SWIFt-CWSRF Webinar

May 29, 2019

Gary BingenheimerIllinois EPA - Bureau of Water

Infrastructure Financial Assistance Section

Who can apply?

Any public loan applicant for:

Construction of publicly owned treatment works;

Measures to reduce demand for public treatment works capacity;

Measures to reduce energy consumption needs at publicly owned treatment works;

Any public or private loan applicant:

Decentralized wastewater treatment

Stormwater projects

Several categories related to waster efficiency, energy efficiency, security and water reuse

Wastewater Treatment Plant – new / rehabilitation / replacement / treatment enhancements

Sanitary Sewer - rehabilitation/replacement/lining

Pump Station replacement/rehabilitation

Combined Sewer Overflow elimination

Combined Sewer separation

Stormwater – Must provide an environmental benefit that improves or protects water quality

Engineering costs related to the planning, design and construction of a project

Assistance to any public, private, or nonprofit entity for measures to manage, reduce, treat, or recapture stormwater or subsurface drainage water. Eliminates ownership restraints on regulated stormwater projects.

Projects required by a Municipal Separate Storm Sewer System (MS4) permit are now eligible.

Examples – green roofs, rain gardens, roadside plantings, porous pavement, and rainwater harvesting.

Like any SRF funded project – must have a dedicated source of revenue for entire term of loan.

Projects must provide a water quality benefit – projects must be designed to keep pollutants out of waterways. Stream channel and bank stabilization

In-stream habitat restoration

Wetland restoration and enhancement

Lakeshore stabilization

Detention practices

Erosion and sediment control

Buffer and filter strips

Rain gardens and rain barrels

Permeable and porous pavement

Green roofs

Bio-swales

Downspout and illicit inflow disconnections (from CSOs and SSOs)

Average Loan - $11M

No minimum loan amount

Rarely cap maximum loan amount

Typically fund all engineering (planning, design, construction oversight) and construction activity.

Base Interest Rate FY2019 – 1.84%

No Application Fees

Loan Term 20 Years Up to 30 Year Term for applicants that qualify as

“disadvantaged communities

Engineering costs will need to be fronted byloan applicant – reimbursed once loan issued

Application begins with submittal of a “ProjectPlan”. Report defining project scope, cost,environmental issues and financial impacts.Final design not necessary to initiate application

Project Plan Report Received/Reviewed

Project Plan Approval - following public participation and environmental clearances

Construction Permit/Plan & Spec Approval

Engineering Contracts Reviewed

Loan Application Package submitted/approved

Financial Information approved

Advertise for bids (45 days recommended)

Bid Package submitted/approved

Loan Agreement Issued – Construction can begin

2014 – 80 Loans - $505 M

2015 – 45 Loans - $384 M

2016 – 71 Loans - $856 M

2017 – 79 Loans - $914 M

2018 – 66 Loans - $733 M

2019:

$225M Drinking Water

$450M Wastewater

Reduced interest rates/Max 30 year loan term

Public Loan Applicant’s Only

Small Community Rate - 75% of Base Rate

Must have service population less than 25,000 and satisfy one of the three following criteria; MHI less than state average

Unemployment rate greater than state average

Monthly User Charges greater than 1.0% of MHI

Hardship Rate – 1.0% Interest Rate

Must have service population less than 10,000 and satisfy one of the three following criteria; MHI less than 70% of state average

Unemployment rate 3.0% greater than state average

Monthly User Charges greater than 1.5% of MHI

Environmental Impact Discount –

0.2% interest rate reduction

If 50% of project contain any of following components

Unsewered Community

Nutrient Removal/Nutrient Loss Reduction

Green Infrastructure

Lower water demand

Reduce energy demand

Removal/complete replacement of lead in water mains or service lines

The SRF loan programs can offer a reduction to the amount of principal that an applicant would otherwise need tor repay for its project. This reduction is called “principal forgiveness”, per federal statute.

Principal forgiveness functions much like a grant i.e., eliminating a portion of the principal that the borrower must repay.

IEPA establishes the amount of principal forgiveness at the time of loan execution.

The Clean Water Act stipulates that state CWSRF loan programs may provide up to 30% of the available Capitalization Grant funds as principal forgiveness to loan recipients who satisfy the “affordability criteria” established by the state.

The terms and conditions of the annual Capitalization Grant stipulate that each state CWSRF loan program must provide 10% of the available Capitalization Grant funds as principal forgiveness. Use of the funds and eligibility is determined by the state (Illinois will use it’s “affordability criteria” to provide this principal forgiveness).

Per the Clean Water Act the affordability criteria established by each state shall be based on income, unemployment, population trends and other data determined relevant by the State.

IEPA’s Water Pollution Control Loan Program “affordability criteria” are defined in 35 Illinois Administrative Code Section 365.250(b).

The Illinois EPA Website is periodically updatedwith new program information and links to formsand documents needed to execute a full andcomplete loan application.

https://www2.illinois.gov/epa/topics/grants-loans/state-revolving-fund/Pages/default.aspx

Financial Assistance Section – 217-782-2027

Gary.Bingenheimer@Illinois.gov

5/29/2019