State Revolving Fund Loan Program Indiana Finance Authority State Revolving Fund Loan Program State Revolving Fund Loan Program ACEC August 26, 2019 State Revolving Fund 100 N. Senate Avenue, Room 1275 Indianapolis, Indiana 46204 cmeiners@ifa.in.gov 317-234-3661

Indiana Finance Authority State Revolving Fund Loan Program SRF Organizational Chart Jim McGoff COO & Director of Environmental Programs State Revolving Fund Loan Programs Matt Martin Finance Manager Bill Harkins SRF Program Director Emma Kottlowski Financial Analyst Alison Martin Kary Long Disbursement Coordinator Camille Meiners, PE Technical Review Coordinator Shelley Love WW Administrator April Douglas Environmental Reviewer Staci Orr - Gardner DW Administrator Tracey Trimpe, PE Project Engineer Amanda Rickard, PE Artemis Nikolaou Debbie Wright General Counsel Amy Henninger Compliance Officer Joanie Jones Administrative Assistant Gayle Hicks Bid Coordinator

Indiana SRF Accomplishments As of June 30, 2019 559 loans closed in the Clean Water Program 265 loans closed in the Drinking Water Program Over 390 Communities Served Over $5.1 Billion in loan closings Over $4.6 Billion disbursed to communities Estimated $332 million in savings to borrowers, over the last 5 years (compared to market)

$1.4B + Current Loan Demand Project Priority Lists (PPLs) document the funding need for infrastructure projects in Indiana surpasses our ability to fund through the traditional SRF program. TOTAL DW Q1 PPL $387M WW Q1 Large System PPL $897M WW Q1 Small System PPL $195M $1.4B +

SRF Interest Rates Wastewater SRF Interest Rates User Rates (Over $50) SRF Rates July 1, 2019 – September 30, 2019 Wastewater SRF Interest Rates User Rates (Over $50) ($30 to $50) (Under $30) Tier III (MHI: under $41,746) 2.00% Tier II (MHI: $40,747 to $50,181) Tier I (MHI over $50,181) Drinking Water SRF Interest Rates User Rates (Over $45) ($25 to $45) (Under $25) Tier III (MHI: under $41,746) 2.00% Tier II (MHI: $40,747 to $50,181) Tier I (MHI over $50,181)

Quarter Calendar What’s new? What are the SFY quarters? Q1 Q2 Q3 Q4 July 1 – September 30 Q2 October 1 – December 31 Q3 January 1 – March 31 Q4 April 1 – June 30

Funding Cycle 20 Closings Per Quarter Online Calendar

Funding Cycle Prior SFYs: Fundable Range Established – Q1, July Earmarked Funds Until December Permits Land Bids Financial ByPass – January - June

Funding Cycle SFY 2020: Fundable Range Established – Q1, July Earmarked Funds Until March Permits Land Bids Financial ByPass – April - June

Schedule How to get put on the calendar: PER submitted, ranked and in fundable range Municipal Advisor provides commitment letter to Bill Harkins Bids Opened _______ All Permits approved _____ All Land Acquired ______ Quarter requested Prior to officially being placed on the calendar, above requirements must be met

WW and DW – entire system Asset Management Indiana Code 5-1.2-10-16 WW and DW – entire system Start with the Certification SRF wants one document – the Certification When do you submit the certification? How does this related to the Fiscal Sustainability Plan requirement? Federal vs. State

Asset Management Program Memorandum SRF AMP Documents Documents Available: Asset Management Program Memorandum Asset Management Program Guidelines  Asset Management Program Certification Asset Management Program Checklist Asset Management Program Guidance More information: https://www.in.gov/ifa/srf/2376.htm

Guidelines vs. Guidance AMP Documents Guidelines vs. Guidance

AMP Documents Certification Checklist Guidance Certification

SRF AMP Certification Ask yourself…

SRF AMP Guidance Technical Managerial Financial

Cyber Security Framework SRF AMP Guidance Cyber Security Framework https://www.nist.gov/cyberframework/online-learning/five-functions

Cyber Security Checklist SRF AMP Guidance Cyber Security Checklist Identify Assets Protect Policies Detect Monitor Respond Response Plan Recover Update/Improve

SRF Incentive Programs: GPR NPS Brownfields SRF Incentives SRF Incentive Programs: GPR NPS Brownfields Lead Service Line Replacement Extended Term Financing

SRF Incentives GPR 0.5% interest rate break Categorical/Business Case Submit documentation prior to close Planning, design, construction Non-Point Source 0.5% interest rate break Septic System Elimination, non-point source treatment Submit documentation prior to close Could include entire project cost

Submit documentation prior to close Timing SRF Incentives Brownfields Project 0.5% interest rate break Submit documentation prior to close Timing

Lead Service Line Replacement SRF Incentives Lead Service Line Replacement Interest rate break to 0.00% Only complete lead service lines are eligible *Meter or shut off valve Tracking

Illustration of SRF Cost Savings Lead Line Replacement Incentive Utility ABC’s Financing Cost Original Loan Structured with Lead Line Rate Reduction Loan Debt Service New SRF Loan $10,000,000 $12,500,000 Interest Rate 2.25% 0.00% Amount available for lead line project $ 2,500,000 Interest rate savings will allow Utility to apply $2,500,000 towards costs associated with lead line replacement project at no additional costs to rate payers. Similar methodology is applied to GPR projects.

Interest Rate Increase SRF Incentives Extended Term Financing Up to 35 years Pipe only Useful life Entire project ≥ loan term Slightly higher rate 10 basis points per 5 years Loan Term Interest Rate Increase 21-25 +0.1% 26-30 +0.2% 30-35 +0.3%

How to these work together? SRF Incentives How to these work together? Floor is 2.00% for projects without lead service line replacement Lead service line replacement projects can be as low as 0.00% GPR, NPS, BF all reduced prior to addition of extended term financing increase Examples: Project with GPR: Rate = 2.35%, GPR reduces rate to floor of 2.00% Project with GPR and Extended term of 35 years: Rate = 2.35%, GPR reduces rate to 2.00%, 35 year term increases rate to 2.30% Project with Lead Line Replacement and Extended Term of 35 years: Rate = 2.35%, Lead line replacement reduces rate to 0.00%, 35 year term increases rate to 0.30%

Flood Control Program Transferred to IFA in 2016 from DNR Applications may be submitted at any time Loan Terms Maximum borrowing amount is $250,000 2.0% for loan terms between 1 year and 5 years 2.5% for loan terms over 5 years to 10 years OCRA Match?

Flood Control Program Flood control projects must provide benefits to their communities and may include one or more of the following endeavors: The removal of obstructions and accumulated debris from channels of streams The clearing and straightening of channels of streams The creating of new and enlarged channels of streams, wherever required The building or repairing of dikes, levees, or other flood protective works The construction of bank protection works for streams The establishment of floodways Conducting all other activities that are permitted by the federal Flood Control Act or federal Clean Water Act

Questions?

Technical Review Coordinator Camille Meiners, PE Technical Review Coordinator 317-234-3661 cmeiners@ifa.in.gov www.srf.in.gov