19-10993 Markley-Magnolia Loan Agreement (Summary published in The Sauna Journal on February ly .. 2019.)
(Published on the City of Salina's website for a minimum of one week from February 12. to February Z lo,
2019.)
ORDINANCE NO. 19-10993
AN ORDINANCE AUTHORIZING THE EXECUTION OF A LOAN AGREEMENT
BETWEEN SALINA, KANSAS AND THE STATE OF KANSAS, ACTING BY AND
THROUGH THE KANSAS DEPARTMENT OF HEALTH AND ENVIRONMENT FOR
THE PURPOSE OF OBTAINING A LOAN FROM THE KANSAS WATER POLLUTION
y CONTROL REVOLVING FUND FOR THE PURPOSE OF FINANCING A
WASTEWATER COLLECTION PROJECT; ESTABLISHING A DEDICATED SOURCE
OF REVENUE FOR REPAYMENT OF SUCH LOAN; AUTHORIZING AND APPROVING
CERTAIN DOCUMENTS IN CONNECTION THEREWITH; AND AUTHORIZING
CERTAIN OTHER ACTIONS IN CONNECTION WITH THE LOAN AGREEMENT.
WHEREAS, the Federal Water Quality Act of 1987 (the "Federal Act") established
revolving fund program for public wastewater treatment systems to assist in financing the costs of
infrastructure needed to achieve or maintain compliance with the Federal Act and to protect the
public health and authorized the Environmental Protection Agency (the "EPA") to administer a
revolving loan program operated by the individual states; and
WHEREAS, to fund the state revolving fund program, the EPA will make annual
capitalization grants to the states, on the condition that each state provide a state match for such
state's revolving fund; and
WHEREAS, by passage of the Kansas Water Pollution Control Revolving Fund Act,
K.S.A. 65-3321 through 65-3329, inclusive (the "Loan Act"), the State of Kansas (the `State") has
established the Kansas Water Pollution Control Revolving Fund (the "Revolving Fund") for
purposes of the Federal Act; and
WHEREAS, under the Loan Act, the Secretary of the Kansas Department of Health and
Environment ("KDHE") is given the responsibility for administration and management of the
Revolving Fund; and
WHEREAS, the Kansas Development Finance Authority (the "Authority") and KDHE have
entered into a Pledge Agreement (the "Pledge Agreement") pursuant to which KDHE agrees to
enter into Loan Agreements with Municipalities for public wastewater treatment projects (the
"Projects") and to pledge the Loan Repayments (as defined in the Pledge Agreement) received
pursuant to such Loan Agreements to the Authority; and
WHEREAS, the Authority is authorized under K.S.A. 74-8905(a) and the Loan Act to issue
revenue bonds (the "Bonds") for the purpose of providing funds to implement the State's.
requirements under the Federal Act and to loan the same, together with available funds from the
EPA capitalization grants, to Municipalities within the State for the payment of Project Costs (as
said terms are defined in the Loan Act); and
WHEREAS, Salina, Kansas (the "Municipality") is a municipality as said term is defined in
the Loan Act which operates a wastewater collection and treatment system (the "System"); and
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WHEREAS, the System is a public Wastewater Treatment Works, as said term is defined in
the Loan Act; and
WHEREAS, the Municipality has, pursuant to the Loan Act, submitted an Application to
KDHE to obtain a loan from the Revolving Fund to finance the costs of improvements to its System
consisting of the following:
Construction of 7,725 linear feet of 8-inch gravity sewer, 485 linear feet of 10-inch gravity
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sewer, and construction of a new wastewater pump station no. 57 and force main to serve the
Markley/Magnolia service area (the "Project"); and
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WHEREAS, the Municipality has taken all steps necessary and has complied with the
provisions of the Loan Act and the provisions of K.A.R. 28-16-110 to 28-16-138 (the
"Regulations") applicable thereto necessary to qualify for the loan; and
WHEREAS, KDHE has informed the Municipality that it has been approved for a loan in
amount of not to exceed Two Million, Two Hundred Fifty Thousand Dollars [$2,250,000] (the
"Loan") in order to finance the Project; and
WHEREAS, the governing body of the Municipality hereby finds and determines that it is
necessary and desirable to accept the Loan and to enter into a loan agreement and certain other
documents relating thereto, and to take certain actions required in order to implement the Loan
Agreement.
THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF
SALINA, KANSAS:
Section 1. Authorization of Loan Agreement. The Municipality is hereby authorized to
accept the Loan and to enter into a certain Loan Agreement, with an effective date of December 11,
2018, with the State of Kansas acting by and through the Kansas Department of Health and
Environment (the "Loan Agreement") to finance the Project Costs (as defined in the Loan
Agreement). The Mayor and Clerk are hereby authorized to execute the Loan Agreement in
substantially the form presented to the governing body this date, with such changes or modifications
thereto as may be approved by the Mayor and the Municipality's legal counsel, the Mayor's
execution of the Loan Agreement being conclusive evidence of such approval.
Section 2. Establishment of Dedicated Source of Revenue for Repayment of Loan.
Pursuant to the Loan Act, the Municipality hereby establishes a dedicated source of revenue for
repayment of the Loan. In accordance therewith, the Municipality shall impose and collect such
rates, fees and charges for the use and services furnished by or through the System, including all
improvements and additions thereto hereafter constructed or acquired by the Municipality as will
provide System Revenues or levy ad valorem taxes without limitation as to rate or amount upon all
the taxable tangible property, real or personal, within the territorial limits of the Municipality to
produce amounts which are sufficient to (a) pay the cost of the operation and maintenance of the
System, (b) pay the principal of and interest on the Loan as and when the same become due, and (c)
pay all other amounts due at any time under the Loan Agreement; provided, however, no lien or
other security interest is granted by the Municipality to KDHE on the System Revenues under this
Agreement. In the event that the System Revenues are insufficient to meet the obligations under the
Loan and the Loan Agreement, the Municipality shall levy ad valorem taxes without limitation as to
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rate or amount upon all the taxable tangible property, real or personal, within the territorial limits of
the Municipality to produce the amounts necessary for the prompt payment of the
obligations under the Loan and Loan Agreement.
In accordance with the Loan Act, the obligations under the Loan and the Loan Agreement
shall not be included within any limitation on the bonded indebtedness of the Municipality.
Section 3. Further Authority. The Mayor, Clerk and other City officials and legal counsel
are hereby further authorized and directed to execute any and all documents and take such actions
as they may deem necessary or advisable in order to carry out and perform the purposes of the
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Ordinance, and to make alterations, changes or additions in the foregoing agreements, statements,
instruments and other documents herein approved, authorized and confirmed which they may
approve, and the execution or taking of such action shall be conclusive evidence of such necessity
or advisability.
Section 4. Governing Law. The Ordinance and the Loan Agreement shall be governed
exclusively by and construed in accordance with the applicable laws of the State of Kansas.
Section 5. Effective. This ordinance shall be in full force from and after its adoption and
publication once in the official city newspaper by the following summary:
Ordinance No. 19-10993 Summary
On February 11, 2019 the City of Salina, Kansas, passed Ordinance No. 19-10993.
The ordinance authorizes an agreement between the City of Salina and the Kansas
Department of Health and Environment for the purpose of obtaining a Kansas Water
Pollution Control Revolving Loan for the purpose of financing a public wastewater
collection project. A complete copy of the ordinance is available at www.salina-ks.gov
or in the office of the city clerk, 300 W. Ash Street, free of charge. This summary is
certified by the city attorney.
Introduced: February 4, 2019
Passed: February 11, 2019
Trent W. Davis, M.D., Mayor
(SEAL)
ATTEST:
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Staid/ ip(ea
Shandi Wicks, CMC, City Clerk
The pa,,lic. 'on stu mary set forth above is certified this /344 day of February, 2019.
Gr-# . BengtsoCity Attorney
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