PROPOSED WATER REVENUE BOND FINANCING
WATER INFRASTRUCTURE IMPROVEMENT PROGRAM
PHASE 2: CLEARWELL REPLACEMENT PROJECT
CITY COUNCIL MEETING
AUGUST 15, 2023
• As discussed at numerous City Council meetings
*Mar. 18, 2020 *Jun. 16, 2020 *Oct. 20, 2020 *Nov. 17, 2020 *Mar. 16, 2021 *Apr. 20, 2021 *Jun. 01, 2021 *Jul. 20, 2021 *Aug. 17, 2021 *Sept. 07, 2021 *Apr. 05, 2022 *Oct. 18, 2022 *Feb. 07, 2023 *May 16, 2023 • Three phases of projects
• Phase 1 Clearwell Bypass (completed)
• Phase 2 Clearwell Replacement (construction contract award on Sept. 19) • Phase 3 SDCWA Treated Water Connection projects
• Funding provided by the four-year water utility rate plan adopted November 2021 for calendar years 2022 through 2025
Water Infrastructure Improvement Program
Provide safe and reliable water service to Poway residents today and for generations to come
Improve reliability and resiliency of Poway’s water supply Diversify the City’s water supply portfolio
Improve redundancy and operational flexibility
Satisfy requirements of the mutual agreement with the State Water Resources Control Board, Division of Drinking Water (DDW) Water Infrastructure Improvement Program Goals
Clearwell
Replacement Project
Treated Water
Facilities Projects
Water Infrastructure Improvement Program Components
Clearwell
Bypass Project
Clearwell Bypass Project
• Enables the replacement of the existing
10-million-gallon water storage reservoir
• Two 1.4 million-gallon bolted steel tanks
are required for water storage
• A pump station is required to pump water
to the tanks
• 24 inch above-ground piping and
pressure regulating station is required to
move water to and from the tanks
• 36 inch below-ground pipeline is
required to move water into the
distribution system
• Construction: Sept. 2021-Sept. 2022
• Construction Contact: $7.3M
• Final Contract Amount: $7.6M
• Project Savings: $1M
Clearwell
Replacement Project
Treated Water
Facilities Projects
Water Infrastructure Improvement Program
Clearwell
Bypass Project
Clearwell Replacement Project
• Replace the existing Clearwell floating cover structure with two 4 million-gallon prestressed concrete tanks
• Replace the original inlet and outlet valves and piping • Removal of the temporary bypass facilities and
restoration of the softball field
• Engineer’s Construction Estimate: $30M-$35M
• Apparent Low Bidder: Gateway Pacific Contractors;
$31,646,023
Status:
• Advertisement for bids: 5/11/2023
• Bid opening: 6/15/2023
• Award of contract: 9/19/2023
• Construction Start: Fall 2023
• Completion and commissioning of Clearwell tanks: Early Spring 2026
• Construction completion and restoration of softball field:
Fall 2026
Clearwell
Replacement Project
Treated Water
Facilities Projects
Water Infrastructure Improvement Program
Clearwell
Bypass Project
• Issued in November 2021
• $12.9 million par value
• $14.9 million in net project fund proceeds
• Clearwell Bypass project design & construction
• Clearwell Replacement project planning & design
• Treated Water Facilities projects planning & design
• Issued by the Poway Public Financing Authority
• 30-year term (final maturity June 2051)
• Level annual debt service structure
• S&P bond rating: AA (insured) AA- (underlying)
• Average annual debt service: $753,700
• True interest cost 2.7634%
Series 2021A Water Revenue Bonds
• Not to exceed $38.0 million par value
• $38.1 million in net project fund proceeds
• Clearwell Replacement project construction
• Treated Water Facilities projects final design costs
• Issued by the Poway Public Financing Authority
• 30-year term (final maturity June 2053)
• Level annual debt service structure
• S&P bond rating: AA- (underlying)
• Average annual debt service: $2.32 million (est.)
• True interest cost 4.378% (est.)
Proposed Series 2023A Water Revenue Bonds
• City Staff/City Attorney
• Bond Counsel/Disclosure Counsel (Stradling Yocca Carlson & Rauth) • Brian Forbath, Esq. (present this evening)
• Cyrus Torabi, Esq.
• Financial Advisor (Fieldman, Rolapp & Associates, Inc.) • Jim Fabian, Principal
• Un Chu Reardon, Senior Vice President (present this evening) • Underwriter (Stifel, Nicolaus & Company, Incorporated) • Sara Brown, Managing Director (present this evening)
• Program Management (Kennedy Jenks)
• Andrew Webster, Senior Water Resources Manager
Key Financing Team Participants
• Resolutions
• City and Poway Public Financing Authority (“PFA”)
• Indenture of trust
• PFA and U.S. Bank N.A., as trustee
• Installment purchase agreement
• PFA and City
• Bond purchase agreement
• PFA, City and Stifel, Nicolas and Company, Incorporated (underwriter) • Preliminary official statement
• Bond offering document to potential investors
• Continuing disclosure agreement
Series 2023A Water Revenue Bonds
Documents for August 15
th
City Council Meeting
Timeline
City Council Meeting to
Authorize Financing
August 15
Bond Pricing
+/- August 24
Clearwell Replacement
Project Contract Award
September 19
Bond T ransaction
Closing
By 2nd week of
September
• City Council – Adopt the Resolution approving the execution and delivery of an installment purchase agreement for the purpose of causing the issuance of not-to-exceed $38,000,000 aggregate principal amount of Water Revenue Bonds, Series 2023A and approving the execution and delivery of certain documents in connection therewith and certain other related matters
• Poway Public Financing Authority Board of Directors – Adopt the Resolution approving the sale of its Water Revenue Bonds, Series 2023A, in an aggregate principal amount not to exceed
$38,000,000 and approving the execution and delivery of certain documents in connection therewith and certain other matters Recommended Actions
PUBLIC COMMENT
and
CITY COUNCIL DISCUSSION
15