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| A loan program |
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A loan program for the construction and/or improvements of public and private water systems.
| The Safe Drinking Water Fund is capitalized by annual grants from the U.S. Environmental Protection Agency (EPA) and matched with state resources. The program is managed jointly by the Department of Human Services (Drinking Water Program) and the Economic and Community Development Department (OECDD). |
The Safe Drinking Water financing program provides low-cost financing for construction and/or improvements of public and private water systems. This is accomplished through two separate programs:
- Safe Drinking Water Revolving Loan Fund (SDWRLF) for collection, treatment, distribution and related infrastructure
- Drinking Water Protection Loan Fund (DWPLF) for sources of drinking water prior to system intake
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| Eligible applicants |
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Municipal, nonprofit and privately owned systems are eligible. The program's financing is available to all sizes of water systems, although 15 percent of the funds are reserved for systems serving a population of fewer than 10,000.
An eligible borrower is any water system (publicly, nonprofit or privately owned, but never federally owned or operated) that serves year-round residents numbering at least 25, or via 15 or more service connections (or a nonprofit with 25 or more regular users).
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| Eligible activities |
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First and foremost, a funded project must resolve an existing or potential health hazard or noncompliance under federal/state standards related to the public provision and conveyance of water for human consumption. The following are the main types of eligible activities and expenses:
- Engineering, design, upgrade, construction or installation of system improvements and equipment for water intake, filtration, treatment, storage, transmission
- Acquisitions of property, easements or the like, as needed to site, build, operate or protect facility or water source
- Planning, surveys, legal/technical support, environmental review and so forth, arising from or attendant to improvement
- Investments to enhance the physical security of drinking water and associated facilities, as well as water sources
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| Ineligible activities |
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Ineligible activities and project costs include:
- Dams
- Water rights
- Administration
- Ongoing operations
- Primarily for fire suppression
- Project that does not directly address (most severe) noncompliance/health risk
- Serves future community growth beyond that justified using conventional population projections over project life
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| Funding |
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The Safe Drinking Water Revolving Loan Fund (SDWRLF) lends up to $4 million per project—with possibility of subsidized interest rate and principal forgiveness for Disadvantaged Community.
The standard loan term is 20 years or the useful life of project assets, whichever is less, and may be extended up to 30 years under SDWRLF for a Disadvantaged Community. Interest rates are only 80 percent of state/local bond rate.
The maximum award for the Drinking Water Protection Loan Fund (DWPLF) is $100,000 per project.
Letters of interest
Before applying to the department for funding (except for an emergency project), the water system must have submitted a Letter of Interest:
- SDWRLF—Letters of Interest are collected on an annual cycle, so that all recently proposed projects can be rated and ranked for purposes of the Intended Use Plan (IUP) provided each year to the U.S. Environmental Protection Agency (USEPA).
- DWPLF—Letters of Interest may be submitted at any time; the department accepts final applications on a first-come/first-serve basis (subject to eligibility).
Schedule for submitting Letters of Interest and the form—available at the Department of Human Services.
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| Project priority list |
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The ranking of SDWRLF proposals becomes the Project Priority List, upon acceptance of the IUP by USEPA. According to the available funds for the federal fiscal year, this Priority List determines which projects are permitted to make final application to the department.
For DWPLF projects, submitted Letters of Interest, are reviewed by the Department of Environmental Quality and Department of Human Services, Drinking Water Section to determine the rating of each project. Those projects receiving 50 points are placed on the "A" list. Those below 50 points are placed on a "B" list. So long as funds are sufficient, all awards will be made on a first-come, first-serve basis, subject to an accepted final application.
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