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HomeMy WebLinkAboutResolutions - 2022.09.29 - 37612 AGENDA ITEM: Resolution - Full Faith and Credit Pledge to Issue Bonds for Improvements to the Evergreen Farmington Sanitary Drain Drainage System 22-314 COMMITTEE MEETING: Board of Commissioners DATE: Thursday, September 29, 2022 12:58 PM - Click to View Agenda ITEM SUMMARY SHEET DEPARTMENT SPONSORED BY Water Resources Commissioner William Miller III INTRODUCTION AND BACKGROUND POLICY ANALYSIS This is a request for the irrevocably full faith and credit pledge to issue bonds for the improvements to the Evergreen Farmington Sanitary Drain Drainage System, an intra-county drain, in the amount of $135 million (not to exceed) (cost estimate Exhibit A). The improvements are necessary to bring the previously established Evergreen-Farmington Sewage Disposal System into compliance with Administrative Consent Order 04995 (the “ACO”) entered by the State of Michigan Department of the Environment, Great Lakes, and Energy on August 14, 2019. The Bonds are to be designated “Evergreen-Farmington Sanitary Drain Bonds, Series 2022”. It’s anticipated that the Bonds will be sold in January 2023, after the closing with Michigan Finance Authority (MFA) on January 20, 2023, and there is a 20-year repayment. The statutory limit for County debt is $8,973,575,513 (10% of State Equalized Value). As of August 22, 2022, the total pledged debt is $525,265,667 or approximately .58534% of the S.E.V. The apportionment was established and determined by the Drain Board under the State of Michigan Drain Code. The project was petitioned by the communities and a public hearing was held by the Drain Board and there were no objections to the apportionment or project. The estimated apportionment is as follows: City of Auburn Hills 0.46% $ 621,000 Village of Beverly Hills 5.75% $ 7,762,500 Village of Bingham Farms 0.69% $ 931,500 City of Birmingham 0.11% $ 148,500 Charter Twnshp of Bloomfield 9.54% $12,879,000 City of Bloomfield Hills 1.44% $ 1,944,000 City of Farmington 0.34% $ 459,000 City of Farmington Hills 28.29% $38,191,500 Village of Franklin 0.21% $ 283,500 City of Keego Harbor 0.32% $ 432,000 City of Lathrup Village 3.06% $ 4,131,000 City of Orchard Lake Village 0.37% $ 499,500 City of Southfield 38.17% $ 51,529,500 City of Troy 3.15% $ 4,252,500 Charter Twnshp of W Bloomfld 8.10% $ 10,935,000 Total 100% $135,000,000 The improvements are expected to be financed by multiple series of bonds with efforts to utilize State Revolving Loan Fund (SRF) funds as well as publicly sold bonds where SRF financing is not available. The Bonds shall bear interest at a rate not to exceed 6.0% per annum; however, the WRC will be advised by the SRF on what the interest rate will be for 2023 as well as any amount of principal forgiveness that would be granted to the project. The bonds will be secured by revenues of the System and by the County's full faith and credit pledge. There will be a collection of an equal amount of installments of special assessments from the 15 CVTs as listed in the resolution. The Drainage District intends to qualify amounts advanced by the Drainage District to the Project for reimbursement from proceeds of the Bonds per agreement with the requirements of Section 1.150-2 of the Treasury Regulations on Income Tax (the “Reimbursement Regulations”). The Drain Board is the designated authority for the bonds. A budget amendment is not required. State law requires a 2/3 majority vote by the Board of Commissioners for adoption of the proposed resolution to pledge the full faith and credit of the County for the prompt payment of the principal of and interest on the Bonds pursuant to Section 474 of the Act. mcl-Act-40-of-1956.pdf (mi.gov) BUDGET AMENDMENT REQUIRED: No Committee members can contact Michael Andrews, Policy and Fiscal Analysis Supervisor at 248.858.5115 (office) or andrewsmb@oakgov.com, or the department contact persons listed for additional information. CONTACT Sid Lockhart Evans Bantios Laura Bassett Steven Burke ITEM REVIEW TRACKING William Miller III, Created/Initiated - 9/29/2022 David Woodward, Board of Commissioners Approved - 9/29/2022 Hilarie Chambers, Executive's Office Approved - 10/3/2022 Lisa Brown, Clerk/Register of Deeds Final Approval - 10/4/2022 AGENDA DEADLINE: 10/09/2022 12:58 PM COMMITTEE TRACKING 2022-09-14 Economic Development & Infrastructure - Recommend and Forward to Finance 2022-09-15 Finance - Recommend to Board 2022-09-29 Full Board - Adopted ATTACHMENTS 1. 2022-09-14 memo EF LTCAP to accompany intent resolution 2. Exhibits to Accompany Resolution 3. 2022-08-23 Evergreen-Farmington Resolution September 29, 2022 MISCELLANEOUS RESOLUTION #22-314 Sponsored By: William Miller III Water Resources Commissioner - Resolution - Full Faith and Credit Pledge to Issue Bonds for Improvements to the Evergreen Farmington Sanitary Drain Drainage System Chairperson and Members of the Board: WHEREAS proceedings have been taken by the Drainage Board for the Evergreen-Farmington Sanitary Drain (the “Drainage Board”) for the location, establishment and construction of an intra- county drain project consisting of all improvements necessary to bring the previously established Evergreen-Farmington Sewage Disposal System into compliance with Administrative Consent Order 04995 (the “ACO”) entered by the State of Michigan Department of the Environment, Great Lakes, and Energy on August 14, 2019, as further described in Exhibit A attached hereto, and that now serve the Evergreen-Farmington Sanitary Drain located in the City of Auburn Hills, the Village of Beverly Hills, the Village of Bingham Farms, the City of Birmingham, the Charter Township of Bloomfield, the City of Bloomfield Hills, the City of Farmington, the City of Farmington Hills, the Village of Franklin, the City of Keego Harbor, the City of Lathrup Village, the City of Orchard Lake Village, the City of Southfield, the City of Troy and the Charter Township of West Bloomfield, in the County of Oakland (the “County”), under the provisions of Chapter 20 of the Drain Code of 1956, as amended, pursuant to a petition filed with the Oakland County Water Resources Commissioner (the “Project”); and WHEREAS the Drainage Board is expected to authorize and provide for the issuance by the Evergreen-Farmington Sanitary Drain Drainage District of one or more series of bonds (the "Bonds") in the aggregate principal amount of not to exceed $135,000,000 to finance all or part of the costs of the Evergreen-Farmington Sanitary Drain, in anticipation of the collection of an equal amount of installments of special assessments against the City of Auburn Hills, the Village of Beverly Hills, the Village of Bingham Farms, the City of Birmingham, the Charter Township of Bloomfield, the City of Bloomfield Hills, the City of Farmington, the City of Farmington Hills, the Village of Franklin, the City of Keego Harbor, the City of Lathrup Village, the City of Orchard Lake Village, the City of Southfield, the City of Troy and the Charter Township of West Bloomfield, said special assessments to be duly confirmed by the Drainage Board; and WHEREAS the Bonds are to be designated “Evergreen-Farmington Sanitary Drain Bonds, Series 2022”, with such other designations, including, without limitation, designations for multiple series, as determined by an officer duly authorized by the Drainage Board; provided that, if any series of the Bonds are not issued in calendar year 2022, an officer duly authorized by the Drainage Board may re- designate such series of Bonds to reflect the year in which such series of Bonds are issued; and WHEREAS pursuant to a Final Order of Apportionment dated June 22, 2021 adopted by the Drainage Board for the Drainage District, the estimated project cost of $135,000,000 will be apportioned to the following Public Corporations as indicated in the Chart below: Public Corporations: City of Auburn Hills 0.46% $ 621,000.00 Village of Beverly Hills 5.75% $ 7,762,500.00 Village of Bingham Farms 0.69% $ 931,500.00 City of Birmingham 0.11% $ 148,500.00 Charter Township of Bloomfield 9.54% $ 12,879,000.00 City of Bloomfield Hills 1.44% $ 1,944,000.00 City of Farmington 0.34% $ 459,000.00 City of Farmington Hills 28.29% $ 38,191,500.00 Village of Franklin 0.21% $ 283,500.00 City of Keego Harbor 0.32% $ 432,000.00 City of Lathrup Village 3.06% $ 4,131,000.00 City of Orchard Lake Village 0.37% $ 499,500.00 City of Southfield 38.17% $ 51,529,500.00 City of Troy 3.15% $ 4,252,500.00 Charter Township of West Bloomfield 8.10% $ 10,935,000.00 Total 100.0000% $135,000,000.00; and WHEREAS the statutory limit for County debt is $8,973,575,513 (10% of State Equalized Value). As of August 22, 2022, the total pledged debt is $525,265,667 or approximately .58534% of the S.E.V; and WHEREAS the Bonds shall bear interest at a rate not to exceed 6.0% per annum; and WHEREAS the Oakland County Board of Commissioners may, by resolution adopted by a two-thirds vote of its members elect, pledge the full faith and credit of the County for the prompt payment of the principal of and interest on the Bonds pursuant to Section 474 of the Act; and WHEREAS the Drainage Board deems it advisable and necessary to obtain from this Board a resolution pledging the full faith and credit of the County on the Bonds; and WHEREAS the Project is necessary to protect and preserve the public health and to achieve compliance with the ACO, and therefore, it is in the best interest of the County of Oakland that the Bonds be sold. NOW THEREFORE BE IT RESOLVED that pursuant to the authorization provided in Section 476 of the Drain Code of 1956, as amended, provided that the Bonds are issued within the parameters set forth above, the Oakland County Board of Commissioners, by a two-thirds vote of its members elect, does hereby irrevocably pledge the full faith and credit of the County of Oakland for the prompt payment of the principal of and interest on the Bonds, and does agree that in the event that any public corporation assessed shall fail or neglect to account to the County Treasurer of the County of Oakland for the amount of any special assessment installment and interest, when due, then the amount thereof shall be immediately advanced from County funds, and the County Treasurer is directed to immediately make such advancement to the extent necessary. BE IT FURTHER RESOLVED in the event that, pursuant to said pledge of full faith and credit, the County advances out of County funds, all or any part of said installment and interest, it shall be the duty of the County Treasurer, for and on behalf of the County, to take all actions and proceedings and pursue all remedies permitted or authorized by law for the reimbursement of such sums so paid. BE IT FURTHER RESOLVED that the County Treasurer is hereby authorized, if necessary, to execute a certificate of the County to comply with the continuing disclosure undertaking of the County with respect to the Bonds pursuant to paragraph (b)(5) of SEC Rule 15c2-12 issued under the Securities Exchange Act of 1934, as amended, and amendments to such certificate from time to time in accordance with the terms of such certificate (the certificate and any amendments thereto are collectively referred to herein as the "Continuing Disclosure Certificate"). The County hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate. BE IT FURTHER RESOLVED that all resolutions and part of resolutions, insofar as the same may be in conflict with the provisions of this resolution, be and the same hereby are rescinded. BE IT FURTHER RESOLVED that no budget amendment is required. Chairperson, the following Commissioners are sponsoring the foregoing Resolution: William Miller III. Date: September 29, 2022 David Woodward, Commissioner Date: October 03, 2022 Hilarie Chambers, Deputy County Executive II Date: October 04, 2022 Lisa Brown, County Clerk / Register of Deeds COMMITTEE TRACKING 2022-09-14 Economic Development & Infrastructure - Recommend and Forward to Finance 2022-09-15 Finance - Recommend to Board 2022-09-29 Full Board - Adopted VOTE TRACKING Motioned by Commissioner Michael Gingell seconded by Commissioner Gary McGillivray to adopt the attached Resolution: - Full Faith and Credit Pledge to Issue Bonds for Improvements to the Evergreen Farmington Sanitary Drain Drainage System. Yes: David Woodward, Michael Gingell, Michael Spisz, Karen Joliat, Kristen Nelson, Eileen Kowall, Christine Long, Philip Weipert, Gwen Markham, Angela Powell, Thomas Kuhn, Chuck Moss, Marcia Gershenson, William Miller III, Yolanda Smith Charles, Charles Cavell, Penny Luebs, Janet Jackson, Gary McGillivray, Robert Hoffman (20) No: None (0) Abstain: None (0) Absent: (0) Passed ATTACHMENTS 1. 2022-09-14 memo EF LTCAP to accompany intent resolution 2. Exhibits to Accompany Resolution 3. 2022-08-23 Evergreen-Farmington Resolution STATE OF MICHIGAN) COUNTY OF OAKLAND) I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and accurate copy of a resolution adopted by the Oakland County Board of Commissioners on September 29, 2022, with the original record thereof now remaining in my office. In Testimony Whereof, I have hereunto set my hand and affixed the seal of the Circuit Court at Pontiac, Michigan on Thursday, September 29, 2022. Lisa Brown, Oakland County Clerk / Register of Deeds Form DC–001 OAKLAND COUNTY WATER RESOURCES COMMISSIONER Page 1 of 1 Rev.: 11/05/08 OAKLAND COUNTY WATER RESOURCES COMMISSIONER MEMORANDUM TO: William Miller, Chairperson Economic Development and Infrastructure Committee FROM: Sid Lockhart, P.E., Deputy & Special Projects Manager SUBJECT: Full Faith and Credit Pledge to Issue Bonds for Improvements for the Evergreen Farmington Sanitary Drain Drainage System DATE: September 9, 2022 Petitions have been received by the Drain Board for the above referenced County Drain in accordance with Chapter 20 of the Drain Code of 1956, as amended for a series of projects that has been acknowledged by the State of Michigan Department of Environment, Great Lakes, and Energy to comply with its Administrative Consent Order for the Sanitary Sewer Drain. Improvements are needed to promote the health and welfare of the residents served by the system facilities as well as others in the region by significantly reducing sanitary sewer overflows. The system is comprised of the City of Auburn Hills, the Village of Beverly Hills, the Village of Bingham Farms, the City of Birmingham, the Charter Township of Bloomfield, the City of Bloomfield Hills, the City of Farmington, the City of Farmington Hills, the Village of Franklin, the City of Keego Harbor, the City of Lathrup Village, the City of Orchard Lake Village, the City of Southfield, the City of Troy and the Charter Township of West Bloomfield. Such improvements are expected to be financed by multiple series of bonds and efforts are being undertaken to utilize State Revolving Loan Fund (SRF) dollars as well as publicly sold bonds where SRF financing is not available. The Water Resources Commissioner’s Office is awaiting guidance from the SRF on what the interest rate will be for 2023 as well as any amount of principal forgiveness that would be granted to the project. The bonds would be issued in one or more series in the aggregate principal amount not to exceed $135 million and will be secured by revenues of the System and the by the County's full faith and credit pledge. I offer the accompanying resolution and respectfully request its adoption by this Committee, as well as by the Finance Committee and ultimately by the full Board of Commissioners. Presenters: Sid Lockhart, P.E., Deputy and Special Projects Manager Phone: 248-858-1082 Evans Bantios, P.E., Chief Engineer Phone: 248-452-2271 Laura Bassett, Esq., Dickinson Wright, PLLC Phone: 248-433-7566 Steven A. Burke, CFA, MFCI, LLC Phone: 313-782-3011 Exhbit A Evergreen-Farmington Sanitary Drain Drainage District Project As set forth in the petition filed with the Oakland County Water Resources Commissioner pursuant to the provisions of Chapter 20 of the Drain Code of 1956, as amended, to be located as specified in Schedule 1 hereto and the estimated cost of which as specified in Schedule 2 hereto, the intra-county drain project consisting of all improvements necessary to bring the previously established Evergreen-Farmington Sewage Disposal System into compliance with Administrative Consent Order 04995 entered by the State of Michigan Department of the Environment, Great Lakes, and Energy on August 14, 2019, shall include, without limitation, one or more of the following: 1. The provision of additional outlet capacity for the Evergreen-Farmington Sewage Disposal System by purchasing said capacity from the Great Lakes Water Authority (“GLWA”), such purchase to enable GLWA to acquire and construct sewage disposal system improvements to remove downstream wet weather flow to allow for the additional outlet capacity for the Evergreen- Farmington Sewage Disposal System. 2. The acquisition and construction of improvements to the Walnut Lake Pump Station No. 1 to increase Evergreen Interceptor operating levels and the coordination of operations of facilities in the Evergreen-Farmington Sewage Disposal System. 3. Improvements at the 8 Mile SSO chamber, including but not limited to the acquisition, construction, and modification of piping, weirs, gates, and meters. 4. The acquisition and construction of other improvements to the Evergreen-Farmington Sewage Disposal System, including sewage retention tanks and associated pumps, piping, and connections. 5. Construction of storage facilities within the geographical limits of the Evergreen-Farmington Sewage Disposal System, including, without limitation, a multi-million gallon sewage retention tank on Eight Mile Road in the City of Southfield. Schedule 1 Evergreen-Farmington Sanitary Drain Drainage District Project [See Map Attached] Schedule 2 Evergreen-Farmington Sanitary Drain Drainage District Project [See Estimated Cost Attached] 4886-6972-3177 v3 [9007-446] 8 Mile Conveyance CAP Lathrup Village CAP Walnut Lake Pump Station No. 1 CAP Capacity Increase Purchase from GLWA Total CAP Project Estimates 1)Contracted Services: Construction Cost a Engineers Estimate of Facility 56,034,991$ 1,402,600$ 3,100,000$ 38,200,000$ 98,737,591$ Subtotal Construction Cost 56,034,991$ 1,402,600$ 3,100,000$ 38,200,000$ 98,737,591$ 2)Engineering Consultants a Design Phase 3,025,813$ 164,000$ 190,000$ 200,000$ 3,579,813$ b Construction Administration 3,058,813$ 140,260$ 190,000$ 3,389,073$ c Scheduling Consultant 327,730$ 327,730$ d Preconstruction for Walsh 849,980$ 849,980$ Subtotal Engineering Consultants 7,262,336$ 304,260$ 380,000$ 200,000$ 8,146,596$ 3)Legal & Financial (Examples) a Easements 300,000$ 14,026$ 50,000$ 364,026$ b Legal Costs 280,175$ 5,000$ 50,000$ 400,000$ 735,175$ c Finacial Consultant 100,000$ 5,000$ 50,000$ 300,000$ 455,000$ d Bond Counsel 470,000$ 50,000$ 250,000$ 950,000$ 1,720,000$ e OCIP Insurance 2,650,000$ 10,000$ 50,000$ 2,710,000$ f Official Statement 40,000$ 40,000$ g Wetland Mitigation Subtotal Legal & Financial 3,840,175$ 84,026$ 450,000$ 1,650,000$ 6,024,201$ 4)County Services: (Examples) a Administration & General (ADM)560,350$ 14,026$ 30,000$ 115,000$ 719,376$ b Engineering (ENG)2,801,750$ 70,130$ 125,000$ 200,000$ 3,196,880$ c Right-Of-Way (ROW)280,175$ 28,052$ 50,000$ 358,227$ d Construction Inspection (INS)4,482,799$ 210,390$ 400,000$ 5,093,189$ e GIS Mapping (ADM)280,175$ 14,026$ 30,000$ 324,201$ f Operation Staff (STD)280,175$ 14,026$ 30,000$ 324,201$ g Survey (SUR)280,175$ 28,052$ 30,000$ 338,227$ . Subtotal County Services 8,965,599$ 378,702$ 695,000$ 315,000$ 10,354,301$ Project Subtotal 76,103,101$ 2,169,588$ 4,625,000$ 40,365,000$ 123,262,689$ 5)10% Project Contingency 7,610,310$ 216,959$ 462,500$ 8,289,769$ 6)Less Anticipated Grant Funds 7)Total Project Cost 83,713,411$ 2,386,547$ 5,087,500$ 40,365,000$ 131,552,458$ I hereby certify that the useful life of these facilities is 30 years or greater. ______________________________ (Engineer) Evergreen Farmington Sanitary Drain Overall Corrective Action Plan - Phase II Cost Estimate Revised: 6/6/2022 Jim Nash 6/3/2020 RESOLUTION DECLARING OFFICIAL INTENT TO REIMBURSE PROJECT EXPENDITURES WITH BOND PROCEEDS At a meeting of the Drainage Board for the Evergreen-Farmington Sanitary Drain held on August 23, 2022. PRESENT: ABSENT: The following resolution was moved by ___________________ and seconded by _________________: WHEREAS, the Evergreen-Farmington Sanitary Drain Drainage District (the “Drainage District”) proposes to issue its tax-exempt bonds, in one or more series (the “Bonds”) under the Drain Code, Act 40, Public Acts of Michigan, 1956, as amended, to finance the location, establishment and construction of the Evergreen-Farmington Sanitary Drain, consisting of all improvements necessary to bring the previously established Evergreen-Farmington Sewage Disposal System into compliance with Administrative Consent Order 04995 entered by the State of Michigan Department of the Environment, Great Lakes, and Energy on August 14, 2019, and that now serve the Evergreen-Farmington Sanitary Drain (the “Project”); and WHEREAS, it is anticipated that the Drainage District will advance a portion of the costs of the Project prior to the issuance of the Bonds, such advance to be repaid from proceeds of the Bonds upon the issuance thereof; and WHEREAS, Section 1.150-2 of the Treasury Regulations on Income Tax (the “Reimbursement Regulations”) specifies conditions under which a reimbursement allocation may be treated as an expenditure of bond proceeds, and the Drainage District intends by this resolution Commissioner Markham Commissioner Woodward Jim Nash, Oakland County Water Resources Commissioner Gwen Markham, Chairperson of the Finance Committee, Oakland County Board of Commissioners David Woodward, Chairperson of the Oakland County Board of Commissioners None. -2- to qualify amounts advanced by the Drainage District to the Project for reimbursement from proceeds of the Bonds in accordance with the requirements of the Reimbursement Regulations. THEREFORE, BE IT RESOLVED ON BEHALF OF THE EVERGREEN- FARMINGTON SANITARY DRAIN DRAINAGE DISTRICT, as follows: 1.The Project shall be as described in the preamble hereto. 2.The aggregate maximum principal amount of Bonds expected to be issued for the Project is $135,000,000. 3.The Drainage District hereby declares its official intent to issue the Bonds to finance the costs of the Project, and hereby declares that it reasonably expects to reimburse the Drainage District’s advances to the Project as anticipated by this resolution. 4.The Bonds shall be authorized by proper proceedings subsequent to this resolution. 5.All other resolutions and parts of other resolutions insofar as they may be in conflict with this resolution are hereby rescinded. YEAS: NAYS: ABSTAIN: RESOLUTION DECLARED ADOPTED. 3 0 0 -3- STATE OF MICHIGAN ) )ss COUNTY OF OAKLAND ) I hereby certify that the foregoing is a true and complete copy of a resolution adopted at a meeting of the Drainage Board for the Evergreen-Farmington Sanitary Drain, County of Oakland, Michigan, held on August 23, 2022, the original of which resolution is on file in the offices of the Oakland County Water Resources Commissioner. I further certify that notice of said meeting was given in accordance with the Open Meetings Act. Jim Nash Chairperson of Drainage Board 4856-1194-4233 v2 [9007-446]