Discussion and possible action on any and all matters regarding Resolution No. 2284. A Resolution of the Mayor and City Council of the City of San Luis, Arizona, a Municipal Corporation of Arizona, to authorize the application for a Drinking Water State Revolving Fund Loan from the Water Infrastructure Finance Authority (WIFA). (Monica Castro, Director of Finance)

Resolution No. 2284 authorizes staff to apply for a loan from the Water Infrastructure Finance Authority of Arizona ("WIFA") through the Drinking Water State Revolving Fund program. 

The Drinking Water State Revolving Fund program helps public and private water systems across Arizona meet the objectives of the Federal Safe Drinking Water Act by providing a permanent, independent source of low-cost financing. Under the Drinking Water State Revolving Fund, WIFA provides various types of assistance, including loans, technical assistance, and forgivable principal. The loan terms vary and may include an interest rate discount and repayment periods of up to 30 years. However, the repayment period cannot exceed the useful life of the infrastructure financed. For example, if a project has a maximum useful life of 15 years, the loan term cannot exceed 15 years.  WIFA tailors all loan terms to the borrower's situation and needs.

An administrative resolution is required by WIFA that will authorize the City to apply for the Drinking Water State Revolving Fund financial assistance from WIFA for City water projects.  After the adoption of this resolution, the City will apply for financial assistance from WIFA and if matters proceed satisfactorily to the City and WIFA, WIFA will prepare a loan agreement to be entered into by and between the City and WIFA for such financial assistance.  The form of such a loan agreement would be approved at a subsequent City Council meeting.  The final terms of a loan agreement would be known later in the process but would include a federally subsidized interest rate that could result in lower interest costs to the City and could include what WIFA calls “forgivable principal”, which functions essentially like a grant.