Dollars and Cents: Ways to Save and be More Resourceful to the Last Drop Presented by Rochelle Owen

Objective In this presentation, USDA, Rural Development staff will provide information about components to a preliminary engineering report (PER) which can benefit a community and the operation of their system. Highlights will include actions a community can take even before they have hired an engineer and are looking for project funding. Topics will range from energy use and assets to operators and documents communities can leverage to be their own best advocate.

Similar System Cost Calculation Get 4 Figures Total Gallons sold to Residential Users Total Gallons sold (Residential & Other) Total Number of Residential Connections Total System Revenue Sales Taxes & Assessments

Similar System Cost Calculation Total Water Sales to Residential Customers/ Total Number of Residential Customers/ 12 months = Gallons per EDU Example: 74,797,6000 gallons sold to Residential Customers/ 928 residential customers/ 12 months = 6,717 gallons per EDU

Similar System Cost Calculation Total Water Sales in Gallons/ Gallons per EDU = Total Number of EDUs in the system Example: 101,861,536 total gallons sold/ 6,717 gallons per EDU/ 12 months = 1,264 EDUs total in the system

Similar System Cost Calculation Total System Revenue/ Total Number of EDUs in the system/ 12 months = Monthly Cost per EDU Example: $608,843 total system revenue/ 1,264 EDUs total in the system/ 12 months = $40.14 Monthly Cost per EDU

Preliminary Engineering Report (PER) RUS Bulletin 1780-2 Section 1 – Project Planning Community Engagement – How has the community been involved in the project planning? How has the community developed an understanding of the need and funding strategies? Community Board Meetings Public Meetings Information sent with utility bills Articles in local newspapers Population Trends – Provide population data for the service area.

Preliminary Engineering Report (PER) RUS Bulletin 1780-2 Section 2 – Existing Facilities Location Map / System Map – Provide a map and a schematic process layout of all existing faculties. Identify what is no longer in use or abandoned. Have photographs of the existing facilities. History – When was the system constructed, renovated, expanded, or removed from service. Condition of Existing Facilities / Inventory and Assessment of System Assets – Describe the condition of the entire existing system. Financial Status – Provide the recent audits or financial statements Current Rate Schedule Operations & Maintenance Energy Costs Debts and Reserve Accounts *gallons per EDU, # of EDUs, monthly cost per EDU suggested to go here Water / Energy / Waste Audits – Provide water loss study, energy assessments, or testing results.

Preliminary Engineering Report (PER) RUS Bulletin 1780-2 Section 3 – Need for Project Health, Sanitation, and Security – Describe the concerns and include any regulatory agency information. Aging Infrastructure – What are the inadequacies of the system? Reasonable Growth – Describe the reasonable growth capacity that is necessary to meet the needs during the planning period. Section 4 – Alternative Considered Description of the alternatives considered. Even technically infeasible options should be mentioned. Section 5 – Selection of an Alternative Life Cycle Cost Analysis is used to evaluate the alternatives. Non-monetary factors should also be considered for the recommended alternative.

Preliminary Engineering Report (PER) RUS Bulletin 1780-2 Section 6 – Proposed Project Provide the full description of the recommended alternative. Total Project Cost Estimate – This should be a detailed cost estimate which includes construction, equipment, land acquisition, legal, engineering, interim financing, refinancing, construction contingency, and other associated costs. Annual Operating Budget / Maintenance, Repair, and Operation Plan – Provide itemized information for both the existing system and proposed project about income and O&M costs Reserves Debt Service Reserve Short-Lived Asset Reserve – These are assets not covered under O&M. Pumps • Meters • Hydrants • UV lamps • Back-up generator Section 7 – Conclusion Provide additional system recommendations.

Asset Management Plans Components within the PER System Map (Section 2 Existing Facilities) Inventory and Assessment of System Assets (Section 2 Condition of Existing Facilities) Maintenance, Repair and Operation Plan (Section 6 Annual O&M, Section 7 Recommendations) Customer Rate Study (Section 2 Financial Status) Audit (Section 2 Financial Status and is done during the funding process and life of the loan)

Electronic Frontiers RD Apply Online application intake system for WEP projects Applicant controls who can access by assigning roles Service area mapping feature Non-linear entry and progress at a glance https://www.rd.usda.gov/programs-services/rd-apply

American Iron and Steel Implementation and Compliance American Iron and Steel (AIS) WEP projects obligated after May 5, 2017 have AIS requirements “Primarily iron or steel” is defined as a product made of greater than 50 percent iron or steel, measured by cost. The requirements do not apply to products not listed in the statute or items that are at the construction site temporarily. Refer to RUS Bulletin 1780-35 for more information and contract provisions. Lined or unlined pipe and fittings Manhole covers and other municipal castings Hydrants Tanks Flanges Pipe clamps and restraints Valves Structural steel Reinforced precast concrete Construction materials

Water and Waste Disposal Loans & Grants Objective Provide water, waste water and storm water financing in rural areas Purpose and Uses Build, repair and improve public water systems, and waste collection and treatment systems. Other related soft costs (engineering, land, legal, etc.) Applicant Public Entities Non-profit Corporations Water or Sewer Districts Financing Types Guarantee (up to 80%) Direct Loan/Grant Direct Loan Revenue, GO, or mix of the two Loan/Grant Direct loan & grant Service areas with MHI below $55,784 may be considered for grant assistance Term & Interest Rates Up to 40 Year Term Market at 3.500% (>$55,784), Intermed 2.750%, Poverty 2.125% (<$44,627) Interest rates for July 2019 quarter Population Rural areas and towns of less than 10,000 population

WEP Allocation and Obligation

WEP Allocation and Obligation

Rochelle K. Owen, AICP Director of Community Programs | Indiana rochelle.owen@usda.gov Office: 317-295-5767 USDA is an equal opportunity provider, employer, and lender.