WHEREAS:

1. Section XV.E. of the Policy for Implementing the State Revolving Fund for Construction of Wastewater Treatment Facilities (Policy) and Section 11 of the SRF loan contract prohibit the sale of future local debt that is senior to any SRF debt;

2. The City of Chico (City), by letter dated March 4, 1998, requested a modification to the language of Section 11 of their SRF loan contract; and

3. The Division of Clean Water Programs has reviewed the request and finds that review of future City revenue programs for the SRF debt is adequate to assure reasonable protection against default.

THEREFORE BE IT RESOLVED THAT:

The State Water Resources Control Board approves modification to the language of Section 11 of the SRF loan contract to read "Future Local Debt: All future local debt incurred by the City which is secured by the dedicated source of revenue shall be on parity with, or subordinate to, the SRF debt. The City must submit a revised revenue program to the Division of Clean Water Programs which must be reviewed and approved prior to the time that the City incurs any bonded indebtedness for other locally funded projects."

The undersigned, Administrative Assistant to the Board, does hereby certify that the foregoing is a full, true, and correct copy of a resolution duly and regularly adopted at a meeting of the State Water Resources Control Board held on May 27, 1998.

/s/

Maureen Marché

Administrative Assistant to the Board