04/21/2010 Agreement
IYlonr6~ C()a/tty ~ /G-f'k's o/4c.~
~ I~_:r. r;. r;V A '-
STATE OF FLORIDA
DEPARTMENT OF ENVIRONMENTAL PROTECTION
AND
MONROE COUNTY, FLORIDA
CLEAN WATER STATE REVOLVING FUND
CONSTRUCTION LOAN AGREEMENT
WW602091
-!#"
iej
'\t. .,;:
c:; C-:l ~
- ..:.:~) .=~
-~,: ,,~) ::c
"' :-1 )>
C)
",
Florida Department of Environmental Protection
Bureau of Water Facilities Funding
Bob Martinez Center
2600 Blair Stone Road, MS 3505
Tallahassee, Florida 32399-2400
--r,
--
r-
",
o
,..,
o
::0
::0
fT1
c-)
o
=0
o
CLEAN WATER STATE REVOLVING FUND CONSTRUCTION LOAN AGREEMENT
CONTENTS
PAGE
ARTICLE I - DEFINITIONS
1.01. WORDS AND TERMS.
1.02. CORRELATIVE WORDS.
ARTICLE II - WARRANTIES, REPRESENTATIONS AND COVENANTS
2.01. WARRANTIES, REPRESENTATIONS AND COVENANTS.
2.02. LEGAL AUTHORIZATION.
2.03. AUDIT AND MONITORING REQUIREMENTS.
ARTICLE III - LOAN REPAYMENT ACCOUNT
3.01. LOAN DEBT SERVICE ACCOUNT.
3.02. INVESTMENT OF LOAN DEBT SERVICE ACCOUNT MONEYS.
3.03. LOAN DEBT SERVICE ACCOUNT WITHDRAWALS.
3.04. ASSETS HELD IN TRUST.
ARTICLE IV - PROJECT INFORMATION
4.01. PROJECT CHANGES.
4.02. TITLE TO PROJECT SITE.
4.03. PERMITS AND APPROVALS.
4.04. ENGINEERING SERVICES.
4.05. PROHIBITION AGAINST ENCUMBRANCES.
4.06. COMPLETION MONEYS.
4.07. CLOSE-OUT.
4.08. LOAN DISBURSEMENTS.
ARTICLE V - RATES AND USE OF THE SEWER SYSTEM
5.01. RESERVED
5.02. NO FREE SERVICE.
5.03. MANDATORY CONNECTIONS.
5.04. RESERVED.
5.05. MAINTENANCE OF THE SEWER SYSTEM.
5.06. ADDITIONS AND MODIFICATIONS.
5.07. COLLECTION OF REVENUES.
ARTICLE VI - DEF AUL TS AND REMEDIES
6.01. EVENTS OF DEFAULT.
6.02. REMEDIES.
6.03. DELAY AND WAIVER.
ARTICLE VII - THE PLEDGED REVENUES
7.01. SUPERIORITY OF THE PLEDGE TO THE DEPARTMENT.
7.02. ADDITIONAL DEBT OBLIGATIONS.
ARTICLE VIII - GENERAL PROVISIONS
8.01. DISCHARGE OF OBLIGATIONS.
1
1
3
3
3
5
5
8
8
8
9
9
9
9
9
9
9
9
10
10
10
11
11
11
11
11
11
11
11
12
12
12
13
13
13
14
14
14
CLEAN WATER STATE REVOLVING FUND CONSTRUCTION LOAN AGREEMENT
CONTENTS
PAGE
8.02. PROJECT RECORDS AND STATEMENTS.
8.03. ACCESS TO PROJECT SITE.
8.04. ASSIGNMENT OF RIGHTS UNDER AGREEMENT.
8.05. AMENDMENT OF AGREEMENT.
8.06. ANNULMENT OF AGREEMENT.
8.07. SEVERABILITY CLAUSE.
ARTICLE IX - CONSTRUCTION CONTRACTS AND INSURANCE
9.01. AUTHORIZATION TO AWARD CONSTRUCTION CONTRACTS.
9.02. SUBMITIAL OF CONSTRUCTION CONTRACT DOCUMENTS.
9.03. INSURANCE REQUIRED.
ARTICLE X - DETAILS OF FINANCING
10.01. PRINCIPAL AMOUNT OF LOAN.
10.02. LOAN SERVICE FEE.
10.03. FINANCING RATE.
10.04. LOAN TERM.
10.05. REPAYMENT SCHEDULE.
10.06. PROJECT COSTS.
10.07. SCHEDULE.
10.08. SPECIAL CONDITION.
ARTICLE XI - EXECUTION OF AGREEMENT
ii
14
15
15
15
15
15
15
15
16
16
16
16
17
17
17
17
18
18
19
20
CLEAN WATER STATE REVOLVING FUND CONSTRUCTION LOAN AGREEMENT
WW602091
THIS AGREEMENT is executed by the STATE OF FLORIDA DEPARTMENT OF
ENVIRONMENTAL PROTECTION (Department) and MONROE COUNTY, FLORIDA, (Local
Government) existing as a local governmental agency under the laws of the State of Florida.
WITNESSETH:
WHEREAS, pursuant to Section 403.1835, Florida Statutes, the Department is authorized to
make loans to local government agencies to finance or refinance the construction of wastewater
pollution control facilities, the planning and design of which have been reviewed by the
Department; and
WHEREAS, the Local Government has made application for the financing of the Project, and
the Department has determined that such Project meets all requirements for a loan.
WHEREAS, the Florida Water Pollution Control Financing Corporation and the Local Government
entered into Clean Water State Revolving Fund Loan Agreement WW602090; and
WHEREAS, the Department has requested that the Local Government enter into Clean Water
State Revolving Fund Construction Loan Agreement WW602091; and
WHEREAS, Agreement WW602091 replaces and supersedes Agreement WW602090.
NOW, THEREFORE, in consideration of the Department loaning money to the Local
Government, in the principal amount and pursuant to the covenants hereinafter set forth, it is
agreed as follows:
ARTICLE I - DEFINITIONS
1.01. WORDS AND TERMS.
Words and terms used herein shall have the meanings set forth below:
(1) "Agreement" or "Loan Agreement" shall mean this construction loan agreement.
(2) "Authorized Representative" shall mean the official of the Local Government
authorized by ordinance or resolution to sign documents associated with the Loan.
(3) "Capitalized Interest" shall mean a finance charge that accrues at the Financing Rate
on Loan proceeds from the time of disbursement until six months before the first Semiannual
Loan Payment is due. Capitalized Interest is financed as part of the Loan principal.
(4) "Depository" shall mean a bank or trust company, having a combined capital and
unimpaired surplus of not less than $50 million, authorized to transact commercial banking or
savings and loan business in the State of Florida and insured by the Federal Deposit Insurance
Corporation.
(5) "Financing Rate" shall mean the charges, expressed as a percent per annum,
imposed on the unpaid principal of the Loan. The Fi'lancing Rate shall consist of an interest
rate component and a Grant Allocation Assessment rate component.
1
(6) "Grant Allocation Assessment" shall mean an assessment, expressed as a percent
per annum, accruing on the unpaid balance of the Loan. It is computed similarly to the way
interest charged on the Loan is computed and is included in the Semiannual Loan Payment.
The Department will use Grant Allocation Assessment moneys for making grants to financially
disadvantaged small communities pursuant to Section 403.1835 of the Florida Statutes.
(7) "Loan" shall mean the amount of money to be loaned pursuant to this Agreement
and subsequent amendments.
(8) "Loan Application" shall mean the completed form which provides all information
required to support obtaining construction loan financial assistance.
(9) "Loan Debt Service Account" shall mean an account, or a separately identified
component of a pooled cash or liquid account, with a Depository established by the Local
Government for the purpose of accumulating Monthly Loan Deposits and making Semiannual
Loan Payments.
(10) "Loan Service Fee" shall mean an origination fee which shall be paid to the
Department by the Local Government.
(11) "Monthly Loan Deposit" shall mean the monthly deposit to be made by the Local
Government to the Loan Debt Service Account.
(12) "Non-ad Valorem Revenues" shall mean revenues collected on an annual basis in
accordance with the rules and regulations of the Florida Department of Revenue and the
Florida Statutes which shall benefit the Local Borrower's General Fund; the Law Enforcement,
Jail and Judicial Fund; the Unincorporated Parks and Beaches Fund; and the Planning, Building,
Code and Fire Marshal Fund.
(13) "Pledged Revenues" shall mean the specific revenues pledged as security for
repayment of the Loan and shall be the Non-ad Valorem Revenues derived yearly after the
satisfaction of all yearly payment obligations on account of any senior obligations issued
pursuant to Section 7.02 of this Agreement.
(14) "Project" shall mean the works financed by this Loan and shall consist of furnishing
all labor, materials, and equipment to construct the collection, transmission and treatment
facilities in accordance with the plans and specifications accepted by the Department for the
following contracts:
(a) "Rockland Key and Geiger Key Collection System"
(b) "Big Coppitt Wastewater Treatment Plant"
The Project is in agreement with the planning documentation accepted by the
Department effective November 20, 2007. A Florida Finding of No Significant Impact was
published on November 16, 2007 and no adverse comments were received.
(15) "Semiannual Loan Payment" shall mean the payment due from the Local
Government to the Department at six-month intervals.
2
(16) "Sewer System" shall mean all facilities owned by the Local Government for
collection, transmission, treatment and reuse of wastewater and its residuals.
1.02. CORRELATIVE WORDS.
Words of the masculine gender shall be understood to include correlative words of the
feminine and neuter genders. Unless the context shall otherwise indicate, the singular shall
include the plural and the word "person" shall include corporations and associations, including
public bodies, as well as natural persons.
ARTICLE II - WARRANTIES, REPRESENTATIONS AND COVENANTS
2.01. WARRANTIES, REPRESENTATIONS AND COVENANTS.
The Local Government warrants, represents and covenants that:
(1) The Local Government has full power and authority to enter into this Agreement
and to comply with the provisions hereof.
(2) The Local Government currently is not the subject of bankruptcy, insolvency, or
reorganization proceedings and is not in default of, or otherwise subject to, any agreement or
any law, administrative regulation, judgment, decree, note, resolution, charter or ordinance
which would currently restrain or enjoin it from entering into, or complying with, this
Agreement.
(3) There is no material action, suit, proceeding, inquiry or investigation, at law or in
equity, before any court or public body, pending or, to the best of the Local Government's
knowledge, threatened, which seeks to restrain or enjoin the Local Government from entering
into or complying with this Agreement.
(4) All permits, real property interests, and approvals required as of the date of this
Agreement have been obtained for construction and use of the Project. The Local Government
knows of no reason why any future required permits or approvals are not obtainable.
(5) The Local Government shall undertake the Project on its own responsibility, to the
extent permitted by law.
(6) To the extent permitted by law, the Local Government shall release and hold
harmless the State, its officers, members, and employees from any claim arising in connection
with the Local Government's actions or omissions in its planning, engineering, administrative,
and construction activities financed by this Loan or its operation of the Project.
(7) All Local Government representations to the Department, pursuant to the Loan
Application and Agreement, were true and accurate as of the date such representations were
made. The financial information delivered by the Local Government to the Department was
current and correct as of the date such information was delivered. The Local Government shall
comply with Chapter 62-503, Florida Administrative Code, and all applicable State and Federal
laws, rules, and regulations which are identified in the Loan Application or Agreement. To the
3
extent that any assurance, representation, or covenant requires a future action, the Local
Government shall take such action as is necessary for compliance.
(8) The Local Government shall maintain records using generally accepted accounting
principles established by the Governmental Accounting Standards Board. As part of its
bookkeeping system, the Local Government shall keep accounts of the Sewer System separate
from all other accounts and it shall keep accurate records of all revenues, expenses, and
expenditures relating to the Sewer System, and of the Pledged Revenues, Loan disbursement
receipts, and Loan Debt Service Account.
(9) In the event the anticipated Pledged Revenues are shown by the Local
Government's annual budget to be insufficient to make the Semiannual Loan Payments for such
Fiscal Year when due, the Local Government shall include in such budget other legally
available non-ad valorem funds which will be sufficient, together with the Pledged Revenues,
to make the Semiannual Loan Payments. Such other legally available non-ad valorem funds
shall be budgeted in the regular annual governmental budget and designated for the purpose
provided by this Subsection, and the Local Government shall collect such funds for application
as provided herein. The Local Government shall notify the Department immediately in writing
of any such budgeting of other legally available non-ad valorem funds. Nothing in this
covenant shall be construed as creating a pledge, lien, or charge upon any such other legally
available non-ad valorem funds; requiring the Local Government to levy or appropriate ad
valorem tax revenues; or preventing the Local Government from pledging to the payment of
any bonds or other obligations all or any part of such other legally available non-ad valorem
funds.
(10) Each year, beginning three months before the first Semiannual Loan Payment and
ending with the year during which the final Loan repayment is made, the Local Government's
Authorized Representative or its chief financial officer shall submit, pursuant to the schedule
established in Section 10.07, a certification that: (a) Pledged Revenue collections satisfy, on a pro
rata basis, the rate coverage requirement; (b) the Loan Debt Service Account contains the funds
required; and (c) insurance, including that issued through the National Flood Insurance
Program authorized under 42 U.S.C. secs. 4001-4128 when applicable, in effect for the facilities
generating the Pledged Revenues, adequately covers the customary risks to the extent that such
insurance is available.
(11) Pursuant to Section 216.347 of the Florida Statutes, the Local Government shall not
use the Loan proceeds for the purpose of lobbying the Florida Legislature, the Judicial Branch,
or a State agency.
(12) The Local Government agrees to construct the Project in accordance with the Project
schedule. Delays incident to strikes, riots, acts of God, and other events beyond the reasonable
control of the Local Government are excepted. If for any reason construction is not completed
as scheduled, there shall be no resulting diminution or delay in the Semiannual Loan Payment
or the Monthly Loan Deposit.
(13) The Local Government covenants that this Agreement is entered into for the
purpose of constructing, refunding, or refinancing the Project which will in all events serve a
4
public purpose. The Local Government covenants that it will, under all conditions, complete
and operate the Project to fulfill the public need.
2.02. LEGAL AUTHORIZATION.
Upon signing this Agreement, the Local Government's legal counsel hereby expresses
the opinion, subject to laws affecting the rights of creditors generally, that:
(1) This Agreement has been duly authorized by the Local Government and shall
constitute a valid and legal obligation of the Local Government enforceable in accordance with
its terms upon execution by both parties; and
(2) This Agreement specifies the revenues pledged for repayment of the Loan, and the
pledge is valid and enforceable.
2.03. AUDIT AND MONITORING REQUIREMENTS.
The Local Government agrees to the following audit and monitoring requirements.
(1) The financial assistance authorized pursuant to this Loan Agreement consists of the
following:
Federal Resources, Including State Match, Awarded to the Recipient Pursuant to this Agreement Consist
of the FollowinJ~:
Federal State
Program Federal CFDA Funding Appropriation
Number A~ency Number CFDA Title Amount Category
CS120001-090 EPA 66.458 Capitalization Grants $20,000,000 140131
for State Revolving
Funds
(2) Audits.
(a) In the event that the Local Government expends $500,000 or more in Federal awards
in its fiscal year, the Local Government must have a single or program-specific audit conducted
in accordance with the provisions of OMB Circular A-133, as revised. Subsection 2.03(1) of this
Agreement indicates that Federal funds are awarded through the Department by this
Agreement. In determining the Federal awards expended in its fiscal year, the Local
Government shall consider all sources of Federal awards, including Federal resources received
from the Department of Environmental Protection. The determination of amounts of Federal
awards expended should be in accordance with the guidelines established by OMB Circular A-
133, as revised. An audit of the Local Government conducted by the Auditor General in
accordance with the provisions of OMB Circular A-133, as revised, will meet the requirements
of this part.
(b) In connection with the audit requirements addressed in the preceding paragraph (a),
the Local Government shall fulfill the requirements relative to auditee responsibilities as
provided in Subpart C of OMB Circular A-133, as revised.
5
(c) If the Local Government expends less than $500,000 in Federal awards in its fiscal
year, an audit conducted in accordance with the provisions of OMB Circular A-133, as revised,
is not required. The Local Government shall inform the Department of findings and
recommendations pertaining to the State Revolving Fund in audits conducted by the Local
Government in which the $500,000 threshold has not been met. In the event that the Local
Government expends less than $500,000 in Federal awards in its fiscal year and elects to have an
audit conducted in accordance with the provisions of OMB Circular A-133, as revised, the cost
of the audit must be paid from non-Federal resources (i.e., the cost of such an audit must be
paid from Local Government resources obtained from other than Federal entities).
(d) The Local Government may access information regarding the Catalog of Federal
Domestic Assistance (CFDA) via the internet at www.cfda.gov / index?cck=l&au=&ck=.
(3) Report Submission.
(a) Copies of reporting packages for audits conducted in accordance with OMB Circular
A-133, as revised, and required by Subsection 2.03(2) of this Agreement shall be submitted,
when required by Section .320 (d), OMB Circular A-133, as revised, by or on behalf of the Local
Government directly to each of the following:
(i) The Department at the following address:
Joe Aita, Audit Director
Office of the Inspector General
Florida Department of Environmental Protection
3900 Commonwealth Boulevard, MS 41
Tallahassee, Florida 32399-3123
(ii) The Federal Audit Clearinghouse designated in OMB Circular A-133, as revised
(the number of co'pies required by Sections .320 (d)(l) and (2), OMB Circular A-133,
as revised, should be submitted to the Federal Audit Clearinghouse), at the
following address:
Federal Audit Clearinghouse
Bureau of the Census
1201 East 10th Street
Jeffersonville, IN 47132
Submissions of the Single Audit reporting package for fiscal periods ending on or
after January I, 2008, must be submitted using the Federal Clearinghouse's Internet
Data Entry System which can be found at http://harvester.census.gov /fac/
(iii) Other Federal agencies and pass-through entities in accordance with Sections
.320(e) and (f), OMB Circular A-133, as revised.
(b) Pursuant to Section .320(f), OMB Circular A-133, as revised, the Local Government
shall submit a copy of the reporting package described in Section .320(c), OMB Circular A-133,
as revised, and any management letters issued by the auditor, to the Department at the address
listed under Subsection 2.03(3)(a) of this Agreement.
6
(c) Any reports, management letters, or other information required to be submitted to
the Department pursuant to this Agreement shall be submitted timely in accordance with OMB
Circular A-133, Florida Statutes, or Chapters 10.550 (local governmental entities) or 10.650
(nonprofit and for-profit organizations), Rules of the Auditor General, as applicable.
(d) Local Governments, when submitting financial reporting packages to the
Department for audits done in accordance with OMB Circular A-133, or Chapters 10.550 (local
governmental entities) or 10.650 (nonprofit and for-profit organizations), Rules of the Auditor
General, should indicate the date that the reporting package was delivered to the Local
Government in correspondence accompanying the reporting package.
(4) Project-Specific Audit.
Within 12 months after the amendment establishing final Project costs, the Local
Government shall submit to the Department a Project-specific audit report for the Loan related
revenues and expenditures. The audit shall address Loan disbursements received, Project
expenditures, and compliance with Loan Agreement covenants. The Local Government shall
cause the auditor to notify the Department immediately if anything comes to the auditor's
attention during the examination of records that would constitute a default under the Loan
Agreement. The audit findings shall set aside or question any costs that are unallowable under
Chapter 62-503, Florida Administrative Code. A final determination of whether such costs are
allowed shall be made by the Department.
(5) Record Retention.
The Local Government shall retain sufficient records demonstrating its compliance with
the terms of this Agreement for a period of five years from the date the audit report is issued,
and shall allow the Department, or its designee, Chief Financial Officer, or Auditor General
access to such records upon request. The Local Government shall ensure that audit working
papers are made available to the Department, or its designee, Chief Financial Officer, or Auditor
General upon request for a period of five years from the date the audit report is issued, unless
extended in writing by the Department.
The Local Government is hereby advised that the Federal and/ or Florida Single Audit
Act Requirements may further apply to lower tier transactions that may be a result of this
Agreement. For federal financial assistance, the Local Government shall utilize the guidance
provided under OMB Circular A-133, Subpart B, Section _.210 for determining whether the
relationship represents that of a subrecipient or vendor.
The Local Government should confer with its chief financial officer, audit director or
contact the Department for assistance with questions pertaining to the applicability of these
requirements.
In addition, the Local Government agrees to complete and submit the Certification of
Applicability to Single Audit Act Reporting, Attachment A, attached hereto and made a part
hereof, within four (4) months following the end of the Local Government's fiscal year.
Attachment A should be submitted to the Department's Grants Development and Review
Manager at 3900 Commonwealth Boulevard, Mail Station 93, Tallahassee, Florida 32399-3000.
7
The Grants Development and Review Manager is available to answer any questions at
(850) 245-2361.
(6) Monitoring.
In addition to reviews of audits conducted in accordance with OMB Circular A-133, as
revised (see audit requirements above), monitoring procedures may include, but not be limited
to, on-site visits by Department staff, limited scope audits as defined by OMB Circular A-133, as
revised, and/ or other procedures. By entering into this Agreement, the Local Government
agrees to comply and cooperate with any monitoring procedures/processes deemed
appropriate by the Department. In the event the Department determines that a limited scope
audit of the Local Government is appropriate, the Local Government agrees to comply with any
additional instructions provided by the Department to the Local Government regarding such
audit. The Local Government further agrees to comply and cooperate with any inspections,
reviews, investigations, or audits deemed necessary by the Chief Financial Officer or Auditor
General.
ARTICLE III - LOAN REPAYMENT ACCOUNT
3.01. LOAN DEBT SERVICE ACCOUNT.
The Local Government shall establish a Loan Debt Service Account with a Depository
and begin making Monthly Loan Deposits no later than the date set forth for such action in
Section 10.07 of this Agreement.
Beginning six months prior to each Semiannual Loan Payment, the Local Government
shall make six Monthly Loan Deposits. The first five deposits each shall be at least equal to one-
sixth of the Semiannual Loan Payment. The sixth Monthly Loan Deposit shall be at least 'equal
to the amount required to make the total on deposit in the Loan Debt Service Account equal to
the Semiannual Loan Payment amount, taking into consideration investment earnings credited
to the account pursuant to Section 3.02.
Any month in which the Local Government fails to make a required Monthly Loan
Deposit, the Local Government's chief financial officer shall notify the Department of such
failure. In addition, the Local Government agrees to budget, by amendment if necessary,
payment to the Department from other legally available non-ad valorem funds all sums
becoming due before the same become delinquent. This requirement shall not be construed to
give superiority to the Department's claim on any revenues over prior claims of general
creditors of the Local Government, nor shall it be construed to give the Department the power
to require the Local Government to levy and collect any revenues other than Pledged Revenues.
3.02. INVESTMENT OF LOAN DEBT SERVICE ACCOUNT MONEYS.
Moneys on deposit in the Loan Debt Service Account shall be invested pursuant to the
laws of the State of Florida. Such moneys may be pooled for investment purposes. The
maturity or redemption date of investments shall be not later than the date upon which such
moneys may be needed to make Semiannual Loan Payments. The investment earnings shall be
8
credited to the Loan Debt Service Account and applied toward the Monthly Loan Deposit
requirements.
3.03. LOAN DEBT SERVICE ACCOUNT WITHDRAWALS.
The withdrawal of moneys from the Loan Debt Service Account shall be for the sole
purpose of making the Semiannual Loan Payment or for discharging the Local Government's
obligations pursuant to Section 8.01.
3.04. ASSETS HELD IN TRUST.
The assets in all accounts created under this Loan Agreement shall be held in trust for
the purposes provided herein and used only for the purposes and in the manner prescribed in
this Agreement; and, pending such use, said assets shall be subject to a lien and charge in favor
of the Department.
ARTICLE IV - PROJECT INFORMATION
4.01. PROJECT CHANGES.
Project changes prior to bid opening shall be made by addendum to plans and
specifications. Changes after bid opening shall be made by change order. The Local
Government shall submit all addenda and all change orders to the Department for an eligibility
determination. After execution of all construction, equipment and materials contracts, the
Project contingency may be reduced.
4.02. TITLE TO PROJECT SITE.
The Local Government shall have an interest in real property sufficient for the
construction and location of the Project free and clear of liens and encumbrances which would
impair the usefulness of such sites for the intended use.
4.03. PERMITS AND APPROVALS.
The Local Government shall have obtained, prior to the Department's authorization to
award construction contracts, all permits and approvals required for construction of the Project
or portion of the Project funded under this Agreement.
4.04. ENGINEERING SERVICES.
A professional engineer, registered in the State of Florida, shall be employed by, or
under contract with, the Local Government to oversee construction.
4.05. PROHIBITION AGAINST ENCUMBRANCES.
The Local Government is prohibited from selling, leasing, or disposing of any part of the
Sewer System which would materially reduce operational integrity or Gross Revenues so long
9
as this Agreement, including any amendment thereto, is in effect unless the written consent of
the Department is first secured.
4.06. COMPLETION MONEYS.
In addition to the proceeds of this Loan, the Local Government covenants that it has
obtained, or will obtain, sufficient moneys from other sources to complete construction and
place the Project in operation on, or prior to, the date specified in Article X. Failure of the
Department to approve additional financing shall not constitute a waiver of the Local
Government's covenants to complete and place the Project in operation.
4.07. CLOSE-OUT.
The Department shall conduct a final inspection of the Project and Project records.
Following the inspection, deadlines for submitting additional disbursement requests, if any,
shall be established, along with deadlines for uncompleted Loan requirements, if any.
Deadlines shall be incorporated into the Loan Agreement by amendment. The Loan principal
shall be reduced by any excess over the amount required to pay all approved costs. As a result
of such adjustment, the Semiannual Loan Payment shall be reduced accordingly, as addressed
in Section 10.05.
4.08. LOAN DISBURSEMENTS.
Disbursements shall be made only by the State Chief Financial Officer and only when
the requests for such disbursements are accompanied by a Department certification that such
withdrawals are proper expenditures. Disbursements shall be made directly to the Local
Government for allowance costs and reimbursement of the incurred construction costs and
related services. Disbursement of the allowance costs shall be made upon the Department's
receipt of a disbursement request form. Up to seventy percent of the estimated allowance shall
be disbursed after the Loan Agreement is signed. The remainder of the allowance shall be
disbursed after all procurement contracts are executed and shall be adjusted to reflect as-bid
costs. The entire estimated allowance may be disbursed after the Loan Agreement is signed if
the local government agrees to an allowance adjustment after all contracts have been bid.
Disbursements for materials, labor, or services shall be made upon receipt of the following:
(1) A completed disbursement request form signed by the Authorized Representative.
Such requests must be accompanied by sufficiently itemized summaries of the materials, labor,
or services to identify the nature of the work performed; the cost or charges for such work; and
the person providing the service or performing the work.
(2) A certification signed by the Authorized Representative as to the current estimated
costs of the Project; that the materials, labor, or services represented by the invoice have been
satisfactorily purchased, performed, or received and applied to the project; that all funds
received to date have been applied toward completing the Project; and that under the terms and
provisions of the contracts, the Local Government is required to make such payments.
(3) A certification by the engineer responsible for overseeing construction stating that
equipment, materials, labor and services represented by the construction invoices have been
satisfactorily purchased, or received, and applied to the Project in accordance with construction
10
contract documents; stating that payment is in accordance with construction contract
provisions; stating that construction, up to the point of the requisition, is in compliance with the
contract documents; and identifying all additions or deletions to the Project which have altered
the Project's performance standards, scope, or purpose since the issue of the Department
construction permit.
(4) Such other certificates or documents by engineers, attorneys, accountants,
contractors, or suppliers as may reasonably be required by the Department.
ARTICLE V - RATES AND USE OF THE SEWER SYSTEM
5.01. RESERVED
5.02. NO FREE SERVICE.
The Local Government shall not permit connections to, or furnish any services afforded
by, the Sewer System without making a charge therefor based on the Local Government's
uniform schedule of rates, fees, and charges.
5.03. MANDATORY CONNECTIONS.
The Local Government shall adopt, as necessary, and enforce requirements, consistent
with applicable laws, for the owner, tenant or occupant of each building located on a lot or
parcel of land which is served, or may reasonably be served, by the Sewer System to connect
such building to the Sewer System.
5.04. RESERVED.
5.05. MAINTENANCE OF THE SEWER SYSTEM.
The Local Government shall operate and maintain the Sewer System in a proper, sound
and economical manner and shall make all necessary repairs, renewals and replacements.
5.06. ADDITIONS AND MODIFICATIONS.
The Local Government may make any additions, modifications or improvements to the
Sewer System which it deems desirable and which do not materially reduce the operational
integrity of any part of the Sewer System. All such renewals, replacements, additions,
modifications and improvements shall become part of the Sewer System.
5.07. COLLECTION OF REVENUES.
The Local Government shall use its best efforts to collect all rates, fees and other charges
due to it. The Local Government shall establish liens on premises served by the Sewer System
for the amount of all delinquent rates, fees and other charges where such action is permitted by
law. The Local Government shall, to the full extent permitted by law, cause to discontinue the
services of the Sewer System and use its best efforts to shut off water service furnished to
11
persons who are delinquent beyond customary grace periods in the payment of Water and
Sewer System rates, fees and other charges.
ARTICLE VI - DEF AUL TS AND REMEDIES
6.01. EVENTS OF DEFAULT.
Each of the following events is hereby declared an event of default:
(1) Failure to make any Monthly Loan Deposit or to make any installment of the
Semiannual Loan Payment when it is due and such failure shall continue for a period of 30
days.
(2) Except as provided in Subsections 6.01(1) and 6.01(7), failure to comply with the
provisions of this Agreement or failure in the performance or observance of any of the
covenants or actions required by this Agreement and such failure shall continue for a period of
60 days after written notice thereof to the Local Government by the Department.
(3) Any warranty, representation or other statement by, or on behalf of, the Local
Government contained in this Agreement or in any information furnished in compliance with,
or in reference to, this Agreement, which is false or misleading.
(4) An order or decree entered, with the acquiescence of the Local Government,
appointing a receiver of any part of the Sewer System or Gross Revenues thereof; or if such
order or decree, having been entered without the consent or acquiescence of the Local
Government, shall not be vacated or discharged or stayed on appeal within 60 days after the
entry thereof.
(5) Any proceeding instituted, with the acquiescence of the Local Government, for the
purpose of effecting a composition between the Local Government and its creditors or for the
purpose of adjusting the claims of such creditors, pursuant to any federal or state statute now or
hereafter enacted, if the claims of such creditors are payable from Gross Revenues of the Sewer
System.
(6) Any bankruptcy, insolvency or other similar proceeding instituted by, or against,
the Local Government under federal or state bankruptcy or insolvency law now or hereafter in
effect and, if instituted against the Local Government, is not dismissed within 60 days after
filing.
(7) Failure of the Local Government to give immediate written notice of default to the
Department and such failure shall continue for a period of 30 days.
6.02. REMEDIES.
Upon any event of default and subject to the rights of others having prior liens on the
Pledged Revenues, the Department may enforce its rights by any of the following remedies:
12
(1) By mandamus or other proceeding at law or in equity, cause to establish rates and
collect fees and charges for use of the Sewer System, and to require the Local Government to
fulfill this Agreement.
(2) By action or suit in equity, require the Local Government to account for all moneys
received from the Department or from the ownership of the Sewer System and to account for
the receipt, use, application, or disposition of the Pledged Revenues.
(3) By action or suit in equity, enjoin any acts or things which may be unlawful or in
violation of the rights of the Department.
(4) By applying to a court of competent jurisdiction, cause to appoint a receiver to
manage the Sewer System, establish and collect fees and charges, and apply the revenues to the
reduction of the obligations under this Agreement.
(5) By certifying to the Auditor General and the Chief Financial Officer delinquency on
loan repayments, the Department may intercept the delinquent amount plus a penalty from any
unobligated funds due to the Local Government under any revenue or tax sharing fund
established by the State, except as otherwise provided by the State Constitution. The
Department may impose a penalty in an amount not to exceed an interest rate of 18 percent per
annum on the amount due in addition to charging the cost to handle and process the debt.
Penalty interest shall accrue on any amount due and payable beginning on the 30th day
following the date upon which payment is due.
(6) By notifying financial market credit rating agencies and potential creditors.
(7) By suing for payment of amounts due, or becoming due, with interest on overdue
payments together with all costs of collection, including attorneys' fees.
(8) By accelerating the repayment schedule or increasing the Financing Rate on the
unpaid principal of the Loan to as much as 1.667 times the Financing Rate for a default under
Subsection 6.01(1).
6.03. DELAY AND WAIVER.
No delay or omission by the Department to exercise any right or power accruing upon
event of default shall impair any such right or power or shall be construed to be a waiver of any
such default or acquiescence therein, and every such right and power may be exercised as often
as may be deemed expedient. No waiver or any default under this Agreement shall extend to
or affect any subsequent event of default, whether of the same or different provision of this
Agreement, or shall impair consequent rights or remedies.
ARTICLE VII - THE PLEDGED REVENUES
7.01. SUPERIORITY OF THE PLEDGE TO THE DEPARTMENT.
From and after the effective date of this Agreement, the Department shall have a lien on
the Pledged Revenues, which along with any other Department State Revolving Fund liens on
13
the Pledged Revenues, will be prior and superior to any other lien, pledge or assignment with
the following exception. All obligations of the Local Government under this Agreement shall
be junior, inferior, and subordinate in all respects in right of payment and security to any
additional senior obligations issued with the Department's consent pursuant to Section 7.02.
Any of the Pledged Revenues may be released from the lien on such Pledged Revenues in favor
of the Department if the Department makes a determination, based upon facts deemed
sufficient by the Department, that the remaining Pledged Revenues will, in each Fiscal Year,
equal or exceed 1.20 times the debt service coming due in each Fiscal Year under the terms of
this Agreement.
7.02. ADDITIONAL DEBT OBLIGATIONS.
The Local Government may issue additional debt obligations on a parity with, or senior
to, the lien of the Department on the Pledged Revenues provided the Department's written
consent is obtained. Such consent shall be granted if the Local Government demonstrates at the
time of such issuance that the Pledged Revenues, which may take into account reasonable
projections of growth of the Sewer System and revenue increases, plus revenues to be pledged
to the additional proposed debt obligations will, during the period of time Semiannual Loan
Payments are to be made under this Agreement, equal or exceed 1.20 times the annual
combined debt service requirements of this Agreement and the obligations proposed to be
issued by the Local Government and will satisfy the coverage requirements of all other debt
obligations secured by the Pledged Revenues.
ARTICLE VIII - GENERAL PROVISIONS
8.01. DISCHARGE OF OBLIGATIONS.
All payments required to be made under this Agreement shall be cumulative and any
deficiencies in any Fiscal Year shall be added to the payments due in the succeeding year and
all years thereafter until fully paid. Payments shall continue to be secured by this Agreement
until all of the payments required shall be fully paid to the Department. If at any time the Local
Government shall have paid, or shall have made provision for the timely payment of, the entire
principal amount of the Loan, and as applicable, Loan Service Fee, interest, and Grant
Allocation Assessment charges, the pledge of, and lien on, the Pledged Revenues to the
Department shall be no longer in effect. Deposit of sufficient cash, securities, or investments,
authorized by law, from time to time, may be made to effect defeasance of this Loan. However,
the deposit shall be made in irrevocable trust with a banking institution or trust company for
the sole benefit of the Department. There shall be no penalty imposed by the Department for
early retirement of this Loan.
8.02. PROJECT RECORDS AND STATEMENTS.
Books, records, reports, engineering documents, contract documents, and papers shall
be available to the authorized representatives of the Department and the u.s. Environmental
Protection Agency's Inspector General for inspection at any reasonable time after the Local
Government has received a disbursement and until five years after the date that the Project-
specific audit report, required under Subsection 2.03(4), is issued.
14
8.03. ACCESS TO PROJECT SITE.
The Local Government shall provide access to Project sites and administrative offices to
authorized representatives of the Department at any reasonable time. The Local Government
shall cause its engineers and contractors to cooperate during Project inspections, including
making available working copies of plans and specifications and supplementary materials.
8.04. ASSIGNMENT OF RIGHTS UNDER AGREEMENT.
The Department may assign any part of its rights under this Agreement after
notification to the Local Government. The Local Government shall not assign rights created by
this Agreement without the written consent of the Department.
8.05. AMENDMENT OF AGREEMENT.
This Agreement may be amended in writing, except that no amendment shall be
permitted which is inconsistent with statutes, rules, regulations, executive orders, or written
agreements between the Department and the U.S. Environmental Protection Agency. This
Agreement may be amended after all construction contracts are executed to re-establish the
Project cost, Loan amount, Project schedule, and Semiannual Loan Payment amount. A final
amendment establishing the final Project costs and the Loan Service Fee based on actual Project
costs shall be completed after the Department's final inspection of the Project records.
8.06. ANNULMENT OF AGREEMJjNT.
The Department may unilaterally annul this Agreement if the Local Government has not
drawn any of the Loan proceeds within twelve months after the effective date of this
Agreement. If the Department unilaterally annuls this Agreement, the Department will provide
written notification to the Local Government.
8.07. SEVERABILITY CLAUSE.
If any provision of this Agreement shall be held invalid or unenforceable, the remaining
provisions shall be construed and enforced as if such invalid or unenforceable provision had
not been contained herein.
ARTICLE IX - CONSTRUCTION CONTRACTS AND INSURANCE
9.01. AUTHORIZATION TO AWARD CONSTRUCTION CONTRACTS.
The following documentation is required to receive the Department's authorization to
award construction contracts:
(1) Proof of advertising.
(2) Award recommendation, bid proposal, and bid tabulation (certified by the
responsible engineer).
15
(3) Certification of compliance with the conditions of the Department's approval of
competitively or non-competitively negotiated procurement, if applicable.
9.02. SUBMITTAL OF CONSTRUCTION CONTRACT DOCUMENTS.
After the Department's authorization to award construction contracts has been received,
the Local Government shall submit:
(1) Contractor insurance certifications.
(2) Certified copy of the Local Government's award resolution.
(3) Notices to proceed with construction.
9.03. INSURANCE REQUIRED.
The Local Government shall cause the Project, as each part thereof is certified by the
engineer responsible for overseeing construction as completed, and the Sewer System (hereafter
referred to as "Revenue Producing Facilities") to be insured by an insurance company or
companies licensed to do business in the State of Florida against such damage and destruction
risks as are customary for the operation of Revenue Producing Facilities of like size, type and
location to the extent such insurance is obtainable from time to time against anyone or more of
such risks.
The proceeds of insurance policies received as a result of damage to, or destruction of,
the Project or the other Revenue Producing Facilities, shall be used to restore or replace
damaged portions of the facilities. If such proceeds are insufficient, the Local Government shall
provide additional funds to restore or replace the damaged portions of the facilities. Repair,
construction or replacement shall be promptly completed.
ARTICLE X - DETAILS OF FINANCING
10.01. PRINCIPAL AMOUNT OF LOAN.
The estimated principal amount of the Loan is $20,134,400, which consists of $20,000,000
to be disbursed to the Local Government and $134,400 of Capitalized Interest.
Capitalized Interest is not disbursed to the Local Government, but is amortized via
periodic Loan repayments to the Department as if it were actually disbursed. Capitalized
Interest is computed at the Financing Rate, or rates, set for the Loan. It accrues and is
compounded annually from the time when disbursements are made until six months before the
first Semiannual Loan Payment is due. Capitalized Interest is estimated prior to establishing
the schedule of actual disbursements.
This project is a Segmented Project. Additional State Revolving Fund financing for the
Project is dependent upon the availability of additional funds. The current funding limitations
and future funding priority entitlement for Segmented Projects are set forth in the Chapter
62-503 of the Florida Administrative Code.
16
10.02. LOAN SERVICE FEE.
The Loan Service Fee is estimated as $400,000 for the Loan amount authorized to date.
The fee represents two percent of the Loan amount excluding Capitalized Interest amount; that
is, two percent of $20,000,000. The Loan Service Fee is estimated at the time of execution of the
loan agreement and shall be revised with any increase or decrease amendment. The Loan
Service Fee is based on actual Project costs and assessed in the final loan amendment. The Local
Government shall pay the Loan Service Fee from the first available repayments following the
final amendment.
Capitalized Interest is computed on the assessed Loan Service Fee at the Financing Rate,
or rates and included in the final amendment. It accrues and is compounded annually from the
final amendment date until six months before the first Semiannual Loan Payment is due. A
service fee assessed in a final amendment occurring later than six months before the first
Semiannual Loan Payment date would not accrue Capitalized Interest charges.
10.03. FINANCING RATE.
The Financing Rate on the unpaid principal of the Loan amount specified in
Section 10.01 is 2.71 percent per annum. The Financing Rate equals the sum of the interest rate
and the Grant Allocation Assessment Rate. The interest rate is 1.355 percent per annum and the
Grant Allocation Assessment rate is 1.355 percent per annum. However, if this Agreement is
not executed by the Local Government and returned to the Department before July I, 2010, the
Financing Rate may be adjusted. A new Financing Rate shall be established for any funds
provided by amendment to this Agreement.
10.04. LOAN TERM.
The Loan shall be repaid in 40 Semiannual Loan Payments.
10.05. REPAYMENT SCHEDULE.
The Semiannual Loan Payment shall be computed based upon the principal amount of
the Loan plus the estimated Loan Service Fee and the principle of level debt service. The
Semiannual Loan Payment amount may be adjusted, by amendment of this Agreement, based
upon revised information. After the final disbursement of Loan proceeds, the Semiannual Loan
Payment shall be based upon the actual Project costs, the actual Loan Service Fee and Loan
Service Fee capitalized interest, if any, and actual dates and amounts of disbursements, taking
into consideration any previous payments. Actual Project costs shall be established after the
Department's inspection of the completed Project and associated records. The Department will
deduct the Loan Service Fee and any associated interest from the first available repayments
following the final amendment.
Each Semiannual Loan Payment shall be in the amount of $668,374 until the payment
amount is adjusted by amendment. The interest and Grant Allocation Assessment portions of
each Semiannual Loan Payment shall be computed, using their respective rates, on the unpaid
balance of the principal amount of the Loan, which includes Capitalized Interest. Interest (at
the Financing Rate) also shall be computed on the estimated Loan Service Fee. The interest and
17
Grant Allocation Assessment on the unpaid balance shall be computed as of the due date of
each Semiannual Loan Payment.
Semiannual Loan Payments shall be received by the Department beginning on
September 15, 2010 and semiannually thereafter on March 15 and September 15 of each year
until all amounts due hereunder have been fully paid. Funds transfer shall be made by
electronic means.
The Semiannual Loan Payment amount is based on the total amount owed of
$20,534,400, which consists of the Loan principal and the estimated Loan Service Fee.
10.06. PROJECT COSTS.
The Local Government and the Department acknowledge that the actual Project costs
have not been determined as of the effective date of this Agreement. Project cost adjustments
may be made as a result of mutually agreed upon Project changes. Capitalized Interest will be
recalculated based on actual dates and amounts of Loan disbursements. If the Local
Government receives other governmental financial assistance for this Project, the costs funded
by such other governmental assistance will not be financed by this Loan. The Department shall
establish the final Project costs after its final inspection of the Project records. Changes in
Project costs may also occur as a result of the Local Government's Project audit or a Department
audit. The Local Government agrees to the following estimates of Project costs:
PROJECT COSTS
CATEGORY
Allowance costs
Construction and Demolition
Contingencies
Technical Services After Bid Opening
SUBTOTAL (Disbursable Amount)
Capitalized Interest
TOTAL (Loan Principal Amount)
AUTHORIZED LOAN
COST($) AMOUNT($) TO DATE
1,565,972 Line items
19,005,012 may vary
950,251 based on Actual
1,300,000 Disbursements
22,821,235 20,000,000
134,400 134,400
22,955,635 20,134,400
10.07. SCHEDULE.
The Local Government agrees by execution hereof:
(1) Completion of Project construction is scheduled for March 15, 2010.
(2) The Loan Debt Service Account shall be established and Monthly Loan Deposits
shall begin no later than March 15, 2010.
(3) The initial annual certification required under Subsection 2.01(10) of this Agreement
shall be due June 15, 2010. Thereafter the certification shall be submitted no later than
September 30 of each year until the final Semiannual Loan Payment is made.
(4) The first Semiannual Loan Payment in the amount of $668,374 shall be due
September 15, 2010.
18
10.08. SPECIAL CONDITION.
Prior to the release of any funds, the Local Borrower shall submit a certified copy of a
Resolution which shall authorize the application, establish the Pledged Revenues and establish
an Authorized Representative for signing the application and executing the Loan agreement.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
19
ARTICLE XI - EXECUTION OF AGREEMENT
This Loan Agreement WW602091 shall be executed in three or more counterparts, any of
which shall be regarded as an original and all of which constitute but one and the same
instrument.
IN WITNESS WHEREOF, the Department has caused this Agreement to be executed on
its behalf by the Deputy Director and the Local Government has caused this Agreement to be
executed on its behalf by its Authorized Representative and by its affixed seal. The effective
date of this Agreement shall be as set forth below by the Deputy Director.
fviONR'OE COUNTY ATTORNEY
:
~7 ^ :\~~\lr= "
" I,~l'~, ", " ',' ~ j'..\. h U TT (
r".~: " ""~I ,"," GOt',""', i,'" ~,',' :-y
,. Z' ,.' '~ .. . ' "
~.::, .'~,ki 'Vd.:"~:~
I attest to the opinion expressed in Section
2.02, entitled Legal Authorization.
Attest
~aLJ(!.;~ J {J.L.
County Clerk - ..DAN'::; L.
SEAL
for
STATE OF FLORIDA
DEPARTMENT OF ENVIRONMENTAL PROTECTION
I!:. J-f L:--- APR J 2 2010
Deputy Director Date
Division of Water Resource Management
Attachment included as part of this Agreement:
Attachment A - Certification of Applicability to Single Audit Act Reporting
20
ATTACHMENT A
CERTIFICATION OF APPLICABILITY TO SINGLE AUDIT ACT REPORTING
Local Government's Name:
Local Government's Fiscal Year Period: FROM:
TO:
Total State Financial Assistance Expended during Local Government's most recently completed
Fiscal Year: $
Total Federal Financial Assistance Expended during Local Government's most recently
completed Fiscal Year: $
Please identify grants to be included in the Single Audit that are provided by the Department of
Environmental Protection
CSFA# CFDA# DEP LOAN AGREEMENT NUMBER
CERTIFICA nON STATEMENT:
I hereby certify that the above information is correct:
Name
Date
Title
DEP Project Agreement No. WW602091, Attachment A, Page 1 of I