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THE CITY OF CITY COUNCIL PLEASANTON JOINT POWERS DI 1 CANTON. FINANCING AUTHORITY AGENDA REPORT February 7, 2017 Finance TITLE: ADOPT A RESOLUTION APPROVING AN INSTALLMENT SALE AGREEMENT AND ISSUANCE BY THE PLEASANTON JOINT POWERS FINANCING AUTHORITY OF AN AGGREGATE AMOUNT NOT TO EXCEED $7.4 MILLION OF WATER REVENUE BONDS SERIES 2017 TO FUND THE CITY'S PORTION OF THE DERWA PHASE 2 RECYCLED WATER TREATMENT PLAN EXPANSION PROJECT AND AUTHORIZING EXECUTION OF A TRUST AGREEMENT, A 2017 INSTALLMENT SALE AGREEMENT, A BOND PURCHASE CONTRACT AND OTHER NECESSARY DOCUMENTATION SUMMARY The City's primary source of recycled water(RW) being delivered to and through the new Pleasanton Purple Pipe Project is produced by DERWA (Dublin San Ramon Services District (DSRSD) — East Bay Municipal Utility District (EBMUD) - Recycled Water Agency) In order to meet all of our forecasted RW demands, the City entered into an agreement with DERWA to participate in the DERWA facilities expansion project that is estimated to cost $18 4 million The construction began in January 2017 Pleasanton's share of the project is estimated to be $7 1 million including construction, capacity buy-in costs, contingency and financing costs associated with the proposed Water Revenue Bonds (Bonds) to pay the obligation The proposed not to exceed $7 4 million in Bonds will fund the City's $7 1 million obligation The proposed Bonds to be issued by the Pleasanton Joint Powers Financing Authority (JPA Authority) for an amount not to exceed $7 4 million will (1) be a private placement with JP Morgan Chase, (2) mature in eight years, (3) have an interest rate not to exceed 2 20%, and (4) exclude a call provision RECOMMENDATION It is recommended that the City Council and JPA Authority adopt the attached resolutions approving an Installment Sale Agreement (Agreement) and issuance by the Pleasanton Joint Powers Financing Authority of an aggregate amount not to exceed $7 4 million Water Revenue Bonds Series 2017 and related documents