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Proposed Term Loan Borrowing and Grant from the DWGTF
PEU is a New Hampshire public utility corporation providing retail water service to approximately
8,580 customers in the New Hampshire towns of Atkinson, Barnstead, Bow, Chester, Conway,
Derry, Exeter, Hooksett, Lee, Litchfield, Londonderry, Middleton, Pelham, Plaistow, Raymond,
Sandown, Tilton, Weare and Windham. PEU is wholly-owned by Pennichuck which, in turn, is
wholly-owned by the City.
PEU requests the City’s approval for PEU to enter into a term loan with the DWGTF in an
amount of up to $493,500 with an amortization period of up to 25 years, with an interest rate of
1.57% per annum, and to accept a grant from the DWGTF for $211,500. A copy of the approval
and granting of such financing and funding from the DWGTF, thru the NHDES is attached as
Attachment A.
The proceeds from the DWGTF loan/grant will be used for a single project in the W&E
Community Water System (“CWS”) in Windham, NH. This project includes the installation and
construction of an interconnection water main between that CWS and the Salem Municipal water
system, as well as treatment upgrades in the pump station for the CWS in order to accept and treat
the water obtained via that new interconnection. This project is being completed to fully meet
and comply with necessary water source and supply needs for the CWS.
The DWGTF loan will be unsecured, and the grant monies will be accepted as a CIAC
contribution to the Company for this project.
Approval by Pennichuck and PEU. The acceptance of this grant money and the entering into
of this loan, have been approved by the Board of Directors of Pennichuck and PEU. Pennichuck
recommends that the City authorize PEU and Pennichuck to (i) enter into the loan with the
DWGTF; and (ii) accept the approved grant funding.
Other Approvals. As a regulated public utility, PEU must obtain approval of the term
loan/grant from the New Hampshire Public Utilities Commission (“NHPUC”), which will
approve the term loan/grant if it finds the loan to be consistent with the public good. PEU is
filing a petition for approval with the NHPUC contemporaneously with this notice to the City
and expects the NHPUC to consider the petition promptly.
Requested Approvals. For the reasons described above, Pennichuck respectfully requests that
the City, acting in its capacity as sole shareholder of Pennichuck and pursuant to Article [X(3) of
Pennichuck’s Articles of Incorporation, authorize the following actions:
RESOLVED, that the City hereby approves the loan to Pennichuck East Utility, Inc.
from the Drinking Water and Groundwater Trust Fund (DWGTHF), in an amount of up
to $493,500, with a 25-year amortization schedule; and
FURTHER RESOLVED, that the City hereby approves the acceptance of the grant of
$211,500 from the DWGTF by Pennichuck East Utility, Inc.; and
