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O-39-24 Authorizing the Village of Lemont, Cook, DuPage and Will counties, Illinois to borrow funds from the Public Water Supply Loan Program of the Illinois Environmental Protection Agency (IEPA).0- �yj -� q 413 Main Street 1 Lemont, II.,.. 60439 TO: Village Board Meeting FROM: Darshana Prakash, Finance THROUGH: George Schafer, Village Administrator SUBJECT: An Ordinance Authorizing the Village of Lemont, Cook, DuPage and Will counties, Illinois to borrow funds from the Public Water Supply Loan Program of the Illinois Environmental Protection Agency (IEPA). DATE: November 25, 2024 SUMMARY/BACKGROUND This agenda item was discussed by the Village Board at the November 18, 2024 Committee of the Whole meeting. The inventory of lead service lines that need to be replaced within the Village was submitted to the Illinois Environmental Protection Agency (IEPA) in April 2024. Of the total, 35 lead service lines will be replaced in late FY25/early FY26 for a total cost of $560,000. Being that this mandate is costly and spans over several years, the IEPA provides funds through its Public Water Supply Loan Program (PWSLP). The loan is at a 0% interest rate for a term of 30 years. Staff recommends availing of this zero interest loan which has a budgetary impact of $19,000 in the first year in the Water Fund. The repayment of the loan will be from water revenues and if necessary from sales tax revenues (as a loan from General Fund). Staff is recommending that the Board approve the loan agreement between the Village and the IEPA. ANALYSIS Consistency with Village Policy STAFF RECOMMENDATION Approve the Ordinance. BOARD ACTION REQUESTED Approve the Ordinance. ATTACHMENTS LOAN AGREEMENT AUTHORIZING ORDINANCE 2024.pdf ORDINANCE NUMBER 0 AN ORDINANCE authorizing the Village of Lemont, Cook, DuPage and Will Counties, Illinois to borrow funds from the Public Water Supply Loan Program of the Illinois Environmental Protection Agency. WHEREAS, the Village of Lemont, Cook, DuPage and Will Counties, Illinois (the "Village") operates its combined waterworks and sewerage system (the "System") in accordance with the provisions of the Illinois Municipal Code (65 ILCS 5/11-139) and the Local Government Debt Reform Act of the State of Illinois (the "State"), 30 ILCS 350/1 (collectively, the "Act"), and WHEREAS, the President and the Board of Trustees of the Village (the "Corporate Authorities") have determined that it is advisable, necessary and in the best interests of public health, safety and welfare of the Village and its residents to make improvements to the System, including, but not limited to, replacement of 35 residential lead water service lines and any and all other System -related projects and improvements in connection thereto, together with any land or rights in land and all electrical, mechanical or other services necessary, useful or advisable to the constriction and installation (collectively, the "Project"), all in accordance with the plans and specifications prepared by consulting engineers of the Village, which Project has a useful life of 50 years; and WHEREAS, the estimated cost of construction and installation of the Project, including engineering, legal, financial, and other related expenses is $560,000, and there are insufficient funds on hand and lawfully available to pay these costs; and WHEREAS, the loan shall bear an interest rate as defined by 35 Ill. Adm. Code 662, which does not exceed the maximum rate authorized by the Bond Authorization Act, as amended, 30 ILCS 305/0.01 et seq., at the time of the issuance of the loan; and 4 2 891908.2/08 8 8 88.05277 WHEREAS, the principal and interest payment shall be payable semi-annually, and the loan shall mature in 30 years, which is within the period of useful life of the Project; and WHEREAS, the costs are expected to be paid for with a loan to the Village from the Public Water Supply Loan Program (the "Loan") through the Illinois Environmental Protection Agency (the "IEPA"), the Loan to be repaid from the (i) Net Revenues (i.e., gross revenues minus operations and maintenance expenses) of the System and (ii) taxes imposed by the State and distributed to the Village pursuant to the Illinois Use, Service Use, Service Occupation, and Retailers Occupation Tax Acts (collectively, the "Pledged Revenues"), and the Loan is authorized to be accepted at this time pursuant to the Act; and WHEREAS, the Loan to the Village shall be made pursuant to a Loan Agreement, including certain terms and conditions, between the Village and the IEPA; and WHEREAS, in accordance with the provisions of the Act, the Village is authorized to borrow fiends from the Public Water Supply Loan Program of an aggregate principal amount of not to exceed $560,000 to provide funds to pay for a portion of the costs of the Project; NOW THEREFORE, Be It Ordained by the Corporate Authorities of the Village of Lemont, Cook, DuPage and Will Counties, Illinois, as follows: SECTION 1. INCORPORATION OF PREAMBLES The Corporate Authorities hereby find that the recitals contained in the preambles are true and correct and incorporate them into this Ordinance by this reference. SECTION 2. DETERMINATION TO BORROW FUNDS It is necessary and in the best interests of the Village to construct the Project for the public health, safety and welfare, in accordance with the plans and specifications, as described; that the System continues to be operated in accordance with the provisions of the Act; and that for the 42891908.2/088888.05277 purpose of constructing the Project, it is hereby authorized that funds be borrowed by the Village in an aggregate principal amount (which can include construction period interest financed over the term of the Loan) in one or more draws not to exceed $568,400. SECTION 3. SECTION 3. PUBLICATION This Ordinance, together with a Notice in the statutory form (attached hereto as Exhibit A), shall be published once within ten (10) days after passage in My Suburban Life or the Daily Southtovvn, each a newspaper published and of general circulation in the Village, and if no petition, signed by electors numbering 10% or more of the registered voters in the Village (i.e., 1,388 or more) asking that the question of improving the System as provided in this Ordinance and entering into the Loan Agreement therefore be submitted to the electors of the Village, is filed with the Village Clerk within 30 days after the date of publication of this Ordinance and notice, then this Ordinance shall be in full force and effect. A petition form shall be provided by the Village Clerk to any individual requesting one. SECTION 4. ADDITIONAL ORDINANCES If no petition meeting the requirements of the Act and other applicable laws is filed during the 30-day petition period, then the Corporate Authorities may adopt additional ordinances or proceedings supplementing or amending this Ordinance providing for entering into the Loan Agreement with the IEPA, prescribing all the details of the Loan Agreement, and providing for the collection, segregation, and distribution of the Pledged Revenues, so long as the maximum amount of the Loan Agreement as set forth in this Ordinance is not exceeded and there is no material change in the Project or purposes described herein. Any additional ordinances or proceedings shall in all instances become effective in accordance with the Act or other applicable 42891908.2/088888.05277 law. This Ordinance, together with such additional ordinances or proceedings, shall constitute complete authority for entering into the Loan Agreement under applicable law. However, notwithstanding the above, the Village may not adopt additional ordinances or amendments which provide for any substantive or material change in the scope and intent of this Ordinance, including but not limited to interest rate, preference, or priority of any other ordinance with this Ordinance, parity of any other ordinance with this Ordinance, or otherwise alter or impair the obligation of the Village to pay the principal and interest due to the Public Water Supply Loan Program without the written consent of the IEPA. SECTION 5. LOAN NOT INDEBTEDNESS OF VILLAGE Repayment of the Loan to the IEPA by the Village pursuant to this Ordinance is to be solely from the Pledged Revenues, and the Loan does not constitute an indebtedness of the Village within the meaning of any constitutional or statutory limitation. SECTION 6. APPLICATION FOR LOAN The President is hereby authorized to make application to the IEPA for a loan through the Public Water Supply Loan Program, in accordance with the loan requirements set out in 35 Ill. Adm. Code 662. SECTION 7. ACCEPTANCE OF LOAN AGREEMENT The Corporate Authorities hereby authorize acceptance of the offer of a loan through the Public Water Supply Loan Program, including all terms and conditions of the Loan Agreement as well as all special conditions contained therein and made a part thereof by reference. The Corporate Authorities further agree that the loan funds awarded shall be used solely for the purposes of the Project as approved by the IEPA in accordance with the terms and conditions of the Loan Agreement. 42891908.2/088888.05277 SECTION 8. OUTSTANDING BONDS The Village has outstanding bonds that are payable from revenues of the System, but the outstanding bonds are not senior to, but on parity with, the loan authorized by this Ordinance. SECTION 9. AUTHORIZATION FOR PRESIDENT TO EXECUTE LOAN AGREEMENT The President is hereby authorized and directed to execute the Loan Agreement with the IEPA. The Corporate Authorities may authorize by resolution a person other than the President for the sole purpose of authorizing or executing any documents associated with payment requests or reimbursements from the IEPA in connection with the Loan. SECTION 10. SEVERABILITY If any section, paragraph, clause or provision of this Ordinance is held invalid, the invalidity of such section, paragraph, clause or provision shall not affect any of the other provisions of this Ordinance. SECTION 11. REPEALER All ordinances, resolutions or orders, or parts thereof, which conflict with the provisions of this Ordinance are, to the extent of such conflict, hereby repealed. THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK 42891908.2/088 888.05277 PASSED by the Corporate Authorities on November 25, 2024. Approved November 25, 2024. ;resident Village of Lemont Cook, DuPage and Will Counties, Illinois AYES: NAYS: ABSENT: RECORDED in the Village Records on November 25, 2024. ATTEST: Village Cleric Village of Lemont Cook, DuPage and Will Counties, Illinois 42891908.2/088 888.0 527 7 EXHIBIT A NOTICE OF INTENT TO BORROW FUNDS AND RIGHT TO FILE PETITION NOTICE IS HEREBY GIVEN that, pursuant to Ordinance Number 1- adopted on November 25, 2024, the Village of Lemont, Cook, DuPage and Will Counties, Illinois (the "Village"), intends to enter into a Loan Agreement with the Illinois Environmental Protection Agency in an aggregate principal amount not to exceed $560,000 and bearing annual interest at an amount not to exceed the maximum rate authorized by law at the time of execution of the Loan Agreement, for the purpose of paying the cost of certain improvements to the public water supply system of the Village. A complete copy of the Ordinance is attached hereto and appears below this notice. NOTICE IS HEREBY FURTHER GIVEN that if a petition signed by 1,388 or more electors of the Village (being equal to 10% of the registered voters in the Village), requesting that the question of improving the public water supply system and entering into the Loan Agreement is submitted to the Village Clerk within 30 days after the publication of this Notice, the question of improving the public water supply system of the Village as provided in the Ordinance and Loan Agreement shall be submitted to the electors of the Village at the general primary election to be held on the 17th day of March, 2026. A petition form shall be provided by the Village Clerk at the principal office of the Village, located at 418 Main Street, Lemont, Illinois. /s/ Charlene Smollen /Z�//-Z Village Cleric, Village of Lemont, Cook, DuPage and Will Counties, Illinois 42891908.2/088 888.05277 PETITION To the Village Clerk of Village of Lemont, Cook, DuPage and Will Counties, Illinois (the "Village"): We, the undersigned, being registered voters of the Village, do hereby petition you to cause the question of the Village improving the public water supply system and entering into a loan agreement (the "Loan") for the purpose of paying the cost of certain improvements to the public water supply system of the Village, with said Loan to be repaid from the (i) Net Revenues (i.e., gross revenues minus operations and maintenance expenses) of the System and (ii) taxes imposed by the State of Illinois and distributed to the Village pursuant to the Illinois Use, Service Use, Service Occupation, and Retailers Occupation Tax Acts to be certified to the County Clerks of Cook, DuPage and Will Counties, Illinois, and submitted to the respective electors of said County at the next election to be held at which said question may be voted upon. Name Address County Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois Lemont, County, Illinois I, of (insert residence address), Illinois, do hereby certify that I am a citizen of the United States and at least 18 years of age or older, and in the County of , Illinois, and that the signatures on this petition were signed in my presence, and are genuine, and, to the best of my knowledge and belief, the persons so signing were at the time of signing this petition registered voters of said Village and that their respective addresses are correctly stated herein. Subscribed and sworn to before me this day of , 2024. Illinois Notary Public My Commission Expires: 4289 1908.2/088888.05277