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STATE REVOLVING
FUND FY 2014 Intended Use Plans
Patti Cale-Finnegan, Iowa Department of Natural Resources
Background
The SRF is Iowa’s primary source of financing for drinking water and wastewater infrastructure, storm water quality, and nonpoint source protection
Background
SRF programs authorized by Clean Water Act and Safe Drinking Water Act and administered by U.S. Environmental Protection Agency
Background
Background
Program frameworks and eligibility set by federal law, but each state can set its own priorities for use of funds
Background • Iowa Code
– 455B.291-299 (DNR)
– 16.131-133A (IFA)
• Iowa Administrative Code – 567 Chapters 40 and 44 – DWSRF (adopted by EPC)
– 567 Chapters 90-93 – CWSRF (adopted by EPC)
– 265 Chapter 16 – SRF (adopted by Iowa Finance Authority Board)
• “The program shall be a joint and cooperative
undertaking of the department and the
authority.”
Background • Iowa Department of Natural Resources
– Program planning and prioritization
– Project planning and permitting
– Environmental review
– Federal compliance
• Iowa Finance Authority – Financial management
– Bond issues
– Loan processing
– Loan disbursements
LOW-INTEREST
LOANS FOR
Water and
wastewater
infrastructure
only
1989 - 2002
2003 - Present
Water and
Wastewater Planning and Design
Urban Stormwater
Soil, Sediment, and Nutrient
Management
Onsite
Septic
Systems
Source
Water
Protection
Brownfield Cleanup
Landfill Closure
Lake and Wetland Restoration
Energy and Water Efficiency
Sponsored
Projects
GOVERNOR
Iowa Department of Natural
Resources Director
Environmental
Services
Division
Administrative
Services
Division
Iowa Finance
Authority Director
SECRETARY OF
AGRICULTURE
Iowa Department of
Agriculture and
Land Stewardship
Water Supply
Engineering
DNR SRF
Coordinator
Wastewater
Permitting
DNR Grant
Manager
Local Water Protection
Livestock Water Quality
Facilities
Storm Water BMP Loans
CWSRF Project
Managers
DWSRF Project
Managers
General Non-Point
Source Program
State Revolving Fund Organizational Structure -- Iowa
Administrative
Assistant
SRF Program
Specialists
Water Quality
Bureau
Water Supply
Operations
Environmental
Review
Specialists
IFA SRF
Coordinator
SRF Finance
Officer
SRF Linked
Deposit
Administrator
On-Site
Wastewater
Program
Wastewater
Engineering
Chief Financial
Officer Comptroller
SRF Accountants
Growth of SRF
$-
$500,000,000
$1,000,000,000
$1,500,000,000
$2,000,000,000
$2,500,000,000
Drinking water
Nonpoint
Wastewater
Intended Use Plans • EPA requirement
• Outlines funding available and proposed uses
• Sets goals and objectives
• Sets program policies such as interest rates and terms, disadvantaged community criteria
• Public review and comment
• Approval by EPC
Drinking Water SRF • Loans for:
– Improvements to public water supply systems
– Consolidations and connections
– Source water protection
• DWSRF set-asides fund technical assistance, capacity development, state drinking water program, SWP
Drinking Water SRF Applicant Project Request
New Hartford Water meter upgrade $80,000
Libertyville Planning and design loan to investigate solutions
to water main breaks
$95,000
Winneshiek County Install public water supply in Frankville to
replace contaminated private wells
$762,000
Columbus Junction Relocate water treatment plant out of 100-year
flood plain
$1,206,000
Mahaska Rural Water New wells, backup power, water treatment
upgrade, emergency connection
$3,609,000
Ames New LEED-certified water treatment facility $51,000,000
Clean Water SRF • Loans for:
– Publicly owned wastewater treatment facilities
– Sewer system rehabilitation
– New systems for unsewered communities
– Stormwater management for water quality
– Nonpoint source pollution control
Clean Water SRF Applicant Project Request
Oxford Planning and design loan to investigate
inflow/infiltration into sanitary sewers
$67,000
Buffalo Upgrade wastewater disinfection system $360,000
Ottumwa Combined sewer separation $3,636,000
Denver Convert lagoons to mechanical plant, add
disinfection, to meet permit limits
$6,153,000
Dubuque Daylighting of buried storm sewer to improve
water quality and prevent neighborhood flooding
$14,767,000
Sioux City Relocation of sewers due to I-29 expansion $23,000,000
Loan Types
• Planning and design
– 0% financing for up to 3 years
• Water and wastewater construction
– 1.75% interest rate
– Terms up to 30 years for some projects
• Source water protection
– 0% interest for 20 years
Environmental Review
• Environmental review
specialists assist with
ER process
• Brick sewers, historic
water towers, pioneer
cemeteries, Native
American sites, Indiana
bats, Topeka Shiner, flood
plains, wetlands, etc.
Environmental Review
• Master contracts with
archeology and/or
architectural history
firms reduce delays and
problems
• SRF pays for needed
surveys out of fees paid
by applicants
Nonpoint Source Loans
• Low-cost financing for
nonpoint source projects
• Project approval by
environmental agency
• Financing approval by
participating lender
• Interest rate max 3%
• Can be used with cost-share,
EQIP, other grants
• On-Site Wastewater
Systems
– Helps homeowners
replace inadequate
septic systems
– Contact county
sanitarian
– All 99 counties
participate
• Iowa Department of Agriculture and Land
Stewardship agreement
Partnership with IDALS
• Soil and Water
Conservation Districts
• Natural Resources
Conservation Service
• Ag Best Practices – Soil erosion
– Manure management
– Non-CAFO size livestock operations
– IDALS administers through contract with DNR
– Apply through Soil and Water Conservation Districts
– NRCS technical help
• LWPP participants had smaller
operations but invested more in
conservation than farmers that used
cost-share only
• LWQ participants spent an average of
$80,000 or 50% more than livestock
producers that used EQIP only
• “Overall the study results indicate
that the loan programs are leading
to significant benefits for Iowa’s
lands and waters. The loans appear
to be complementing traditional
conservation programs and helping
landowners to get more practices
on the landscape more quickly than
they would have otherwise.”
• Green Infrastructure – Water quality benefit in
lowering volume and treating stormwater
– Use Iowa Stormwater Management Manual standards
– Review by SWCDs and IDALS Urban Conservationists
– Both public and private borrowers
• Land Quality
‒ Brownfield
cleanup
‒ Landfill closure
‒ Apply to DNR
‒ Review by DNR
Contaminated
Sites staff or
Solid Waste
engineers
– INHF gets loan from local
bank which uses SRF
funds
– INHF holds properties for
3-5 years while government
agency assembles funding
– Land turned over to public
ownership
• Land Preservation / Wetland Restoration – Partnerships between Iowa Natural Heritage
Foundation, DNR, County Conservation Boards, etc.
Agricultural BMPs 62%
Onsite Wastewater
9%
Urban BMPs 15%
Land Preservation
14%
Sponsored Projects • Allows wastewater
utilities to address
nonpoint source
problems
• $15 million set-aside
for first year
• Applications due July
19
$-
$200,000.00
$400,000.00
$600,000.00
$800,000.00
$1,000,000.00
$1,200,000.00
$1 million CWSRF
loan
$1 million loan with
sponsored project
Loan Costs (interest and fees)
Sponsored project principal
Wastewater principal
Loan Forgiveness • Started with federal stimulus
• Attached to annual capitalization grants
• Must provide certain percentage of cap
grant amount as “additional subsidization”
• Have committed loan forgiveness to help
disadvantaged communities, promote
solutions to public health problems, and
incentivize green projects
Program Income Fee Description Uses
Origination fee 0.5% of loan
amount added
to the loan
amount
“Program income” – can only be used to
administer the SRF programs. This
includes water supply and wastewater
engineering section project managers,
environmental review, nonpoint source
program administrators,financial officers,
loan coordinators, program managers, and
financial and legal advisors.
Servicing fee
(first 1-3 years
of loan)
0.25% annual
fee on
outstanding
principal
Non-Program Income Fee Description Uses
Servicing fee
(final 19 – 30
years of loan)
0.25% annual
fee on
outstanding
principal
CWSRF:
• Utility management organization
contracts
• DNR wastewater field staff
• DNR Water Quality Bureau staff
DWSRF:
• State match for Public Water Program
set-aside
Coming up in FY 2014 • Taking applications year-round
• Quarterly updates of the IUPs in September, December, March
• Sponsored project application review and recommendations
• Allocate remainder of loan forgiveness
• Anticipated disbursements: – CWSRF: $282 million
– DWSRF: $150 million
Questions?
Patti Cale-Finnegan
Iowa Department of Natural Resources
515-725-0498
Lori Beary
Iowa Finance Authority
515-725-4965