ITEM 6: APPROVAL OF EXTENSION OF PRELIMINARY STATE REVOLVING FUND (SRF) LOAN COMMITMENT FOR THE CITY OF AUBURN, WASTEWATER TREATMENT PLANT FACILITIES IMPROVEMENT PROJECT, SRF LOAN PROJECT NO. C-06-4471-110

DISCUSSION: The State Water Resources Control Board (SWRCB) adopted Resolution No. 97-074 on September 18, 1997. Resolution No. 97-074 approved a zero percent interest SRF loan of $9.85 million to the City of Auburn (City) for the construction of the Wastewater Treatment Plant Facilities Improvement Project. Resolution No. 97-074 required bids to be opened by November 3, 1997 for Phase I (filters) and biddable plans and specifications (P&S) to be submitted to the Division by June 22, 1998, for Phase II (treatment facilities). Phase I construction is nearly complete and a loan contract has been executed. However, due to litigation, which is still pending, and uncertainty concerning the final revised National Pollutant Discharge Elimination System (NPDES) Permit requirements, design of Phase II was put on "hold" recently. The City requested a 90-day extension to September 22,1998, which was approved by staff. The City has requested in writing that the preliminary loan commitment approved by Resolution No. 97-074 for Phase II be extended by six months beyond the September 22, 1998 date.

The preliminary loan commitment approved by Resolution No. 97-074 was based on approval of a proposed project that would meet the provisions of the NPDES Order No. 94-287 in effect at that time. Since then, new Tentative Waste Discharge Requirements (TWDR's) were proposed for adoption at the Central Valley Regional Water Quality Control Board's (CVRWQCB) April 17, 1998 meeting. These TWDR's contained significant changes to the original permit. There has been a great deal of public participation and input from local citizens as well as many organizations and agencies. Litigation by downstream residents against the project filed in Placer County Superior Court is still pending. The result is TWDR's will not be considered for adoption at the CVRWQCB meeting until September 1998. The changes proposed in these TWDR's warrant a re-evaluation of the scope of the proposed project. Therefore, an extension of time for the City to develop an appropriate project to meet the new WDR's is necessary.

POLICY ISSUE: Should the SWRCB approve an extension of preliminary loan commitment to the City of Auburn? Should the SWRCB, in accordance with Section IX (J) of the SRF Policy, condition this approval by requiring expiration of the preliminary loan commitment if Final Plans and Specifications Approval for Phase II is not issued by April 22, 1999 by the Division of Clean Water Programs?

RWQCB IMPACT: None.

FISCAL IMPACT: None. The loan commitment has previously been accounted for when the proposed project was approved for the zero percent interest SRF loan on September 18, 1997.

STAFF RECOMMENDATION: That the SWRCB adopt a resolution approving an extension of preliminary loan commitment for Phase II until April 22, 1999, for Final Plans and Specifications Approval.

DRAFT August 21, 1998

WHEREAS:

1. The State Water Resources Control Board, on September 18, 1997, adopted Resolution No. 97-074;
2. Resolution No. 97-074 approved a zero percent interest SRF loan of $9,850,000 to the City of Auburn for construction of Wastewater Treatment Plant Facilities Improvement Project;
3. The project was to be built in two Phases, and Phase I construction on the filters is nearly complete, and a loan contract has been issued; and
4. The City of Auburn has requested an extension of preliminary loan commitment for Phase II due to reasons beyond the City's control.

THEREFORE BE IT RESOLVED THAT:

The State Water Resources Control Board:

1. Approves an extension of preliminary loan commitment until April 22, 1999; and
2. Will withdraw this preliminary loan commitment if Final Plans and Specifications Approval for Phase II is not issued by the Division of Clean Water Programs by April 22, 1999. No further extension will be considered by the Board.

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 September 17, 1998.

Maureen Marché

Administrative Assistant to the Board