23-11181 Authorizing an Amendment to Loan Agreement for WWTP Improvements (Summary published in The Salina Journal on November 2.l ,2023.)
(Puhliched nn the City of Salina'c wehcite for minimum of one week from November 2 I to November
2� ,2023.)
111 ORDINANCE NO. 23-11181
t2 AN ORDINANCE AUTHORIZING THE EXECUTION OF THE FIRST AMENDMENT TO
THE 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 CONTROL REVOLVING FUND FOR THE PURPOSE
OF FINANCING A WASTEWATER TREATMENT 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 FIRST AMENDMENT TO 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 various upgrades to the Wastewater Treatment Plant to improve effluent
quality and reduce nutrients in the effluent discharge (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 an amendment to the loan; and
WHEREAS, KDHE has informed the Municipality that it has been approved for a loan in
amount of not to exceed Forty-One Million, Five Hundred Thousand Dollars [$41,500,000] (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 First Amendment to the Loan Agreement and to enter into a
First Amendment to the Loan Agreement and certain other documents relating thereto, and to take
certain actions required in order to implement the First Amendment to the Loan Agreement.
THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF
SALINA, KANSAS:
Section 1. Authorization of First Amendment to the Loan Agreement. The Municipality
is hereby authorized to accept the Loan and to enter into a certain First Amendment to the Loan
Agreement, with an effective date of June 26, 2023, with the State of Kansas acting by and through
the Kansas Department of Health and Environment (the "First Amendment to the Loan
Agreement") to finance the Project Costs (as defined in the First Amendment to the Loan
Agreement). The Mayor and Clerk are hereby authorized to execute the First Amendment to 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 (as defined in the Loan Agreement) 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, (c) pay all other amounts due at any time under the Loan Agreement,
and (d) pay the principal of and interest on Additional Revenue Obligations (as defined in the Loan
Agreement) as and when the same become due; provided, however, the pledge of the System
Revenues contained herein and in the Loan Agreement (i) shall be subject to reasonable expenses of
operation and maintenance of the System, and (ii) shall be junior and subordinate in all respects to
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the pledge of System Revenues to any Additional Revenue Obligations. In the event that the System
L 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 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.
w In accordance with the Loan Act, the obligations under the Loan and the First Amendment to the
To 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 are hereby further
U 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 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 First Amendment to 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:
LOrdinance No. 23-11181 Summary
On November 13, 2023 the City of Salina, Kansas, passed Ordinance No. 23-11181.
The ordinance authorizes the first amendment to the loan 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 in the amended amount of
$41,500,000 for the purpose of financing improvements to the Wastewater Treatment
Plant. 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: November 6, 2023
Passed: November 13, 2023
p
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Bill Longbine, Vice- "�yor
(SEAL)
ATTEST: .
Nikki Goding, City Clerk
L The p .lic. '4 n summary set forth above is certified this/f ay of NOV., 2023.
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G - . ' Beng. , City Attorney
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