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art.006/3/006/2/016/1

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ARTICLE 6

RELATING TO DEBT MANAGEMENT ACT JOINT RESOLUTION

SECTION 1. This article consists of joint resolutions that is submitted pursuant to Rhode

Island General Law § 35-18-1, et seq.

SECTION 2. Confined Aquatic Dredged Material Disposal Cells.

WHEREAS, over the past year the Army Corps of Engineers has approached the Ccoastal

Rresources Mmanagement Ccouncil to act as the local sponsor to the federal action of maintaining

the depths of the Providence River and Harbor Shipping Channel; and

WHEREAS, the Providence River and Shipping Channel was last maintained in 2003; and

WHEREAS, the project will include dredging and removal of sediments not suitable for

ocean disposal, and thus will require the construction of a new Confined Aquatic Disposal (CAD)

Cell to dispose and sequester those sediments; and

WHEREAS, CAD cells are constructed in aquatic environments to reduce the

environmental risk from sediments not suitable for ocean disposal by storing these sediments in a

depression in the bottom of the aquatic system; and

WHEREAS, CAD cells offer a major economic value, as a significant cost of disposing

dredged materials is in the transportation of the dredged material to a disposal location; and

WHEREAS, having CAD cells located within hundreds of feet from a dredging operation

saves local port operators millions of dollars over the 10 ten-year (10) life of those cells; and

WHERAS, the Ccoastal Rresources Mmanagement Ccouncil seeks to build additional

capacity in the CAD Cells beyond that required only for this specific project, in order to account

for the many port, maritime, and marina facilities that also have the need to dredge material at their

facilities, which may not be suitable for ocean disposal, thereby saving these entities significant

cost, in both sediment testing and transportation of the material to other locations, due to the fact

that the existing CAD cells in the river have reached their useful ten-year design life; and

WHEREAS, with the approval by the voters of the 2016 Rhode Island Port Infrastructure

Bond referendum, the need to maintain the viability of port and maritime operations, the state's

marine trades industry, and the increase economic value of ProvPort, increased disposal capacities

from new CAD cells are needed; and

WHEREAS, the Army Corps of Engineers expects to begin maintenance of the Providence

River and Harbor Shipping Channel in the fall of 2018, the total cost share of the local sponsor are

required by the end of FY 2018; and

WHEREAS, the project is considered a federal maintenance project, the Sstate is required

to pay for the creation of the CAD cell only at an up-front cost share of thirty five percent (35%);

and

WHEREAS, the project costs associated with this project is estimated to be eleven million

dollars ($11.0 million), with five hundred thousand dollars ($500,000) derived from the Ccoastal

Rresources Mmanagement Ccouncil Ddredge Ffund. The total financing obligation of the Sstate

of Rhode Island would be approximately ten million five hundred thousand dollars ($10.5 million),

with ten million four hundred thousand dollars ($10.4 million) deposited in the project fund and

one hundred thousand dollars ($100,000) allocated to pay the associated costs of financing. Total

payments on the Sstate's obligation over ten (10) years on the ten million five hundred thousand

dollars ($10.5 million) issuance are projected to be thirteen million six hundred thousand dollars

($13.6 million) assuming an average interest rate of five percent (5.0%). A minimum of five million

dollars ($5.0 million) of the total principal and interest payments shall be financed from an increase

in fees charged to marine operators to deposit their dredged materials into CAD cells, with general

revenue appropriations used to supplement fee revenues. General revenue appropriations shall

finance principal and interest payments in any fiscal year that fee revenues are insufficient; now,

therefore, be it

RESOLVED, that this Ggeneral Aassembly hereby approves financing in an amount not

to exceed ten million five hundred thousand dollars ($10.5 million) for the provision of funds for

the Confined Aquatic Disposal Cells project, including one hundred thousand dollars ($100,000)

to pay costs of financing.

SECTION 3. Energy Performance Contract – University of Rhode Island – Phase 3

WHEREAS, the Ccouncil on Ppostsecondary Eeducation and the Uuniversity of Rhode

Island, herby referred to as "the Uuniversity," are proposing projects that involve the

implementation of professionally guided capital investments in energy efficiency improvements to

Uuniversity buildings and infrastructure that will pay for themselves through cost avoidance, while

reducing long-term energy consumption associated with operations; and

WHEREAS, the Uuniversity presently manages over three hundred twenty four (324)

buildings, with associated utility infrastructure, containing over four million eight hundred fifty

thousand (4,850,000) square feet of space, a majority of which was constructed over thirty years

ago. Energy efficiency has become a vital feature of the institution's fiscal responsibility; and

WHEREAS, energy performance contracting has been significantly enhanced and refined,

and many examples exist of programs successfully employed around the country that are prudent

from both a fiscal management and an environmental stewardship perspective; and

WHEREAS, various private sector companies, hereinafter referred to as energy service

companies or "ESCOs", are willing to guarantee the performance of the improvements yielding

energy savings to pay for the cost of the replacement of antiquated and inefficient equipment,

including boilers, heating and air conditioning, lighting and other building systems and equipment;

and

WHEREAS, the higher education system has successfully participated with the state

department of administration in a request for proposal process to enter into an energy performance

contract with ESCO to provide investment grade energy audit evaluations, design, installation, and

maintenance services, as well as assistance in securing rebate resources and the guarantee of the

energy or water saving performance of the installed retrofit measures; and

WHEREAS, the evaluations of an energy service company further affirms the significant

opportunity to implement energy conservation improvements on a building-by-building basis that

pay for themselves through operating budget savings within a fifteen-year (15) period; and

WHEREAS, tax exempt financing via "certificates of participation," with associated debt

service supported for the financing term by energy cost avoidance (i.e., by redirecting dollars that

would have paid for utility consumption, but with the improvements can be redeployed to repay

the financing) is the most cost effective means of supporting the investment in energy efficiency

improvements under this program; and

WHEREAS, the Uuniversity is seeking to undertake energy performance contracts to

replace obsolete equipment with new equipment and infrastructure components employing high

energy efficient technologies, to employ insulation and weatherization measures, and to deploy

measures that sustain the highest performance levels for these improvements; and

WHEREAS, the estimated cost of such contracts are for the Uuniversity, an amount not to

exceed eleven million six hundred thousand dollars ($11.6 million), with the request to the state to

have with ten million five hundred thousand dollars ($10.5 million) deposited into the construction

fund, six hundred ninety-six thousand dollars ($696,000) deposited in a capitalized interest fund,

and four hundred thirty thousand dollars ($430,000) to pay associated costs of financing. Total

payments on the state's obligation over fifteen (15) years on the eleven million six hundred thousand

dollars ($11.6 million) issuance are projected to be sixteen million eight hundred thousand dollars

($16.8 million), assuming an average effective interest rate of five percent (5.0%), the payments

would be derived by the Uuniversity from energy savings; now, therefore, be it

RESOLVED, that the Uuniversity is authorized to proceed with the aforementioned

projects in the amounts specified above; and be it further

RESOLVED, that these contracts will be structured so that, at a minimum, the annual

principal, interest and service and maintenance costs resulting from these contracts would be fully

offset by the cumulative annual energy savings derived from energy efficiency improvements, the

performance of which being guaranteed by the ESCOs; and be it further

RESOLVED, that these contracts would be multi-year contracts of up to a term of fifteen

(15) years. In addition to saving energy and helping to protect the Uuniversity from future energy

cost increases, these contracts would aid in reducing maintenance costs by providing new, efficient

equipment and technology that outperforms older higher energy consuming systems; and be it

further

RESOLVED, that this joint resolution shall take effect immediately upon its passage.

SECTION 4. White Horn Brook Apartments – University of Rhode Island.

WHEREAS, the Rhode Island Ccouncil on Ppostsecondary Eeducation is proposing a

project which that involves the construction of a new residence hall on the west bank of the White

Horn Brook located in the northwest corner of the Kingston campus of the Uuniversity of Rhode

Island in the Ttown of South Kingstown, Rhode Island; and

WHEREAS, the growth of undergraduate student enrollment is critical to the fiscal health

of the Uuniversity; and

WHEREAS, there is high undergraduate student demand for apartment-style, on-campus

housing; and

WHEREAS, the Uuniversity is committed to providing adequate and appropriate housing

opportunities for its students; and

WHEREAS, the Uuniversity continues to undertake significant improvements to existing

dormitory-style housing facilities and has built new units that offer both suite style and apartment

living options with the goal of providing over fifty percent (50%) of its undergraduate students on

campus housing in keeping with its peer institutions; and

WHEREAS, apartment-style housing units are critical for the on-campus retention of third-

and fourth-year students that often seek alternative housing off campus; and

WHEREAS, a recent market study has demonstrated that the market demand for additional,

apartment-style campus housing indicates that this project will be fully occupied upon completion

and into the future; and

WHEREAS, the Rhode Island Public Corporation Debt Management Act requires the

Ggeneral Aassembly to provide its consent to the issuance or incurring by the Sstate of Rhode

Island and other public agencies of certain obligations including financing guarantees or other

agreements; and

WHEREAS, the design and construction of the project will be financed through Rhode

Island Health and Educational Building (RIHEBC) revenue bonds, with an expected term of thirty

(30) years; and

WHEREAS, the total project costs associated with the completion of the project and

proposed financing method would be supported approximately ninety-five percent (95%) by

auxiliary fee revenues for URI Hhousing and Rresidential Llife for the apartment building and

approximately five percent (5%) by Uuniversity general funds for site enabling facility relocation,

utility and hardscape and landscape infrastructure and site work; and

WHEREAS, the project is currently in design and targeting a total project financing cost

of eighty eight million seven hundred and eighty seven thousand dollars ($88,787,000) in RIHEBC

bonds, with a request to have seventy eight million four hundred forty thousand dollars

($78,440,000) deposited into a construction fund, eight million thirty seven thousand dollars

($8,037,000) deposited in a capitalized interest fund, and two million three hundred ten thousand

dollars ($2,310,000) to pay associated cost of financing, and with an assumed interest rate of five

percent (5%) debt service repayments will not exceed one hundred seventy three million two

hundred seventy one thousand and six hundred fifty three dollars ($173,271,653); and

WHEREAS, the Uuniversity has been advised by its architectural and project management

firms to anticipate potential additional escalation of construction costs leading up to the final

pricing of the construction of this project; now, therefore, be it

RESOLVED, that the Ggeneral Aassembly hereby approves financing in an amount not to

exceed total debt service payments of one hundred seventy three million two hundred seventy one

thousand and six hundred fifty three dollars ($173,271,653) for construction of a new, apartment-

style residence facility on the Uuniversity of Rhode Island Kingston Ccampus, with the not-to-

exceed amount to be financed determined by the actual financing interest rate at the time of the

bond issuance; and be it further

RESOLVED, that this joint resolution shall take effect immediately upon its passage.

SECTION 5. This resolution shall apply to financing obligations issued within four (4)

years of the date of passage of this resolution.

SECTION 6. This article shall take effect upon passage.