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OREGON BUSINESS DEVELOPMENT DEPARTMENT

 

DIVISION 49

SAFE DRINKING WATER REVOLVING LOAN FUND

 

123-049-0005

Purpose, Scope and Incorporated Documents

(1) This division of administrative rules implements a federally funded state revolving fund to provide financing to community and nonprofit non-community drinking water systems for planning, design, construction or improvement of drinking water facilities or systems needed to maintain or achieve compliance with drinking water standards and to further public health protection goals of the federal Safe Drinking Water Act Amendments of 1996 P.L. 104-182 and this state's Drinking Water Quality Act.

(2) In accordance with ORS 285A.213, this division of administrative rules governs the administration of the moneys awarded through this Safe Drinking Water Revolving Loan Fund by the Oregon Business Development Department through its Infrastructure Finance Authority in cooperation with the State of Oregon's Health Services of the Oregon Department of Human Services, but not activities of Health Services itself.

(3) "SAFE DRINKING WATER IN OREGON: Program Guidelines & Applicant's Handbook for the Federally Funded Safe Drinking Water Revolving Loan Fund & Drinking Water Protection Fund" (July 2009 and any subsequent amendments), including but not limited to its appendices, is:

(a) The principal source of information on this program, as prepared by the Authority;

(b) Available by contacting any of the Authority’s regionally assigned staff;

(c) Incorporated into and adopted as part of this division of administrative rules, by reference;

(d) Subject to the same definitions as used in this division of administrative rules; and

(e) Provides guidance specific to assistance for economic stimulus funding authorized by the American Recovery and Reinvestment Act of 2009 and allocated through the Safe Drinking Water Revolving Loan Fund Program.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 285A.075 & 285A.213(4)
Stats. Implemented: ORS 285A.213
Hist.: EDD 6-1999, f. & cert. ef. 8-26-99; EDD 11-2000(Temp), f. 7-20-00, cert. ef. 7-20-00 thru 1-16-01; EDD 1-2001, f. 1-11-01, cert. ef. 1-12-01; EDD 8-2004, f. & cert. ef. 2-3-04; EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08; EDD 2-2009(Temp), f. & cert. ef. 3-6-09 thru 9-1-09; EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09; OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10

123-049-0010

Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, unless the context clearly indicates otherwise:

(1) "Act" means the Safe Drinking Water Act at 42 U.S.C. 300f et seq., including amendments of 1996 (Public Law 104-182), and any subsequent amendments

(2) "Applicant" means a community or nonprofit non-community water system that is applying for a loan from the Fund.

(3) "Community water system" means a public water system, other than one owned by an agency of the federal government, that:

(a) Has 15 or more service connections used by year-round residents; or

(b) Regularly serves 25 or more year-round residents.

(4) "Contract" means a legally binding agreement between the department and recipient that sets out the terms and conditions for award of project funds.

(5) "Fund" means the Safe Drinking Water Revolving Loan Fund and the Drinking Water Protection Fund, which are the financing programs managed by the Authority under this division of administrative rules to pay for infrastructure improvements to eligible public water systems, and which includes moneys originating directly from federal capitalization grants (apart from set-asides), this state's match of such grants, program loan repayments, interest earnings and any additional funds provided by this state.

(6) "Intended Use Plan" the description of how the state intends to use moneys awarded and loaned from the fund to meet the objectives of the Act, as annually prepared by Health Services pursuant to USEPA guidelines.

(7) "Nonprofit non-community water system" means a public water system that:

(a) Is not a community water system;

(b) Regularly serves at least 25 people, even if they are not year-around residents; and

(c) Is recognized under Oregon law as a nonprofit corporation.

(8) "Project" means facility design construction activities or related/preceding tasks identified in the contract and loan agreement for which the recipient may expend, obligate or commit funds to address a drinking water problem or a documented health hazard.

(9) "Project priority list" means the comprehensive priority list of potential, eligible activities, as developed under the Intended Use Plan in response to letters of interest from community and nonprofit non-community water systems.

(10) A "public water system" means a system or infrastructure for the provision to the public of water for human consumption through pipe or other constructed conveyances, regardless of ownership, including but not limited to facilities for source of supply, filtration, treatment, storage, transmission or metering of that water.

(11) "Recipient" means a community or nonprofit non-community water system that has been awarded financing from the fund for a project.

(12) "USEPA" means the Environmental Protection Agency of the United States federal government.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 285A.075 & 285A.213(4)
Stats. Implemented: ORS 285A.213
Hist.: EDD 6-1999, f. & cert. ef. 8-26-99; EDD 8-2004, f. & cert. ef. 2-3-04; EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08; EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09; OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10

123-049-0020

Eligible Applicants and Activities

(1) All community water systems and nonprofit non-community water systems are eligible to apply for financing except those determined to be ineligible by the department because of prior nonperformance.

(2) Eligible and ineligible activities are defined in the Act and in USEPA’s Drinking Water State Revolving Fund Program Guidelines, EPA 816-R-97-005 (February 1997), as well as subsequent revisions or editions of such guidelines.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 285A.075 & 285A.213(4)
Stats. Implemented: ORS 285A.213
Hist.: EDD 6-1999, f. & cert. ef. 8-26-99; EDD 8-2004, f. & cert. ef. 2-3-04; EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08; EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09; OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10

123-049-0030

Program Information

(1) The Authority shall prepare program guidelines, application forms and other supplementary program information to help eligible applicants seek financing and prepare financing applications for the fund.

(2) Program guidelines as prepared under section (1) of this rule shall include an explanation of project eligibility, the project priority list, the Intended Use Plan, disadvantaged communities, types of financial assistance, loan rates and terms, borrowing limits, public notification process, contract administration, federal crosscutting requirements and environmental review process.

(3) In addition to this division of administrative rules, the Authority shall administer the fund in compliance with the requirements of the Act, as amended, and the Act's applicable rules, guidelines and requirements from USEPA.

(4) For purposes of land use coordination, any project activity paid for with financing from the Fund shall comply with the applicable requirements of division 8 of this chapter of administrative rules and OAR chapter 660.

Stat. Auth.: ORS 285A.075 & 285A.213(4)
Stats. Implemented: ORS 285A.213
Hist.: EDD 6-1999, f. & cert. ef. 8-26-99; EDD 8-2004, f. & cert. ef. 2-3-04; EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08; EDD 2-2009(Temp), f. & cert. ef. 3-6-09 thru 9-1-09; EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09; OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10

123-049-0040

Program Rights and Remedies

(1) The department may exercise certain rights and remedies in the event the recipient fails to comply with contract provisions and the recipient fails to correct the deficiencies within a reasonable time after the recipient is notified of the deficiencies. The circumstances that may warrant the department exercise of rights or remedies include, but are not limited to one or more of the following:

(a) None of the project activities have begun within six months after award;

(b) Any third party agreement relating to the project is not legally binding within six months of the award;

(c) Federal or state statutory or regulatory requirements have not been met;

(d) There is a significant deviation from the contract;

(e) The department finds that significant corrective actions are necessary to protect the integrity of the project funds, and those corrective actions are not, or will not, be made within a reasonable time; or

(f) A recipient defaults on loan payments, which may otherwise be made from any source of revenue at the recipient's disposal, including but not limited to General Fund revenue.

(2) One or more of the following rights and remedies may be exercised by the department if the recipient fails to comply with contract provisions and the recipient fails to correct the deficiencies within a reasonable time after recipient is notified of the deficiencies:

(a) Bar a recipient from applying for future department or Authority assistance;

(b) Revoke an existing department or Authority award;

(c) Withhold unexpended department or Authority funds;

(d) Require immediate return of unexpended department or Authority funds;

(e) Require repayment of expended department or Authority funds;

(f) Withhold other state funds otherwise due to the recipient, such as state-shared revenues; or

(g) Other remedies that may be incorporated into the contract.

(3) The remedies set forth in this rule are cumulative, are not exclusive, and are in addition to any other rights and remedies provided by law or under the contract.

(4) The recipient shall be responsible for ensuring that any subcontractor complies with the applicable terms and conditions of the contract. Nothing in this rule shall restrict the department’s right to enforce independently the terms of any contract or to recover any sums that may become due as the result of a breach of such contract.

Stat. Auth.: ORS 285A.075 & 285A.213(4)
Stats. Implemented: ORS 285A.213
Hist.: EDD 6-1999, f. & cert. ef. 8-26-99; EDD 8-2004, f. & cert. ef. 2-3-04; EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08; OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10

123-049-0050

Private Ownership and Regulation of Subsidies for Public Benefit

(1) Only if a privately owned public water system is regulated under the jurisdiction of the State of Oregon Public Utility Commission (PUC) may it enjoy the benefits of a "disadvantaged community," pursuant to section 1452(d) of the Act, in receiving financial assistance through the fund, including but not limited to principal forgiveness.

(2) The amount of subsidy shall not be treated as equity, but rather in all cases as a contingent liability on the balance sheet of the public water system receiving the financing and on the balance sheet of any entity that acquires that system or the assets financed by the Fund.

(3) If a water system is sold that was awarded subsidy by the fund, the value of the subsidy shall be effectively excluded from the purchase price, consistent with section (2) of this rule, such that the benefit of the principal forgiveness continues to accrue to the ratepayers or users of the system rather than to the seller. (This section also applies to the sale or lease of system assets financed by the loan, and it pertains but is not limited to the privatization of a publicly owned system)

(4) If section (2) or (3) of this rule is violated, then the water system shall repay the full amount of the subsidy into the fund. The Authority shall determine the schedule of such repayment, as it deems appropriate under the circumstances.

(5) The Oregon Public Utility Commission (PUC) has full authority to enforce the effects of this rule through applicable regulation of an affected water system.

(6) For non-PUC regulated privately-owned public water systems receiving financial assistance through the Fund under OAR 123-049-0005(3)(e), including but not limited to principle forgiveness, the amount of subsidy shall not be treated as equity, but rather in all cases as a contingent liability on the balance sheet of the public water system receiving the financing and on the balance sheet of any entity that acquires that system or the assets financed by the Fund. If the water system is sold that was awarded subsidy by the Fund, the value of the subsidy shall be effectively excluded from the purchase price, such that the benefit of the subsidy continues to accrue to the ratepayers or users of the system rather than to the seller. (This section also applies to the sale or lease of system assets financed by the Fund, and it pertains but is not limited to the privatization of a publicly owned system.) If this rule is violated, then the water system shall repay the full amount of the subsidy into the Fund. The Authority shall determine the schedule of such repayment, as it deems appropriate under the circumstances.

Stat. Auth.: ORS 285A.075 & 285A.213(4)
Stats. Implemented: ORS 285A.213
Hist.: EDD 11-2000(Temp), f. 7-20-00, cert. ef. 7-20-00 thru 1-16-01; EDD 1-2001, f. 1-11-01, cert. ef. 1-12-01; EDD 8-2004, f. & cert. ef. 2-3-04; EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08; EDD 2-2009(Temp), f. & cert. ef. 3-6-09 thru 9-1-09; EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09; OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10

123-049-0060

Drinking Water Protection Fund

(1) For purposes of implementing section 1452(k)(1) of the Act, the Authority shall administer loans and grants to public water systems for protecting surface and underground sources of drinking water, in order to solve or prevent health problems before the water is collected or treated by the system.

(2) The moneys for these loans and grants are derived from the "local assistance" set-aside of the federal capitalization grant, such that unused amounts will be transferred to the fund, and repayments shall be either added to the fund or placed in a dedicated account for further lending under this rule.

(3) The loans under this rule are distinct from the fund. Relevant provisions of this division of administrative rules, however, shall apply to the administration of such loans and grants(4) For purposes of this rule, administration includes underwriting assessments, loan awards, grant awards contract execution, disbursements, loan repayments and so forth.

(5) Health Services (Oregon Department of Human Services) and the Oregon Department of Environmental Quality shall handle determinations of eligibility, prioritization of loan grant recipients and related duties.

(6) More specific guidelines for the loans grant under this rule are available and included in the document incorporated by reference in OAR 123-049-0005(3).

Stat. Auth.: ORS 285A.075 & 285A.213(4)
Stats. Implemented: ORS 285A.213
Hist.: EDD 8-2004, f. & cert. ef. 2-3-04; EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08; EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09; OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10

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