Sarpy County wastewater agency reports smaller WIFIA draw, seeks loan modification and Gretna service agreement changes

Dan Hoynes, administrator for the Sarpy County and Cities Wastewater Agency, told the Sarpy County Board of Commissioners on Sept. 16 that the agency has completed the documentation WIFIA requested for a loan modification and expects the federal loan program to accept a scope change that would add specific decommissioning and design costs.

“The good news is WIFIA has accepted all of the documentation that they'd requested from us to do the scope change,” Hoynes said. He named three specific inclusions: the Springfield decommissioning cost, the SARPE decommissioning cost, and use of WIFIA funds “for design and permitting for phase 1B and 2.”

Hoynes said the agency’s latest projection reduces the expected draw on a previously authorized $45 million WIFIA loan to about $33 million. He said that smaller draw would lower the agency’s State Revolving Fund (SRF) reserve requirement by roughly $1.5 million compared with the full $45 million draw.

“At the end of the day, that would require a reserve backing of $10,700,000 on the $45 million draw. If we close the loan out at $33 [million], it’s about $9,100,000 of reserve backing,” Hoynes said. He also described the loan’s effect on debt-service coverage: at the higher draw the coverage ratio would have been about 1.1 at a future pinch point year, while the $33 million scenario raises that ratio to about 3.3, “so it more than almost triples the room that we have,” he said.

Hoynes outlined the approval steps ahead: WIFIA will issue modified loan documents, the agency will review and submit them jointly with county staff, the modification will be routed to the agency board and the Sarpy County Board for approval, and WIFIA will execute the modification.

The agency also described a negotiated amendment to the Gretna service agreement, which Hoynes said preserves agency control of certain revenues while giving member jurisdictions autonomy to advance local sewer lines. Hoynes said the amendment keeps “100% of the connection fees” with the agency and that a portion of user-rate revenues would be remitted to the agency; he characterized the arrangement as a framework that other agency members could use if they advance lines in their jurisdictions.

Hoynes presented a fiscal-impact summary for Gretna’s buildout and the agency’s 10‑year projection. He said connection-fee revenue for the agency’s most recent fiscal year was about $3.4 million and that the agency’s total loan balances were about $90.7 million as of June 30, including a partial draw of the $45 million WIFIA loan. Hoynes identified continuing priorities as finalizing the WIFIA modification, completing design and permitting for phases 1B and 2, and updating the agency’s growth-management plan (a sewer “comprehensive plan”).

Commissioners asked for an updated coverage/reserve projection; Hoynes said he would provide a revised graph to County Administrator Bonnie Moore.

Clarifying details recorded in the meeting include Hoynes’s estimates that the agency’s projected WIFIA draw is about $33,000,000 (versus the previously authorized $45,000,000), an SRF reserve obligation of about $9,100,000 under the $33 million draw (versus $10,700,000 under $45 million), and a cited debt-service coverage ratio of about 1.1 at the larger draw versus about 3.3 at the $33 million draw. Hoynes also said the agency’s connection-fee revenue for the fiscal year was roughly $3,400,000 and reported total loan balances near $90,700,000 as of June 30.

Speakers at the presentation included Hoynes and agency staff; county commissioners asked questions during the briefing. Hoynes said the agency CFO and consultants are available to answer technical questions and that he will route updated materials to staff for the county board’s review.

The county board took no formal vote on the update; Hoynes’s presentation was informational and flagged multiple items that will return for formal approval when the agency and county review the WIFIA modification.