RESOLUTION NO. RS2009-976

A resolution authorizing and providing for the financing of a drinking water system improvement project, including authorizing the execution of applications, contractual agreements, and other necessary documents in order to obtain a loan from the State of Tennessee for this purpose, and making certain representations regarding financing for loan repayment.

WHEREAS, the Metropolitan Government of Nashville and Davidson County (the Metropolitan Government) has determined that it is necessary and desirable to undertake certain activities or tasks in connection with a drinking water system improvement project, State of Tennessee, Department of Environment and Conservation, Number DGA-2009-101 (the “Project”), in and for the Metropolitan Government; and,

WHEREAS, the Project is identified by the Metropolitan Department of Water and Sewerage Services as Water Automatic Meter Read Project, CIB 09WS0014; and,

WHEREAS, Tennessee Code Annotated, Section 68-221-1201 et. seq., provide for the lending of moneys in the Drinking Water Revolving Loan Fund to local governments for the purpose of providing funds for local government drinking water system improvement projects like the Project and the Metropolitan Department of Water and Sewerage Services desires to apply for and enter into an Agreement (the Loan Agreement) with the State of Tennessee, Department of Environment and Conservation, to obtain such a loan for the implementation of the Project (the Project Loan); and,

WHEREAS, if the Project Loan is approved by the State of Tennessee, and subject to the contingencies provided for in the Loan Agreement, a portion of the ARRA funding for the Project Loan shall be forgiven by the State. The principal forgiven shall be 40% of the actual loan amount; and,

WHEREAS, the Project involves the replacement of existing non-automated water meters on the water service systems of customers of the Metropolitan Department of Water and Sewerage Services with new automated meters which will improve system efficiency; and,

WHEREAS, the Project is considered “green” in that its implementation will result in reduced vehicle emissions, reduced paperwork, a long-term reduction in the purchase and use of equipment, increased accuracy and thus less waste, and would overall have a smaller “carbon footprint” than the system would without the implementation of the Project; and,

WHEREAS, the replacement of the existing non-automated water meters with new automated meters was already planned by the Department of Water and Sewerage Service but the receipt of the Project Loan would enable a significant acceleration of this Project; and,

WHEREAS, Tennessee Code Annotated, Section 12-9-104(a) (2) (b) authorizes the Governing Bodies of Public Agencies, such as metropolitan governments, to approve agreements between that Public Agency and another Public Agency, such as the State of Tennessee, by resolution; and,

WHEREAS, the Metropolitan Government has determined that it is necessary and advisable to borrow funds from the State of Tennessee for the Project pursuant to these sections, and that it is to the benefit of the citizens of The Metropolitan Government of Nashville and Davidson County that an application in the substantial form of the attached and an agreement in the substantial form of the attached for the Project Loan be approved and that the Project Loan funds be obtained.

NOW THEREFORE, BE IT RESOLVED BY THE METROPOLITAN COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:

Section 1. That the Metropolitan Government of Nashville and Davidson County (the Metropolitan Government) hereby approves the creation of indebtedness on behalf of the Metropolitan Government, the principal amount of which is presently anticipated to be in the approximate amount of FOUR MILLION EIGHT HUNDRED THOUSAND DOLLARS ($4,800,000.00) but which in no event shall exceed EIGHT MILLION DOLLARS ($8,000,000.00) by the obtaining of a loan for a project identified by the State of Tennessee, Department of Environment and Conservation, as Project Number DGA-2009-101 (Metropolitan Department of Water and Sewerage Services CIB Number 09WS0014).

Section 2. That Karl Dean, the Mayor of the Metropolitan Government be authorized to execute and deliver the Application for a project Loan, in the substantial form of that which is attached hereto, the principal amount of which is presently anticipated to be in the approximate amount of FOUR MILLION EIGHT HUNDRED THOUSAND DOLLARS ($4,800,000.00) but which in no event shall exceed EIGHT MILLION DOLLARS ($8,000,000.00)for the purpose of funding all or a portion of the total estimated cost of the Project, EIGHT MILLION DOLLARS ($8,000,000.00), is hereby ratified and approved in all aspects.

Section 3. That the form, terms, and provisions of the agreement for the Project Loan among the Metropolitan Government of Nashville and Davidson County, the State of Tennessee, Department of Environment and Conservation, and the Tennessee Local Development Authority (the “Loan Agreement”), in the substantial form of that which is attached hereto, are hereby approved. It is acknowledged that the Project Loan includes funding from the American Recovery and Reinvestment Act (ARRA) and is subject to applicable requirements for such as will be provided in the Loan Agreement, including the requirement that, implementation must have begun or all project contracts must be signed by February 17, 2010. Failure to comply with this requirement shall result in the immediate termination of the loan agreement. All funds, which have been disbursed under this loan agreement, shall be repaid within ninety (90) days of receipt of the Notice of Termination of the loan from the Tennessee Local Development Authority and Tennessee Department of Environment and Conservation. Determination by the Authority and the Department of such failure shall be conclusive

Section 4. That the Metropolitan Government hereby agrees to honor and accept the method of financing as may be determined by the Tennessee Local Development Authority pursuant to the Loan Agreement.

Section 5. That the Metropolitan Government hereby agrees to make the monthly payments on the Project Loan in accordance with the Payment Schedule to be attached to the Loan Agreement.

Section 6. That the Metropolitan Government hereby agrees that the existing fees, rates and charges of the Department of Water and Sewerage Services will be sufficient to pay the interest on and principal of the Project Loan in accordance with the Loan Agreement. The Metropolitan Government also agrees that the existing fees, rates and charges of the Department of Water and Sewerage Services will be sufficient to pay the cost of operation and maintenance of the drinking water system improvements constituting the Project, which cost shall include depreciation and all other debt service expense of the system.

Section 7. That the Mayor of the Metropolitan Government is authorized and directed to execute a Loan Agreement in the substantial form of that which is attached hereto, and any amendments of or supplements to the Loan Agreement, in the name and behalf of the Metropolitan Government; to deliver such documents to the other parties to such documents, such execution and delivery to be conclusive proof of the approval of the Metropolitan Government of such documents; and to take such further action and to execute and deliver such further instruments or documents as the Mayor may consider necessary or advisable in connection with the Loan Agreement. Provided, however, this resolution shall not be deemed to grant authority to the Mayor to approve any increase in the amount of the Project Loan.

Section 8. That to the extent any portion of this Resolution is held to be invalid or unenforceable by a final judgment of a court of competent jurisdiction, the invalidity thereof shall in no way affect any of the other sections of this Resolution.

Section 9. That this resolution shall become effective from and after its final passage, the welfare of the Metropolitan Government of Nashville and Davidson County requiring it.

Sponsored by: Ronnie Steine, Walter Hunt

Attachment(s) on file in the Metropolitan Clerk's Office

LEGISLATIVE HISTORY
Referred to:	Budget & Finance Committee Public Works Committee
Introduced:	October 6, 2009
Adopted:	October 6, 2009
Approved:	October 8, 2009
By: