SF 2215

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to the environment; creating the Clean Waters
Act; providing authority, direction, and funding to
achieve and maintain water quality standards for
Minnesota's surface waters in accordance with section
303(d) of the federal Clean Water Act; appropriating
money; amending Minnesota Statutes 2004, section
115.071, subdivision 3; proposing coding for new law
in Minnesota Statutes, chapter 446A; proposing coding
for new law as Minnesota Statutes, chapter 114D.

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

Section 1.

new text begin [114D.05] CITATION.
new text end

new text begin This chapter may be cited as the "Clean Waters Act."
new text end

Sec. 2.

new text begin [114D.15] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin The definitions provided in
this section apply to the terms used in this chapter.
new text end

new text begin Subd. 2. new text end

new text begin Citizen monitoring. new text end

new text begin "Citizen monitoring" means
monitoring of surface water quality by individuals and
nongovernmental organizations that is consistent with Pollution
Control Agency guidance on monitoring procedures, quality
assurance protocols, and data management.
new text end

new text begin Subd. 3. new text end

new text begin Clean water council. new text end

new text begin "Clean Water Council" or
"council" means the Clean Water Council created pursuant to
section 114D.30, subdivision 1.
new text end

new text begin Subd. 4. new text end

new text begin Federal tmdl requirements. new text end

new text begin "Federal TMDL
requirements" means the requirements of section 303(d) of the
Clean Water Act, United States Code, title 42, section 1313(d),
and associated regulations and guidance.
new text end

new text begin Subd. 5. new text end

new text begin Impaired water. new text end

new text begin "Impaired water" means surface
water that does not meet applicable water quality standards.
new text end

new text begin Subd. 6. new text end

new text begin Public agencies. new text end

new text begin "Public agencies" means all
state agencies, political subdivisions, joint powers
organizations, and special purpose units of government with
authority, responsibility, or expertise in protecting,
restoring, or preserving the quality of surface waters, managing
or planning for surface waters and related lands, or financing
waters-related projects. "Public agencies" also includes the
University of Minnesota and other public education institutions.
new text end

new text begin Subd. 7. new text end

new text begin Restoration. new text end

new text begin "Restoration" means actions,
including effectiveness monitoring, that are taken to achieve
and maintain water quality standards for impaired waters in
accordance with a TMDL that has been approved by the United
States Environmental Protection Agency under federal TMDL
requirements.
new text end

new text begin Subd. 8. new text end

new text begin Surface waters. new text end

new text begin "Surface waters" means waters
of the state as defined in section 115.01, subdivision 22,
excluding groundwater as defined in section 115.01, subdivision
6.
new text end

new text begin Subd. 9. new text end

new text begin Total maximum daily load or tmdl. new text end

new text begin "Total
maximum daily load" or "TMDL" means a calculation of the maximum
amount of a pollutant that may be introduced into a surface
water and still ensure that applicable water quality standards
for that water are achieved and maintained. A TMDL is the sum
of the pollutant load allocations for all sources of the
pollutant, including a load allocation for point sources, a load
allocation for nonpoint sources and natural background, a load
allocation for future growth of point and nonpoint sources, and
a margin of safety to account for uncertainty about the
relationship between pollutant loads and the quality of the
receiving surface water. "Natural background" means
characteristics of the water body resulting from the
multiplicity of factors in nature, including climate and
ecosystem dynamics, that affect the physical, chemical, or
biological conditions in a water body, but does not include
measurable and distinguishable pollution that is attributable to
human activity or influence. A TMDL must take into account
seasonal variations.
new text end

new text begin Subd. 10. new text end

new text begin Water quality standards. new text end

new text begin "Water quality
standards" for Minnesota surface waters are found in Minnesota
Rules, chapters 7050 and 7052.
new text end

Sec. 3.

new text begin [114D.20] IMPLEMENTATION; COORDINATION; GOALS;
POLICIES; AND PRIORITIES.
new text end

new text begin Subdivision 1. new text end

new text begin Coordination and cooperation. new text end

new text begin In
implementing this chapter, public agencies shall take into
consideration the relevant provisions of local and other
applicable water management, conservation, land use, land
management, and development plans and programs. Public agencies
with authority for local water management, conservation, land
use, land management, and development plans shall take into
consideration the manner in which their plans affect the
implementation of this chapter. Public agencies shall identify
opportunities to participate and assist in the successful
implementation of this chapter, including the funding or
technical assistance needs, if any, that may be necessary. In
implementing this chapter, public agencies shall endeavor to
engage the cooperation of organizations and individuals whose
activities affect the quality of surface waters, including point
and nonpoint sources of pollution, and who have authority and
responsibility for water management, planning, and protection.
To the extent practicable, public agencies shall endeavor to
enter into formal and informal agreements and arrangements with
federal agencies and departments to jointly utilize staff and
resources to deliver programs or conduct activities to achieve
the intent of this chapter, including efforts under the federal
Clean Water Act and other federal farm and soil and water
conservation programs.
new text end

new text begin Subd. 2. new text end

new text begin Goals for implementation. new text end

new text begin The following goals
must guide the implementation of this chapter:
new text end

new text begin (1) to identify impaired waters in accordance with federal
TMDL requirements within ten years after the effective date of
this section and thereafter to ensure continuing evaluation of
surface waters for impairments;
new text end

new text begin (2) to submit TMDL's to the United States Environmental
Protection Agency for all impaired waters in a timely manner in
accordance with federal TMDL requirements;
new text end

new text begin (3) to set a reasonable time for implementing restoration
of each identified impaired water;
new text end

new text begin (4) to provide assistance and incentives to prevent waters
from becoming impaired and to improve the quality of waters that
are listed as impaired but do not have an approved TMDL
addressing the impairment; and
new text end

new text begin (5) to promptly seek the delisting of waters from the
impaired waters list when those waters are shown to achieve the
designated uses applicable to the waters.
new text end

new text begin Subd. 3. new text end

new text begin Implementation policies. new text end

new text begin The following policies
must guide the implementation of this chapter:
new text end

new text begin (1) develop regional and watershed TMDL's, and TMDL's for
multiple pollutants, where reasonable and feasible;
new text end

new text begin (2) maximize use of available organizational, technical,
and financial resources to perform sampling, monitoring, and
other activities to identify impaired waters, including use of
citizen monitoring;
new text end

new text begin (3) maximize opportunities for restoration of impaired
waters, by prioritizing and targeting of available programmatic,
financial, and technical resources and by providing additional
state resources to complement and leverage available resources;
new text end

new text begin (4) use existing regulatory authorities to achieve
restoration for point and nonpoint sources of pollution where
applicable, and promote the development and use of effective
nonregulatory measures to address pollution sources for which
regulations are not applicable;
new text end

new text begin (5) use restoration methods that have a demonstrated
effectiveness in reducing impairments and provide the greatest
long-term positive impact on water quality protection and
improvement and related conservation benefits while
incorporating innovative approaches on a case-by-case basis;
new text end

new text begin (6) identify for the legislature any innovative approaches
that may strengthen or complement existing programs; and
new text end

new text begin (7) identify and encourage implementation of measures to
prevent waters from becoming impaired and to improve the quality
of waters that are listed as impaired but have no approved TMDL
addressing the impairment using the best available data and
technology, and establish and report outcome-based performance
measures that monitor the progress and effectiveness of
protection and restoration measures.
new text end

new text begin Subd. 4. new text end

new text begin Priorities for identifying impaired waters. new text end

new text begin The
Pollution Control Agency, in accordance with federal TMDL
requirements, shall set priorities for identifying impaired
waters, giving consideration to:
new text end

new text begin (1) waters where impairments would pose the greatest
potential risk to human or aquatic health; and
new text end

new text begin (2) waters where data developed through public agency or
citizen monitoring or other means provides evidence that an
impaired condition exists.
new text end

new text begin Subd. 5. new text end [PRIORITIES FOR PREPARATION OF TMDL'S.] new text begin The Clean
Water Council shall recommend priorities for scheduling and
preparing TMDL's taking into account the severity of the
impairment, the designated uses of those waters, and other
applicable federal TMDL requirements. In recommending
priorities, the council shall also give consideration to waters
and watersheds:
new text end

new text begin (1) with impairments that pose the greatest potential risk
to human health;
new text end

new text begin (2) with impairments that pose the greatest potential risk
to threatened or endangered species;
new text end

new text begin (3) with impairments that pose the greatest potential risk
to aquatic health;
new text end

new text begin (4) where other public agencies and participating
organizations and individuals, especially local, basinwide, or
regional agencies or organizations, have demonstrated readiness
to assist in carrying out the responsibilities, including
availability and organization of human, technical, and financial
resources necessary to undertake the work; and
new text end

new text begin (5) where there is demonstrated coordination and
cooperation among cities, counties, watershed districts, and
soil and water conservation districts in planning and
implementation of activities that will assist in carrying out
the responsibilities.
new text end

new text begin Subd. 6. new text end

new text begin Priorities for restoration of impaired
waters. new text end

new text begin In implementing restoration of impaired waters, in
addition to the priority considerations in subdivision 5 the
Clean Water Council shall give priority in its recommendations
for restoration funding from the clean water legacy account to
restoration projects that:
new text end

new text begin (1) coordinate with and utilize existing local authorities
and infrastructure for implementation;
new text end

new text begin (2) can be implemented in whole or in part by providing
support for existing or ongoing restoration efforts;
new text end

new text begin (3) most effectively leverage other sources of restoration
funding, including federal, state, local, and private sources of
funds;
new text end

new text begin (4) show a high potential for early restoration and
delisting based upon data developed through public agency or
citizen monitoring or other means; and
new text end

new text begin (5) show a high potential for long-term water quality and
related conservation benefits.
new text end

new text begin Subd. 7. new text end

new text begin Priorities for funding prevention actions. new text end

new text begin The
Clean Water Council shall apply the priorities applicable under
subdivision 6, as far as practicable, when recommending
priorities for funding actions to prevent waters from becoming
impaired and to improve the quality of waters that are listed as
impaired but do not have an approved TMDL.
new text end

Sec. 4.

new text begin [114D.25] ADMINISTRATION; POLLUTION CONTROL
AGENCY.
new text end

new text begin Subdivision 1. new text end

new text begin General duties and authorities. new text end

new text begin (a) The
Pollution Control Agency, in accordance with federal TMDL
requirements, shall: identify impaired waters and propose a
list of the waters for review and approval by the United States
Environmental Protection Agency; develop and approve TMDL's for
listed impaired waters and submit the approved TMDL's to the
United States Environmental Protection Agency for final
approval; and propose to delist waters from the United States
Environmental Protection Agency impaired waters list.
new text end

new text begin (b) A TMDL must include a statement of the facts and
scientific data supporting the TMDL and a list of potential
implementation options, including:
new text end

new text begin (1) a range of estimates of the cost of implementation of
the TMDL; and
new text end

new text begin (2) for point sources, the individual wasteload data and
the estimated cost of compliance addressed by the TMDL.
new text end

new text begin The implementation information does not need to be sent to the
United States Environmental Protection Agency for review.
new text end

new text begin Subd. 2. new text end

new text begin Administrative procedures for tmdl
approval. new text end

new text begin Before approving a TMDL, the agency shall give
written notice to the public of the proposed TMDL and provide a
30-day opportunity for submission of written comments. The
agency shall distribute the notice in the same manner as a
notice of a proposed permit is distributed under agency rules
and maintain a copy of the proposed TMDL on the agency's Web
site during the 30-day comment period. The approval of a TMDL
by the Pollution Control Agency is a final decision of the
agency under section 115.05, subdivision 11, clause (1), and is
subject to the contested case procedures of sections 14.57 to
14.62 in accordance with agency procedural rules. The agency
shall not submit an approved TMDL to the United States
Environmental Protection Agency until the time for commencing
judicial review has run or the judicial review process has been
completed. A TMDL is not subject to the rulemaking requirements
of chapter 14, including section 14.386.
new text end

new text begin Subd. 3. new text end

new text begin Consultation with third parties. new text end

new text begin The Pollution
Control Agency may consult with third parties to provide expert
scientific advice pursuant to section 114D.35, subdivision 2, or
with stakeholders pursuant to section 114D.35, subdivision 1, in
the course of its development of a TMDL. The Pollution Control
Agency may not delegate the development of a TMDL to a third
party. At all times, the Pollution Control Agency shall retain
the overall responsibility for the development of a TMDL,
including the scope of the TMDL, the work plan used to develop
the TMDL, and the schedule under which the TMDL is developed.
The Pollution Control Agency shall also supervise and monitor
all stages of the TMDL development process. This subdivision
does not limit the Pollution Control Agency's ability to hire
private consulting firms for technical work related to a portion
of the TMDL.
new text end

Sec. 5.

new text begin [114D.30] CLEAN WATER COUNCIL.
new text end

new text begin Subdivision 1. new text end

new text begin Creation; duties. new text end

new text begin A Clean Water Council
is created to advise on the administration and implementation of
this chapter and foster coordination and cooperation as
described in section 114D.20, subdivision 1. The council may
also advise on the development of appropriate processes for
expert scientific review as described in section 114D.35,
subdivision 2. The Pollution Control Agency shall provide
administrative support for the council with the support of other
member agencies. The members of the council shall elect a chair
from the nonagency members of the council.
new text end

new text begin Subd. 2. new text end

new text begin Membership; appointment. new text end

new text begin (a) The commissioners
of natural resources, agriculture, and the Pollution Control
Agency, and the executive director of the Board of Water and
Soil Resources or their designees are members of the council.
The governor shall appoint 13 additional nonagency members of
the council as follows:
new text end

new text begin (1) two members representing statewide farm organizations;
new text end

new text begin (2) two members representing business organizations;
new text end

new text begin (3) two members representing environmental organizations;
new text end

new text begin (4) one member representing soil and water conservation
districts;
new text end

new text begin (5) one member representing watershed districts;
new text end

new text begin (6) one member representing organizations focused on
improvement of Minnesota lakes or streams;
new text end

new text begin (7) one member representing an organization of county
governments;
new text end

new text begin (8) two members representing organizations of city
governments; and
new text end

new text begin (9) one member representing the Metropolitan Council
established under section 473.123.
new text end

new text begin (b) The members of the council appointed by the governor
are subject to the advice and consent of the senate.
new text end

new text begin Subd. 3. new text end

new text begin Terms; compensation; removal. new text end

new text begin The initial terms
of members representing state agencies and the Metropolitan
Council expire on the first Monday in January 2007. Thereafter,
the terms of members representing the state agencies and the
Metropolitan Council are four years and are coterminous with the
governor. The terms of other members of the council shall be as
provided in section 15.059, subdivision 2. Members may serve
until their successors are appointed and qualify. Compensation
and removal of council members is as provided in section 15.059,
subdivisions 3 and 4. A vacancy on the council may be filled by
the appointing authorities, as provided in subdivision 1, for
the remainder of the unexpired term.
new text end

new text begin Subd. 4. new text end

new text begin Implementation plan. new text end

new text begin The Clean Water Council
shall prepare a plan for implementation of this chapter. The
plan shall address general procedures and time frames for
implementing this chapter, and shall include a more specific
implementation work plan for the next fiscal biennium and a
framework for setting priorities to address impaired waters
consistent with section 114D.20, subdivisions 2 to 7. The
council shall issue the first implementation plan under this
subdivision by December 1, 2005, and shall issue a revised work
plan by December 1 of each even-numbered year thereafter.
new text end

new text begin Subd. 5. new text end

new text begin Recommendations on appropriation of funds. new text end

new text begin The
Clean Water Council shall recommend to the Pollution Control
Agency the manner in which money from the clean waters account
should be used for the purposes identified in section 114D.45,
subdivision 3, and make recommendations to the governor for
capital expenditures related to impaired waters. The council's
recommendations must be consistent with the purposes, policies,
goals, and priorities in sections 114D.05 to 114D.35, and shall
allocate adequate support and resources to identify impaired
waters, develop TMDL's, implement restoration of impaired
waters, and provide assistance and incentives to prevent waters
from becoming impaired and improve the quality of waters which
are listed as impaired but have no approved TMDL.
new text end

new text begin Subd. 6. new text end

new text begin Biennial report to legislature. new text end

new text begin By December 1
of each even-numbered year, the council shall submit a report to
the legislature on the activities for which money from the clean
waters account and capital expenditures have been or will be
spent for the current biennium, the activities for which money
from the account and capital expenditures are recommended to be
spent in the next biennium, and the impact on economic
development of the implementation of the impaired waters
program. The report due on December 1, 2014, must include an
evaluation of the progress made through June 30, 2014, in
implementing this chapter, the need for funding of future
implementation of those sections, and recommendations for the
sources of funding.
new text end

Sec. 6.

new text begin [114D.35] PUBLIC AND STAKEHOLDER PARTICIPATION;
SCIENTIFIC REVIEW; EDUCATION.
new text end

new text begin Subdivision 1. new text end

new text begin Public and stakeholder participation.
new text end

new text begin Public agencies involved in the implementation of this chapter
shall encourage participation by the public and stakeholders,
including local citizens, landowners and managers, and public
and private organizations, in the identification of impaired
waters, in developing TMDL's, and in planning and implementing
restoration of impaired waters. In particular, the Pollution
Control Agency shall make reasonable efforts to provide timely
information to the public and to stakeholders about impaired
waters that have been identified by the agency. The agency
shall seek broad and early public and stakeholder participation
in scoping the activities necessary to develop a TMDL, including
the scientific models, methods, and approaches to be used in
TMDL development, and to implement restoration pursuant to
section 114D.15, subdivision 7.
new text end

new text begin Subd. 2. new text end

new text begin Expert scientific advice. new text end

new text begin The Clean Water
Council and public agencies shall make use of available
expertise from educational, research, and technical
organizations, including the University of Minnesota and other
higher education institutions, to provide appropriate
independent expert advice on models, methods, and approaches
used in identifying impaired waters, developing TMDL's, and
implementing prevention and restoration.
new text end

new text begin Subd. 3. new text end

new text begin Education. new text end

new text begin The Clean Water Council shall
develop strategies for informing, educating, and encouraging the
participation of citizens, stakeholders, and others regarding
the identification of impaired waters, development of TMDL's,
and development and implementation of restoration for impaired
waters. Public agencies shall be responsible for implementing
the strategies.
new text end

Sec. 7.

new text begin [114D.45] CLEAN WATERS ACCOUNT.
new text end

new text begin Subdivision 1. new text end

new text begin Creation. new text end

new text begin The clean waters account is
created as an account in the environmental fund.
new text end

new text begin Subd. 2. new text end

new text begin Sources of revenue. new text end

new text begin The following revenues must
be deposited in the clean waters account:
new text end

new text begin (1) revenue from civil penalties collected under section
115.071, subdivision 3, paragraph (b); and
new text end

new text begin (2) interest accrued on the account.
new text end

new text begin Subd. 3. new text end

new text begin Purposes. new text end

new text begin The clean waters account is annually
appropriated to the Pollution Control Agency for the following
purposes:
new text end

new text begin (1) to provide grants, loans, and technical assistance to
public agencies and others who are participating in the process
of identifying impaired waters, developing TMDL's, implementing
restoration plans for impaired waters, and monitoring the
effectiveness of restoration;
new text end

new text begin (2) to support measures to prevent waters from becoming
impaired and to improve the quality of waters that are listed as
impaired but have no approved TMDL addressing the impairment;
new text end

new text begin (3) to support the efforts of public agencies associated
with individual sewage treatment systems; and
new text end

new text begin (4) to provide funds to state agencies to carry out their
responsibilities under this chapter.
new text end

Sec. 8.

Minnesota Statutes 2004, section 115.071,
subdivision 3, is amended to read:

Subd. 3.

Civil penalties.

new text begin (a) Except as provided in
paragraph (b), new text end any person who violates any provision of this
chapter or chapter 114C or 116, except any provisions of chapter
116 relating to air and land pollution caused by agricultural
operations which do not involve National Pollutant Discharge
Elimination System permits, or of (1) any effluent standards and
limitations or water quality standards, (2) any permit or term
or condition thereof, (3) any National Pollutant Discharge
Elimination System filing requirements, (4) any duty to permit
or carry out inspection, entry or monitoring activities, or (5)
any rules, stipulation agreements, variances, schedules of
compliance, or orders issued by the agency, shall forfeit and
pay to the state a penalty, in an amount to be determined by the
court, of not more than $10,000 per day of violation except that
if the violation relates to hazardous waste the person shall
forfeit and pay to the state a penalty, in an amount to be
determined by the court, of not more than $25,000 per day of
violation.

new text begin (b) Any person who violates any provision of this chapter
or chapter 114C or 116 that causes pollution of an impaired
water, as defined in section 114D.15, subdivision 5, except any
provisions of chapter 116 relating to air and land pollution
caused by agricultural operations that do not involve National
Pollutant Discharge Elimination System permits, or of:
new text end

new text begin (1) any effluent standards and limitations on water quality
standards;
new text end

new text begin (2) any permit or term or condition thereof;
new text end

new text begin (3) any National Pollutant Discharge Elimination System
filing requirements;
new text end

new text begin (4) any duty to permit or carry out inspection, entry, or
monitoring activities; or
new text end

new text begin (5) any rules, stipulation agreements, variances, schedules
of compliance, or orders issued by the agency, shall forfeit and
pay to the state a penalty, in an amount to be determined by the
court, of not more than $25,000 per day of violation except that
if the violation relates to hazardous waste, the person shall
forfeit and pay to the state a penalty, in an amount to be
determined by the court, of not more than $40,000 per day of
violation. Money recovered under this paragraph shall be
deposited in the clean waters account under section 114D.45.
new text end

new text begin (c) new text end In addition, in the discretion of the court, the
defendant may be required to:

deleted text begin (a) deleted text end new text begin (1) new text end forfeit and pay to the state a sum which will
adequately compensate the state for the reasonable value of
cleanup and other expenses directly resulting from unauthorized
discharge of pollutants, whether or not accidental; new text begin and
new text end

deleted text begin (b) deleted text end new text begin (2) new text end forfeit and pay to the state an additional sum to
constitute just compensation for any loss or destruction to
wildlife, fish or other aquatic life and for other actual
damages to the state caused by an unauthorized discharge of
pollutants.

new text begin (d) new text end As a defense to any of said damages, the defendant may
prove that the violation was caused solely by (1) an act of God,
(2) an act of war, (3) negligence on the part of the state of
Minnesota, or (4) an act or failure to act which constitutes
sabotage or vandalism, or any combination of the foregoing
clauses.

new text begin (e) new text end The civil penalties and damages provided for in this
subdivision may be recovered by a civil action brought by the
attorney general in the name of the state.

Sec. 9.

new text begin [446A.073] CLEAN WATERS PHOSPHORUS REDUCTION
GRANTS.
new text end

new text begin Subdivision 1. new text end

new text begin Creation of fund; appropriation. new text end

new text begin The
authority shall establish a clean waters capital improvement
fund and shall make grants from the fund as provided in this
section. Money in the clean waters capital improvement fund,
including interest earned, is appropriated to the authority for
the purposes of this section.
new text end

new text begin Subd. 2. new text end

new text begin Grants. new text end

new text begin The authority shall award grants from
the clean waters capital improvement fund to governmental units
for the capital costs of wastewater treatment facility projects
or a portion thereof that will reduce the discharge of total
phosphorus from the facility to one milligram per liter or
less. A project is eligible for a grant if it meets the
following requirements:
new text end

new text begin (1) the applicable phosphorus discharge limit is
incorporated in a permit issued by the agency for the wastewater
treatment facility on or after March 28, 2000, or the grantee
agrees to comply with the applicable limit as a condition of
receiving the grant;
new text end

new text begin (2) the governmental unit has submitted a facilities plan
for the project to the agency and a grant application to the
authority on a form prescribed by the authority; and
new text end

new text begin (3) the agency has approved the application and facilities
plan, and certified the eligible costs for the project to the
authority.
new text end

new text begin Subd. 3. new text end

new text begin Eligible capital costs. new text end

new text begin Eligible capital costs
for phosphorus reduction grants under subdivision 4, paragraph
(a), include the as-bid construction costs and engineering
planning and design costs. Eligible capital costs for
phosphorus reduction grants under subdivision 4, paragraph (b),
include the final, incurred construction, engineering, planning,
and design costs.
new text end

new text begin Subd. 4. new text end

new text begin Grant amounts and priorities. new text end

new text begin (a) Priority must
be given to projects that start construction on or after July 1,
2005. If a facility's plan for a project is approved by the
agency before July 1, 2009, the amount of the grant is 75
percent of the eligible capital cost of the project. If a
facility's plan for a project is approved by the agency on or
after July 1, 2009, the amount of the grant is 50 percent of the
eligible capital cost of the project. Priority in awarding
grants under this paragraph must be based on the date of
approval of the facility's plan for the project.
new text end

new text begin (b) Projects that meet the eligibility requirements in
subdivision 2 and have started construction before July 1, 2005,
are eligible for grants to reimburse 75 percent of the eligible
capital cost of the project, less any amounts previously
received in grants from other sources. Application for a grant
under this paragraph must be submitted to the agency no later
than June 30, 2007. Priority for award of grants under this
paragraph must be based on the date of agency approval of the
application for the grant.
new text end

new text begin (c) In each fiscal year that money is available for grants,
the authority shall first award grants under paragraph (a) to
projects that met the eligibility requirements of subdivision 2
by May 1 of that year. The authority shall use any remaining
money available that year to award grants under paragraph (b).
Grants that have been approved but not awarded in a previous
fiscal year carry over and must be awarded in subsequent fiscal
years in accordance with the priorities in this paragraph.
new text end

new text begin (d) Disbursements of grants under this section by the
authority to recipients must be made for eligible project costs
as incurred by the recipients, and must be made by the authority
in accordance with the project financing agreement and
applicable state law.
new text end

new text begin Subd. 5. new text end

new text begin Fees. new text end

new text begin The authority may charge the grant
recipient a fee for its administrative costs, not to exceed
one-half of one percent of the grant amount, to be paid upon
execution of the grant agreement.
new text end

Sec. 10.

new text begin [446A.074] SMALL COMMUNITY WASTEWATER TREATMENT
LOAN PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Creation of fund. new text end

new text begin The authority shall
establish a small community wastewater treatment fund and shall
make loans from the fund as provided in this section. Money in
the fund is annually appropriated to the authority and does not
lapse. The fund shall be credited with all loan repayments and
investment income from the fund and servicing fees assessed
under section 446A.04, subdivision 5. The authority shall
manage and administer the small community wastewater treatment
fund, and for these purposes, may exercise all powers provided
in this chapter.
new text end

new text begin Subd. 2. new text end

new text begin Loans. new text end

new text begin The authority shall award loans to
governmental units from the small community wastewater treatment
fund for projects to replace noncomplying individual sewage
treatment systems with a community wastewater treatment system
or systems meeting the requirements of section 115.55. A
governmental unit receiving a loan from the fund shall own the
community wastewater 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 assure proper operation of the systems.
new text end

new text begin Subd. 3. new text end

new text begin Project priority list. new text end

new text begin Governmental units
seeking loans from the small community wastewater treatment loan
program shall first submit a project proposal to the agency. A
project proposal shall include a compliance determination for
all individual sewage treatment systems in the project area.
The agency shall rank project proposals on its project priority
list used for the water pollution control revolving fund under
section 446A.07.
new text end

new text begin Subd. 4. new text end

new text begin Loan applications. new text end

new text begin Governmental units with
projects on the project priority list shall submit applications
to the authority on forms prescribed by the authority. The
application shall include:
new text end

new text begin (1) a list of the individual sewage treatment systems
proposed to be replaced over a period of up to three years;
new text end

new text begin (2) a project schedule and cost estimate for each year of
the project;
new text end

new text begin (3) a financing plan for repayment of the loan; and
new text end

new text begin (4) a management plan providing for the inspection,
maintenance, and repairs necessary to assure proper operation of
the systems.
new text end

new text begin Subd. 5. new text end

new text begin Loan awards. new text end

new text begin The authority shall award loans to
governmental units with approved loan applications based on
their ranking on the agency's project priority list. The loan
amount 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 agreement
meeting the terms and conditions in subdivision 6. A
governmental unit receiving a loan under a multiyear commitment
shall have priority for additional loan funds in subsequent
years.
new text end

new text begin Subd. 6. new text end

new text begin Loan terms and conditions. new text end

new text begin Loans from the small
community wastewater treatment fund shall comply with the
following terms and conditions:
new text end

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

new text begin (2) loans shall carry an interest rate of one percent;
new text end

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

new text begin (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
new text end

new text begin (5) each property owner to be served by a community
wastewater treatment system under this program must provide an
easement to the governmental unit to allow access to the system
for management and repairs.
new text end

new text begin Subd. 7. new text end

new text begin Special assessment deferral. new text end

new text begin (a) A governmental
unit receiving a loan under this section that levies special
assessments to repay the loan may defer payment of the
assessments under the provisions of sections 435.193 to 435.195.
new text end

new text begin (b) A governmental unit that defers payment of special
assessments for one or more properties under paragraph (a) may
request deferral of that portion of the debt service on its
loan, and the authority shall accept appropriate amendments to
the general obligation note of the governmental unit. If
special assessment payments are later received from properties
that received a deferral, the funds received shall be paid to
the authority with the next scheduled loan payment.
new text end

new text begin Subd. 8. new text end

new text begin Eligible costs. new text end

new text begin Eligible costs for small
community wastewater treatment loans shall include the costs of
planning, design, construction, legal fees, administration, and
land acquisition.
new text end

new text begin Subd. 9. new text end

new text begin Disbursements. new text end

new text begin Loan disbursements by the
authority under this section must be made for eligible project
costs as incurred by the recipients, and must be made in
accordance with the project loan agreement and applicable state
law.
new text end

new text begin Subd. 10. new text end

new text begin Audits. new text end

new text begin A governmental unit receiving a loan
under this section must annually provide to the authority for
the term of the loan a copy of its annual independent audit or,
if the governmental unit is not required to prepare an
independent audit, a copy of the annual financial reporting form
it provides to the state auditor.
new text end

Sec. 11. new text begin APPROPRIATIONS; PUBLIC FACILITIES AUTHORITY.
new text end

new text begin (a) $....... is appropriated from the bond proceeds fund to
the Public Facilities Authority. Of this amount, $....... is
for deposit in the clean waters capital improvements fund for
grants under Minnesota Statutes, section 446A.073; $....... is
for deposit in the small community wastewater treatment fund for
loans under Minnesota Statutes, section 446A.074; and $.......
is for deposit in the water pollution control revolving fund
under Minnesota Statutes, section 446A.07, for wastewater
treatment and storm water projects. Money appropriated under
this section is available until spent.
new text end

new text begin (b) To provide the money appropriated in this section from
the bond proceeds fund, the commissioner of finance shall sell
and issue bonds of the state in an amount up to $......., in the
manner, upon the terms, and with the effect prescribed by
Minnesota Statutes, sections 16A.631 to 16A.675, and by the
Minnesota Constitution, article XI, sections 4 to 7.
new text end