989-FDEP Clean Water Loan STATE OF FLORIDA
DEPARTMENT OF ENVIRONMENTAL PROTECTION
AND
CITY OF SANFORD, FLORIDA
CLEAN WATER STATE REVOLVING FUND
LOAN AGREEMENT
SWG12058624P
Florida Department of Environmental Protection
Bureau of Water Facilities Funding
Twin Towers Office Building
2600 Blair Stone Road, MS 3505
Tallahassee, Florida 32399-2400
CLEAN WATER STATE REVOLVING FUND LOAN AGREEMENT
CONTENTS
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ARTICLE I - DEFINITIONS
1.01. WORDS AND TERMS.
1.02. CORRELATIVE WORDS.
ARTICLE II - WARRANTIES, REPRESENTATIONS AND COVENANTS
2.01. WARRANTIES, REPRESENTATIONS AND COVENANTS.
2.02. LEGAL AUTHORIZATION.
2.03. AUDIT AND MONITORING REQUIREMENTS.
ARTICLE IE - LOAN REPAYMENT ACCOUNTS 3.01. LOAN DEBT SERVICE ACCOUNT.
3.02. INVESTMENT OF LOAN DEBT SERVICE ACCOUNT MONEYS.
3.03. LOAN DEBT SERVICE ACCOUNT WITHDRAWALS.
3.04. LOAN REPAYMENT RESERVE ACCOUNT.
3.05. LOAN REPAYMENT RESERVE WITHDRAWALS.
3.06. RESTORATION OF LOAN REPAYMENT RESERVE ACCOUNT.
3.07. INVESTMENT OF LOAN REPAYMENT RESERVE MONEYS.
3.08. ASSETS HELD IN TRUST.
ARTICLE IV - PROGRAM INFORMATION
4.01. PROJECT CHANGES.
4.02. TITLE TO PROJECT SITE.
4.03. RESERVED.
4.04. RESERVED.
4.05. PROHIBITION AGAINST ENCUMBRANCES.
4.06. COMPLETION MONEYS.
4.07. CLOSE-OUT.
4.08. LOAN DISBURSEMENTS.
ARTICLE V - RATES AND USE OF THE STORMWATER SYSTEM
5.01. RATE COVERAGE.
5.02. MAINTENANCE OF THE STORMWATER SYSTEM.
5.03. ADDITIONS AND MODIFICATIONS.
5.04. COLLECTION OF REVENUES.
ARTICLE VI - DEFAULTS AND REMEDIES
6.01. EVENTS OF DEFAULT.
6.02. REMEDIES.
6.03. DELAY AND WAIVER.
ARTICLE VII - THE PLEDGED REVENUES
7.01. SUPERIORITY OF THE PLEDGE TO THE DEPARTMENT.
7.02. ADDITIONAL DEBT OBLIGATIONS.
ARTICLE VIE - GENERAL PROVISIONS
8.01. DISCHARGE OF OBLIGATIONS.
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CLEAN WATER STATE REVOLVING FUND LOAN AGREEMENT
CO~ENTS
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8.02. RECORDS AND STATEMENTS.
8.03. ACCESS TO WORK SITE.
8.04. ASSIGNMENT OF RIGHTS UNDER AGREEMENT.
8.05. AMENDMENT OF AGREEMENT.
8.06. ANNULMENT OF AGREEMENT.
8.07. SEVERABILITY CLAUSE.
ARTICLE IX - RESERVED
ARTICLE X - DETAILS OF FINANCING
10.01. PRINCIPAL AMOUNT OF LOAN.
10.02. LOAN SERVICE FEE.
10.03. INTEREST AND GRANT ALLOCATION ASSESSMENT RATES.
10.04. LOAN TERM.
10.05. REPAYMENT SCHEDULE.
10.06. PROJECT RELATED COSTS.
10.07. SCHEDULE.
ARTICLE XI - EXECUTION OF AGREEMENT
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CLEAN WATER STATE REVOLVING FUND LOAN AGREEMENT
SWG12058624P
THIS AGREEMENT is executed by the STATE OF FLORIDA DEPARTMENT OF
ENVIRONMENTAL PROTECTION (Department) and the CITY OF SANFORD, FLORIDA, (Local
Government) existing as a local governmental agency 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 the planning, design, and construction of stormwater pollution
control facilities; and
WHEREAS, the Local Government has made application for the financing of Preconstruction Activities,
and the Department has determined that all requirements for a loan have been met.
NOW, THEREFORE, in consideration of the Department loaning money to the Local Government, in the
principal amount and pursuant to 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) "Agreement" or "Loan Agreement" shall mean this agreement.
(2) "Authorized Representative" shall mean the official of the Local Government authorized by
ordinance or resolution to sign documents associated with the Loan.
(3) "Capitalized Interest" shall mean the interest accruing on Loan proceeds from the time of
disbursement until six months before the first Semiannual Loan Payment is due. Capitalized Interest is
financed as part of the Loan principal.
(4) "Construction Related Costs" shall mean costs for Project construction, equipment,
materials, demolition, contingency, legal and technical services incurred after construction bid opening,
and the incremental portion of the Loan repayment reserve disbursement (if applicable) and Capitalized
Interest associated with the foregoing costs.
(5) "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.
(6) "Grant Allocation Assessment" shall mean an assessment, expressed as a percent per
annum, accruing on the unpaid balance of the Loan. It is computed similarly to the way interest charged
on the Loan is computed and is included in the Semiannual Loan Payment. The Department will use
Grant Allocation Assessment moneys for making grants to financially disadvantaged small communities
pursuant to Section 403.1835 of the Florida Statutes.
(7) "Gross Revenues" shall mean stormwater utility fees and all income and earnings received
by the Local Government from the ownership or operation of its Stormwater System, including
investment income, all as calculated in accordance with generally accepted accounting principles. Gross
Revenues shall not include proceeds from the sale or other disposition of any part of the Stormwater
System, condemnation awards or proceeds of insurance, except use and occupancy or business
interruption insurance, received with respect to the Stormwater System.
(8) "Loan" shall mean the amount of money to be loaned pursuant to this Agreement and
subsequent amendments.
(9) "Loan Application" shall mean the completed form which provides all information required
to support obtaining loan financial assistance from the Department.
(10) "Loan Debt Service Account" shall mean an account, or a separately identified component
of a pooled cash or liquid account, with a Depository established by the Local Government for the
purpose of accumulating Monthly Loan Deposits and making Semiannual Loan Payments.
(11 ) "Loan Repayment Reserve Account" or "Loan Repayment Reserve" shall mean the account
into which will be deposited the amount set aside to pay temporary and unexpected deficiencies, if any,
in the Semiannual Loan Payment.
(12) "Loan Service Fee" shall mean an origination fee which shall be paid to the Department by
the Local Government.
(13) "Monthly Loan Deposit" shall mean the monthly deposit to be made by the Local
Government to the Loan Debt Service Account.
(14) "Operation and Maintenance Expense" shall mean the costs of operating and maintaining
the Stormwater System determined pursuant to generally accepted accounting principles, exclusive of
interest on any debt payable from Gross Revenues, depreciation, and any other items not requiring the
expenditure of cash.
(15) "Pledged Revenues" shall mean the specific revenues pledged as security for repayment of
the Loan and shall be the Gross Revenues derived yearly, after payment of the Operation and
Maintenance Expense and the satisfaction of all yearly payment obligations on account of the Senior
Revenue Obligations and any senior obligations issued pursuant to Section 7.02 of this Agreement.
(16) "Preconstmction Activities" shall mean the planning, administrative, and engineering work
necessary for the Local Government to qualify for Clean Water State Revolving Fund financing for
construction of stormwater management devices and facilities. The Preconstmction Activities are being
financed with Federal funds.
(17) "Project" shall mean the construction of facilities planned and designed through the
Preconstruction Activities.
(18) "Semiannual Loan Payment" shall mean the payment due from the Local Government to the
Department at six-month intervals, and it is comprised of principal, interest, and Grant Allocation
Assessment. In addition, the Loan Service Fee and all of the associated interest are deducted from the
first two payments.
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(19) "Senior Revenue Obligations" shall mean the following debt obligations:
(a) City of Sanford, Florida, Stormwater System Revenue Bonds, Series 1998, issued in the
amount of $4,200,000, pursuant to Resolution No. 98-1801; and
(b) Additional bonds issued on a parity with the bonds identified above pursuant to
Section 3.04(H) of Resolution No. 98-1801; and
(c) Any refunding bonds issued to refund the obligations identified above provided such bonds
shall not increase annual debt service during the repayment period of this Loan.
(20) "Stormwater System" shall mean all devices and facilities owned by the Local Government
for collection, transmission, detention, retention, treatment, and management of stormwater.
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.
ARTICLE 1I - 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 hereofi
(2) The Local Government currently is not the subject of bankruptcy, insolvency, or
reorganization proceedings 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) Them 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 knows of no mason why any future required permits or approvals
associated with the Project are not obtainable.
(5) The Local Government shall undertake Preconstruction Activities and the Project on its own
responsibility, to the extent permitted by law.
(6) To the extent permitted by law, the Local Government 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, engineering, administrative, and construction
activities financed by this Loan or in its operation of Project facilities.
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(7) All Local Government representations to the Department, pursuant to the Loan Application
and Agreement, were true and accurate as of the date such representations were made. The financial
information delivered by the Local Government to the Department was current and correct as of the date
such information was delivered. The Local Government shall comply with Chapter 62-503, Florida
Administrative Code, or succeeding rules, and all applicable State and Federal laws, rules, and
regulations which are identified in the Loan Application or Agreement. 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.
(8) The Local Government shall maintain records using generally accepted accounting
principles established by the Governmental Accounting Standards Board. As part of its bookkeeping
system, the Local Government shall keep accounts of the Stormwater System separate from all other
accounts and it shall keep accurate records of all revenues, expenses, and expenditures relating to the
Stormwater System, and of the Pledged Revenues, Loan disbursement receipts, Loan Debt Service
Account, and Loan Repayment Reserve Account.
(9) In the event the anticipated Pledged Revenues are shown by the Local Government's annual
budget to be insufficient to make the Semiannual Loan Payments 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 Semiannual Loan Payments. 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. The Local Government shall notify the Department immediately in writing of any
such budgeting of other legally available funds. Nothing in this covenant shall be construed as creating a
pledge, lien, or charge upon any such other legally available funds, or requiring the Local Government to
levy or appropriate ad valorem tax revenues, or 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.
(10) Each year, beginning three months before the first Semiannual Loan Payment and ending
with the year during which the final Loan repayment is made, the Local Government's Authorized
Representative or its chief financial officer shall submit, no later than the date established in Section
10.07, a certification that: (a) Pledged Revenue collections satisfy, on a pro rata basis, the rate coverage
requirement; (b) the Loan Debt Service Account contains the funds required; and (c) the Loan
Repayment Reserve Account contains the funds required.
(11) Pursuant to Section 216.347 of the Florida Statutes, the Local Government shall not use the
Loan proceeds for the purpose of lobbying the Florida Legislature, the Judicial Branch, or a State agency.
(12) The Local Government agrees to complete the Preconstrnction Activities and, if included by
an amendment to this Agreement, the Project, in accordance with the Preconstruction Activities schedule
set forth in Section 10.07 and a Project Schedule added by amendment to this Agreement. Delays
incident to strikes, riots, acts of God, and other events beyond the reasonable control of the Local
Government are excepted. However, there shall be no resulting diminution or delay in the Semiannual
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
completing planning, engineering, and administrative activities in order to construct facilities which will,
in all events, serve a public purpose.
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2.02. LEGAL AUTHORIZATION.
Upon signing this Agreement, the Local Government's legal counsel hereby expresses the
opinion, subject to laws affecting the rights of creditors generally, that:
(1) This Agreement has been duly authorized by the Local Government and shall constitute a
valid and legal obligation of the Local Government enforceable in accordance with its terms upon
execution by both parties; and
(2) This Agreement specifies the revenues pledged for repayment of the Loan, and the pledge is
valid and enforceable.
2.03. AUDIT AND MONITORING REQUIREMENTS.
The Local Government agrees to the following audit and monitoring requirements.
(1) The financial assistance authorized pursuant to this Loan Agreement consists of the
following:
Federal Resources, Including State Match, Awarded to the Recipient Pursuant to this Agreement Consist of the
Following:
Federal State
Program Federal CFDA Funding Appropriation
Number Agency Number CFDA Title Amount Category
CS120001-020 EPA 66.458 Capitalization Grants for
State Revolving Funds $790,268 140131
(2) Audits.
(a) In the event that the Local Government expends $300,000 or more in Federal awards in its
fiscal year, the Local Government must have a single or program-specific audit conducted in accordance
with the provisions of OMB Circular A-133, as revised. Subsection 2.03(1) of this Agreement indicates
that Federal funds are awarded through the Department of Environmental Protection by this Agreement.
In determining the Federal awards expended in its fiscal year, the Local Government shall consider all
sources of Federal awards, including Federal resources received from the Department of Environmental
Protection. The determination of amounts of Federal awards expended should be in accordance with the
guidelines established by OMB Circular A-133, as revised. An audit of the Local Government conducted
by the Auditor General in accordance with the provisions of OMB Circular A-133, as revised, will meet
the requirements of this part.
(b) In connection with the audit requirements addressed in the preceding paragraph (a), the
Local Government shall fulfill the requirements relative to auditee responsibilities as provided in
Subpart C of OMB Circular A-133, as revised.
(c) ffthe Local Government expends less than $300,000 in Federal awards in its fiscal year, an
audit conducted in accordance with the provisions of OMB Circular A-133, as revised, is not required. In
the event that the Local Government expends less than $300,000 in Federal awards in its fiscal year and
elects to have an audit conducted in accordance with the provisions of OMB Circular A-133, as revised,
the cost of the audit must be paid from non-Federal resources (i.e., the cost of such an audit must be paid
from Local Government resources obtained from other than Federal entities).
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(d) The Local Government may access information regarding the Catalog of Federal Domestic
Assistance (CFDA) via the internet at httD://as~e.os.dhhs.gov/cfda.
(3) Report Submission.
(a) Copies of reporting packages for audits conducted in accordance with OMB Circular A-133,
as revised, and required by Subsection 2.03(2) of this Agreement shall be submitted, when required by
Section .320 (d), OMB Circular A-133, as revised, by or on behalf of the Local Government directly to
each of the following:
(i)
The Department of Environmental Protection at each of the following addresses:
Don W. Berryhill, P.E., Chief
Bureau of Water Facilities Funding
Florida Department of Environmental Protection
2600 Blair Stone Road, MS 3505
Tallahassee, Florida 32399-2400
Joe Aita, Audit Director
Office of the Inspector General
Florida Department of Environmental Protection
2600 Blair Stone Road, MS 40
Tallahassee, Florida 32399-2400
(ii)
The Federal Audit Clearinghouse designated in OMB Cimular A-133, as revised (the
number of copies required by Sections .320 (d)(1) and (2), OMB Circular A-133, as revised,
should be submitted to the Federal Audit Clearinghouse), at the following address:
Federal Audit Clearinghouse
Bureau of the Census
1201 East l0th Street
Jeffersonville, IN 47132
(iii) Other Federal agencies and pass-through entities in accordance with Sections .320(e) and
(f), OMB Circular A-133, as revised.
(b) Pursuant to Section .320(f), OMB Circular A-133, as revised, the Local Government shall
submit a copy of the reporting package described in Section .320(c), OMB Circular A-133, as revised,
and any management letters issued by the auditor, to the Department of Environmental Protection at the
two addresses listed under Subsection 2.03(3)(a) of this Agreement.
(c) Any reports, management letters, or other information required to be submitted to the
Department of Environmental Protection pursuant to this Agreement shall be submitted timely in
accordance with OMB Circular A-133, Florida Statutes, or Chapters 10.550 (local governmental entities)
or 10.650 (nonprofit and for-profit organizations), Rules of the Auditor General, as applicable.
(d) Local Governments, when submitting financial reporting packages to the Department of
Environmental Protection for audits done in accordance with OMB Circular A-133, or Chapters 10.550
(local governmental entities) or 10.650 (nonprofit and for-profit organizations), Rules of the Auditor
General, should indicate the date that the reporting package was delivered to the Local Government in
correspondence accompanying the reporting package.
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(4) Project-Specific Audit.
Within 12 months after the amendment establishing final Project costs the Local Govemment
shall submit to the Department a Project-specific audit report for the Loan related revenues and
expenditures. The audit shall address Loan disbursements received, Project expenditures, and
compliance with Loan Agreement covenants. The Local Government shall cause the auditor to notify the
Department immediately if anything comes to the auditor's attention during the examination of records
that would constitute a default under the Loan Agreement. The audit findings shall set aside or question
any costs that are unallowable under Chapter 62-503, Florida Administrative Code. A final
determination of whether such costs are allowed shall be made by the Department.
Notwithstanding the preceding paragraph, a Project-specific audit shall not be required if the
only disbursements of Loan proceeds under this Agreement, including amendments thereto, are for the
administrative, planning, and engineering allowances and Loan Repayment Reserve.
(5) Record Retention.
The Local Government shall retain sufficient records demonstrating its compliance with the
terms of this Agreement for a period of five years from the date the audit report is issued, and shall allow
the Department of Environmental Protection, or its designee, Comptroller, or Auditor General access to
such records upon request. The Local Government shall ensure that audit working papers are made
available to the Department of Environmental Protection, or its designee, Comptroller, or Auditor
General upon request for a period of three years from the date the audit report is issued, unless extended
in writing by the Department of Environmental Protection.
(6) Monitoring.
In addition to reviews of audits conducted in accordance with OMB Circular A-133, as revised
(see audit requirements above), monitoring procedures may include, but not be limited to, on-site visits
by Department staff, limited scope audits as defined by OMB Cimular A-133, as revised, and/or other
procedures. By entering into this Agreement, the Local Government agrees to comply and cooperate
with any monitoring procedures/processes deemed appropriate by the Department of Environmental
Protection. In the event the Department of Environmental Protection determines that a limited scope
audit of the Local Government is appropriate, the Local Government agrees to comply with any
additional instructions provided by the Department to the Local Government regarding such audit. The
Local Government further agrees to comply and cooperate with any inspections, reviews, investigations,
or audits deemed necessary by the Comptroller or Auditor General.
ARTICLE I'd - LOAN REPAYMENT ACCOUNTS
3.01. LOAN DEBT SERVICE ACCOUNT.
The Local Government shall establish a Loan Debt Service Account with a Depository and begin
making Monthly Loan Deposits no later than the date set forth in Section 10.07 unless the date is revised
by amendment of this Agreement.
Beginning six months prior to each Semiannual Loan Payment, the Local Government shall make
six Monthly Loan Deposits. The first five deposits each shall be at least equal to one-sixth of the
Semiannual Loan Payment. The sixth Monthly Loan Deposit shall be at least equal to the amount
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required to make the total on deposit in the Loan Debt Service Account equal to the Semiannual Loan
Payment amount, taking into consideration investment earnings credited to the account pursuant to
Section 3.02.
Any month in which the Local Government fails to make a required Monthly Loan Deposit, the
Local Government's chief financial officer shall notify the Department of such failure. In addition, 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 LOAN DEBT SERVICE ACCOUNT MONEYS.
Moneys on deposit in the Loan Debt Service Account shall be invested pursuant to the laws of
the State of Florida. Such moneys may be pooled for investment purposes. The maturity or redemption
date of investments shall be not later than the date upon which such moneys may be needed to make
Semiannual Loan Payments. The investment earnings shall be credited to the Loan Debt Service
Account and applied toward the Monthly Loan Deposit requirements.
3.03. LOAN DEBT SERVICE ACCOUNT WITHDRAWALS.
The withdrawal of moneys from the Loan Debt Service Account shall be for the sole purpose of
making the Semiannual Loan Payment or for discharging the Local Government's obligations pursuant to
Section 8.01.
3.04. LOAN REPAYMENT RESERVE ACCOUNT.
A Loan Repayment Reserve Account shall be established with a Depository. The Local
Government shall deposit into the account the reserve amount identified in Section 10.07 by the date set
forth therein, unless the date or the amount is revised by amendment to this Agreement.
3.05. LOAN REPAYMENT RESERVE WITHDRAWALS.
The Loan Repayment Reserve Account shall be used by the Local Government to cure a
temporary and unexpected deficiency in any Semiannual Loan Payment. The Local Govemment's chief
financial officer shall promptly notify the Department upon any withdrawal from the account. Any
unused portion of the Loan Repayment Reserve Account shall be applied to the final Semiannual Loan
Payment(s) or used for discharging the Local Government's obligations pursuant to Section 8.01.
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 deposits to restore the account. Special restoration deposits shall be made from the first moneys
legally available to the Local Government for such purpose.
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3.07. INVESTMENT OF LOAN REPAYMENT RESERVE MONEYS.
Moneys on deposit in the Loan Repayment Reserve Account shall be invested pursuant to the
laws of the State of Florida. Such moneys may be pooled for investment purposes. The maturity or
redemption date of investments shall be not later than the date set for the final Semiannual Loan Payment
provided, however, that moneys must be available for withdrawal, if necessary, pursuant to Section 3.05.
All investment income and earnings shall be credited to the Loan Repayment Reserve Account.
3.08. ASSETS HELD IN TRUST.
The assets in each of the accounts created under this Loan Agreement shall be held in trust for
the pu~oses provided herein and used only for the purposes and in the manner prescribed in this
Agreement; and, pending such use, said assets shall be subject to a lien and charge in favor of the
Department.
ARTICLE IV - PROGRAM INFORMATION
4.01. PROJECT CHANGES.
After the Department's environmental review has been completed, the Local Government shall
promptly notify the Department, in writing, of any Project change that would require a modification to
the environmental information document.
4.02. TITLE TO PROJECT SITE.
No later than the date established by Section 10.07, the Local Government shall have an interest
in real property sufficient for the construction and location of any facility planned and designed through
Preconstruction Activities free and clear of liens and encumbrances which would impair the usefulness of
such sites for the intended use. Ifa limited site title certification is accepted at that date, the Department
shall establish a date for submittal of a clear site title certification in an amendment or new agreement
which provides financing for construction of affected facilities.
4.03. RESERVED.
4.04. RESERVED.
4.05. PROHIBITION AGAINST ENCUMBRANCES.
The Local Government is prohibited from selling, leasing, or disposing of any part of the
Stormwater System which would materially reduce operational integrity or Gross Revenues so long as
this Agreement, including any amendment thereto, is in effect unless the written consent of the
Department is first secured.
4.06. COMPLETION MONEYS.
The Department covenants that the initial State Revolving Fund loan increment to finance
Construction Related Costs will be made available to the Local Government at no greater than the
combined rate of interest and Grant Allocation Assessment set forth in Section 10.03 provided the Local
Government complies with the schedule in Section 10.07, requests and obtains a ranking of the
Construction Related Costs on the fundable portion of the Department's construction loan priority list,
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and submits a complete Loan Application. If all Preconstruction Activities are not completed by the date
specified in Section 10.07 due to any failing of the Local Government, then the commitment to provide
the initial loan increment for Construction Related Costs at no greater than the combined rate of interest
and Grant Allocation Assessment specified in Section 10.03 shall be terminated.
In addition to the proceeds of this or subsequent Loans, the Local Government covenants that it
has obtained, or will obtain, sufficient moneys from other sources to complete the Preconstruction
Activities. The Local Government also covenants that if additional Loan financing is provided for
Construction Related Costs by amendment of this Agreement, it will obtain, sufficient moneys from other
sources as necessary to complete the Project.
4.07. CLOSE-OUT.
The Department may conduct a final inspection of the Preconstruction Activities records, or if
this Agreement is amended to fund Construction Related Costs, the Department shall conduct a final
inspection of the Project records. Following the inspection, deadlines for submitting additional
disbursement requests, if any, shall be established, along with deadlines for uncompleted Loan
requirements, if any. Deadlines shall be incorporated into the Loan Agreement by amendment. After
the Department establishes the final allowances and costs to be financed by the Loan, the itemized
amounts may be adjusted by amendment. The Loan principal shall be reduced by any excess over the
amount required to pay all approved allowances and costs. As a result of such adjustment, the
Semiannual Loan Payment shall be reduced accordingly, as addressed in Section 10.05.
4.08. LOAN DISBURSEMENTS.
Disbursements shall be made only by the State Comptroller and only when the requests for such
disbursements are accompanied by a Department certification that such withdrawals are proper
expenditures. Disbursements shall be made directly to the Local Government for planning, engineering,
and administration allowances and for establishing the Loan Repayment Reserve Account.
Requests by the Local Government for disbursements of the preconstruction funds shall be made
using the Department's disbursement request form but shall not require documentation of actual costs
incurred. One-half of the administrative and planning allowances shall be disbursed on request of the
Local Government after the Loan Agreement is executed. The remaining one-half of the administrative
and planning allowances and the initial one-half of the engineering allowance shall be disbursed on
request of the Local Government after the Department has accepted the planning documents. The
remaining one-half of the engineering allowance shall be disbursed on request of the Local Government
after the completed design documents have been accepted by the Department. Disbursements for
Construction Related Costs shall occur only as a result of an amendment to this Agreement. The
following allowance amounts will be disbursed after the specified milestone events unless the allowances
are reduced pursuant to Section 10.06:
Milestone Event Amount
Loan Agreement executed
Department acceptance of planning documents
Department acceptance of design documents
Total
135,625
383,625
248,000
$ 767,250
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ARTICLE V - RATES AND USE OF THE STORMWATER SYSTEM
5.01. RATE COVERAGE.
The Local Government shall maintain fees, rates, and charges for the services furnished by the
Stormwater System which will be sufficient to provide, in each Fiscal Year, Pledged Revenues equal to
or exceeding 1.15 times the sum of the Semiannual Loan Payments due in such Fiscal Year. In addition,
the Local Government shall satisfy the coverage requirements of all senior and parity debt obligations.
5.02. MAINTENANCE OF THE STORMWATER SYSTEM.
The Local Government shall operate and maintain the Stormwater System in a proper, sound and
economical manner and shall make all necessary repairs, renewals and replacements.
5.03. ADDITIONS AND MODIFICATIONS.
The Local Government may make any additions, modifications or improvements to the
Stormwater System which it deems desirable and which does not materially reduce the operational
integrity of any part of the Stormwater System. All such renewals, replacements, additions,
modifications and improvements shall become part of the Stormwater System.
5.04. 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 Stormwater System for the
amount of all delinquent rates, fees and other charges where such action is permitted by law. The Local
Government shall use its best efforts to shut off water service furnished to persons who are delinquent
beyond customary grace periods in the payment of Stormwater System 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 Loan Repayment Reserve Account or to make any Monthly Loan
Deposit or to make any installment of the Semiannual Loan Payment when it is due and such failure shall
continue for a period of 30 days.
(2) Except as provided in Subsections 6.01(1) and (7), failure to comply with the provisions of
this Agreement or failure in the performance or observance of any of the covenants or actions required by
this Agreement and such failure shall continue for a period of 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.
(4) An order or decree entered, with the acquiescence of the Local Government, appointing a
receiver of any part of the Stormwater System or Gross Revenues thereof; or if such order or decree,
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having been entered without the consent or acquiescence of the Local Government, shall not be vacated
or discharged or stayed on appeal within 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 Gross Revenues of the Stormwater 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 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 30 days.
6.02. REMEDIES.
Upon an event of default and subject to the rights of others having prior liens on the Pledged
Revenues, the Departn~nt may enfome its fights 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 Stormwater System, 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 Stormwater System 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 fights of the Department.
(4) By applying to a court of competent jufisdiction, cause to appoint a receiver to manage the
Stormwater System, establish and collect fees and charges, and apply the revenues to the reduction of the
obligations under this Agreement.
(5) By certifying to the Auditor General and the Comptroller delinquency on loan repayments,
the Department may intercept the delinquent amount plus a penalty 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. The Department may impose a penalty in an amount not to
exceed an interest rate of 18 percent per annum on the amount due in addition to charging the cost to
handle and process the debt. Penalty interest shall accrue on any amount due and payable beginning on
the 30th day following the date upon which payment is due.
(6) By notifying financial market credit rating agencies and potential creditors.
(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.
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(8) By accelerating the repayment schedule or increasing the interest rate on the unpaid
principal of the Loan to as much as 3.333 times the Loan interest rate for a default under Subsection
6.01(1).
6.03. DELAY AND WAIVER.
No delay or omission by the Department to exercise any right or power accruing upon an event
of default shall impair any such right or power or shall be construed to be a waiver of any such default or
acquiescence 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 VH - THE PLEDGED REVENLrES
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 prior and superior to any other lien, pledge or assignment with the following
exception. All obligations of the Local Government under this Agreement shall be junior, inferior, and
subordinate in all respects in right of payment and security to the Senior Revenue Obligations defined in
Section 1.01 of this Agreement and to any additional senior obligations issued with the Department's
consent pursuant to Section 7.02. Any of the Pledged Revenues may be released from the lien in favor of
the Department on such Pledged Revenues 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 debt service 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 provided the Department's written consent is obtained.
Such consent shall be granted if the Local Government demonstrates at the time of such issuance that the
Pledged Revenues, which may take into account reasonable projections of growth of the Stormwater
System and revenue increases, plus revenues to be pledged to the additional proposed debt obligations
will, during the period of time Semiannual Loan Payments are to be made under this Agreement, equal or
exceed 1.15 times the annual combined debt service requirements of this Agreement and the obligations
proposed to be issued by the Local Government and will satisfy the coverage requirements of all other
debt obligations secured by the Pledged Revenues. However, no such consent is required with respect to
issuance of Senior Revenue Obligations as defined in Section 1.01.
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
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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 entire principal amount of the Loan, Loan Service
Fee, related interest, and Grant Allocation Assessment, the pledge of, and lien on, the Pledged 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. RECORDS AND STATEMENTS.
Books, records, reports, engineering documents, contract documents, and papers shall be
available to the 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 until five years after the date that the Project-specific audit report, required
under Subsection 2.03(4), is issued
8.03. ACCESS TO WORK SITE.
The Local Government shall provide access to offices and other sites where Preconstruction
Activities or Project work (if financed by this Loan) is ongoing, or has been performed, to authorized
representatives of the Department at any reasonable time. The Local Government shall cause its
engineers and contractors to provide copies of relevant records and statements for inspection.
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
written 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 written agreements between the
Department and the U.S. Environmental Protection Agency. A final amendment establishing the final
allowances and costs financed by this Loan shall be completed after the Department's final inspection of
relevant documents.
8.06. ANNULMENT OF AGREEMENT.
The Department may unilaterally annul this Agreement if the Local Government has not drawn
any of the Loan proceeds within eighteen months after the effective date of this Agreement. If the
Department unilaterally annuls this Agreement, the Department will provide written notification to the
Local Government.
8.07. SEVERABILITY CLAUSE.
ff 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.
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ARTICLE IX - RESERVED
ARTICLE X - DETAILS OF FINANCING
10.01. PRINCIPAL AMOUNT OF LOAN.
The principal amount of the Loan is $828,568, which includes $790,268 to be disbursed to the
Local Govemment and $38,300 of Capitalized Interest.
Capitalized Interest is not disbursed to the Local Government, but is amortized via periodic Loan
repayments to the Department as if it were actually disbursed. Capitalized Interest is computed at the
combined rate of interest and Grant Allocation Assessment, or rates, set for the Loan. It accrues and is
compounded annually from the time when disbursements are made until six months before the first
Semiannual Loan Payment is due. Capitalized Interest is estimated prior to establishment of the schedule
of actual disbursements.
10.02. LOAN SERVICE FEE.
The Loan Service Fee is $15,345 for the Loan amount authorized to date. The fee represents two
percent of the Loan amount excluding the Loan Repayment Reserve and Capitalized Interest amounts;
that is, two percent of $767,250. An additional Loan Service Fee amount will be assessed for any
additional funding provided by amendment to the Agreement. The fee shall be adjusted downward if
adjustment of Project costs results in a Loan decrease, provided that the decrease amendment is executed
before the first Semiannual Loan Payment due date.
Interest shall accrue on the Loan Service Fee at the combined rate of interest and Grant
Allocation Assessment, or rates, set for the Loan until the fee is paid. Loan Service Fee interest shall be
compounded annually from the effective date of the Loan until six months before the first Semiannual
Loan Payment is due at which time it is capitalized. The estimated Loan Service Fee capitalized interest
is $1,540.
10.03. INTEREST AND GRANT ALLOCATION ASSESSMENT RATES.
The combined rate of interest and Grant Allocation Assessment on the unpaid principal of the
Loan amount specified in Section 10.01 is 2.9 percent per annum. Individually, the interest rate is
1.45 percent per annum and the Grant Allocation Assessment rate is 1.45 percent per annum. However,
if this Agreement is not executed by the Local Government and returned to the Department before July 1,
2003 the interest and Grant Allocation Assessment rates may be adjusted. New interest and Grant
Allocation Assessment rates may be established for any funds provided by amendment to this
Agreement.
10.04. LOAN TERM.
The Loan shall be repaid in 40 Semiannual Loan Payments.
10.05. REPAYMENT SCHEDULE.
The Semiannual Loan Payment shall be computed based upon the principal amount of the Loan
plus the Loan Service Fee and Loan Service Fee capitalized interest and the principle of level debt
service. The Department will deduct the Loan Service Fee and all associated interest from the first two
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payments. The Loan principal and Semiannual Loan Payment amounts may be revised by amendment of
the Agreement. After the final disbursement of Loan proceeds, the Loan principal will be adjusted to
reflect the actual dates and amounts of disbursements. Accordingly, the Semiannual Loan Payment
amount shall be adjusted, taking into consideration any previous payments.
Until the principal amount of the Loan is amended, the Semiannual Loan Payment shall be in the
amount of $28,004. The interest and Grant Allocation Assessment portions of each Semiannual Loan
Payment shall be computed on the unpaid balance of the principal amount of the Loan, which principal
amount includes Capitalized Interest. Interest (at the combined rate of Loan interest and Grant
Allocation Assessment) shall also be computed on the unpaid balance of the Loan Service Fee and Loan
Service Fee capitalized interest. The interest and Grant Allocation Assessment on the unpaid balance
shall be computed as of the due date of each Semiannual Loan Payment.
Unless repayment is deferred by an amendment to this Agreement, Semiannual Loan Payments
shall be received by the Department beginning on March 15, 2007, and semiannually thereafter on
September 15 and March 15 of each year until all amounts due have been fully paid. Funds transfer shall
be made by electronic means.
The Semiannual Loan Payment amount is based on the total amount owed of $845,453, which
consists of the Loan principal plus the Loan Service Fee with its capitalized interest.
10.06. PROJECT RELATED COSTS.
The Local Government and the Department acknowledge that actual Project costs or
Preconstruction Activities allowances have not been determined as of the effective date of this
Agreement. An adjustment to Preconstmction Activities allowances may be made due to a reduction in
the scope of work proposed for construction as a result of the planning process. Failure to achieve
Department acceptance of plans and specifications prior to the date specified in Section 10.07 may cause
adjustment of the Preconstruction Activities Allowances. Capitalized Interest will be recalculated based
on actual dates and amounts of Loan disbursements. The final allowance amounts, and Project costs if
financed by this Loan, shall be established in the final amendment. Changes in Preconstruction
Activities allowances or Project costs may also occur as a result of the Local Government's audit or the
Department's audit.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
16
The Local Government agrees to the following estimates of Preconstruction Activities
allowances and related costs:
Administrative Allowance
Planning Allowance
Engineering Allowance
Subtotal
Loan Repayment Reserve
Subtotal (Disbursable Amount)
Capitalized Interest
TOTAL (Loan Principal Amount)
$ 46,500
$ 224,750
$ 496,000
$ 767,250
$ 23,018
$ 790,268
$ 38,300
$ 828,568
The listed allowances are based on estimated Construction Related Costs of $7,750,000, which
excludes the Loan Repayment Reserve and Capitalized Interest amounts.
The Loan Repayment Reserve represents three percent of the Loan amount excluding the
Capitalized Interest and Loan Repayment Reserve amounts; three percent of $767,250 equals $23,018 for
the Loan amount authorized to date.
10.07. SCHEDULE.
All Preconstruction Activities shall be completed no later than the date set forth below to
preserve the Department's commitment to provide the initial State Revolving Fund loan increment for
Construction Related Costs at no greater than the combined rate of interest and Grant Allocation
Assessment specified in Section 10.03. Preconstruction Activities shall be completed in time to enable
the Department to take the actions scheduled in Subsections (1) and (4) below.
(1) Acceptance of the planning documents by the Department (Design Authorization) no later
than May 15, 2004.
(2) Design of all Project facilities proposed for loan funding no later than May 15, 2005.
(3) Certification of availability of all sites for facilities proposed for loan funding no later than
May 15, 2005.
(4) Evidence that permitting requirements have been satisfied for all Project facilities proposed
for construction loan funding no later than February 15, 2006.
(5) Completion of all Preconstruction Activities for all Project facilities proposed for loan
funding no later than March 15, 2006.
(6) Unless deferred by amendment, establish the Loan Repayment Reserve Account and deposit
$23,018 no later than September 15, 2006.
(7) Unless deferred by amendment, establish the Loan Debt Service Account and begin
Monthly Loan Deposits no later than September 15, 2006.
(8) Unless deferred by amendment, provide certifications under Subsection 2.01 (10) beginning
December 15, 2006, and annually thereafter no later than September 30 of each year until the final
Semiannual Loan Payment is made.
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(9) Unless this Agreement is amended to provide construction financing, the first Semiannual
Loan Payment in the amount of $28,004 shall be due March 15, 2007.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
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ARTICLE XI - EXECUTION OF AGREEMENT
This Loan Agreement SWG12058624P 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.
IN WITNESS WHEREOF, 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 Authorized Representative and by its affixed seal. The effective date of this
Agreement shall be as set forth below by the Secretary of the Department.
for
Attest
Cit~ Cl~rk
SEAL
I attest to the opinion expressed in Section 2.02,
entitled Legal Authorization, and as to form and
legal sufficiency./~
City Attorney
for
STATE OF FLORIDA
DEPARTMENT OF ENVIRONMENTAL PROTECTION
JUN 1 9
Secretary Date
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