HF 819

1st Engrossment - 88th Legislature (2013 - 2014) Posted on 05/18/2013 06:48pm

A bill for an act
relating to the Public Facilities Authority; reorganizing certain grant programs;
providing for small community wastewater treatment grants; amending
Minnesota Statutes 2012, sections 446A.073, subdivisions 1, 3, 4; 446A.075,
subdivisions 1a, 2, 5, 6; repealing Minnesota Statutes 2012, sections 446A.051,
subdivision 2; 446A.074.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2012, section 446A.073, subdivision 1, is amended to
read:

Subdivision 1.

Program established.

When money is appropriated for grants under
this program, the authority deleted text begin must make deleted text end new text begin shall award new text end grants up to a maximum of $3,000,000
to governmental units to cover up to one-half the cost of wastewater treatment or storm
water projects made necessary by new text begin :
new text end

new text begin (1) a new text end wasteload deleted text begin reductions deleted text end new text begin reduction prescribed new text end under new text begin a new text end total maximum daily load
deleted text begin plans deleted text end new text begin plan new text end required by section 303(d) of the federal Clean Water Act, United States Code,
title 33, section 1313(d) deleted text begin . deleted text end new text begin ;
new text end

new text begin (2) a phosphorus concentration or mass limit which requires discharging one
milligram per liter or less at permitted design flow which is incorporated into a permit
issued by the Pollution Control Agency;
new text end

new text begin (3) any other water quality-based effluent limit established under section 115.03,
subdivision 1, paragraph (e), clause (8), and incorporated into a permit issued by the
Pollution Control Agency that exceeds secondary treatment limits; or
new text end

new text begin (4) a total nitrogen limit of ten milligrams per liter or less for a land-based treatment
system.
new text end

Sec. 2.

Minnesota Statutes 2012, section 446A.073, subdivision 3, is amended to read:

Subd. 3.

Project priorities.

When money is appropriated for grants under this
program, the authority shall accept applications during the month of July and reserve
money for projects expected to proceed with construction by the end of the fiscal year in
the order listed on the Pollution Control Agency's project priority list deleted text begin , provided the project
is included in a total maximum daily load plan that has been approved by the United
States Environmental Protection Agency at the time the appropriation became law deleted text end and in
an amount based on the cost estimate submitted to the authority in the grant application or
the as-bid costs, whichever is less.

Sec. 3.

Minnesota Statutes 2012, section 446A.073, subdivision 4, is amended to read:

Subd. 4.

Grant approval.

The authority must make a grant deleted text begin to a governmental unit,
as defined in section 116.182, subdivision 1, deleted text end new text begin for an eligible project new text end only after:

deleted text begin (1) the commissioner of the Pollution Control Agency has certified to the United
States Environmental Protection Agency a total maximum daily load plan for identified
waters of this state that includes a point source wasteload allocation;
deleted text end

deleted text begin (2) the Environmental Protection Agency has approved the plan;
deleted text end

deleted text begin (3) a governmental unit affected by the plan deleted text end new text begin (1) the applicant new text end has submitted the
as-bid cost for the wastewater treatment or storm water deleted text begin projects necessary to comply with
the point source wasteload allocation deleted text end new text begin project new text end ;

deleted text begin (4) deleted text end new text begin (2) new text end the Pollution Control Agency has approved the as-bid costs and certified the
grant eligible portion of the project; and

deleted text begin (5) deleted text end new text begin (3) new text end the authority has determined that the additional financing necessary to
complete the project has been committed from other sources.

Sec. 4.

Minnesota Statutes 2012, section 446A.075, subdivision 1a, is amended to read:

Subd. 1a.

Technical assistance grants.

If requested, and if it is an eligible use
of funds, the authority may provide technical assistance grants to governmental units
seeking to address noncomplying subsurface sewage treatment systems. A grant under
this subdivision must not exceed deleted text begin $10,000 deleted text end new text begin $20,000 new text end plus deleted text begin $500 deleted text end new text begin $1,000 new text end per household, for
a maximum total of deleted text begin $40,000 deleted text end new text begin $60,000 new text end . Technical assistance grant funds may be used
by deleted text begin the deleted text end new text begin a county recipient to pay its qualified staff for services listed in clauses (1) to
(3) or by a new text end governmental unit to contract with a licensed subsurface sewage treatment
system business, new text begin county, new text end the University of Minnesota on-site sewage treatment program, a
regional development commission, or other qualified nonprofit organization for one or
more of the following services:

(1) conduct site evaluations and prepare a report by a certified subsurface sewage
treatment system designer indicating the feasibility of installing new subsurface sewage
treatment systems meeting the requirements of section 115.55;

(2) provide independent advice on the feasibility of subsurface sewage treatment
system alternatives; and

(3) assist the governmental unit to develop the technical, managerial, and financial
capacity necessary to build, operate, and maintain subsurface sewage treatment systems.

Sec. 5.

Minnesota Statutes 2012, section 446A.075, subdivision 2, is amended to read:

Subd. 2.

Construction loans and grants.

(a) The authority may award loans and
grants as provided in this subdivision to governmental units from the small community
wastewater treatment account for projects to replace noncomplying subsurface sewage
treatment systems with a subsurface sewage treatment system or systems meeting the
requirements of section 115.55 new text begin or a land-based treatment system with a state disposal
system permit new text end . A governmental unit receiving a loan or grant from the account shall own
the subsurface sewage treatment systems built under the program and shall be responsible,
either directly or through a contract with a private vendor, for all inspections, maintenance,
and repairs necessary to ensure proper operation of the systems.

(b) Loans new text begin as provided in subdivision 6 new text end may be awarded for up to 100 percent
of eligible project costs deleted text begin as described in this section deleted text end new text begin minus any grants awarded under
paragraph (c) or from other sources new text end .

(c) deleted text begin When the area to be served by a project has a median household income below
the state average median household income, the governmental unit may receive 50 percent
of the funding provided under this subdivision in the form of a grant. An applicant may
submit income survey data collected by an independent party if it believes the most recent
United States census does not accurately reflect the median household income of the area
to be served. deleted text end new text begin The authority may award a grant to a project if the estimated average annual
residential wastewater system cost after completion of the project would otherwise exceed
1.4 percent of the median household income of the project service area. In determining the
estimated average annual residential wastewater system cost, the authority must consider
the total costs associated with building, operating, and maintaining the wastewater system
including debt service. The amount of the grant shall be 80 percent of the amount
needed to reduce the average annual residential wastewater system cost to 1.4 percent of
the median household income, but not to exceed 80 percent of the eligible project cost
minus any other grants.
new text end

Sec. 6.

Minnesota Statutes 2012, section 446A.075, subdivision 5, is amended to read:

Subd. 5.

Awards.

(a) The authority must award loans and grants as provided in this
section to governmental units with approved applications based on their ranking on the
Pollution Control Agency's project priority list.

(b) Except as provided in paragraph (c), prior to the award of construction loans or
grants under subdivision 2, paragraph (b), the Pollution Control Agency shall certify
that the deleted text begin subsurface sewage deleted text end new text begin land-based new text end treatment systems to be built deleted text begin appear to meet deleted text end new text begin are
designed according to new text end the criteria set forth in section 115.55 and rules of the Pollution
Control Agency.

(c) If a governmental unit receives preliminary approval by the Pollution Control
Agency of its feasibility report prepared under subdivision 1a, clause (1), the authority
may make a partial construction award for eligible design costs.

(d) The total amount awarded for new text begin a new text end construction deleted text begin loans and grants deleted text end new text begin project new text end under
subdivision 2 deleted text begin , paragraph (b), shall be based on the estimated project costs for the portion
of the project expected to be completed within one year, up to an annual maximum of
$500,000. For projects expected to take more than one year to complete, the authority
may make a multiyear commitment for a period not to exceed three years, contingent on
the future availability of funds. Each year of a multiyear commitment must be funded
by a separate loan or loan and grant agreement meeting the terms and conditions in
subdivision 6. A governmental unit receiving a loan or loan and grant under a multiyear
commitment shall have priority for additional loan and grant funds in subsequent years
deleted text end new text begin must not exceed $2,000,000 new text end .

Sec. 7.

Minnesota Statutes 2012, section 446A.075, subdivision 6, is amended to read:

Subd. 6.

Loan terms and conditions.

Loans from the small community wastewater
treatment account shall comply with the following terms and conditions:

(1) principal and interest payments must begin no later than two years after the
loan is awarded;

(2) loans shall carry an interest rate of one percent;

(3) loans shall be fully amortized within deleted text begin ten years of the first scheduled payment
or, if the loan amount exceeds $10,000 per household, shall be fully amortized within deleted text end 20
years but not to exceed the expected design life of the system;

(4) a governmental unit receiving a loan must establish a dedicated source or sources
of revenues for repayment of the loan and must issue a general obligation note to the
authority for the full amount of the loan; and

(5) each property owner voluntarily seeking assistance for repair or replacement of
an individual treatment system under this program must provide a utility easement to the
governmental unit to allow access to the system for management and repairs.

Sec. 8. new text begin WASTEWATER INFRASTRUCTURE FUNDING; CONVERSION OF
CERTAIN LOANS TO GRANTS.
new text end

new text begin For supplemental assistance provided under its wastewater infrastructure funding
program in the form of a loan, the public facilities authority may convert the loan to a
grant to the extent that the authority determines that the governmental unit would have
met, at the time the loan was made, the criteria in Minnesota Statutes 2012, section
446A.072, subdivision 5a, paragraph (b). If a loan is converted to a grant only in part,
then, notwithstanding section 446A.072, subdivision 7, the authority may determine the
manner in which the repayment schedule for the loan is to be adjusted.
new text end

Sec. 9. new text begin INSTRUCTIONS TO REVISOR.
new text end

new text begin (a) In Minnesota Statutes, the revisor shall remove references to the sections
repealed in section 10.
new text end

new text begin (b) In Minnesota Statutes, the revisor shall change the headnote to section 446A.073
to "Point Source Implementation Grants."
new text end

Sec. 10. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2012, sections 446A.051, subdivision 2; and 446A.074, new text end new text begin are
repealed.
new text end