission main. The Project consists
specifically of the components detailed below.
1. The contract entitled "Seasonal Discharge Transmission Main" includes
construction of approximately 15,870 linear feet Of 20-inch-diameter
and approximately 270 linear feet of 18-inch-diameter effluent force
main from the Sanford wastewater treatment plant to a new
post-aeration structure at the St. Johns River; construction of
approximately 940 linear feet of 30-inch-diameter effluent gravity
line from the new post-aeration structure into the St. Johns River;
and modification of the existing dechlorination facilities.
2. The contract entitled "Water Reclamation Facility Expansion"
includes the construction of new aeration tanks; a new sludge
thickening/laboratory building (including a new 1.5 meter gravity
belt sludge thickener); a new maintenance building; chlorination
system improvements; rehabilitation of the existing aeration tanks;
demolition of the existing primary tanks and Special Structure No. 1;
construction of new bridges at existing Final Clarifier II and at the
existing digester building; replacement of three existing blowers
with four new blowers; renovation of the existing laboratory and
office building; and cleaning of the existing stormwater/reject water
holding ponds.
3. The contract entitled "Westerly Reclaimed Water Transmission system,
Contract II" includes construction of approximately 8,080 linear feet
of 16-inch-diameter reclaimed water transmission main; approximately
5,470 linear feet of 14-inch-diameter reclaimed water transmission
main; and approximately 140 linear feet of 12-inch~diameter reclaimed
water transmission main.
4. Those portions Of the contract entitled "Westerly Interceptor and
Reclaimed Water Transmission Mains, Contract I" involving the
construction of approximately 5,490 linear feet of 16-inch-diameter
reclaimed water transmission main in State Road 46 from Mangoustine
Avenue to Airport Road; the construction of approximately 170 linear
feet of 12-inch-diameter and 720 linear feet of 6-inch-diameter
reclaimed water transmission main in State Road 46 from Airport Road
to Bevier Road; and appurtenant work.
The project is in agreement with the Sanford 201 Facilities Plan Amendment
Number 2 dated February 1988 and the Westerly Interceptor Addendum dated May
1989. Approval of the project is provided by the Florida Finding of No
Significant Impact-Amendment dated April 12, 1991.
19
ATTACHMENT C: ESTIMATED LOAN DISBURSEMENT SCHEDULE
The schedule for disbursement of the Loan, including the Cost of Construction,
is as follows:
Date Amount
October 1991 318,000
November 1991 10,000
December 1991 400,000
January 1992 400000
February 1992 400000
March 1992 400000
April 1992 400000
May 1992 400 000
June 1992 4001000
July 1992 400.000
August 1992 400000
September 1992 242000
October 1992 240000
November 1992 117500
December 1992 181500
January 1993 2,500
February 1993 2,500
March 1993 2,500
April 1993 2,500
May 1993 2,000
June 1993 2,000
July 1993 2,000
August 1993 2,000
September 1993 2,000
october 1993 2,000
November 1993 30,000
December 1993 30,000
The total amount to be disbursed is $4,791,000. This amount is equal to the
Loan amount less Capitalized Interest.
20