RECOMMENDATION TO COUNCIL
Staff recommends that the City Council adopt a resolution authorizing the City Manager to execute the Clean Water State Revolving Fund (CWSRF) Installment Sale Agreement Amendment 2 for the low interest loan (1.3 percent) of $29,674,755 from the California State Water Resources Control Board (SWRCB) for the Pleasant Grove Wastewater Treatment Plant Energy Recovery Project.
| BACKGROUND
The Pleasant Grove Wastewater Treatment Plant (PGWWTP) Energy Recovery Project is adding energy-recovery facilities that will beneficially utilize digester gas (which has a high methane fraction) produced by the new treatment processes constructed as part of the PGWWTP Expansion Project. The Energy Recovery Project includes the following facilities: microturbines which will produce electrical power to offset a portion of PGWWTP’s power demand and will provide heat to the Expansion Project, receiving facility for High Strength Waste (such as pre-processed food waste and fats, oils and grease), systems for conditioning and upgrading the digester gas to produce renewable compressed natural gas r(CNG) to be used by the City’s solid waste collection vehicles as fuel, a fueling station, and associated parking.
Construction of this project has already begun. The Energy Recovery Project construction is behind the scheduled completion in February 2022; therefore an amendment to the City’s CWSRF Installment Sale Agreement for the low interest loan (1.3 percent) of $29,674,755 from the SWRCB is required. The CWSRF Installment Sale Agreement Amendment 2 extends the construction date from February 10, 2022, to January 31, 2023. Based on the current status of the construction projects at the PGWWTP, it is anticipated that the Energy Recovery Project will not be complete until after January 2023; however during a meeting held on June 22, 2022, the SWRCB requested that we approve the amendment with the date of January 31, 2023, and has stated they will process a third amendment to extend the date again at a later date (which will be processed through a separate council communication).
| FISCAL IMPACT
The adoption of the CWSRF Installment Sale Agreement Amendment 2 initiates the financial commitments to repay the loans and repayment will be based on the amount of the loan used, which has not been revised in the amendment. The Debt Service Agreement between the City and South Placer Wastewater Authority (SPWA) will allow all CWSRF loan repayment costs made by the City to be fully reimbursed by the SPWA agency partners; therefore resulting in no direct fiscal impact to the City.
The CWSRF interest rate of 1.3 percent is the lowest available financing option evaluated for SPWA to fund these projects.
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ENVIRONMENTAL REVIEW
Implementation of the PGWWTP Energy Recovery Project was previously evaluated in the Pleasant Grove Wastewater Treatment Plant Expansion and Energy Recovery Project Final Initial Study/Mitigated Negative Declaration (IS/MND) (SCH# 2016122040) (certified by the City Council on April 6, 2017), and the Addendum to the IS/MND (SCH# 2016122040) (certified by the City Council on November 7, 2018). The improvement plans included in the design-assist and construction agreement are consistent with the project evaluated in the certified Final IS/MND and the Addendum, and consequently no additional CEQA action is required for approval of this amended CWSRF agreement.
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CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS
Goal F - Invest in well-planned infrastructure and growth
| Respectfully Submitted,
Tracie Mueller, Senior Engineer
Richard Plecker, Environmental Utilities Director | | | 
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Dominick Casey, City Manager
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