Thursday
March 20, 1997
Part X

Environmental
Protection Agency
Rural Communities Hardship Grants
Program Implementation Guidelines;
Notice
    /.
                          13521

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Federal Register / Vol. 62, No. 54 / Thursday.  March 20. 1997  / Notices
ENVIRONMENTAL PROTECTION
AGENCY
IFRL-5711-S1

Guidelines for Implementing the
Hardship Grants Program for Rural
Communities

ACTION: Notice of Availability of the
Hardship Grants Program for Rural
Communities.	

SUMMARY: The Environmental Protection
Agency is publishing the final
Guidelines for Implementing the
Hardship Grants Program for Rural
Communities, including the funding
allotment (Catalogue of Domestic
Federal Assistance #66.470)
ADDRESSES: Write to Stephanie vonFeck
(4204), Environmental Protection
Agency, 401 M Street SW, Washington,
DC 20460, or via Internet at
vonfeck^tephanle®epamail.epa.gov for
copies of the final Guidelines.
FOR FURTHER INFORMATION CONTACT:
Stephanie vonFeck (4204),
Environmental Protection Agency, 401
M Street SW, Washington, DC 20460,
(202)260-2268.
SUPPLEMENTARY INFORMATION: These
Guidelines implement a $50 million
grant program contained in the
Omnibus Consolidated Rescissions and
Appropriations Act of 1996 (Pub.L. 104-
134). The Agency will make grants to
States, which In turn can provide
assistance to Improve wastewater
treatment services in poor, rural
communities with populations of 3,000
or fewer where such services are
currently inadequate. The Hardship
Grants Program for Rural Communities
will be coordinated with the Clean
Water State Revolving Fund (SRF)
program and in accordance with the
SRF program regulations at 40 CFR part
35, subpart K and existing Agency grant
regulations and procedures, including
40 CFR part 31.
  The Hardship Grants Program for
Rural Communities may be subject to
your State's intergovernmental review
process under Executive Order 12372,
and/or the consultation requirements of
Section 204, Demonstration Cities and
Metropolitan Development Act of 1966,
42 U.S.C. 3334 (the Act)1. Applicants
must contact their State's Single Point of
Contact (SPOC) for intergovernmental
reviewas early as possible to find out
whether Hardship grant applications
(CFDA #66.470} are subject to the State's
Executive Order 12372 review process
and, if so, what material must be
submitted to the SPOC for review. If the
application is for a community within a
"metropolitan area" as that term is
                    defined at 42 U.S.C. 3338(4), then the
                    requirements of the Act are applicable.
                    You must notify area-wide metropolitan
                    or regional planning agencies and or
                    general government units authorized to
                    govern planning for the locale of your
                    project of your intended application.
                    SPOCs and other reviewers should send
                    their comments concerning Hardship
                    Grant applications to the appropriate
                    Regional Stzite Revolving Fund
                    Coordinator no later than 60 days after
                    receipt of am application and other
                    required material for review. In
                    accordance with 40 C.F.R. 29.8(c) a 60
                    day review Js mandatory for projects
                    subject to the Act.
                      Under 5 U.S.C. 801(a)(l)(A)i asadded
                    by the Small Business Regulatory
                    Enforcement Fairness Act of 1996, EPA
                    submitted a  report containing this
                    document and other required
                    information  to the U.S. Senate, the U.S.
                    House of Representatives and the
                    Comptroller General of the General
                    Accounting  Office prior to publication
                    of this document In today's Federal ,
                    Register. This document is not a "major
                    rule" as defined by 5 U.S.C. 804(2).
                      Dated: March 17,1997.
                    Dana Minerva,
                    Acting Assistant Administrator.
                    Appendix—Hardship Grants Program
                    for Rural Communities
                    Background
                      On May. 16,1995, the House passed
                    the Clean Water Amendments of 1995
                    (H.R. 961), a bill to reauthorize the
                    Clean Water Act. Section 102(d) of this
                    bill authorizes $50 million for each of
                    Fiscal Years! 1996 through 2000 for
                    grants to Suites, which the States in turn
                    can use to provide assistance for the
                    wastewater needs of poor, rural.   ,   .
                    communities. Although no further
                    • action was taken on H.R. 961, the
                    Omnibus Consolidated Rescissions and
                    Appropriations Act of 1996 (Pub. L.
                    104-134), v/hich the President signed
                    into law on  April 26,1996, provided
                    $50 million for these grants in FY 1996,
                    stating that  they are to be used in
                    accordance  with section 102(d) of H.R.
                    961. This sum is to be taken from the
                    $1.3485 billion reserved for
                    capitalization grants to State Revolving
                    Funds (SRF) under title VI of the Clean
                    Water Act.
                      Section 102(d) of the House Clean
                    Water Act reauthorization bill (H.R. 961)
                    reads, in pertinent part:
                      fT)he Administrator may make grants to
                    States to provide assistance for planning,'
                    design, and construction of publicly owned
                    treatment works and alternative wastewater
                    treatment systems to provide wastewater
                    services' to rural communities of 3,000 or less
that are npt currently served by any sewage
collection or wastewater treatment system
and are severely economically
disadvantaged, as determined by the
Administrator.

  The relevant clause in the "State and
Tribal Assistance Grants" language of
the Omnibus Appropriations Act reads:
  Provided Further, That of the funds made
available under this heading for
capitalization grants for State Revolving
Funds under title VI of the Federal Water
Pollution Control Act, as amended,
$50,000,000 shall be for wastewater
treatment in impoverished communities
pursuant to section 102(d) of H.R. 961 as
approved by the United States House of
•Representatives on May 16,1995 ...

  Although the legislative history to
H.R. 961 does offer some instruction on
how to define a "severely economically
. disadvantaged" community, additional
documented direction from Congress
about this new program is scant
(Attachment A contains excerpts from
both the legislative history to section
102 and the Omnibus Appropriations
Act provision). In the absence of
detailed guidance from Congress, the
Agency plans to administer this
program in concert with existing
programs and procedures to the
maximum extent possible.

Basic Principles for Administering
Rural Community Hardship Grants

  EPA Regions will be responsible for
awarding grants to the States, pursuant -
to a delegation of authority signed by
the Administrator  (Attachment B).
States will make grant awards to
individual communities or projects or
will provide technical assistance to
qualifying communities. The award of
grants or the provision of technical
assistance by a State to benefit
qualifying communities will be referreST
to  in these guidelines as hardship
assistance. The definition of technical
assistance is provided under the
 heading "Eligible Projects".
   Except as described in the following
 section, the Agency will administer the
 rural community hardship grants in
 conjunction with the Clean Water State
 Revolving Fund program (CW SRF),
 because the CW SRF capitalization grant
 appropriation is the source for these
 funds and because the program provides
 an established funding mechanism in
 each State. By combining CW SRF loans
 and grants, more qualifying
 communities will  benefit from the
 limited funding that is available. The
 communities would also continue to
 have a stake in their projects, and
 thereby an incentive to keep project
 costs low.

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                   Federal Register  /  Vol. 62, No. 54  / Thursday,  March 20, 1997 / Notices
                                                                     13523
   In addition to the CW SRF
capitalization grant. States will be
awarded a separate grant consisting of
funds which can be awarded as
hardship assistance to qualifying
communities. These funds are in.
addition to the CW SRF capitalization
grant awarded to the State.
Communities that apply for CW SRF
loans and that qualify according to the
criteria established in these guidelines
and any additional State guidelines
would then be able to receive hardship
assistance in an amount that would
make that CW SRF loan affordable.
   The loan amount must account for at
least 15 percent of the CW SRF-eligible
cost of the project before the Agency
will consider it an SRF project.
Otherwise, the project will be governed
by the guidelines described under the
following heading below: "Projects
receiving less than 15 percent in SRF
funding or hardship assistance only".
All communities seeking hardship
assistance must apply for an SRF loan.
The State will then determine the
appropriate mix of hardship grant and
SRF loan funds.
   Administering this program in       '
conjunction with the CW SRF program
has a number of other advantages. The
approach will encourage communities
to move forward with needed project
construction, rather than wait to receive
grant funding for the entire cost of those
projects. Projects in communities that
receive hardship assistance will receive
public review and approval because
they will be listed oft the State's CW
SRF Intended Use Plan (ItJP). These
projects will also undergo an
environmental review, under State
Environmental Review Procedures
(SERF) established for the CW SRF
program, and will comply with other.
SRF requirements which are more
streamlined than the requirements that
apply to projects funded with direct
Federal grants. For example, compliance
with cross-cutting Federal
environmental authorities can be
accomplished in conjunction with the
SERF. A listing of cross-cutting Federal
authorities currently applicable in the
CW SRF program is attached
{Attachment C).
  EPA's general grant regulations at 40
CFR part 31 and other Agency
regulations that apply to grant recipients
(e.g., 40 CFR part 32, debarment,
suspension, and drug-free workplace
requirements), will apply to the State as
the grant recipient, in the same manner
as they apply to the State as the
recipient of CW SRF capitalization
grants. Because projects receiving
hardship assistance will be projects
listed on the State's CW SRF IUP and
 will also be receiving SRF loans, the
 States must follow the Agency's SRF
 regulations at 40 CFR part 35, stibpart K,
 with respect to the recipients of that
 assistance. The CW SRF regulations
 prescribe rules for drawing cash and for
 the specific types of assistance CW SRF
 can provide. The rules for drawing cash
 for hardship assistance are described
 under the heading "Allocation of grant
 funds" below.
   In addition to hardship assistance for
 rural communities described in these
 guidelines, there are a number of other
 Federal programs that provide loan and
 grant assistance for the  wastewater
 needs  of rural communities. The water
 and wastewater loan and grant program
 administered by USDA's Rural Utility
 Service and the Department of Housing
 and Urban Development's Community
 Development Block Grants are just two
 examples. Often, these other Federal
 programs can provide assistance for
 costs that would be ineligible under the
 statutory provisions being implemented
 in these guidelines (e.g., indoor
 plumbing may be funded by CDBG
 funds  in limited circumstances). The
 Agency expects that State officials will
 take these other programs' benefits into
 account in devising the most effective
 assistance package for a rural
 community.
 Projects Receiving Less Than 15 Percent
 in SRF Funding or Hardship Assistance
 Only
'   If a qualifying community cannot
 afford  a loan for at least 15 percent of
 a project's CW SRF-eligible cost, the
 State may elect to provide less than a 15
 percent CW SRF loan or hardship
 assistance alone. In these cases,
 provisions in the general grant
 regulations at 40 CFR part 31 and other
 rules that apply to subrecipients of
 grants, but not to SRF loan recipients
 (e.g., 40 CFR part 32; debarment,
 suspension, and drug-free workplace
 requirements), will apply to the
 recipient of the hardship assistance. In
 addition to the general grant regulations,
 which prescribe rules on financial
 management, procurement and record
 keeping practices of subgrantees,
 projects receiving hardship assistance
 alone or less than 15 percent SRF
 funding must comply with Federal
 cross-cutting authorities and with
 Agency regulations implementing the
 National Environmental Policy Act at 40
 CFR part 6. The State will be
 responsible for ensuring that
 communities receiving  hardship
 assistance alone or less than 15 percent
 SRF funding are aware of requirements
 imposed upon them by Federal statute
 and regulation. As part  of the Hardship
Grant-agreement, the State and EPA will
negotiate their respective roles for
ensuring that these projects comply
with 40 GFR part 31 and Federal cross-
cutting authorities.

Grants to States
  The Agency will make hardship rural
community program grants to the States
separately from CW SRF capitalization
grants. Before receiving a grant and no
later than one year from the date of
publication of funding allotment in the
Federal 'Register, the Governor of the
State must submit a Notice of Intent to
use the grant for the purposes of the
program. If the Governor elects not to
submit a Notice, grant funds available to
that State will then be allocated among
those States that have furnished a
Notice. Grant funds will be available for
obligation to the State for two years
from the date of publication of funding
allotment in the Federal Register. Funds
not obligated during that period will be  •
reallotted and awarded to States that
have received an obligation of all such
funds during that period. All reallotted
funds will be available for obligation
within two years of the date of
reallotment.
  The State must specify which
department of government will receive
and administer the grant funds. The
department or agency that receives the
hardship assistance grant does not need
to be the same department that
administers the State Revolving Fund.
However, close coordination between
these programs is necessary to meet the
requirements of these guidelines. If an
agency other than that which
administers the State Revolving Fund
will administer the Hardship Grant
program, a memorandum of
understanding (MOU) or similar
agreements between the agencies will be
required in the Hardship Grant
application to EPA. MOUs should
clearly delineate the division of
management responsibilities among
agencies.                            '
  The Hardship Grants Program for
Rural Communities may be subject to
your State's intergovernmental review
process under Executive Order 12372,
and/,or the consultation requirements of
Section 204, Demonstration Cities and
Metropolitan Development Act of 1966,
42 U.S.C. 3334 (the Act). Applicants
must contact their State's Single Point of
Contact (SPOC) for intergovernmental
review as early as possible to find out
whether Hardship grant applications
(CFDA #66.470) are subject to the State's
Executive Order 12372 review process
and, if so, what material must be
submitted to the SPOC for review. If the
application is for a community within a

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Federal Register  / Vol.  62.  No. 54 7 Thursday. March  20,  1997 / Notices
"metropolitan area" as that term is
denned at 42 U.S.C. 3338(4), then the
requirements of the Act are applicable.
You must notify area-wide metropolitan
or regional planning agencies and/or
general government units authorized to
govern planning for the locale of your
project of your intended application.
SPOCs and other reviewers should send
their comments concerning Hardship
Grant applications to the appropriate
Regional State Revolving Fund
Coordinator no later than 60 days after
receipt of an application and other *
required material for review. In
accordance with 40 CFR 29.8(c) a 60 day
review is mandatory for projects subject
to the Act.
  The costs of administering the
program shall not be deducted from the
hardship assistance grant
Administration funds must not be from
any fees or other charges imposed on
the communities likely to be served by
the grant Administering the program,.
does not include the costs of providing
technical assistance to benefit qualifying
communities.
Allocation of Grant Funds
  The $50 million dollars appropriated
by the Consolidated Omnibus
Appropriations and Rescissions Act of
Fiscal Year 1996 (P.L. 104-134) for
hardship grants are allotted among the
50 States, Puerto Rico, and the
territories as of the date of this Federal
Register notice. Attachment D provides
the funding allotment The District of
Columbia and the former trust territory
of Palau will not receive hardship grant
funds. The District of Columbia has no
qualifying communities. Palau no longer
receives new Federal assistance for
 infrastructure needs (Pub. L. 99-239;
 Compact of Free Association Act).
   Comments from both Congress and
 States indicate that the CW SRF formula
would not sufficiently target the
 hardship funds to areas of the country
 with the most potential need. Two
 program requirements are included in
 the formula for allocation. Lack of
 access to centralized wastewater
 collection and treatment systems and
 per capita income are the indicators of
 hardship need that will help target the
 funds to areas of the country with the
 greatest need. The first of these factors
 is weighted 75 percent and the second
 25 percent. More weight is given to
 households without access to
 wastewater treatment systems because it
 represents a stronger indicator of
 environmental problems.
    National data regarding these
 indicators was obtained from the 1990
 Census of Housing and the 1990 Census
 of Population published by the U.S.
                    Bureau of the Census. The 1990 Census ,
                    provides the most up-to-date data for
                    rural areas na tionwide. The Bureau of
                    the Census provides a data threshold for .
                    rural populations of 2,500 or fewer. This
                    population threshold is the closest
                    available from the Bureau of the Census
                    to the 3,000 person population limit of
                    the hardship grants program. Because
                    communities must be rural, both
                    indicators of need used in the allotment
                    formula are narrowed to rural .
                    populations within States. For instance,
                    data for households without access to
                    centralized wastewater treatment in
                    each State relates only to households in
                    rural areas of 2,500 or fewer people that
                    do not have access to-centralized
                    treatment. Per capita income data in
                    each State is related to rural areas of
                    2,500 or fewer people where the per
                    capita income is not greater than 80%
                    of national per capita income. Due to
                    lack of consistent household and
                    income data for the Territories, the
                    Territories are allotted funds based on
                    their CW SRF allotment formula. More
                    details on the allotment methodology
                    are available in Attachment E.
                      The Territory of Guam, Territory of
                    American Samoa, the Commonwealth of
                    the Northern Mariana Islands, and the
                    Virgin Islands do not operate CW SRF
                    programs and instead receive their SRF
                    allotments for use as construction grants
                    under title II of the Clean Water Act
                     (Pub. L. 101-144, as amended by Pub.
                    L. 101-302). These jurisdictions may
                    receive hardship assistance for the
                    entire cost of a project benefiting a
                    qualifying community or to supplement
                     a construction grant that is made for a
                     project benefiting a qualifying
                     community.         '
                       Indian Tribes are not treated as States
                     under the hardship grant program.
                     Instead, Tribes receive one-half of one
                     percent of the CW SRF appropriation for
                     use as construction grants (Clean Water
                     Act section 518(c), 33 U.S.C. 1377(c)).
                     Nonetheless;, data for Indian Tribe
                     communities that qualify under the
                     criteria described in these guidelines are
                     included in the Census data used to
                     develop the State allocation formula.
                     Indian Tribes may receive hardship
                     assistance from the State, either for the
                     entire cost of a project, to supplement a
                     construction grant, or to supplement a
                     CW SRF loan. States are encouraged to
                     provide due consideration to all
                     qualified applicants, including Indian
                     Tribes, when developing their ILIPs and
                     apportioning hardship assistance among
                     qualifying communities.
                       When the grant is awarded to the
                     State, the Agency will make funds
                     available for cash draws through the
                     Automated Clearinghouse (ACH)
process established in each State for
EPA grants. The State may then draw
cash through the ACH for the expenses
involved in providing technical
assistance and to reimburse
communities as construction proceeds.
  Within one year of the end of the
period of availability, the State must
enter into commitments to provide
hardship assistance to benefit qualifying
communities in an amount equaling 105
percent of the amount of the grant.

State Match
  In order to increase the amount of
funds available for the purpose of this
program, each State will provide a 5
percent match for.lhe grant The source ..-
of the match must be identified on or
before the date the Federal award of the
grant is made, with actual cash being
required at the time of cash draw from
the ACH. Matching funds must not be
from any fees or other charges imposed
on the communities likely to be served
by the grant. The State cannot use SRF
assets to acquire the match.
   Funding from other Federal assistance
programs may be used for matching
funds if specifically allowed by the laws
and procedures of those programs.
Funding from the Environmental
Protection Agency may not be used as
match for this program.
Obligations of the States as a Grantee
   The State must comply with the
Agency's general grant regulations at 40
CFR part 31 to the extent that they
 involve matters that are not addressed
by these guidelines for administering
 the particular requirements of section
 102(d) of H.R. 961 and the Omnibus
 Appropriations Act. The part 31
 regulations contain requirements on
 applying for the grants, maintaining
 finances in accordance with State rules,
 and auditing the grants.
   Other matters related to the State s
 operation of the program should be
 negotiated between the State and the
 Regional office, and should be specified
 in the State's CW SRF Operating •
 Agreement (OA) or in the hardship grant
 agreement itself. The State must also
 furnish a statement signed by the State's
 Attorney General certifying that the
 State has the legal authority to receive
 and administer the grant in accordance
 with these guidelines and that the State
 can legally bind itself to the terms of the
 grant agreement. This Attorney
 General's certification can be done in
 conjunction with the Attorney General's (
 certification required for CW SRF
 capitalization grants under 40 CFR
 35.3110(d)(2).
    All projects that the State intends to
 provide hardship assistance must

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                  Federal Register /  Vol. 62.  No. 54 / Thursday. March 20.  1997 / Notices
                                                                                                         13525
appear in the CW SRFIUP, including
individual projects and the provision of
technical assistance. The State agency
that is receiving the grant should
consult State community development
or rural assistance departments for
assistance in identifying qualifying
communities. Progress on hardship
assistance projects must be described in
the State's CW SRF Annual Report. A
database being developed for the
hardship grants program in conjunction
with the SRF Information Management
System States are required to provide
delta to EPA Regional offices for
inclusion in the information system.
Qualifying Communities
  In consultation with the Regional
office, the State may provide hardship
assistance, including technical
assistance, to benefit any community of
more than a single household but no
more than 3,000 inhabitants that is
identified by the State as a rural
community, is not a remote area within
the corporate boundaries of a larger city,
and satisfies the criteria described
below. In cases where the entire State is
divided into incorporated areas, the
State should propose, as part of its
application for Regional approval, a
method for delineating rural
communities.
  In the legislative history to the Clean
Water Amendments of 1995, national
per capita income and unemployment
rates are the criteria recommended by
the sponsors of section 102(d) for
determining whether a community is
"severely economically disadvantaged"
(House debate, remarks of Mr. Shuster,
Cong. Rec. H5008, May 16,1995).
Consequently, a community may qualify
for hardship assistance if, on the date
the community applies for assistance:
   • The community lacks centralized
wastewater treatment or collection '
systems or needs improvements to
onsite wastewater treatment systems
and the State determines that assistance
will improve public health or reduce an
environmental risk; and
   • Per capita annual income of
residents served by the project does not
exceed 80 percent of national, per capita
income, based on data available as
indicated in the following paragraphs;
and
   • On the date the community applies
for assistance, the local unemployment
rate exceeds by one percentage point or
more the most recently reported,
average yearly national unemployment
rate.
   Due to the shortage of up-to-date
income and unemployment information
for hardship communities, States will
have the flexibility to determine the
source of the data and the methodology
used to compare communities to these
standards. This information should be
included in the State's hardship grant
application and is subject to Regional
approval.
Per Capita Income Data
  There are two sources of national per
capita income data—the Bureau of the
Census and the Bureau of Economic
Analysis (BEA). The most recent,
comprehensive nationwide survey of
per-capita income was provided by the
Bureau of the Census in 1990. This
income data is periodically updated.
The Bureau of the Census measures per
capita income by cash equivalents. In
1994, the updated national per capita
income reported  by the Bureau of the
Census was $16,555,80 percent of
which is $13,244.
  The Bureau of  Economic Analysis
also measures per capita income.
However,  their measure includes cash
income as well as other income, such as
benefits, food stamps, etc. BEA's 1994
national per capita income was
$21,696,80 percent of which is $17,357.
  Local level data is also available to
varying degrees from the Bureau of the
Census and the Bureau of Economic
Analysis.  The 1990 Census Has the most
recent comprehensive local level data
available. In 1994 the Bureau of the
Census updated per capita income data
for the nation, States, and metropolitan
.statistical areas. BEA updates their per
capita income yearly to the county level.
The latest county level BEA data is for
1994. States and communities may also
choose to generate local level data by
performing a survey of the community.
Income survey tools are  used for the
U.S. Department of Housing and Urban
Development's Community
Development Block Grant program that
can be modified  for use in this program.
  Options for comparing local data to
national data include, but are not
limited to:
  • .Comparing a community's 1990
. Census data to national data from the
 1990 Census;
  • Adjusting 1990 Census data for a
community to a  more recent year, using
State multipliers, so that it is
comparable to the latest national  Census
data;
   • Surveying a community to gather
up-to-date local  data for comparison to
either Census or BEA data as
appropriate;  or
   • Using county BEA data to qualify
 the county as a whole for the income
 requirement. Small communities within
 that county that meet the other criteria
 of size, rural, lack of access to
wastewater systems, and unemployment
would the'n qualify for funding.

Unemployment Data

  Unemployment data is available from
the Bureau of Labor Statistics (BLS). The'
unemployment rates are updated  '
monthly for the national, State, and
county level. Average yearly
unemployment is computed by adding
the last 12 monthly unemployment rates
and dividing by 12 for both the national
and county level. States are free to use
county BLS data to qualify the county
as a whole for the unemployment
requirement. Small communities within
that countyjhat meet the. other criteria
of size, rural, lack of access to
wastewater systems, and per capita
income would then qualify for funding.
States and communities may also
.choose to generate community level
unemployment data by performing a
survey of the community.

Eligible Projects ,

   A State can provide assistance from
the grant for the planning, design and
construction of publicly owned
treatment works and alternative
wastewater systems. Publicly owned
treatment works and alternative
treatment systems include those defined
in section 212 of the Clean Water Act
which are commonly funded under the
CW SRF program and with construction
grants under Title II of the Act. States
should consider how projects receiving
hardship assistance will best meet the
objectives of their watershed plans or
the Intended Use Plan, where watershed
plans are not available, when selecting
projects for funding. Recipients of
hardship assistance should consider the
cost-effectiveness of alternative means
for addressing its wastewater treatment
needs.
   The sponsors of H.R. 961 viewed the
assistance options under section 102(d)
broadly, stating in the Committee Report
that they include "training, technical
assistance and educational programs
 relating to the operation and
 maintenance of such sanitation'
 services." (H. Rept. 104-112, p. 101).
The decision on the level of funding to
 provide for planning, design and
 construction versus training, technical
 assistance and education programs is at
 the State's discretion. However, onsite
 technical assistance may only be
 provided to qualified communities and
 the primary purpose of technical
 seminars and other training must be to
 train qualified communities.

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Federal Register / Vol.  62. No.  54 /Thursday. March 20. 1997 / Notices
 Obtaining Hardship Rural Community
 Assistance
   Before the State may offer hardship
 assistance, it must ensure that projects
 in qualifying communities appear in the
 CW SRF Intended Use Plan (TUP)- The
 State should explain in its IUP the level
 of SRF loan and hardship grant
 assistance that may be available for
 these communities. Hardship grants
 should be available only to the extent
 that an SRF loan is not affordable. In the
 State's CW SRF Annual Report (section
 606(d) of the Clean Water Act), which
 contains information relating to the
 goals, objectives, and accomplishments
 set out in its IUP, the State must also
 report on the progress of its hardship
 grant assistance efforts.
   Qualifying communities should apply
 for hardship assistance when applying
 for CW SRF loans under procedures
 established for the State's CW SRF
 program. The State and the community
 can then decide on the appropriate mix
 of SRF loan funds and hardship
 assistance. If a community cannot afford
 a 15% SRF loan, it may receive more
. than an 85% grant or hardship
 assistance only and proceed under the
 general  grant regulations at 40 CFR part
 31, as described previously.
 Attachment A—Hardship Grants for
 Rural Commupities
   From the Omnibus Consolidated
 Rescissions and Appropriations Act of
 1996  (Pub. L. 104-134):
 State and Tribal Assistance Grants
   For environmental programs and
 Infrastructure assistance. . .Provided
 Further, that of the funds made available
 under this heading for capitalization grants to
 State Revolving Funds under title VI of the
 Federal Water Pollution Control Act, as
 amended, $50,000.000 shall be for
 vrastewater treatment In Impoverished
 communities pursuant to section 102(d) of
 H.R. 961 as approved by the United States
 House of Representatives on May 16,
 1995  ...
   From H. Rept. 104-384  (Conference
 Report  to accompany H.R. 3019, which
 would be enacted as the Omnibus
 Consolidated Rescissions and
 Appropriations Act of 1996):
   From  within the amount appropriated for
 •wastewator capitalization grants, $50,000,000
 Is to be made available for wastewater grants
 to Impoverished communities pursuant to
 section  102(d) of H.R. 961 as approved by the
 House of Representatives on May 16,1995.
 The Conferees expect the Agency to closely
 monitor state compliance with this provision
 to assure that funds are obligated
 appropriately and in a timely manner.
 Unused funds allocated for this purpose are
 to be made available for other wastewater
 capitalization grants.
                       From section 102(d) of H.R. 961, the
                     Clean Water Amendments of 1995,
                     adding subsection (5) to section 104(q)
                     of the Federal Water Pollution Control
                     Act:
                       (5) Small Impoverished Communities—
                       (A) Grants.—The Administrator may make
                     grants to States to provide assistance for
                     planning, design, and construction of
                     publicly owned treatment works and
                     alternative wastewater treatment systems to
                     provide wastewater services to rural
                     communities of 3,000 or less that are not
                     currently served by any sewage collection or
                     wastewater treatment system and are severely
                     economically disadvantaged, as determined
                     by the Administrator.
                       (B) Authorization.—There is authorized to
                     be appropriated to cany out this paragraph
                     $50,000,000 per fiscal year for fiscal years
                     1996 through 2000.
                       FromH. Rept. 104-112, to accompany
                     H.R. 961, the Clean Water Amendments
                     of 1995:
                       Wastewater Treatment in Impoverished
                     Communities. Section 102(d) authorizes $50
                     million per year for fiscal years 1996 through
                     2000 for EPA to award grants to States for
                     funding the planning, design and
                     construction of POTWs in small,
                     impoverished communities of 3.000 people
                     or less that lack sewage treatment systems
                     and are severely economically
                     disadvantaged.
                       In communities with these circumstances,
                     the committee believes the award of federal
                     grant monies is justified for the protection of
                     human health and the environment, and as
                     further insurance for the government's
                     investment, grant monies may be used  for
                     training, technical assistance and education
                     programs relating to the operations and
                     maintenance of such sanitation services.
                       Despite enactment of the Federal Water
                     Pollution Control Act of 1972 and the
                     expenditure of billions in federal funds for
                     the construction of POTWs (sic), thousands
                     of small communities still are not served by
                     central wastewater treatment facilities  today.
                     Many small Impoverished communities lack
                     the resources even to repay low or zero-
                     interest loans under the current SRF
                     structure. Without financial assistance,
                     untreated human sewage will continue to
                     flow from pipes and seep from poorly
                     functioning septic systems and privies,
                     posing human health and environmental
                     risks.
                       The Committee anticipates working  closely
                     with the Administrator to develop
                     appropriate criteria regarding "severely
                     economically disadvantaged."
                        From House debate on H.R. 961
                      (Congr. Rec. H5008,104th Congress, 1st
                     session); Remarks of Mr Shuster,
                      Chairman, Transportation and
                      Infrastructure Committee:
                       Administration of the funding provisions
                      need additional clarification. Section 102(d)
                      of H. R. 961 authorizes the Administrator of
                      EPA to make grants to the States for
                      planning, design, and construction of
                      publicly owned treatment works in rural
communities of 3,000 people or less which
are severely economically disadvantaged.
The committee report states the committee's
Intention to work closely with the
Administrator to develop appropriate criteria
regarding severely economically
disadvantaged. I wish to clarify'that the
committee considers eligible communities as
those having a per capita Income of no more
than 80 percent of the national average and
an unemployment rate of 1 percent or more
above the national average.

Attachment B—Memorandum
SUBJECT: Proposed Delegation of
    Authority to Approve Grants and
    Cooperative Agreements for Water
    Infrastructure Projects for Fiscal
...  Year, 1996 and Subsequent Years to
    the State and Tribal Assistance
    Grants Account and any Successor
    Accounts—DECISION
    MEMORANDUM
FROM:
  Robert Thorlakson. Director IsJ
  Office of Water/Office of Research and
    Development Human Resources
    Staff
  David R. Alexander, Director Isl
  Organization and Management
    Consulting Services
TO: The Administrator
THRU: AX
  Issue: The Office of Water (OW)
proposes delegating to Regional
Administrators (RAs) the authority to
approve grants and cooperative
agreements for water infrastructure
projects and grants to States for
providing assistance to "severely
economically disadvantaged rural
communities" from funds appropriated
in Fiscal Year 1996 and subsequent
years to the State and Tribal Assistance
Grants Account and any successor
accounts.

Background
  The Fiscal Year 1995 Appropriations
Act for VA, HUD, and Independent
 Agencies (P.L. 103-327) authorized the
 award of grants for 50 water
 infrastructure projects identified in the
 Conference Report (H.R. Report No.  715,
 103d Congress, 2d Sess. at 39-43
 (1994)). The authority to award these
 grants was delegated to Regional
 Administrators by Delegation No. 1-92,
 1200 TN 373, dated 10/31/94). All funds
 available for the 50 projects under this
 appropriation have been awarded.
   The EPA section of the Omnibus
 Consolidated Rescissions and
 Appropriations Act of 1996 (P.L.  104-
 134) authorizes $306.5 million in grant
 funding for 22 water infrastructure
 projects including some for which funds
 have been provided by P.L. 103-327 and
 for which additional grants have been
 awarded from funds provided by

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                  Federal Register /Vol. 62. No. 54 / Thursday.  March 20. 1997 / Notices
                                                                                                          13527
Continuing Resolutions (CRs) enacted
prior to the enactment of P.L. 103-134.
Close coordination with State and local
agencies requires award and
administration of these grants and
cooperative agreements at the regional
level.
Analysis and Review
  A new delegation is needed to allow
Regional Administrators to award the
remaining funds authorized by P.L.
104-134 for Congressionally-designated
water infrastructure projects and grants
to States for providing assistance to
"severely economically disadvantaged
rural communities" because these grants
will be subject to different terms and
conditions—for example those
concerning local cost-share
arrangements—than those awarded with-
funds provided by P.L.  103-327 and the
FY 1996 CRs. Further, the FY 1996
Appropriations Act (P.L. 104-134) is the
only statutory authority to award grants
to many of the projects, so delegations
already issued for other statutes (such as
the Clean Water Act) are insufficient to
allow Regional Administrators to award
the grants. The new delegation of
authority has been written so it will
cover grants for similar water
infrastructure projects authorized by
future appropriations to the State and
Tribal Assistance Grants Account or
successor accounts.
  The delegation proposal was
distributed under the Directives
Clearance Record review process to 15
offices. Three offices and three regions
submitted comments. The Office of
Grants and Debarment (OGD) and
Region 8 submitted comments relating
to the appropriate level for fedelegation
authority. The OGD also proposed
adding an additional reference and
deleting another reference. The Office of
General Counsel had editorial
comments and reviewed language
changes proposed by other reviewers.
Region 2 comments suggested that this
delegation provide authority to award
grants to States for providing assistance
to "severely economically
disadvantaged rural communities." No
issue resolution was requested by any
office or regions and editorial comments
submitted were .incorporated into the
final delegation.
Recommendation
  This delegation is needed
immediately to respond to the
numerous requests from grantee
agencies who have already developed
applications. We recommend that you
approve the proposed delegation by
'signing below.
  Approved: Carol M. Browner.
  Dated: June 21,1996.
Attachment
Attachment C—Cross-Cutting Federal
Authorities Applicable as of June 1996
  Delegation of Authority—Grants and
Cooperative Agreements for Water
Infrastructure Projects from Funds
Appropriated for FY 1996 and
Subsequent Years to the State and Tribal  Environmental
Assistance Grants Account and Any >
Successor Accounts.     "
  (Note: This list is subject to change. For
further information about the applicability of
specific requirements, please contact the
appropriate Regional Office of EPA;)
Delegations Manual
[1200 TN 425]
June 21.1996.
General, Administrative, and
Miscellaneous
   1-102. Grants and cooperative
agreements for water infrasTructure
projects from funds appropriated for
fiscal year 1996* and subsequent years
to the State and Tribal Assistance Grants
Account and any successor accounts.
   1. Authority: To approve grants and
• cooperative agreements for water
infrastructure projects and grants to
States for providing assistance to
"severely economically disadvantaged
rural communities" from funds
appropriated for Fiscal Year 1996* and
subsequent years to the State and Tribal
Assistance Grants Account and any
successor accounts and to perform other
activities necessary for the effective
administration of those grants and
cooperative agreements.
   2. To Whom Delegated: Regional
Administrators.
   3. Redelegation Authority: This
authority may be redelegated to the
Division Director or equivalent level
and may not be redelegated further.,
   4. Limitations: a. This delegation
applies only to those grants and
cooperative agreements for which there
 is no authority other than the statute
 making appropriations to the State and
Tribal Assistance Grants Account and
any successor accounts in Fiscal Year
 1996* and subsequent years.
   b. Awards are subject to guidance
 issued by Office of Wastewater
 Management and Office of Comptroller.
   5. Additional References: a. Authority
 to execute (sign) these financial
 assistance agreements is delegated to the
 Regional Administrators under
 Delegation 1-14, "Assistance
 Agreements";                       >
   b. 40 CFR Part 31,
   c. 40 CFR Part 40 for Demonstration
 grants,
   d. 40 CFR Part 35,' Subpart K, and
   e. EPA Assistance Administration
 Manual.                 ' ,
   * The Omnibus Consul Idated Rescissions and
 Appropriations Act of 1996 (P.L. 104-134).
Archeological and Historic Preservation
  Act of 1974, PL 93-291
Clean Air Act, 42 USC 7506(c)
Coastal Barrier Resources Act, 16 USC
  3501,etseq;
Coastal Zone Management Act of 1972,
  PL 92-583, as amended
Endangered Species Act, 16 USC 1531,
  et seq.
Executive Order 11593, Protection and
  Enhancement of the Cultural
  Environment
Executive Order 11988, Floodplain
  Management
Executive Order 11990, Protection of
  Wetlands
Farmland Protection Policy Act, 7 USC
  4201,etseq.
Fish and Wildlife Coordination Act, PL
  85-624, as amended
National Historic Preservation Act of
  1966, PL 89-665, as amended
Safe Drinking Water Act, section
  1424(e), PL 920523, as amended
Wild and Scenic Rivers Act, PL 90-542,
  as amended

Economic
Demonstration Cities and Metropolitan
    Development Act of 1966, PL 89-
    754, as amended
Section 306 of the Clean Air Act and
    Section 508 of the Clean Water Act,
    including
  Executive Order 11738,
    Administration of the Clean Air Act
    and the Federal Water Pollution
    Control Act with Respect to Federal
    Contracts, Grants, Or Loans       .  •

Social
Age Discrimination Act, PL 94-135
Civil Rights Act of 1964, PL 88-352
Section 13 of PL 92-500; Prohibition
  against sex discrimination under the,
  Federal Water Pollution Control Act
Executive Order 11246, Equal
  Employment Opportunity
Executive Orders 11625 and 12138,
  Women's and Minority Business
  Enterprise
Rehabilitation Act of 1973, PL 93-112
   (including Executive Orders 11914
  and 11250)            ,

 Miscellaneous
 Uniform Relocation and Real Property
   Acquisition Policies Act of 1970, PL
   91-646
 Executive Order 12549, Debarment and
   Suspension

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                   Federal Register / Vol. 62, No.  54 / Thursday. March 20. 1997
Attachment D—Fiscal Year 1996
Allotment of Hardship Grant
Assistance
                                   State
Households w/
o access allo-
   cation
  @$37.5M
 (75% of $50
     M)
Income based
  allocation
  @$12.5M
 (25% of $50
     M)
                                                                                                        State alloca-
                                                                                                        tion @$50M
                                                                               $1,107,300      $348,500
ALABAMA	-"	        132,500        61,600
ALASKA		-	       316,200        128,300
ARIZONA		'	         670,300        362,000
ARKANSAS		.'.	'•	•	'	     1,232,500        194,700
CALIFORNIA		'	        310,000        168,400
COLORADO	       443 400          4,200
CONNECTICUT 	•	       ! 33 20Q        22,700
DELAWARE 	:	          '  0             0
DIST. OF COLUMBIA 	•	••	•	     1,303,300        207,400
FLORIDA		•	'""	     l'514,800        378,300
GEORGIA		•	           57,400        52,000
HAWAII		'	       230,600        138,100
IDAHO 		~	•	:	       784,300        532,900
ILLINOIS		-	     1,052,400        345,700
INDIANA		•	";	"	',	       325,600        511,500
IOWA —	•'	:	'.  '       266,000        385,400
KANSAS		.'.	•	•	"	'	     \ 051 300        313,100
KENTUCKY „	'	-	       770,900        296.900
LOUISIANA _	•	'	       569 800         74,000
MAINE		•••	:	       513,100         44,900
MARYLAND	~	••••	"	"'"".       651600         10,600
MASSACHUSETTS „	'	      1 879 100        401,600
MICHIGAN			       746200        504,900
MINNESOTA	-	:	       758 500        286,500
MISSISSIPPI	'	*	       914400        547,500
MISSOURI  „	•	'	        214 000        127,200
MONTANA	        156,200        316,200
NEBRASKA	""'           67 600         27,100
NEVADA		•	'	v	     '   425,500  .     • 22,800
NEW HAMPSHIRE	   .     3gg 700        ., 9 200
NEW JERSEY	•	"        258'6po       j 31 ;100
 NEW MEXICO  _	"	      1 894 800       257,200
 NEWYORK..		•	«	      2326,300       365,800
 NORTH CAROLINA ....	-	'	        101 800-      182)800
 NORTH DAKOTA		•	•	"	""      1 462'50o       522,900
 OHIO 		•	—"•	'	        568,100       421,500
 OKLAHOMA .—	•	        50g 300       174,500
 OREGON	„..	'	      2166,900       610,900
 PENNSYLVANIA „	:	•	104'200             Q
 RHODE ISLAND		        954000       210,900
 SOUTH CAROLINA 	;	•	"	        111 'sOO       210,800
 SOUTH DAKOTA	:	•	'	       1 246 600       309,400
 TENNESSEE—	:	•	'	       2050,500       892,100
 TEXAS „..,		        104 200       186,500
 UTAH		        290500         42,500
 VERMONT		•	•	'	       1 220 700        155,600
 VIRGINIA	~	:	        774 700        161,800
 WASHINGTON	        657'400       260,200
 WEST VIRGINIA 	'	"	       1 034500        321i3oo
 WISCONSIN		        ' gs^         54,600
 WYOMING		         33 600         11,200
 AMERICA  SAMOA	'	'	     24^300          8,100
 GUAM-	•—	'	""        15600          5,200
 N. MARIANAS 	'	       487300       162,400
 PUERTO RICO	"	:	            0             0
 TT OF PALAU 	.'.-.,	••••••	•	:	••"'"""	'"'   .     19500         6,500
 VIRGIN ISLANDS  ..~	v	"	  	'—	
                                                                                 37,500,000     12,500,000
     TOTAL		-'•	
                              $1,455,800
                                 194,100
                               i  444,500
                               1.032,300
                               1.427,200
                                 478,400
                                 452,600
                                 155,900  .
                                      0
                               1,510,700
                               1,893,100
                                 109,400
                                 368,700
                               1,317,200
                               1.398,100
                                 837,100
                                 651,400
                               1,364,400
                               1,067,800
                                 643,800
                                 558,000
                                 662,200
                               2,280,700
                                1,251,100
                                1,045,000
                                1,461,900
                                 341,200
                                 472,400
                                   94,700
                                 448,300
                                 415,900
                                 389,700
                                2,152.000
                                2,692,100
                                 284,600
                                1,985,400
                                 989,600
                                 681,300
                                2,777,800
                                  104,200
                                 1,164,900
                                  322,300
                                 1,556,000
                                 2,942,600
                                  290,700
                                  333,000
                                 1,376,300
                                  936,500
                                  917,600
                                 1,355,800
                                   140,000
                                   44,800
                                   32,400
                                   20,800
                                   649,700
                                       0
                                   26,000
                                50,000,000

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                  Federal  Register  /  Vol.  62,  No. 54 / Thursday. March  20.  1997 / Notices
                                                                   13529
Attachment E—Allotment Methodology
for the Hardship Grants Program

  The 1990 Census of Housing provides
information on the structural
characteristics of homes, including the
type of sewage disposal. Specifically,
Table 13 of the Census of Housing
provides the number of housing units in
rural areas that are served by public
sewers, septic tanks and cesspools, and
other means. The State allotment for the
households portion of the funding is
computed by taking the total number of
rural households served by septic tanks
and cesspools and other means
(excluding sewered households and
farms) within each State divided by the
national number of rural households
served by septic tanks and cesspools
and other means. This percentage is
multiplied by $37,500^000, which is 75
percent of $50,000,000 appropriated for
the program, to provide the dollar
amount for the households without
access portion of the allotment for each
State. Some administrative adjustments
were then made to the final States"
allocation to accommodate the use of
CW SRF allotment percentages for the
Territories.
  The 1990 Census of Population
provides per capita income (PCI) data. A
computer file was generated by the
Bureau of the Census to provide the
number of communities in each State
that have rural populations of 2,500 or
less and had a per capita income less
than 80 percent of the National per
capita income. The per capita allotment
percentage was computed by dividing
the number of people in each State in
communities less than 2,500 that meet
the 80 percent PCI criteria by the
national population in communities of
less than 2,500 that meet t;he 80 percent
PCI criteria. This percentage is
multiplied by $12,500,000, which is 25
percent of $50,000,000, to provide the
dollar amount for the income portion of
the allotment for each State. As with the
household formula, CW SRF.
percentages were used for the
Territories and administrative
adjustments were made to the final
States" allocation.
  The funding level from both parts of
the formula are added together to
provide the total funding allotment for
each State.
IFR Doc. 97-7070 Filed 3-19-97; 8:45 am]
BILLING CODE 6560-50-P

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