From The EditorSusan McCannonPlanning and Funding SpecialistSusan.McCannon@feiengineers.com

The Colorado Department of Public Health and Environment (CDPHE), working with their partners at the Colorado Water

Resources and Power Development Authority (Authority) and the Colorado Department of Local Affairs (DOLA), have implemented a number of changes to the Drinking Water and Clean Water State Revolving Funds grants and loans programs as of January 1, 2015. They are currently in the process of holding a number of public workshops around the state to inform customers about the changes. Information on the work-shops can be found at http://www.cwrpda.com/futurestate.

I attended the February 18th workshop and was glad I did - there are quite a few changes that we will need to reflect in our funding strategies. Since the meeting I have spent time

studying the materials in preparation for being able to advise the communities I work with on how their funding strategies may need to change, starting this year. I am dedicating this issue of The Bucket Li$t to the new processes and procedures so that all water and wastewater system managers can be informed.

In addition, I would like to introduce a new member of the FEI Team that may be of particular interest to you. Bob Lonergan, P.E., can help you find ways to save money on your energy costs. Those saved dollars can then be directed to benefit your operations in many ways. Learn more about Bob on page 2.

5325 S Valentia Way | Greenwood Village, CO | 80111www.feiengineers.com | (303) 300-3464

Volume 5 Issue 1March, 2015

Funding and finance ideas and strategies for water and wastewater

How BIG is your project funding bucket... and what’s in it? We can help!

IN THIS ISSUE:

• SRFPROGRAMCHANGES

• THENEWPROCESS&GUIDELINES

• FEI’SNEWLEADERFORTHEENERGYPROGRAM

NewLeaderforFEI’sEnergyProgram

Bob Lonergan, P.E., has managed successful energy efficiency projects for more than a decade. His experience ranges from large Energy Savings Performance Contract (ESPC) projects, where guaranteed energy savings fund capital-intensive upgrades, to energy audits where the operator implements the recommended improvements. These projects involved various levels of complexity, and required Bob to work effectively with municipal clients, energy contractors, the EPA and the Colorado Governor’s Energy Office.

Bob gets excited about finding way to leverage energy/operational savings to fund upgrades and improve the bottom line at water and wastewater treatment facilities. In addition, he has a strong background in obtaining utility, local, state, and federal funding for energy optimization projects. He and I look forward to working together to as-sist clients in meeting their funding needs.

Bob Lonergan, P.E., Energy Lead

If you are thinking about the benefits of improved energy efficiency at your facility Bob would be happy to generate some ideas with you. Contact him at Bob.Lonergan@FEIEngineers.com or at (303) 928-1352.

StateRevolvingFund(SRF)Program

Changesfor2015

The 2015 changes in the State Revolving Fund programs are as follows:• Higherloancapsfordirectloans,up

to$2.5million,• Morefrequentopportunitiestosubmit

loanapplications,• Pre-screeningofallapplicantsand

projectsforacceptanceintothepro-gram,

• Completionofmoreofthedesignandengineeringprocesspriortotheloanapplication,

• Principalforgivenessloanshaveshift-edtoprovidePlanning,andDesignandEngineeringgrantsforqualifyingcommunities.

Volume 5 Issue 1 March 2015

In addition, the USDA has funds available through their Emergency Community Water Assistance Grant program. Applications for these grant funds can be submitted to your local Rural Development office at any time.

A few important aspects of this grant opportunity include:

• Funds can be used for construction, improvements, renovation or reconstruction. Preliminary design and plan-ning work must be included with the application.

• Funds can be used as a local match to FEMA and other funds

• $500,000 cap on water source, treatment, and trans-mission projects.

• $150,000 cap on distribution projects.

• Eligible communities have populations smaller than 10,000 and MHI less than the statewide MHI of $57,685.

Visit the USDA-Rural Development websitefor more information or click on this link:

http://www.rurdev.usda.gov/UWP-ecwag.htm

If your community is in a flood disaster area and still has impacts that need to be addressed,you are likely feeling exhausted and overwhelmed,but take heart - these funds can help you rebuildand I can help you prepare and submit a stronggrant application.

In addition, the preparation, submittal and approval processes related to design and engineering will experience a number of changes. These changes include:• Documentsandproductsarere-

vampedandrestructured,• Designreviewprocesseswilloffer

morechoices,i.e.standard,stream-line,orself-certify,and

• Documentsandproductsmustfollowprescribedformat,andbesubmittedelectronically.

Let’s talk about each of these changes in more detail below.

ProgramParameterstoChange

The higher loan cap or limit is good news for program borrowers. Previously, direct loans could not exceed $2 million. But we all know that project construction costs have been increasing, especially in the past year or so. This higher cap acknowledges that fact, and will make it easier for small projects to remain within the direct loan category, thus avoiding the higher administrative costs associated with a leveraged loan.

There will be seven opportunities to submit loan applications during the year, rather than the four in past years. The added opportunities will give communities more options to select a timeframe that best fits their project’s needs. If a particular deadline can’t be met, the next opportunity is only 30 or 60 days away, rather than the previous 90-day gap between deadlines. This will allow projects to keep moving forward in a timely manner, will reduce the pressure to meet deadlines, and spread out the workload for application reviewers. The 2015 application deadlines are Jan. 15, Feb. 15, Apr. 15, June 15, Aug. 15,

Oct. 15 and, Nov.15. Applications for leveraged loans or loans above $2.5 million will be acceped in January and June.

SRF Pre-Screening ProcessBefore submitting a loan or grant application each project must go through a loan pre-screening process. The annual Eligibility Survey is the entry point. Without it the project will not be included on the Project Eligibility List in the Intended Use Plan (IUP). The Survey is completed online and submitted electronically. The 2015 Eligibility Survey will be open in June.

Next, entities complete a Pre-Qualification Form to introduce the project to the Project Managers within the Grants and Loans Unit of the CDPHE. This pdf-fillable form, once completed, is submitted electronically. Following their review a mandatory pre-application meeting is convened to discuss the project, SRF eligibility, preliminary environmental determination, the entity’s financial analysis, the project funding strategy and projected timeframe as well as the primary requirements of the SRF program. If eligible CDPHE grant assistance options will be discussed as well. A follow-up review letter will recap findings, indicate the agency’s recommendation to apply for a loan and summarize next steps.

Project Design & Engineering ApprovalsIf a loan application recommendation is received, design and engineering on the project can begin. This phase starts with the preparation of the Project Needs Assessment (PNA) and Environmental Checklist, taking the place of the former Preliminary Engineering Report (PER). For Drinking Water projects, the PNA also includes information previously included in the Technical, Managerial and Financial (TMF) capacity assessment. Like the Pre-Qual Form the PNA is pdf-fillable with character limits, check boxes, dialogue balloons that provide additional guidance when a computer mouse hovers over them, and prescribed attachments. The PNA is submitted entirely electronically.

How BIG is your project funding bucket... and what’s in it? We can help!Volume 5 Issue 1 March 2015

For additional information on SRF changesor other topics covered in this issue of The Bucket Li$t please contact me at: Susan.McCannon@feiengineers.com

Loan Application SubmittalOnce the PNA, Site Application and Process Design Report have been approved then a loan application can be submitted. Plans and specifications must be submitted prior to or at the time of the loan application. This new requirement for completion of the bulk of design and engineering prior to loan application arises from the need of the SRF agencies to avoid unliquidated loan obligations (ULO). In the past, loans have been approved and funds obligated for projects that then ran into technical or financial snags thus preventing the project from progressing. This resulted in federal funds being tied up and not spent in a timely manner. That, in turn, creates a problem with the US-EPA who provides the annual capitalization grants for the SRF programs. To avoid ULOs and ensure projects get constructed in a timely manner the SRF agencies have added these pre-require-ments to loan application submittal.

Planning, Design & Engineering GrantsEligible communities can receive matching grants for planning, and design and engineering phases of their loan application process. The local match is 20%. The previous $10K Planning and Design grants will continue as $10K Planning grants to support the completion of the Project Needs Assessment, creation of an improvement district and/or conduct the environmental assessment. These grants may be awarded at the completion of the pre-qualification process.

Prior to 2015, the SRF program provided principal forgiveness loans. Those funds will now be used for design and engineering grants to assist with completion of the design submittals required before loan application. Grants may be awarded up to $250K depending on the project.

Eligibility criteria for both these types of grants include:• Populationof10,000orless• Medianhouseholdincome(MHI)80%orless

thanstatewideMHI(<=$46,746)The Planning Grant requires a completed Pre-Qual Form and pre-application meeting for grant consideration, and can be used to pay for

preparation of the PNA. Design and Engineering Grants require a completed PNA and environmental checklist for grant consideration and can be used to pay for the Site Application, Process Design Report, and/or Plans and Specifications.

Design&EngineeringProcessChanges

Requirements of the PER and TMF have been reconstructed into the Pre-Qual Form and the Project Needs Assessment (PNA). The Pre-Qual Form can be completed by the community but the PNA has to be completed by a professional engineer.

The CDPHE has opened up 3 different design review processes for projects seeking SRF loans:• Standardreviewprocess• Streamlinedreviewprocess–now

availabletoSRFprojects• Self-certificationprocess–nowavailabletoSRFprojects.

More information is at:https://www.colorado.gov/pacific/sites/default/files/SRF%20Design%20Fact%20Sheet.pdf

FEI Engineers is a full service professional engineering firm specializing in water and wastewater. With staff dedicated to project funding and system finance issues, as well asproject design, engineering and construction needs, we can help you reach your goals in moreways than one.

The Bucket Li$t is a quarterly electronic newsletter distributed by FEI Engineers. Please feel free to forward this newsletter to colleagues or other interested parties.