31 TAC §§371.21, 371.24, 371.25
The amendments and new section are 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.
The statutory provisions affected by the amendments and new section are
Texas Water Code, Chapter 15, Subchapter J, and Chapter 17, Subchapter C.
§371.21.Criteria and Methods for Distribution of Funds for Water System Improvements.
(a)
After the executive administrator determines the amount
of funds available for water system improvements for a fiscal year and assigns
all reserves, the remaining funds will be applied to the list of projects
designated to receive funding in the intended use plan. The list will be divided
into population classes of systems that serve fewer than 10,000 persons and
systems that serve 10,000 and over persons. Projects will be listed in priority
ranking order with funds required and totaled by class.
Except for projects
for disadvantaged communities, projects
[
Projects
] having
either identical combined rating factor scores, or identical physical deficiency
rating scores, or including rating scores of zero, will be listed in alphabetical
order. Funds required by all projects with combined rating factors greater
than zero in all classes shall then be totaled. A percentage of the total
funds required by each class shall be computed based upon the ratio of funds
required by all classes. The portion of the available funds will be assigned
to the classes based on this computed percentage. However, to the extent eligible
applicants are available, a minimum of 15% of the funds will be made available
to small communities (systems serving 10,000 or less).
(b)-(f)
(No change.)
(g)
If, after six months, the remaining funds are not committed,
the executive administrator will return any incomplete applications.
Except for funds for disadvantaged communities projects, any
[
Any
] funds remaining that exceed the amount needed to fund complete
applications will be made available for the next fiscal year.
Funds for
disadvantaged communities projects shall remain available for commitment in
accordance with §371.25 of this title, (relating to Criteria and Methods
for Distribution of Funds for Disadvantaged Communities).
(h)-(j)
(No change.)
§371.24. Disadvantaged Community Program through Loan Subsidies.
(a)
(No change.)
(b)
Definition of Disadvantaged Community.
(1)
(No change.)
(2)
Disadvantaged community means the service area of
a public water system that has an adjusted median household income which is
no more than 75% of the median state household income
[
at least
25% below the state average
] for the most recent year for which statistics
are available; and
(A)-(B)
(No change.)
(3)-(8)
(No change.)
(c)
Interest Rates and Subsidies.
Notwithstanding
the provisions of §371.52 of this title (relating to Lending Rates),
the interest rates and the levels of subsidies under the disadvantaged community
program will be determined by
the provisions of this subsection. The
loan amount that is subject to forgiveness will not be subject to an interest
rate
[
a calculation of critical need and affordability factors
].
(1)
If the adjusted median household income
for the service area is between 75% and 70% of the median state household
income, the board's financial assistance shall be in the form of a loan with
a 1.0% interest rate.
(2)
If the adjusted median household
income for the service area is less than or equal to 70% but greater than
60% of the median state household income, the board's financial assistance
shall be in the form of a loan with a 0.0% interest rate.
(3)
If the adjusted median household
income for the service area is less than or equal to 60% but greater than
50% of the median state household income, the board's financial assistance
shall be in the form of a loan with a 0.0% interest rate and 15% of the principal
will be forgiven.
(4)
If the adjusted median household
income for the service area is less than or equal to 50% of the median state
household income, the board's financial assistance shall be in the form of
a loan with a 0.0% interest rate and 35% of the principal will be forgiven.
(d)-(f)
(No change.)
(g)
Consolidations.
(1)
Financial assistance for consolidations.
(A)
If the applicant acquires another public
water system or provides retail service to another public water system, 20%
of the cost of the project is subject to forgiveness of principal.
(B)
If the applicant provides wholesale service
to another public water system, 15% of the cost of the project is subject
to forgiveness of principal.
(C)
The amount of principal that will be forgiven
for the consolidation will be deducted from the cost of the project before
calculating the amount of financial assistance for the remaining cost of the
project pursuant to §371.24(c) of this title (relating to Interest Rates
and Subsidies).
(2)
Eligible costs.
(A)
Any one or more of the following costs
of consolidation are eligible for funding:
(i)
system acquisitions;
(ii)
the cost of plant upgrades or expansions
specific to providing service to the disadvantaged community;
(iii)
the cost of rehabilitating or replacing
the distribution system of an existing water system to bring the system into
compliance with drinking water regulations;
(iv)
the provision of wholesale service; and
(v)
master meters and upgrades needed to receive
wholesale service from the consolidating system.
(B)
Notwithstanding the provisions of §371.13(a)(4)
of this title (relating to Projects Eligible for Assistance), purchase of
existing capacity in the consolidating system are not eligible for funding
through the Disadvantaged Community Account of the DWSRF.
§371.25.Criteria and Methods for Distribution of Funds for Disadvantaged Communities.
(a)
The board will determine annually the amount of capitalization
grant funds to be reserved for projects for disadvantaged communities and
will include this information in the intended use plan, provided however that
no more than 30% of any capitalization grant can be so reserved.
(b)
After the executive administrator determines the amount
of funds available for disadvantaged communities projects from capitalization
grant reserves, state match, or any other sources, the available funds will
be applied to the list of systems that serve fewer than 10,000 persons and
the list of systems that serve 10,000 and over persons in accordance with
§371.21(a) of this title (relating to Criteria and Methods for Distribution
of Funds for Water System Improvements). All projects will be listed in priority
ranking order as determined by §371.19 of this title (relating to Rating
Process). Disadvantaged communities projects assigned identical rating scores
will be listed in the order of their adjusted median annual household income
(AMAHI), with those communities having the lower AMAHI being listed higher
on the priority list than those having higher AMAHIs. In the event that one
or more disadvantaged communities have rating scores identical to the rating
scores of non-disadvantaged communities, the disadvantaged communities will
be listed above the non-disadvantaged communities on the priority list.
(c)
After projects have been ranked, a funding line will be
drawn on the priority lists according to the amount of available funds in
accordance with §371.21(b) of this title (relating to Criteria and Methods
for Distribution of Funds for Water System Improvements). After the funding
line is drawn, the executive administrator shall notify in writing all potential
applicants above the funding line of the availability of funds and will invite
the submittal of applications. In order to receive funding, disadvantaged
communities projects above the funding line must submit applications for assistance,
as defined, within six months of the date of notification of the availability
of funds. Upon receipt of an application for assistance, the executive administrator
shall notify the applicant, in writing, that an application has been received.
The executive administrator may request additional information regarding any
portions of an application for funding from the disadvantaged community account
after the six month period has expired without affecting the priority status
of the application. Applicants for funding from the disadvantaged community
account will be allowed 12 months after submittal of an application to receive
a loan commitment.
(d)
Applicants for funding from the disadvantaged community
account above the funding line which do not submit applications before the
six month deadline will be moved to the bottom of the priority list in priority
order.
(e)
If after six months, there are insufficient applications
to obligate all of the funds set aside for disadvantaged communities, the
executive administrator will return any incomplete applications and move all
projects for which no applications or incomplete applications were submitted
to the bottom of the priority list, where they will be placed in priority
order.
(f)
Following the re-ranking of the priority list, a line
will again be drawn not to exceed the amount of funds available, in accordance
with the criteria of subsection (b) of this section.
(g)
Projects above the funding line shall be eligible for
assistance. After the funding line is re-drawn, the executive administrator
shall notify, in writing, all potential applicants for funding from the disadvantaged
community account of the availability of funds and will invite the submittal
of applications. Applicants for funding from the disadvantaged community account
will be allowed 12 months after submittal of an application to receive a loan
commitment.
(h)
If, after six months, there are insufficient applications
to obligate the remaining funds of the funds set aside for disadvantaged communities,
the executive administrator will return any incomplete applications. Any funds
remaining that exceed the amount needed to fund completed applications will
be transferred from the fund for disadvantaged communities to the fund for
large and small communities.
(i)
If, at any time during either six month period of availability
of funds, a potential applicant above the funding line submits written notification
that it does not intend to submit an application or if additional funds become
available for assistance, the funding line may be moved down the priority
list to accommodate the additional projects. The executive administrator will
notify such additional potential applicants for funding from the disadvantaged
community account in writing and will invite the submittal of applications.
Potential applicants receiving such notice will be given 12 months to submit
an application.
(j)
Should an applicant which has submitted an application
in a timely manner be unable to receive a loan commitment within 12 months
of the date on which the application was received, the applicant's project
will be placed at the bottom of the priority list.
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.
Issued in Austin, Texas, on January 2, 1998.
TRD-9800002
Gail L. Allan
Administration and Northern Legal Services
Texas Water Development Board
Proposed date of adoption: February 19, 1998
For further information, please call: (512) 463-7981