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INDIO WATER AU THORITYAGENDA REPORTMarch 15 2004

TO: resident and CommissionersTHRU: om Ramirez, Executive Director K UFROM: erry Carter, TreasurerSUBJECT: ater Enterprise Revenue Bonds, 2004 Series

SUMMARYThe City leased its Water System to the Indio Water Authority under a LeaseAgreement dated May 22, 2001. The first lease payment was 10,000,000, of which5,000,000 was initially paid to the City and used for street reconstruction. Thebalance of the first lease payment is secured by a Promissory Note, The Authority hasmade monthly payments of 32,215 under the Promissory Note, which currently hasan outstanding balance of 4,783,732. The Authority also pays the City annual rent.The City now desires that the balance of the Promissory Note be paid so that thestreet reconstruction program can continue.In addition, the Water System requires the construction of a 10MG reservoir and theacquisition of additional wells. The cost of the reservoir and wells is estimated at5,000,000.

PREVIOUS BOARD ACTION: NoneANALYSIS:For the fiscal year ending June 30, 2003, the Indio Water Authority produced netincome of 2,529,000, which included 1,556,000 of connection fees. The Authority'snet income can now support the debt service on revenue bonds issued to repay theCity's Promissory Note and to fund the reservoir construction and well acquisition.The City and Authority's financing team recommends that the Authority issue WaterEnterprise Revenue Bonds, secured by a pledge of net income from the Water

ITEM NO. 2

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IWA RESOLUTION NO. 2004-

RESOLUTION OF THE INDIO WATER AUTHORITY AUTHORIZINGTHE ISSUANCE AND DELIVERY OF ITS WATER ENTERPRISEREVENUE BONDS, 2004 SERIES, APPROVING A BOND PURCHASECONTRACT, AN INDENTURE OF TRUST, A CONTINUINGDISCLOSURE AGREEMENT, A PRELIMINARY OFFICIALSTATEMENT AND A FINAL OFFICIAL STATEMENT, ANDAUTHORIZING OFFICIAL ACTIONS AND EXECUTION OFDOCUMENTS RELATED THERETO

WHEREAS, the Indio Water Authority (the Authority ) has been formed pursuant to aJoint Exercise of Powers Agreement by and between the City of Indio (the City ) and theRedevelopment Agency of the City of Indio, and is authorized under said Agreement and underthe laws of the State of California to finance the acquisition and construction of public capitalimprovements for any of its members; and

WHEREAS, the Authority and the City have entered into a Lease (as amended by theFirst Amendment to Lease and the Second Amendment to Lease, the Lease ) pursuant to whichthe Authority has leased from the City the City's water system (the Enterprise ); and

WHEREAS, for the purpose of refinancing a Promissory Note issued for making a leasepayment under the Lease and financing certain capital improvements to the Enterprise, theAuthority has determined to issue its Water Enterprise Revenue Bonds, 2004 Series (theBonds );

NOW, THEREFORE, THE AUTHORITY COMMISSION DOES HEREBYRESOLVE AS FOLLOWS:

Section 1. The Authority hereby approves the issuance of its Water Enterprise RevenueBonds, 2004 Series.

Section 2. The Authority hereby approves the Indenture of Trust in substantially theform filed with the Secretary of the Commission. The President, the Vice President, theExecutive Director and the Treasurer (each, a Responsible Officer ), are hereby authorized toexecute the Indenture of Trust in substantially the form filed with the Secretary, with suchrevisions, amendments and completions as shall be approved by a Responsible Officer, with theadvice of Bond Counsel, such approval to be conclusively evidenced by the execution anddelivery thereof

Section 3. The Authority hereby approves the Continuing Disclosure Agreement insubstantially the form filed with the Secretary of the Commission. Any Responsible Officer ishereby authorized to execute the Continuing Disclosure Agreement in substantially the formfiled with the Secretary, with such revisions, amendments and completions as shall be approved

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by a Responsible Officer, with the advice of Bond Counsel, such approval to be conclusivelyevidenced by the exec ution and delivery thereofSection 4. The Authority hereby approves the Preliminary Official Statement relating to

the Bonds, substantially in the form filed with the Secretary of the Commission, with suchrevisions, amendments and completions as shall be approved by a Responsible Officer with theadvice of Bond and Disclosure Counsel, in order to make the Preliminary Official Statementfinal as of its date, except for the omission of certain information, as permitted by Section240.15c2-12(b)(1) of Title 17 of the Code of Federal Regulations ( Rule 15c2-12 ), and anycertificate relating to the finality of the Official Statement under Rule 15c2-12. A ResponsibleOfficer is authorized and directed to execute and deliver a final Official Statement andamendments and updates thereto, as appropriate, in substantially the form hereby approved, withsuch additions and changes as may be approved by Bond and Disclosure Counsel and theResponsible Officer executing the same, such approval to be conclusively evidenced by theexecution and delivery thereof

Section 5. The Authority hereby approves the Bond Purchase Contract in substantiallythe form filed with the Secretary of the Commission. Any Responsible Officer is herebyauthorized to execute the Bond Purchase Contract, in substantially the form filed with theSecretary, with such revisions, amendments and completions as shall be approved by aResponsible Officer, with the advice of Bond Counsel, such approval to be conclusivelyevidenced by the execution and delivery thereof; provided that, the Bond Purchase Contract shallprovide for a principal amount of Bonds not greater than $12,000,000, a maximum true interestcost on the Bonds not greater than 6% and an Underwriter's discount not greater than 1.5%.

Section 6. The President, the Executive Director, the Treasurer, the Secretary, and anyand all other officers of the Authority are hereby authorized and directed, for and in the nameand on behalf of the Authority, to do any and all things and take any and all actions, includingthe publication of any notices necessary or desirable in connection with the sale of the Bonds,procurement of a municipal bond insurance policy and reserve fund surety bond, and executionand delivery of any and all assignments, certificates, requisitions, agreements, notices, consents,instruments of conveyance, warrants and other documents, which they, or any of them, deemnecessary or advisable in order to consummate the lawful issuance and sale of the RefundingBonds and the consumm ation of the transactions as described herein.

Section 7. The Secretary shall certify to the adoption of this Resolution, which shall bein full force and effect immediately upon its adoption. Notwithstanding the foregoing, suchcertification and any of the other duties and responsibilities assigned to the Secretary pursuant tothis Resolution may be performed by an Assistant Secretary with the same force and effect as ifperformed by the S ecretary hereunder.

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PASSED, APPROVED AND ADOPTED this day of 2004, by thefollowing roll call vote:AYES:NOES:ABSENT:AB STAIN:

JACQUELINE BETHEL, PRESIDENT

ATTEST:

CYNTHIA HERNANDEZSecretary of the Authority

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I N I OCITY OF INDIO

AGENDA REPORTMeeting of March 15 2004

TO: onorable President and Commissioners of the Indio WaterAuthority

THRU: om Ramirez, Executive Director ti_tioFROM: ohn Corella, Director of Public Works/City Engineer

David Merrell, Principal Civil. EngineerpSUBJECT: Water Quality Laboratory Testing ServicesDATE: ebruary 19, 2004

SummaryStaff solicited cost proposals from qualified testing laboratories to perform waterquality tests for 17 well sites contained within the Indio Water Authority serviceboundary. The water quality testing parameters are extensive and must beaccomplished in accordance with both State of California Title 22 and FederalEnvironmental Protection Agency (EPA) regulations. A total of 2 bids werereceived. MWH Laboratories is the low bidder in the amount of $42,330.

BackgroundThe Indio Water Authority (IWA) recently requested detailed cost proposals forlaboratory services for the EPA Unregulated Contaminant Monitor Rule and theState of California Title 22 drinking water monitoring program. The Title 22testing regime is accomplished on a tri-annual basis (every 3-years) and coverstesting for an extensive number of mineral, organic and inorganic chemicalcompounds. The EPA Unregulated Contaminant Monitor Rule was recentlyenacted and requires all public water systems to monitor for 11 non-regulatedchemical contaminants. The purpose of the monitoring rule is to provide

ITEM NO 3

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LJerry Carter,iFinance Director

Agenda Report, City of IndioWater Quality Testing ServicesPage 2statistical data for EPA to deteimine if it is necessary to regulate these additionalcontaminants in the future. Under the EPA regulation, two rounds of testing willbe required, one in the spring and one in the fall, about 7 months apart.

Bid results are summarized as follows:MWH. Laboratories 42,330.00E.S. Babcock 45,317.75

Financial ImplicationsFunding for the water quality testing will be derived from the IWA WaterProduction Account.Reviewed and concurred:

RecommendationThe IWA staff is recommending that the IWA Board authorize the ExecutiveDirector to issue a purchase order to MWH Laboratories in the amount of$42,330.00 to perfolin water quality testing in accordance with the CaliforniaTitle 22 and Federal Unregulated Contaminate Monitoring Rule for the activewell sites.

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CITY OF INDIOAGENDA REPORT

Meeting of March 15, 2004

TO: onorable President and Commissioners of the Indio WaterAuthority

THRU: om Ramirez, Executive Director 4,--FROM: ohn Corella, Director of Public Works/City Engineer

David Merrell, Principal Civil Engineer 001 .--SUBJECT: Authorization to solicit engineering proposals for Gravity Water

Reservoir SystemDATE: arch 10, 2004

SummaryStaff is requesting authorization from the Commission for staff to solicitengineering proposals for a gravity water storage reservoir system for the watersystem servicing the City of Indio.BackgroundThe Indio Water Authority (IWA) staff is requesting authorization to solicitproposals for real estate, environmental and engineering consulting services toprovide a gravity water storage reservoir system to serve the IWA jurisdictionalboundary. The proposed system would replace the current hydropneumatic watersystem operational mode. The scope of services included in the solicitationprocess is summarized as follows:

Phase 1 Site Evaluation: the objective of Phase 1 work is todetermine the most feasible sites for a reservoir. Ultimately, it isplanned that two sites will be selected.

ITELi la 4

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Agenda Report, City of IndioAuthorization to Solicit Engineering Proposalsfor Gravity Water Reservoir SystemPage 2

Phase 2 Environmental: This phase of the project will involvepreparation of appropriate environmental as ssments ndoitsforthe two sites selected. . 2-1 ' ' --WPhase 3 Engineering Design Services: This phase of the workinvolves desigrrand preparation of plans, specifications and cost)estimates for the-two sites. The analysis will include considerationof three potential reservoir design approaches, namely 1) aboveground steel reservoir; 2) partiallyried concrete eservoir; and3) full buried concrete reservoir. - 7 7tu

Phase 4 Bidding and Construction: This phase involves providingsupport services during the bidding and construction phase of theproject. /11, i7 ?

Based on the current schedule, proposals will be due by April 7, 2004. Staff willsubsequently review the proposals and make a recommendation to award anengineering contract for the work at the next available IWA meeting in April.Financial ImplicationsFunding for the water quality testing yJi. be derived from the IWA Water CapitalImprovement FundReviewed and concurred:

Jeny ^ a e F ance DirectorRecommendationThe IWA staff is recommending that the IWA Board authorize staff to solicitproposals for engineering services for real estate, environmental and engineeringconsulting services to provide a gravity water storage reservoir system to servethe City of Indio service boundary.

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CITY OF INDIOAGENDA REPORT

Meeting of March 15, 2004

TO: onorable President and Commissioners of the Indio WaterAuthority

THRU: om Ramirez, Executive DirectorFROM: ohnohn Corella, Director of Public Works/City Engineer

David Merrell, Principal Civil Engineer / 0 4 . . - -SUBJECT: Authorization to solicit engineering proposals for Gravity Water

Reservoir SystemDATE: arch 10, 2004

SummaryStaff is requesting authorization from the Commission for staff to solicitengineering proposals for a gravity water storage reservoir system for the watersystem servicing the City of Indio.BackgroundThe Indio Water Authority (IWA) staff is requesting authorization to solicitproposals for real estate, environmental and engineering consulting services toprovide a gravity water storage reservoir system to serve the IWA jurisdictionalboundary. The proposed system would replace the current hydropneumatic watersystem operational mode. The scope of services included in the solicitationprocess is summarized as follows:

Phase 1 Site Evaluation: the objective of Phase 1 work is todetermine the most feasible sites for a reservoir. Ultimately, it isplanned that two sites will be selected.

ITEM NO. 4

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Agenda Report, City of IndioAuthorization to Solicit Engineering Proposalsfor Gravity Water Reservoir SystemPage 2

Phase 2 Environmental: This phase of the project will involvepreparation of appropriate environmental assessments and reports forthe two sites selected.

Phase 3 Engineering Design Services: This phase of the workinvolves design and preparation of plans, specifications and costestimates for the two sites. The analysis will include considerationof three potential reservoir design approaches, namely 1) aboveground steel reservoir; 2) partially buried concrete reservoir; and3) full buried concrete reservoir.

Phase 4 Bidding and Construction: This phase involves providingsupport services during the bidding and construction phase of theproject.

Based on the current schedule, proposals will be due by April 7, 2004. Staff willsubsequently review the proposals and make a recommendation to award anengineering contract for the work at the next available IWA meeting in April.Financial ImplicationsFunding for the water quality testing yiibe derived from the IWA Water CapitalImprovement FundReviewed and concurred:

JerryCar er Finance DirectorIRecommendationThe IWA staff is recommending that the IWA Board authorize staff to solicitproposals for engineering services for real estate, environmental and engineeringconsulting services to provide a gravity water storage reservoir system to servethe City of Indio service boundary.