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3/9/2010 <br />Project Financing <br />o Reserves are not adequate to fund the <br />project using pay as you go <br />o Many of the elements, if bid and built <br />separately, would be much more costly <br />o Stimulus money may become available on <br />1St come, 1St served basis at any time <br />o SRF loan rates set at 50% of Municipal <br />Bond rate <br />o Currently, the SRF rate for San Leandro <br />would be 2.6% fora 30 year loan <br />o The savings over 30 years is $28 mil ' <br />SUMMARY <br />o The need is real -the time is now <br />o Delay will be costly and risky <br />• Hefty penalties for non-compliance (Marin, San Carlos) <br />• Safety risks <br />• Unplanned, expensive emergency repairs <br />• Could miss federal stimulus grants <br />• Construction costs and interest rates at historic lows <br />o Maintenance of this critical City utility is in the <br />best interest of current and future ratepayers <br />o An investment in future generations, growth,. and <br />economic competiveness <br />o Another 70 years of excellent customer se ' <br />-and environmental protection around <br />o Minimal rate increase fora ' <br />16 <br />