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MetropolitanWastewaterManagementCommissionCapitalImprovementProgram <br />CapitalProgramFundingandFinancialPlanningMethodsandPolicies <br />ThisannualbudgetdocumentpresentstheFY12-13CIPbudget,theFY12-13AMCPbudget, <br />and5-yearCapitalPlanwhichincludestheCIPandAMCPCapitalPlan.TheMWMCCapital <br />Programfinancialplanningandfundingmethodsareinaccordancewiththefinancial <br />managementpoliciesputforthintheMWMC2005FinancialManagementPlan. <br />EachofthetwoRWPcapitalprogramsreliesonfundingmechanismstoachieveRWPobjectives <br />describedabove.TheCIPisfundedprimarilythroughproceedsfromrevenuebondsales,system <br />developmentcharges,andtransfersfromtheOperatingFundtoCapitalReserves.TheAMCPis <br />fundedthroughwastewateruserfees. <br />Inadditiontorevenuebondsales,projectfinancingforcertainCIPprojectswasalsosecured <br />throughtheCleanWaterStateRevolvingFund(CWSRF)loanprogramforqualifiedprojects. <br />TheMWMCenteredintoCWSRFloanagreementswiththeStateofOregonDepartmentof <br />EnvironmentalQuality(DEQ)in2008,2009,and2010thatallowtheMWMCtoborrowupto <br />$20.8million. <br />ThroughtheCWSRFloanprogram,loansupto$8,000,000,$7,500,000,and$4,000,000were <br />approvedforTertiaryFiltration—Phase1,OdorousAirTreatment—Phase1,andPrimarySludge <br />Thickeningprojects,respectively.Additionally,$1,279,200inCWSRFfinancingwasapproved <br />fortheMWMCforCIPplanningefforts. <br />Ofthe$8,000,000providedthroughtheTertiaryFiltrationprojectloan,$450,000iscurrently <br />allocatedforriparianshadetreeplantingprojectstohelpaddresstheMWMC’spendingthermal <br />loadobligations.Thefinancingofthesewatershed-basedprojectsismadeavailablethroughthe <br />CWSRFprogramSponsorshipOption,whichprovidesfundingtotheborrowertoaddress <br />nonpointsourcewaterqualitysolutionsthroughareducedinterestrate.Theinterestrate <br />reductionallowstheMWMCtoinvestinwatershedimprovementsusingmoneythatwouldhave <br />otherwisebeenpaidasinterestontheloan. <br />Ofthe$7,500,000approvedloanfundingfortheOdorousAirTreatment—Phase1project, <br />$4,000,000wasfundedthroughtheAmericanReinvestmentandRecoveryAct(ARRA,or <br />“Stimulus”).Thisfundingwaspartofthefederalgovernment’seconomicstimulusprogram, <br />withloansissuedunderfavorableconditionstostimulateinfrastructureandcapitalproject <br />investment.TheARRAfundingagreementprovided50%oftheloaninforgivenprincipal,and <br />theremaining50%ofprincipalpaymentbearing0%interest.Thisresultedin$2,000,000ofnet <br />revenuetotheCIPinadditiontointerestsavings. <br />TheRWP’soperatingfundismaintainedtopayforoperations,administration,debtservice, <br />equipmentreplacementcontributionsandcapitalcontributionsassociatedwiththeRWP.The <br />operatingfundderivesthemajorityofitsrevenuefromregionalwastewateruserfeesthatare <br />collectedbytheCityofEugeneandCityofSpringfieldfromtheirrespectivecustomers.In <br />accordancewiththeMWMC2005FinancialPlan,fundsremaininginexcessofbudgeted <br />operationalexpenditurescanbetransferredfromtheoperatingfundtotheCapitalReservefund. <br />Page38PreliminaryFY12-13BUDGETANDCIP <br />