Explanation
1. BACKGROUND: The Department of Public Utilities submitted a letter of intent to apply for an Ohio Energy Loan through the State of Ohio Development Services Agency on May 15, 2017. The loan application required a certified energy audit to be submitted by June 1, 2017. The loan will provide $2,000,000 in partial funding for the City’s Street Light Modernization program which intends to replace the majority of its existing 52,853 streetlight fixtures with LED equivalents over several years. These upgrades would occur throughout the City’s arterial roadways, neighborhood streets, downtown central district, and bridge underpasses. To convert all the City’s current streetlights to LED it would cost approximately $40,000,000, potentially yielding $2 million in annual energy savings through a reduction of 28,344,902 kilowatt hours of energy usage. Based on funding availability, the City intends to pursue the conversion in several stages, over multiple years, with multiple contract awards. For the first phase of the conversion, it is anticipated that the City will contribute $1.5-$2.5 million in funds from the Division of Power, coupled with the loan proceeds, for a total contract award of approximately $3.5-$4.5 million. Additional future funding from the Ohio Energy loan program may provide additional resources for the City to use each year.
On July 24, 2017 the Ohio Development Services Agency sent the Department a term sheet outlining the terms and conditions of the loan. This was not a commitment by the State or the City. A final commitment is subject to City Council approval, payment of $20,000 in loan fees, Director signature of the term sheet, completion of due diligence by the State, and final approval of the loan documentation. The terms of the loan include a $2,000,000 loan at a fixed interest rate of 2.0%, over 15 years, with no penalty for early pay-off. The loan is required to be closed on December 31, 2017. The City’s required cost share ...
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