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CLEAN WATER AND DRINKING WATERSTATE REVOLVING FUND PROGRAMS

SURVEY OF FISCAL SUSTAINABILITY PLAN AND ASSET MANAGEMENT REQUIREMENTS

American Water Works Association Asset Management Committee

July 2017

Based on a 2016 survey of Clean Water and Drinking Water State Revolving Fund (SRF) program managers, this report provides a summary of how states are implementing Fiscal Sustainability Plan and Asset Management requirements. The report also recommends steps to help water and wastewater utilities adopt effective asset management practices.

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CLEAN WATER AND DRINKING WATERSTATE REVOLVING FUND PROGRAMS

SURVEY OF FISCAL SUSTAINABILITY PLAN AND ASSET MANAGEMENT REQUIREMENTS

AWWA Asset Management CommitteeJuly 2017

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Executive Summary

As water infrastructure continues to age and degrade, some utilities will struggle to provide their customers reliable, high-quality services. According to the American Water Works Association's (AWWA ) annual State of the Water Industry Report, financing capital improvements and renewing and replacing aging infrastructure are the most important challenges facing the water utility industry today. Asset Management Programs can help utilities meet these challenges. Effective programs can help utilities operate more efficiently, prolong asset life, make informed decisions (e.g., when to conduct maintenance activities; whether to repair, rehabilitate, or replace an asset), plan and pay for future repairs and replacements, justify system needs and decisions, and set and gain support for appropriate user rates.

AWWA's Asset Management Committee (AMC ) guides the Association's efforts to promote and advance effective asset management practices in the water utility industry. The AMC also helps utilities develop and implement Asset Management Programs by providing technical tools and publications, webinars, presentations at conferences, and access to information on AWWA's Asset Management Resource Community web page.

In 2014, Congress passed the Water Resources Reform and Development Act (WRRDA). To improve return on community investments, the Act requires utilities seeking loans from Clean Water State Revolving Fund (CWSRF) programs to develop Fiscal Sustainability Plans (FSPs). FSPs include many components of an asset management plan (AMP)(e.g., asset inventory, condition assessment, and funding strategies. FSPs also require utilities to evaluate measures to improve energy and water efficiency - which are also common asset management practices.

The AMC developed a web-based survey to better understand how state agencies are implementing FSP requirements and encouraging drinking water and wastewater utilities to use asset management practices. In 2016, the CWSRF and Drinking Water State Revolving Fund (DWSRF) program managers in all 50 states and Puerto Rico were asked to complete the survey. The survey solicited information from each program manager regarding their FSP requirements; the stakeholders and resources used to develop FSP requirements; efforts to promote asset management (e.g., incentives, tools, and training; funding sources available to help utilities develop and implement asset management programs; and the state's future directions related to FSP and asset management efforts. The AMC presented preliminary analysis of the survey results at the 2016 AWWA Annual Conference and Exposition (ACE16) in Chicago, IL. Also at ACE16, representatives from Connecticut's, Illinois', Michigan's, and New Jersey's SRF programs described their efforts to promote asset management practices.

This report describes how states are implementing water utility asset management requirements through SRF and other programs. Forty-three CWSRF agencies and 41 DWSRF agencies in 46 states completed the survey (82.4%) of contacted agencies. This report includes summaries and analyses of the agencies' responses. Many states are actively developing asset management requirements and incentives. The survey was conducted in 2016, so the results might not reflect the current status of the states' programs. Limited conclusions may be drawn for DWSRF programs, because only a few states have implemented asset management requirements for drinking water utilities.

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Survey Findings

Of the surveyed CWSRF programs, 34 (79%), reported that FSP/AMP requirements had been implemented in their state. In 59% of the CWSRF programs with FSP/AMP requirements, applicability is limited to only the assets for which CWSRF funding is sought. The majority (79%) of CWSRF programs with FSP/AMP provisions require certification that an FSP has been prepared, but do not require submittal of the FSP document. Of the seven CWSRF programs that require the FSP to be submitted, four reported that the documents are formally reviewed. Few CWSRF programs (6%) reported follow up requirements related specifically to FSP implementation, and 71% reported that they currently have no follow-up requirements. The majority (85%) of CWSRF agencies provide some type of guidance to utilities related to FSP requirements. In addition to the basic requirement, some CWSRF programs provide priority points for FSP’s. The majority (80%) of CWSRF program managers reported either that no other state agency has asset management related requirements, or that they are unsure if they do.

Of the surveyed DWSRF programs, seven (17%), reported that FSP/AMP requirements had been implemented in their state. In six out of the seven DWSRF programs with FSP/AMP requirements, they are applicable to all assets in the utility’s system. Five out of seven DWSRF programs with FSP/AMP requirements require submittal of the FSP/AMP document. Of the five DWSRF programs that reported that submittal of FSP/AMP documents is required, four reported that the documents are formally reviewed. Three out of seven of the DWSRF programs with FSP/AMP requirements reported follow up requirements related to implementation, reporting, or periodic update of plans. All seven DWSRF agencies with FSP/AMP requirements provide some type of guidance to utilities related to requirements. Some DWSRF programs provide incentives for FSPs/AMPs, including priority points, subsidies, and future interest rate reduction. Six out of the seven DWSRF programs with FSP/AMP requirements reported that they are unsure if other state agencies have asset management related requirements.

Both CWSRF and DWSRF programs reported that very little state-level data related to utility assets and planned investments is available to inform policy-making and regulatory efforts. Some CWSRF and DWSRF programs have implemented cost-effective collaborative efforts with third-party organizations to provide training and direct assistance to utilities.

Recommendations

Based on the survey findings, the AMC recommends the following key actions to help utilities adopt and implement effective asset management practices (see page 20 for more recommendations).

Provide utilities more training and assistance

Utilities, especially small utilities with limited technical and financial resources, need more training and assistance to develop and implement effective asset management practices. The AWWA, Association of State Drinking Water Administrators, Environmental Finance Centers, Environmental Protection Agency, National Rural Water Association, Rural Community Assistance Program, United States Department of Agriculture's Rural Development Program, and others should collaborate to strengthen training and assistance programs for utilities.

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements iv

Leverage state experiences and resources.

Several states have developed asset management related resources (e.g., tools and training materials) and have policy and program insights that others can benefit from. States should enhance their efforts to share information and resources with each other. The water sector should study the effectiveness of unique funding programs and incentives that states (e.g., Michigan) use to encourage effective asset management practices, and encourage all states to adopt the best ones.

Conduct formal reviews of FSPs.

States should have qualified individuals conduct formal reviews of FSPs using state-approved criteria.

Provide utilities incentives to implement asset management plans.

To get all the benefits from asset management practices, utilities must implement - not just develop - a FSP/AMP. States should provide utilities incentives to fully implement FSPs/AMPs, and encourage them to conduct risk assessments and benefit-cost analyses to make better infrastructure repair, renewal, and replacement decisions.

Collect data about utility infrastructure needs and asset management practices to inform policy decisions.

To make better policy and funding decisions, states should collect data regarding utility infrastructure needs and asset management practices. Data such as infrastructure age, condition, and replacement costs; along with utility planning and asset management practices should be used to:• Inform policy makers about the extent and financial ramifications of drinking water, stormwater, and wastewater infrastructure needs;• Assess policy trade-offs between risks, service levels, and long-term financial planning; and• Refine estimates of national infrastructure needs.

Long-term replacement planning tools should be used to promote consistent data collection by utilities. Buried No Longer, KANEW, Nessie or similar strategic asset replacement planning tools can be used to provide consistent data collection practices among utilities.

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements v

ABOUT AWWA

The American Water Works Association (AWWA) is an international, nonprofit, scientific and educational society dedicated to providing total water solutions assuring the effective management of water. Founded in 1881, the Association is the largest organization of water professionals in the world. Our membership includes over 3,900 utilities that supply roughly 80 percent of the nation’s drinking water and treat almost half of the nation’s wastewater. Our nearly 50,000 members represent the full spectrum of the water community: public water and wastewater systems, environmental advocates, scientists, academicians, engineers, manufacturers, and others who hold a genuine interest in water, our most important resource. AWWA unites the diverse water community to advance public health, safety, the economy, and the environment.

AWWA Asset Management Committee

The Asset Management Committee’s primary role is to help water utilities improve management of their physical and human assets by sharing information on best practices. Information that is shared includes methodologies for preparing asset inventories, evaluating asset condition and predicting failure, setting level of service goals, developing likelihood, consequences and risks of failure, determining residual life, life cycle costs and renewal costs, prioritizing projects based on value, optimizing maintenance activities, and developing strategies for managing information to support these objectives. The committee’s intent is to promote proactive and cost-effective management of water utility assets.

The committee has conducted other surveys which compliment this report, including a 2015 survey on the state of asset management practice throughout the water utility sector. The committee also provides training, educational resources, and an on-line resource page to promote advanced asset management practices for the sector. Finally, the committee supports activities of the entire Association in promoting effective utility management and good stewardship of utility infrastructure assets.

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements vi

ACKNOWLEDGEMENTS

The AWWA Asset Management Committee gratefully acknowledges the participation of all State Revolving Fund (SRF) program managers who completed the survey. We are especially grateful to the following individuals, who attended ACE16 and spoke about their state’s respective efforts to promote the advancement of effective utility asset management practices.

Gary Bingenheimer, Pre-Construction Unit Supervisor, Infrastructure Financial Assistance Section, Illinois Environmental Protection Agency

Dan Kennedy, Assistant Commissioner, New Jersey Department of Environmental Management Bob Schneider, Financial Analyst, Michigan Department of Environmental Quality Julie Silva, Sanitary Engineer, Drinking Water Section, Connecticut Department of Public Health

The AWWA AMC’s SRF Survey Subcommittee developed and conducted this survey. The subcommittee included the following personnel, presented in alphabetical order.

Dan Haddock, Subcommittee Chair, Director of Water Utility Services, INTERA, Inc., Indianapolis, IN

Christian Andreasen, Director of Engineering, Middlesex Water Company, Iselin, NJ Kevin Campanella, Utilities Planning Leader, Burgess & Niple, Columbus, OH Fred W. Clark, Sr., Vice President, Clark Land Resources, Inc., Vista, CA David Conner, Senior Project Manager, AECOM, Denver, CO Tom DeLaura, President, DeLaura Consulting, Detroit, MI Elizabeth Foster, Senior Coordinator and Volunteer Advisor (formerly), AWWA, Denver, CO Heather Himmelberger, Director, Southwest Environmental Finance Center, Albuquerque, NM Theresa Jurotich, CDM Smith, Seattle, WA Jeffrey Leighton, past-AMC Chair, Senior Engineer, Portland Water Bureau, Portland, OR John Marciszewski, Director of Business Development, Echologics, Rumson, NJ Ryan Nagel, Senior Associate, Asset and Utility Management Practice Leader, Hazen and Sawyer,

Norfolk, VA Venkat Radhakrishnan, Project Engineer, ARCADIS, Carlsbad, CA Aditya Ramamurthy, Senior Associate, Asset & Utility Management, Hazen and Sawyer, Virginia

Beach, VA Jennifer Santini, Engineer(formerly), AWWA, Denver, CO Carl Sharkey, Business Development Manager, Pure Technologies, Ltd., Davis, CA Lilly Shraibati, Group Manager, Metropolitan Water District of Southern California, Los Angeles, CA Kevin Slaven, Associate Vice President, ARCADIS, Cleveland, OH Jennifer Suttles, Engineer, Gwinnet County Department of Water Resources, Lawrenceville, GA Annie Vanrenterghem Raven, Managing Director, infraPLAN, New York, NY Kurt Vause, AMC Chair, Special Projects Director, Anchorage Water and Wastewater Utility,

Anchorage, AK Thais Vitagliano, Asset Management Program Manager, Washington Suburban Sanitary

Commission, Washington, DC

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements vii

ACRONYMS

AMC – Asset Management Committee (AWWA)

AMP – Asset Management Plan

AWWA – American Water Works Association

CAPEX – Capital Expenditure

CUPSS – Check Up Program for Small Systems (USEPA)

CWSRF – Clean Water State Revolving Fund

DWSRF – Drinking Water State Revolving Fund

EFC – Environmental Finance Center

EUM – Effective Utility Management

FSP – Fiscal Sustainability Plan

IAM – Institute of Asset Management

IIMM – International Infrastructure Management Manual

ISO – International Organization for Standardization

NPDES – National Pollutant Discharge Elimination System

NRWA – National Rural Water Association

OPEX – Operating Expense

RCAP – Rural Community Assistance Partnership

SIMPLE – Sustainable Infrastructure Management Program Learning Environment

SRF – State Revolving Fund

TMF – Technical Managerial Financial

UPIS – Utility Plant in Service

USEPA – United State Environmental Protection Agency

WERF – Water Environment Research Foundation

WRRDA - Water Resources Reform and Development Act

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements viii

TABLE OF CONTENTS

EXECUTIVE SUMMARY.................................................................................................................................. ii

ABOUT AWWA .............................................................................................................................................. v

ACKNOWLEDGEMENTS ................................................................................................................................ vi

ACRONYMS ................................................................................................................................................. vii

TABLE OF CONTENTS .................................................................................................................................. viii

LIST OF FIGURES ........................................................................................................................................... ix

BACKGROUND ............................................................................................................................................... 1

METHODOLOGY ............................................................................................................................................ 2

RESULTS ........................................................................................................................................................ 3

CONCLUSIONS ............................................................................................................................................. 17

RECOMMENDATIONS ................................................................................................................................. 20

RESOURCES ................................................................................................................................................. 21

APPENDIX 1: Excerpts from Water Resources Reform and Development Act (WRRDA) of 2014 .............. 22

APPENDIX 2: Responding SRF Agencies by State ........................................................................................ 25

APPENDIX 3: 2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements .............................................................................................................................................. 26

APPENDIX 4: DWSRF Survey Results ........................................................................................................... 33

APPENDIX 5: Presentations from Special Technical Session, ACE16, Chicago, IL, June 22, 2016 ............... 42

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements ix

LIST OF FIGURES

Figure 1. Responses received from State Revolving Fund (SRF) Agencies .................................................... 3 Figure 2. CWSRF agencies that require Fiscal Sustainability Plans (n=43) .................................................... 4 Figure 3. DWSRF agencies that require Fiscal Sustainability Plans or Asset Management Plans (n=41) ..... 4 Figure 4. CWSRF and DWSRF program variation in requirements for Fiscal Sustainability Plans and criteria ........................................................................................................................................................... 5 Figure 5. Scope of required CWSRF Fiscal Sustainability Plans (n=34) ......................................................... 5 Figure 6. Required asset management plan components of CWSRF program Fiscal Sustainability Plans (n=34) ............................................................................................................................................................ 6 Figure 7. Sources of information and assistance used by CWSRF agencies when developing Fiscal Sustainability Plan requirements (n=34) ....................................................................................................... 7 Figure 8. Stakeholders consulted by CWSRF agencies when developing Fiscal Sustainability Plan requirements (n=34) ..................................................................................................................................... 8 Figure 9. CWSRF program submittal requirements for Fiscal Sustainability Plans (n=34) ........................... 8 Figure 10. Individuals authorized to certify CWSRF Fiscal Sustainability Plan submittals (n=34) ................ 9 Figure 11. Stage at which CWSRF agencies require Fiscal Sustainability Plan submittals. (n=34)................ 9 Figure 12. CWSRF agency follow-up requirements after initial Fiscal Sustainability Plan submittals (n=34) .................................................................................................................................................................... 10 Figure 13. CWSRF program Fiscal Sustainability Plan-related loan requirements (n=34) .......................... 11 Figure 14. CWSRF agency provided guidance on Fiscal Sustainability Plan requirement. (n=34) .............. 11 Figure 15. Fiscal Sustainability Plan-related guidance on CWSRF agency website (n=34) ......................... 12 Figure 16. CWSRF agency-facilitated access to software tools, templates, or guides. (n=34) ................... 12 Figure 17. CWSRF agency partnerships with other organizations to provide Fiscal Sustainability Plan-related guidance and support to utilities. (n=34) ....................................................................................... 13 Figure 18. Additional support available to small utilities for CWSRF program Fiscal Sustainability Plan-related requirements (n=34) ...................................................................................................................... 13 Figure 19. CWSRF agency response to availability of state-level data related to utility asset management needs and practices (n=34) ......................................................................................................................... 14 Figure 20. CWSRF agency responses to knowledge of other state regulatory agencies with asset management requirements (n=34)............................................................................................................. 14 Figure 21. CWSRF agency responses to knowledge of established and communicated standards for utility asset management and the source of the models used for their development (n=34) ............................. 15 Figure 22. CWSRF program funding available for Fiscal Sustainability Plan development (n=34) ............. 15 Figure 23. CWSRF agency responses to anticipated future changes in Fiscal Sustainability Plan requirements (n=34) ................................................................................................................................... 16 Figure 24. CWSRF program responses to apparent need for training of utilities to fully implement Fiscal Sustainability Plans (n=34) .......................................................................................................................... 16 Figure 25. Scope of required DWSRF Fiscal Sustainability Plans (n=7) ....................................................... 33 Figure 26. Required asset management components of DWSRF program Fiscal Sustainability Plans (n=7) .................................................................................................................................................................... 33 Figure 27. Sources of information and assistance used by DWSRF agencies when developing Fiscal Sustainability Plan requirements (n=7) ....................................................................................................... 34

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements x

Figure 28. Stakeholders consulted by DWSRF agencies when developing Fiscal Sustainability Plan requirements (n=7) ..................................................................................................................................... 34 Figure 29. DWSRF program submittal requirements for Fiscal Sustainability Plans .................................. 35 Figure 30. Individuals authorized to certify DWSRF Fiscal Sustainability Plan submittals (n=7) ................ 35 Figure 31. Stage at which DWSRF agencies require Fiscal Sustainability Plan submittals. (n=7) ............... 35 Figure 32. DWSRF agency follow-up requirements after initial Fiscal Sustainability Plan submittals (n=7) .................................................................................................................................................................... 36 Figure 33. DWSRF program Fiscal Sustainability Plan-related loan requirements (n=7) ............................ 37 Figure 34. DWSRF agency provided guidance on Fiscal Sustainability Plan requirement. (n=7)................ 37 Figure 35. Fiscal Sustainability Plan-related guidance on DWSRF agency website (n=7) ........................... 37 Figure 36. DWSRF agency-facilitated access to software tools, templates, or guides. (n=7) ..................... 38 Figure 37. DWSRF agency partnerships with other organizations to provide Fiscal Sustainability Plan-related guidance and support to utilities. (n=7) ......................................................................................... 38 Figure 38. Additional support available to small utilities for DWSRF program Fiscal Sustainability Plan-related requirements (n=7)......................................................................................................................... 38 Figure 39. DWSRF agency response to availability of state-level data related to utility asset management needs and practices (n=7) ........................................................................................................................... 39 Figure 40. DWSRF agency responses to knowledge of other state regulatory agencies with asset management requirements (n=7)............................................................................................................... 39 Figure 41. DWSRF agency responses to knowledge of established and communicated standards for utility asset management and the source of the models used for their development (n=7) .................... 40 Figure 42. DWSRF program funding available for Fiscal Sustainability Plan development (n=7) ............... 40 Figure 43. DWSRF agency responses to anticipated future changes in Fiscal Sustainability Plan requirements (n=7) ..................................................................................................................................... 41 Figure 44. DWSRF program responses to apparent need for training of utilities to fully implement Fiscal Sustainability Plans (n=7) ............................................................................................................................ 41

2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements 1

BACKGROUND

Effective utility management of infrastructure assets is critical to ensuring safe, reliable, and affordable water services. Effective asset management requires, among other things, utility knowledge of the condition and criticality of assets, definition of service levels to be met, and public understanding of the value of water infrastructure and the cost to maintain it. The importance of asset management to the water industry is reflected in the results of the State of the Water Industry Report produced annually by the American Water Works Association (AWWA). In 2016, renewal and replacement of infrastructure, financing for capital improvements, and public understanding of the value of water systems and services were the top three issues identified by the survey.

The Asset Management Committee (AMC) of the American Water Works Association (AWWA) conducted this survey of State Revolving Fund (SRF) agencies to better understand plans and strategies across the country to implement asset management requirements for utilities, such as those established in the 2014 Water Resources Reform and Development Act (WRRDA), included in Appendix 1. Many of the water and wastewater utility professionals that will prepare and implement Fiscal Sustainability Plans (FSPs) are AWWA members. The mission of the AMC is to promote proactive and cost-effective management of utility assets. The AMC’s interest in conducting this survey is to better understand how legislative requirements for FSPs and other government agency efforts to advance the practice of asset management are being implemented across the country. Further, the survey is intended to educate our AWWA members of what may be required of them when seeking agency support of infrastructure management needs to help ensure the success of such efforts.

WRRDA requires recipients of Clean Water State Revolving Fund (CWSRF) loans for eligible repair, replacement, or expansion of treatment works (utility system) to develop and implement a fiscal sustainability plan that includes:

• an inventory of critical assets that are part of the treatment works;• an evaluation of the condition and performance of inventoried assets or asset groupings;• a certification that the assistance recipient has evaluated and will be implementing water and

energy conservation efforts as part of the plan; and• a plan for maintaining, repairing, and, as necessary, replacing the treatment works and a plan

for funding such activities.

The requirements for FSPs include many of the general components of an asset management plan, as well as certification of water and energy conservation efforts. In this survey, the terms Fiscal Sustainability Plan and Asset Management Plan refer to the following:

• Fiscal Sustainability Plan (FSP) – as required by WRRDA 2014, described above.• Asset Management Plan (AMP) - a set of practices used to ensure that utility assets provide a

level of service that meets the needs of utility customers at the lowest life-cycle cost andacceptable level of risk. Practices include inventory of assets, assessment of asset condition,performance and risk, and risk-based planning to optimize maintenance, renewal andreplacement of assets. Asset management is an integral component of a FSP.

For simplicity, Fiscal Sustainability Plans and Asset Management Plans will be commonly referred to in the report by the combined acronym FSP/AMP.


METHODOLOGY

A subcommittee of the AMC was formed in August 2015, and from September to November 2015 developed the survey content and web-based survey tool. Responsibility for contacting each state CWSRF and DWSRF program was divided among members of the subcommittee. Between November and December 2015, subcommittee members contacted CWSRF and DWSRF program managers to introduce themselves and AWWA, explain the goals of the AMC and the purpose of the survey, and to solicit their participation. The web-based survey was open from December 2015 through February 2016, during which time subcommittee members followed up with their assigned state agencies to encourage participation, respond to questions, and document relevant comments.

The survey was designed to obtain information about the different approaches that states have taken in implementing the FSP requirement for CWSRF enacted through WRRDA. The survey also sought to obtain information helpful to understanding broader state efforts to facilitate and incentivize the adoption of effective asset management practices by drinking water and wastewater utilities. The survey solicited responses in the following areas:

• FSP/AMP requirements• FSP/AMP incentives and funding• Broader state-level efforts to promote asset management• Stakeholder involvement• Training and other assistance to utilities• Data for planning and benchmarking• Future needs and plans

After removing duplicate responses from the same SRF program, 43 CWSRF and 41 DWSRF program managers representing 46 states completed the “Survey of SRF Program Implementation of Asset Management Requirements.” A summary by state of the CWSRF and DWSRF agencies that responded to the survey is provided in Appendix 2. Aggregated summaries and discussion of the survey responses are presented in the report. Survey results are subject to change, as many states are actively developing these aspects of their programs. Limited conclusions may be drawn for DWSRF programs, because few states have implemented asset management requirements for those programs. The full survey questionnaire is in Appendix 3.


RESULTS

The aggregated survey responses and subsequent analysis are presented in this section. Survey responses were limited to one response from each state CWSRF and DWSRF program. The response rate from CWSRF and DWSRF agencies in the 50 states, plus Puerto Rico was approximately 82.4%. Non-duplicate survey responses were submitted by 43 CWSRF agencies and 41 DWSRF agencies. Figure 1 shows which states provided responses from one or both agencies.

Figures in the report indicate the number of responses received for a given question as “n”. Survey results for CWSRF programs are described below in the main body of the report. WRRDA did not mandate the implementation of FSP requirements for DWSRF programs, and as a result few states have implemented asset management programs. Because there were relatively few programs, limited conclusions may be drawn for DWSRF programs. The survey results for DWSRF programs are mentioned briefly in the main body of the report and full results are included in Appendix 4. Survey results are subject to change, as many states are actively developing these aspects of their programs.

Survey responses are presented and discussed below. For each survey question, the question is presented, followed by a summary of the results and a brief discussion. For ease of reading, some survey questions have been further edited in the text of the report. The exact wording of survey questions may be found in Appendix 3.

Figure 1. Responses received from State Revolving Fund (SRF) Agencies

Both One Neither

82.4% response rate


Q: Is development of a Fiscal Sustainability Plan (FSP) in some form currently required to receive funding for construction through the State Revolving Fund (SRF)?

As shown in Figure 2, approximately 79% (34) of the responding CWSRF agencies have implemented a requirement for FSPs. WRRDA established that to be eligible for CWSRF funding in the form of SRF loans, a utility must develop and implement a fiscal sustainability plan. States provide SRF financial support to utilities in several different ways, including making loans; buying or refinancing existing local debt obligations; guaranteeing or purchasing insurance for local debt obligations; guaranteeing SRF debt obligations; providing loan guarantees for sub-state revolving funds; earning interest on fund accounts; and supporting reasonable costs of administering the SRF. Some CWSRF agencies that do not directly loan funds reported that they have not established FSP requirements, based on the interpretation that the FSP requirement of WRRDA only applies to those agencies providing loans.

Figure 3 shows that 17% (7) of the responding DWSRF agencies have implemented a requirement for FSPs or similar asset management plans. WRRDA did not establish a FSP requirement for DWSRF programs. The states that have implemented a requirement have done so because of state-specific objectives to improve water utility asset management practices.

From this point forward in the report, presented survey responses are from the 34 CWSRF and 7 DWSRF agencies that indicated they have implemented FSP or similar asset management requirements, hereafter referred to as FSP/AMP requirements.

Q: Do the requirements for Fiscal Sustainability Plans for this program vary by size of utility? How do the requirements vary? What criteria are used for determining requirements?

As shown in Figure 4, very few of the surveyed CWSRF and DWSRF agencies reported that the requirements for FSPs/AMPs vary by the size of utility. One CWSRF agency varies the timing and the extent of required documentation based on system flow capacity and the type of wastewater

Figure 2. CWSRF agencies that require Fiscal Sustainability Plans (n=43)

No21%

Yes79%

Figure 3. DWSRF agencies that require Fiscal Sustainability Plans or Asset Management Plans (n=41)

No83%

Yes17%


treatment. Another CWSRF agency varies the timing and technical requirements of the FSP/AMP by the population served by the utility. One DWSRF agency varies requirements in that an FSP/AMP is only required when loan principal is forgiven, for “disadvantaged” systems, which are typically utilities serving smaller communities.

Q: Is a Fiscal Sustainability Plan required for the full utility system, part of the system, or only the specific assets included in the project that is a candidate for SRF-funding?

States have taken different approaches to the scope of FSPs/AMPs required for project funding. Some require FSPs/AMPs for the entire utility system (all assets), others require them to cover only the part of the system the project for which the SRF funding is sought pertains to (collection system, treatment

Figure 4. CWSRF and DWSRF program variation in requirements for Fiscal Sustainability Plans and criteria

2

1

CWSRF(n=34)

DWSRF(n=7)

No Yes

Variation Criteria"A" Phased timing, extent

of documentationSystem flow capacity,

type of treatment"B" Phased timing,

technical req.Population served

Variation Criteria"C" Required only for

principal forgiveness“Disadvantaged"

system

Note: percentages may not total to 100%, due to rounding

Figure 5. Scope of required CWSRF Fiscal Sustainability Plans (n=34)

18%

18%

59%

6%

All utility assets

All assets in part of system

SRF project-related assets

No response

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


plant). Finally, some states require the FSP/AMP to cover only those assets in the project for which SRF funds are sought. Figure 5 shows the percentage of CWSRF agencies that have established requirements based on the scope. The majority (59%) of CWSRF agencies require FSPs/AMPs only for project assets. Six of the seven DWSRF agencies with FSP/AM requirements apply it to the full system. Survey results for DWSRF agencies are presented in Appendix 4.

Q: What asset management plan components are required in the Fiscal Sustainability Plan?

The required components of FSPs/AMPs vary by state. Figure 6 shows the percentage of CWSRF agencies requiring various components of asset management plans. More than half of the agencies require the basic components of asset inventory and condition, and replacement and maintenance costs. Fewer agencies require more advanced components such as analysis of criticality and risk, Capital Expenditures (CAPEX) and Operating Expense (OPEX) forecasts, financial strategies, and implementation

plans. For many of the states, this is the first time that FSP/AMP requirements have been established for utilities participating in the CWSRF program; thus, initial requirements are more basic. Other requirements not listed in the survey that were identified by states include the assessment of opportunities for water and energy required by WRRDA, and GIS mapping of utility assets. The number of DWSRF agencies requiring various components of asset management plans is shown in Appendix 4.

Figure 6. Required asset management plan components of CWSRF program Fiscal Sustainability Plans (n=34)

76%

56%

79%

44%

26%

65%

71%

56%

35%

32%

41%

24%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Asset inventory

Remaining service life

Condition assessment

Criticality

Risk

Replacement cost

Maintenance plan

Rehab and replace strategies

CAPEX forecast

OPEX forecast

Financial strategy

Implementation plan


Q: What sources of information or assistance were relied upon to establish Fiscal Sustainability Plan requirements?

CWSRF and DWSRF program managers were asked which sources of information and guidance they used to inform their planning for implementation of the FSP/AMP requirement. Most states relied on the USEPA as a source of information and guidance, followed by examples of programs developed by other states. One DWSRF program relied on information from the Water Environment Research Foundation (WERF) Sustainable Infrastructure Management Program Learning Environment (SIMPLE). Other sources of information included USEPA Technical, Managerial, and Financial (TMF) Capacity Checklists, The Water Research Foundation and other organizations’ Effective Utility Management (EUM) Attributes, and internal state resources. No SRF agency reported using International Infrastructure Management Manual (IIMM), International Organization for Standardization (ISO), or Institute of Asset Management (IAM) resources for program development. Figure 7 shows the percentages of CWSRF agencies that used various source of information. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 7. Sources of information and assistance used by CWSRF agencies when developing Fiscal Sustainability Plan requirements (n=34)

85%

35%

0%

0%

0%

0%

26%

0% 20% 40% 60% 80% 100%

USEPA

Other State

IIMM

ISO

IAM

WERF

Other


Q: What stakeholders were included in the development of the Fiscal Sustainability Plan requirements?

CWSRF and DWSRF agencies consulted with various stakeholders as they developed the FSP/AMP requirements for their funding programs. Stakeholders included utilities, professional organizations such as AWWA and others, consulting engineers working for utilities, USEPA regional representatives, and other state agencies. Figure 8 shows the percentages of CWSRF agencies that consulted with or involved various groups of stakeholders as FSP/AMP requirements were developed. For CWSRF agencies, the

most commonly reported stakeholder was the agency’s USEPA regional representatives. Approximately 24% of CWSRF agencies did not identify any stakeholders in their response. Survey results for DWSRF agencies are presented in Appendix 4.

Q: What type of submittal is required for this program – certification only or FSP document?

WRRDA establishes that to be eligible for a CWSRF loan, a utility must develop a FSP and submit certification that it has been completed. Most CWSRF agencies only require submittal of certification, but some require submittal of the FSP document along with certification. Figure 9 shows the percentages of CWSRF agencies that require submittal of certification only or FSP/AMP documents. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 8. Stakeholders consulted by CWSRF agencies when developing Fiscal Sustainability Plan requirements (n=34)

24%

24%

38%

50%

9%

24%

0% 20% 40% 60% 80% 100%

Large & medium utilitiesSmall utilities

Prof orgs and consultantsUSEPA region rep

Other State agencyNone/no response

Figure 9. CWSRF program submittal requirements for Fiscal Sustainability Plans (n=34)

79%

21%

0%

FSP certification only

FSP document

Other

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


Q: Who must certify the submittal?

Figure 10 shows who is authorized by CWSRF agencies to certify FSP/AMP development. For CWSRF agencies, utility boards, mayor, utility director, and professional engineers are the most commonly

authorized. Other responses from CWSRF agencies included other representatives duly authorized by the utility. Survey results for DWSRF agencies are presented in Appendix 4.

Q: At what stage in the SRF-funded project is the submittal required?

FSP/AMP certification or document submittals are required at different phases in the SRF project process by different state agencies. Figure 11 shows the percentages of CWSRF agencies that require submittals at loan application, closing, disbursement, or at another stage, respectively. Submittals are most commonly required at loan disbursement, followed by submittal at closing and application. Other responses from CWSRF agencies included submittal with the Preliminary Engineering Report (PER), at the 50% disbursement, before bidding, before final payment, and within six months of substantial completion. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 10. Individuals authorized to certify CWSRF Fiscal Sustainability Plan submittals (n=34)

12%

0%

15%

53%

12%

0%

41%

0% 20% 40% 60% 80% 100%

PE

Utility Operator

Mayor

Utility Board

Utility Director

CPA

Other

Figure 11. Stage at which CWSRF agencies require Fiscal Sustainability Plan submittals. (n=34)

9%

15%

24%

47%

6%

0% 20% 40% 60% 80% 100%

ApplicationLoan closing

Loan disbursementOther

No response


Q: If the state requires submittal of Fiscal Sustainability Plans for this program, are they formally reviewed? If so, who reviews them? What criteria are used for review of the content? Upon review are they approved or rejected based on satisfying criteria, or acknowledged as reviewed?

As shown in Figure 9, approximately 21% (7) of CWSRF agencies require submittal of FSP documents as part of the SRF program. Of these seven agencies, four formally review the content of the plans. Agencies that do not formally review the content of the plans reported that they verify their completion. The type of review reported by CWSRF agencies includes internal agency checklists; technical, managerial, and financial components; and WRRDA requirements. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Are there follow-up requirements after the initial submittal of the Fiscal Sustainability Plan (FSP)?

As shown in Figure 12, most (71%) of the responding CWSRF agencies do not currently have follow-up requirements after initial FSP submission. None of the agencies indicated that they have follow-up

reporting requirements, and approximately 6% reported some type of follow-up on implementation. Survey results for DWSRF agencies are presented in Appendix 4.

Q: How are Fiscal Sustainability Plans considered in the selection of projects for funding under this program?

The responses to this question suggest that one of the survey response options was poorly explained. To comply with the requirements of WRRDA, all CWSRF agencies with FSP/AMP requirements should have identified eligibility as a basic way in which FSPs/AMPs are considered for the selection of projects. In the survey results, only 59% of the CWSRF agencies with FSP/AMP requirements identified eligibility. Some of the other ways in which FSPs are considered in the selection of CWSRF projects include priority points and additional principal forgiveness. Some of the ways in which FSPs/AMPs are considered in the selection of DWSRF projects include priority points, subsidies, and future interest rate reduction.

Figure 12. CWSRF agency follow-up requirements after initial Fiscal Sustainability Plan submittals (n=34)

71%

0%

6%

21%

6%

0% 20% 40% 60% 80% 100%

None

Reporting

Implementation

Other

No response


Q: Do loans include Fiscal Sustainability Plan (FSP)-related terms or conditions?

FSP/AMP requirements are often incorporated into the terms of the loan agreements executed between CWSRF and DWSRF agencies and utilities. The percentages of CWSRF agencies which include different types of FSP/AMP-related loan terms are shown in Figure 13. Most commonly, terms are related to FSP/AMP submittal and implementation. Other loan terms required by CWSRF agencies include submittal of FSP/AMP certification. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Does the state provide guidance to utilities on the SRF program’s Fiscal Sustainability Plan requirement?

A large majority (85%) of the CWSRF agencies reported that they provide guidance to utilities on the FSP requirement, as shown in Figure 14. Only 6% of CWSRF agencies reported that they do not provide any guidance. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 13. CWSRF program Fiscal Sustainability Plan-related loan requirements (n=34)

15%

35%

35%

21%

3%

0% 20% 40% 60% 80% 100%

None

FSP submittal

FSP implementation

Other

No response

Figure 14. CWSRF agency provided guidance on Fiscal Sustainability Plan requirement. (n=34)

85%

6%

9%

0% 20% 40% 60% 80% 100%

Yes

No

No response


Q: Is Fiscal Sustainability Plan-related guidance available on the state’s website?

State CWSRF agencies provide different types of guidance on their websites, as presented in Figure 15. The most common form of guidance reported to be available on agency websites is in the form of guidelines. Access to sample plans and links to external resources are also frequently provided. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Does the state facilitate access to asset management tools such as software, templates, or guides? If so, please describe.

As shown in Figure 16, 38% of the CWSRF agencies reported that they facilitate access to available asset management tools including USEPA Check-up Program for Small Systems (CUPSS), TMF checklists, EUM checklists, worksheets, access to the Rural Community Assistance Program (RCAP), and links to external vendors. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 15. Fiscal Sustainability Plan-related guidance on CWSRF agency website (n=34)

26%

38%

3%

12%

12%

21%

9%

0% 20% 40% 60% 80% 100%

None

Guidelines

Training material

Sample plans

External resources

Other

No response

Figure 16. CWSRF agency-facilitated access to software tools, templates, or guides. (n=34)

Yes38%

No56%

No response6%

0% 20% 40% 60% 80% 100%

CWSRF


Q: Does the state partner with other organizations to provide Fiscal Sustainability Plan-related guidance and support to utilities? If so, which organizations and what type of support is provided?

Approximately 21% of CWSRF agencies partner with other organizations to provide FSP/AMP-related guidance and support to utilities (Figure 17). CWSRF and DWSRF agencies reported collaboration with other state agencies, Environmental Finance Centers (EFCs), RCAP, Rural Water Associations, AWWA, and others. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Is additional Fiscal Sustainability Plan-related support available to small utilities? If so, what type?

Recognizing that small utilities may lack the technical and financial resources to develop and implement an effective FSP/AMP, CWSRF agencies in some states provide them with additional support. Figure 18 shows the percentage of agencies providing additional training, direct assistance, or additional funding. Other types of supplemental assistance provided by CWSRF agencies to smaller utilities include small system mapping and connection with RCAP for direct technical assistance. Approximately 41% of CWSRF

agencies provide no additional support to small utilities. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 17. CWSRF agency partnerships with other organizations to provide Fiscal Sustainability Plan-related guidance and support to utilities. (n=34)

Yes21%

No74%

No response6%

0% 20% 40% 60% 80% 100%

CWSRF

Figure 18. Additional support available to small utilities for CWSRF program Fiscal Sustainability Plan-related requirements (n=34)

41%

18%

15%

21%

29%

6%

0% 20% 40% 60% 80% 100%

No additional support

Additional training

Direct assistance

Additional funding

Other

No response


Q: What state-level data on utility asset management needs and practices is available?

State-level information on utility assets and planned investments is needed to develop the policies and programs that support the adoption of effective asset management practices by utilities. Figure 19 indicates the state-level data that CWSRF agencies reported to be available. CWSRF agencies reported the availability of very little state-level data, with 74% reporting none or no response. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Do other state regulatory agencies in your state require asset management plans for other purposes?

Figure 20 identifies the percentages of CWSRF agencies that report knowledge of the existence of FSP/AMP requirements by other agencies in their state. Most SRF program managers reported being

Figure 19. CWSRF agency response to availability of state-level data related to utility asset management needs and practices (n=34)

12%0%0%

12%0%3%3%

12%

3%74%

0% 20% 40% 60% 80% 100%

Utility practice of asset mgmtUtility assets

Utility Plant in ServicePlanned investments

Water main replacementWater main breaks

Asset conditionWater loss

OtherNone/no response

Figure 20. CWSRF agency responses to knowledge of other state regulatory agencies with asset management requirements (n=34)

62%18%

3%12%0%

3%0%0%6%6%

0% 20% 40% 60% 80% 100%

UnsureNone

Public Utility CommissionEnvironment

FinanceTransportation

ParksAdminstrative

OtherNo response


unsure if other agencies also have FSP/AMP requirements. Of the CWSRF agencies, 62% were unsure, 18% reported none, and 12% reported that the environmental regulator in the state also requires FSP/AMPs. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Has any other state agency established and communicated standards for utility asset management practices? If so, what were those standards modeled after?

Figure 21 identifies the percentages of CWSRF agencies that report that standards for asset management have been established and communicated by another agency in their state. Of the CWSRF agencies, 62% were unsure if standards had been established and 15% reported that standards have not been established. Of agencies that reported standards have been established, the USEPA and other state agencies were identified as the models used to develop those standards. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Is funding support available for Fiscal Sustainability Plan development?

Figure 22 shows the percentages of CWSRF agencies which provide grants or loans for FSP/AMP development. Approximately 12% of CWSRF agencies reported that they do not provide funding support for FSP/AMP development. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 21. CWSRF agency responses to knowledge of established and communicated standards for utility asset management and the source of the models used for their development (n=34)

62%15%12%6%0%0%0%0%

3%6%

0% 20% 40% 60% 80% 100%

UnsureNone

USEPAOther states

IIMMISO

IAMWERFOther

No response

Figure 22. CWSRF program funding available for Fiscal Sustainability Plan development (n=34)

12%24%76%6%

0% 20% 40% 60% 80% 100%

NoneGrantsLoans

No response


Q: Are future changes in applicability & scope of Fiscal Sustainability Plan requirements anticipated? If so, what changes?

As shown in Figure 23, 65% of CWSRF agencies reported that they do not currently anticipate future changes in FSP/AMP requirements. Of those agencies that anticipate future changes, some anticipate

extending requirements to be applicable to the entire system or to include additional components (see Figure 6), while others anticipate extending CWSRF FSP/AMP requirements to DWSRF programs. None reported plans to align FSP/AMP requirements with ISO 55000. Survey results for DWSRF agencies are presented in Appendix 4.

Q: Is there an apparent need for utilities to receive training to fully implement Fiscal Sustainability Plans?

A need for FSP/AMP training for utilities was identified by CWSRF and DWSRF agencies. Figure 24 shows that 50% of CWSRF agencies identify a need for utility training for full implementation for FSP/AMPs. Survey results for DWSRF agencies are presented in Appendix 4.

Figure 23. CWSRF agency responses to anticipated future changes in Fiscal Sustainability Plan requirements (n=34)

65%

6%

9%

3%

0%

15%

9%

0% 20% 40% 60% 80% 100%

None

Extend to full system

Extend to DWSRF

Additional FSP components

ISO55000 alignment

Other

No response

Figure 24. CWSRF program responses to apparent need for training of utilities to fully implement Fiscal Sustainability Plans (n=34)

Yes50%

No41%

No response9%

0% 20% 40% 60% 80% 100%

CWSRF


CONCLUSIONS

The following conclusions are drawn from the survey results, and informed by the AWWA AMC subcommittee members’ experience.

• The response rate from CWSRF and DWSRF agencies in the 50 states, plus Puerto Rico wasapproximately 82.4%, or 43 CWSRF agencies and 41 DWSRF agencies. Of the 43 AWSRFagencies, 34 (79%) have implemented a requirement for FSPs; and 7 (17%) of the 41 respondingDWSRF agencies have implemented a requirement for FSPs or similar asset management plans.

• The percentage of DWSRF agencies with FSP/AMP requirements is low relative to CWSRFagencies. This suggests that adoption of FSP/AMP requirements by CWSRF agencies has beenaccelerated by the mandate in WRRDA.

• The states that have implemented a requirement for FSPs/AMPs for their DWSRF programs havedone so because of state-specific objectives to improve water utility asset managementpractices.

• The sample size of DWSRF programs with FSP/AMP requirements is very small (7 states), thusthe statistical results should not to be relied on to draw conclusions about FSP/AMPrequirements of DWSRF agencies.

• Very few of the CWSRF and DWSRF agencies reported varying requirements for FSPs/AMPsbased on the size of the utility or population served.

• 60% of the CWSRF agencies require the FSP/AMP to cover solely the project for which funds aresought, rather than the full system.

• CWSRF agencies reported that FSP requirements most commonly include the following AMPcomponents: condition assessment (79%); asset inventory (76%), maintenance plan (71%);replacement cost (65%); remaining service life (56%); and replacement strategies (56%). Lesscommon components include: criticality (44%); financial strategy (41%); rehab and CAPEX/OPEXforecast (35%/32%); risk (26%); and implementation plan (24%).

• Most states relied on the USEPA as a source of information and guidance for the design of theFSP requirements, followed by examples of programs developed by other states.

• CWSRF and DWSRF agencies consulted with a range of stakeholders as they developed theFSP/AMP requirements for their funding programs. Stakeholders included utilities, professionalorganizations such as AWWA and others, consulting engineers working for utilities, USEPAregional representatives, and other state agencies.

• WRRDA establishes that to be eligible for a CWSRF loan, a utility must develop a FSP and submitcertification that such plan has been completed. Only 79% of the CWSRF agencies requiresubmittal of certification, while the rest (7) require submittal of the FSP document along withcertification. Only 4 (of those 7) CWSRF agencies formally review the documents submitted.

• 71% of the CWSRF agencies reported no follow-up after submittal.• A large majority of the CWSRF (85%) reported that they provide guidance to utilities on the FSP

requirements.


• 38% of CWSRF agencies facilitate access to asset management tools (USEPA Check-up Programfor Small Systems (CUPSS), TMF checklists, EUM checklists, worksheets, access to RCAP, andlinks to external vendors).

• Few (21%) CWSRF agencies reported that they engage in partnerships with other organizationsfor utility training and support of FSP/AMP development.

• The most common (76%) form of financial support provided by CWSRF agencies for FSP/AMPdevelopment is loans. 24% of CWSRF agencies reported that grants are available.

• CWSRF agencies were most often not aware of asset management-related policies orrequirements of other agencies in their state.

• 50% of CWSRF agencies reported that there is a need for additional training for utilities toimplement effective FSPs/AMPs.

• Asset management practices are more developed in the states where they were initiated inresponse to a recognized need. Examples include Hurricane Sandy, American Recovery andReinvestment Act (ARRA), and widespread asset failures after storms. A need was recognizedbecause of asset damage or failure due to weather-related events, or deterioratedinfrastructure required rehabilitation or replacement in areas facing severe economicchallenges. States where asset management is advancing are employing a mix or transition ofvoluntary measures, incentives, and legislation.

• Some states reported positive benefits of early local, rather than distant, successes to point toas an effective incentive for other utilities to adopt FSPs/AMPs. In some instances, early fundingor direct support led to these local success stories which were then used to build buy-in forgreater participation and more comprehensive FSP/AMP goals

• One state (Michigan) provides its utilities substantial grant opportunities to formulate assetmanagement plans. Levels of Michigan grant funding for asset management planning appear tobe unique and far greater than in any other state.

• Per interviewed agency staff, there are significant training needs; many utilities have notinitiated any kind of formal asset management practice and do not know how to begin, orrequire basic assistance with system mapping and other tasks as part of asset management plandevelopment

• Agencies engaged with small utilities note that such utilities have limited trained staff andgenerally struggle to dedicate funds to develop staff proficiency, or to pay for consultants toprovide assistance.

• Per interviewed agencies, partnerships with organizations such as EFC, NRWA, RCAP, AWWA arean important component of training and support for utilities, and have been utilized by someCWSRF and DWSRF agencies

• SRF programs administered by the various primacy agencies only reach a subset of publicutilities. Thus, by themselves SRF programs are not comprehensive as a mechanism forpromoting adoption of advanced asset management practices by all utilities in a state.

• State agencies generally report limited staff and resources, which limits their capacity toadminister robust program requirements for FSPs/AMPs. That staff need training as well. Thereare many competing demands for available agency resources. Thus, initial FSP/AMP


requirements are very basic. Meaningful review of FSPs/AMPs by agencies, and follow-up on implementation will require additional resources.

• There is overlap between the asset management-related requirements of multiple regulatoryand funding programs: NPDES, water loss/water audits, disadvantaged communities, combinedsewer systems, long-term control plans, utility planning requirements, sanitary surveys, andcapacity development expressed as technical, managerial, financial (TMF) capacity. To theextent possible and practical, harmonization of similar requirements would reduce managementand reporting burdens on utilities. Some states are already attempting this.

• Many agencies set aside funds for training and other program support. In states where set-asides are not fully utilized there is an opportunity to provide additional support to utilitiesdirectly or through partner organizations

• Stakeholder involvement in development of asset management requirements has been limitedto date.

• Very limited state-level data is available. This will hamper efforts to make policy decisions,identify realistic state-level investment needs, and demonstrate the long-term cost benefits ofasset management.

• Some states have very good asset management resources which can be shared by other states.Many states have taken advantage of this, but there appears to be greater opportunity forsharing across state boundaries and within USEPA regions.


RECOMMENDATIONS

The following are recommendations offered for SRF agencies and utilities.

• Implementation of asset management in Michigan should be studied to evaluate the costs andbenefits of grant funding to accelerate adoption of asset management by utilities.

• Additional training and technical assistance for utilities is required.• Additional support is required for small utilities with limited trained staff and financial

resources. In many cases, assistance with system mapping and other basic tasks is required,before asset management can be undertaken.

• Partnerships with organizations such as EFC, NRWA, RCAP, AWWA are encouraged as acomponent of successful training and support for utilities.

• Coordination by SRF agencies with other funding agencies is recommended to ensure that FSP/AMP requirements in SRF programs do not cause utilities to seek other sources of funding.

• Consideration of resources required to ensure effective implementation of FSPs/AMPs isrecommended. Effective implementation will require meaningful review of FSP/AMPs byagencies, and follow up on implementation.

• It is recommended that to the extent possible, asset management-related requirements ofmultiple regulatory and funding programs be aligned to minimize the management andreporting burden on utilities. Programs may include NPDES, water loss/water audits,disadvantaged communities, combined sewer systems, long-term control plans, utility planningrequirements, sanitary surveys, capacity development (TMF).

• It is recommended that in states where allowed SRF program set-asides are currently not fullyutilized, states consider opportunities to provide additional FSP/AMP training and technicalsupport to utilities directly or through partner organizations.

• It is recommended that all appropriate stakeholders be engaged as FSP/AMP requirements arefurther developed, to establish achievable requirements and timelines for implementation ofasset management plans, and to identify adequate training and funding needs.

• It is recommended that the collection and availability of state-level data be reviewed andaugmented as appropriate to inform policy decisions, identify realistic state-level investmentneeds, and demonstrate the long-term cost benefits of asset management.

• It is recommended that awareness and availability of asset management resources beenhanced, to enable agencies that are in the early stages of FSP/AMP to take advantage ofexcellent guidelines and tools already developed by some agencies.


RESOURCES

AWWA Asset Management Resource Page https://www.awwa.org/resources-tools/water-knowledge/asset-management.aspx

Establishing the Level of Progress in Utility Asset Management Survey Results (2015) https://www.awwa.org/Portals/0/files/resources/water%20knowledge/rc%20asset%20management/Level%20of%20Progress%20in%20Utility%20Asset%20Management%20v4.0.pdf

AWWA Manuals of Water Supply Practices https://www.awwa.org/publications/manuals-of-practice.aspx

AWWA Standards https://www.awwa.org/publications/standards.aspx

AWWA Annual Conference & Exposition, annually in June https://www.awwa.org/conferences-education/conferences/annual-conference.aspx

AWWA Water Infrastructure Conference& Exposition, annually in October https://www.awwa.org/conferences-education/conferences/water-infrastructure.aspx

AWWA/WEF Utility Management Conference, annually in February https://www.awwa.org/conferences-education/conferences/utility-management.aspx

Effective Utility Management Collaborative Effort https://www.awwa.org/resources-tools/water-and-wastewater-utility-management/effective-utility-management.aspx

Water Resources Reform and Development Act (WRRDA) Guidance for the Clean Water State Revolving Fund (CWSRF) https://www.epa.gov/cwsrf/water-resources-reform-and-development-act-wrrda-guidance-clean-water-state-revolving-fund

USEPA Clean Water State Revolving Fund (CWSRF) https://www.epa.gov/cwsrf

USEPA Drinking Water State Revolving Fund (DWSRF) https://www.epa.gov/drinkingwatersrf

USEPA Asset Management for Water and Wastewater Utilities https://www.epa.gov/sustainable-water-infrastructure/asset-management-water-and-wastewater-utilities

USEPA Asset Management Resources for Small Drinking Water Systems https://www.epa.gov/dwcapacity/asset-management-resources-small-drinking-water-systems-0

Sustainable Infrastructure Management Program Learning Environment (SIMPLE) http://simple.werf.org/

https://www.awwa.org/resources-tools/water-knowledge/asset-management.aspx

https://www.awwa.org/resources-tools/water-knowledge/asset-management.aspx

https://www.awwa.org/Portals/0/files/resources/water%20knowledge/rc%20asset%20management/Level%20of%20Progress%20in%20Utility%20Asset%20Management%20v4.0.pdf

https://www.awwa.org/Portals/0/files/resources/water%20knowledge/rc%20asset%20management/Level%20of%20Progress%20in%20Utility%20Asset%20Management%20v4.0.pdf

https://www.awwa.org/publications/manuals-of-practice.aspx

https://www.awwa.org/publications/manuals-of-practice.aspx

https://www.awwa.org/publications/standards.aspx

https://www.awwa.org/conferences-education/conferences/annual-conference.aspx

https://www.awwa.org/conferences-education/conferences/annual-conference.aspx

https://www.awwa.org/conferences-education/conferences/water-infrastructure.aspx

https://www.awwa.org/conferences-education/conferences/utility-management.aspx

https://www.awwa.org/resources-tools/water-and-wastewater-utility-management/effective-utility-management.aspx

https://www.awwa.org/resources-tools/water-and-wastewater-utility-management/effective-utility-management.aspx

https://www.epa.gov/cwsrf/water-resources-reform-and-development-act-wrrda-guidance-clean-water-state-revolving-fund

https://www.epa.gov/cwsrf/water-resources-reform-and-development-act-wrrda-guidance-clean-water-state-revolving-fund

https://www.epa.gov/cwsrf

https://www.epa.gov/drinkingwatersrf

https://www.epa.gov/sustainable-water-infrastructure/asset-management-water-and-wastewater-utilities

https://www.epa.gov/sustainable-water-infrastructure/asset-management-water-and-wastewater-utilities

https://www.epa.gov/dwcapacity/asset-management-resources-small-drinking-water-systems-0

http://simple.werf.org/


APPENDIX 1: Excerpts from Water Resources Reform and Development Act (WRRDA) of 2014




APPENDIX 2: Responding SRF Agencies by State

State CWSRF DWSRF State CWSRF DWSRF AK NC AL ND AR NE AZ NH CA NJ CO NM (1) CT NV DE NY FL OH GA OK HI OR IA PA ID PR IL RI IN SC KS SD (1) (1) KY TN LA TX

MA UT MD VA ME VT (1) MI WA MN WI MO WV MS WY MT Totals 43 41

Note (1): limited response


APPENDIX 3: 2016 Survey of State Revolving Fund Program Implementation of Asset Management Requirements

Introduction to Survey

The Asset Management Committee (AMC) of the American Water Works Association (AWWA) is conducting this survey of State Revolving Fund (SRF) agencies to better understand plans to implement asset management requirements for utilities, such as those integral to the Fiscal Sustainability Plans (FSP) required for Clean Water State Revolving Fund (CWSRF) programs by the 2014 Water Resources Reform and Development Act (WRRDA). Many of the water and wastewater utility professionals that will prepare FSPs are AWWA members. The mission of the AWWA Asset Management Committee is to promote proactive and cost effective management of utility assets. The AMC’s interest in conducting this survey is to better understand how requirements for FSPs are being implemented and what support our AWWA members may require to help ensure the success of this effort.

In this survey, the terms Fiscal Sustainability Plan and Asset Management refer to the following:

• Fiscal Sustainability Plan (FSP) – a plan required by the 2014 WRRDA, which includes an inventory of critical assets; evaluation of the condition and performance of assets; certification that water and energy conservation efforts have been evaluated and will be implemented; and a plan for maintaining, repairing, and replacing assets as necessary.

• Asset management - a set of practices used to provide the service level required by utility customers at the lowest long-term cost and acceptable level of risk. Practices include inventory of assets, assessment of asset condition, performance and risk, and risk-based planning to optimize maintenance, renewal and replacement of assets. Asset management is an integral component of a Fiscal Sustainability Plan.

Because the WRRDA only requires FSPs for CWSRF programs, many states have different requirements for their Drinking Water State Revolving Fund (DWSRF) programs. To help us understand the different requirements, we request that the survey be completed separately for CWSRF and DWSRF agencies. The survey covers the following general topic areas:

• General information • Applicability • Fiscal Sustainability Plan requirements • Implementation of requirement • Consequence for utilities • Tools, Training, and Support • Data and benchmarking • Future needs and plans

All data collected through this survey will be aggregated and presented in a manner that does not identify individual state agencies. If best practices are identified, the AMC may formally request specific permission to highlight aspects of individual programs. State-specific information will only be presented with explicit permission of the appropriate state officials.


Your participation is greatly appreciated. The estimated time required to complete the survey is 15-20 minutes. It is our goal to use the results of this survey to support the successful implementation of asset management plans by utilities. The aggregated results will be provided to all survey participants.

Survey questions and responses

Section 1: General information

1. General Information (Fill in the box) a. State b. Name c. Title/Position

2. Which State Revolving Fund (SRF) program does this survey pertain to? (select one) a. Clean Water State Revolving Fund (CWSRF) b. Drinking Water State Revolving Fund (DWSRF)

3. Is development of a Fiscal Sustainability Plan (FSP) in some form currently required in order to receive funding for construction through the State Revolving Fund (SRF) program that is the subject of this survey? ***If the answer to this question is ‘Yes’ – nothing happens. If the answer is ‘No’, the survey bumps the participant to Question 19***

a. Yes. b. No.

Section 2: Applicability

4. Do the requirements for Fiscal Sustainability Plans (FSP) for this program vary by size of utility? ***If the answer to this question is ‘Yes’ – nothing happens. If the answer is ‘No’, the survey bumps the participant to Section 3.***

a. Yes b. No

5. How do the requirements vary? (select all that apply) a. Phased timing of requirements based on size of utility b. Different technical requirements based on size of utility c. Other (please specify)

6. What criteria are used for determining requirements? (select all that apply) a. Population served b. Number of connections c. System flow capacity d. Other (please specify)

Section 3: Fiscal Sustainability Plan requirements

7. For this program, a Fiscal Sustainability Plan (FSP) is required for (select one): a. the full utility system (all assets), b. all assets associated with the part of the system the project involves (e.g. collection,

treatment), or


c. only the specific assets included in the candidate project for SRF-funding 8. What components are required in the Fiscal Sustainability Plan (FSP)? (select all that apply)

a. Asset inventory/hierarchy b. Remaining service life c. Condition assessment/likelihood of failure d. Criticality e. Risk f. Replacement cost g. Maintenance plan h. Rehabilitation and replacement strategies i. Forecast of rehabilitation and replacement capital costs (CAPEX plan) j. Forecast of operations and maintenance costs (OPEX plan) k. Financial strategy l. Implementation plan for financial strategy m. Other (please specify)

9. What sources of information or assistance were relied upon to establish Fiscal Sustainability Plan (FSP) requirements for this program? (select all that apply)

a. United States Environmental Protection Agency (USEPA) b. Other State Revolving Fund programs c. International Infrastructure Management Manual (IIMM) d. International Organization for Standardization (ISO) e. Institute of Asset Management (IAM) f. Sustainable Infrastructure Management Program Learning Environment (SIMPLE-WERF) g. Other (please specify)

10. What stakeholders were included in the development of the state’s Fiscal Sustainability Plan (FSP) requirements? (select all that apply)

a. Large and medium utilities (serves >10,000 population) b. Small utilities (serves <10,000 population) c. Professional organizations d. USEPA regional representative e. Other (please specify)

Section 4: Implementation of requirement

11. What type of submittal is required for this program? a. Certification of Fiscal Sustainability Plan (FSP) development, but submittal of the FSP

document is not required. b. Fiscal Sustainability Plan (FSP) document

12. Who must certify the submittal? (check all that apply) a. Professional Engineer (PE) b. Licensed utility operator c. Mayor


d. Authorized signatory of Council or Board of Works e. Utility director f. Certified Public Accountant (CPA) g. Other (please specify)

13. At what point in the SRF-funded project is the submittal required? a. With application b. Before loan closing c. Before final loan disbursement d. Other (please specify)

14. If the state requires submittal of Fiscal Sustainability Plans (FSPs) for this program, are they formally reviewed by the state?

a. No b. Yes – please describe: Who reviews the FSP, What criteria are used for review of the FSP

content, and upon review of FSPs are they approved or rejected based on satisfying FSP criteria or acknowledged as reviewed?

15. Are there follow-up requirements after the initial submission of the Fiscal Sustainability Plan (FSP)? (select all that apply)

a. No. b. Yes, regular reporting is required. c. Yes, eligibility for future SRF funding is dependent on FSP implementation. d. Yes, other (please specify)

Section 5: Consequence for utilities

16. How are Fiscal Sustainability Plans (FSPs) considered in the selection of projects for funding under this program? (select all that apply)

a. Requirement for funding eligibility b. Points awarded toward project selection or ranking c. Interest rate reduction d. Principal reduction e. Other (please specify)

17. Do loans include Fiscal Sustainability Plan (FSP) -related terms or conditions? (select all that apply)

a. No b. Yes, terms and conditions require FSP submittal c. Yes, terms and conditions require FSP implementation d. Yes, other (please specify)

Section 6: Tools, Training & Support

18. Does the state provide guidance on this program’s Fiscal Sustainability Plan (FSP) requirement to utilities?

a. No


b. Yes 19. Is Fiscal Sustainability Plan (FSP) -related guidance available on the state’s website? (select all

that apply) a. No b. Yes, guidelines are available. c. Yes, training materials are available. d. Yes, sample plans are available. e. Yes, external resources are available. f. Yes, other (please specify)

20. Does the state facilitate access to asset management tools such as software, templates, or guides?

a. No b. Yes (please describe)

21. Does the state partner with other organizations to provide Fiscal Sustainability Plan (FSP) -related guidance and support to utilities?

a. No b. Yes, please name the organizations and describe the type of support provided

22. Is additional Fiscal Sustainability Plan (FSP) -related support available to small utilities? (select all that apply)

a. No b. Yes, additional training c. Yes, direct assistance with FSP development d. Yes, additional funding e. Yes, other (please specify)

Section 7: Data & benchmarking

23. What state-level data is available on utility asset management needs and practices? (select all that apply)

a. Implementation / practice of asset management by utilities b. Estimates of existing utility assets (quantity, age, and/or replacement cost) c. Utility Plant in Service (UPIS) d. Planned utility investments e. Water main replacement rates f. Water main breakage rates g. Infrastructure condition scoring h. Water loss i. Other (please specify)

24. Do state regulatory agencies in your state require asset management plans for other purposes? (select all that apply)

a. Not sure. b. No.


c. Yes, public utility commission requires a plan. d. Yes, environmental regulator requires a plan. e. Yes, finance requires a plan. f. Yes, transportation requires a plan. g. Yes, parks require a plan. h. Yes, administrative services require a plan. i. Yes, other (please specify)

25. Has any state agency established and communicated standards for utility asset management practices? (select all that apply)

a. Not sure. b. No. c. Yes, modeled after USEPA. d. Yes, modeled after other states. e. Yes, modeled after the International Infrastructure Management Manual (IIMM) f. Yes, modeled after the International Standards Organization (ISO) g. Yes, modeled after the Institute of Asset Management (IAM) h. Yes, modeled after the Sustainable Infrastructure Management Program Learning

Environment (SIMPLE-WERF) h. Yes, other (please specify)

Section 8: Future needs and plans

26. Is funding support available for Fiscal Sustainability Plan (FSP) development? (select all that apply)

a. No b. Yes, through grants c. Yes, through loans

27. Are future changes in applicability & scope of Fiscal Sustainability Plan (FSP) requirements anticipated? (Select all that apply)

a. No b. Yes, requirements will be extended from the subject facility or project to the full utility

system. c. Yes, if not yet required, some form of FSP and asset management requirements will be

extended to DWSRF programs. d. Yes, additional required FSP components. e. Yes, alignment with ISO 55000, or other standards. f. Yes, other (please specify)

28. Is there an apparent need of utilities for training in order to fully implement Fiscal Sustainability Plans (FSPs)?

a. No


b. Yes, please answer the following: What training needs are anticipated, what plans for future training have been considered, and what assistance may be required to meet training needs?

On behalf of the AWWA Asset Management Committee and the AWWA members that we serve, thank you for participating in this survey. The results will be used to help AWWA determine how to best support its members in their efforts to develop effective utility asset management plans. We hope that the results will also provide SRF program managers with useful insight into the variety of ways that Fiscal Sustainability Plan requirements are being implemented across the country.


APPENDIX 4: DWSRF Survey Results

In this appendix to the report, the survey results for DWSRF agencies which have FSP/AMP requirements are presented. Because the sample size of DWSRF programs with FSP/AMP requirements is very small (7 states), the statistical results should not to be relied on to draw conclusions about FSP/AMP requirements of DWSRF agencies.

Q: Is a Fiscal Sustainability Plan required for the full utility system, part of the system, or only the specific assets included in the project that is a candidate for SRF-funding?

Q: What asset management plan components are required in the Fiscal Sustainability Plan?

Figure 26. Required asset management components of DWSRF program Fiscal Sustainability Plans (n=7)

0 1 2 3 4 5 6 7

Asset inventory

Remaining service life

Condition assessment

Criticality

Risk

Replacement cost

Maintenance plan

Rehab and replace strategies

CAPEX forecast

OPEX forecast

Financial strategy

Implementation plan

Figure 25. Scope of required DWSRF Fiscal Sustainability Plans (n=7)

All utility assets

All assets in part of system

SRF project-related assets

No response

0 1 2 3 4 5 6 7


Q: What sources of information or assistance were relied upon to establish Fiscal Sustainability Plan requirements?

Q: What stakeholders were included in the development of the Fiscal Sustainability Plan requirements?

Figure 27. Sources of information and assistance used by DWSRF agencies when developing Fiscal Sustainability Plan requirements (n=7)

0 1 2 3 4 5 6 7

USEPA

Other State

IIMM

ISO

IAM

WERF

Other

Figure 28. Stakeholders consulted by DWSRF agencies when developing Fiscal Sustainability Plan requirements (n=7)

0 1 2 3 4 5 6 7

Large & medium utilitiesSmall utilities

Prof orgs and consultantsUSEPA region rep

Other State agencyNone/no response


Q: What type of submittal is required for this program – certification only or FSP document?

Q: Who must certify the submittal?

Q: At what stage in the SRF-funded project is the submittal required?

Figure 29. DWSRF program submittal requirements for Fiscal Sustainability Plans

FSP certification only

FSP document

Other

0 1 2 3 4 5 6

Figure 30. Individuals authorized to certify DWSRF Fiscal Sustainability Plan submittals (n=7)

0 1 2 3 4 5 6 7

PEUtility Operator

MayorUtility Board

Utility DirectorCPA

Other

Figure 31. Stage at which DWSRF agencies require Fiscal Sustainability Plan submittals. (n=7)

0 1 2 3 4 5 6 7

ApplicationLoan closing

Loan disbursementOther

No response


Q: If the state requires submittal of Fiscal Sustainability Plans for this program, are they formally reviewed? If so, who reviews them? What criteria are used for review of the content? Upon review are they approved or rejected based on satisfying criteria, or acknowledged as reviewed?

As shown in Figure 29, five DWSRF agencies require submittal of FSP documents as part of the SRF program. Of these five agencies, four formally review the content of the plans. Agencies that do not formally review the content of the plans reported that they verify their completion.

Q: Are there follow-up requirements after the initial submittal of the Fiscal Sustainability Plan (FSP)?

As shown in Figure 32, 43% of the responding DWSRF agencies do not have any follow up requirements. 14% of the agencies indicated that they have follow-up reporting requirements, and 14% reported some type of follow-up on implementation. Other reported follow-up requirements for DWSRF agencies include inspection during sanitary surveys, and submittal of updated plans 5 years after initial submittal.

Q: How are Fiscal Sustainability Plans considered in the selection of projects for funding under this program?

Some of the ways in which FSPs/AMPs are considered in the selection of DWSRF projects include priority points, subsidies, and future interest rate reduction.

Figure 32. DWSRF agency follow-up requirements after initial Fiscal Sustainability Plan submittals (n=7)

0 1 2 3 4 5 6 7

None

Reporting

Implementation

Other

No response


Q: Do loans include Fiscal Sustainability Plan (FSP)-related terms or conditions?

Q: Does the state provide guidance to utilities on the SRF program’s Fiscal Sustainability Plan requirement?

Q: Is Fiscal Sustainability Plan-related guidance available on the state’s website?

Figure 33. DWSRF program Fiscal Sustainability Plan-related loan requirements (n=7)

0 1 2 3 4 5 6 7

NoneFSP submittal

FSP implementationOther

No response

Figure 35. Fiscal Sustainability Plan-related guidance on DWSRF agency website (n=7)

0 1 2 3 4 5 6 7

None

Guidelines

Training material

Sample plans

External resources

Other

No response

Figure 34. DWSRF agency provided guidance on Fiscal Sustainability Plan requirement. (n=7)

0 1 2 3 4 5 6 7

Yes

No

No response


Q: Does the state facilitate access to asset management tools such as software, templates, or guides? If so, please describe.

Q: Does the state partner with other organizations to provide Fiscal Sustainability Plan-related guidance and support to utilities? If so, which organizations and what type of support is provided?

Q: Is additional Fiscal Sustainability Plan-related support available to small utilities? If so, what type?

In Figure 38, other types of supplemental assistance provided by DWSRF agencies to smaller utilities include connection to RCAP for assistance.

Figure 36. DWSRF agency-facilitated access to software tools, templates, or guides. (n=7)

Yes No

0 1 2 3 4 5 6 7

DWSRF

Figure 37. DWSRF agency partnerships with other organizations to provide Fiscal Sustainability Plan-related guidance and support to utilities. (n=7)

Yes No

0 1 2 3 4 5 6 7

DWSRF

Figure 38. Additional support available to small utilities for DWSRF program Fiscal Sustainability Plan-related requirements (n=7)

0 1 2 3 4 5 6 7

No additional support

Additional training

Direct assistance

Additional funding

Other

No response


Q: What state-level data on utility asset management needs and practices is available?

Q: Do other state regulatory agencies in your state require asset management plans for other purposes?

Figure 39. DWSRF agency response to availability of state-level data related to utility asset management needs and practices (n=7)

0 1 2 3 4 5 6 7

Utility practice of asset mgmt

Utility assets

UPIS

Planned investments

Water main replacement

Water main breaks

Asset condition

Water loss

Other

None/no response

Figure 40. DWSRF agency responses to knowledge of other state regulatory agencies with asset management requirements (n=7)

0 1 2 3 4 5 6 7

Unsure

None

Public Utility Commission

Environment

Finance

Transportation

Parks

Adminstrative

Other

No response


Q: Has any other state agency established and communicated standards for utility asset management practices? If so, what were those standards modeled after?

Q: Is funding support available for Fiscal Sustainability Plan development?

Figure 41. DWSRF agency responses to knowledge of established and communicated standards for utility asset management and the source of the models used for their development (n=7)

0 1 2 3 4 5 6 7

Unsure

None

USEPA

Other states

IIMM

ISO

IAM

WERF

Other

No response

Figure 42. DWSRF program funding available for Fiscal Sustainability Plan development (n=7)

0 1 2 3 4 5 6 7

None

Grants

Loans

No response


Q: Are future changes in applicability & scope of Fiscal Sustainability Plan requirements anticipated? If so, what changes?

In Figure 43, other future plans reported by DWSRF agencies include related state legislation, and extending requirements to all public water systems.

Q: Is there an apparent need for utilities to receive training to fully implement Fiscal Sustainability Plans?

Figure 43. DWSRF agency responses to anticipated future changes in Fiscal Sustainability Plan requirements (n=7)

0 1 2 3 4 5 6 7

None

Extend to full system

Extend to DWSRF

Additional FSP components

ISO55000 alignment

Other

No response

Figure 44. DWSRF program responses to apparent need for training of utilities to fully implement Fiscal Sustainability Plans (n=7)

Yes No

0 1 2 3 4 5 6 7

DWSRF


APPENDIX 5: Presentations from Special Technical Session, ACE16, Chicago, IL, June 22, 2016

AWWA ACE16

1

Trends in Advancing Asset Management through Government Funding Programs

Kurt Vause, P.E.AWWU

Session Objectives:

• Results of the AWWA Asset Management Committee’s survey of State Revolving Fund program efforts

• Illinois, New Jersey, Connecticut, and Michigan programs

• Panel discussion, with audience questions and participation. – Identify common challenges, successful approaches, and

opportunities to further support and encourage utilities to improve management of their utility assets.

Introducing the Topic

• AWWA has encouraged adoption of advanced Asset Management Practices:

“….supports asset management concepts and tools at utilities as a best

practice approach to proactively and sustainably manage assets throughout their life cycle, starting with effective planning and design, continuing through operation and maintenance, and incorporating appropriate rehabilitation, replacement and asset disposal”

AWWA ACE16

2

How do others promote Asset Management?

Report on Survey of State Revolving Fund Program Implementation of Asset Management Requirements

AWWA ACE16

1

Survey of Implementation of Asset Management Requirements for State Revolving Fund and Other Programs

Dan Haddock, P.E., Env SPLochmueller Group

Water Resources Reform and Development Act (WRRDA) of 2014

Clean Water State Revolving Fund (SRF) loan recipients required to:

– Develop Fiscal Sustainability Plans (FSP’s)

– Certify that an FSP has been developed and implemented

FSP’s and Asset Management

Fiscal Sustainability Plan• Inventory of critical assets

• Evaluation of condition and performance of assets

• Plan for maintaining, repairing, or replacing assets

• Plan for funding these activities

• Certification of consideration and implementation of energy and water conservation

FSP’s and Asset Management

Fiscal Sustainability Plan• Inventory of critical assets

• Evaluation of condition and performance of assets

• Plan for maintaining, repairing, or replacing assets

• Plan for funding these activities

• Certification of consideration and implementation of energy and water conservation

Asset Management

The Survey

• FSP/Asset Management requirements of SRF program

• Broader state efforts to promote Asset Management

• Stakeholder involvement

• Training and other assistance

• Challenges & Successes

• Future directions

Our Goals

• Understand different ways that States are promoting Asset Management

• Understand how to better support utilities in their efforts to improve asset management

• Present AWWA and Asset Management Committee members as an information resource for States

AWWA ACE16

2

Participation

Both One Neither

Participation

Both One Neither

78% complete & nearly complete responses

FSP required to access SRF?

No21%

Yes79%

No83%

Yes17%

Clean Water

Drinking Water

FSP requirements

0% 20% 40% 60% 80% 100%

Asset inventoryRemaining service lifeCondition assessment

CriticalityRisk

Replacement costMaintenance plan

Rehab and replace strategiesCAPEX forecastOPEX forecast

Financial strategyImplementation plan

Clean Water (CWSRF)

n = 34

FSP requirements

0% 20% 40% 60% 80% 100%

Asset inventoryRemaining service lifeCondition assessment

CriticalityRisk

Replacement costMaintenance plan

Rehab and replace strategiesCAPEX forecastOPEX forecast

Financial strategyImplementation plan

n = 7

Drinking Water (DWSRF)

Scope

18%

18%59%

86%

14%

DWSRFCWSRF

AWWA ACE16

3

Various incentives

• Requirement for SRF funding

• Points awarded toward project priority

• Principal forgiveness

• Future interest rate adjustment based on implementation

Additional support for small utilities

0% 20% 40% 60% 80% 100%

Additional training

Direct assistance

Additional funding

0% 20% 40% 60% 80% 100%

Additional training

Direct assistance

Additional funding

DWSRF

CWSRF

n = 34

n = 7

Stakeholders consulted

0% 20% 40% 60% 80% 100%

Large and medium utilitiesSmall utilities

Professional orgs and eng consultantsUSEPA regional representative

Other State agency

0% 20% 40% 60% 80% 100%

Large and medium utilitiesSmall utilities

Professional orgs and eng consultantsUSEPA regional representative

Other State agency

DWSRF

CWSRF

n = 34

n = 7

Scarce information

0% 20% 40% 60% 80% 100%

Utility asset managementEstimates of existing utility assets

Utility Plant in Service (UPIS)Planned utility investments

Infrastructure condition scoring

0% 20% 40% 60% 80% 100%

Utility asset managementEstimates of existing utility assets

Utility Plant in Service (UPIS)Planned utility investments

Water main replacement ratesWater main breakage rates

Infrastructure condition scoringWater loss

n = 34

n = 7

DWSRF

CWSRF

Interesting issues

• Coordination with other programs related to Asset Management– NPDES, water loss, disadvantaged

communities, combined sewer systems, long term control plans, utility planning, sanitary surveys, capacity development (TMF)

• Engaging stakeholders, convincing utilities of benefits

Interesting issues

• Approaches – legislative, voluntary, incentives

• Training needs and approaches (partnerships)

• Agency resource constraints

• Challenges faced by small systems

AWWA ACE16

4

Presenters & Panelists

• Illinois: Gary Bingenheimer

• New Jersey: Dan Kennedy

• Connecticut: Julie Silva

• Michigan: Bob Schneider

• Environmental Finance Center: Heather Himmelberger

Panel Discussion

AWWA ACE16

1

Illinois EPA SRF Loan ProgramsUsing Set Aside Funds for Asset Management Activities

Gary BingenheimerIllinois Environmental Protection Agency

Illinois EPA SRF Loan Programs

• SRF Loan Programs annually receive a federal capitalization grant (cap grant) from USEPA

• DWSRF programs may use portions of their cap grant to provide direct program assistance in the form of grants, technical assistance to small systems and other types of expenditures through “set-asides”.

• Set-aside activities must coordinate with the overall goals of the DWSRF


• Four types of set-asides authorized

– DWSRF program administration

– Technical assistance to small systems

– State program management support

– Local assistance & support for other state programs


• % of grant and required state match per set-aside

– DWSRF program administration (4%) No match

– Technical assistance to small systems (2%) No match

– State program management support (10%) 1 : 1

– Local assistance & support for other state programs

• (15%) No match


• IEPA’s use of 2014 cap grant set-aside funds

• Submit a “work plan” to USEPA detailing the level of funds to be allocated for each set-aside along with the planned activities, goals and objectives for each set-aside

• USEPA must approve the work plan and IEPA reports to USEPA on activity and use of funds


• IEPA use of 2014 cap grant set-aside funds

– Technical Assistance to Small Systems

– allocated $85,000

– Local Assistance and Other Authorized Activity

– allocated $85,000

– “Activity” - Provide FREE training on the basics of water loss control auditing and gaining a better understanding of their water system.

– Training based on the AWWA M36 Water Audits and Loss Control manual

AWWA ACE16

2


• IEPA entered into an intergovernmental agreement with Southern Illinois University at Edwardsville’s Environmental Research & Training Center (ERTC)

• ERTC contracted with Illinois AWWA and Illinois Rural Water Association to conduct one day training workshops

• Planned up to 40 one-day training workshops across the state - FREE


• Budget - $170,000

• “Cost” per attendee - $150 – Max of 2 attendees per water system

– FREE to water system representatives

• Focus of Workshops– Water Loss Audit Training

• Based on AWWA M-36 Water Audit and Loss Control Manual

• Morning lecture / Afternoon hands on training


Water Loss Audit Training

• Morning lecture based on a PowerPoint presentation on benefits of a water loss audit and intro to the water loss audit software

• Participants asked to bring a laptop loaded with the free software and some of their own system information

• Afternoon session provides a hand on demonstration of the software using their own system information


• Water Loss Audit Training Results• Approximately 30 workshops conducted

• Almost 600 Participants

• Average of 20 participants per workshop

• Suggestions for future training • Break training into two half day sessions

• Offer training via a webinar

• Training on Excel – Basic Excel knowledge necessary

• Build on training offered – more advanced session

• Build on training offered – implementing solutions


• Successes– Reached 88 small (less than 10,000) water systems

– Introduced almost 600 water system personnel to water loss audit methodologies and AWWA M-36 software tool

• Challenges– Who will provide training

– Logistics – locations/sign up/staffing

• Future Plans– Future cap grant set-aside funds available

– Work plan development for encouraging and assisting with asset management activities under consideration


• Questions?

• Gary Bingenheimer

Illinois Environmental Protection Agency

Infrastructure Financial Assistance Section

217-785-2027

[email protected]

AWWA ACE16

1

NJDEP’s Efforts To Promote Utility Asset Management

Daniel KennedyAssistant Commissioner of Water Resources ManagementNew Jersey Department of Environmental Protection

New Jersey’s picture

• Industrial history & population density & intensive land use

= Legacy of pollution

• 564 municipalities & strong local rule

• Ownership and operation of PCWS (586):– Public:

• Municipal (252)

• Utility authorities (44)

• State/ Federal (military bases) (14)

– Private:• Investor-owned/ water companies (80)

• Institutions/ other (196)

New Jersey’s picture

• New Jersey regulates: – 586 Public Community Water Systems (PCWS)

– Close to 10,500 NJPDES permittees

• Dramatic range of PCWS service size:– 75% systems “very small”

– Yet, less than 5% of all PCWS serve almost half of New Jersey’s population

• Over $8 billion in drinking water infrastructure investment is needed over the next 20 years

Evolution of Asset Management

DEP discussions with Clean

Water Council-NJ on asset management

2008

2000-2010

National promotion of water

infrastructure asset management

And CWC Recommendations

Superstorm Sandy

2012

2013

DEP Asset Management

and other resiliency guidance

SRF WRRDA requirements:

fiscal sustainability plan (asset

management)

2014

2020

Where do we want to be? •Long term investment strategies

•Asset management plans in place and being implemented

Challenges

• Understanding of the status of AM amongst State water utilities

• Assuring that financial resources are directed towards AM

• Utilities’ concern of balancing regulatory compliance with expectations rate payers, investors and boards

• DEP capabilities to assess compliance

• Competing regulatory mandates

Goals for New Jersey’ Asset Management Program

• Incremental progress in utilities’ implementation of asset management

• Providing metrics and guidance that will assist owners and operators in developing and implementing asset management

• Transition from guidance to requirements

AWWA ACE16

2

Collaborative Effort

• Internal cross-program collaboration– Regulatory water programs

– Environmental Infrastructure Trust (NJEIT)

– Compliance & enforcement program

• External support and advisement: Industry workgroup (AWWA-NJ, NJWEA, AEA-NJ, NJWA)– Informed original Best Practices document

– Helped develop a baseline survey of the water industry & review results

– Advising on Technical Guidance document

– Will help determine best strategy for roll-out of requirements

Current Requirements & Support

• Combined Sewer Outfall (CSO) permit requirement– Provided an Assessment Guide for review of AM

Plans

• MOAs with some community drinking water systems – Reviewed and provided feedback on a few of the

community drinking water systems’ AM plans

• Asset Management Guidance and Best Practices

• AMP certification requirement for receiving EIFP loans

• AM plan costs can be financed under the EIFP

• Education and outreach

Baseline Survey• Purpose: Assess status of asset management

planning amongst State drinking water and wastewater utilities

• Designed with assistance from industry associations, including AWWA-NJ

• What was asked:• Assets inventoried?

Mapped?• Condition assessment

of more than 50%?

• Criticality assessment?• Long-term funding strategy?• Intent to complete

Who We Heard From

L…Medi…

S…

181 Wastewater Systems

L…

Medi…

S…

362 Drinking Water Systems

Inventory

$1,000 or greater38%



$500 or greater1%

All Assets15%

Critical/Vulnerable28%

What is being inventoried

Of 362 Drinking Water Systems:

•69% have done some inventorying

•Of those, 87% have inventoried more than half of their assets

Mapping76% have mapped >50% assets

• 73% of treatment & 78% of distribution systems

AWWA ACE16

3

N…Y…

47 MEDIUMSYSTEMS

53% have done criticality assessment, 47% have not

Drinking Water Systems (251)

N…Y…

54 SMALLSYSTEMS

N…Y…

150 LARGESYSTEMS

Asset Assessment

71%: condition assessment of more than 1/2 of inventoried assets

No

Ye

54 SMALL SYSTEMS

N…

Y…

47 MEDIUMSYSTEMS

No

Ye

150 LARGESYSTEMS

Intent to Complete (for Drinking Water Systems)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

INVENTORY MAPPING CONDITION CRITICALITY

Completed In Progress 6-12 months 1-3 years 4-6 years 7+ years

What’s New & Next

• Website with resources, links, and our program status – Including AMP checklist and technical

guidance

• Determining requirements, reasonable implementation schedules, and roll-out:– Who is first?

– By when?

Proposed Rollout

• Phased: Large, critical, vulnerable, problem

• Pilot first to access capability and determine resources needed

• As determined by utility-specified work plans, components of the AMP would be done in phases

AWWA ACE16

1

ASSET MANAGEMENT INITIATIVES IN CONNECTICUTJulie SilvaConnecticut Department of Public Health

• 2.9 million CT residents served – 3.6 million total

population

• 2,488 public water systems– 1,968 non-community

systems

– 520 community systems

• 332 small community(under 1,000)

Drinking Water Section Responsibilities

Outline

• Challenges

• Current Initiatives

• Success Stories

• Future Initiatives

Extreme Weather

• Three storms in 2011 and 2012– Hundreds of boil water advisories

– Over 50% of small systems negatively affected

• Multiple failing systems

• Three Storm Strategy– Training

– Regulations

– Funding

– Technical assistance

• June 2015

• Small system in southeastern CT

• 50-year old hydropneumatic tank

• Aged and spot welded

• Under normal operating pressure

Tank Explosion

AWWA ACE16

2

Tank Explosion

PA 14-98

• $30 million in state bond funds to subsidize DWSRF loans

• Small systems up to 50% subsidy

• Larger systems up to 30% subsidy

• Not-for-profit systems

• Asset Management Plans (AMP) and Fiscal Management Plans (FMP)

• Not yet approved by State Bond Commission

Outline

• Challenges


• Success Stories


• Emergency Power Generator Program– Generators under

$100,000

– 45% subsidy new generators

– 25% subsidy replacement

– Streamlined SRF Requirements

• Federal subsidy– 10% small system

– 20% small system approved Asset Management Plan

– Variable large and medium system subsidy for projects that serve distressed communities

DWSRF Incentives

PA 14-98 AMP and FMP Implementation

• Develop guidelines for plans

• EPA Reference Guide for Asset Management

• EPA STEP and Best Practices guides

• Surveyed DWSRF borrowers– System buy-in

• Work with asset management experts within CT

AM and FM Checklists

AWWA ACE16

3

AM and FM Checklists

• Asset Management Checklist– http://www.ct.gov/dph/lib/dph/drinking_water/p

df/FM_Checklist.pdf

• Fiscal Management Checklist– http://www.ct.gov/dph/lib/dph/drinking_water/p

df/FM_Checklist.pdf

• Links to EPA Publications– Check-Up Program For Small Systems

Technical Assistance Contractor

• RCAP Solutions

• 3 year initiative, began Summer 2015

• Free Technical Assistance– Develop Asset and Fiscal Management Plans

– Hold training events

– Promote Check-Up Program for Small Systems

– Up to 8 systems per year

Outline

• Challenges


• Success Stories


• Population: 1,477

• 330,000 gallon tank replacement

• Anticipate $1.5 million DWSRF loan

• RCAP

Tariffville Water Commission

Tariffville Water Commission

200

250

300

350

400

450

500

550

600

650

Ave

rag

e C

ost

/H

ou

seh

old

($)

Rate Projections

CT Average

Pre-AMP/FMP

Post-FMP/AMP

Increases atInflation

Model assumes inflation at 2%/year

• Population: 7,300 • 2011 EPA Effective

Utility Management Assessment

• RCAP• ArcGIS Asset

Management Tool BETA Group, Inc

• 2016 CT Small Community Public Health Drinking Water Merit Award

Town of Putnam

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Town of Putnam

Outline

• Challenges


• Success Stories


Capacity Assessment Tool

• 332 small community systems

• Collection of technical, managerial, and financial information

Scorecard MapRed: Total Score < 40Yellow: Total Score 40-69Green: Total Score >=70

Total Scores out of 100

Regional Water Supply Planning

• Complete statewide water supply plan– CGS Section 25-33c

• Water Utility Coordinating Committees– CGS Section 25-33d to 33j

• System assessment and consolidation will use Capacity Assessment Tool information

Aging Infrastructure Legislation

• Small Systems– Under 10,000

• Fiscal and Asset Plans– Rehabilitation or replacement plans

– Hydropneumatic tanks initial priority• Plan by July 1, 2017

– Complete plans by January 1, 2019

– Annual Updates

• Hopeful for next legislative session

Julie Silva

Sanitary EngineerConnecticut Department of Public Health

Drinking Water Section

[email protected]

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Michigan Asset Management InitiativesBob SchneiderMichigan Department of Environmental Quality

Michigan DEQ structure

• Revolving Loan Section responsible for DWRF and SRF loans and the SAW program

• Community Water Supply Program responsible for public water supplies and their technical capacity (sanitary surveys)

• Water Resources Division protects and monitors Michigan’s waters (NPDES )

• Revolving Loan Section assists water and wastewater district staff thru financial and managerial capacity reviews

Sanitary Survey Requirements

• R 325.11606. Publicly owned or operated community water supplies; additional general plan requirements.

• Rule 1606. (1) The general plan for a waterworks system that is publicly owned or operated shall include a capital improvements plan that identifies water system needs for 5-year and 20-year planning periods. A publicly owned or operated community water supply that existed before the effective date of this rule is not required to comply with this sub rule until January 1, 2016.

Community Water

SuppliesPublicly Owned CWS Privately Owned CWS

Serving >1,000 <=1,000 >1,000 <=1,000

Rule 1606Capital

Improvements Plan

CIP developed by 1/1/2016CIP developed

by 1/1/2018n/a

Rule 1606 Asset

ManagementProgram

AMP developed by 1/1/2018

n/aAMP developed

by 1/1/2018n/a

Community Water SupplyAsset Management

Rule 1606 requirements

• A summary detailing the system used to maintain an inventory of assets.

• A summary describing the method used to assess the criticality of assets considering the likelihood and consequence of failure.

• A statement of level of service goals.

• A capital improvements plan that identifies waterworks system needs for 5-year and 20-year planning periods.

• A summary detailing the funding structure and rate methodology that provides sufficient resources to implement the asset management program.

AM Provision in Permits

• Governor’s October 2011 Infrastructure Message highlighted the importance of AM for sewer and water utilities

• Started in FY2012, adding AM program requirements to all reissued major municipal WWTP permits

• First up: Detroit Water and Sewerage Department (DWSD) – Current Draft Permit Includes AM Provision

• Then: All Major Municipals reissued in FY13 and the remainder over the next cycle (5 years)

• After that: “Significant” Municipal Minors

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State Regulations

• Part 41 – Rule 55(1)– Sewerage systems shall be operated and

maintained at all times as efficiently as possible ina manner which minimizes discharges ofexcessive pollutants.

• NPDES Permits – Part II.D.3, FacilitiesOperation– The permittee shall, at all times, operate and

maintain all treatment or control facilities orsystems installed or used by the permittee toachieve compliance with the terms and conditionsof this permit…

Asset Management Plan A schedule for development and implementation of an AM Program

Asset Management Program 1. Asset Inventory

2. Critical Assets

3. Level of Service

4. O&M Strategies

5. Capital Improvement PlanPermit Language Requires an AM Program to address: Staffing, Mapping Collection System, Inventory and Assessment of Fixed Assets, Budget and Rate Sufficiency, Annual Report

Storwater Asset Management and Wastewater (SAW)

• The Great Lakes Water Quality Bond 2002 provided $1B for sewer projects

• Public Act 562 of 2012 authorized $450M for Stormwater, Asset Management Wastewater or SAW program

• Grants are available up to $2M per municipality

• Applications were accepted starting Dec 2, 2013 on a first come first served basis.

• On December 2, 2013 673 applications totaling $541M were received.

• Lottery drew 590 winners for the $450M

SAW status

• First Round – $77M (FY14)– 92 grants awarded

• Second Round - $91M (FY15)– 115 grants awarded

• Third Round - $100M (FY16)– 134 grants awarded

• Fourth Round - $97M (FY17)

SAW Deliverables

• A complete Asset Management Program

• Asset Management Program available topublic

• Certification that scope of work has beencompleted

• Submit a summary of the AMP, whichincludes identifying major assets of the plan

• Before 2 ½ year point submit the ratemethodology

• AMP moves into the NPDES process

Simplified Asset Management Program

• Asset Inventory/Criticality

• Level of Service

• Rate Methodology

• Capital Improvement Plan

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Asset Inventory Table 1

Directions

A. List assets

B. Enter asset information

C. To add more assets use insert function and add rows then copy first asset row to new rows to transfer formulas

D. Enter information in highlighed cells

E. Remaining cells will calculate automatically.

A B C D E F G H I J K L

Source Assets Material Location Manufacturer Original Cost Replacement CostRemaining Useful

Life in Years Condition RedundancyLikeliness of

FailureConsequence

of Failure Criticality Factor

well #1 pump 0 0 5 5 25

Enter asset 0 0

Enter asset 0 0

Enter asset 0 0

Enter asset 0 0

Enter asset 0 0

Enter asset 0 0

If Criticality Factor is greater than 16 cell will turn RED

If Criticality Factor is greater than 16 add to CIP table

A B C D E F G H I J K L

Treatment Assets Material Location Manufacturer Original Cost Replacement CostRemaining Useful

Life in Years Condition RedundancyLikeliness of

FailureConsequence

of Failure Criticality Factor

chlorinator 0 4 5 20

Enter asset 0 0

Enter asset 0 0

Enter asset 0 2 3 6

Enter asset 0 4 4 16

Enter asset 0 5 5 25

Enter asset 0 0

If Criticality Factor is greater than 16 cell will turn RED

If Criticality Factor is greater than 16 add to CIP table

Rate Methodology Table 3

DirectionsA. To add more line item expenses use insert function and add rows then copy first line item row to new rows to transfer formulasB. Enter information in highlighed cellsC. Remaining cells will calculate automatically.

(select one) <<< Click at left and select flow units (million cubic feet or millions of gallons) Calculate Operating Reserve (optional if creating budget for only OM&R)

0.00 <<< Enter annual billable flow in units selected above 6$ Total OM&R from Expenditures in table below0 <<< Enter typical quarterly flow of single-family home in units selected above 3$ Targeted Operating Reserve Amount (this is 50% of OM&R)

(select one) <<< Click at left and select the type of fixed units <<< Enter amount of cash or equivalents0 <<< Enter number of fixed units 3$ Additional Operating Reserves Needed (If negative number, stop here)

1. Edit budget items below, if needed <<< Enter # of years to accumulate reserves (rule of thumb is 5 years)2. Enter budget amount for each item in highlighted cells -$ Annual Contribution To Achieve Targeted Operating Reserve Amount3. Under Options 3 and 4, enter percent of entire budget allocated to billable flow (Variable). The remainder is allocated to Fixed.4. Under Option 5, enter percent of each budget item allocated to billable flow. The remainder is allocated to Fixed.5. Click on Capital Improvements tab and Replacement tab to complete those worksheets

Expenditures Budget Option 1 Option 2Variable Fixed Variable Fixed Variable Fixed Variable Fixed100% 100% 80% 20% 20% 80% % 0% 0%

Operation, Maintenance and Repair (OM&R)Salaries -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ * Insurance -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ * Dental -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ * MERS -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ * Medicare -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ * FICA -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ * Disability -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Unemployment Insurance -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Postage -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Bank Charges -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Operating Supplies -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Contract Services -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Telephone -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Dues -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Printing -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Insurance & Bonds -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Utilities -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Repairs -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Maintenance 2$ 2$ 2$ 2$ 0$ 0$ 2$ 0% -$ -$ Rentals 2$ 2$ 2$ 2$ 0$ 0$ 2$ 0% -$ -$ GIS software 2$ 2$ 2$ 2$ 0$ 0$ 2$ 0% -$ -$ Replacement (See Table 4) -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Total OM&R 6$ 6$ 6$ 5$ 1$ 1$ 5$ -$ -$ Capital Improvement (See Table 6) 2$ 2$ 2$ 2$ 0$ 0$ 2$ 0% -$ 2$ Operating Reserves 2$ 2$ 2$ 2$ 0$ 0$ 2$ 0% -$ 2$ Debt Expenses -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Miscellaneous -$ -$ -$ -$ -$ -$ -$ 0% -$ -$ Total Water System Expenses 10$ 10$ 10$ 8$ 2$ 2$ 8$ -$ 4$

Calculate Rate Option 1 Option 2Select flow unit in cell A4 -$ -$ Enter type of fixed units into cell A7 -$ -$ Quarterly Bill for single-family home -$ -$

-$ Option 3 Option 4 Option 5

-$ -$ -$

-$ -$

-$

Option 3 Option 4

-$

Option 5

-$

Capital Improvement Project Plan Table 6

Directions

A. List projects to be completed

B. Determine how long before the project must begin

C. Enter the total projected cost of the project

D. To add more CIP's use insert function and add rows then copy first CIP row to new rows to transfer formulas

E. Enter information in highlighed cells

F. Remaining cells will calculate automatically.

A B C

ProjectsYears Until Project

Must Begin Cost Reserve Required Each Year

Install arsenic treatment on well #1 0 $ - $ -

Expand transmission main 0 $ - $ -

Build elevated storage tank 0 $ - $ -

Enter project 0 $ - $ -









Total Capital Improvement reserve required in the current year $ -

Click Total to add to Budget

Financial Assessments (FA)Program

• Safe Drinking Water Act, Section 1420(c) StateCapacity Development Strategies – to developand implement a: "strategy to assist public watersystems in acquiring and maintaining technical,managerial, and financial capacity."

• For water systems (wastewater)

• Populations of less than 10,000

• Any recommendations are voluntary

• No charge for assessment

Financial Assessment Process

• RLS reviews financial and legaldocuments

• Onsite visit to discuss findings

• Prepare a Financial Action Plan (FAP)

• FAP can be basis for DWRF loan

• Asset Management /CUPSS

• Follow-up as necessary

Lessons Learned

• Lots of tools out there - confusing

• Time consuming but doesn’t have to beexpensive

• AM is a long term process – incrementalsteps

• Need to be flexible and make adjustments

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Questions?

Bob SchneiderMichigan Department of Environmental Quality

Revolving Loan Section

517-388-6466

[email protected]

Documents

CLEAN WATER AND DRINKING WATER STATE REVOLVING FUND PROGRAMS knowledge/rc... · CLEAN WATER AND DRINKING WATER STATE REVOLVING FUND PROGRAMS ... prolong asset life, ... the CWSRF