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HomeMy WebLinkAboutResolution 4862-11-2017 A Resolution NO. 4862-11-2017 STATEMENT EXPRESSING OFFICIAL INTENT TO REIMBURSE EXPENDITURES WITH PROCEEDS OF FUTURE DEBT MARINE CREEK INTERCEPTOR IMPROVEMENTS PHASE 1 PROJECT WHEREAS, the City of Fort Worth, Texas (the "City") is a home- rule municipality and political subdivision of the State of Texas; and WHEREAS, the City expects to pay expenditures in connection with the design, planning, acquisition and construction for the Marine Creek Interceptor Improvements Phase 1 Project (the "Project") prior to the issuance of obligations by the City in connection with the financing of the Project from available funds; and WHEREAS, the City finds, considers, and declares that the reimbursement of the City for the payment of such expenditures will be appropriate and consistent with the lawful objectives of the City and, as such, chooses to declare its intention, in accordance with the provisions of Section 1.150-2 of the Treasury Regulations, to reimburse itself for such payments at such time as it issues obligations to finance the Project; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS: Section 1. The City reasonably expects debt, as one or more series of obligations, may be issued or incurred by the City with an aggregate maximum principal amount not to exceed $2,250,000.00 for the purpose of paying the aggregate costs of the Project. Section 2. All costs to be reimbursed pursuant hereto will be capital expenditures. No obligations will be issued by the City in furtherance of this Statement after a date which is later than 18 months after the later of (1) the date the expenditures are paid or (2) the date on which the property, with respect to which such expenditures were made, is placed in service. ORT WO T Resolution No. 4862-11-2017 Section 3. The foregoing notwithstanding, no obligation will be issued pursuant to this Statement more than three years after the date any expenditure which is to be reimbursed is paid. Adopted this 7th day of November, 2017. 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Adopt the attached resolution expressing official intent to reimburse expenditures with proceeds of future debt for the Marine Creek Interceptor Improvements Project; 2. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Water and Sewer DPN Fund in the amount of$1,979,423.00; and 3. Authorize execution of a contract with PM Construction & Rehab, L.P., in the amount of$1,681,223.00 for Marine Creek Interceptor Improvements Phase I, Part 2 (City Project No. 02223). DISCUSSION: This project provides for trenchless pipe enlargement to upgrade and replace an existing deteriorated sanitary sewer main located within the Marine Creek Sanitary Sewer Basin beginning from the Robertson Road/Boat Club Road intersection generally in a southeasterly direction 5,800 feet to the Bowman- Roberts Road/Cromwell Marine Creek Road intersection. This project was advertised for bids on July 13, 2017 and July 20, 2017 in the Fort Worth Star-Telegram. On August 10, 2017 the following bids were received: Bidder Amount Time of � Completion PM Construction & Rehab, L.P. [$1,681,223.00 P 20 Calendar Days William J Schultz, Inc. d/b/a Circle " C" Construction Company, Inc. $1,754,300.00 Logname: 60MCM365VARPHIP2-PMC0NST Page 1 of 3 ARK Construction Company, Inc. $2,849,130.00 In addition to the contract cost, $214,100.00 is required for project management, material testing and inspection and $84,100.00 is provided for project contingency. This project is anticipated to be included in a future revenue bond issue for the Water and Sewer Fund. Available cash within the Water and Sewer portfolio and the City's portfolio along with the appropriation authority authorized under the Direct Purchase Note (DPN) Program will be used to provide interim financing for this project until debt is issued. To the extent resources other than the Water and Sewer portfolio are used to provide interim financing, the Water and Sewer Fund will be charged interest that is equivalent to the overall rate of return being earned by the City portfolio (currently approximately one- percent annually). Should the City's portfolio not support the liquidity needed to provide an interim short- term financing source, another funding source will be required, which could mean issuance of securities under the DPN Program or earlier issuance of Water and Sewer revenue bonds than is currently planned. Once debt associated with this project is sold, bond proceeds will be used to reimburse the Water and Sewer portfolio and the City's portfolio in accordance with the attached Reimbursement Resolution. The City Council adopted the Water Department's Fiscal Year 2017-2021 Five Year Capital Improvement Plan on January 24, 2017, Mayor and Council Communication (M&C G-18927). This City Council adopted plan includes this specific project, with funding identified through the DPN program to be reimbursed with future revenue bonds. In accordance with the provisions of the Financial Management Policy Statement, Staff anticipates presenting revenue-supported debt issuances to the City Council for consideration within the next three years. This debt must be issued within approximately three years to provide reimbursement for these expenses. If that does not occur, the costs will no longer be reimbursable by issuing tax-exempt debt and the funding source will have to be made whole through budgetary methods. Adoption of this resolution does not obligate the City to sell bonds, but preserves the ability to reimburse the City from tax- exempt bond proceeds. Construction is anticipated to commence in January 2018 and be completed by December 2018. The overall project budget is estimated to be $4,974,000.00. This project is part of the Water Department's Sanitary Sewer Overflow Initiative Program. This project will have no impact on the Water Department's Operating Budget when complete. M/WBE OFFICE— PM Construction & Rehab, L.P., is in compliance with City's BDE Ordinance by committing to six percent MBE participation. The City's MBE goal on this project is six percent. The project is located in COUNCIL DISTRICT 2. FISCAL INFORMATION / CERTIFICATION: The Director of Finance certifies that upon approval of the above recommendations and adoption of the attached appropriation ordinance, funds will be available in the Water and Sewer DPN Fund for this project. The Water and Sewer DPN Fund includes authority of$100,000,000.00 for the purpose of providing interim funding for Water and Sewer Capital Projects. After this transfer, the balance will be $87,720,529.00: FUND Existing Additional Project Appropriations I Appropriations Total* 2017AWater and Sewer Bond Fund $1,922,700.00 $0.00 $1,922,700.00 56011 [Water and Sewer Logname: 60MCM365VARPHIP2-PMCONST Page 2 of 3 IDPN Fund 56014 $0.001 $1,979,423.001$1,979,423.00 Sewer Capital -- Fund - Legacy $1,070,956.00 . $0.00 $1,070,956.00 59607 Project Total $2,993,656.00 $1,979_ ,423.00 $4,973,079.00 * Numbers rounded for presentation purposes FUND IDENTIFIERS (FIDs): TO Fund Department cc, un Project Program ctivity Budget Reference # moun ID ID Year Chartfield 2 FROM Fund Department ccoun Project Program ctivity Budget Reference # moun ID ID Year Chartfield 2 CERTIFICATIONS: Submitted for City Manager's Office by: Jay Chapa (5804) Originating Department Head: Kara Shuror (8819) Additional Information Contact: Roberto C. Sauceda (2387) Logname: 60MCM365VARPHIP2-PMCONST Page 3 of 3