CC Minutes - 02/09/05 WS - Laserfiche WebLink

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B. WORK SESSION: Modifications to the Metropolitan Wastewater Management Commission Intergovernmental Agreement The council was joined by Peter Ruffler of the Wastewater Division and Jerry Lidz of the City Attorney's Office. Mr. Ruffler introduced Susie Smith, General Manager of the Metropolitan Wastewater Manage- ment Commission (MWMC), Bob Duey, Chief Financial Officer of the MWMC, and Dave Jewett, legal counsel for the MWMC. He said that the council was not being asked to take action on the item today. He apologized that the Intergovernmental Agreement (IGA) was not available, noting that it had undergone several revisions since it was presented to the commission and staff still did not have a final working draft. He said staff still believed it was worth having the work session so the council could raise questions and provide staff with revisions it would like to see to the IGA. Mr. Ruffler provided background on the formation of the MWMC, which was created through an IGA between Eugene, Lane County, and Springfield. Mr. Ruffler indicated the modifications to the IGA being proposed now were relatively straightforward, mirroring current operations and practices, and would not change relationships between the parties to the IGA. They would result in an agreement more aligned with current administrative and operational practices and more consistent with regional policies and procedures. Mr. Ruffler said the most controversial changes were those related to the recommendations received from financial advisors and bond counsel and the implementation of the capital improvements projects list, which was estimated to be $144 million over a 20-year period. Most of those costs were front-loaded over the first five to ten years of the planning period. Consistent with financial planning criteria and conditions in the IGA, the MWMC proposed to supplement the funding for those improvements by issuing revenue bonds. Mr. Ruffler said that when the MWMC was first formed it did not have statutory authority to issue revenue bonds, and construction of the original treatment facility was handled by the County Service District. Those bonds were retired in 1997, and the commission is currently debt-free. The changes being proposed were necessary to reflect the changes in the authorities to allow the MWMC to issue revenue bonds. Mr. Ruffler said in preparation for the financing necessary for the facilities plan, the commission hired a financial planner to review the underlying documentation and IGA; that planner recommended some changes to the IGA. Subsequent reviews by the County's financial planner and City's bond counsel also indicated a need for further changes before revenue bonds could be issued by the MWMC. Those recommendations were yet to be reconciled. That was the stage of the process the IGA was at now. Mr. Lidz discussed why the council was considering the IGA at this time, when in the past it was amended by the City Manager. Mr. Lidz said the revisions that the council would see involve the council's commitment on behalf of the City to perform certain acts in the future, such as setting user rates and systems development charges (SDCs). The manager could not make those commitments. Mr. Lidz provided additional background on the issue. He said the discussions that had occurred to this point involved balancing the requirements for access to the bond market with retention of as much governing body authority as was consistent with that access. He said that the bond counsel and bond market state that MINUTES--Eugene City Council February 9, 2005 Page 4 Work Session