55B - DIAMOND APKR MUTAL WATER CO

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Jxs (04/05/10) RESOLUTION NO. 2010- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA TO ACCEPT STATE GRANT FUNDING, CONSTRUCT PUBLIC WATER SYSTEM IMPROVEMENTS AND PROVIDE SERVICE TO FORMER CUSTOMERS OF DIAMOND PARK MUTUAL WATER COMPANY BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1. The City Council of the City of Santa Ana finds, determines and declares as follows: A. The Diamond Park Mutual Water Company ( DPMWC) is a privately owned mutual water company that provides domestic water service to approximately 90 residences in the City of Santa Ana. B. The well serving DPMWC is contaminated with nitrates and does not meet Title 22 drinking water standards. The water system infrastructure (pipelines, well, and tank) is obsolete and fails frequently, resulting in water outages to DPMWC customers. C. The Board of Directors of DPMWC has by resolution declared intent to cease operations and direct their customers to connect to the City's water system. D. The cost to construct the public water system improvements required to serve DPMWC is estimated at approximately $1,000,000. E. The State of California Department of Public Health has filed an application on behalf of DPMWC for a State Revolving Fund grant that will cover 80% of the construction costs. Section 2. Should DPMWC be awarded the State Funds, the City of Santa Ana agrees to accept the State Revolving Fund grant and use the grant funds to cover 80% of the construction costs of public water system improvements. Section 3. Should DPMWC be awarded the State Funds, the City of Santa Ana agrees to accept and repay a State Revolving Fund loan in an amount that will cover the remaining 20% of the construction costs of public water system improvements. Costs to offset this loan will be recovered through connection fees collected from DPMWC customers. Resolution No. 2010 -XXX Page 1 of 3 l : J