NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
David Zimmer
Executive Director _______________________________________________________________
NJ Environmental Infrastructure Trust
Welcome
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
The New Jersey Environmental Infrastructure Trust is the independent
State Financing Authority responsible for providing and administering low cost interest
-rate loans to qualified municipalities, counties, regional authorities and water purveyors for
the purposed of financing water quality related infrastructure projects.
NJEIT Mission Statement
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Environmental Infrastructure Financing Program – NJ EIFP
Equal Partnership
NJ DEP NJ EIT
Local Borrowers
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Contractor
Borrower (Municipality,
Authority, etc.)
Debt Service Repayment
$
Trust Loan $
Bond Trustee (MPTA)
Bond Investors
NJEIT
DEP
Federal/State
Fund Loan $
Bond Proceeds
SRF / Bond $$
Backed by GO’s, SA’s, etc.
Fund Loan Debt Service (0.51 yrs.
in arrears)
Trust Loan Debt Service
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
SFY-2013 Rate Structure / Allocation
GENERAL LOAN PROGRAM 75% - Fund Loan (0% rate DEP loan) + 25% - Trust Loan (AAA Market-rate loan)
PRINCIPAL FORGIVENESS PROGRAM: up to $20MM Green projects (expanded) in
Barnegat Bay Watershed
25% - Principal Forgiveness (max. of $2MM, no principal repayment due upon completion) + 50% - Fund Loan (0% rate DEP loan) + 25% - Trust Loan (AAA Market-rate loan)
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Below Market Rate = Blend of 0% DEP “Fund” Loan and AAA Market “Trust” Loan
20 yr. savings on $1mm Borrowed:
~ $120,000 / each 1% saved
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
How the NJEIFP Advances the State Strategic Plan
Goal 1: Targeted Economic Growth • Projects Funded
• Project Ranking Methodology
Goal 4: Tactical Alignment of Government • Low interest financing to leverage limited local government dollars, and in some cases, options
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Goal 1: Targeted Economic Growth
• Projects Funded - Wastewater Project Loans
- Drinking Water Project Loan
- Stormwater Management
• Project Ranking Incentives in Growth Areas - Prioritization: CSOs, Brownfields Reserve
- Ranking Points:
- Urban and Regional Centers
- Designated Towns
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
The EIFP Funds Infrastructure in Priority Growth Areas
• Challenge: Fund projects that upgrade existing infrastructure where needed (Vibrant Regions) versus Adding new capacity
• Fund Redevelopment projects that strengthen existing cities, towns and neighborhoods through remediation of existing sites
• Provide opportunities for private capital investing by transferring risk away from public funds to private equity
• Facilitate construction of critical investment grade projects for additional private equity in which to invest
• Continue to maximize the leveraging of public monies
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Limited Municipal Financing Resources Significant Savings Relative to Independent Financing
• Interest Rates 25% - 50% market rates • Trust Excellent Credit Rating • No debt service reserve fund or bond insurance required • Capitalized interest allows deferring of financing costs • NJEIFP Loan Administration • NJEIFP manages arbitrage issues • NJEIT tracks and manages refunding opportunities
Tactical Alignment of Government
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Importance of Strategic Investment in NJ’s Physical Infrastructure
The NJEIFP has been critical in financing infrastructure, supporting key industry clusters throughout New Jersey
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Necessity for Coordinated Planning
Estimated 20-Year State Infrastructure Needs
1. Water Supply $ 8.0 B 2. Clean Water
a. Wastewater Disposal $17.0 B b. Stormwater Mgmt $16.0 B c. Nonpoint Source Control $ 2.0 B
Total $ 43.0 B
* New Jersey Clean Watersheds Needs Survey 2008
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
20-Year Estimated Infrastructure Needs
Drinking Water
1. Water Supply: $8.0 B *
1. Transmission/Distribution $4.7 B
2. Source Development and Rehabilitation $0.31 B
3. Treatment $1.9 B
4. Storage $1.1 B
* New Jersey Clean Watersheds Needs Survey 2008
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Clean Water
2a. Wastewater Disposal: $ 17.0 B *
1. Wastewater Treatment $ 6.3 B
2. Pipe repair & new pipes $ 2.3 B
3. Recycled water distribution $ 0.10 B
4. Combined sewer overflow correction $ 8.2 B
* New Jersey Clean Watersheds Needs Survey 2008
20-Year Estimated Infrastructure Needs
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Clean Water
2b. Stormwater Management: $ 16.0 B *
1. Conveyance infrastructure $ 0.49 B
2. Treatment systems $ 0.11
B
3. Green infrastructure $ 14.9 B
4. General stormwater management $ 0.11 B
* New Jersey Clean Watersheds Needs Survey 2008
20-Year Estimated Infrastructure Needs
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
Clean Water
2c. Nonpoint Source Control: $ 2.0 B *
1. Agriculture best management practices $ 0.08 B
2. Ground water protection $ 0.55 B
3. Brownfields remediation $ 0.83 B
4. Storage tank remediation $ 0.003 B
5. Sanitary Landfills BMPs $ 0.276 B
6. Hydromodification $ 0.004 B
* New Jersey Clean Watersheds Needs Survey 2008
20-Year Estimated Infrastructure Needs
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
• Investment in the infrastructure (assets) and O&M (labor/supplies) of water & sewer facilities expands the productive capacity of the economy and creates value-added:
• ROI Analysis - Every $1.00 of water & sewer infrastructure investment increases private output (long-term) by $6.35 *
• Each additional $1.00 of water & sewer revenue spent on O&M increases revenue in all industries by $2.62 that year *
• Each additional job in water & sewer creates 3.68 jobs in the national economy to support that job *
• ROI from water & sewer infrastructure exceeds that of highways *
• Promotion of much needed job growth through facilitation of investment in Priority Growth Investment Areas
* Source: U.S. Conference of Mayors, Local Government Investment in Municipal Water and Sewer Infrastructure, 8-14-2008.
Benefits of Strategic Investment in NJ’s Physical Infrastructure
NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST
David Zimmer Executive Director, NJEIT
Geoffrey Stewart Financial Advisor, Public Financial Management
Richard Nolan Bond Counsel, McCarter & English
Karla Martin DEP – Office of Equal Opportunity and
Lydia Harper Public Contract Assistance
Gene Chebra Acting Assistant Director,
DEP – Office of Municipal Finance
Terry Caruso DEP Green Acres,
Contact List