Indiana Finance Authority State Revolving Fund Loan Program

Indiana Finance Authority State Revolving Fund Loan Program ACEC August 26, 2019 State Revolving Fund 100 N. Senate Avenue, Room 1275 Indianapolis, Indiana 46204 cmeiners@ifa. in. gov 317 -234 -3661

Indiana Finance Authority State Revolving Fund Loan Program SRF Organizational Chart Jim Mc. Goff COO & Director of Environmental Programs State Revolving Fund Loan Programs Joanie Jones Administrative Assistant Matt Martin Bill Harkins Finance Manager SRF Program Director Emma Kottlowski Financial Analyst Kary Long Disbursement Coordinator Camille Meiners, PE Technical Review Coordinator Alison Martin Finance Manager Debbie Wright General Counsel Amy Henninger Compliance Officer Shelley Love WW Administrator Staci Orr - Gardner Amanda Rickard, PE Project Engineer Tracey Trimpe, PE Project Engineer Artemis Nikolaou Project Engineer DW Administrator Gayle Hicks Bid Coordinator April Douglas Environmental Reviewer 2

Indiana SRF Accomplishments As of June 30, 2019 § 559 loans closed in the Clean Water Program § 265 loans closed in the Drinking Water Program § Over 390 Communities Served § Over $5. 1 Billion in loan closings § Over $4. 6 Billion disbursed to communities § Estimated $332 million in savings to borrowers, over the last 5 years (compared to market) 3

Current Loan Demand Project Priority Lists (PPLs) document the funding need for infrastructure projects in Indiana surpasses our ability to fund through the traditional SRF program. TOTAL DW Q 1 PPL $387 M WW Q 1 Large System PPL $897 M WW Q 1 Small System PPL $195 M $1. 4 B + 4

SRF Interest Rates SRF Rates July 1, 2019 – September 30, 2019 Wastewater SRF Interest Rates User Rates (Over $50) Tier III (MHI: under $41, 746) 2. 00% Tier II (MHI: $40, 747 to $50, 181) 2. 00% Tier I (MHI over $50, 181) 2. 00% Drinking Water SRF Interest Rates Tier III (MHI: under $41, 746) User Rates (Over $45) User Rates ($30 to $50) 2. 00% User Rates ($25 to $45) User Rates (Under $30) 2. 00% User Rates (Under $25) 2. 00% Tier II (MHI: $40, 747 to $50, 181) 2. 00% Tier I (MHI over $50, 181) 2. 00% 5

What’s new? Quarter Calendar What are the SFY quarters? Q 1 Q 2 July 1 – September 30 October 1 – December 31 Q 3 Q 4 January 1 – March 31 April 1 – June 30 6

Funding Cycle 20 Closings Per Quarter Online Calendar 7

Funding Cycle Prior SFYs: • Fundable Range Established – Q 1, July • Earmarked Funds Until December • Permits • Land • Bids • Financial • By. Pass – January - June 8

Funding Cycle SFY 2020: • Fundable Range Established – Q 1, July • Earmarked Funds Until March • Permits • Land • Bids • Financial • By. Pass – April - June 9

Schedule How to get put on the calendar: 1. PER submitted, ranked and in fundable range 2. Municipal Advisor provides commitment letter to Bill Harkins • Bids Opened _______ • All Permits approved _____ • All Land Acquired ______ • Quarter requested 3. Prior to officially being placed on the calendar, above requirements must be met 10

Asset Management Indiana Code 5 -1. 2 -10 -16 WW and DW – entire system Start with the Certification • SRF wants one document – the Certification • When do you submit the certification? • How does this related to the Fiscal Sustainability Plan requirement? – Federal vs. State 11

SRF AMP Documents Available: • Asset Management Program Memorandum • Asset Management Program Guidelines • Asset Management Program Certification • Asset Management Program Checklist • Asset Management Program Guidance More information: https: //www. in. gov/ifa/srf/2376. htm 12

AMP Documents Guidelines vs. Guidance 13

AMP Documents Certification Checklist Guidance Certification 14

SRF AMP Certification Ask yourself… 15

SRF AMP Guidance Technical Managerial Financial 16

SRF AMP Guidance Cyber Security Framework https: //www. nist. gov/cyberframework/online -learning/five-functions 17

SRF AMP Guidance Cyber Security Checklist Identify Assets Protect Policies Detect Monitor Respond Response Plan Recover Update/Improve 18

SRF Incentives SRF Incentive Programs: • GPR • NPS • Brownfields • Lead Service Line Replacement • Extended Term Financing 19

SRF Incentives GPR • 0. 5% interest rate break • Categorical/Business Case • Submit documentation prior to close • Planning, design, construction Non-Point Source • 0. 5% interest rate break • Septic System Elimination, non-point source treatment • Submit documentation prior to close • Could include entire project cost 20

SRF Incentives Brownfields Project • 0. 5% interest rate break • Submit documentation prior to close • Timing 21

SRF Incentives Lead Service Line Replacement • Interest rate break to 0. 00% • Only complete lead service lines are eligible *Meter or shut off valve • Tracking 22

Illustration of SRF Cost Savings Lead Line Replacement Incentive Utility ABC’s Financing Cost Original Loan New SRF Loan Interest Rate Debt Service Amount available for lead line project $10, 000 2. 25% $12, 500, 000 Loan Structured with Lead Line Rate Reduction Debt Service $12, 500, 000 0. 00% $12, 500, 000 $ 2, 500, 000 • Interest rate savings will allow Utility to apply $2, 500, 000 towards costs associated with lead line replacement project at no additional costs to rate payers. • Similar methodology is applied to GPR projects. 23

SRF Incentives Extended Term Financing • Up to 35 years • Pipe only • Useful life – Entire project ≥ loan term • Slightly higher rate – 10 basis points per 5 years Loan Term 21 -25 26 -30 30 -35 Interest Rate Increase +0. 1% +0. 2% +0. 3% 24

SRF Incentives How to these work together? 1. Floor is 2. 00% for projects without lead service line replacement 2. Lead service line replacement projects can be as low as 0. 00% 3. GPR, NPS, BF all reduced prior to addition of extended term financing increase Examples: 1. Project with GPR: Rate = 2. 35%, GPR reduces rate to floor of 2. 00% 2. Project with GPR and Extended term of 35 years: Rate = 2. 35%, GPR reduces rate to 2. 00%, 35 year term increases rate to 2. 30% 3. Project with Lead Line Replacement and Extended Term of 35 years: Rate = 2. 35%, Lead line replacement reduces rate to 0. 00%, 35 year term 25 increases rate to 0. 30%

Flood Control Program Transferred to IFA in 2016 from DNR Applications may be submitted at any time Loan Terms Maximum borrowing amount is $250, 000 • 2. 0% for loan terms between 1 year and 5 years • 2. 5% for loan terms over 5 years to 10 years OCRA Match? 26

Flood Control Program Flood control projects must provide benefits to their communities and may include one or more of the following endeavors: • The removal of obstructions and accumulated debris from channels of streams • The clearing and straightening of channels of streams • The creating of new and enlarged channels of streams, wherever required • The building or repairing of dikes, levees, or other flood protective works • The construction of bank protection works for streams • The establishment of floodways • Conducting all other activities that are permitted by the federal Flood Control Act or federal Clean Water Act 27

Questions? 28

Camille Meiners, PE Technical Review Coordinator 317 -234 -3661 cmeiners@ifa. in. gov www. srf. in. gov 29