Strategies for Financing Projects David Flesher (USDA-Rural Development) Tim Wendland (Idaho DEQ) Dennis Porter (Idaho Commerce) Rick Skinner (Skinner Fawcett LLP ) March 20, 2013

Skinner Fawcett LLP Goals 1.Provide helpful general information 2.Inform you of available resources

Skinner Fawcett LLP City of Bliss Before After

Skinner Fawcett LLP Discussing the General Concept Establish a Citizen’s Group Sewer: Treatment / Collection / Permits Current average user rates? Separate Enterprise Funds?

Skinner Fawcett LLP Discussing the General Concept MCL or Permit Violation? Is project a “need” or a “want” Include Area Planning Assoc. or Grant Writer Include Potential Funding Agencies

Skinner Fawcett LLP Selecting a Project Engineer RFQ / RFP process IDOC process (CDBG handbook) –Prepare Request for Proposals –Advertise RFP –Rank proposals –Negotiate and Execute Contract

Skinner Fawcett LLP Get Legal, Administrative and Funding Entities Involved Early in the Process USDA RD, IDEQ, IDOC, USACE Bond and/or general counsel Grant administrators

Skinner Fawcett LLP Funding the Wastewater Facility Study / PER and ER / EID Sufficient funds for grant match? If not, can rates be raised? IDEQ – Planning Grants –$250k/year water –$250k/year sewer –Maximum 50%

Skinner Fawcett LLP Funding the Wastewater Facility Study / PER and ER / EID USDA-RD – Predevelopment Planning Grants & Search Grants –PPG $25K/year –% varies –SEARCH $35-50K/year –up to 100% for very low income systems)

Skinner Fawcett LLP Funding the Wastewater Facility Study / PER and ER / EID Construction not a follow-on requirement Make sure to include ER / EID costs –An EID is required if RD grant funds are involved

Skinner Fawcett LLP Environmental Report Open Bond Market / Idaho Bond Bank –Must comply with ESA, CWA, Wetlands USDA-RD, IDEQ, IDOC –Must meet NEPA and Agency Specific requirements –Lead Agency assigned on jointly funded projects primary contact for completing the environmental report

Skinner Fawcett LLP Establish a Basic Funding Package Project team needs to include Elected officials, citizens, Project Engineer, and representatives from each potential funding agency Can apply for assistance prior to bond election Elections only held in November and May Early discussions with funding agencies is vital

Legal Alternatives City wastewater revenue bond election Local improvement districts Water and sewer districts Judicial confirmation of city or county wastewater obligations Refinancing of obligations Idaho Bond Bank assistance

Skinner Fawcett LLP Planning and Educating for the Bond Election Select experienced Bond Counsel Honest and straightforward with public The governing board in agreement before moving forward Prepare accurate information for handouts, power-points, etc.

Skinner Fawcett LLP Planning and Educating for the Bond Election Ready for questions regarding user rates. Local officials ready to answer questions Rely on the Project Engineer or Funding Agency Representatives for technical or funding questions RD Area Office Staff is available to attend meetings

Skinner Fawcett LLP Passing a Bond Election Local officials in control In public meetings – engineers don’t do most of the talking Don’t assume the recommended option will be how community wants to proceed –Local officials need to decide which option to pursue Use photos It is always the community’s project

Skinner Fawcett LLP Passing a Bond Election BeforeAfter

Skinner Fawcett LLP Judicial Confirmation Request a Judge issue ruling that improvements are ordinary and necessary Recognized by IDEQ, IDOC, Idaho Bond Bank, & Open Market Rural Development doesn’t recognize: Projects require broad based community support Communities that pass a bond election have priority

Skinner Fawcett LLP Advantages of Joint Funding Funding Agencies meet quarterly to review applications and inquiries in-hand –We are committed to actively maximizing the amount of funding available to the state Goal is cooperation, not competition Multiple Funding Agencies can be beneficial

Skinner Fawcett LLP Applying for Funding IDEQ-SRF – Requests due January –Draft funding list published in March –Final funding list published in April/May –Funding July 1 through June 30 IDOC-CDBG – Uses a grant admin –Application in November –Addendum in March –Decision by May –Funding by June

Skinner Fawcett LLP Applying for Funding USDA-RD – Apply anytime –Area Office staff will assist with application –Funding occurs December - August

Skinner Fawcett LLP Effective Construction Management Milestone Meetings Before or at funding approval At or after bid opening Pre-Construction Conference During Construction (monthly) Substantial Completion Final Completion Warranty Inspection

Groundbreaking Invite local media Inform community that project is under way Elected officials visit community

Skinner Fawcett LLP USDA Rural Development Loan and Grant Program Provides funds to rural areas (<10,000 pop) Construct, enlarge, extend, and/or improve water or sewer systems, including solid waste Unable to get credit elsewhere (reasonable rates/ terms)

Skinner Fawcett LLP USDA Rural Development Loan and Grant Program Legal authority to incur debt, own, operate, and maintain facility Public Bodies must pass bond election for the amount of the debt Indian Tribes, Associations must have board approval, majority of member approval and repayment ability

Skinner Fawcett LLP USDA Rural Development Rates – Fixed; depend on service area MHI and existing violations Terms –Revenue bond - 40 yrs w/ RD grant –GO Bond or LID - 30 years max Security –Cities & Districts – Revenue, LID, or GO Bond –Non-Profit’s - mortgage/deed of trust & promissory note

Skinner Fawcett LLP USDA Rural Development MHI - 5-year –Less than $49,561 = 45% - 75% –Greater than $49,561 = 0 Similar system costs + $40+/user/month Availability of funds = 3:1 loan to grant No “grant only” for regular program – must be with an RD loan

Skinner Fawcett LLP USDA RD Contacts in Idaho North Idaho, Coeur d’Alene (208) Serving: Benewah, Bonner, Boundary, Clearwater, Idaho, Kootenai, Latah, Lewis, Nez Perce and Shoshone counties Western Idaho, Caldwell (208) Serving: Ada, Adams, Boise, Canyon, Elmore, Gem, Owyhee, Payette, Valley and Washington counties Central Idaho, Twin Falls (208) Serving: Blaine, Camas, Cassia, Gooding, Jerome, Lincoln, Minidoka and Twin Falls counties Eastern Idaho, Blackfoot (208) Serving: Bannock, Bear Lake, Bingham, Bonneville, Butte, Caribou, Clark, Custer, Franklin, Fremont, Jefferson, Lemhi, Madison, Oneida, Power & Teton Counties

Skinner Fawcett LLP DEQ Funding Opportunities Planning Grants Construction Loans –State Revolving Fund (SRF) Loans 29

Skinner Fawcett LLP DEQ State Office Contact Information Planning Grants Charlie Parkins deq.idaho.gov DWSFR Loans Tim Wendland September 2012 CWSFR Loans MaryAnna Peavey

Idaho Commerce State Community Development Block Grant (CDBG) Program –Federal funds (HUD) –Idaho’s 2013 allocation = $7.0M Contacts, (208) –Regions 1 & 2: Tony Tenne, ext –Regions 3 & 4: Sharon Deal, ext –Regions 5 & 6: Amanda Ames, ext. 2136

Skinner Fawcett LLP CDBG CDBG Eligible Applicants –Cities and Counties –Sub-grants okay to special districts/non-profits Must Meet National Objectives –Benefits an area/family that’s 51% low to moderate income –Prevents/eliminates slum and blight –Eliminates imminent threat/emergency

Skinner Fawcett LLP CDBG Eligible Activities Sewer or water systems Solid waste facilities Fire or EMT stations Hospitals or health facilities Infrastructure for jobs Infrastructure for affordable housing Youth/child care centers Downtown improvements Senior/community centers Construction or rehabilitation of public…

Skinner Fawcett LLP CDBG Funding partners –City, County, sub-recipient, DEQ, USDA RD, ITD, EDA, USACE, urban renewal districts, bond bank Application process –Not enough to grants to cover demand Competitive factors –Match, need, community impact, readiness

Questions? Skinner Fawcett LLP

Dennis Porter, Manager Community Development Idaho Dept of Commerce (Boise) Ext Tim Wendland Loan Program Manager Idaho DEQ (Boise) (208) David A. Flesher Director, Community Programs USDA Rural Development (Boise) Boise, Idaho Rick Skinner Bond Counsel Skinner Fawcett LLP (Boise)