01-10028 Agr KDHE LoanConMlitlxt905B1re
(Published in The Salina Journal April 13, 2001)
ORDINANCE NUMBER O1-10028
AN ORDINANCE AUTHORIZING THE EXECUTION OF A LOAN
BETWEEN SALINA, KANSAS AND THE STATE OF KANSAS, ACTING
AND THROUGH THE KANSAS DEPARTMENT OF HEALTH AND ENVIRONMENT
FOR THE PURPOSE OF OBTAINING A LOAN FROM THE KANSAS PUBLIC WATER
SUPPLY LOAN FUND FOR THE PURPOSE OF FINANCING A PUBLIC WATER SUPPLY
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 Safe Drinking Water Act Amendments of 1996 [PL 104-182] to the
Safe Drinking Water Act (the "Federal Act") established the Drinking Water Loan Fund to assist
Ipublic water supply systems 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
states; and
Agency (the "EPA") to administer a revolving loan program operated by the individual
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 Public Water Supply Loan Act, K.S.A. 65-163d
et seq., as amended (the "Loan Act"), the State of Kansas (the "State") has established the Kansas
Public Water Supply Loan 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 (the ""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 water supply 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
,apitalization 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 water system (the "System'); and
WHEREAS, the System is a Public Water Supply System, 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:
a)
Construction of two new secondary clarifiers;
b)
Improvement and rehabilitation of the recarbonation system;
c)
Rehabilitation of the existing filter and chemical building
including installation of new filter controls;
d)
Rehabilitation and upgrade of the existing laboratory/maintenance
building;
e)
Installation of remote monitoring and control equipment;
f)
Rehabilitation and remodel high service pump station to serve as
an administration building; and
g)
Miscellaneous controls, valves, piping, sitework, and all related
appurtenances thereto.
(the "Project"); and
WHEREAS, the Municipality has taken steps necessary and has complied with the
provisions of the
Loan Act and the provisions of K.A.R. 28-15-50 through 28-15-65 (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 $5,000,000 (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 a loan agreement and certain other
documents relating thereto, and to take certain actions required in order to implement the Loan
Agreement. SO NOW 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 March 14,
2001, 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.
Nll laa,eas•i„a
Section 2. Establishment of Dedicated Source of Revenue for Repayment of Loan.
zant to the Loan Act, the Municipality hereby establishes a dedicated source of revenue for
ment of the Loan. In accordance therewith, the Municipality shall impose and collect such rates,
and charges for the use and services furnished by or through the System, including all
:)vements and additions thereto hereafter constructed or acquired by the Municipality as will
de System Revenues (as defined in the Loan Agreement) sufficient to (a) pay the cost of the
ition and maintenance of the System, (b) pay the principal of and interest on the Loan as and
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
the pledge of System Revenues to any Additional Revenue Obligations. 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 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
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 Date. This Ordinance shall take effect and be in full force from and
after its passage by the Governing Body of the City and publication in the official City newspaper.
Introduced: April 2, 2001
Passed: April 9, 2001
sAayvor
C�
Alan E. Jilka,
(SEAL)
ATTEST:
Lieu Ann Nicola, City Clerk