I-JOBS Water Quality Fund Application_Water Pollution Control Plantzoos
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: I-JOBS Water Quality Fund Application -Water Pollution Control Plant
Replacement
DATE: November 9, 2009
Stimulus Coordinator Will Hoyer recommends City Council approval of the submittal of a
$5,000,000 grant application to the Iowa Finance Authority for I-JOBS Water Quality
Fund money for the replacement of the Water Pollution Control Plant.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Will Hoyer, Stimulus Coordinator
THE CITY OF Dubuque
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Masterpiece on the Mississippi
2007
TO:- Michael C. Van Milligen, City Manager
FROM: Will Hoyer
SUBJECT: I-JOBS Water Quality Fund application -Water Pollution Control Plant
Replacement
DATE: November 3, 2009
INTRODUCTION
The purpose of this memorandum is to request approval of the submittal of a
$5,000,000 grant application to the Iowa Finance Authority.
BACKGROUND
The I-JOBS initiative was created in 2008 by Governor Culver and includes $830 million
in funding over three years. Much of this money was intended for infrastructure
improvements and disaster (flood) recovery. Eighty million dollars were ear-marked for
water quality projects and $20 million of that was targeted at cities with populations over
10,000. The Iowa Finance Authority has control over these dollars and will pair grant
money with State Revolving Fund (SRF) money for large water quality projects.
Dubuque is seeking $5 million in I-JOBS funding for the replacement of the Water
Pollution Control Plant (WPCP). The cost of replacing the WPCP is now estimated at
over $60 million.
Dubuque is also seeking I-JOBS Water Quality Fund money for restoration of the Lower
Bee Branch (see separate memo).
DISCUSSION
The WPCP was built in 1969 and many components are original and beyond their
useful life. As such they are increasingly unreliable and inefficient systems. Anew
plant is needed to increase efficiency and reliability, remedy past violations and to
incorporate the City Council's goals of sustainability into wastewater treatment.
The new facility will no longer use incineration to dispose of waste; instead, it would
incorporate anaerobic digestion and co-generation to become a net electricity producer.
It will model many sustainable practices on-site such as geo-thermal heating and rain
gardens and will have the ability to incorporate solar and wind power generation.
It is anticipated that there will be new conditions to the facility's National Pollution
Discharge Elimination System (NPDES) permit when it is next issued and the effluent
leaving the plant and entering the Mississippi River will be able to safely meet those
conditions.
Construction is expected to start on this project June 1, 2010 and will likely take 2'/2
years to complete.
RECOMMENDATION:
Staff recommends Council approval of submittal of the I-JOBS grant application to fund
$5,000,000 of the costs of constructing the new WPCP.
cc: Cori Burbach, Sustainable Community Coordinator
Teri Goodmann, Assistant City Manager
Cindy Steinhauser, Assistant City Manager
Jonathan Brown, Water Pollution Control Plant Manager
CUIVERlJUDa[
Water Quality
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Large Community Application (pop. > 10,000}
Applicant: City of Dubuque (Water Pollution Control Plant Replacement)
Tax ID Number: 42-6004596
Contact person/Title: Jonathan Brown, Water Pollution Control Plant Manager
Address: 50 West 13~" Street
City Dubuque County Dubuque Zip Code: 52001
Telephone Number: (563) 589-4176 E-mail address: jobrown@cityofdubuque.org
Population served by the system 57,696
® Wastewater NPDES Number: EPA ID: IA0044458; permit number: 3126001
^ Drinking Water PWSID Number:
^ Storm Water Permit Number (if applicable): _
Is this project identified in an Iowa Great Places agreement? ^ Yes ®No
If yes, submit documentation that the proposed project is identified in an Iowa Great Places agreement.
Have you begun the process for an SRF loan
Ve AT„ T.T~A r~_._ r
Initiation meeting with DNR LGLLV LV11Li
June 14, 2007 LQI.G t,X Cirr ~~'iu
IUP application filed with PER or facility plan May 29, 2008
Project listed on an approved IUP 2009
Environmental Review (FONSI or CX) complete July 21, 2008
Operating Permit issued applied for:
Construction Permit issued
^ May 2008
application to
be submitted:
Others:
March 2010
What is the expected construction start date?
Have construction bids been awarded?
What is the expected project completion date?
June 1, 2010
^ Yes ®No
December 2012
System Utilization for the most
recent ear•
Residential Number of
Connections
20,058 Annual Revenue
$4,301,863 Percentage of System
Usa e (DW onl )
47%
Commercial 1,895 $1,428,903 37%
Industrial 72 $54,291 16%
Other 48 $36,194
lvwa rula[1GC r~usnonry wig Tirana Avenue Des Moines, IA 50312 800-432-7230
Unmetered
Total 22,073 $5,821,251 100%
PROFESSIONAL CONSULTANTS
Project Engineer: Strand Associates, Inc
Name of Contact Person: Randy Wirtz
Mailing Address: 910 Wingra Dr
City, State, and Zip Code: Madison, WI 53715
Telephone Number: 608-251-4813
E-mail address: randy.wirtz@strand.com
Bond Counsel: Ahlers & Cooney, LLP
Name of Contact Person: William Noth
Mailing Address: 100 Court Ave.
City, State, and Zip Code: Des Moines, IA 50309-2256
Telephone Number: 515-243-7611
E-mail address: wroth@ahlerslaw.com
Financial Advisor:
Name of Contact Person:
Mailing Address:
City, State, and Zip Code:
Telephone Number:
E-mail address:
SOURCE OF FUNDS/COST BREAKDOWN FOR PROJECT
Project Cost Breakdown
Administrative, Financial & Legal expenses $
Land and easements $120,000
Plannin & Design expenses $3,536,000
En ineerin construction fees $4,250,000
Construction $36,355,000
E ui ment $14,000,000
Interest durin construction $3,177,945
Miscellaneous $
Contin enc $5,036,000
Other- S ecify $
Total Project Cost $66,474,943
Anticipated Sources of Funds
CDBG $
USDA - ant $
USDA -loan $
WIRB grant $
Local funds $
Other- S eci $
SRF Loan & I-'obs grant $61,474,943 & $5,000,000
2
Total Source of Funds $66,474,943
Existing System Debt: Current Balance Interest
Rate Year
Issued Maturity
Date Annual Payment
(Principal + Interest)
Revenue Bonds $3,200,200 3.25 2009 2032 none for 3 years
$253,800 3.25 2006 2029 $12,297
Other Debt
(Pa able from S stem Revenues
Please write a brief description of the project:
The City of Dubuque's Water Pollution Control Plant (WPCP) is an incineration facility that was
constructed in 1969 and many of the equipment and systems are still original and beyond their useful life.
As such, they operate with low efficiency and are high maintenance systems that present significant
annual operating and maintenance costs to the taxpayers of Dubuque. These systems also have a negative
impact on the water quality of the Mississippi River. In 2006 the Mayor and City Council identified
sustainability as a top priority. In 2008 the Council unanimously approved the design of a new WPCP
that would convert our process from incineration to anaerobic digestion. This state of the art facility
would be an energy efficient and environmentally-friendly facility helping to reduce our carbon footprint.
Ground is expected to be broken in the summer of 2010 on this project, which would upgrade old
equipment and facilities, improve sampling capabilities, expand the lab, eliminate chlorine treatment and
replace it with UV treatment, add sludge processing capacity, increase the oxygenation of the effluent and
improve peak flow management and energy efficiencies throughout the facility while protecting water
quality. These improvements are needed to prepare for a projected 25% increase in service demand over
the next 20 years, to increase system reliability, to remedy past permit violations, and because of
anticipated changes to dissolved oxygen and pH requirements in the facility's next NPDES permit.
As a result of a city-wide commitment to sustainability and energy efficiency, the upgraded WPCP will
make use of anaerobic digestion, not only of the solid waste entering the wastewater system, but also of
food scraps collected daily from local institutions. The resulting bio-gas will be used to heat on-site
buildings and will be converted to electricity through the co-generation process and generate an additional
545 kW, equating to over $300,000 in additional revenue each year. The facility will make use of a
closed loop geothermal system as well and will be built to meet the EPA's EnergyStar 2011 standards.
The project will be developed to model low-impact development stormwater practices throughout the
property and will be built to allow for later retrofits of alternative energy, including wind and solar
technologies, on site.
Is the system under any regulatory compliance order? ^ Yes ®No
Describe how the project with improve water quality. For a wastewater or stormwater project, this would
be the quality of the receiving stream(s). For a drinking water project, this refers to the quality of the
drinking water (maintaining compliance, preventing contamination, etc):
The WPCP discharges water into the Mississippi River, the third largest river in the world, draining 2/3 of
the continental United States and feeding into the Gulf of Mexico. The Mississippi is listed on the federal
303(d} list as being impaired for such things as nutrients and bacteria. These impairments have
significant economic consequences as well as potential human health impacts. The upgrades to the
WPCP would increase the reliability of the system and lessen the likelihood for untreated bypasses of the
system during wet weather. During heavy rain events the city has long been plagued by the need to
bypass treatment and discharge into local waterways from the sewage distribution system. In addition the
new plant would replace chlorination with UV light in the final treatment stages, eliminating any
discharge of chlorine, and allow for water quality compliance with anticipated new requirements for
dissolved oxygen and pH in the facility's next discharge permit.
Additionally, by making use of anaerobic digestion and co-generating heat and electricity the plant will be
a net electrical generator, displacing electricity that largely generated by coal. Coal-fired power plants are
one of the primary sources of mercury in the nation's waters, and mercury is a potent neurotoxin that has
been found in fish in all of the nation's waterways. The nutrient-containing byproducts from anaerobic
digestion will be made available for local agriculture operations to incorporate into the soil, reducing the
demand for energy-intensive nutrient applications to crops which can end up contaminating both ground
and surface waters and contribute to the dead zone in the Gulf of Mexico.
4
Describe any additional projects planned in the next five years with cost estimates. If a capital
improvement plan is available, please attach the relevant sections.
Upgrades to the WPCP are just one part of Dubuque's commitment to improving water quality.
Concurrent to the planned upgrades at the WPCP, the City of Dubuque will also be working to restore the
Upper and Lower Bee Branch Creek. This restoration will alleviate surface flooding and sanitary sewer
backups in parts of Dubuque and protect water quality in the Mississippi River. This will include
daylighting buried portions of the stream and returning the creek to a more natural state with meanders
and natural vegetation along the banks. This project is estimated to cost $30 million. The City is also
currently working to improve the distribution capacity on the city's west side to reduce the number of
sewer bypasses that have occurred into tributaries of the North Fork of Catfish Creek. Other, smaller,
systems maintenance projects are identified in the attached Capital Improvement Plan.
The applicant must enclose (or email) the following documentation with the completed application.
Attached Five year pro-forma showing revenue and expenses for system
See below Most recent financial statement ®Audited ^ Unaudited
(If your financial information is available online ou ma~just provide a link)
httn://www.citvofdubuque org/archives/93/CAFR%202008 pdf
The undersigned is duly authorized to apply for this grant on behalf of the Applicant. The Applicant
declares under penalty of law that all facts given and information attached are true and correct. The
Applicant authorizes IFA to verify all information.
Authorized Signature >~--_~----~_--., Date October 30.2009
Typed Name and Title Michael C. Van Milligen, City Manager
A lications are due in the IFA office by 4.30 a m on Fridav, October 30, 2009
Applications should be addressed to: Lori Beary
Community Development Director
Iowa Finance Authority
2015 Grand Avenue
Des Moines, IA 50312
515-725-4965 (direct)
515-725-4901 (fax)
lori.bearv cr,iowa.gov
5
MINORITY IMPACT STATEMENT
Pursuant to 2008 Iowa Acts, HF 2393, Iowa Code Section 8.11, all grant applications submitted to the
state of Iowa that are due beginning January 1, 2009 shall include a Minority Impact Statement. This is
the state's mechanism for requiring grant applicants to consider the potential impact of the grant project's
proposed programs or policies on minority groups.
Please choose the statement(s) that pertains to the grant application. Complete all the information
requested for the chosen statement(s).
® The proposed grant projects programs or policies could have a disproportionate or unique osu itive
impact on minority persons. Describe the positive impact expected from this project:
It has long been documented that traditional fossil fuel-based power plants have a disproportionately large
impact on minority communities, who tend to live closer to these large facilities and therefore suffer
greater health impacts. This project will have positive impacts on minority persons locally, regionally and
nationally. By using anaerobic digestion to generate power at the WPCP Dubuque will be displacing
demand for coal-based power and reducing health impacts on minority communities who live near these
coal-fired power plants. Dubuque's coal-fired power plant is located near low-income neighborhoods
with some of the highest concentrations of minorities in the city. Also, minorities in the Mississippi River
basin are more likely to be dependent upon fish from the Mississippi River as their primary source of
protein and cleaner water will likely mean healthier fish. Reducing reliance on coal-fired power plants,
too, will reduce the mercury contamination in the fish upon which many people downstream and
downwind of the power plant depend.
Indicate which group is impacted:
^ Women ^ Persons with a Disability ^ Asians
Blacks DAmerican Indians ^ Alaskan Native Americans
Latinos ^ Pacific Islanders ^ Other
^ The proposed grant project programs or policies could have a disproportionate or unique negative
impact on minority persons. Describe the negative impact expected from this project:
Present the rationale for the existence of the proposed program or policy:
Provide evidence of consultation with representatives of the minority groups impacted:
Indicate which group is impacted:
^ Women ^ Persons with a Disability ^ Asians
^ Blacks ^ American Indians ^ Alaskan Native Americans
^ Latinos ^ Pacific Islanders ^ Other
^ The proposed grant project programs or policies are not expected to have a disproportionate or unique
impact on minority persons. Present the rationale for determining no impact:
I hereby certify that the information on this form is complete and accurate, to the best of my knowledge:
Mic ael C. Van Milligen
Typed Name Signature
Summary Statement of Revenue and Expenditures for System
Water Pollution Control Plant
REVENUES ') vaare grin T ~~+ Ve.,« n......__~ v____ ,.,
Residential
2,171,814
2,411,095 __~ ~.,~.
2,522,981 ~.~~~ ~ oal
2,699,590 ~ r~ ir~m now
2,861
565
Commercial 1,709,726 1,898,096 1,986,177 2,125,209 ,
2,252,722
Industrial 739,340 820,798 858,887 919,009 974
150
Deferred Charges ,
Other- Ex lain
TOTAL REVENUES: $ 4,620,880 $ 5,129,989 $ 5,368,045 $ 5,743,808 $ 6,088,437
EXPENnTTr rR F.c
Operation and
Maintenance 3,755,170 3,629,642 4,139,465 4,188,492 4,199,066
Depreciation and
Amortization 959,249 1,014,456 1,561,456 1,386,720 1,578,220
Other- Ex lain
TOTAL
EXPENDITURES: $ 4,714,419 $ 4,644,098 $ 5,700,921 $ 5,575,212 $ 5,777.286
NET OPERATING
INCOME: $ (93,539) $_ 485,891_ $ (332,876) $ 168,596 $ 333,151
OTHER INCOME:
Interest
Other: O er. fund interest 17,520 23,631 22,000 22,000 22.000
TOTAL OPERATING
AND OTHER
INCOME: $ 76 019 $ _509.522 $ 310 876 $ 190.596 $ 333,151
INCOME DEDUCTIONS:
Interest on debt 115,736 115,736
Debt Retired 125,000 125,000
Other- Explain
NET INCOME: $ 76 019 $ 509,522 $ (310,8762 $ 50 140 $ 92,415
RETAINED EARNINGS:
Beginning of Year: $ 185,254 $ 109,235 $ 618.757 $_ 307,881 $ 247.741
Ending of Year: $ 109,235 - $ _ 618,757 $ 307,881 $_ 247.741 $ 350,156