Title
Authorizing the City Manager to enter into an agreement with DCS Engineering, LLC not to exceed $25,000 for the preparation of the City's application to the Texas Water Development Board (TWDB) for the State Fiscal Year (SFY) 2011 Clean Water State Revolving Fund. This action will continue the application process for a loan to construct a segment of the Phase I Wastewater Interceptor between SH 130 and Weiss Lane.
Summary
On November 23, 2010 the City Council authorized the City Manager to continue with Pflugerville's intent to apply for Mainstream funds from the SFY 2011 Clean Water State Revolving Fund (CWSRF). A copy of the Invitation Response Form is attached. In order to be considered for these funds, a comprehensive application should be prepared by a consultant, with staff’s assistance, who is familiar with the City of Pflugerville’s utility system. This application deadline is February 7, 2011, which is the purpose of the request at this time. After meeting with a consultant last week, staff recommends deferring the onset of the construction of the Wilbarger Regional Wastewater Treatment Plant until 2014 due to slower than anticipated growth in new wastewater connections. The plant would be operational in 2016. A complete presentation of the implementation of the wastewater improvements in the City's ETJ, along with a review of the related Preliminary Engineering Report is planned for the January 11, 2011, City Council meeting.
In the meantime, staff convened to discuss short and medium term growth and development patterns. Through this discussion, significant infrastructure voids were identified in the vicinity of targeted growth areas such as SH 130 and Pflugerville Parkway. Elements of the Wastewater Master Plan have been constructed, such as the wastewater interceptor that serves the northwest corner of FM 685 and Pflugerville Parkway, but others have not. The long-term, cost-effective development of wastewater infrastructure to serve the E. Pflugerville Parkway corridor between 130 and Weiss Lane is key to the overall plan for interceptor implementation. It is this line which the staff recommends using the currently available SFY 2011 CWSRF loan to construct. The estimated cost of this portion of the wastewater interceptor is $4 million. Development of this infrastructure emphasizes the desirability and timing of development west of Weiss Lane, maximizing existing investments. Reference the note on the Invitation Response Form.
Further, staff recommends that the City continue to express interest in pursuing the low-interest loans through theTWDB to construct further elements of the wastewater master plan when needed.
Prior City Council Action
On November 23, 2010, Council authorized continued participation in the SFY 2011 Revolving Loan Fund.
Deadline for City Council Action
The application deadline for receipt of the current year TWDB funds is February 7, 2011. Approving the staff recommendation at this meeting will allow the consultant and staff adequate time to prepare a complete application.
Projected Future City Council Action
A summary of the Preliminary Engineering Report will be presented on January 11, 2011.
Fiscal Impact
The proposal from DCS Engineering to prepare the application is for an amount not to exceed $25,000 and will come from Utility Fund Balance. The application approval process will also include environmental assessment costs of $7,500 which will also be paid through Utility Fund Balance. These funds were appropriated during the Utility Capital Improvement Project discussions during the FY 2011 budget preparation.
Following application approval, additional costs to construct the project will total approximately $62,500 of which $37,500 is for additional environmental studies that are only required due to the federal nature of the funds and resulting additional information that must be provided to qualify for the funds. The Finance staff analyzed the addtional cost in relation to the savings that would be realized through the lower interest rate savings over the term of the $4 million TWDB bonds. The savings are estimated based upon an interest rate that is 1.3% less than interest rates associated with direct City bonding. Over a thirty-year term, the savings that would be seen from utilizing TWDB funding would exceed $1,000,000.
Staff Recommendation
Staff recommends approval.
Drafter
Trey Fletcher, Managing Director of Operations