HomeMy WebLinkAboutResolution 2012-105 N.C.S. 07/02/2012 Resolution No. 2012-105 N.C.S.
of the City of Petaluma, California
AUTHORIZING AN INTERFUND LOAN FROM THE STORM DRAINAGE
IMPACT FEE FUND TO THE STORM WATER UTILITY FUND
WHEREAS, Storm water maintenance and operations costs have historically been
budgeted in the Wastewater Utility Fund; and,
WHEREAS, a portion of the activities associated with those costs do not directly support
the operations of the Wastewater system; and,
WHEREAS, those costs were removed from the Wastewater Utility fund and excluded
from expenses included in rate setting adjustments that were approved by the City Council in
November 2011 and became effective on January 1, 2012; and,
WHEREAS, Staff has conducted a thorough analysis of all activities associated with
storm water maintenance and operations, and has identified core activities which are required to
maintain the storm water system and protect the community and environment from the adverse
effects of unmanaged storm water runoff; and,
WHEREAS, those activities are estimated to cost approximately $500,000 per year, and
are now budgeted in a separate Storm Water Utility fund for which there is not yet a dedicated
funding source; and,
WHEREAS, it is the intention of the City Council to investigate options for establishing
a dedicated funding source for the aforementioned activities, and such investigation is
anticipated to be completed by January 2015; and,
WHEREAS, in the meanwhile, due to financial hardship, it is not possible to support the
aforementioned activities through a subsidy from the General Fund such that another funding
source is required in the near-term; and,
WHEREAS, funds are available in the Storm Drainage Impact Fee Fund that can be used
to support these costs; and,
WHEREAS, it is the policy of the City Council that interfund loans of greater than one
year may be approved, provided that such loans are repaid in fifteen (15) years or less, and that
interest should be paid on such loans.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Petaluma
hereby approves an interfund loan from the Storm Drainage Impact Fee fund to the Storm Water
Utility fund.
1. The interfund loan shall be formalized pursuant to a Promissory Note, attached and
incorporated herein as Exhibit A.
Resolution No. 2012-105 N.C.S. Page 1
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2. The loan amount shall not exceed $800,000 unless authorized by the City Council.
3. Amounts shall be transferred as the City Manager directs from time to time, not to exceed
the total sum of$800,000. These funds shall provide for core storm water maintenance
and operations activities for the period from January 1, 2012 through June 30, 2013.
4. Interest shall be charged at the rate of that earned by the City Treasurer's Investment
Portfolio (variable %) per annum, and shall accrue quarterly, effective January 1, 2012.
5. The first loan payment, including accrued interest, shall be made on June 30, 2015 and
annually thereafter, in twelve equal annual installments, such that the entire principal and
interest shall be repaid on or before June 30, 2026, unless extended by the City Council.
6. Payment of the full amount of principal advanced and any interest otherwise unpaid shall
be made no later than June 30, 2026, unless extended by the City Council.
7. The City Manager and Finance Director/City Treasurer are hereby authorized to execute
the Promissory Note and any associated documents that may be subsequently needed.
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Under the power and authority conferred upon this Council by the Charter of said City.
REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the p4o\ed as to
Council of the City of Petaluma at a Regular meeting on the 2nd day of July.2012, t$,m:
by the following vote:
City ttomey
AYES: Albertson, Barrett, Mayor Glass, Harris,Healy,Kearney,Vice Mayor Renee
NOES: None
ABSENT: None
ABSTAIN: None
ATTEST: e/ / , ! l A: I
, drat /LIS:
City Clerk Mayor
Resolution No. 2012-105 N.C.S. Page 2
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EXHIBIT A
CITY OF PETALUMA, CA
PROMISSORY NOTE FOR INTERFUND LOAN
This Promissory Note (Note) for an Interfund Loan is executed as of July 3, 2012, by the City
Treasurer of the City of Petaluma, acting as custodian of the funds of the City of Petaluma, and
the City Manager of the City, acting for the City Council in implementation of the directives and
authority of Resolution Number 2012-105 N.C.S., adopted on July 2, 2012.
1. The Treasurer shall transfer to the Storm Water Utility Fund, from the Storm Drainage Impact
Fee Fund, the expenditures necessary and incurred during each fiscal year for core storm
water maintenance and operations activities for the period from January 1, 2012 through
June 30, 2013, not to exceed the total principal sum of Eight Hundred Thousand dollars
($800,000).
2. Interest shall accrue quarterly, without compounding, beginning January 1, 2012, on all
principal sums advanced at the same rate as for the City Treasurer's Investment Portfolio
(variable %) per annum, based on the previous year earnings of said portfolio.
3. Payment of principal and all interest accrued as of January 1, 2015 shall begin on June 30,
2015 and shall be made in twelve equal annual installments such that the entire principal
and accrued interest shall be fully repaid on or before June 30, 2026.
4. The full sum of the Interfund Loan including all principal advanced and interest otherwise
remaining unpaid pursuant to this Promissory Note is due and payable no later than June 30,
2026. The full sum or any partial payment of principal may be prepaid with no penalty.
5. This Note is subject to the terms of City of Petaluma Resolution Number 2012-105 N.C.S.
Executed as of the date first above written
CITY OF PETALUMA, CA
By:
City Treasurer
By:
City Manager
Approved as to form this day of , 20 .
By:
City Attorney
Resolution No.2012-105 N.C.S. Page 3