<a id="pl.1.3"></a><var>1.3</var>providing for small community wastewater treatment grants;amending <br/>
<a id="pl.1.4"></a><var>1.4</var>Minnesota Statutes 2012, sections 446A.073, subdivisions 1, 3, 4; 446A.075, <br/>
<a id="pl.1.5"></a><var>1.5</var>subdivisions 1a, 2, 5, 6; repealing Minnesota Statutes 2012, sections 446A.051, <br/>
<a id="pl.1.6"></a><var>1.6</var>subdivision 2; 446A.074.<br/>
<a id="pl.1.7"></a><var>1.7</var>BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:<br/>
<br/>
<a id="bill.0.1.0"></a><a id="pl.1.8"></a><var>1.8</var>    Section 1. Minnesota Statutes 2012, section 446A.073, subdivision 1, is amended to <br/>
<a id="pl.1.9"></a><var>1.9</var>read:<br/>
<a id="pl.1.10"></a><var>1.10</var>    Subdivision 1. <b>Program established.</b> When money is appropriated for grants under <br/>
<a id="pl.1.11"></a><var>1.11</var>this program, the authority must make shall award grants up to a maximum of $3,000,000 <br/>
<a id="pl.1.12"></a><var>1.12</var>to governmental units to cover up to one-half the cost of wastewater treatment or storm <br/>
<a id="pl.1.13"></a><var>1.13</var>water projects made necessary by:<br/>
<a id="pl.1.14"></a><var>1.14</var>(1) a wasteload reductions reduction prescribed under a total maximum daily load <br/>
<a id="pl.1.15"></a><var>1.15</var>plans plan required by section 303(d) of the federal Clean Water Act, United States Code, <br/>
<a id="pl.1.16"></a><var>1.16</var>title 33, section 1313(d).;<br/>
<a id="pl.1.17"></a><var>1.17</var>(2) a phosphorus concentration or mass limit which requires discharging one <br/>
<a id="pl.1.18"></a><var>1.18</var>milligram per liter or less at permitted design flow which is incorporated into a permit <br/>
<a id="pl.1.19"></a><var>1.19</var>issued by the Pollution Control Agency;<br/>
<a id="pl.1.20"></a><var>1.20</var>(3) any other water quality-based effluent limit established under section 115.03, <br/>
<a id="pl.1.21"></a><var>1.21</var>subdivision 1, paragraph (e), clause (8), and incorporated into a permit issued by the <br/>
<a id="pl.1.22"></a><var>1.22</var>Pollution Control Agency that exceeds secondary treatment limits; or<br/>
<a id="pl.1.23"></a><var>1.23</var>(4) a total nitrogen limit of ten milligrams per liter or less for a land-based treatment <br/>
<a id="pl.1.24"></a><var>1.24</var>system.<br/>
<br/>
<a id="bill.0.2.0"></a><a id="pl.2.1"></a><var>2.1</var>    Sec. 2. Minnesota Statutes 2012, section 446A.073, subdivision 3, is amended to read:<br/>
<a id="pl.2.2"></a><var>2.2</var>    Subd. 3. <b>Project priorities.</b> When money is appropriated for grants under this <br/>
<a id="pl.2.3"></a><var>2.3</var>program, the authority shall accept applications during the month of July and reserve <br/>
<a id="pl.2.4"></a><var>2.4</var>money for projects expected to proceed with construction by the end of the fiscal year in <br/>
<a id="pl.2.5"></a><var>2.5</var>the order listed on the Pollution Control Agency's project priority list, provided the project <br/>
<a id="pl.2.6"></a><var>2.6</var>is included in a total maximum daily load plan that has been approved by the United <br/>
<a id="pl.2.7"></a><var>2.7</var>States Environmental Protection Agency at the time the appropriation became law and in <br/>
<a id="pl.2.8"></a><var>2.8</var>an amount based on the cost estimate submitted to the authority in the grant application or <br/>
<a id="pl.2.9"></a><var>2.9</var>the as-bid costs, whichever is less.<br/>
<br/>
<a id="bill.0.3.0"></a><a id="pl.2.10"></a><var>2.10</var>    Sec. 3. Minnesota Statutes 2012, section 446A.073, subdivision 4, is amended to read:<br/>
<a id="pl.2.11"></a><var>2.11</var>    Subd. 4. <b>Grant approval.</b> The authority must make a grant to a governmental unit, <br/>
<a id="pl.2.12"></a><var>2.12</var>as defined in section 
<statute_ref>116.182, subdivision 1</statute_ref>, for an eligible project only after:<br/>
<a id="pl.2.13"></a><var>2.13</var>(1) the commissioner of the Pollution Control Agency has certified to the United <br/>
<a id="pl.2.14"></a><var>2.14</var>States Environmental Protection Agency a total maximum daily load plan for identified <br/>
<a id="pl.2.15"></a><var>2.15</var>waters of this state that includes a point source wasteload allocation;<br/>
<a id="pl.2.16"></a><var>2.16</var>(2) the Environmental Protection Agency has approved the plan;<br/>
<a id="pl.2.17"></a><var>2.17</var>(3) a governmental unit affected by the plan (1) the applicant has submitted the <br/>
<a id="pl.2.18"></a><var>2.18</var>as-bid cost for the wastewater treatment or storm water projects necessary to comply with <br/>
<a id="pl.2.19"></a><var>2.19</var>the point source wasteload allocation project;<br/>
<a id="pl.2.20"></a><var>2.20</var>(4) (2) the Pollution Control Agency has approved the as-bid costs and certified the <br/>
<a id="pl.2.21"></a><var>2.21</var>grant eligible portion of the project; and<br/>
<a id="pl.2.22"></a><var>2.22</var>(5) (3) the authority has determined that the additional financing necessary to <br/>
<a id="pl.2.23"></a><var>2.23</var>complete the project has been committed from other sources.<br/>
<br/>
<a id="bill.0.4.0"></a><a id="pl.2.24"></a><var>2.24</var>    Sec. 4. Minnesota Statutes 2012, section 446A.075, subdivision 1a, is amended to read:<br/>
<a id="pl.2.25"></a><var>2.25</var>    Subd. 1a. <b>Technical assistance grants.</b> If requested, and if it is an eligible use <br/>
<a id="pl.2.26"></a><var>2.26</var>of funds, the authority may provide technical assistance grants to governmental units <br/>
<a id="pl.2.27"></a><var>2.27</var>seeking to address noncomplying subsurface sewage treatment systems. A grant under <br/>
<a id="pl.2.28"></a><var>2.28</var>this subdivision must not exceed $10,000 $20,000 plus $500 $1,000 per household, for <br/>
<a id="pl.2.29"></a><var>2.29</var>a maximum total of $40,000 $60,000. Technical assistance grant funds may be used <br/>
<a id="pl.2.30"></a><var>2.30</var>by the a county recipient to pay its qualified staff for services listed in clauses (1) to <br/>
<a id="pl.2.31"></a><var>2.31</var>(3) or by a governmental unit to contract with a licensed subsurface sewage treatment <br/>
<a id="pl.2.32"></a><var>2.32</var>system business, county, the University of Minnesota on-site sewage treatment program, a <br/>
<a id="pl.2.33"></a><var>2.33</var>regional development commission, or other qualified nonprofit organization for one or <br/>
<a id="pl.2.34"></a><var>2.34</var>more of the following services:<br/>
<a id="pl.3.1"></a><var>3.1</var>(1) conduct site evaluations and prepare a report by a certified subsurface sewage <br/>
<a id="pl.3.2"></a><var>3.2</var>treatment system designer indicating the feasibility of installing new subsurface sewage <br/>
<a id="pl.3.3"></a><var>3.3</var>treatment systems meeting the requirements of section 
         <statute_ref>115.55</statute_ref>;<br/>
<a id="pl.3.4"></a><var>3.4</var>(2) provide independent advice on the feasibility of subsurface sewage treatment <br/>
<a id="pl.3.5"></a><var>3.5</var>system alternatives; and<br/>
<a id="pl.3.6"></a><var>3.6</var>(3) assist the governmental unit to develop the technical, managerial, and financial <br/>
<a id="pl.3.7"></a><var>3.7</var>capacity necessary to build, operate, and maintain subsurface sewage treatment systems.<br/>
<br/>
<a id="bill.0.5.0"></a><a id="pl.3.8"></a><var>3.8</var>    Sec. 5. Minnesota Statutes 2012, section 446A.075, subdivision 2, is amended to read:<br/>
<a id="pl.3.9"></a><var>3.9</var>    Subd. 2. <b>Construction loans and grants.</b> (a) The authority may award loans and <br/>
<a id="pl.3.10"></a><var>3.10</var>grants as provided in this subdivision to governmental units from the small community <br/>
<a id="pl.3.11"></a><var>3.11</var>wastewater treatment account for projects to replace noncomplying subsurface sewage <br/>
<a id="pl.3.12"></a><var>3.12</var>treatment systems with a subsurface sewage treatment system or systems meeting the <br/>
<a id="pl.3.13"></a><var>3.13</var>requirements of section 
         <statute_ref>115.55</statute_ref> or a land-based treatment system with a state disposal <br/>
<a id="pl.3.14"></a><var>3.14</var>system permit. A governmental unit receiving a loan or grant from the account shall own <br/>
<a id="pl.3.15"></a><var>3.15</var>the subsurface sewage treatment systems built under the program and shall be responsible, <br/>
<a id="pl.3.16"></a><var>3.16</var>either directly or through a contract with a private vendor, for all inspections, maintenance, <br/>
<a id="pl.3.17"></a><var>3.17</var>and repairs necessary to ensure proper operation of the systems.<br/>
<a id="pl.3.18"></a><var>3.18</var>    (b) Loans as provided in subdivision 6 may be awarded for up to 100 percent <br/>
<a id="pl.3.19"></a><var>3.19</var>of eligible project costs as described in this section minus any grants awarded under <br/>
<a id="pl.3.20"></a><var>3.20</var>paragraph (c) or from other sources.<br/>
<a id="pl.3.21"></a><var>3.21</var>    (c) When the area to be served by a project has a median household income below <br/>
<a id="pl.3.22"></a><var>3.22</var>the state average median household income, the governmental unit may receive 50 percent <br/>
<a id="pl.3.23"></a><var>3.23</var>of the funding provided under this subdivision in the form of a grant. An applicant may <br/>
<a id="pl.3.24"></a><var>3.24</var>submit income survey data collected by an independent party if it believes the most recent <br/>
<a id="pl.3.25"></a><var>3.25</var>United States census does not accurately reflect the median household income of the area <br/>
<a id="pl.3.26"></a><var>3.26</var>to be served. The authority may award a grant to a project if the estimated average annual <br/>
<a id="pl.3.27"></a><var>3.27</var>residential wastewater system cost after completion of the project would otherwise exceed <br/>
<a id="pl.3.28"></a><var>3.28</var>1.4 percent of the median household income of the project service area. In determining the <br/>
<a id="pl.3.29"></a><var>3.29</var>estimated average annual residential wastewater system cost, the authority must consider <br/>
<a id="pl.3.30"></a><var>3.30</var>the total costs associated with building, operating, and maintaining the wastewater system <br/>
<a id="pl.3.31"></a><var>3.31</var>including debt service. The amount of the grant shall be 80 percent of the amount <br/>
<a id="pl.3.32"></a><var>3.32</var>needed to reduce the average annual residential wastewater system cost to 1.4 percent of <br/>
<a id="pl.3.33"></a><var>3.33</var>the median household income, but not to exceed 80 percent of the eligible project cost <br/>
<a id="pl.3.34"></a><var>3.34</var>minus any other grants.<br/>
<br/>
<a id="bill.0.6.0"></a><a id="pl.4.1"></a><var>4.1</var>    Sec. 6. Minnesota Statutes 2012, section 446A.075, subdivision 5, is amended to read:<br/>
<a id="pl.4.2"></a><var>4.2</var>    Subd. 5. <b>Awards.</b> (a) The authority must award loans and grants as provided in this <br/>
<a id="pl.4.3"></a><var>4.3</var>section to governmental units with approved applications based on their ranking on the <br/>
<a id="pl.4.4"></a><var>4.4</var>Pollution Control Agency's project priority list.<br/>
<a id="pl.4.5"></a><var>4.5</var>(b) Except as provided in paragraph (c), prior to the award of construction loans or <br/>
<a id="pl.4.6"></a><var>4.6</var>grants under subdivision 2, paragraph (b), the Pollution Control Agency shall certify <br/>
<a id="pl.4.7"></a><var>4.7</var>that the subsurface sewage land-based treatment systems to be built appear to meet are <br/>
<a id="pl.4.8"></a><var>4.8</var>designed according to the criteria set forth in section 
         <statute_ref>115.55</statute_ref> and rules of the Pollution <br/>
<a id="pl.4.9"></a><var>4.9</var>Control Agency.<br/>
<a id="pl.4.10"></a><var>4.10</var>(c) If a governmental unit receives preliminary approval by the Pollution Control <br/>
<a id="pl.4.11"></a><var>4.11</var>Agency of its feasibility report prepared under subdivision 1a, clause (1), the authority <br/>
<a id="pl.4.12"></a><var>4.12</var>may make a partial construction award for eligible design costs.<br/>
<a id="pl.4.13"></a><var>4.13</var>(d) The total amount awarded for a construction loans and grants project under <br/>
<a id="pl.4.14"></a><var>4.14</var>subdivision 2, paragraph (b), shall be based on the estimated project costs for the portion <br/>
<a id="pl.4.15"></a><var>4.15</var>of the project expected to be completed within one year, up to an annual maximum of <br/>
<a id="pl.4.16"></a><var>4.16</var>$500,000. For projects expected to take more than one year to complete, the authority <br/>
<a id="pl.4.17"></a><var>4.17</var>may make a multiyear commitment for a period not to exceed three years, contingent on <br/>
<a id="pl.4.18"></a><var>4.18</var>the future availability of funds. Each year of a multiyear commitment must be funded <br/>
<a id="pl.4.19"></a><var>4.19</var>by a separate loan or loan and grant agreement meeting the terms and conditions in <br/>
<a id="pl.4.20"></a><var>4.20</var>subdivision 6. A governmental unit receiving a loan or loan and grant under a multiyear <br/>
<a id="pl.4.21"></a><var>4.21</var>commitment shall have priority for additional loan and grant funds in subsequent years<br/>
<a id="pl.4.22"></a><var>4.22</var> must not exceed $2,000,000.<br/>
<br/>
<a id="bill.0.7.0"></a><a id="pl.4.23"></a><var>4.23</var>    Sec. 7. Minnesota Statutes 2012, section 446A.075, subdivision 6, is amended to read:<br/>
<a id="pl.4.24"></a><var>4.24</var>    Subd. 6. <b>Loan terms and conditions.</b> Loans from the small community wastewater <br/>
<a id="pl.4.25"></a><var>4.25</var>treatment account shall comply with the following terms and conditions:<br/>
<a id="pl.4.26"></a><var>4.26</var>    (1) principal and interest payments must begin no later than two years after the <br/>
<a id="pl.4.27"></a><var>4.27</var>loan is awarded;<br/>
<a id="pl.4.28"></a><var>4.28</var>    (2) loans shall carry an interest rate of one percent;<br/>
<a id="pl.4.29"></a><var>4.29</var>    (3) loans shall be fully amortized within ten years of the first scheduled payment <br/>
<a id="pl.4.30"></a><var>4.30</var>or, if the loan amount exceeds $10,000 per household, shall be fully amortized within 20 <br/>
<a id="pl.4.31"></a><var>4.31</var>years but not to exceed the expected design life of the system;<br/>
<a id="pl.4.32"></a><var>4.32</var>    (4) a governmental unit receiving a loan must establish a dedicated source or sources <br/>
<a id="pl.4.33"></a><var>4.33</var>of revenues for repayment of the loan and must issue a general obligation note to the <br/>
<a id="pl.4.34"></a><var>4.34</var>authority for the full amount of the loan; and<br/>
<a id="pl.5.1"></a><var>5.1</var>    (5) each property owner voluntarily seeking assistance for repair or replacement of <br/>
<a id="pl.5.2"></a><var>5.2</var>an individual treatment system under this program must provide a utility easement to the <br/>
<a id="pl.5.3"></a><var>5.3</var>governmental unit to allow access to the system for management and repairs.<br/>
<br/>
<a id="bill.0.8.0"></a><a id="pl.5.4"></a><var>5.4</var>    Sec. 8. <b>WASTEWATER INFRASTRUCTURE FUNDING; CONVERSION OF </b><br/>
<a id="pl.5.5"></a><var>5.5</var><b>CERTAIN LOANS TO GRANTS.</b><br/>
<a id="pl.5.6"></a><var>5.6</var>For supplemental assistance provided under its wastewater infrastructure funding <br/>
<a id="pl.5.7"></a><var>5.7</var>program in the form of a loan, the public facilities authority may convert the loan to a <br/>
<a id="pl.5.8"></a><var>5.8</var>grant to the extent that the authority determines that the governmental unit would have <br/>
<a id="pl.5.9"></a><var>5.9</var>met, at the time the loan was made, the criteria in Minnesota Statutes 2012, section <br/>
<a id="pl.5.10"></a><var>5.10</var>446A.072, subdivision 5a, paragraph (b). If a loan is converted to a grant only in part, <br/>
<a id="pl.5.11"></a><var>5.11</var>then, notwithstanding section 446A.072, subdivision 7, the authority may determine the <br/>
<a id="pl.5.12"></a><var>5.12</var>manner in which the repayment schedule for the loan is to be adjusted.<br/>
<br/>
<a id="bill.0.9.0"></a><a id="pl.5.13"></a><var>5.13</var>    Sec. 9. <b>INSTRUCTIONS TO REVISOR.</b><br/>
<a id="pl.5.14"></a><var>5.14</var>(a) In Minnesota Statutes, the revisor shall remove references to the sections <br/>
<a id="pl.5.15"></a><var>5.15</var>repealed in section 10.<br/>
<a id="pl.5.16"></a><var>5.16</var>(b) In Minnesota Statutes, the revisor shall change the headnote to section 446A.073 <br/>
<a id="pl.5.17"></a><var>5.17</var>to "Point Source Implementation Grants."<br/>
<br/>
<a id="bill.0.10.0"></a><a id="pl.5.18"></a><var>5.18</var>    Sec. 10. <b> REPEALER.</b><br/>
<a id="pl.5.19"></a><var>5.19</var>Minnesota Statutes 2012, sections 446A.051, subdivision 2; and 446A.074, are <br/>
<a id="pl.5.20"></a><var>5.20</var>repealed.<br/>