CITY OF FAIRFIELD
RESOLUTION NO. 2024-279
MAKING FINDINGS REQUIRED UNDER GOVERNMENT CODE SECTION 4217.10 TO 4217.18,
AUTHORIZING THE CITY MANAGER TO ENTER INTO AN ENERGY SAVINGS PERFORMANCE
CONTRACT WITH WILLDAN ENERGY SOLUTIONS FOR EFFICIENCY AND INFRASTRUCTURE IMPROVEMENTS PROJECTS; AUTHORIZING STAFF TO NEGOTIATE A FINANCING PLAN NOT TO EXCEED $23,000,000; UPDATING THE 5-YEAR CAPITAL IMPROVEMENT PLAN TO INCLUDE THE ENERGY CONSERVATION PROJECT – PHASE 1; AND AUTHORIZING AN UPDATE TO THE FISCAL YEAR 2024-2025 BUDGET
WHEREAS, the City of Fairfield selected Willdan Energy Solutions (W ES) through a competitive Request for Qualifications process to support the City with energy conservation design -build services; and
WHEREAS, WES has completed the Investment Grade Audit (IGA) , which includes an in -depth analysis of the financial aspects of energy savings and return on investment from changes or upgrades to City facilities that are in alignment with addressing core infrastructure needs, deferred maintenance, and efficiency improvements; and
WHEREAS, the scopes of work identified as the Energy Conservation Project – Phase 1 (Project) are a result of recommendations from the IGA, which prio ritize measures that include time- restricted incentives for equipment and upgrades based on systems in various states of failure and end of life; and
WHEREAS, California Government Code Section 4217.10 to 4217.18, authorizes the City to enter into an Energy Savings Performance Contract for the implementation of energy -related improvements if the City Council finds that it is in the best interest of the City to enter into such agreement and that the anticipated cost to the City for thermal or electrical energy or conservation se rvices provided by WES under the contr act will be less than the anticipated marginal cost to the City of thermal, electrical, or other energy that would have been consumed by the City in the absence of those purchases; and
WHEREAS, WES has already been chosen to perform future phases of the energy conservation projects associated with the IGA; and
WHEREAS, the anticipated cost to the City for thermal or electrical energy or conservation services provided under the proposed Energy S avings Performance Contract will be less than the anticipated marginal cost to the City of thermal, electrical, or other energy that would have been consumed by the City in the absence of the implementation of the improvements under the Energy Savings Performance Contract; and
RES. NO. 2024-279
WHEREAS, the difference, if any, between the fair rental value for the real property subject to the facility ground lease and the agreed rent is anticipated to be offset by below -market energy purchases or other benefits provided under the energy service contract; and
WHEREAS, the total cost of the Project is $31,579,787, and if all measures are constructed, the anticipated lifetime (30-year) incentives and savings are estimated at $47.9 million with a net lifetime Project savings of $4.3 million to $17.9 million; and
WHEREAS, staff has identified approximately $ 8.7 million in capital outlay within the fiscal year (FY) 2024-2025 Budget; and
WHEREAS, funding was not allocated for this Project in the City’s approved FY 2024-2025 Budget, thus requiring a budget adjustment of $8,688,308; and
WHEREAS, the revised appropriation constitutes an update to the FY 2024-2025 Budget approved pursuant to Resolution No. 2023-149; and
WHEREAS, staff anticipates financing the remaining $22,891,479; and
WHEREAS, the annual impact to the general fund for the repayment on a financing plan could range from a net cost of $300,000 to $500,000 per year for the first 5-8 years; and
WHEREAS, an alternative financing plan could result in an annual cash positive to the general fund of $200,000 to $300,000 for the life of the loan; however, would add an additional estimated cost of $1,000,000 to $2,000,000.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:
Section 1. The council finds that it is in the best interest of the City to enter into the Energy Savings Performance Contract , a Facility Financing Contract, and a ny necessary Facility Ground Lease, and that the terms set forth in this resolution are in the best interest of the City.
Section 2. The City finds that t he anticipated cost to the City for the thermal or electrical energy or conservation services prov ided under said contract will be less than the anticipated marginal cost to the City of thermal , electrical, or other energy work that would have been consumed by the City in the absence of the implementation of the improvements under the Energy Savings Performance Contract, and , therefore, this City hereby declares its intention to enter into the Energy Savings Performance Con tract with WES for energy conservation services for the City facilities defined within.
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Section 3. The City further finds that t he difference, if any, between the fair rental value for any real property subject to a facility ground lease and the agreed rent is anticipated to be offset by below-market energy purchases or other benefits provided under the energy service contract.
Section 4. The City further finds that funds for the repayment of the financing or the cost of design, construction, and operation of the energy conservation facility, or both, as required by the contract are projected to be available from revenues resultin g from sales of electricity or thermal energy from the facility or from funding that otherwise would have been used for purchase of electrical, thermal, or other energy required by the public agency in the absence of the energy conservation facility, or both.
Section 5. The council hereby approves an increase in appropriations of $31,579,787 to Public Buildings Capital Fund (Fund 254; CPW010107) to be funded by the following: $2,519,000 Bedroom Tax (Fund 165), $2,401, 308 AB 1600 Government Facilities (Fund 262), $2,140,000 Construction License Tax (Fund 164), $1,318,000 Civic Center Improvement Fund (Fund 532), and $310,000 Transit (Fund 451 and Fund 452). The remaining balance will be funded via a financing plan.
Section 6. The city manager or designees are authorized to negotiate a Financing Plan with an amount not-to-exceed $23,000,000 and provide such information and assurances required for loan application(s).
Section 7. The city manager is authorized to update the 5 -Year Capital Improvement Plan to include the Energy Conservation Project – Phase 1.
Section 8. The city manager or designee is hereby authorized to do all things necessary to implement this resolution.
RES. NO. 2024-279
PASSED AND ADOPTED this 3rd day of December 2024, by the following vote:
AYES: COUNCILMEMBERS: MOY / BERTANI / CARR / PANDURO /TONNESEN / VACCARO / WILLIAMS
NOES: COUNCILMEMBERS:
ABSENT: COUNCILMEMBERS:
ABSTAIN: COUNCILMEMBERS:
MAYOR
ATTEST:
CITY CLERK