Dubuque Metropolitan Solid Waste Agency (DMASWA) Financing Plan Copyright 2014
City of Dubuque Action Items # 1.
ITEM TITLE: Dubuque Metropolitan Solid Waste Agency (DMASWA) Financing Plan
SUMMARY: City Manager recommending authorization for the Dubuque Metropolitan
Area Solid Waste Agency (DMASWA) to borrow money and endorse the
financing plan for its Cells #448 closure and Cell #9 Phase II construction
projects.
RESOLUTION Consenting to Financing Plan for Dubuque Metropolitan
Area Solid Waste Agency
SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Adopt Resolution(s)
ATTACHMENTS:
Description Type
❑ Endorsement of DMASWA Financing Plan-MVM Memo City Manager Memo
❑ Staff Memo Staff Memo
❑ Recommended Financing Plan Supporting Documentation
❑ Review of Proposed Project Funding Sources Supporting Documentation
❑ AECOM Engineers Estimate Supporting Documentation
❑ Resolution Resolutions
RESOLUTION NO. 350-14
RESOLUTION CONSENTING TO FINANCING PLAN FOR DUBUQUE METROPOLITAN
AREA SOLID WASTE AGENCY
WHEREAS, the Board of Supervisors of Dubuque County, Iowa (the "County") and the
City Council of the City of Dubuque, Iowa (the "City") have authorized and executed a certain
Intergovernmental Agreement Creating the Dubuque Metropolitan Area Solid Waste Agency
(the "28E Agreement") pursuant to Chapter 28E of the Code of Iowa; and
WHEREAS, the terms of the 28E Agreement provide for the creation of the Dubuque
Metropolitan Area Solid Waste Agency (the "Agency") for the purposes of providing for the
economic transport, processing, and disposal of all solid waste produced within the
metropolitan area of the Agency; and
WHEREAS, the Agency has authority pursuant to the 28E Agreement and Chapter 28F of
the Code of Iowa to issue revenue bonds and interim financing notes to pay the costs of
projects undertaken by the Agency; and
WHEREAS, the Agency has proposed to undertake the CeII 9 Phase II CeII Construction
and CeII 4-8 Closure Project (the "Project"); and
WHEREAS, D.A. Davidson, the Agency's Financial Advisor (the "Financial Advisor"), has
prepared a financing plan (the "Financing Plan") for the funding of the Project; and
WHEREAS, the Financing Plan includes: (1) the issuance by the Agency of Landfill
Facility Revenue Bonds (the "Revenue Bonds") in a principal amount not to exceed
$3,500,000; (2) the issuance by the County of General Obligation Landfill Facility Bonds (the
"General Obligation Bonds") in a principal amount not to exceed $4,500,000; and (3) the
execution of a revenue disbursement agreement (the "Revenue Agreement") between the
Agency and the County covering revenue payments by the Agency to the County in an
amount equal to the principal and interest to be paid on the General Obligation Bonds, plus
reasonable administrative fees to compensate the County for its issuance and maintenance
of those Bonds; and
WHEREAS, it is now necessary for the City Council of the City (the "Council") to take
action to approve the Financing Plan, the issuance of the Revenue Bonds, the issuance of
the General Obligation Bonds and the execution of the Revenue Agreement;
NOW, THEREFORE, It Is Hereby Resolved by the City Council of the City of Dubuque,
Iowa, as follows:
Section 1. The City hereby approves the undertaking of the Project and the Financing Plan
as prepared and presented by the Financial Advisor.
Section 2. The Agency's issuance of the Revenue Bonds, as described in the Financing
Plan and the preamble hereof, is hereby approved pursuant to Chapter 28F of the Code of
Iowa.
DORSEY & WHITNEY LLP, ATTORNEYS, DES MOINES, IOWA
Section 3. The County's issuance of the General Obligation Bonds, as described in the
Financing Plan and the preamble hereof, is hereby acknowledged and approved.
Section 4. The execution by the Agency of the Revenue Agreement, as described in the
Financing Plan and the preamble hereof, is hereby approved pursuant to Chapter 28F of the
Code of Iowa. The Agency's fulfillment of its payment obligations to the County under the
Revenue Agreement is hereby approved.
Section 5. All resolutions or parts thereof in conflict herewith be and the same are hereby
repealed to the extent of such conflict.
Passed and approved this 3rd day of November, 2014.
CITY OF DUBUQUE, IOWA
Y
Karla A. Braig, Mayor Pro Tem
Attest:
Kevin ` Firnstahl, ity -t "k
DORSEY & WHITNEY LLP, ATTORNEYS, DES MOINES, IOWA
THE CITY OF Dubuque
U E I
erica .i
Masterpiece on the Mississippi 2007-2012-2013
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Endorsement of Dubuque Metropolitan Area Solid Waste Agency
(DMASWA) Financing Plan
DATE: October 27, 2014
Public Works Director Don Vogt is recommending City Council authorization for the
Dubuque Metropolitan Area Solid Waste Agency (DMASWA) to borrow money and
endorse the financing plan for its Cells #448 closure and Cell #9 Phase II construction
projects.
The Dubuque Metropolitan Area Solid Waste Agency is an intergovernmental agency
formed under Iowa Chapter 28E. The agreement entered into by the City and County of
Dubuque in 1975 is to manage the solid waste needs for Dubuque county. The agency
contracts with the City of Dubuque for operational service. The DMASWA now requires
a significant upfront investment for the Cells #4 - #8 closure and the Cell #9 Phase II
construction projects. The attached AECOM engineer's estimate for the combined
projects is $6.78 million.
Direct borrowing and revenue bonds are the two generally-accepted methods to secure
needed funding by 28E agencies. General obligation (G.O.) bonding is only available to
the Agency through a governmental body with taxing authority. The State Revolving
Fund Non-Point Source Program (SRF) was subsequently identified as another possible
funding source. The Agency's goal is to secure project financing at the lowest cost
without overexposure to the DMASWA and its two owner-partners, the City and County
of Dubuque.
After evaluating all the options available, the recommended plan is to leverage the SRF
for the Cells #4 - #8 closure portion of the project and fund the Cell #9 Phase 11
construction project through G.O. bonds backed by the County. The SRF portion will
secure a low interest rate for revenue bonds backed by the Iowa Finance Authority
without affecting the borrowing capacity of either the City or County.
G.O. bonds were selected over solid waste revenue bonds for the Cell #9 Phase II
construction project because of the lower interest rate available and lower risk to the
buyers. This option will, however, impact the debt capacity of the sponsoring
organization. During discussions with City and County representatives, the County was
identified as having greater debt capacity than the City. If approved by the Board of
Supervisors, the G.O. bond debt would be carried by the County and the Agency would
make the payments.
The DMASWA requires authorization to borrow monies from the Dubuque County Board
of Supervisors and the Dubuque City Council. If approved by both the City Council and
the Board of Supervisors on November 3rd, the DMASWA will then proceed to solicit a
not to exceed amount of$3,500,000 from the SRF for the cells closure project and a not
to exceed amount of$4,500,000 through the G.O. bonding process with the County for
the Cell #9 Phase II project.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
114.14 ..
Mic ael C. Van Milligen'—� s
MCVM:sv
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
Don Vogt, Public Works Director
2
Dubuque
THE CITY OF
DUB E If
Masterpiece on the Mississippi •��•�
TO: Michael C. Van Milligen, City Manager
FROM: Don Vogt, Public Works Director D7V
SUBJECT: Endorsement of DMASWA Financing Plan
DATE: October 23, 2014
INTRODUCTION
The purposes of this memorandum are to provide information and request the City
Council's authorization for the Dubuque Metropolitan Area Solid Waste Agency
(DMASWA) to borrow money and endorse the financing plan for its Cells #4 - #8 closure
and Cell #9 Phase II construction projects.
BACKGROUND
The Dubuque Metropolitan Area Solid Waste Agency is an intergovernmental agency
formed under Iowa Chapter 28E. The agreement entered into by the City and County of
Dubuque in 1975 is to manage the solid waste needs for Dubuque county. The
DMASWA now requires a significant upfront investment for the Cells#4 - #8 closure
and the Cell #9 Phase II construction projects. At this time, this infrastructure
expenditure causes near term financial instability for the Agency. To fully identify and
evaluate its project financing options, DMASWA hired a financial advisory firm to assist
staff in this decision. The attached AECOM engineer's estimate for the combined
projects is $6.78 million.
DISCUSSION
In August, D.A. Davidson was retained by the DMASWA Board of Directors, with input
from City of Dubuque Budget Director Jennifer Larson and Dubuque County Budget
Director Michelle Patzner. D.A. Davidson confirmed 28E organizations have the
authority to borrow monies under Iowa Code Chapter 28F.3 only with the permission
from the governmental bodies entered into the agreement. This restriction is also stated
in the Agency's 28E agreement.
Direct borrowing and revenue bonds are the two generally-accepted methods to secure
needed funding by 28E agencies. General obligation (GO) bonding is only available to
the Agency through a governmental body with taxing authority. The State Revolving
Fund Non-Point Source Program (SRF) was subsequently identified by D.A. Davidson
and staff as another possible funding source. In any case, the Agency's goal is to
secure project financing at the lowest cost without overexposure to the DMASWA and
its two owner-partners, the City and County of Dubuque.
After evaluating all the options available, the recommended plan is to leverage the SRF
for the Cells #4 - #8 closure portion of the project and fund the Cell #9 Phase II
construction project through G.O. bonds backed by the County. The SRF portion will
secure a low interest rate for revenue bonds backed by the Iowa Finance Authority
without affecting the borrowing capacity of either the City or County.
G.O. bonds were selected over solid waste revenue bonds for the Cell #9 Phase II
construction project because of the lower interest rate available and lower risk to the
buyers. This option will, however, impact the debt capacity of the sponsoring
organization. During discussions with City and County representatives, the County was
identified as having greater debt capacity than the City. If approved by the Board of
Supervisors, the G.O. bond debt would be carried by the County and the Agency would
make payments to it. Attached is D.A. Davidson's memorandum outlining its
recommendation and proposed borrowing schedule. Davidson's Michael Maloney and
Chip Schultz will be present at the November 3rd meeting to present the issue and
answer questions Council members may have.
To move forward under 28F.3, the DMASWA requires authorization to borrow monies
from the Dubuque County Board of Supervisors and the Dubuque City Council. Council
affirmation will be through approval of the attached resolution. This resolution was
prepared by the Agency's bond counsel, Dorsey and Whitney LLP, and reviewed and
approved by City Attorney Barry Lindahl. If approved by both the City Council and the
Board of Supervisors on November 3rd, the DMASWA will then proceed to solicit a not
to exceed amount of$3,500,000 from the SRF for the cells closure project and a not to
exceed amount of$4,500,000 through the G.O. bonding process with the County for the
Cell #9 Phase II project.
ACTION STEP
The attached resolution authorizing the DMASWA to borrow monies and endorsing its
financing plan is submitted for your consideration and subsequent approval by the City
Council.
CC: Barry Lindahl, City Attorney
Jennifer Larson, Budget Director
Attachments
2
ON.
DIA DAVIDSON
FIXED INCOME CXPII�l AFFE11
Memorandum
To: John Foster,Solid Waste Agency Administrator, Dubuque Metropolitan Area Solid Waste Agency
Dubuque Metropolitan Area Solid Waste Agency Board
From: Chip Schultz, Managing Director- D.A. Davidson &Co.
Telephone: 515.471.2720 Email:chio.schultzC@dadco.com
Michael Maloney,Vice President—D.A. Davidson &Co.
Telephone: 515.471.2723 Email: mmalonevC@dadco.com
Date: Friday, October 24th, 2014
Re: Recommended Financing Plan for Dubuque Metropolitan Area Solid Waste Agency Capital Needs
The purpose of this correspondence is to summarize Davidson's recommended financing plan for the
Dubuque Metropolitan Area Solid Waste Agency. Capital needs for the Agency include cell closures and
new cell openings and the Agency and its consultants have identified two near term projects. In 2015,
the Agency plans closure of cells 4-8 as well as Phase II of cell 9 to add three years of life to the landfill.
The total capital project costs identified total $6.781 million, which covers construction and engineering
only. Bond issuance costs would need to be added to this amount.The Agency plans to secure financing
by the end of 2014 to allow for bids in early 2015. The Agency will repay any debt associated with these
capital projects solely from landfill operations revenues.
These projects have potential to be financed in part through the Iowa Finance Authority's Non-point
Source State Revolving Fund Program ("SRF"). As the Agency's financial advisor, Davidson recommends
that the Agency maximize the amount of SRF borrowing as it will be the most cost-effective financing
option. The current rate for the Non-point Source SRF program is 1.75% up to 20 years. At this time,
the Agency's consulting engineer has prepared detailed estimates related to both projects that identify
$2.972 million in project costs as related Non-point Source eligible. This amount and the related capital
expenditure line items are subject to approval from the Iowa Finance Authority.
The Agency can directly issue the SRF loan as revenue bonds pursuant to Section 28F of the Iowa Code,
subject to approval by the City and County(as members of the 28E agreement) per Section 28F.3 by
adopting a resolution approving the planned issuance. At this time, we would recommend that the
Agency requests that the City and County consider adopting a resolution approving the Agency's plan to
issue not-to-exceed $3,500,000 Landfill Facility Revenue Bonds via the SRF Non-point Source program.
The remaining portion of the capital projects total $3.809 million. Davidson recommends that the
Agency pursue financing via General Obligation Bonds issued by Dubuque County. The Agency and
County would sign a disbursement agreement that states that the Agency would use landfill operations
revenues to repay the County for semi-annual debt service payments. All County costs related to the
proposed General Obligation Bonds will be reimbursed by the Agency. The County General Obligation
Bonds would be tax-exempt, bank-qualified obligations, providing the lowest cost of financing outside of
the SRF program as the debt would be secured by the ad valorem property tax pledge of the County
(although the debt would be repaid solely from the Agency's revenues).
At this time, we recommend that the Agency request the City and County consider adopting a resolution
approving this financing plan that would include the County issuing a General Obligation Bond not-to-
exceed $4,500,000 repaid by Agency revenues subject to a disbursement agreement with the County.
Des Moines Office
515 East Locust Street,Suite 200 1 Des Moines,Iowa 50309 1515.471.2700 1800.642.5082 1 FAX 515.471.2702
davidsoncompanies.com/ficm
Dubuque Metropolitan Area Solid Waste Agency EXHIBIT 1
Projects:(1)Cell 9,Phase II Construction(2)and Closure of Cells 4-8
Review of Proposed Project Funding Sources
SRF Eligble . .. . .t SRF Eligble-County General Obligation :.
Project:Closure of Cells 4-8 Project:Cell 9,Phase 11 Construction
Background on Not-to-exceed Calculation Background on Not-to-exceed Calculation
1 Project Cost Estimate from Engineer(Construction and Engineering) $2,972,887 1 Project Cost Estimate from Engineer(Construction and Engineering) $3,808,803
2 Allowance for Cost Volatility 250,000 2 Allowance for Cost Volatility 250,000
3 Subtotal 3,222,887 3 Subtotal 4,058,803
4 go n ded u p to n ea rest$5,000 3,225,000 4 Rounded up to nearest$5,000 4,060,000
5 Estimated Issuance Expenses 35,000 5 Estimated Issuance Expenses 110,000
6 Total Projected ParAmount 3,260,000 6 Total Projected ParAmount 4,170,000
7 Additional Contingency(7%) 228,200 7 Additional Contingency(7%) 291,900
8 Subtotal 3,488,200 8 Subtotal 4,461,900
9 Rounded up to nearest$50,000 $305000000 9 Rounded up to nearest$50,000 $405000000
DIAIDAVIDSON
FIXED INCOME CAPITAL MARKETS
Prepared by D.A.Davidson Co. Page 1 of 1 Date Prepared:10/23/2014
Engineers Estimate
Dubuque Combined Construction - Cell 9 Phase II & Cell 4-8 Clousure A=M
Dubuque Metropolitan Area Solid Waste Agency
Dubuque, Iowa
AECOM Project No: 60313147
October 22, 2014
Engineers Estimate
Item Description Unit Estimated Unit Price Total Price
Quantic
Cell 4b Closure
1 Mobilization and Demobilization LS 1.0 $ 100,00000 $ 100,00000
2 Site Preparation LS 1.0 $ 10,00000 $ 10,00000
3 Topsoil Strip and Stockpile CV 28300.0 $ 200 $ 56,60000
4 Common Excavation CV 258 300 0 $ 300 $ 77490000
5 Grading Layer-Excavate, Haul and Place-NO COMPACTION CV 25,000.0 $ 250 $ 62 500 00
6 Cover ClaV-Excavate,Haul and Place CV 20300.0 $ 475 $ 96,42500
7 Rooting Zone-Excavate,Haul and Place-NO COMPACTION CV 130,8000 $ 250 $ 32],00000
8 CoverTo soil-Excavate,Haul and Place CV 28,720.0 $ 200 $ 57,44000
9 Existing Waste Relocation CV 16200.0 $ 800 $ 129,60000
10 Diversion Bern Construction LF 4,900.0 $ 800 $ 39 200 00
11 60 mil HDPE Textured Liner SV 30,400.0 $ 500 $ 152,00000
12 Geocomposite Drainage Layer SV 30,400.0 $ 450 $ 136,80000
13 Settlement Plates EA 7.0 $ 20000 $ 1,40000
14 Data Legg Brand Pi A,om eter T ran sat Nor EA 6.0 T 4,00000 24,000 00
15 Data Logger Installation EA 6.0 7 1,00000 6,00000
16 18-Inch CMP Dovvnslo eFlume LF 1,625.0 3345 7 5435625
17 18-Inch CMP Apron EA 5.0 $ 260 00 $ 1300 00
18 18-Inch Lateral Inlet EA 5.0 $ 50000 $ 2 500 00
19 24-Inch CMP Culvert LF 635.0 $ 50 00 $ 31 750 00
20 24-Inch CMP Apron EA 5.0 $ 1 500 00 $ 7 500 00
21 Surface Intake EA 5.0 $ 5,00000 $ 25,00000
22 Erosion Blanket SV 15,000.0 $ 460 $ 69,00000
23 Class DRi ra over Geotextile TONS 50.0 $ 25000 $ 12 500 00
24 6-INCH THICK MACADAM STONE BASE SV 4,800.0 $ 600 $ 28,80000
25 9-INCH THICK CLASS A CRUSHED STONE SV 4,800.0 $ 800 $ 38,40000
26 Geogdd SV 4,800.0 $ 350 $ 16,80000
27 Mulching AC 617 $ 80000 $ 49 360 00
28 Prairie Grass Mix AC 53.0 $ 2,00000 $ 106,00000
29 RURAL MIX FERTILIZING AND SEEDING AC 87 $ 80000 $ 6 960 00
30 STABILIZATION MIX FERTILIZING AND SEEDING AC 87 $ 80000 $ 6 960 00
31 Silt Fence LF 7,280.0 $ 200 $ 14 560 00
32 Silt Fence Removal LF 7,280.0 $ 100 $ 7 280 00
33 Clean Silt Fence LF 7,280.0 $ 100 $ 7 280 00
34 Remove Salvage and Repair 16Chain Link Fence LF 656.0 $ 2000 $ 13,12000
35 Install Signs LS 1.0 $ 10,00000 $ 10,00000
36 Remove Field Fence LF 4,723.0 $ 200 $ 9,44600
37 Clear and Grub Trees LS 1.0 $ 5,00000 $ 5,00000
CeII9 Phase II
38 GROUNDWATER COLLECTION LAVER CV 19500.0 $ 2400 $ 468,00000
39 EARTH BARRIER LAVER CV 19900.0 $ 3 00 $ 59 700 00
40 CLAY BARRIER LAVER CV 36700.0 $ 475 $ 17432500
41 ILEACHATE DRAINAGE LAYER CY 18900.0 $ 5000 $ 945,00000
42 COARSE AGGREGATE CY 3195.0 $ 5100 $ 16294500
43 4FOOT WIDE PHASE BERM CY 2,000.0 $ 800 $ 16,00000
44 160Z.CUSHION GEOTEXTILE SY 12,175.0 $ 300 $ 36 525 00
45 80Z.SEPARATION GEOTEXTILE SY 119 500 0 $ 170 $ 203,15000
46 60-MIL TEXTURED HDPE LINER SY 58950.0 $ 500 $ 29475000
47 12-INCH PERFORATED GROUNDWATER COLLECTION PIPE LF 3150.0 $ 4000 $ 126,00000
48 12-INCH PERFORATED LEACHATE COLLECTION PIPE LF 3,950.0 $ 4000 $ 158,00000
49 12-INCH SIDESLOPE RISER CLEANOUT PIPE LF 1,808.0 $ 4500 $ 81 360 00
50 8-INCH ANTI-SEEP COLLAR EA 2.0 $ 78000 $ 1 560 00
51 18-INCH CMP RISER ENCASEMENT PIPE LF 100.0 $ 50 00 $ 5,000 00
52 8-INCH GROUND WATER PIEZOMETER LF 259.0 $ 2800 $ 7 252 00
53 8-INCH LEACHATE PIEZOMETER LF 198.0 $ 2800 $ 5 544 00
54 GUARD POSTS EA 40.0 $ 24000 $ 9,60000
55 6-INCH THICK MACADAM STONE BASE SY 11950.0 $ 600 $ 71 700 00
56 9-INCH THICK CLASSA CRUSHED STONE SY 12,080.0 $ 800 $ 96,64000
57 12-INCH THICK CLASS D REVETMENT SY 2,491.0 $ 4500 $ 112,09500
58 12-INCH THICK EROSION STONE SY 126.0 $ 4500 $ 5,67000
59 18-INCH RCP CULVERT LF 442.0 $ 4000 $ 17,68000
60 18-INCH RCP APRON EA 16.0 $ 80000 $ 12,80000
61 8-Foot Chain Link Fence LF 1,650.0 $ 1800 $ 29 700 00
62 Chain Link Passage Gate EA 6.0 $ 50000 $ 3,00000
63 1 6-Foot Chain Link Fence LF 3,600.0 $ 3600 $ 129,60000
Cell 4b Closure Design Cost $ 88,000.00
Cell Phase II Design Cost $ 74,000.00
Cell 4b Closure Construction Subtotal $ 2,497,73725
10%Bid Price Contingency $ 249 773 73
Cell 4b Closure Project Percentage and Construction Total 43.589/. $ 2,747,510.98
Cell 9 Phase II Construction Subtotal $ 3,233 596 00
10%Bid Price Contingency $ 323359 60
Cell 9 Phase 11 Project Percentage and Construction Total 56.42% $ 3,556,955.60
Froject construction o a $ 6,304,466.58
Project QA/QCs°,t ofProect Total Assumi mo const $ 315 223 33
Cell 4b Closure CRS based on Project Percentage $ 137,375.55
Cell Phase 11 Subtotal based on Project Percentage 1 $ 177,847.78
Cell 4b Closure Project Total $ 2,972,886.52
Cell Phase 11 Project Total $ 3,808,803.38
Project Total $ 6,781,689.90
MINUTES TO ADOPT RESOLUTION
CONSENTING TO FINANCING PLAN OF
DUBUQUE METROPOLITAN AREA SOLID
WASTE AGENCY
Dubuque, Iowa
November 4, 2014
The City Council of the City of Dubuque, Iowa, met on Monday, November 3, 2014, at
6:30 o'clock p.m., at the Historic Federal Building, 350 W. 6th St. in the City. The Mayor Pro
Tem presided and the roll was called showing the following Council Members present and
absent:
Council Member
Present: Mayer 149-; m -Karla A. Braig; Council Members Joyce Connors, Ric Jones,
Kevin Lynch, David Resnick, Lynn Sutton ; Mayor Roy D. Buol
• • Other Business • •
Council Member Jones introduced a resolution hereinafter next
set out and moved its adoption, seconded by Council Member Resnick ; and
after due consideration thereof by the Council, the Mayor put the question upon the adoption
of the said resolution and the roll being called, the following named Council Members voted:
Ayes: Braig, Buol, Connors, Jones, Lynch, Resnick, Sutton
Nays:
Whereupon, the Mayor Pro Tcm declared the resolution duly adopted as follows:
• • Other Business • •
On motion and vote the meeting adjourned.
Attest:
Ke' S. Firnstahl,
Clerk
lc>) / 7
Karla A. Braig, Mayor Pro Tier
�.J
DORSEY & WHITNEY LLP, ATTORNEYS, DES MOINES, IOWA