Economic Recovery Funding Drinking Water Infrastructure Projects February 2009

1. Economic Recovery FundingDrinking Water Infrastructure ProjectsFebruary 2009 California Department of Public Health Safe Drinking Water State Revolving Fund

2. Economic Recovery Bill Pending President Obama’s signature sometime in February, 2009, the Recovery bill will: • Address the nation’s need to bolster the economy and create jobs. • Provide $2.0 billion for Safe Drinking Water State Revolving Funds (SDWSRF) nationally; total allotment could increase. • Provide California an estimated amount in excess of ~$160 million; total allotment could increase. • Will focus on “shovel-ready” projects as the priority

3. What are we doing? • What is the Federal Government doing? • What is CDPHdoing? • Letter going out (2nd week of Feb.) to all Public Water Systems explaining CDPH process for distributing Economic Recovery Funding. • What should Public Water Systems be doing? • Identify projects that are "ready to proceed"

4. Possible Stimulus Bill Provisions • Drinking water funds will be allocated through the SDWSRF program • House Bill - Formula grants shall be awarded to states not later than 30 days after date of enactment or funds become available. • House Bill - Preference shall be given to activities started quickly including a goal of using at least 50% of funds on projects that can begin within 120 days after enactment. Max job creation and economic benefit. • Senate Bill - Priority for funding shall be allocated to projects that are ready to proceed to construction within 180 days of enactment.

5. Possible Stimulus Bill provisions…. • House Bill - Remain available for obligation until Sept. 30, 2010, unless expressed otherwise in Act. (Sec. 1105) • Senate Bill - No part of any appropriation shall remain available for obligation beyond the current fiscal year unless expressly so provided herein (Sec. 1602) • House Bill - Recipients shall enter into contracts or binding commitments within 1 year of enactment of Act for 50% of funds awarded and within 2 years of Act for all remaining funds. • No State matching funds are required

6. Possible Stimulus Bill provisions…. • Senate Bill - Not less than 15% of the funds appropriated shall be designated for green infrastructure, water efficiency improvements or other environmentally innovative projects. • Allows for State administrative costs to implement program • Allows for subsidies: • House Bill - 50% of cap grant shall be used for “additional subsidization,” including forgiveness of principal, negative interest loans and grants, to municipalities • Senate Bill is silent on subsidization

7. Possible Stimulus Bill provisions…. • Current CA SDWSRF program allows for: • 0% interest and principle forgiveness (80% of project cost) for disadvantaged communities • <80% of statewide MHI (<$46,731 for 2009) • Current interest rate for 2009 = 2.5017%

8. Eligible Projects for this Funding Only projects that are “ready to proceed”: • Complete application must be submitted by deadline specified by CDPH (June 2009?). • Must include final plans and specifications. • Must comply with environmental requirements at the time of application : • Must be determined to be NEPA excluded AND CEQA exempt; OR • All final CEQA documents and filings must be complete, and project must be adopted and approved by the Lead Agency. • Plus, applicant must be able to complete the federal requirements of Section 7 of the Endangered Species Act and Section 106 of the National Historic Preservation Act within 60 days.

9. Additional Project Information • Funding agreement cannot be issued by CDPH and construction cannot begin until final environmental clearance. • Construction must begin within 60 days of executed funding agreement. • Water system must have adequate Technical, Managerial, and Financial capacity. • Our CDPH District Office can provide information on this requirement. • Any Proposition 218 requirement for a rate increase must be met prior to issuance of a funding agreement by CDPH.

10. SDWSRF Economic RecoveryFunding Process • Applicant submits a pre-application for Economic Recovery Funding (ER$) – Open now till Feb 27, 2009 on CDPH web site • CDPH reviews and ranks ER$ pre-apps • CDPH publishes draft Project Priority List • CDPH invites projects to submit complete application • CDPH evaluates funding application • CDPH issues funding agreement – starting summer of 2009

11. SDWSRF ER$ Project Priority List • Only projects that are ready to proceed will be included. • Projects ranked into health-based categories • Ranking within each category is based on: • Median household income • Consolidation of systems • Population served.

12. Funding Applications CDPH invites projects from PPL based on available funding. • Applicant will have 60 days to submit a completed application. • There will be no extensions to this deadline. • CDPH will process applications in the order received • CDPH will continue to process applications until all funds have been allocated. • CDPH to issue funding agreement within 60 days of determination of project eligibility and funding amount. • The funding application and required documents will be posted on our website in February.

13. Upcoming Workshops/Events 2009 California Financing Coordinating Committee (CFCC) Funding Fairs February 3, 2009 – Chino – Inland Empire Utilities Agency February 5, 2009 – Bakersfield – UC Merced, Bakersfield Center March 10, 2009 – Eureka – City of Eureka April 2, 2009 – Merced – UC Cooperative Extension May 7, 2009 – Sacramento – Cal Environmental Protection Agency For location information, visit the CFCC website:www.cfcc.ca.gov

14. Contact/Resources Information • SDWSRF program information: http://www.cdph.ca.gov/services/funding/pages/SRF.aspx • Email to request current program announcements: contact SDWSRF@cdph.ca.gov • SDWSRF Economic Recovery Pre-application • http://www.cdph.ca.gov/certlic/drinkingwater/Pages/UniversalPreapplication.aspx