HomeMy WebLinkAbout18 Power Point DWR SRF Loan Payoff Early on 7.01.2021
June 2, 2021 Lake water system acquisition and improvementsResources State Revolving Fund Loan Related to Donner Consideration of Early Payoff of California Department of # 18ACTION
ITEM
•BACKGROUND / HISTORYBACKGROUND / HISTORY SRF Loan Payoff 7/1/2021DWR -CASRF Loan Payoff 7/1/2021DWR -CA customersLake system private water system and system improvements specific to
Donner Donner Lake Assessment District (DLAD) to fund Donner Lake’s 2001, the District and community of Donner Lake formed the In
•BACKGROUND / HISTORYBACKGROUND / HISTORY SRF Loan Payoff 7/1/2021DWR -CASRF Loan Payoff 7/1/2021DWR -CA proceeds/assessment SRF loan incremental water system costs not included in
the DLAD month was established through 9/2036 (30 years) to cover the Accordingly, a Donner Lake Surcharge of $6.65 per customer per runs -overDistrict incurred bond debt to fund the
cost The •starting in 20062001/2002, and a DWR SRF 20 year loan was drawn with payments starting in amountDLAD was established for 20 years at a fixed The •forecasted , both at a cost
greater than 2001 through 2005Acquisition of the system and improvements to system occurred in
•NEW INFORMATIONNEW INFORMATION SRF Loan Payoff 7/1/2021DWR -CASRF Loan Payoff 7/1/2021DWR -CA%the loan is 2.34funds are currently earning less than 0.4% and the interest rate on Cash
•in March 2021, Now Restricted cash fundsterm (14 year) investment of $1.7 million yielding 5.25%, matured -A long•payments endpayments started, and ended (FY20/21) four years before
the loan The 20 years of assessments started four years before the loan •and save interest expense costshave cash on hand funds available in 2021 to pay off the loan early The Donner
Lake Assessment District related restricted accounts
Available DLAD Restricted cash fund components, estimated as of 6/30/2021:NEW INFORMATIONNEW INFORMATION SRF Loan Payoff 7/1/2021DWR -CASRF Loan Payoff 7/1/2021DWR -CA Funds$ 4,382,000
Total Cash 877,000 DLAD Improvement Fund283,000 DLAD funds received from NV County in May 2021 for 20/21 AssessmentUPTIF -Invested 667,000 DLAD Fund accountReserve 830,000 Farm
Investment (14 year investment, matured 3/2021)Fed $ 1,700,000
Loan balance components:income on Fed Farmint$198 capital expend contingency in ’06 / $180K Interest Income$202K Interest Savings NEW INFORMATIONNEW INFORMATION SRF Loan Payoff 7/1/2021DWR
-CASRF Loan Payoff 7/1/2021DWR -CA loan payoff-$ 580,000 cash funds available (Restricted), post$ 3,802,173.30 Amount due 7/1/2021 to payoff loan in fullInterest accrual 1/2/2021 to
7/1/202143,970.97$ 3,758,202.33 Principal balance after 1/1/2021 loan payment
•NEW INFORMATIONNEW INFORMATION SRF Loan Payoff 7/1/2021DWR CASRF Loan Payoff 7/1/2021DWR CA 2031approximately Q2 of surcharge earlier than planned, this would equate to 5.3 years earlier
or 7/1 early payoff cash funds ($580k) were applied to ending -all postIf •Bonds (a refunding of 2006 bondswhich is applied to corresponding Donner Lake portion of 2016 COP surcharge
currently generates approximately $110,000 annually, The •2036 scheduled end date of October potentially to end the Donner Lake Surcharge earlier than the , the funds could be used
additional projects are necessaryno If •DLADfunds available are restricted, specific to $580,000 cash The
•FISCAL IMPACTFISCAL IMPACT SRF Loan Payoff 7/1/2021DWR CASRF Loan Payoff 7/1/2021DWR CA$160,000 Net Present Value of savings= $162,000 net cash flow savings used on 7/1/2021funds
($40,000) Loss of interest income on cash •$202,000 Interest expense savings on loan •Paying off the loan early on 7/1/2021 instead of over time thru 1/1/2026:
•RECOMMENDATIONRECOMMENDATION SRF Loan Payoff 7/1/2021DWR -CASRF Loan Payoff 7/1/2021DWR -CA 1/1/2026loan scheduled ending of $3,802,173.30, saving $202,088 in interest expense through
Approve the payoff in full of SRF loan on 7/1/2021 in the amount