SF 762

3rd Engrossment - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to the environment; creating the Clean Water
Legacy 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 Laws 2005, chapter 20,
article 1, section 39; 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 Water Legacy Act."
new text end

Sec. 2.

new text begin [114D.10] LEGISLATIVE PURPOSE AND FINDINGS.
new text end

new text begin Subdivision 1. new text end

new text begin Purpose. new text end

new text begin The purpose of the Clean Water
Legacy Act is to protect, restore, and preserve the quality of
Minnesota's surface waters by providing authority, direction,
and resources to achieve and maintain water quality standards
for surface waters as required by section 303(d) of the federal
Clean Water Act, United States Code, title 33, section 1313(d),
and applicable federal regulations.
new text end

new text begin Subd. 2. new text end

new text begin Findings. new text end

new text begin The legislature finds that:
new text end

new text begin (1) there is a close link between protecting, restoring,
and preserving the quality of Minnesota's surface waters and the
ability to develop the state's economy, enhance its quality of
life, and protect its human and natural resources;
new text end

new text begin (2) achieving the state's water quality goals will require
long-term commitment and cooperation by all state and local
agencies, and other public and private organizations and
individuals, with responsibility and authority for water
management, planning, and protection; and
new text end

new text begin (3) all persons and organizations whose activities affect
the quality of waters, including point and nonpoint sources of
pollution, have a responsibility to participate in and support
efforts to achieve the state's water quality goals.
new text end

Sec. 3.

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 33, 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 Third-party tmdl. new text end

new text begin "Third-party TMDL" means a
TMDL that is developed by a qualified public agency other than
the Pollution Control Agency consistent with the goals,
policies, and priorities in section 114D.20.
new text end

new text begin Subd. 10. 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. 11. 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. 4.

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. 5.

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.
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 Third-party tmdl development. new text end

new text begin The Pollution
Control Agency may enter agreements with any qualified public
agency setting forth the terms and conditions under which that
entity is authorized to develop a third-party TMDL. In
determining whether the public agency is qualified to develop a
third-party TMDL, the Pollution Control Agency shall consider
the technical and administrative qualifications of the public
agency and shall avoid any potential organizational conflict of
interest, as defined in section 16C.02, subdivision 10a, of the
public agency with respect to the development of the third-party
TMDL. A third-party TMDL is subject to modification and
approval by the Pollution Control Agency, and must be approved
by the Pollution Control Agency before it is submitted to the
United States Environmental Protection Agency. The Pollution
Control Agency shall consider authorizing the development of
third-party TMDL's consistent with the goals, policies, and
priorities determined under section 116.384.
new text end

Sec. 6.

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 The commissioners of
natural resources, agriculture, and the Pollution Control
Agency, and the executive director of the Board of Water and
Soil Resources shall appoint one person from their respective
agency to serve as a member of the council. Nineteen additional
nonagency members of the council shall be appointed as follows:
new text end

new text begin (1) two members representing statewide farm organizations,
appointed by the governor;
new text end

new text begin (2) one member representing business organizations,
appointed by the governor;
new text end

new text begin (3) one member representing environmental organizations,
appointed by the governor;
new text end

new text begin (4) one member representing soil and water conservation
districts, appointed by the governor;
new text end

new text begin (5) one member representing watershed districts, appointed
by the governor;
new text end

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

new text begin (7) two members representing an organization of county
governments, appointed by the governor;
new text end

new text begin (8) two members representing organizations of city
governments, appointed by the governor;
new text end

new text begin (9) one member representing the Metropolitan Council
established under section 473.123, appointed by the governor;
new text end

new text begin (10) one township officer, appointed by the governor;
new text end

new text begin (11) one member of the house of representatives, appointed
by the speaker;
new text end

new text begin (12) one member of the senate, appointed by the majority
leader;
new text end

new text begin (13) one member representing the University of Minnesota or
a Minnesota state university, appointed by the governor;
new text end

new text begin (14) one member representing the interests of rural
counties, appointed by the governor;
new text end

new text begin (15) one member representing the interests of counties in
the seven-county metropolitan area, appointed by the governor;
and
new text end

new text begin (16) one member representing the interests of tribal
governments, appointed by the governor.
new text end

new text begin The members of the council appointed by the governor are
subject to the advice and consent of the senate. At least six
of the members appointed by the governor must reside in the
seven-county metropolitan area.
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 recommend a plan for implementation of this chapter. The
recommended 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 recommended plan under this
subdivision by December 1, 2005, and shall issue a revised 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 governor the manner
in which money from the clean water legacy account should be
appropriated for the purposes identified in section 114D.45,
subdivision 3. 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
water legacy account has been or will be spent for the current
biennium, the activities for which money from the account is
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. 7.

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. 8.

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

new text begin Subdivision 1. new text end

new text begin Creation. new text end

new text begin The clean water legacy account
is created as an account in the environmental fund. Money in
the account must be made available for the implementation of
this chapter and sections 446A.073, 446A.074, and 446A.075,
without supplanting or taking the place of any other funds which
are currently available or may become available from any other
source, whether federal, state, local, or private, for
implementation of those sections.
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 water legacy account:
new text end

new text begin (1) money transferred to the account; 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 Subject to appropriation by the
legislature, the clean water legacy account may be spent 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 provide grants and loans for wastewater and storm
water treatment projects through the Public Facilities
Authority;
new text end

new text begin (4) to support the efforts of public agencies associated
with individual sewage treatment systems and financial
assistance for upgrading and replacing the systems; and
new text end

new text begin (5) to provide funds to state agencies to carry out their
responsibilities under this chapter.
new text end

Sec. 9.

new text begin [446A.073] CLEAN WATER LEGACY 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 water legacy capital
improvement fund and shall make grants from the fund as provided
in this section. Money in the clean water legacy 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 water legacy 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, the grantee
agrees to comply with the applicable limit as a condition of
receiving the grant, or the grantee made improvements to a
wastewater treatment facility on or after March 28, 2000, that
include infrastructure to reduce the discharge of total
phosphorus to one milligram per liter or less;
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 not
to 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.

Laws 2005, chapter 20, article 1, section 39, is
amended to read:

Sec. 39.

new text begin [446A.073] TOTAL MAXIMUM DAILY LOAD GRANTS.
new text end

Subdivision 1.

Program established.

The authority must
make grants to municipalities to cover up to one-half the cost
of wastewater treatment new text begin or stormwater new text end projects made necessary by
wasteload reductions under total maximum daily load plans
required by section 303(d) of the federal Clean Water Act,
United States Code, title 33, section 1313(d).

Subd. 2.

Grant application.

Application for a grant must
be made to the authority on forms prescribed by the authority
for the total maximum daily load grant program, with additional
information as required by the authority. In accordance with
section 116.182, the Pollution Control Agency shall:

(1) calculate the essential project component percentage,
which must be multiplied by the total project cost to determine
the eligible project cost; and

(2) review and certify approved projects to the authority.

Subd. 3.

Project priorities.

When money is appropriated
for grants under this program, the authority shall reserve money
for projects in the order that their total maximum daily load
plan was approved by the United States Environmental Protection
Agency and in an amount based on their most recent cost
estimates submitted to the authority or the as-bid costs,
whichever is less.

Subd. 4.

Grant approval.

The authority must make a grant
to a municipality, as defined in section 116.182, subdivision 1,
only after:

(1) the commissioner of the Minnesota 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;

(2) the Environmental Protection Agency has approved the
plan;

(3) a municipality affected by the plan has estimated the
cost to it of wastewater treatment projects necessary to comply
with the point source wasteload allocation;

(4) the Pollution Control Agency has approved the cost
estimate; and

(5) the authority has determined that the additional
financing necessary to complete the project has been committed
from other sources.

Subd. 5.

Grant disbursement.

Disbursement of a grant
must be made for eligible project costs as incurred by the
municipality and in accordance with a project financing
agreement and applicable state and federal laws and rules
governing the payments.

Sec. 12. new text begin APPROPRIATIONS.
new text end

new text begin Subdivision 1. new text end

new text begin General provisions. new text end

new text begin The appropriations in
this section are from the environmental fund and are available
for the fiscal years ending June 30, 2006, and June 30, 2007.
Any money remaining after the first year of the biennium is
available for the second year. Appropriations in this section
that are encumbered under contract, including grant contract, on
or before June 30, 2007, are available until June 30, 2009.
new text end

new text begin Subd. 2. new text end

new text begin Pollution control agency. new text end

new text begin The following amounts
are appropriated to the Pollution Control Agency for the
purposes stated:
new text end

new text begin (1) $4,125,000 in fiscal year 2006 and $1,669,000 in fiscal
year 2007 are for statewide assessment of surface water quality
and trends; of these amounts, up to $1,960,000 in fiscal year
2006 and $793,000 in fiscal year 2007 are available for grants
or contracts to support citizen monitoring of surface waters;
and
new text end

new text begin (2) $3,290,000 in fiscal year 2006 and $1,331,000 in fiscal
year 2007 are to develop TMDL's for waters listed on the United
States Environmental Protection Agency approved 2004 impaired
waters list; of this appropriation, up to $1,119,000 in fiscal
year 2006 and $453,000 in fiscal year 2007 are available for
grants or contracts to develop TMDL's.
new text end

new text begin Subd. 3. new text end

new text begin Agriculture department. new text end

new text begin The following amounts
are appropriated to the Department of Agriculture for the
purposes stated:
new text end

new text begin (1) $2,300,000 in fiscal year 2006 is for the agricultural
best management practices loan program under Minnesota Statutes,
section 17.117; of this amount, $2,100,000 in fiscal year 2006
is available for pass-through to local governments and lenders
for low-interest loans;
new text end

new text begin (2) $800,000 in fiscal year 2006 is to expand technical
assistance to producers and conservation professionals on
nutrient and pasture management; target practices to sources of
water impairments; coordinate federal and state farm
conservation programs to fully utilize federal conservation
funds; and expand conservation planning assistance for
producers; of this amount, $210,000 in fiscal year 2006 is
available for grants or contracts to develop nutrient and
conservation planning assistance information materials; and
new text end

new text begin (3) $800,000 in fiscal year 2006 is for research,
evaluation, and effectiveness monitoring of agricultural
practices in restoring impaired waters; of this amount, $600,000
in fiscal year 2006 is available for grants or contracts for
research, evaluations, and effectiveness monitoring of
agricultural practices in restoring impaired waters, including
on-farm demonstrations.
new text end

new text begin Subd. 4. new text end

new text begin Board of water and soil resources. new text end

new text begin The
following amounts are appropriated to the Board of Water and
Soil Resources for restoration and prevention actions as
described in Minnesota Statutes, section 114D.20, subdivisions 6
and 7:
new text end

new text begin (1) $1,807,000 in fiscal year 2006 is for targeted nonpoint
restoration cost-share and incentive payments; of this amount,
up to $1,713,000 in fiscal year 2006 is available for grants to
soil and water conservation districts through the state
cost-share program authorized under Minnesota Statutes, section
103C.501;
new text end

new text begin (2) $1,085,000 in fiscal year 2006 is for targeted nonpoint
technical and engineering assistance for restoration activities;
of this amount, up to $1,022,000 in fiscal year 2006 is
available for grants to soil and water conservation districts,
watershed management organizations, or counties to support
implementation of nonpoint restoration activities;
new text end

new text begin (3) $63,000 in fiscal year 2006 is for reporting and
evaluation of applied soil and water conservation practices;
new text end

new text begin (4) $755,000 in fiscal year 2006 is for grants to counties
for implementation of county individual sewage treatment systems
programs through the local water resources protection and
management program under Minnesota Statutes, section 103B.3369;
new text end

new text begin (5) $471,000 in fiscal year 2006 is for base and challenge
grants to support nonpoint source protection activities related
to lake and river protection and management through the local
water resources protection and management program under
Minnesota Statutes, section 103B.3369; and
new text end

new text begin (6) $755,000 in fiscal year 2006 is for grants to soil and
water conservation districts for streambank, stream channel,
lakeshore, and roadside protection and restoration projects
through the state-cost share program under Minnesota Statutes,
section 103C.501.
new text end

new text begin Subd. 5. new text end

new text begin Public facilities authority. new text end

new text begin $15,249,000 in
fiscal year 2006 is appropriated to the Public Facilities
Authority; of this amount, $6,131,000 in fiscal year 2006 is for
deposit in the clean water legacy capital improvements fund for
grants under Minnesota Statutes, section 446A.073; $1,441,000 in
fiscal year 2006 is for deposit in the small community
wastewater treatment fund for loans under Minnesota Statutes,
section 446A.074; and $7,677,000 in fiscal year 2006 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
subdivision does not cancel and is available until expended.
new text end

Sec. 13. new text begin REVISOR'S INSTRUCTION.
new text end

new text begin The revisor of statutes shall renumber the section coded as
Minnesota Statutes, section 446A.073, as Minnesota Statutes,
section 446A.075.
new text end