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ENVIRONMENTAL FINANCE

DEPARTMENT OF NATURAL RESOURCES AND ENVIRONMENTAL CONTROL

OFFICE OF THE SECRETARY ENTERPRISE BUSINESS PARK

97 COMMERCE WAY, SUITE 106 DOVER, DELAWARE 19904

PHONE: (302) 739-9941

FAX: (302) 739-2137

Minutes of the Public Hearing

October 21, 2020 The Water Infrastructure Advisory Council held a public hearing on Wednesday, October 21, 2020 (9:00 a.m.) via WEBEX. MEMBERS PRESENT: Jeffrey Bross, Chairman Hans Medlarz, Vice-Chair Desmond Baker Jeffrey Flynn Richard Duncan Charles Anderson Jen Adkins Victoria K. Petrone J. Michael Riemann Robert Stickels MEMBERS ABSENT: Eugene Dvornick J. Michael Riemann Dave Baker Carolann Wicks OTHERS PRESENT WERE: Greg Pope, Environmental Finance Laura Robbins, Environmental Finance Robert Burns, Environmental Finance Laura Rafferty, Environmental Finance Davison Mwale, Environmental Finance Reza Moqtaderi, Environmental Finance Keith Kooker, Environmental Finance Jim Sullivan, DNREC Ben Coverdale, DNREC Gordon Woodrow, DNREC Jennifer Walls, DNREC Bryan Townsend, DNREC

Public Hearing Minutes – October 21, 2020 Page 2 of 10 Sandi Spiegel, DPH Diana Golt, Kent County Jason Lyon, City of Dover Kristy Rogers, Town of Milton David Del Grande, City of Newark Timothy Filasky, City of Newark David Athey, AECOM Brian Miller, Pennoni Patrick Morrison, AECOM Judy Schwarz, GMB Jessica Miller Jeff Lord CALL TO ORDER-PUBLIC HEARING Public Hearing came to order at 9:03 am. Greg Pope presented the following: SRF Public Workshop and Solicitation for Clean Water and Drinking Water Projects

o August 3, 2020 - Solicitation Opened o September 2, 2020 - Project Notices-of-Intent (NOIs) Due o October 21, 2020 - Public Notice/Public Comment Opens o October 21, 2020 - PPL/IUP Public Hearing o November 20, 2020 - Public Comment Period Closes o November 25, 2020 - Final 2020 PPL/IUP to be sent to EPA

Greg Pope presented the following: 2020 Clean Water State Revolving Fund (SRF) Revised Project Priority List (PPL) and Revised Intended Use Plan (IUP)

PPL Process and Ranking: Clean Water State Revolving Fund (CWSRF) NOIs - $29,541,330 from 1st solicitation and $5,085,000 from 2nd solicitation.

• $34,626,330 in total NOIs for 2020 • $78,897,407 in total 2020 IUP project requests for CWSRF funding

CWSRF Expanded-Use Programs: • $1.5 million – Non-Point Source Projects (Septic Systems, Poultry & Dairy Best

Management Practices) • $5.0 million – Land Conservation Loan Program • Based on Available Funds – Water Quality Improvement Loan Program

Greg Pope presented the 2020 CWSRF Revised Project Priority List (PPL)

Public Hearing Minutes – October 21, 2020 Page 3 of 10

2020 CWSRF Revised Intended Use Plan

Table 1 - Fund Sources, Uses, and Program Requirements Sources: Federal Capitalization Grant

FFY 2020 $ 7,780,000

FFY 2012 $27,050,176

State Match – 20% $ 1,556,000 $ 5,410,035 Total Sources $ 9,336,000 $32,460,211

Uses: WPCRF Administration (4%)

$ 1,082,007

WPCRF Administration (1/5 of 1%) $ 620,661 Program Loans $ 9,336,000 $31,378,204

Requirement: 10% Principal Loan Forgiveness (min.)

$ 778,000

10% Green Project Reserve $ 778,000

Optional: 30% Additional Subsidization (max.)

$ 2,334,000

Public Hearing Minutes – October 21, 2020 Page 4 of 10 2020 CWSRF Revised Intended Use Plan

Table 2 – Wastewater, Stormwater, and Green Project Reserve (GPR) Projects Selected for CWSRF Funding

Applicant / Project Name Total Cost CWSRF Funds Sussex County Council

• Land Conservation and Water Quality $ 9,500,000 $ 5,745,000 • Oak Acres $ 2,410,862 $ 2,410,862 • Branch, Autumn, and Tucks Road $ 7,788,761 $ 7,788,761 • Tanglewood $ 880,662 $ 880,662

Kent County Levy Court • Plant Wide Power Backup $ 4,452,200 $ 1,640,000 • Biosolid Capacity Expansion Project $24,668,300 $13,000,000 • Paris Villa and London Village SE Project $ 4,853,330 $ 4,853,330

City of Wilmington • Prices Run Sewer Interceptor Rehab $ 7,000,000 $ 7,000,000

Town of Smyrna • East Commerce Street Utility Replacement $ 1,940,881 $ 1,940,881

Public Hearing Minutes – October 21, 2020 Page 5 of 10 Applicant / Project Name Total Cost CWSRF Funds Lewes Board of Public Works

• Donovan Smith MHP $ 2,283,063 $ 2,283,063 • The Orchard Sewer Extension $ 1,357,000 $ 1,336,000 • Savannah Road Sewer Extension $ 2,025,000 $ 2,025,000 • Donovans Road Sewer Extension $ 925,000 $ 912,500

City of Seaford • Route 13 North Sewer Extension $ 1,019,911 $ 972,700

Tidewater Environmental Services, Inc. • Milton WWTP Replacement $ 12,777,802 $ 12,466,148

City of Newark • Sanitary Sewer System Study and Rehab $ 2,600,000 $ 2,600,000 Diamond State Sustainability Corp. • Grant’s Way Septic Elimination $ 2,088,000 $ 2,088,000 Artesian Wastewater Management, Inc • Rt 30, Huff Rd to SRRF Force Main $ 1,700,000 $ 1,000,000 Shady Oak DE, LLC • Shady Oak Mobile Home Park $ 600,000 $ 585,000

Total Cost CWSRF Funds Sub-Total Wastewater and Stormwater Projects $90,870,772 $ 71,527,907

Public Hearing Minutes – October 21, 2020 Page 6 of 10 Loans for five (5) GPR projects are anticipated to close during the year: City of Wilmington

• 15th and Walnut CSO Separation, $ 1,469,500 $ 1,369,500 Green Infrastructure & Bicycle Track

DNREC, Watershed Stewardship

• Watershed Improvement Projects $ 1,503,000 $ 1,503,000

DelDOT • Robscott Manor Watershed Project $ 2,046,480 $ 997,000

Lewes Board of Public Works • Jones Farm Land Purchase $ 2,000,000 $ 2,000,000 City of Lewes • Jones Farm Land Purchase $ 1,500,000 $ 1,500,000

Total Municipal Wastewater & GPR Funding $101,389,752 $78,897,407 Note: These IUP Project Estimates are based on original Notices of Intent (NOIs) or Applications Received and are subject to change with final applications, binding commitments, and amendments. Non-Federal Administrative Account (NFAA)

NFAA Required to be included in IUP Administrative Fee collected from ½ of the Interest on Municipal Loans Current Uses:

CWSRF Program Administrative Expenses Contractual Support in the Water Holding Tank Enforcement Program Contractual Support in the Watershed Non-Point Source Program Six (6) Water Quality Related Positions within DNREC Septic Extended Funding Option Loan Program (SEFO) Community Water Quality Improvement Grants Wastewater Matching Planning Grants Surface Water Matching Planning Grants Wastewater Asset Management Planning Grants Wastewater Project Planning Advances Additional Subsidization Program for Qualified Low-Income Rate Payers

Public Hearing Minutes – October 21, 2020 Page 7 of 10

Wastewater Needs Assessment/Stormwater Needs Assessment *WIAC will review the NFAA Semi-Annually to Ensure Sustainability CWSRF Non Federal Administrative Account (NFAA), Current and Planned Uses Updated 8-31-20

FY19 FY20 FY21 FY21 FY22 FY23 FY24Actual Actual Projected Actual to Date Projected Projected Projected

1. Source of Funds (includes Fed and Non-Fed Admin)

Total Annual Revenues $3,383,323 $3,535,500 $3,453,473 $1,185,397 $3,522,543 $3,592,994 $3,664,854

2. Administrative Expenses and Uses (includes Fed and Non-Fed Admin)

Total Administrative Expenses and Uses $1,227,646 $1,071,021 $1,093,439 $163,890 $1,117,439 $1,141,439 $1,165,439Total Administrative Obligations $109,387 $197,903 $200,000 $374,601 $200,000 $200,000 $200,000

3. CWSRF State Match $0 $0 $0 $0 $0 $0 $0

4. Additional Program Expenses and Uses

Total Additional Program Expenses $1,465,397 $1,518,093 $2,107,000 $479,561 $2,141,000 $2,155,000 $2,130,000Total End of FY Program Obligations $1,151,090 $1,299,051 $1,061,767 $1,288,747 $1,483,000 $1,535,000 $1,534,000

Total Combined Annual Expenses and Uses $2,693,043 $2,589,114 $3,200,439 $643,451 $3,258,439 $3,296,439 $3,295,439

5. Total CWSRF NFAA Expenses $2,693,043 $2,589,114 $3,200,439 $643,451 $3,258,439 $3,296,439 $3,295,439Total CWSRF NFAA End of FY Obligations $1,260,477 $1,496,954 $1,261,767 $1,663,348 $1,683,000 $1,735,000 $1,734,000

6. Annual Fund Growth (Decrease) $690,280 $946,386 $253,034 $541,946 $264,104 $296,555 $369,415

7. Balances

End of FY Available Fund Balance $4,508,383 $5,218,292 $4,308,233 $5,593,844 $4,151,000 $4,396,000 $4,766,000End of FY Accounting Fund Balance $5,768,860 $6,715,246 $5,570,000 $7,257,192 $5,834,000 $6,131,000 $6,500,000

8. Grant Program Uses

Total Proposed Program Uses $1,735,000 $1,599,700 $1,500,000 $1,500,000 $1,500,000 $1,500,000 $1,400,000 Obligated/Encumbered $1,151,090 $1,299,051 $1,061,767 $1,288,747 $1,483,000 $1,535,000 $1,534,000

Sandi Spiegel presented the 2020 Drinking Water State Revolving Fund (DWSRF) Project Priority List (PPL) and Intended Use Plan (IUP) EPA Requirements per America’s Water Infrastructure Act of 2018: “Total amount of subsidies -- For each fiscal year, of the amount of the capitalization grant received by the State for the year, the total amount of loan subsidies made by a State pursuant to paragraph (1) -- (A) may not exceed 35 percent; and (B) to the extent that there are sufficient applications for loans to communities described in paragraph (1), may not be less than 6 percent.” 2020 DWSRF Intended Use Plan 2% Set-Aside:

$220K Delaware Rural Water Association -On-Site Technical Assistance Delaware Technical and Community College-Operator Education

Public Hearing Minutes – October 21, 2020 Page 8 of 10 2020 DWSRF Intended Use Plan 4% Set-Aside:

$440,440 DHSS DWSRF Program $349,194 3.4 FTEs DNREC EF Program $91,246 0.8 FTEs 2020 DWSRF Intended Use Plan 10% Set-Aside:

$1,101,100 DHSS Public Water Supply Supervision Program $592,174 5.2 FTEs DNREC Underground Injection Control Program $508,926

3.35 FTEs 2020 DWSRF Intended Use Plan 15% Set-Aside:

$1,651,650 DHSS Capacity Development Program $1,058,286 5.4 FTEs DRWA/DTCC Contracts Sustainability Contracts DNREC Source Water Program $593,364 4.0 FTEs 2020 DWSRF Intended Use Plan Non-Fed Admin Cap Grant State Match: $2,202,200 DHSS DPH Laboratory Expenses: $400,000 DNREC EF Administration: $75,000 Asset Management Grants: $500,000 allotted - No new grants awarded.

Public Hearing Minutes – October 21, 2020 Page 9 of 10 Matching Planning Grants: $300,000 allotted – Grants were awarded to: Town of Smyrna ($25,050) City of Rehoboth ($40,000) City of Newark ($40,750) (Pending) City of Dover ($100,000). ~$205,800 Awarded Additional Subsidization Program for Qualified Rate Payers – Under Construction Laura Robbins presented the financial information:

Revised: 10-31-19

FY18 FY19 FY20 FY20 FY21 FY22 FY23Actual Actual Projected Actual to Date Projected Projected Projected

1. Revenue Sources

1. Investment Interest $48,266 $109,438 $111,627 $73,660 $113,859 $116,136 $118,459

2. Administrative Fee $1,313,478 $1,262,047 $1,287,288 $303,779 $1,313,034 $1,339,294 $1,366,080

Total Annual Revenues $1,361,744 $1,371,485 $1,398,915 $377,439 $1,426,893 $1,455,431 $1,484,539

2. Administrative Expenses and Uses

Environmental Finance DWSRF Program Support $315,718 $200,827 $204,844 $24,872 $208,940 $213,119 $217,382

PH - DW Contractual $12,354 $177,873 $181,430 $131,316 $185,059 $188,760 $192,535

PH - Laboratory Operations & Special Equipment $196,946 $172,462 $175,911 $27,673 $179,429 $183,018 $186,678

Total DWSRF Administrative Expenses $525,018 $551,162 $562,185 $183,861 $573,429 $584,898 $596,595Total End of FY Administrative Obligations $139,271 $168,113 $171,475 $473,822 $174,905 $178,403 $181,971

3. DWSRF State Match $1,648,200 $1,770,000 $0 $0 $1,500,000 $1,500,000 $1,500,000

4. Additional Program ExpensesTotal Additional Program Expenses $593,310 $301,720 $900,000 $29,895 $900,000 $900,000 $900,000

Total End of FY Program Obligations $997,797 $708,253 $1,134,690 $1,054,377 $1,459,953 $1,756,900 $2,022,110

5. Total DWSRF NFAA Expenses $2,766,528 $2,622,882 $1,462,185 $213,756 $2,973,429 $2,984,898 $2,996,595Total DWSRF NFAA End of FY Obligations $1,137,068 $876,366 $1,306,165 $1,528,199 $1,634,857 $1,935,303 $2,204,081

6. Annual Fund Growth / (Decrease) ($1,404,784) ($1,251,397) ($63,271) $163,683 ($1,546,536) ($1,529,467) ($1,512,056)

7. BalancesEnd of FY Available Fund Balance $7,282,663 $6,291,968 $5,798,898 $5,803,817 $3,923,670 $2,093,758 $312,923

End of FY Accounting Fund Balance $8,419,731 $7,168,334 $7,105,063 $7,332,017 $5,558,527 $4,029,060 $2,517,004

8. Grant Program UsesTotal Proposed Program Uses $2,129,200 $914,000 $1,214,000 $1,214,000 $900,000 $900,000 $900,000 Obligated $997,797 $708,253 $1,134,690 $1,054,377 $1,459,953 $1,756,900 $2,022,110

DWSRF Non Federal Administrative Account (NFAA) -- Current and Proposed Program Uses

The Non Federal Administrative account could be seriously depleted in the future if it is continually used for the State Match.

Public Hearing Minutes – October 21, 2020 Page 10 of 10 CWSRF Revised PPL/IUP & DWSRF PPL/IUP WIAC Member Comments: NONE Individuals requesting to speak were required to register prior to 9:00 a.m. of the day of

the hearing by calling 302-739-9941or emailing Laura Rafferty laura.rafferty@delaware.gov. Please make a statement for the public record. Not a question and answer session. NONE

Public Record will remain open until Wednesday, November 20, 2020 CWSRF Written Public Comments should be directed to: Greg Pope, P.E. DNREC Environmental Finance 97 Commerce Way, Suite 106 Dover, Delaware 19904 greg.pope@delaware.gov DWSRF Written Public Comments should be directed to:

Sandi Spiegel DHSS Division of Public Health 417 Federal Street Dover, DE 19901 sandi.spiegel@delaware.gov

Motion made by Mr. Duncan, seconded by Desmond Baker to adjourn the Public Hearing. Motion passed unanimously. The Public Hearing adjourned at 9:15 a.m.

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WATER INFRASTRUCTURE ADVISORY COUNCIL 97 COMMERCE WAY, SUITE 106

DOVER, DELAWARE 19904

PHONE: (302) 739-9941

FAX: (302) 739-2137

Minutes of the 156th Meeting

October 21, 2020 The Water Infrastructure Advisory Council held a public meeting on Wednesday, October 21, 2020 (9:00 a.m.) via WEBEX. MEMBERS PRESENT: Jeffrey Bross, Chairman Hans Medlarz, Vice-Chair Desmond Baker Jeffrey Flynn Richard Duncan Charles Anderson David Baker arrived at 9:25 a.m. Jen Adkins Victoria K. Petrone Carolann Wicks arrived at 9:24 a.m. J. Michael Riemann Robert Stickels MEMBERS ABSENT: Eugene Dvornick J. Michael Riemann OTHERS PRESENT WERE: Greg Pope, Environmental Finance Laura Robbins, Environmental Finance Robert Burns, Environmental Finance Laura Rafferty, Environmental Finance Davison Mwale, Environmental Finance Reza Moqtaderi, Environmental Finance Keith Kooker, Environmental Finance Jim Sullivan, DNREC Ben Coverdale, DNREC Gordon Woodrow, DNREC Jennifer Walls, DNREC

Public Meeting Minutes – October 21, 2020 Page 2 of 13 Bryan Townsend, DNREC Sandi Spiegel, DPH Diana Golt, Kent County Jason Lyon, City of Dover Kristy Rogers, Town of Milton David Del Grande, City of Newark Timothy Filasky, City of Newark David Athey, AECOM Brian Miller, Pennoni Patrick Morrison, AECOM Judy Schwarz, GMB Jessica Miller Jeff Lord CALL TO ORDER PUBLIC MEETING: Meeting came to order at 9:16 a.m. APPROVAL OF THE AGENDA: Motion made by Mr. Duncan, seconded by Desmond Baker to approve the agenda. Motion passed unanimously. APPROVAL OF PUBLIC MEETING MINUTES – August 19, 2020: Motion made by Mr. Duncan, seconded by Ms. Adkins to approve the August 19, 2020 public meeting minutes. Motion passed unanimously. WIAC INFORMATIONAL: Register for DNREC-WIAC public notices Greg Pope mentioned that solicitations are advertised in the newspapers and put on DNREC’s website and issued in DNREC press releases. The press releases relate to WIAC, CWSRF, DWSRF, and NFAA grant programs such as: NOI Solicitations, Planning Grant Solicitations, and Workshops. Subscribe by email: join-dnrec_press_releases@lists.state.de.us NEW BUSINESS: WIAC Vote to Approve FFY 2020 CWSRF and DWSRF Revised PPLs and IUPs Motion made by Desmond Baker, seconded by Vice-Chair Medlarz to approve the FFY 2020 CWSRF and DWSRF Revised PPLs and IUPs. Motion passed unanimously. DWSRF LOAN REQUESTS: Sandi Spiegel presented the Town of Milton-DWSRF Loan Request- Water Main Replacement Project: Project Description: The project will install approximately 6,800 feet of 6-inch main under Atlantic Avenue, Chestnut Street and Atlantic Street. This project will improve: reliability, water pressure, and fire protection flow. There will also be a reduced potential for water contamination.

Public Meeting Minutes – October 21, 2020 Page 3 of 13 Environmental Review: No adverse impacts. Categorical Exclusion issued. Capacity Development Review: Approval recommended. Construction Dates: Start Date: May 2021 End Date: October 2021 Project Budget a. Administrative $15,000 i. Land, Right of Way $0 ii. Legal $15,000 b. Engineering $80,000 c. Construction $1,181,000 i. Construction d. Other $177,200 i. Bonding and Insurance $59,000 ii. Mobilization/Demobilization $118,200 e. Contingencies $216,800 Total $1,670,000 Project Funding DWSRF Loan $1,670,000 Principal Forgiveness $1,670,000 Affordability Summary: The annual cost for drinking water service is estimated at $453 per Equivalent Dwelling Unit (EDU). This represents 0.82% of Median Household Income (MHI). The combined user rate including sewer services provided by Tidewater is estimated at 2.13% of MHI. Affordability Analysis - Drinking Water Loan Amount $1,670,000

Principal Forgiveness @ Completion $1,670,000 Interest Rate 2.00% Loan Terms Years 20 Annual Debt Service, New Facility $0 Existing Debt Service $105,000 Existing O,M & R $650,000 O,M & R Cost, New $3,000 Total Cost New Facility $758,000

Residential Share at 95% $720,100

Public Meeting Minutes – October 21, 2020 Page 4 of 13

EDU's 1588 Total Estimated Annual Charge Per EDU Water $453 Median Household Income $55,000 % of MHI for Drinking Water 0.82% Total Estimated Annual Charge Per EDU Wastewater Tidewater $720 % of MHI for Wastewater 1.31% Total Combined Drinking Water and Wastewater % of MHI 2.13% Loan Terms:

• Secured by a General Obligation Bond • The Interest Rate is 2.0% for a term of 20 years. • Interest only will be payable during construction in semi-annual installments. • Upon successful project completion, the principal balance up to $1,670,000 will be

forgiven. Recommendation: Based on information presented by the Town of Milton’s DWSRF application and the financial review conducted by DNREC, Environmental Finance; the Department of Health and Social Services, Division of Public Health recommends Council’s approval of the DWSRF Binding Loan Commitment in the amount of $1,670,000 to the Town of Milton for the Water Main Replacement Project with the aforementioned loan terms. Motion made by Mr. Duncan, seconded by Mr. Stickels to approve the DWSRF Binding Loan Commitment ($1,670,000) to the Town of Milton for the Water Main Replacement Project. Motion passed unanimously. Mr. Duncan stated that this project will be an asset to the Town of Milton; Last year it was discovered during hydrant flow testing that the flow was very low. Sandi Spiegel presented the City of Newark -DWSRF Loan Request- Laird Tract Well Field Restoration Project Project Description: This project involves making the necessary upgrades to the existing wells and providing a treatment facility to allow the utilization of the wells with added treatment and improved well head protection. The benefits are improved water quality, provide redundancy, and drought protection. Environmental Review: No adverse impacts. Categorical Exclusion issued. Capacity Development Review: Approval recommended.

Public Meeting Minutes – October 21, 2020 Page 5 of 13 Construction Dates: Start Date: June 2021 End Date: November 2022 Project Budget a. Administration $0 i. Land, Right of Way $0 ii. Legal $0 b. Engineering $380,000 c. Construction $1,770,000 i. Construction $1,770,000 d. Other $0 e. Contingencies $0

Total $2,150,000 Project Funding Newark's Capital Funds $225,000 DWSRF Loan $1,925,000

DWSRF Loan $1,925,000 Affordability Summary – User Rates The annual cost for drinking water service is estimated at $176 per Equivalent Dwelling Unit (EDU). This represents 0.31% of Median Household Income (MHI). When the utility provides both drinking water and wastewater service the affordability standard is 2.0% of MHI. The combined user rate including storm water is estimated at 0.67% of MHI.

Public Meeting Minutes – October 21, 2020 Page 6 of 13

Drinking Water Wastewater Storm Water

Affordability Analysis Laird Tract Well Field Restoration

Estimated Project Cost $1,925,000 Loan Amount $1,925,000 Interest Rate 2.000% Loan Terms Years 20 Annual Debt Service, New Facility $117,254 Existing Debt Service $1,873,882 $35,000 $120,000

Debt Service South Well Field $255,000 Increase in O,M & R $30,000 O,M & R Cost, Existing Facility $4,773,248 $6,693,212 $1,455,790 Total Cost New Facility $7,049,384 $6,728,212 $1,575,790 Residential Share at 20% $1,409,877 $1,345,642 $315,158 EDU's 8000 8000 8000 Project Cost per EDU $3.68 Drinking Water Total Estimated Annual Charge Per EDU $176 $168 $39 Median Household Income $57,391 $57,391 $57,931 % of MHI 0.31% 0.29% 0.07% Combined MHI 0.67% Loan Terms:

• Secured by a General Obligation Bond • The Interest Rate is 2.0% for a term of 20 years. • Interest only will be payable during construction in semi-annual installments. • Upon project completion, principal and interest payments shall be paid semi-annually in

an amount sufficient to amortize the outstanding principal balance over the 20-year term.

Public Meeting Minutes – October 21, 2020 Page 7 of 13 Recommendation: Based on information presented by the City of Newark’s DWSRF application and the financial review conducted by DNREC, Environmental Finance; the Department of Health and Social Services, Division of Public Health recommends Council’s approval of the DWSRF Binding Loan Commitment in the amount of $1,925,000 to the City for the Laird Tract Well Field Restoration Project with the aforementioned terms. Motion made by Mr. Duncan, seconded by Ms. Adkins to approve the DWSRF Binding Loan Commitment ($1,925,000) to the City of Newark for the Laird Tract Well Restoration Project. Motion passed unanimously. Contingencies on the project budget is $0. Tim Filasky explained that any contingencies would be self-funded. Chairman Bross suggested adopting a 2% MHI policy cap to include stormwater utilities fees for municipalities that have a stormwater assessment. He would like this action brought before the Council. NON-FEDERAL ADMINISTRATIVE ACCCOUNT (NFAA) GRANT APPLICATIONS: DRINKING WATER MATCHING PLANNING GRANTS Presented by Sandi Spiegel:

Applicant: City of Dover Project Name: Update to the City of Dover Master Plan Total Project Cost: $200,000 Assistance Requested: $100,000 Start Date: December 1, 2020 Completion Date: April 30, 2021 Project Description: This update will provide a complete re-evaluation of the City water

system, including the water supply, water storage and water distribution system. The plan will update the projected long term demands of the City, the water supply and new technology research for aquifer recharge, water storage and water distribution system.

Motion made by Mr. Duncan, seconded by Vice-Chair Medlarz to approve the Drinking Water Matching Planning Grant for the City of Dover ($100,000). Motion passed unanimously. FY2021 DRINKING WATER NFAA GRANT STATUS Drinking Water Matching Planning Grants: Budgeted: $300,000 Requested to Date: $205,800 Remaining: $94,200 Drinking Water Asset Management Grants: Budgeted: $500,000

Public Meeting Minutes – October 21, 2020 Page 8 of 13 Requested to Date: $0 Remaining: $500,000 Drinking Water Additional Subsidization Grants Budgeted: $100,000 Requested to Date: $0 Remaining: $100,000 ADMINISTRATORS’ REPORTS: Presented by Laura Robbins: No changes have been made to the CWSRF and DWSRF assumptions in the demand. If there should be a decrease in the demand due to a decrease in construction, or municipalities not having the ability to borrow; there would be an increase in the balances. CWSRF CASH FLOW ASSUMPTIONS Loan Terms for Future Commitments

• New Commitments & Loans in Construction for 2021 consist of $80,397,407 in new loan commitments, of which $1,500,000 is allocated for Septic Rehabilitation loans, Agricultural Non-Point Source loans, and Expanded Uses Non-Point Source loans

• 80% of portfolio is traditional with a 20-year term at 2% • 15% of portfolio is small community with a 30-year term at 1% • 5% of portfolio is sponsorship with a 20-year term at 2% • Principal forgiveness of $16 Million has been committed and is assumed at 20% of

the Cap Grant in future years Loan Probability Factors includes PPL Loans & Loans in Construction

• 3 = Only High Probability Projects Considered ($80,397,407) • 2 = High and Medium Probability Projects Considered ($0) • 1 = High, Medium and Low Probability Projects Considered ($0) • Model is set to include projects in 3 • New Commitments represent 100% of the Revised Federal FY2020 PPL (State

FY2021) which provides disbursement projections through 2022. Minimum Cash Balance

• Assumes a $5 Million minimum cash balance • Future Cap Grant assumes 85% of Federal payment from the previous year, and a

conservative $3.5 Million Cap Grant in the years 2024 and 2025

Public Meeting Minutes – October 21, 2020 Page 9 of 13

Delaware CWSRF FOCUS ModelFinancing and Cash Flow Utilization in the SRFVersion: August 2020

Summary State Fiscal Year 2021 2022 2023 2024 2025New Commitments $80,397,407 $10,750,000 $20,750,000 $27,750,000 $30,750,000Disbursements including Loans in Constructio $101,800,077 $47,567,809 $21,287,880 $20,810,000 $27,937,500Loan Repayments $20,719,067 $23,936,145 $25,473,912 $26,036,017 $26,648,993Capitalization Grant Payments $7,780,000 $7,780,000 $6,613,000 $3,500,000 $3,500,000State Match $1,556,000 $1,556,000 $1,322,600 $700,000 $700,000Fee Income $2,919,327 $3,387,533 $3,390,565 $3,347,780 $3,318,413End of Year Cash Balance $19,427,001 $5,510,676 $17,993,027 $27,760,585 $30,993,865

If the balance for CWSRF become low, the PPL would be funded by ranking. Leveraging the fund would also be another option. CWSRF could borrow money from DWSRF: The funds would be transferred back to DWSRF on a pro rata basis.

Public Meeting Minutes – October 21, 2020 Page 10 of 13 DWSRF CASH FLOW ASSUMPTIONS Loan Terms for Future Commitments

• New Commitments $36,587,802 • 85% of portfolio is traditional with a 20-year term at 2% • 15% of portfolio is small community with a 30-year term at 1% • Principal forgiveness of $19.4 Million has been committed and is assumed at 20% of

the Cap Grant in future years Loan Probability Factors includes PPL Loans & Loans in Construction

• 3 = Only High Probability Projects Considered ($36,587,802) • 2 = High and Medium Probability Projects Considered ($0) • 1 = High, Medium and Low Probability Projects Considered ($0) • Model is set to include projects in 3 • New Commitments represents 100% of Federal FY2020 PPL (State FY2021) which

includes disbursement projections through 2022 Minimum Cash Balance

• Assumes a $5 Million minimum cash balance • Future Cap Grant assumes 85% Federal payment from the previous year, through

2025

Delaware DWSRF FOCUS ModelFinancing and Cash Flow Utilization in the SRFVersion: August 2020

Summary State Fiscal Year 2021 2022 2023 2024 2025New Commitments $36,587,802 $38,000,000 $40,000,000 $38,000,000 $25,000,000Disbursements including Loans in Constructio $52,574,899 $18,555,007 $32,645,000 $39,587,500 $35,000,000Loan Repayments $10,569,442 $11,832,628 $12,263,234 $13,328,348 $15,094,529Capitalization Grant Payments $11,011,000 $9,359,350 $9,359,350 $9,359,350 $9,359,350State Match $2,202,200 $1,871,870 $1,871,870 $1,871,870 $1,871,870Fee Income $1,443,507 $1,567,964 $1,613,221 $1,814,474 $2,009,606End of Year Cash Balance (Not Discounted) $46,030,824 $47,773,267 $35,856,322 $18,061,992 $6,621,342

Public Meeting Minutes – October 21, 2020 Page 11 of 13

DWSRF got its annual review from EPA. One of the action items is for DWSRF to pick up the pace to decrease the unobligated funds at the end of the year. In the annual report to the EPA, Sandi Spiegel requested that EPA lower the need for the increased amount of additional subsidies.

Public Meeting Minutes – October 21, 2020 Page 12 of 13 SUBCOMMITTEE REPORTS: Wastewater: Bob Stickels attended the meeting and had some issues about the PPL. He expressed concern about Shady Oak Mobile Home Park and the cost getting passed onto the tenants. Mr. Pope explained that the PPL list is for pre-applicants. The NOIs are ranked and no application has been submitted at this point. An analysis will be done to see what the most cost-effective route would be to go: central sewer, decentralized system, or replace in-kind the septic systems. Also, there would be a caveat that would protect the tenants from a rent increase. Mr. Stickles asked if Artesian’s Force Main Project would impact Sussex County’s expansion. He also had concerns about Artesian taking in only 5,000 EDUs in an unincorporated area for $1 million loan. Vice-Chair Medlarz explained that Sussex County uses a Tier system in the Comprehensive Plan: Tier 1 and Tier 2 are served exclusively by the County; Tier 3 the County has the right of first refusal; and Tier 4 and Tier 5 the County has no interest. Artesian’s project is mostly within the Tier 4 area and the County has no interest. Surface Water: Vice-Chair Medlarz reported that he is waiting on a trend analysis of Surface Water Matching Planning Grants and Community Water Quality Improvement Grants for the past five years from Jim Sullivan. The goal is to be able to make better projections to avoid unused allocations. Vice-Chair Medlarz reported that he did recuse himself from this recommendation: A time extension request by The City of Rehoboth for the Silver Lake /Lake Comegys Management Plan was recommended by the Subcommittee for the Secretary to be considered. Finance: Jen Adkins started a new position in late July 2020 as the Director of Clean Water Supply for American Rivers. American Rivers is a national organization that is focused on restoring and protecting rivers and making sure that everyone has access to the clean water in rivers. She is working in the Mid Atlantic: Delaware River Watershed and the Rivers of the Chesapeake. The focus is water infrastructure, financing, and green infrastructure. The Finance Subcommittee met on October 12, 2020. The projects and financial information presented at today’s meeting was reviewed. There are a number of topics on hold due to the understaffing at Environmental Finance; one of which is updating the affordability policy. The next Finance Subcommittee meeting is on December 7, 2020 at 2:00p.m. Drinking Water: Mr. Duncan reported that they reviewed today’s presented projects: The Town of Milton Water Main Replacement Project; The City of Newark Laird Tract Well Field Restoration Project; and the City of Dover Matching Planning Grant. The Drinking Water New Regulations are in the final stage and hope to be adopted in January 2021; some of the benefits to the SRF: fluoridation of drinking water systems, and water systems will have to have a cross connection control plan for backflow prevention. PUBLIC COMMENTS: NONE GOOD OF THE COUNCIL: Vice-Chair Medlarz would like the joint 2% MHI cap to apply to DWSRF and CWSRF equally even if the utilities are not owned by the same entity. Greg Pope and Sandi Spiegel are working on how the policy is applied to both DWSRF and CWSRF, and if it a part of the overall utility. It will be present to the Finance Committee and the WIAC.

Public Meeting Minutes – October 21, 2020 Page 13 of 13 MEETING ADJOURNMENT: Chairman Bross adjourned the meeting at 10:19 a.m. The next WIAC meeting is December 16, 2020, and held at Del Tech Terry Campus, 100 Campus Drive, Dover, DE at 9:00 a.m.; however, if there are still COVID-19 restrictions, the meeting will be via WEBEX.