1. Welcome! February 10, 2015

2. Presented by: Steve Dunk (Public Works Board) Cathy Brockmann (Contracts Administration Unit) 2

3.  What’s New?  Overview of the 2015 DWSRF Handbook – *Two changes to the handbook (“Super Circular” & IGEA) *key points *valuable resource *usable attachments  What’s Next?  Contacts  Q & A 3

4. 20 Year Contract Loan repayment terms have changed from 24 years to 20 years. Exceptions to the 20 year contract will be provided to those receiving loan forgiveness. Repayment An interest-only payment will be due the first October after contract execution while the second year will begin both principal and interest for the remaining of the loan term. If you do not draw any funds in the first year, your payment in year two will be both interest and principal. 18 Month Notice to Proceed Projects must issue a Notice to Proceed (NTP) within 18 months of contract execution. The Public Works Board (Board) will need to approve extensions that go beyond 18 months. 4

5. 2 CFR 200 Subpart F Federal Audit (“Super Circular”) will apply to your project if your city, town or water system has spent more than $750,000 of any federal money within your fiscal year. This is a new audit requirement that replaces the Circular A -133 (which had a $500,000 trigger). American Iron and Steel Congress passed a law that requires water systems to use U.S. steel and iron products for projects funded in part or in full by a DWSRF loan. The requirement applies to loan agreements signed on or after January 17, 2014. You can find the specific Buy American Iron and Steel language in HR3547, Consolidated Appropriations Act 2014. 5

6. Section 1 - Getting Started Section 2 - Contract Amendments & Implementation checklist Section 3 - Record Keeping & Reporting Section 4 - Financial Management Section 5 - Procuring Professional Services Section 6 – Environmental & Cultural Review Section 7 – Procuring Construction Contracts Section 8 – Investment Grade Efficiency Requirement Section 9 – Managing Your Construction Project 6

7. “ Your Partners”  Department of Health - Eligibility, scoring, rating & ranking, scopes of work…  Public Works Board – Underwriting of the DWSRF loan, calculating affordability index (AI), coordinating contract data  Contracts Administration Unit – Contract training, monitoring compliance, reimbursement, contract amendments, contract preparation Starting on pg. 3 7

8.  A 1% loan fee will be administered to borrowers at the time of contract execution (if applicable)  Notice to Proceed must be issued within 18 months of contract execution  Projects must be completed within 48 months of contract execution  Annual loan payments will begin the first October after contract execution.  Establishment of adequate rates and reserves during the term of the loan as required by your Water System Management Plan 8

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11.  Any scope of work amendment will need Department of Health (DOH) approval before proceeding i.e. extending the footprint, depth of the pipe…  Extensions to your Notice to Proceed and Project Completion can be requested but will require DOH and Public Works Board approval.  Contract check list – great tool & guide (pg. 18 - 20) Starting on pg. 15 11

12.  Good Record keeping is essential in order to document compliance.  A suggested method is listed (pg. 25)  Each request for payment must be accompanied with a Project Status Report  The borrower must submit DOH’s Construction Completion Report to close a project Starting on pg. 23 12

13.  2 CFR 200 Subpart F Federal Audit (“Super Circular”) will apply to your project if your city, town or water system has spent more than $750,000 of any federal money within your fiscal year. This is a new audit requirement that replaces the Circular A -133 (which had a $500,000 trigger).  All pre-construction activities directly related to your DWSRF scope of work can be reimbursed  Required activities prior to construction *Environmental review *Section 106 Cultural Review *21 day labor package - Cert. payroll review, prevailing wage requirements, etc.  Borrowers do not need to pay invoices prior to submitting payment *Include back-up documentation *Can be submitted electronically (if less than 25 pgs.) Starting on pg. 27 13

14.  Borrowers that already have staff or consultants working for their community may use them for their DWSRF project  Borrowers without a consultant will have to publish a request for professional services in a newspaper of general circulation  Document why you selected the firm/consultant and how they are most qualified for the job  Check for Federal Exclusion!! Starting on pg. 43 14

15.  Borrowers shall not move forward with any pre-construction activities i.e. test wells, geo-technical investigations, etc. until the cultural/environmental review is complete  Turn your EZ – 1 form in to the Dept. of Health!!  The Department of Health will be in contact soon to assist you in completing this requirement. Starting on pg 49 15

16.  An Invitation for Bid (IFB) is the usual process for procuring a construction contractor  Projects must be under $300,000 to use a small works roster  Send your IFB to your CAU Project Manager prior to advertising your bid requirements  Disadvantaged Business Enterprises & Fair Share goals *Construction 10% MBE 6%WBE *Supplies 8% MBE 4%WBE *Equipment 8% MBE 4%WBE *Purchased Services 10%MBE 4%WBE Starting on pg. 55 16

17.  Six Good Faith Efforts (pg. 61)– demonstrating you are trying to meet the DBE goals.  DBE reporting forms  Bid specifications – ensuring all provisions are included (pg. 59)  Obtain your federal wage decision – carpenter, welder, backhoe operator… use your CAU project manager!!  Wage rates & the ten (10) day bid check  Conduct the bid opening  Contractor eligibility – Federal Excluded Parties List * useful attachments in the back of chapter 7* Starting on pg. 55 17

18. Starting on pg. 143 18  The primary purpose of the IGEA is to assure that infrastructure projects using electricity, motors, or pumps evaluate the efficiency of the equipment being considered.  Does this mean that every water system that applies for a DWSRF loan needs to do an audit? No.  What it does mean is that your infrastructure project needs to demonstrate & document one of the following:

19. 19 1.Documentation that you have had an energy review prior to your loan request through your power provider (PSE, BPA, PUD…) or an Energy Services Company (ESCO) 2.A third party design review may be more appropriate for projects that are brand new or are having major upgrades to their systems. If a project is unable to measure the system before and after the infrastructure project, an IGEA is not possible. An energy expert can be sub-contracted to review designs and specifications for potential energy savings. 3.Demonstrate that the project under consideration has “no obtainable” energy savings. Generally, projects with only pipe and pavement are examples where energy savings is not obtainable. However, if your road project has lighting included, it needs to be considered under the IGEA requirement. 4.Complete a preliminary audit through an Energy Service Company (ESCO) to determine if there are potential long-term energy savings. If the preliminary report demonstrates that savings are obtainable a full audit of the “project” is the next step. For more information regarding the IGEA, Roger Wigfield at the Department of Enterprise Services 360/407-9371, roger.wigfield@des.wa.govroger.wigfield@des.wa.gov

20.  Conduct a preconstruction conference – who’s doing what?! *Engineer *Contractor *Borrower  Davis Bacon Requirements  Notice to Proceed  Payroll Review  On-site Monitoring Your CAU project manager will be conducting a training on all of the above – You’ll want to take part! Starting on pg. 147 20

21.  PWEB Training  CAU Contracts Training  CAU Labor Standards  Contract Implementation Check list pg. 18-20  Quick References in handbook pg. 21 21

22.  Contracts will be sent soon for authorization and signature  Sign your contract and return it to the Department of Commerce  The Public Works Board Chairman will sign and execute your contract  Your CAU project manager will be in contact soon!  Get started on your Cultural/Environmental Review asap.. 22

23.  Department of Health Drinking Water SRF Program, Karen Klocke, karen.klocke@doh.wa.gov karen.klocke@doh.wa.gov (360) 236-3116  Public Works Board, Steve Dunk, stephen.dunk@commerce.wa.govstephen.dunk@commerce.wa.gov (360) 725-3157  Contract Administration Unit, Cathy Brockmann, cathy.brockmann@commerce.wa.gov cathy.brockmann@commerce.wa.gov (360) 725-3087 23

24. 24 Questions?