1. Rapid Assessment Process Project Strategic Plan City of Alamo Municipal Water and Wastewater Project Hidalgo County, Texas Presented to: Project Sponsor and BECC Staff Transition Meeting December 19, 2002

2.  General Aspects  Environmental and Human Health Indicators  Technical Approach, Objectives and Funding Plan  Public Participation  Sustainable Development  Record of Project Coordination Agenda

3. General Aspects Project Location  City of Alamo is located in Hidalgo County, Texas between McAllen and Harlingen. The community is 10 miles north of the U.S./Mexican Border.

4. State of Existing WTP and Distribution System  Originally constructed in the 1920s and last upgraded in 2002.  Systems include a 5.0 MGD WTP, storage reservoir, clarifiers and filters.  The water storage capacity includes two elevated storage tanks (150,000 and 300,000 gallons respectively) and two ground storage tanks (1 million gallons each).  The water distribution system includes approximately 370,000 linear feet of distribution water lines and 3,750 retail water connections.  Concerns: No back-up generator for emergencies. Deteriorating elevated water storage tanks. Exceedance of contaminant levels for total trihalomethanes (TTHM) in the public water system. Additional water rights. Water breaks due to current pressure from new WTP. Proposed Water Treatment System Improvement Project  Upgrade and refurbish an elevated water storage tank.  Improvements to the WTP systems to address TTHM levels and pressure problems.  Addition of back-up power supply to the WTP.  Improvements to eliminate water loss at HCID#2 diversion point.  Additional Water Rights General Aspects

5. State of Existing WWTP and Collection System  The system includes a WWTP with a capacity of 2.0 MGD and consists of 8 lagoons located on 45 acres.  Sludge left in the first lagoon and deteriorating lagoon embankments and perimeter fence.  The wastewater collection system contains 19 lift stations and over 286,000 linear feet of sewer lines. Most of these sewer lines are located near the center of town. Approximately 40 % of the original clay pipe lines have been replaced with PVC lines.  Approximately 100 original brick lined manholes with infiltration and inflow problems during rain events need replacement.  Concerns: Expansion of WWTP based on TCEQ’s inspection findings on capacity. Overall maintenance of WWTP site. Deteriorating lift stations, brick lined manholes and clay pipes. Facility inventory. Proposed Wastewater Treatment System Improvement Project  Improvements to lift stations, brick lined manholes, clay pipes and the addition of an SCADA system.  Sludge removal in the first lagoon, lagoon embankment repair work and replacement of perimeter fence. General Aspects

6. Total Estimated Cost: TBD (Based on STEP I Application) General Aspects

7.  Population: 14,760  Growth rate (90-00): 79.8%  MHI: $23,928.00  Unemployment rate: 8.7%  Legal utility provider  3,750 water accounts  3,560 sewer accounts  17 employees (7 certified operators)  Billing efficiency: 99 %  USDA – infrastructure funding for construction of new 5.0 MGD WTP and rehabilitation of City streets. The City issued a Certificate of Obligation for $2.9 million for the same project.  CDBG – funding provided for reconstruction of streets, waterlines and stormwater drainage in colonias.  EDA – funding for expansion of WWTP in 1992.  No prior BECC or NADB assistance.  1994 – WTP study for WTP expansion. Project Sponsor Profile:Prior Agency Support and Existing Studies:

8. Human Health Indicators  Water distribution deficiencies show existing WTP capacity is not adequate to meet peak demands or fire protection demands.  TTHM levels have created deficiencies in water quality and threat to the health and safety of the City’s residents.  Although existing statistics are not specific to the City of Alamo, the Texas DOH has indicated that cases of Cryptosporidiosis and Amebiasis have been reported in Hidalgo County. The number of cases per 100,000 people are as follow: Environmental and Human Health Indicators YearDisease CaseRegion 11: Hidalgo CountyTexas (All Other Regions) 1997Cryptosporidiosis0.10 – 0.8 Amebiasis1.70 – 1.2 1998Cryptosporidiosis0.60 – 43.2 Amebiasis1.40 – 1.0 1999Cryptosporidiosis0.50 – 1.1 Amebiasis00 – 1.3

9. Environmental Indicators  The improvements to the WTP and WWTP systems will enhance and protect the general health of the population and environment.  Improvements will eliminate deteriorating lift stations, infiltration problems in clay pipes and brick lined manholes, which increase risk for potential groundwater contamination.  Wastewater service to colonias and subdivisions around the City will help reduce and eliminate the current discharge of wastewater into septic and outdoor systems. Environmental and Human Health Indicators

10. Compliance with Environmental Norms & Regulations Including Violations  To comply with TCEQ’s requirements, the City must initiate planning for the expansion of the existing wastewater treatment plant when the influent flow reaches 75 % of the permitted average daily flow for three consecutive months.  Additional compliance with the regulations requires the City to take proper measures to reduce the exceeding maximum contaminant levels for total trihalomethanes (TTHM) in the public water system – Community has taken action on this item. Environmental and Human Health Indicators

11. Project Objectives  Rehabilitation and expansion of the water distribution and wastewater collection system.  Expansion of the wastewater treatment plant.  Refurbishing of an elevated storage water tank and improvements to the water treatment plant. Technical Approach  Technical Assistance needed to develop the following documents:  Facility Plan and EID for water and wastewater systems.  Financial Analysis.  Public Participation Program.  Final Design.  Rate Study. Technical Approach, Objectives and Funding Plan

12. Identified Potential Funding Sources  Texas Water Development Board (TWDB)  Funds may be available through TWDB Dfund II, EDAP and CWTAP  North American Development Bank (NADB)  BEIF and IDP  Border Environment Cooperation Commission (BECC)  PDAP program  US Army Corps of Engineers Technical Approach, Objectives and Funding Plan

13. Project Sponsor Financial Potential Revenues and Expenditures Summary (millions) 1999 2000 2001 Revenues$1.4 $1.5 $1.4 Expenses$1.1 $1.2 $1.1 Net Available from Operations$0.3 $0.3 $0.4 Existing Debt:$2.9 millionAnnual Debt Service: $TBA (Bond due in installments of $7,000 to $155,000 thru August 2040 at interest of 4.5 percent.) Water WW Average Monthly Bill:$13.50$7.00 Technical Approach, Objectives and Funding Plan

14. PDAP Eligibility Criteria 1) Financial strategy for the entire projectYes 2) Project sponsor awareness of technical aspects of projectYes 3) Project sponsor has provided demonstration of documentationYes support for the project 4) BEIF financing eligibleYes 5) C.N.A. and/or state/local gov. support, for projects in MexicoNA 6) Funds allocated on a per task basisYes 7) Project coordination with all government agencies involvedYes 8) Value engineering as required under BEIF programYes Technical Approach, Objectives and Funding Plan

15. BEIF Eligibility Criteria 1) Project located within 100 km of the borderYes 2) Project addresses a human health and/or ecological issueYes 3) Project provides U.S. side benefitsYes 4) Project scope entails community infrastructure in W/WWYes 5) Project sponsor to pursue Certification of ProjectYes 6) Drinking water projects – quality of water only, not raw water supply Yes 7) Projects have a funding strategy with funding sources identifiedYes 8) Projects that discharge into U.S. side waters to target US normsYes 9) Payment and benefit to public entity only not private sectorYes 10) For final design must meet eligibility requirementsNA 11) Colonias projects, after 06-01-01, eligibility based on established Yes enforceable ordinances preventing exacerbation or new ‘colonias’ Technical Approach, Objectives and Funding Plan

16. Task NameDurationStartFinish Application Process11 days07/25/0208/08/02 Rapid Assessment Process89 days08/19/0212/19/02 Technical Assistance Process29 days12/03/0201/24/03 Project Development Process (TA, Public Participation, NEPA) 522 days12/16/0212/28/04 Project Design Process325 days10/01/0312/28/04 TWDB Funding66 days10/01/0312/31/03 NADB Rate Study67 days05/13/0408/13/04 BECC Certification Process39 days10/18/0412/09/04

17. Agency Perspectives NADB:  An initial analysis of the proposed project in regards to BEIF eligibility criteria provides a sense that the project will be eligible for this program.  An affordability will be completed to determine any participation with BEIF grants including construction, hook- up and transition support.  Loan assistance can be available for construction and potential support may be provided by the IDP for completion of a rate study and other institutional capacity building needs. Technical Approach, Objectives and Funding Plan

18. Agency Perspectives TWDB:  Because the project will address recently annexed colonias, this project may be eligible for EDAP funding through TWDB.  Water Rights purchases may be an eligible activity supported by EDAP if the need for the additional supply is related to the new service provided to the colonias.  Project will meet criteria for application to SRF and Dfund II. Technical Approach, Objectives and Funding Plan

19. Technical Assistance Tasks TaskAmount Water and Wastewater Facility Plan$160,000 Environmental Information Document$ 40,000 Financial Analysis$ 20,000 Public Participation Program$ 10,000 Project Certification Document$ 20,000 Final DesignTBD TOTAL$250,000 Technical Approach, Objectives and Funding Plan

20. Institutional Capacity Building  The project sponsor identified such needs as a capital improvement plan, rate study and the development of public participation programs.  The Frank M. Tejeda Center has conducted an Institutional Capacity Needs Assessment with the City of Alamo. Technical Approach, Objectives and Funding Plan

21. Institutional Capacity Building  In specific, observations were made pertaining to:  Current Operating Violations  Other Infrastructure Projects Ongoing or Planned  Planning  Project Development and Funds Management  Outsourcing  Operational Capacity  Management Capabilities  Governance  Other Issues Technical Approach, Objectives and Funding Plan

22. Potential Obstacles  The City of Alamo informed the BECC that some potential obstacles for the implementation of this project may include water rights acquisition, public perception of water quality issues given existing litigation related to levels of total trihalomethanes (TTHM) and wastewater treatment plant technology, or site changes.  Although the City has a water CCN inter-local agreement with the City of San Juan, no obstacles are anticipated to meet the proposed project objectives.  Improvements and planning should take into consideration that the City’s population does not reflect additional winter Texans (between 6,000 and 7,000) that come to the area for approximately 5-months every year. Technical Approach, Objectives and Funding Plan

23. Identification of Main Stakeholders  City of Alamo and its residents  Texas Water Development Board  Texas Commission on Environmental Quality  North American Development Bank  Frank M. Tejeda Center  Border Environment Cooperation Commission  United States Department of Agriculture  Secretary of State  US Army Corps of Engineers Public Participation

24. Local Politics  The Mayor has been in office for the past 10-14 years.  Mayor and four commissioners, with a four-year election term, and one municipal judge with a two-year, are all elected at large.  The relatively new commission recently approved the bond issuance to support the WTP improvements and also passed rate increases for the utility, displaying their commitment to sustainable operations. Public Participation

25. Minimum Criteria Requirements  The City of Alamo made a commitment to comply to all applicable minimum requirements for the project in compliance with the BECC’s sustainable development criteria during the meeting held on August 22, 2002 at the local City Hall, with BECC, SOS and the Frank M. Tejeda Center. Sustainable Development

26. Service Indicators  Water service indicators: all available water service indicators were recorded, identifying all relevant factors for the proposed infrastructure project in the City of Alamo.  Sewer service indicators: all available sewer service indicators were recorded in relevance to the proposed project.  Wastewater service indicators: all available wastewater service indicators were recorded in relevance to all factors of the proposed project. Sustainable Development

27.  Financial Potential – separate accounts, identify reserves and policy.  Formation of Steering Committee.  Not Available Water, Sewer and Wastewater Service Indicators.  Population of Future Colonias that will Become Part of the City’s System.  Consultant Proposal. Immediate Action Items