Title
Amending Section 4.09 of the Restated General Water and Wastewater Revenue Bond Ordinance of 1989 to authorize the Director of Finance to use funds currently held in the Debt Reserve Account established and maintained under the said General Ordinance to purchase appropriate surety bonds or insurance policies for deposit in the said Debt Reserve Account in lieu of current deposits; further, directing the Director of Finance to transfer all excess funds remaining in the said Debt Reserve Account after purchase of the said surety bonds or insurance policies to the Water and Wastewater Revenue Fund; and further, amending Section 4.12 of the said Restated General Water and Wastewater Revenue Bond Ordinance of 1989, entitled Residual Fund, to establish a new sub-account into which shall be deposited all residual water and wastewater operating revenues resulting from the transfer of funds from the Debt Reserve Account to the Revenue Fund and thereafter to the Residual Fund, the entire balance of the said new Residual Fund sub-account to be used to finance water related infrastructure projects.
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WHEREAS, the First Class City Revenue Bond Act of 1972, 53P.S.Section 15901 et seq. (the Revenue Bond Act) authorizes the issuance of revenue bonds by the City of Philadelphia; and
WHEREAS, by Ordinance approved by the Mayor on June 24, 1993, the City adopted the Restated General Water and Wastewater Revenue Bond Ordinance of 1989 (the General Ordinance) authorizing the issuance of water and wastewater revenue bonds of the City of Philadelphia under certain term and conditions, including the establishment and maintenance of a Debt Reserve Account; and
WHEREAS, funds are currently on deposit in the Debt Reserve Account and are being held therein, pursuant to the General Ordinance, as a reserve for payment of certain obligations in the event of an insufficiency of funds available for that purpose in the Debt Service Account; and
WHEREAS, the General Ordinance, in Section 4.09, entitled Debt Reserve Account, states in relevant part that in lieu of required deposits into the Debt Reserve Account, the City may cause to be deposited into the Debt Reserve Account a surety bond or an insurance policy payable to the Fiscal Agent for the account of the Bondholders and any Qualified Swap, but does not explicitly address a substitution of surety bonds or insurance policies for existing deposits; and
WHEREAS the General Ordinance, in Section 4.09, states in relevant part that, Any money in the Debt Reserve Account in excess of the Debt Reserve Requirement shall be transferred to the Revenue Fund at the written direction of the City; and
WHEREAS, the General Ordinance, in Section 4.06, entitled Transfer from Revenue Fund to Other Funds and Accounts provides that water and wastewater revenues are to be applied to various purposes, funds and accounts in an established order of priority ending with a certain Residual Fund created by Sections 4.04(e) and 4.12 of the General Ordinance; and
WHEREAS, the General Ordinance, in Section 4.12, states the purposes for which funds in the Residual Fund may be used, including, (ii) to fund transfers to any fund or account established hereunder or under a Supplemental Ordinance (other than the Revenue Fund and the Rate Stabilization Fund); and
WHEREAS, the General Ordinance in Section 4.12(ii) does not in any way identify fund or account established hereunder as only those specific funds and accounts established by the originally enacted form of the General Ordinance, or in any other way expressly limit transfers from the Residual Fund to only funds and accounts established hereunder at the time of original enactment of the General Ordinance,; and
WHEREAS, the General Ordinance in Section 10.01, entitled Amendments and Modifications, authorizes the General Ordinance to be supplemented, modified or amended to cure ambiguities or omissions in the General Ordinance by amendments which are not inconsistent with the provisions of the General Ordinance and which do not adversely affect the interests of bondholders; and
WHEREAS, the lack of explicit language to address a substitution of surety bonds or insurance policies for deposits currently held in the Debt Reserve Account, and the lack of explicit language to authorize an appropriate transfer of resulting excess funds in the Residual Fund under circumstances arising from a partial or complete substitution of surety bonds or insurance policies for moneys held in the Debt Reserve Account, constitute ambiguities or omissions in the General Ordinance; and
WHEREAS, the substitution of appropriate surety bonds or insurance policies for cash and other deposits now held in the Debt Reserve Account, and the transfer of resulting excess moneys to the Revenue Fund and then to the Residual Fund to finance water related infrastructure projects will not adversely affect the interests of bondholders; and
WHEREAS, the Council desires to explicitly address and authorize substitutions of surety bonds or insurance policies for cash and other deposits already held in the Debt Reserve Account; and
WHEREAS, the Council desires to create and establish a new fund or account pursuant to Sections 4.12 (ii) and Section 10.01 of the General Ordinance and further implement the authorization contained in the Revenue Bond Act, at 53P.S. Section 15909, providing in relevant part that, Excess moneys in the sinking fund, including moneys for the payment of the interest, principal or premium of bonds unclaimed after the due date for two years, and excess moneys in other funds shall be repaid to the city for its general purposes or applied as may be provided in the bond ordinance; and
WHEREAS, the Council desires to hereby authorize use of funds in the Residual Fund to finance water related infrastructure projects by the establishment of a new Residual Fund sub-account under Section 4.12 (ii), but to limit the said new additional use of funds to only that amount of residual water and wastewater revenues attributable to transfer of funds from the Debt Reserve Account to the Revenue Fund as a result of purchase of appropriate surety bonds or insurance policies; now therefore,
THE COUNCIL OF THE CITY OF PHILADELPHIA HEREBY ORDAINS:
SECTION 1. Section 4.09 of the Restated General Water and Wastewater Revenue Bond Ordinance of 1989, as amended, (hereinafter the General Ordinance), entitled Debt Reserve Account is hereby amended to add the following paragraph:
The Director of Finance is hereby authorized to use funds already held in the Debt Reserve Account to purchase appropriate surety bonds or insurance policies for deposit in the Debt Reserve Account in lieu of some or all of the current cash or other deposits therein, which surety bonds or insurance policies shall satisfy the requirements of this section 4.09, and to do or cause to be done all acts necessary to accomplish such substitution.
SECTION 2. Upon exercise of the authority granted by Section 4.09 of the General Ordinance as amended by Section 1 of this Ordinance, the Director of Finance is hereby authorized to do or cause to be done all acts necessary to transfer the resulting excess money in the Debt Reserve Account established under the General Ordinance to the Revenue Fund established under the General Ordinance, as permitted by Section 4.09 of the General Ordinance.
SECTION 3. Section 4.12 of the General Ordinance, entitled Residual Fund is hereby amended to add the following subsection:
4.12.01. Special Water Infrastructure Account
(a) There is established within the Residual Fund, pursuant to Section 4.12(ii), an account to be known as the Special Water Infrastructure Account. In the event that there is a substitution of appropriate surety bonds or insurance policies for some or all of the deposits held in the Debt Reserve Account, a transfer of resulting excess money in the Debt Reserve Account to the Revenue Fund and, following compliance with Section 4.06 hereof (entitled Transfer from Revenue Fund to Other Funds and Accounts), a transfer of remaining amounts of such excess to the Residual Fund, such remaining amount shall be deposited into the Special Water Infrastructure Account.
(b) Any amounts deposited in the Special Water Infrastucture Account may be used to finance water-related infrastructure projects. Amounts deposited in the Special Water Infrastructure Account may be applied at the written direction of the City to payments for the cost of renewals, replacements and improvements to the System or any acquisitions of the same consistent with the New River City Program Description and proposed budget attached hereto as Exhibit A.
EXHIBIT A
New River City Initiative
Since Mayor Street announced his visionary New River City initiative in early 2004, the Administration's public investment in planning, site assemblage and infrastructure has helped to stimulate widespread private investment along our waterfront.
Project Objective: Enhance the development of Philadelphia's historic riverfronts and neighborhoods in a way that guarantees the public enjoyment and protection of our City's water resources.
The New River City Initiative focuses on coordinating the City's efforts toward the riverfronts in order to redefine and improve the City's relationship to its rivers, waterfronts, and the surrounding communities. By establishing a set of priorities and goals for development to promote and advance Philadelphia's riverfronts as desirable locations, the City anticipates the redevelopment of thousands of acres of vacant land. The reuse of vacant land along the rivers will create communities of new urban housing, modern retail, office, and manufacturing space for technology companies, and create waterfront recreational amenities that will attract and retain knowledge industry residents and jobs and improve public access to the waterfront.
The City will utilize $125 million in funds available in the Special Water Infrastructure Account to accelerate the development of New River City public water and sewer infrastructure. The City's financial commitment will be augmented by State and Federal resources, creating opportunities for private developers to commit significantly greater levels of capital in anticipation of market rate returns. By overseeing, coordinating and managing the completion of public infrastructure work, the City anticipates stimulating widespread private investment along our waterfront while ensuring public access - both physical and visual - to the waters edge.
The Economic Blueprint establishes a framework to revitalize Philadelphia's riverfronts and includes the following objectives:
- Cooperate with the stakeholders in the North Delaware region and identify an appropriate City role in implementation of Philadelphia City Planning Commission's Master Plan.
- Coordinate development of the Central waterfront district as a residential, commercial and entertainment destination, and expand the infrastructure necessary to support industrial activities surrounding the port
- Continue to support the Schuylkill River Development Corporation in the implementation of its mixed-use Master Plan.
- Pursue the redevelopment of the Navy Yard in accordance with Philadelphia Industrial Development Corporation's mixed-use Master Plan.
- Coordinate existing City resources and leverage other resources to sustain the advances achieved under the Neighborhood Transformation Initiative.
Water Bond Proceeds
The following program descriptions and chart provides details of the amounts, types of activities, and eligible uses that make up the total program budget for the $125 million in funds available in the Special Water Infrastructure Account. All projects will be capital eligible as determined by the City with the written approval of Bond Counsel with the specific requirement that:
- Funds are used for public water, wastewater, and/or stormwater infrastructure.
- Improvements are located in public streets or right-of-way and City owns title to the infrastructure/right-of-way.
- Infrastructure meets city, state, federal standards, specifications, rules, regulations, ordinances, and Private Cost Contract Requirements.
- Water mains are able to provide adequate fire protection.
- Design and installation/construction are in accordance to Water Department standards and approved/inspected by the Department.
Program Categories and Funding Allocations:
- Residential and Commercial Development
Funding assistance to facilitate the installation of publicly-owned water and sewer infrastructure with a particular focus on the management of stormwater that incorporates its direct drainage into tidal waters for waterfront development, infiltration into the site where feasible, and the establishment, where possible, of public easements along the river corridor for public access and recreation. Funding will be prioritized for riverfront development that leverages private investments, captures and targeted manages stormwater runoff beyond the volume required by the City's Stormwater Regulations (effective January 1, 2006), and preserves and enhance the city prescribed riverfront greenway requirements. Projects will be competitively chosen based on the selection criteria discussed below.
- Navy Yard Infrastructure Modernization
With the City's release of the 2004 Navy Yard Master Plan last September, the City and the Philadelphia Industrial Development Corporation now have a comprehensive master plan to guide the development of the next 500 acres of mixed-use development at this 1,200-acre site. This dynamic plan calls for a total build-out of more than 10 million square feet supported by $2 billion in private investment. Funding will replace and/or rehabilitate the existing water and sewer infrastructure to ensure that all water and sewer utilities meet the Water Department's design standards and are equipped to meet the efficient, environmentally friendly and safe water delivery and drainage demands of future development.
- Riverfront Public Infrastructure
Funding will be provided for the installation of underground stormwater or sewage detention facilities that significantly reduce the occurrence of overflows of untreated wastewater into the city's rivers. The funding of these projects will result in the protection of public waterfront investments and the assurance that the city's river resources are enhanced as a public and aesthetic amenity that leverage private development opportunities. The funding will also serve to alleviate significant flooding that has occurred in a variety of city neighborhoods as a result of stormwater volumes generated by extreme rain storms that overburden the city's sewer system. Riverfront public infrastructure projects will be selected based on timing of construction and positive impact on communities.
Funding assistance to implement stormwater management features in neighborhoods on publicly owned, contiguous vacant lot parcels, publicly subsidized funded housing, city parking lots, recreation and other facilities and public schools to provide the maximum benefit to the city's sewer infrastructure. These projects need not be located along the riverfronts, but must be designed to manage the stormwater runoff from adjacent blocks in addition to the runoff generated by the site itself. Stormwater management components may include a combination of greening and stormwater retention structures that will also serve as a public amenity.
New River City Program Budget
New River City Activity |
Budget |
Projects |
|
Residential and Commercial Development |
40,000,000 |
Navy Yard Modernization |
30,000,000 |
Riverfront Public Infrastructure |
30,000,000 |
Green City Strategy |
25,000,000 |
|
|
Total |
125,000,000 |
Project Selection
The Commerce Department will coordinate the review of all eligible proposals by a selection committee comprised of representatives from the Office of Housing and Neighborhood Preservation, City Planning Commission, the Managing Director's Office, the Water Department, Office of Neighborhood Transformation Initiative, and the Commerce Department. A report with a summary status of all projects funded under the New River City Initiative will be provided to City Council annually by the Commerce Department.
Selection among competing projects within each funding category will be based on conformance with the following criteria:
- Developer has site control and evidence of financing; indicating development is ready to build within the next 24 months.
- Project supports New River City, NTI, or other established Administration priorities, contributing to the economic vitality of the neighborhood and City.
- Proposed development is consistent with the master plan for the surrounding area and conforms to the design criteria provide by the Planning Commission.
- Developer will provide the City with a water utilization study or other projections illustrating how investment will add to the water ratepayer base and tax base.
- Project maximizes private and other public funding to leverage New River City funds.
- Development will provide enhanced public access amenities (i.e. create recreation, open space uses), and will plan to mitigate stormwater runoff from the proposed project sites (i.e. stormwater mixing with wastewater).
- The development takes preventive measures beyond existing Water Department requirements to protect the region's water environment by safeguarding the river's edge by increasing the greenery along the riverfront (trees, grass, plants) - absorbs runoff and reducing flow to water treatment facilities.
- Project incorporates energy performance measures and promotes sustainable energy management practices.
Project Administration
The Commerce Department will contract with the Philadelphia Industrial Development Corporation (PIDC) to administer the New River City Program. Services to be provided include: marketing the program to developers and other interested parties; managing the application process; disbursement of funds upon proper authorization, including the Water Department engineering staff as appropriate; cash management services; preparation official reports as requested and assistance to the Selection Committee.
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