TOWNSHIP OF OCEAN SEWERAGE AUTHORITY REGULAR MEETING Oakhurst, NJ May

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1 TOWNSHIP OF OCEAN SEWERAGE AUTHORITY REGULAR MEETING Oakhurst, NJ May A meeting of the Township of Ocean Sewerage Authority was held on the above date at the Authority Administration Building, 224 Roosevelt Avenue, Oakhurst, New Jersey. Present: Others: Bernhardt, Galvin, Stubbs, Theodora, Villapiano Attorney Bonello, Executive Director Schmeling, Operations Manager Kwityn, Secretary Finn Chairman Galvin called the meeting to order. All recited The Pledge of Allegiance. Chairman Galvin announced that the Meeting was being held in conformance with the Open Public Meetings Act of 1975 and that adequate notice had been duly posted where required and mailed to the Asbury Park Press and The New Coaster in accordance with law. WORK SESSION Director s Report. Director Schmeling briefly updated the members on his written report. Attorney s Report. Attorney Bonello said that he has reviewed the Developer s Agreement with Toll Brothers for the Enclave at Ocean and it is okay with the exception of the provision for TOSA to take over the sewer system. This should be an option at the Authority s discretion. Therefore, the language will be changed to show that the Authority may in their discretion take over the lines. Consulting Engineers from Hazen and Sawyer provided a presentation outlining their findings and recommendations with regard to the repair, rehabilitation and/or replacement of the ocean outfall line that runs off the Borough of Deal beach into the ocean for the discharge of affluent. They provided a written report to the board members and utilized a Summary of Outfall Recommendations graph to illustrate their recommendations and the associated costs. They noted that additional inspection of some portions of the line must still be completed. In addition, consideration must be given as to whether or not TOSA would in the future be receiving flow from Asbury Park prior to finalizing the plan for the outfall work. Hazen and Sawyer estimate a cost of $5+ million for repair of the line up to $27.1 million for rehabilitation of some portions of the line with replacement of major portions of the ocean pipe. They recommend the $27.1 million plan, which would provide a dependable solution to the ocean outfall line rehabilitation for years to come. Mr. Villapiano asked if pressurizing the pipe would be a viable alternative to replacing it with new. The engineers said that this would require measuring the thickness of the pipe to determine how much pressure the pipe could withstand. Attorney Bonello advised that the Authority needs to know to what extent the work would be attributed to including flow from Asbury Park. There was discussion about the need for a bypass line before building the new outfall line as well as the best method for removing and disposing of the old line. The timeline for the work was discussed with consideration being given to causing the least disturbance to summer beach use. Mr. Bernhardt noted that consideration must be given to the various state and federal requirements so that we can move forward with the NJ DEP and the Army Corps of Engineers. Chairman Galvin suggested a conference call with attorney John Hall, our legal expert on regulatory matters, and the TOSA board members and staff prior to the next meeting.

2 May Engineer s Report. There were no representatives of the engineering firm present at the meeting since there was no necessity for updates and/or questions at this time. Director Schmeling provided a review of the resolutions on the agenda. BUSINESS SESSION Mr. Stubbs offered a motion, seconded by Mr. Theodora and unanimously carried to approve the minutes of the following meeting: Regular Meeting April A copy of the Operations Manager Report for the month of April was received, a copy of which follows. Operations Manager Report For April 2017 DMR Results for 3/1/17 thru 3/31/17 Flow: Daily mgd Max mgd Eff. TSS 11 mg/l Removal 94% Eff. CBOD 6 mg/l Removal 96% Rain for the month 9.91 inches and Snow 2.75 inches Plant: 3/31-4/2/17 Heavy rains during this period, 3.10 inches. Had to run around the clock from 3/31 6 pm to 4/2 3:30 pm. Flows high a lot high-level alarms and ran 2 influent pumps at about 90%. Pump automatic bleed offs did not work properly. Brought in Pumping Services to give a price to fix. Also, asked Bruce to investigate control panel issues for main pumps. Seems a lot of programing needs to be looked at. He spoke to Sigma. 4/14/17 Clarifier 2 drive went down. Drive gears and chain need to be replaced, awaiting parts. 4/17/17 Met with EMI and Rich Bernhardt about several electrical issues. Wires are burning up in the ground. Plan was to get UNOX wires done a.s.a.p., started 4/26/17. CME to come in 4/26/17 to look at the rest of issues and put a plan together. 4/17/17 New VFD installed for Return Activated Sludge Pump 2, by EMI, Kanan Square D and ITS Controls. 4/20/17 DEP came in to do Annual compliance tests. Pump Stations: 3/31/17 thru 4/6/17 Interlaken Pump Station ran 3 pumps during the height of the storm and for next 5 days ran 2 pumps until lines were emptied. Wickapecko Pump station ran several days due to the storm. All pump stations were checked throughout the month, serviced and generators tested. Lateral Repairs: 106 Runyan Ave lateral replaced by Woszczak Evergreen Ave. lateral replaced by Woszczak. Sinkhole at 675 Roseld Ave. Lateral and hole fixed by Woszczak. 512 Myrtle Ave is scheduled to be repaired by Woszczak. CCTV Jobs: Oak and Walnut roots in the line, cleaned out with the jet truck Darlene Ave found water line thru sewer main. Doris Ave found telephone line thru sewer line and covered manholes for Lucas. Parker for buried manholes for Lucas. Chestnut and Spruce no major issues. 512 Myrtle Ave found what to be a piece of curb through the line. Scheduled to be repaired. Logan Rd. between Grassmere and Raymere, to check the laterals. Vacuum and Jet work: Washed down Pump Stations after the storm. Logan Rd to Park Blvd from Fairmont Ave. Red Lobster Main Rt. 35, heavy grease.

3 May Oak and Walnut for CCTV inspections. Oths main clogged assisted Board of Education to clear. Birch for CCTV inspection. Vacuumed Wickapecko, Green Grove, Rolling Meadows and Colonial Terrace Pump Stations. Maple Ave. Primary Tubes at the plant. Romaine and Evergreen for CCTV Inspections Manhole Deal Lake Point Dr. was cleaned for Lucas. Notes: Worked closely with CME and Lucas on Collection System Project I separated the Collection System into 2 groups lines and pump stations. Maintenance Dept. will take care of the daily pump station work now. With the others spending more time in the system. Sal Lagrotteria will go out on the Jet truck at least 3 days a week to explain details to Bob Ruland how piping in the street works and what to look for. Mr. Bernhardt made a motion to approve the Operator s Report. The motion was seconded by Mr. Stubbs and unanimously carried. Mr. Stubbs offered the following resolution and moved its adoption. Mr. Theodora seconded the motion. RESOLUTION BILL LIST BE IT RESOLVED by the Township of Ocean Sewerage Authority, in the County of Monmouth, New Jersey (not less than three (3) members affirmatively concurring) as follows: 1. All bills or claims as reviewed and approved by the Executive Director and as set forth in this are hereby approved for payment. 2. The authorized signers of checks are hereby authorized and directed to sign checks in the payment of bills and claims, which are hereby approved. The computer printout of the list of bills will be on file in the Purchasing Agent s Office. CURRENT FUND $ 458, REVIEW and INSPECTION EIT and CONSTRUCTION 334, PAYROLL ACCOUNT 0.00 TOTAL BILLS PAYABLE $ 793, Mr. Villapiano offered the following resolution and moved its adoption. Mr. Theodora seconded the motion AUTHORIZING APPROVAL OF DEVELOPER S AGREEMENT WITH TOLL NJ 1, LLC FOR ENCLAVE AT OCEAN - APPLICATION NUMBER 181

4 May WHEREAS, preliminary, tentative and final applications were submitted for Enclave at Ocean on or about July 9, 2015; and WHEREAS, the Authority granted preliminary and tentative approval for Enclave at Ocean on May 3, 2016; and WHEREAS, the Authority granted final approval for Enclave at Ocean on September 6, 2016; and WHEREAS, a condition of the grant of final approval was the execution of a Developer s Agreement covering the sanitary sewer collection system serving Enclave at Ocean; and WHEREAS, the parties have agreed to the terms and conditions of a Developer s Agreement in the form attached hereto. NOW, THEREFORE, BE IT RESOLVED by the Township of Ocean Sewerage Authority that the Chairman and Secretary are hereby authorized to sign the attached Developer s Agreement for Enclave at Ocean, LLC. The members decided to table Mr. Bernhardt offered the following resolution and moved its adoption. Theodora seconded the motion. Mr AUTHORIZING PAYMENT OF $300, TO LUCAS CONSTRUCTION GROUP, INC. FOR 2013 COLLECTION SYSTEM UPGRADES PROJECT WHEREAS, the Authority awarded a contract for its 2013 Collection System Upgrades project to Lucas Construction Group, Inc. in the amount of $4,575, (the Project ) on December 6, 2016; and WHEREAS, the Lucas has performed work and provided equipment and material for the Project; and WHEREAS, by letter dated April 21, 2017, the Authority s engineer has recommended payment in the amount of $300, pursuant to its Payment Estimate No. 1. THEREFORE, BE IT RESOLVED that the Township of Ocean Sewerage Authority hereby approves payment in the amount of $300, to Lucas Construction Group for the 2013 Collection System Upgrades Project in accordance with Payment Estimate No. 1. Mr. Bernhardt offered the following resolution and moved its adoption. Stubbs seconded the motion. Mr DETERMINING TO FINANCE SEWER IMPROVEMENT PROJECTS THROUGH THE NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST S FY2017 CAPITAL IMPROVEMENT PROGRAM, DETERMINING THE ESTIMATED

5 May COST THEREOF AND DETERMINING TO ISSUE BONDS AND NOTES TO FINANCE THE COST THEREOF WHEREAS, the Township of Ocean Sewerage Authority, in the County of Monmouth, New Jersey (the Authority ) has determined to finance three (3) sewer improvement projects consisting of: (1) Collection System Improvements to the Route 35 Sanitary Sewer Pipe and Wickapecko Pump Station (the Collection System Improvements ); (2) Collection System and Sewer Repair of Berkeley Avenue, Lakeside Avenue and Lincoln Avenue ( Berkeley, Lakeside and Lincoln Avenue Collection System Repairs ), and (3) Improvements to Asbury Avenue and Longview Pump Stations ( Asbury Avenue & Longview Pump Station Improvements, and together with the Collection System Improvements and the Berkeley, Lakeside and Lincoln Avenue Collection System Repairs, the Projects ) through the New Jersey Environmental Infrastructure Trust s FY2017 Capital Improvement Program; and WHEREAS, the Authority has determined to finance the Projects through the issuance of Bonds and no interest interim Notes through the Construction Financing Program, to the New Jersey Environmental Infrastructure Trust and the State of New Jersey in order to finance the Projects at the lowest possible cost to the Authority. NOW THEREFORE, BE IT RESOLVED by the Members of the Township of Ocean Sewerage Authority, as follows: Section 1. The Authority hereby determines to undertake the Projects as described above. The estimated cost of the Collection System Improvements is $4,600,000, the estimated cost of the Berkeley, Lakeside and Lincoln Avenue Collection System Repairs is $900,000 and the estimated cost of the Asbury Avenue & Longview Pump Station Improvements is $500,000. The Authority hereby determines to issue Bonds and temporary Notes in an amount not to exceed $6,000,000. Section 2. The Authority hereby determines that the Bonds and Notes for the Projects will be sold to the New Jersey Environmental Infrastructure Trust (the Trust ) and the State of New Jersey (the State ) in accordance with the procedures established for the sale of Bonds and Notes to the Trust and the State. The Bonds and Notes will be issued as subordinated indebtedness as permitted by the Authority s General Bond adopted June 14, 1985, as amended and supplemented. Section 3. In anticipation of the issuance of Bonds, the Authority may issue project notes/interim Notes to provide funds for the cost of the Projects. Section 4. The Chairman, Vice Chairman and Executive Director each are hereby authorized to award the Bonds or Interim Notes to the Trust and State on the terms and in the amounts as determined by each of them in accordance with the procedures referred to in Section 2. Section 5. A copy of this Bond shall be filed and published in accordance with the provisions of N.J.S.A. 40:14A-14. Section 6. This resolution shall take effect immediately. Mr. Theodora offered the following resolution and moved its adoption. Stubbs seconded the motion. Mr DECLARING OFFICIAL INTENT OF THE TOWNSHIP OF OCEAN SEWERAGE AUTHORITY TO REIMBURSE EXPENDITURES FOR PROJECT COSTS FROM THE PROCEEDS OF DEBT OBLIGATIONS IN CONNECTION

6 May WITH ITS PARTICIPATION IN THE FISCAL YEAR 2017 NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST FINANCING PROGRAM WHEREAS, the Township of Ocean Sewerage Authority (the "Borrower") intends to acquire, construct, renovate and/or install the environmental infrastructure projects more fully described in Exhibit A attached hereto (the "Projects"); WHEREAS, the Borrower intends to finance the Projects with debt obligations of the Borrower (the "Project Debt Obligations") but may pay for certain costs of the Projects (the "Project Costs") prior to the issuance of the Project Debt Obligations with funds of the Borrower that are not borrowed funds; WHEREAS, the Borrower reasonably anticipates that obligations, the interest on which is excluded from gross income under Section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), will be issued by the New Jersey Environmental Infrastructure Trust (the "Issuer") to finance the Project on a long-term basis by making a loan to the Borrower with the proceeds of the Issuer's obligations (the Notes and the "Bonds"); and WHEREAS, the Borrower desires to preserve its right to treat an allocation of proceeds of the Project Debt Obligations to the reimbursement of Project Costs paid prior to the issuance of the Project Debt Obligations as an expenditure for such Project Costs to be reimbursed for purposes of Sections 103 and 141 through 150, inclusive, of the Code. NOW, THEREFORE, BE IT RESOLVED by the governing body of the Borrower as follows: Section 1. The Borrower reasonably expects to reimburse its expenditure of Project Costs paid prior to the issuance of the Project Debt Obligations with proceeds of its Project Debt Obligations. Section 2. This resolution is intended to be and hereby is a declaration of the Borrower's official intent to reimburse the expenditure of Project Costs paid prior to the issuance of the Project Debt Obligations with the proceeds of a borrowing to be incurred by the Borrower, in accordance with Treasury Regulations Section 3. The maximum principal amount of the Project Debt Obligations expected to be issued to finance the Projects is $6,000,000. Section 4. The Project Costs to be reimbursed with the proceeds of the Project Debt Obligations will be "capital expenditures" in accordance with the meaning of Section 150 of the Code. Section 5. No reimbursement allocation will employ an "abusive arbitrage device" under Treasury Regulations to avoid the arbitrage restrictions or to avoid the restrictions under Sections 142 through 147, inclusive, of the Code. The proceeds of the Project Bonds used to reimburse the Borrower for Project Costs, or funds corresponding to such amounts, will not be used in a manner that results in the creation of "replacement proceeds", including "sinking funds", "pledged funds" or funds subject to a "negative pledge" (as such terms are defined in Treasury Regulations ), of the Project Debt Obligations or another issue of debt obligations of the Borrower, other than amounts deposited into a "bona fide debt service fund" (as defined in Treasury Regulations ). Section 6. All reimbursement allocations will occur not later than 18 months after the later of (i) the date the expenditure from a source other than the Project Debt Obligations is paid, or (ii) the date the Project is "placed in service" (within the meaning of Treasury Regulations ) or abandoned, but in no event more than 3 years after the expenditure is paid. Section 7. This resolution shall take effect immediately.

7 May Mr. Villapiano offered the following resolution and moved its adoption. Mr. Theodora seconded the motion DETERMINING THE FORM AND OTHER DETAILS OF TOWNSHIP OF OCEAN SEWERAGE AUTHORITY NOTES RELATING TO THE CONSTRUCTION FINANCING PROGRAM OF THE NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST, TO BE ISSUED IN THE PRINCIPAL AMOUNT OF UP TO $6,000,000, AND PROVIDING FOR THE ISSUANCE AND SALE OF SUCH NOTES TO THE NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST, AND AUTHORIZING THE EXECUTION AND DELIVERY OF SUCH NOTES BY THE TOWNSHIP OF OCEAN SEWERAGE AUTHORITY IN FAVOR OF THE NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST, ALL PURSUANT TO THE NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST CONSTRUCTION FINANCING PROGRAM. WHEREAS, the Township of Ocean Sewerage Authority in the County of Monmouth, New Jersey (the Local Unit ) has determined that there exists a need to finance three (3) sewer improvement projects consisting of: (1) Collection System Improvements to the Route 35 Sanitary Sewer Pipe, Wickapecko Pump Station and Interlaken Pump Station (the Collection System Improvements ); (2) Collection System and Sewer Repair of Berkeley Avenue, Lakeside Avenue and Lincoln Avenue ( Berkeley, Lakeside and Lincoln Avenue Collection System Repairs ), and (3) Improvements to Asbury Avenue and Longview Pump Stations ( Asbury Avenue & Longview Pump Station Improvements, and together with the Collection System Improvements and the Berkeley, Lakeside and Lincoln Avenue Collection System Repairs, the Projects ), and it is the desire of the Local Unit to obtain financing for such Projects through participation in the environmental infrastructure financing program (the Environmental Infrastructure Financing Program ) of the New Jersey Environmental Infrastructure Trust (the Trust ); WHEREAS, the Local Unit has determined to temporarily finance the construction, renovation and installation of the Projects prior to the closing with respect to the Environmental Infrastructure Financing Program, and to undertake such temporary financing with the proceeds of a short-term loan to be made by the Trust (the Construction Loan ) to the Local Unit, pursuant to the Construction Financing Program of the Trust (the Construction Financing Program ); WHEREAS, in order to (i) evidence and secure the repayment obligation of the Local Unit to the Trust with respect to the Construction Loan and (ii) satisfy the requirements of the Construction Financing Program, it is the desire of the Local Unit to issue and sell to the Trust the Notes Relating to the Construction Financing Program of the New Jersey Environmental Infrastructure Trust in an aggregate principal amount of up to $6,000,000 (the Notes ); WHEREAS, it is the desire of the Local Unit to authorize, execute, attest and deliver the Notes to the Trust pursuant to the terms of (i) the Sewerage Authorities Law, constituting Chapter 138 of the Pamphlet Laws of 1946 of the State of New Jersey (codified at N.J.S.A. 40:14A-1 et seq.), as the same may from time to time be amended and supplemented (the Local Unit Enabling Act ) and the Local Authorities Fiscal Control Law, constituting Chapter 313 of the Pamphlet Laws of 1983 of the State of New Jersey (codified at N.J.S.A. 40A:5A-1 et seq.), as the same may from time to time be amended and supplemented (the Local Authorities Fiscal Control Law ); and WHEREAS, Section 12 of the Local Authorities Fiscal Control Law and N.J.S.A. 58:11B-9 each allow for the sale of the Notes to the Trust, without any public offering, all pursuant to the terms and conditions set forth therein.

8 May NOW, THEREFORE, BE IT RESOLVED by the governing body of the Local Unit as follows: Section 1. In accordance with Section 12 of the Local Authorities Fiscal Control Law and N.J.S.A. 58:11B-9, the Local Unit hereby authorizes the issuance, sale and award of the Notes in accordance with the provisions hereof. The obligation represented by the Notes have been authorized by the resolution of the Local Unit, which resolution is entitled RESOLUTION OF THE TOWNSHIP OF OCEAN SEWERAGE AUTHORITY, IN THE COUNTY OF MONMOUTH, NEW JERSEY DETERMINING TO FINANCE SEWER IMPROVEMENT PROJECTS THROUGH THE NEW JERSEY ENVIRONMENTAL INFRASTRUCTURE TRUST S FY2017 CAPITAL IMPROVEMENT PROGRAM, DETERMINING THE ESTIMATED COST THEREOF AND DETERMINING TO ISSUE BONDS AND NOTES TO FINANCE THE COST (the Local Unit Note ) and was finally adopted by the Local Unit at a meeting duly called and held on May 9, 2017, at which time a quorum was present and acted throughout, all pursuant to the terms of the Local Unit Enabling Act, the Local Authorities Fiscal Control Law and other applicable law. Section 2. The Executive Director of the Local Unit (the Executive Director ) is hereby authorized to determine pursuant to the terms and conditions hereof and of the Local Unit Note (i) the final principal amount of the Note (subject to the maximum limitation set forth in Section 4(a) hereof), and (ii) the dated date of the Note. Section 3. Any determination made by the Executive Director pursuant to the terms hereof shall be conclusively evidenced by the execution and attestation of the Note by the parties authorized pursuant to Section 4(h) hereof. Section 4. shall be as follows: The Local Unit hereby determines that certain terms of the Note (a) the principal amount of the Notes to be issued shall be an amount up to $6,000,000, which shall be issued in three (3) separate Notes for each of the Projects ; (b) the maturity of the Notes shall be as determined by the Trust; (c) the interest rate of the Notes shall be as determined by the Trust; (d) the purchase price for the Notes shall be par; (e) the Notes shall be subject to prepayment prior to its stated maturity in accordance with the terms and conditions of the Note; (f) each of the Notes shall be issued in a single denomination and shall be numbered CFP-17- ; (g) the Notes shall be issued in fully registered form and shall be payable to the registered owner thereof as to both principal and interest in lawful money of the United States of America; and (h) the Notes shall be executed by the manual or facsimile signatures of the Chairman or Vice Chairman under official seal or facsimile thereof affixed, printed, engraved or reproduced thereon and attested by the manual signature of the Secretary of the Local Unit (the Secretary ). Section 5. Exhibit A. The Notes shall be substantially in the form attached hereto as Section 6. The law firm of Davison Eastman Muñoz Lederman & Paone, P.A. is hereby authorized to arrange for the printing of the Notes, which law firm may authorize McCarter & English, LLP, bond counsel to the Trust for the Construction Financing Program, to arrange for same. Section 7. The Executive Director of the Local Unit is hereby further authorized to (i) execute and deliver, and the Secretary is hereby further authorized to attest to such execution and to affix the corporate seal of the Local Unit to, any document, instrument or closing certificate deemed necessary, desirable or convenient by the Executive Director or the Secretary, as applicable, in their respective sole discretion, after consultation with counsel and any advisors to the Local Unit and after further consultation

9 May with the Trust and its representatives, agents, counsel and advisors, to be executed in connection with the issuance and sale of the Notes and the participation of the Local Unit in the Construction Financing Program, which determination shall be conclusively evidenced by the execution of each such certificate or other document by the party authorized hereunder to execute such certificate or other document, and (ii) perform such other actions as the Executive Director and the Secretary deem necessary, desirable or convenient in relation to the execution and delivery of the Notes and the participation of the Local Unit in the Construction Financing Program. Section 8. This resolution shall take effect immediately. Section 9. Upon the adoption hereof, the Secretary shall forward certified copies of this resolution to Kerry J. Morgan, Davison Eastman Muñoz Lederman & Paone, P.A., bond counsel to the Local Unit, David Zimmer, Executive Director of the Trust, and Richard T. Nolan, Esq., McCarter & English, LLP, bond counsel to the Trust. The members determined that it was necessary to go into closed session. Mr. Theodora offered the following and moved its adoption. Mr. Stubbs seconded the motion. RESOLUTION DECLARING CLOSED SESSION WHEREAS, Section 8 of the Open Public Meetings Act, Chapter 231, P.L. 1975, permits the exclusion of the public from a meeting in certain circumstances, and exist. WHEREAS, this public body is of the opinion that such circumstances presently NOW, THEREFORE, BE IT RESOLVED by the Township of Ocean Sewerage Authority as follows: 1. The Public shall be excluded from discussion of and action upon the hereinafterspecified subject matters. 2. The general nature of the subject matter to be discussed is as follows: Personnel 3. It is anticipated at this time that the above stated subject matters would be made public when matters are resolved. This resolution shall take effect immediately. Roll Call: Bernhardt, Galvin, Stubbs, Theodora, Villapiano No action was taken after the Closed Session, and there being no further business to come before the Authority, Mr. Theodora moved that the meeting be adjourned. Mr. Villapiano seconded the motion and all voted in favor of adjournment. Respectfully submitted, RALPH E. STUBBS, Secretary