City Council and Authorities Concurrent
July 7, 2026

1 City Council Meeting
Item 4: RTC 26-352
Adoption of Resolution Approving the
Execution, Delivery and Performance of a
Revolving Credit Agreement with TD Public
Finance, LLC for Capital Costs for the Electric
System in the Amount Not-to-Exceed
$350,000,000 and Authorizing the Execution,
Delivery and Performance of Related
Documents and Certain Other Actions in
connection with this Financing
July 7, 2026
• Background
• Financing Plan
• Fiscal Impact
• Recommendation
Agenda
2 1
2 Item 4
2 •City Staff: Linh Lam, Jensen Barna, Randy Piotrowski, Paul Harper, Tien Truong, and Joshua Kanefield•Bond Counsel for City: Stradling Yocca Carlson & Rauth – Jon Guz•Municipal Advisor: PFM Financial Advisors – Mike Berwanger and Louise Houghton•Lender: TD Public Finance, LLC•Bond Counsel for Lender: Chapman and Cutler LLP Financing Team3 4 Background4
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3 180220260300340380420460Monthly EnergyRolling 12 month Average SVP Historic Load Growth5
•Two Multi-phased Activities (SVP and CAISO)•Analyzed New Load for Upcoming Projects and Load Ramp–Additional Power and Transmission Capacity–CAISO to develop and construct projects for transmission capacity–Working with CAISO on additional transmission capacity and growth•SVP In-City Projects–Consultant support–Rebuild receiving stations–New transmission–Upgrading existing transmission–Battery storageLoad Growth - Key Priorities6 Northern Receiving Station5
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Powering the South Bay7
LS 230 kV (Newark to NRS)LS 230 kV (Metcalf to San Jose B)115 kV (NRS to KRS)50MW/200MWh Battery Energy Storage Project230 kV (San Jose B to NRS)Power PlantAlameda CountyCity of Santa Clara In ProgressProposedRegional
Newark
MetcalfEnergy CenterLos Esteros Critical Energy Facility (LECEF)In Progress LS 230 kVProposed 230 kVIn Progress 115 kVDonald von RaesfeldPower PlantIn Progress LS 230 kVSan Jose B SVP Switching Station (SSS)
NRSKRS
Receiving Station Projects8 Kifer and Scott Receiving Stations (KRS & SRS)Northern Receiving Station(NRS) • Full rebuild and expansion• Costs: $221.2 Million• Contractor: DMZ Builders• ScheduleNTP issued Aug. 20, 2025Construction underway• Estimated completion date: • SRS: Mar. 5, 2029• KRS: Jun. 23, 2029• Upgrade and expansion• Costs: $148.5 Million• Contractor: Henkels & McCoy West• ScheduleNTP issued Jul. 29, 2025Construction underway• Estimated completion date:• Jun. 13, 2028 7 8
5 Proposed Transmission Project9CAISO 3rd230kV T-Line into NRS (New 230kV T-Line Improvements)• Costs: $109.3 Million• Schedule• Procurement contracts planned for mid-2027• Estimated start date: 2027• Estimated completion date: 2031 •City of Santa Clara Electric Revenue Bonds Series 2024A-Bond proceeds of $130 million for capital projects (Principal of $112.2 million)-Proceeds remaining as of July 1, 2026: $70 million – spend by September 2026•Projects funded-SRS, KRS, and NRS totaling $376 million•Planned 2ndtranche-$246 million remaining planned for calendar year 2025-Deferred issuance to July 2026 due to milestone delaysAdding New 230kV T-Line Improvements project-New total funding needs of $350 millionTranche 1 Debt Issuance and Update10 9 10
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Financing Plan11
Total*New 230kV T-Line Improve.NRSSRSKRS(in $ Millions)$479.0$109.3$148.5$107.4$113.8Total Cost$130.0-$ 60.0$ 35.0$ 35.01sttranche Debt Issuance$ 31.0-$ 16.0$ 9.0$ 6.0Load Development Fee$ 12.4$ 5.4$ 2.9$ 1.9$ 2.2Customer Service Charges$173.4$ 5.4$ 78.9$ 45.9$ 43.2Subtotal / Funded to date$305.5$103.9$ 69.6$ 61.5$ 70.6Remaining Debt IssuanceCapital Projects Funding12* Preliminary project cash flow estimates and do not include contingencies. 11 12
7 •Limit impacts to cash reserves and liquidity–SRS, KRS, NRS, and New 230kV T-Line Improvements projects have total estimated cost of $479 Million–Keeping a healthy 497 days* of cash-on-hand is one key factor in maintaining SVP’s AA-credit rating (by S&P Global and Fitch Ratings)•Rates–Avoid sudden or large rate increases to Santa Clara customers–Large industrial customers will be responsible for most of the debt costs•Intergenerational Equity–Share cost burden between current and future rate payers who will benefit from system improvementsWhy Debt Finance?13*FY 2024/25 Actual SVP Revenue14Residential 5.8%Commercial 3.6%Municipal 0.4%Industrial 90.2%*FY 2024/25 Actual•> 93% Industrial and Commercial customers*13 14 8
•Allows flexibility with cashflow timing•Preserves cash to support credit ratings•Avoids cash outlays for immediate debt service payments •Overall cost savings on Net Present Value (NPV) basis –True cost of borrowing over time, accounting for the time value of money–$2.19 Million savings Scenario 1–$11.51 Million savings Scenario 2Why Revolving Credit Facility?15 •A Revolving Credit Facility Not-to-Exceed $350 Million•Key terms:–5-year final maturity (June 2031)–Undrawn Fee = 20 bps–SOFR* Loan Interest Rate – approximately 3.80% average over the past year–Fee and Rate based on credit rating of A+ or above•Current SVP credit rating = AA-•Cost of Issuance of approximately $150,000•Scheduled closing date of July 15, 2026Financing Plan16* Secured Overnight Financing Rate. It is a variable rate. 15 16
9 Financing and Project Delivery Timeline1720212031KRS: PlanningSRS: PlanningNRS: PlanningTranche 1, $130M: 2021 - 2026Oct. 2024Jul. 2025NRS: ConstructionNTP(1)Aug. 2025KRS & SRS: Construction NTP(1)Jun. 2026Credit Agreement $350M:6/2026 – 12/2027Tranche 2, $350M: 2026 - 2031Aug. – Oct. 2021(1). Notice to ProceedJun. 2028 NRS: est. CompletionJan. 2028Mar. 2029 SRS: est. CompletionJun. 2029 KRS: est. CompletionMid-2027New 230kV T-Line Improvements: est. Design Award2031New 230kV T-Line Improvements: est. CompletionDec. 2022NRS: DesignOct. 2022KRS & SRS: Design 18 Fiscal Impact18
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10 Based on current capital project cash flow projection•Initial Plan (2ndtranche): long-term fixed-rate bonds–Issue: July 2026 and July 2029•Scenario 1: use cash for 18 months–Issue long-term fixed-rate bonds: January 2028•Scenario 2: reduce cash flow projection by 50% –use credit facility for 24 months–Issue long term fixed-rate bonds: July 2028Evaluation of Financing Options19 Evaluation of Financing Options (cont’d)20Scenario 2Scenario 1Initial Plan (2ndTranche)Scenario (in $ Millions)Credit Agreement + LT Bonds issued 7/2028Credit Agreement + LT Bonds issued 1/2028LT Bonds issued 7/2026 & 7/2029Assumptions3.48%3.47%3.59%Bond True Interest Cost (TIC)$4.67 $4.68 N/ATotal Credit Agreement and Cash/Short Term Costs1$401.4 $413.0 $415.9 Total Long Term Bond Debt Service$278.72 $288.04 $290.23 Net Present Value (NPV) @ 3.50%$11.51 $2.19 N/ANPV Savings6/30/202812/31/2027N/ACredit Agreement Termination Date $29.53 $19.23 N/ALT Bond Debt Service Payments until Termination Date$24.86 $14.55 N/ALT Bond Cost Avoidance 1). Includes cost of issuance, interest expense unutilized fees and lost cash interest earnings 19 20
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Recommendations21

1.That the City Council by Resolution authorize and approving the execution, delivery and performance of Revolving Credit Agreement with TD Public Finance, LLC in an amount not to exceed $350,000,000 to provide interim financing for capital costs of the Electric Utility consistent with the Capital Improvement Plan, approving the execution of financing documents and authorizing certain other related actions consistent with the financing; and,2.Authorize the City Manager, Director of Finance, Director of Silicon Valley Power, City Attorney, and Assistant City Clerk to execute all required agreements necessary to consummate any of the transactions contemplated by the agreements and documents approved under the Resolution and to make any changes necessary to complete the financing transaction.Recommendations22 21 22
12 City Council MeetingItem 4: RTC 26-352Adoption of Resolution Approving the Execution, Delivery and Performance of a Revolving Credit Agreement with TD Public Finance, LLC for Capital Costs for the Electric System in the Amount Not-to-Exceed $350,000,000 and Authorizing the Execution, Delivery and Performance of Related Documents and Certain Other Actions in connection with this Financing July 7, 202623