Part 10.
TEXAS WATER DEVELOPMENT BOARD
Chapter 371.
DRINKING WATER STATE REVOLVING FUND
The Texas Water Development Board (the board) proposes the repeal
of existing §371.4 and proposes amendments to §§371.14, 371.22,
371.24, and 371.51, concerning the Drinking Water State Revolving Fund.
The board proposes the repeal of §371.4, Date of Applicability of
Rules, relating to the term of the applicability of the rules. As currently
written, §371.4 applies the provisions of this chapter to financial assistance
applications received during federal fiscal years 1997 through 2003. At the
time of adoption of this section, it was not anticipated that the board would
continue to receive federal funds under this program. The board proposes to
repeal this section so that these rules will continue to apply to all applications
received under this program.
The board proposes to delete §371.14(a)(3). This paragraph currently
authorizes the board to make expenditures in federal fiscal years 1996 and
1997 to delineate and assess source water protection projects and providing
that such funds must be obligated within four years of the rule adoption.
The Texas Commission on Environmental Quality is the state agency responsible
for this activity and has reported successfully completing these projects.
Consequently, the board proposes the deletion of this provision as appropriate.
The board proposes an amendment to §371.22, concerning Administrative
Cost Recovery to clarify that the administrative cost recovery fee is a non-fundable
fee which is based on the amount of the loan at the time of closing. Though
the existing language has been interpreted and applied by the board in this
manner, this amendment is proposed in order to insure that loan recipients
fully appreciate the nature of the fee payment.
The board proposes to amend §371.24(b)(7) concerning the determination
of an area that is eligible for Loan Subsidies under the Disadvantaged Community
Program. Currently, this paragraph calculates the adjusted median household
income specifically using 1990 income data and requiring that such data be
adjusted using the 1990 Texas Consumer Price Index. The board proposes to
amend this paragraph to provide that the median household income may be determined
from the most recent United States Census data and that it will be adjusted
using the most recent Texas Consumer Price Index.
The board proposes to amend §371.24(d) concerning additional project
costs in excess of the project costs identified in the intended use plan.
Currently, this subsection provides that project costs in excess of the project
costs identified on the intended use plan will be provided through the Water
Supply Account of the Texas Water Development Fund. With the creation of the
Texas Water Development Fund II, the reference to the Water Supply Account
is no longer appropriate. This subsection is amended to reflect this change.
The board proposes to amend §371.51(c) concerning the commitment date
of a loan made by the board. Currently, the intent of the rule is to identify
a date certain by which time the applicant must close the loan with the board.
This subsection, however, is entitled "Commitment Date" which is misleading
since the subsection does not address the date on which the commitment is
made by the board but rather the date by which the loan must be closed. The
title of the subsection is therefore amended to be "Closing Date." Further,
as currently written, the subsection requires that the closing date must occur
24 months from the day in the month of the board meeting at which the commitment
was made. As applied, the applicant must close the loan or request an extension
of the closing date before that day in the 24th month. If the board schedules
its meeting on a day later in that 24th month, the applicant is effectively
limited to closing the loan or requesting a time extension within 23 months
rather than the intended 24 months. The board did not intend this result and
does not make a similar requirement for its other programs. The board proposes
to amend §371.51(c) so that the closing date must occur on any day within
the 24th calendar month following the date that the board made the commitment.
The intent of this proposed amendment is that, as an example, if the board
makes a commitment on April 15, 2005, the applicant must close the loan on
any day in April 2007 or must request and obtain an extension of the closing
date from the board at the board's meeting in April 2007. In this manner,
the applicant receives the benefit of the full 24 calendar months in which
to act on the commitment and makes this program consistent with the board's
other programs relative to the closing date requirement. The board proposes
to further amend this subsection by deleting the language relating to extending
the time to close the loan so that it can be placed in a new subsection. The
board proposes this amendment in order to improve the clarity of the respective
requirements.
The board proposes a new subsection (d) to §371.51, relating to the
extension of the closing date. As currently written, subsection (c) refers
to extending the commitment date. However, since the commitment date is the
date of the original board action, there is no action that can occur that
can extend that date. The intention of the current provision, rather, is to
extend the date by which the closing must occur. Further, as currently configured,
two distinct requirements are combined in one sentence: the requirement to
close the loan and the method to extend the closing date. This combination
unnecessarily convolutes these requirements, which creates unnecessary ambiguity.
By creating a proposed new subsection, the two distinct requirements are separated
in order to clarify the respective requirements. Additionally, the proposed
new subsection (d) now specifies that a request to extend the closing date
must be submitted by the applicant in writing and identify a reasonable basis
for the extension. These requirements are included because the board believes
that it is important to the effective operation of the program to close these
loans in a timely manner. Therefore, this proposed new subsection requires
that any request to extend a closing should be submitted in writing and identify
a justifiable reason to move the closing date. Since the initial closing date
is set by the board in this rule and because of the importance of closing
loans to the effective operation of the program, this proposed new subsection
also requires that the board approve any extension to the closing date. It
is the intent of the proposed new subsection that the board will determine
whether the basis to extend as identified by the applicant is reasonable in
order for the extension to be approved.
Melanie Callahan, Director of Fiscal Services, has determined that for
the first five-year period the repeal and amendments are in effect there will
not be fiscal implications on state and local government as a result of enforcement
and administration of the repeal and amended sections.
Ms. Callahan has also determined that for the first five years the repeal
and amendments, as proposed, are in effect the public benefit anticipated
as a result of enforcing the proposed repeal and amended sections will be
to have more streamlined and easily understandable rules. Ms. Callahan has
determined there will not be economic costs to small businesses or individuals
required to comply with the repeal and amendments as proposed.
Comments on the proposal will be accepted for 30 days following publication
and may be submitted to Jonathan Steinberg, Deputy Counsel, Texas Water Development
Board, P.O. Box 13231, Austin, Texas 78711-3231, by e-mail to jonathan.steinberg@twdb.state.tx.us
or by fax at (512) 463-5580.
Subchapter A. INTRODUCTORY PROVISIONS
31 TAC §371.4
(Editor's note: The text of the following section proposed for
repeal will not be published. The section may be examined in the offices of
the Texas Water Development Board or in the Texas Register office, Room 245,
James Earl Rudder Building, 1019 Brazos Street, Austin.)
The repeal is proposed under the authority of the
Texas Water Code §6.101 and §15.605 which provide the Texas Water
Development Board with the authority to adopt rules necessary to carry out
the powers and duties in the Water Code and other laws of the State including
specifically the SRF program.
The statutory provision affected by the proposed repeal is Texas Water
Code, Chapter 15, Subchapter J.
§371.4.Date of Applicability of Rules.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State on January 19, 2005.
TRD-200500260
Suzanne Schwartz
General Counsel
Texas Water Development Board
Proposed date of adoption: March 9, 2005
For further information, please call: (512) 475-2052
Subchapter B. PROGRAM REQUIREMENTS