Financing Options for
Nontraditional Eligibilities
in the Clean Water State
Revolving Fund Programs
Clean Water
State Revolving Fund
EPA Publication Number 830B17003
https://www.epa.gov/cwsrf/clean-water-state-revolving-fund-cwsrf-resources
-------
Note to Reader
This paper is a technical document prepared primarily as a reference for the 51 Clean Water
State Revolving Fund (CWSRF) programs and EPA's Regional Offices. The paper focuses on how
varied types of financial assistance available to the CWSRF program can be deployed to fund
eligibilities that do not fall within the mainstream of traditional grey infrastructure. It is
intended to complement the May 2016 "Overview of Clean Water State Revolving Fund
Eligibilities" paper, which includes the expansion of eligibilities in the program stemming from
enactment of the Water Resources Reform and Development Act (WRRDA), particularly in
regard to nontraditional eligibilities. Prominent examples include privately owned green
infrastructure, privately and publicly owned projects for reusing or recycling municipal and
industrial wastewater and stormwater, and a wide range of watershed projects. Eligibilities
and financing options in the program continue to evolve as greater experience is gained with
WRRDA provisions, implementation of the Water Infrastructure Finance and Innovation Act
program, and other developments. As such, both this and the Overview paper should be
viewed as reference works in progress that will be updated periodically. Our sincere
appreciation to all who contributed.
CWSRF Branch
Water Infrastructure Division
Office of Wastewater Management
USEPA
i | P
-------
Table of Contents
Background 1
I. Nontraditional Funding Background and Challenges 1
II. History of Nontraditional Funding 2
CWSRF Types of Assistance and Their Application to Nontraditional Eligibilities 4
I. WRRDA CWSRF Amendments Affecting Eligibilities and Financing 4
II. Types of CWSRF Assistance 7
A. Loans 7
Terms and Conditions 7
Lending Options 8
A.l. Direct Loans 8
A.2. Co-Financing 10
A.3. Partnerships 11
A.4. Conduit / Intermediary Lending 12
A.4.i. Pass Through Lending 12
A.4.ii. Linked Deposit 14
A.4.iii. Sponsorship Lending 16
A.5. Programmatic Financing 17
A.6. Portfolio Lending 19
A.6.i. Capital Improvement Plans 19
A.6.ii. Watershed Management 20
A.7. Intermunicipal Lending 22
A.8. Interstate Lending 22
A.9. Planning and Design Lending 24
B. Purchasing Local Debt Obligations 24
C. Credit Enhancements 25
D. CWSRF Bond Issuance 27
D.l. Traditional Bonds 27
D.2. Green Bonds 27
E. Guarantees Securing Sub State Revolving Fund Lending 28
F. Additional Subsidies 28
III. Sources of Revenue 30
IV. Strategic Planning to Support the Financing of Nontraditional Projects 34
A. Planning 34
B. Marketing and Outreach 37
References 40
ii | P
-------
Figures
Figure 1 - Green Project Reserve 3
Figure 2 - Delaware's Septic Loan Rehabilitation Program 8
Figure 3 - Delaware Private Wastewater System 9
Figure 4 - Washington State Co-financing 10
Figure 5 - Pass-Through Loans 12
Figure 6 - Maine Forestry Direct Link Loan Program 15
Figure 7 - Sponsorship Program 16
Figure 8 - Programmatic Financing 17
Figure 9 - Portfolio Lending - Segmented Cap Example 19
Figure 10 - Watersheds as Water Infrastructure 20
Figure 11 - Watershed Project Participants 21
Figure 12 - Interstate Soil Conservation District 23
Figure 13 - Long Useful Life Examples 25
Figure 14 - NYSERDA Structure 26
Figure 15 - CWSRF Selected Fund Resources FY 2016 - FY 2040 35
Figure 16 - Strategic Program Activities 36
Figure 17 - Marketing Delivery Mechanisms 37
Figure 18 - Audio/Visual Tools for Marketing 39
State Examples
Delaware Decentralized Wastewater Treatment Systems 8
Delaware Privately Owned Wastewater Treatment Systems 9
Maryland and Virginia Farm Credit Banks 11
The Washington Department of Ecology Channels CWSRF Funds through Several
Pass-Through Entities for Agricultural BMP and Septic Repair Projects 13
The Maine CWSRF Provides Linked Deposit Loans for Green Forestry Equipment 14
Ohio Sponsorship Program 16
Programmatic Financing in Hawaii 18
Florida's Segment Cap System Facilitates Multi-Year Portfolio Lending for Very Large Projects 19
Maine Watershed Management 21
The California and Missouri CWSRF Programs Loan to Intermunicipal Agencies
for Wide-Reaching Water Quality Projects 22
PENNVEST Provides Interstate Agency Funding to Support Green Infrastructure Initiatives 23
Washington Interstate Lending 23
Arizona Planning and Design Technical Assistance Grants 24
Pennsylvania's Credit Enhancement Assistance Program 25
The New York CWSRF Guarantees Bonds for Residential Energy Efficiency Improvements 26
Massachusetts Clean Water Trust's State Revolving Fund Green Bonds 27
West Virginia Additional Subsidy 28
Oklahoma -Transforming Benefits Reporting into a Triple Bottom Line Planning and Marketing Tool....38
iii | P
-------
1' ykgroti! i« >
Nontiraditii on a 1 Funding Background and Challenges
The Clean Water State Revolving Fund (CWSRF) (www.epa.gov/cwsrf/) is a significant source of funding
for a wide range of watershed protection and restoration efforts. The program's flexibility and broad
range of funding authorities enable states to target CWSRF funds to their specific water quality
priorities. Despite this flexibility, the majority of CWSRF funding is used for traditional wastewater
infrastructure projects, while funding for nontraditional projects is an area that is still being developed
and explored. Nontraditional projects are those projects that go beyond conventional pipe and plant,
like nonpoint source (NPS) and green infrastructure projects.1 Eligible assistance recipients may include
municipalities, farmers, non-profit organizations, individual home owners, commercial businesses, and
many more. There are also certain types of pipe and plant projects that may be considered
nontraditional since they have not historically received a relatively large amount of CWSRF funding, such
as energy efficiency and water efficiency projects. Nontraditional projects are not meant to take the
place of conventional wastewater treatment projects. Instead, integrating traditional and nontraditional
approaches can provide cost effective solutions to managing wastewater and stormwater needs.
Funding nontraditional projects with the CWSRF can pose several challenges, including:
Many nontraditional projects lack a revenue stream. This makes it difficult to repay a CWSRF loan.
A stream restoration project, for example, does not generate user fees like a wastewater treatment
plant does. Although loans must be secured by a dedicated sources of revenue, it is important to
note that the project itself does not have to serve as the source of repayments.
Administrative challenges for state programs. Nontraditional projects are often smaller in scale
than traditional projects, but require the same, or more, CWSRF staff resources to usher them
through the funding process. The borrowers involved with these types of projects are not always
familiar with the CWSRF program and might require additional assistance. The additional
administrative resources required to get each of these small scale projects funded make it difficult
for CWSRF programs to provide assistance to nontraditional projects. It requires less resources to
fund one large traditional project than several small nontraditional projects.
Barriers to scaling. Nontraditional projects usually do not scale in terms of size and revenue
generation potential. There may be efficiencies gained with consolidating nontraditional projects
with revenue generating projects that are better able to scale.
State restrictions. Some nontraditional eligibilities may face state statutory or policy restrictions to
their funding by the CWSRF. For example, one state until recently prohibited the financing of
stormwater projects. Also, nontraditional eligibilities might have difficulty in getting ranked high
enough on a state's priority list for funding. Whether it is by law, policy, rating criteria, or simply lack
of demand, no state has taken full advantage of the eligibilities available to it under Title VI of the
Clean Water Act. Most states, however, do fund a variety of nonpoint source projects.
1 Nonpoint source (NPS) projects have been funded for some time in the program by most states. However, half of
the state programs (25) have provided less than 2% of their cumulative financial assistance to NPS projects, while
19 states have provided less than 1%. There is room to grow particularly where NPS pollution is causing major
water quality problems.
1 | P
-------
The CWSRF program has an extensive record of using its statutorily described financial mechanisms to
fund high priority projects. Within each of type of assistance there is a wide array of options for states to
consider for their program, and Title VI of the Clean Water Act is designed to encourage states to be
innovative in designing financial programs and assistance delivery mechanisms within the assistance
options. Such efforts on the part of the states have resulted in numerous options for funding
nontraditional projects, many of which can be found in this paper.
Hi: ^traditional Funding
Nontraditional projects have been a part of the CWSRF since 1990, as seen in the following history.
HISTORY OF NONTRADITIONAL CWSRF PROJl I. FUNDING,/III' ! ! \ GUIDANCE
iThe first nonpoint source projects are funded by the Maryland and Washington CWSRF programs.
Maryland's $152,300 loan funds a nonpoint source project in the "urban" category, and Washington's
$169,200 loan funds decentralized sewage treatment projects.
The Ohio CWSRF develops a linked-deposit loan program. The linked-deposit structure is subsequently used
by many states to reach individual borrowers for small-scale water quality projects such as septic
replacement and agricultural best management practices. More information can be found on page 14.
The CWSRF funds over 100 nonpoint source projects in one year (129 projects totaling $160.6 million).
The Washington CWSRF begins providing loans to the Spokane Conservation District for a direct seed
revolving fund that serves counties in Washington and Idaho, the first known example of the CWSRF lending
across state lines via an interstate agency. More information can be found on page 23.
EPA publishes The Clean Water State Revolving Fund Funding Framework (Funding Framework), which
established guidance for identifying and prioritizing nontraditional projects in an effort to move toward a
watershed approach.
More than 500 nonpoint source projects receive CWSRF loans in a single year (529 projects for $143.2
million).
The Arizona CWSRF provides the first loan guarantee, in the amount of $5.5 million.
The Ohio CWSRF develops the first nonpoint source sponsorship program, which allows borrowers to pay for
a nonpoint source project along with a traditional treatment works project in exchange for an interest rate
discount. The model is subsequently adopted by several other states, including Indiana and Iowa.
More than 1,000 nonpoint source projects are funded by CWSRF programs in a single year (1,183 projects
for $370.3 million).
The Maine CWSRF initiates a linked-deposit program with the Maine Forest Service and commercial banks to
provide subsidized loans as incentive financing to "Green" trained loggers for the purchase of "Green"
timber harvesting equipment and other best management practices to reduce the risk of non-point source
pollution from silviculture activities.
EPA issues "The Clean Water State Revolving Fund Program: Tapping its Untapped Potential," a paper
outlining CWSRF-eligible projects that are supported by statute but not historically funded by states.
The Pennsylvania Infrastructure Investment Authority (PENNVEST), the lead state agency for the
Pennsylvania CWSRF, establishes the first clearinghouse for nutrient credit trading. For all credit-generating
projects funded by the CWSRF or commonwealth funds, PENNVEST owns credits up to the value of the loan
subsidy.
1990
1994
1995
1995
1996
1999
2000
2000
2006
2007
October
2007
2008
2 | Page
-------
The American Recovery and Reinvestment Act (ARRA) creates the Green Project Reserve (GPR), increasing
the focus on green infrastructure, water and energy efficiency, and environmentally innovative projects.
EPA issues a "Sustainability Policy for Clean Water and Drinking Water Infrastructure," encouraging CWSRF
investment in green infrastructure by highlighting "natural or green systems" as a key project alternative to
consider in planning sustainable water infrastructure.
The CWSRF is amended by the Water Resources Reform and Development Act (WRRDA) of 2014, which
further expands the program's eligibilities from three project categories to eleven.
The New York CWSRF provides a first of its kind guarantee for loans offered by the New York State Energy
Research and Development Authority (NYSERDA) under the Green Jobs-Green New York program, which
supports energy efficiency improvements. More information is available on page 26.
The largest GPR assistance agreement to date is signed between the Wisconsin CWSRF and the Green Bay
Metropolitan Sewerage District. $98 million in GPR funding (out of a $138 million loan agreement) will be
used for Phase 2 of Resource Recovery Electrical Energy Project.
EPA issues a national Green Infrastructure Policy for the Clean Water State Revolving Fund program,
encouraging states to adopt priority setting systems and financial incentives to promote green infrastructure
projects.
EPA issues the "Overview of Clean Water State Revolving Fund Eligibilities," a paper clarifying the expanded
eligibilities afforded by WRRDA and providing practical project examples.
The establishment of the Green Project Reserve (GPR) in 2009 encouraged investment in additional
nontraditional projects. From 2009-2016, $4.4 billion of assistance provided went towards GPR projects,
which include green infrastructure, energy efficiency, water efficiency, and environmentally innovative
projects. The graph below shows annual spending for each GPR category.
Total Annual GPR 2009 - 2016
Si,200
$1,000
$800
c $600
.2
I
$400
$200
$0
2009 2010 2011 2012 2013 2014 2015 2016
¦ Green Infrastructure ¦ Energy Efficiency ¦ Water Conservation ¦ Innovation
Figure 1 - Green Project Reserve
3 | P a g e
February
2009
2010
2014
2014
October
2015
January
2016
May
2016
-------
CWSRF Type »( -i ¦< ho h : II,' ir Application to Nontraditioh I
Eligibilities
The state CWSRF programs can finance a variety of projects through a multitude of funding mechanisms.
Some of those financing mechanisms are better suited to specific projects and will depend on decisions
made by the state programs.
WRRDA CWSRF Amendments Affecting Eligibilities and Financing
The 2014 WRRDA amendments greatly expanded the array of eligibilities in the CWSRF program. Taken
from the WRRDA Guidance of September 14, 2014, summarized briefly below are the main provisions of
interest. In general, these provisions, in addition to expanding the universe of CWSRF eligible projects,
introduce a sharper focus, allow greater flexibility and provide more resources to the challenge of
paying for nontraditional eligibilities. The bolded text indicates a provision's relevant application.
The statute requires that any municipal, intermunicipal, interstate, or state agency that is a recipient
of CWSRF assistance conduct a cost and effectiveness analysis of the processes, materials,
techniques, and technologies for carrying out the proposed project or activity and selects, to the
maximum extent practicable, a project or activity that maximizes the potential for efficient water
use, reuse, recapture, and conservation, and energy conservation, taking into account the cost of
constructing the project or activity; the cost of operating and maintaining the project or activity over
the life of the project or activity; and the cost of replacing the project or activity (section 602(b)(13)).
CWSRF programs may now provide financial assistance for the construction, repair, or replacement
of decentralized wastewater treatment systems that treat municipal wastewater or domestic
sewage. Publicly and privately owned decentralized wastewater treatment projects are eligible.
Eligible projects include, but are not limited to, the construction of new decentralized systems
(e.g., individual onsite systems and cluster systems), as well as the upgrade, repair, or replacement
of existing systems (section 603(c)(4)).
CWSRF programs may now provide financial assistance for measures to manage, reduce, treat, or
recapture stormwater or subsurface drainage water. Publicly and privately owned, permitted and
unpermitted projects that manage, reduce, treat, or recapture stormwater or subsurface drainage
water are eligible. This language eliminates ownership constraints on regulated stormwater
projects. For example, projects that are specifically required by a Municipal Separate Storm Sewer
System (MS4) permit are now eligible, regardless of ownership. Projects may include, but are not
limited to green roofs, rain gardens, roadside plantings, porous pavement, and rainwater harvesting
(section 603(c)(5)).
CWSRF programs may now provide financial assistance to any municipality or intermunicipal,
interstate, or state agency for measures to reduce the demand for publicly owned treatment
works capacity through water conservation, efficiency, or reuse. Assistance for water conservation,
efficiency, or reuse may be provided to municipalities, intermunicipal, or state agencies. Only the
specified public entities are eligible for assistance; however, project activities may take place at
publicly or privately owned properties, provided the project reduces demand for publicly owned
treatment works (POTW) capacity. Other eligible projects include, but are not limited to, the
installation, replacement, or upgrade of water meters; plumbing fixture retrofits or replacement;
4 | Page
-------
and gray water recycling. Water audits and water conservation plans are also eligible. Equipment to
reuse effluent (e.g., gray water, condensate, and wastewater effluent reuse systems) is eligible
(section 603(c)(6)).
CWSRF programs may now provide financial assistance for the development and implementation
of watershed projects in one of the six areas: watershed management of wet weather discharges,
stormwater best management practices, watershed partnerships, integrated water resource
planning, municipality-wide stormwater management planning, or increased resilience of
treatment works. Assistance recipients may be public or private entities (section 603(c)(7)).
CWSRF programs may provide financial assistance to any municipality or intermunicipal, interstate,
or state agency for measures to reduce the energy consumption needs for publicly owned
treatment works. Projects to reduce the energy consumption needs for POTWs are eligible. Only
the specified public entities are eligible for assistance; however, project activities may take place at
public or private properties, provided the project reduces the energy consumption needs for a
POTW. Projects may include, but are not limited to, the installation of energy efficient lighting,
Combined Heat and Power (CHP), HVAC, process equipment, and electronic equipment and systems
at POTWs. Planning activities, such as energy audits and optimization studies are also eligible
(section 603(c)(8)).
CWSRF programs may now provide financial assistance to both public or private entities for reusing
or recycling wastewater, stormwater, or subsurface drainage water. Projects involving the reuse
or recycling of wastewater, stormwater, or subsurface drainage water are eligible. This includes, as
part of a reuse project, the purchase and installation of treatment equipment sufficient to meet
reuse standards. Other eligible projects include, but are not limited to, distribution systems to
support effluent reuse, including piping the effluent on the property of a private consumer, recharge
transmission lines, injection wells, and equipment to reuse effluent (e.g., gray water, condensate,
and wastewater effluent reuse systems) (section 603(c)(9)).
CWSRF programs may now provide financial assistance to any qualified nonprofit entity, as
determined by the Administrator, to provide assistance to owners and operators of small and
medium publicly owned treatment works (A) to plan, develop, and obtain financing for eligible
projects, including planning, design, and associated preconstruction activities; and (B) to assist such
treatment works in achieving compliance with this Act. Projects to provide assistance to small and
medium POTWs are eligible. The definition of small and medium POTWs shall be determined by the
state. Assistance recipients must be a nonprofit entity. A nonprofit entity is one which has Federal
tax-exempt status. The CWSRF cannot fund ongoing O&M activities; however, planning, design and
construction costs for capital projects, as well as broader water quality planning projects, are
eligible. The development and initial implementation of training activities are also eligible (section
603(c)(ll)).
CWSRF loan terms may extend up to 30 years, but must not exceed the useful life of the project.
Existing CWSRF loans may be restructured to reflect the change to loan terms. For example, an
existing 20-year loan with 10 years left to maturity could be restructured to add another 10 years to
the maturity date provided the useful life of the project is 30 years or more. For a CWSRF project
that has multiple components each with a different useful life, the state may use a weighted
average of the components in determining the useful life of the project (section 603(d)(1)),
-------
CWSRF loan recipients must implement a fiscal sustainability plan that includes an inventory of
critical assets that are part of the treatment works; an evaluation of the condition and
performance of inventoried assets or asset groupings; a certification that the assistance recipient
has evaluated and will be implementing water and energy conservation efforts as part of the plan;
and a plan for maintaining, repairing, and, as necessary, replacing the treatment works and a plan
for funding such activities (section 603(d)(1)(e)).
CWSRF programs may increase funding of their administrative costs and other eligible activities.
The maximum annual amount of CWSRF money (not including any fees collected that are placed in
the fund) that may be used to cover reasonable costs is the greatest of the following: an amount
equal to 4 percent of all grant awards received by a state CWSRF less any amounts that have been
used in previous years to cover administrative expenses; $400,000 or .2 percent of the current
valuation of the fund (section 603(d)(7)).
CWSRF programs may provide additional subsidization to a municipality or intermunicipal,
interstate, or state agency. Eligible recipients of a principal forgiveness or negative interest loan may
use a "pass through" loan structure to pass the subsidy along to any eligible recipient of CWSRF
assistance, including non-profits and other private entities. Additional subsidization may only be
provided to eligible recipients for the following: to benefit a municipality that meets the state's
affordability criteria as established under the FWPCA section 603(i)(2); to benefit a municipality that
does not meet the state's affordability criteria but seeks additional subsidization to benefit
individual ratepayers in the residential user rate class; or to implement a process, material,
technique, or technology that addresses water or energy efficiency goals; mitigates stormwater
runoff; or encourages sustainable project planning, design, and construction (section 603(i)).2
2 Restrictions for additional subsidies were modified with the passage of the "Water Infrastructure Improvements
for the Nation Act" (WIIN) in December 2016. Recipients are now eligible for additional subsidy if they implement a
process, material, technique or technology to address water-efficiency goals, to address energy-efficiency goals, to
mitigate stormwater runoff, or to encourage sustainable project planning, design, and construction.
6 | P
-------
IIIITypes of CWS R F Assista n ce
A. Loans
Terms and Conditions
A perceived factor in the limited loan assistance that has been made available to nontraditional
eligibilities in the CWSRF program has been that loans were not affordable or were impractical - that
only grant funding would work economically. If grant funding is available, it makes sense to use that
funding. However, federal sources of grant money are on the decline. On the other hand, the CWSRF
programs have considerable flexibility in setting the conditions for loan assistance, an authority that can
be exceptionally helpful in financing nontraditional eligibilities. Maturities can range up to 30 years or
useful life of the project, and repayment schedules can be structured to suit the needs of the
nontraditional borrowers.
Interest rates can vary from market rates to zero percent, and more attractive rates can be electively
targeted to desired recipients such as disadvantaged communities. Many states currently index their
interest rates to a measurement of financial capability, giving the lowest interest rates to poorer
communities. In addition to targeting low rates to disadvantaged communities, interest rate reductions
can be used to incentivize a variety of goals such as nonpoint source projects, green projects, and the
use of innovative technologies.
Importantly, the project itself does not have to serve as the source of repayments. Any dedicated source
of revenue will do (see Sources of Revenue on page 29). Nonpoint source projects typically do not
charge user fees, but a NPS loan can be repaid from any number of alternative sources. In addition,
embedding a nontraditional project with a loan to a project secured by user fees is another alternative.
Lastly, since the passage of ARRA, CWSRF programs have been able to use a portion of their
capitalization grants to forgive loan principal, award grants, or apply negative interest, all techniques
that in effect reduce the loan balance to be repaid.
7 | Page
-------
Lending Options
A.l. Direct Loans
The CWSRF programs are able to make direct loans to any municipality, intermunicipai, interstate, or
state agency for construction of publicly owned treatment works. These loans are available for the full
range of eligibilities outlined in section 603(c) of WRRDA 2014.
Additionally, CWSRF programs can make direct loans to private borrowers under certain circumstances.
For example, section 603(c)(3) of the Clean Water Act (CWA) allows CWSRF programs to make loans to
private borrowers for the implementation of a Section 320 Comprehensive Conservation and
Management Plan (CCMP), as described in the example below. More information on which eligibilities
allow for assistance to private entities can be found in the "Overview of Clean Water State Revolving
Fund Eligibilities," published May 2016 and available on the CWSRF website.
State Example: Delaware Decentralized Wastewater Treatment Systems
The Delaware CWSRF program has been providing direct loans to privately owned decentralized
wastewater treatment systems successfully for many years under their Septic Loan Rehabilitation
Program (SLRP). The Delaware Department of Natural Resources and Environmental Control (DNREC)
established a partnership with the First State Community Action Agency to assist with much of the
administrative work associated with providing financial assistance directly to individual borrowers to
reduce the burden on CWSRF staff resources, which has been a critical element to the SLRP attaining
their goal of replacing 100 failing septic systems each year.
Delaware's Septic Loan Rehabilitation Program
Financing
Eligibility
Credit Review
Septic Extended
Funding Option
Up to $35,000 for
Applicants currently in
Run credit history
Availableto applicants
individual homeowners
bankruptcy do not
Must have good
denied an SLRP loan
Up to $250,000 for
qualify
standing credit (no
Funding availability
mobile home parks
judgements, collections
same as SLRP
3% or 6% interest,
or serious
0% interest loan
based on income
delinquencies)
No monthly payments
20 year term loan
Debt to income ratio of
Loan secured by Due-
-------
State Example: Delaware Privately Owned Wastewater Treatment Systems
For the first time in its history, the Delaware CWSRF program provided a direct loan to a privately owned
wastewater treatment system. DNREC awarded over $8 million in loan funds to Allen Harim Foods, LLC
for the Harbeson Poultry Processing Plant in southern Delaware. As the 18th largest producer of chicken
products in the world, Allen Harim's operations are sophisticated and complex, generating significant
wastewater flows as well as nutrient loads from nitrogen and phosphorus. The facility currently
discharges into Beaver Dam Creek, which is included in a Section 320 national estuary, thus opening up
eligibility for CWSRF assistance to this private enterprise. Even for an entity with a balance sheet as
robust as Allen Harim's, DNREC performed a thorough credit review that examined:
Comprehensive credit report furnished by Dunn and Bradstreet Credit Reporting Service;
Statement of Cash Flows;
Profit and Loss Statements;
Historical ratio analysis (including cash, profitability, liquidity, and debt service coverage);
Cash Flow Pro Forma Projections.
Delaware's Innovative Loan to a Private Wastewater
System to Achieve Healthy Waters in a National Estuary
Wastewater Expansion and Treatment Upgrade Project
$8.4 Million
Upgrade to a 4-stage Bardenpho BNR process followed by tertiary
filtration to achieve required nutrient removal from effluent
Loan offered at 2% interest for 20 years
Loan secured by a corporate lien and
parent company loan guaranty
Expansion includes a sideline wastewater treatment facility to
treat sanitary wastewater so that it is not combined with process
wastewater. This will help to facilitate plans for future water
reuse at the facility.
DNREC holds first lien position on
improved facilities and real estate
Figure 3 - Delaware Private Wastewater System
9 | P a g e
-------
. COFINANCING
k Washington's State Loan
1 and Grant Programs
A.2. Co-Financing
Aside from the CWSRF, local communities use a variety of state and federal funding sources to help
finance infrastructure improvements. These sources might include the United States Department of
Agriculture, the Department of Housing and Urban Development, and additional state funding
programs. These varied funding sources offer opportunities for the CWSRF to co-fund projects. This can
be especially useful for large projects that cannot be entirely funded by the CWSRF, or if there are
project costs that are not eligible under the CWSRF but are eligible under another funding program.
Another clear advantage of co-funding is that by partially funding projects, states can leverage the
CWSRF funding to assist a greater number of eligible projects. An important note is that all CWSRF
requirements apply to any project that receives any amount of CWSRF funding.
The CWSRF can also partner in a co-
financing arrangement with other state
agencies and programs to reach new
potential borrowers. The advantage of
such partnerships is that many state
agencies already have a close relationship
with potential borrowers for
nontraditional projects. Instead of CWSRF
programs having to build new relationships
with potential borrowers, partnerships
allow them to utilize existing relationships
between communities and state and local
agencies and programs. Several states
have used this approach to reach
borrowers for NPS projects by partnering
with state agricultural offices that already
have an existing relationship with
landowners.
A subset of co-financing is "blended
lending," where at least two parties (the
CWSRF program and another entity) make
a loan, but at different interest rates. The
"blended" rate is the final interest rate,
and could even be a second loan from the
same CWSRF program.
The Washington Department of Ecology
combines funds from four grant and loan
programs to offer affordable project financing
The annual funding cycle combines the lour funding programs into one
process, using one application, one ranking process, ana one priority list
Project Funding
Figure 4 - Washington State Co-financing
10 | Page
-------
A.3. Partnerships
Many types of partnerships are possible in the CWSRF program. As a form of leveraging, partnerships
can extend the reach of the CWSRFs, for example, to fund projects that might otherwise not be in a
position to receive assistance and to access the resources of a partner to help pay the cost of a loan. The
Delaware CWSRF has entered into master lease/purchase agreements with another state agency to fund
necessary infrastructure improvements such as wetland remediation. The arrangement is necessary
because Delaware state agencies are prohibited from issuing debt3, but they are permitted to enter into
leasing arrangements. The CWSRF is the lessor and the state agency is the lessee under a joint
memorandum of understanding. The loan is in the form of a lease paying project costs associated with
the improvements while the loan repayments are in the form of rental payments. Without this
arrangement the Delaware CWSRF would
be unable to assist other state agencies in
constructing worthy environmental
projects.
Another example of a creative partnership
is where a CWSRF program partners with
another department, such as the U.S.
Department of Agriculture, to create
Credit Banks to fund agricultural best
management practices (BMPs). Maryland
and Virginia have both established
agreements with Farm Credit Banks to
help provide loans to farmers to
implement BMPs.
State Example: Maryland and Virginia Farm Credit
Banks
Farm Credit Banks were established to help meet the
specialized needs of farmers. A CWSRF loan can provide
the working capital to finance the entire cost of a
project, usually within three days of submitting an
invoice to the state CWSRF. After the project is built, the
farmer receives the USDA grant reimbursement and
uses it to pay down the loan. Repayment periods for the
remaining loan balance, which represents the farmer's
cost share, may be as long as twenty years but are
typically seven to ten years.
3 Only the Department of Finance can issue general obligation debt on behalf of the Delaware State government.
11 | Page
-------
Pass-Through Loans
CWSRF
o ©
CWSRF receives
loan repayment
A.4. Conduit / Intermediary Lending
A.4.i. Pass Through Lending
The most common structure for intermediary lending in the CWSRF programs is frequently referred to
as "pass-through lending." Pass-through lending channels CWSRF funds through a conduit entity to an
end borrower, as shown in Figure 5. A variety of conduit entities have partnered with CWSRF programs
in pass-through arrangements including state agencies, counties, conservation districts and local
municipalities.
The benefits of pass-through lending include the following:
This structure often takes advantage of existing
relationships between the conduit organization
and the end borrower, attracting borrower
demographics that might not ordinarily use the
CWSRF program.
The conduit entity is frequently able to bundle
several sub-loans and complete the CWSRF
application requirements for all of them,
reducing the administrative burden on
individual end borrowers.
Because the conduit organization is the loan
guarantor, a pass-through arrangement
provides a more secure financial capability
assurance for the CWSRF program as opposed
to making loans directly to the small, untested
end borrowers.
A pass-through structure makes it possible for
CWSRF additional subsidy, such as principal
forgiveness, to reach non-municipal,
nontraditional projects. The WIIN Act allows
any recipient to be eligible for additional
subsidization if they are implementing a
process, material, technique or technology to
address water-efficiency goals, to address energy-efficiency goals, to mitigate stormwater
runoff, or to encourage sustainable project planning, design, and construction. Flowever, a pass
through structure also enables additional subsidy to be provided directly to an eligible public
pass-through partner, who can then channel the savings through to a private or nonprofit end-
user. For more information, see section F on Additional Subsidies.
CWSRF provides
funding to local
or state agency
Government Agency
Low-interest loan
or grant to
borrower
© ©
Borrower
Figure 5 - Pass-Through Loans
Borrower repays
agency for any
loans
12 | Page
-------
State Example: The Washington Department of Ecology Channels CWSRF Funds through Several Pass-
Through Entities for Agricultural BMP and Septic Repair Projects
CWSRF loans are signed with several Washington counties and conservation districts to address nonpoint
water quality problems. The pass-through entities then provide sub-loans to local producers moving from
conventional tillage practices to direct seed systems and to homeowners for repair and replacement of onsite
septic tanks.
Financing Direct Seed Equipment
Direct seed systems use equipment that disturbs only a narrow strip of soil, significantly reducing erosion,
improving soil quality, reducing fuel consumption, and protecting water quality by reducing the sediment and
nutrient load associated with conventional farming techniques.
Since 1995, the Washington CWSRF has provided more than $19.5 million for the direct seed pass-through
program via the Spokane County Conservation District. The Spokane direct seed program benefits farmers in
fourteen counties in Eastern Washington. The program has issued 300 loans, converting 700,000 acres of
farmland to no-till and preventing 1.9 million tons of sediment and the nitrogen, pesticides and other
chemicals from entering Washington waterways. The program is set up as a revolving fund. Direct seed
equipment purchases are repaid to the Conservation District, which uses the landowner repayment to repay
the CWSRF loan. The loans are secured through local tax assessment funds. 5-10-year loan terms are offered.
The Conservation District also receives a grant from the Department of Ecology for the Direct Seed program.
The grant funds are used to offset administration costs, and education, marketing, and outreach efforts.
Pass-Through for Failing Septic Systems
The Washington CWSRF also funds a pass-through program with 15 counties or local health departments in the
Puget Sound and marine counties, as well as the Spokane Conservation District, that provides financing to
individual residents to repair failing onsite sewage systems. The loans may also pay for abandonment of septic
systems and connection to sewer. The county or health department is responsible for local loan servicing,
collecting payments, and payment tracking (but may contract these services to a lending institution). The pass-
through entity also approves or denies loan requests and establishes the terms of the sub-loans to residents.
Quarterly progress reports must be submitted to the CWSRF program providing schedules for project
completion, loan marketing activities, data on loan applications and closures, and a final list of local loans
provided to homeowners and small commercial enterprises. $15 million in CWSRF loans has been provided for
the program since 1990, and over 600 homeowners have participated since 2007.
In 2016, the Washington CWSRF launched a unified program that provides financing to individual residents to
repair or replace failing onsite sewage systems in 11 of the marine counties of Washington State. The State
Department of Ecology has contracted with a financial institution on behalf of those 11 counties, and the
financial institution provides affordable loans (including loan servicing, collecting payments, payment tracking,
approval or denial of loan requests, and establishing the loan terms) to property owners within the 11-county
region. The financial institution repays the CWSRF loan. The financial institution submits quarterly reports, loan
marketing activities, data on loan applications and closures, etc. The participating counties refer homeowners
to the financial institution. CWSRF funds have not yet been disbursed for this program, as of October 2016.
13 | Page
-------
State Example: The Maine CWSRF Provides Linked
Deposit Loans for Green Forestry Equipment
A long-running example of a linked deposit lending
arrangement is provided by the arrangement between
the Maine Bond Bank, the Maine Department of
Environmental Protection, the Maine Forest Service
(MFS), and several local banks to fund the purchase of
"green" forestry equipment. The loans are intended to
increase the use of best management practices and
environmentally-friendly logging equipment in the
Maine logging industry, which will in turn help protect
and restore water quality around logging operations.
Eligible purchases include mulching machines, tractors,
graders, flotation tires, GPS equipment tracking
systems, bridges, and sediment and erosion control
products. An MFS advisory committee reviews purchase
proposals for equipment and structures to ensure that
they are needed to implement environmentally sound
logging operations. Qualified loggers may apply for
loans up to $800,000 to purchase timber harvesting
equipment and implement best management practices
that reduce the risk of nonpoint source pollution from
silviculture activities.
Since the three agencies signed the Memorandum of
Understanding creating the linked deposit arrangement
in 2007, a total of $23.6 million has been committed to
this program. In total, 91 loans have been made
equaling $21.2 million. In 2016, the Maine CWSRF
provided $4.8 million for 19 silviculture loans through
the linked deposit program.
A.4.ii. Linked Deposit
Linked deposit financing takes advantage of the
provision in the CWSRF authorizing statute allowing
CWSRF funds to be used "to earn interest on fund
accounts" (Title 33 Subchapter VI §1383(d)(6)). In a
linked deposit arrangement, a state CWSRF program
purchases a reduced-rate certificate of deposit from a
private financial institution. The financial institution
then loans out the deposited funds (at a slightly lower
interest rate) to individuals for smaller-scale water
quality projects. Many states have used linked deposits
to successfully fund projects such as septic
replacements, agricultural best management practices,
or environmentally-friendly forestry equipment.
Benefits of the linked deposit structure include the
following:
1. Individual end borrowers can work directly
with their own financial institutions instead of
the CWSRF program, bringing familiarity and
comfort to the process.
2. The financial institutions earn a fee that
compensates them for the administrative task
of administering the loans. The linked deposit
arrangement also provides the bank with a
new product to offer their existing customers,
and potentially attract new customers.
3. The financial institution is responsible for
reviewing and approving applications from the
end borrowers (as well as collecting payment),
removing much of the administrative burden
that would otherwise fall to the CWSRF
program. This allows the CWSRF program to
assist many small, individual borrowers.
14 | Page
-------
Linked Deposit
Maine Forestry
Direct Link Loan
Program
Here's how it works:
>
Individual applies for a loan
> Fores
with Maine
(MFS)
'orest Service
Must be a certified logging
professional whose primary
usiness is logging in Maine
£
bi
MPS enters into an agreement
with the applicant prescribing
conditions of the program
MFS provides applicant with a
Certificate of Qualification
identifying the equipment that
is eligible for funding
-------
State Example: Ohio Sponsorship Program
AAifi. Sponsorship Lending
CWSRF lending can combine assistance to both traditional and
nontraditional projects in the same loan agreement. This allows user
fees from the traditional portion of the project to serve as a
repayment stream for the nontraditional project. For example,
combined lending could be used to finance green infrastructure where
an urban wastewater utility wants to reduce the high capital costs of
traditional stormwater infrastructure by installing green infrastructure
projects. A single assistance agreement could cover the cost of both.
Sponsorship lending pairs a traditional POTW project with a
nontraditional one, usually a NPS project. A municipality receives a
loan with a reduced interest rate as compensation for also
undertaking (i.e., sponsoring) a nontraditional project thus allowing
municipalities to address pressing watershed restoration or protection
priorities without placing a repayment responsibility on NPS projects.
This arrangement works best when the cost of the combined project is
equal to or less than the cost of a stand-alone POTW project when
financed at normal CWSRF interest rates. For example, a $1,000,000
loan at 3.8 percent interest would result in a total repayment of
$1,436,707 over a 20-year term. A $1,393,442 loan at 0.3 percent
interest results in the same repayment amount. A municipality could
therefore borrow $1,000,000 for a traditional POTW project plus
$393,442 to implement NPS projects at no additional cost. For added
incentive, a CWSRF could further reduce the interest rate so that the
municipality would save money rather than break even.
CWSRF
Community Sponsor Restoration Project
Implementing Partner
r>
1. Community and implementing partner enter into sponsorship agreement 2 CWSRF provides funding to community
for wastewater treatment and restoration projects. 3 Community provides CWSRF funding for sponsored restoration
project. 4. Community repays CWSRF program.
Figure 7 - Sponsorship Program
The Ohio EPA originated the concept of
sponsorship lending with its Water
Resource Restoration Sponsor Program
(WRRSP). The WRRSP offers communities
very low interest rates on loans for
wastewater treatment plant
improvements if the communities also
sponsor projects that protect or restore
water resources. A community that
participates in the WRRSP does not
typically implement a restoration project
itself. Instead, it enters into a sponsorship
agreement with an implementing
partnersuch as a land trust or a park
districtthat develops and implements
the project, while the sponsoring
community repays the loan. The WRRSP
has supported projects that have acquired
wetlands and riparian lands, acquired
conservation easements, restored habitat,
and modified dams. Ohio's WRRSP
reinforces the idea that wastewater
treatment plant improvements and water
resource restoration projects are
complementary efforts.
16 | Page
-------
A.5. Programmatic Financing
In addition to using the CWSRF, many large wastewater utilities use the bond market to raise the
revenues required to execute the many infrastructure projects identified in their comprehensive Capital
Improvement Plans (CIP). They use general obligation or revenue bonds to fund their project cash
needs, and this is a tried and true approach that has been used successfully for decades. In some cases,
however, a few CWSRF programs have struggled to cultivate strong relationships with the large utilities
as repeat borrowers. However, several states are pursuing an innovative approach to this challenge
using a financing vehicle known as "programmatic financing." Programmatic financing shifts the
traditional project-specific lending strategy to one that is more congruent with using bonds to finance an
annual (or multi-year) cash flow for capital improvement projects. Instead of issuing a binding
commitment for a certain amount of CWSRF dollars to a single project, a programmatic financing loan is
designed to fund the utility's entire CIP (or any portion thereof) so long as the projects are eligible and
prepared in compliance with CWSRF program requirements. This also encompasses nontraditional
projects, and projects eligible under Section 319, that are included as part of the CIP. Often these types
of projects include stormwater, green infrastructure applications, conservation easements, and various
types of restoration projects for wetlands, streambanks, and watersheds. In the event that a project in
the CIP is delayed or falls through for any reason, programmatic financing makes it easy for the
borrower to direct the funding toward any other eligible project activity included in the CIP, thus
ensuring that disbursements continue to flow uninterrupted.
How Does Programmatic Financing Work?
The Basics
Example
CWSRF commits to a level of
funding for repeat borrowers
Borrower prepares CIP projects to meet CWSRF
compliance requirements
Single loan agreement encompasses a "baskef of projects
from the CIP
CWSRF funding may go toward ANY eligible project cost
from the CIP
III
in financing
Any eligible project invoice
that comes in is paid until all
$15M is expended
Figure 8 - Programmatic Financing
17 | Page
-------
State Example: Programmatic Financing in Hawaii
Hawaii's CWSRF program is in the process of
implementing Programmatic Financing, or "ProFi," for
the first time. The development of this process
involved the reinvention of some programmatic
fundamentals, such as the financing application,
priority ranking process, and the loan agreement.
Hawaii dedicated significant time and effort to directly
involve borrowers in the development of this process
and its companion documentation through a number
of face-to-face meetings and outreach efforts. This
resulted in a fully vetted, simple, streamlined format
that is easy and efficient for CWSRF program staff and
borrowers alike.
Planning Framework
Funding encompasses planning, design,
engineering and construction activities for
traditional, stormwater, green infrastructure, and
nonpoint source projects.
Applications are collected on or after CWSRF
meets with the borrower to identify a list of
projects in CIP for current funding cycle.
Binding commitments are made after application
review is complete.
Master Loan Agreements are issued to Borrower
90 days prior to target loan execution date.
Aim for a consistent funding schedule so that
borrowers may reliably plan for each year.
Planning Framework
Checkboxes on the application form allow the
borrower to indicate whether ANY project
included in the ProFi application meets priority
scoring criteria.
Points will be allotted to the entire ProFi loan
application for any project meeting the criteria.
Points in each priority scoring category will only be
awarded once, regardless of how many projects on
the list meet the criteria.
This approach has been used successfully in Minnesota
and Rhode Island for a number of years, and is currently
being implemented in Hawaii. Programmatic financing
provides the programs with a nicely diversified portfolio
of borrowers upon whom they can rely to commit and
expend large sums of CWSRF funds each year, which
helps states to honor their pledge to ensure the timely
and expeditious use of these funds. The programmatic
financing approach includes several significant
advantages over traditional loan funding, such as:
Reduces or eliminates the impact to CWSRF
disbursements caused by slippage in project
schedules;
Accommodates continual disbursements
regardless of project-specific delays;
Easier to stick to an annual milestone planning
schedule;
Reduced burden on state CWSRF staff;
More accurate cash flow management and
projection capabilities;
Can be optimized to reduce or eliminate
unliquidated obligations and more efficiently
spend federal dollars.
The success of this approach in a CWSRF program is best
supported by cash flow management practices that
enable decision-makers to run accurate cash flow
projections in order to commit to a level of funding for
large, repeat borrowers with confidence while
maintaining a healthy working capital balance.
18 | Page
-------
State Example: Florida's Segment Cap System Facilitates Multi-
Year Portfolio Lending for Very Large Projects
In order to provide a fair distribution of funding among small
and large projects, Florida's CWSRF program defines an annual
"segment cap" that indicates that largest funding amount that
any one project may receive in that fiscal year.
For very large projects that exceed the amount of the annual
segment cap, the Florida CWSRF will commit to funding the full
eligible amount of the project, but will only execute a funding
agreement up to the amount of the segment cap for that fiscal
year. However, the funding agreement will include language
acknowledging the full project cost.
Borrowers with a project amount greater than the segment cap
will have the unfunded amounts placed on a Waiting List, a
"holding queue" for partially-funded projects.
If there are sufficient funds available at the end of the fiscal
year priority-setting period, the CWSRF will offer an
amendment to increase funding for Waiting List projects.
Projects on the Waiting List are in the top tier of projects for
subsequent fiscal years, and will receive funding up to the
amount of the segment cap each year until fully funded.
As an example, the CWSRF was able to provide $120 million to
fund high-level disinfection facilities for Miami/Dade over the
course of multiple years. Without using the segment caps,
other projects and borrowers would have been impacted by
such a large commitment to a single project.
A.6. Portfolio Lending
Portfolio Lending differs from Programmatic
Financing primarily in two ways. First, the
focus of Programmatic Financing is on the
schedule and pace of disbursements for a
"basket" of projects on an annual basis
under a single loan agreement. Second, in
contrast, Portfolio Lending is a strategy to
commit funding over time to one or several
projects taken, for example, from a capital
improvement or watershed management
plan. Both options can easily accommodate
nontraditional projects.
A.6.i. Capital Improvement Plans
CIP portfolio lending refers to a CWSRF
program's commitment to fund a certain
portion (or all) of a municipality or utility's
CIP overtime, assuming each project meets
eligibility and priority criteria. This can help
develop long-term borrowing relationships
to ensure stable demand for CWSRF funds,
and contributes to the municipality's long-
term planning efforts. In addition, this
arrangement allows the CWSRF to be
involved in the earliest phases of project
planning, helping ensure that a project
application can be approved quickly.
Portfolio lending requires careful cash-flow
management to ensure that program funds
are not over-extended, but can provide a
valuable level of certainty to a CWSRF
program's project pipeline.
For example, after conducting financial
projections, the SRF may informally commit
$5 million per year for the next five years to
help implement a borrower's capital
improvement plan. This provides budgeting
certainty to both parties, and creates an
expectation of continual partnership in the
future. Although the borrower must still
complete the application process to receive a
loan each year, they have the assurance that
Amount in Loan Agreement
P r o j
iej,
Segment
Cap
Total FY1 CWSRF
¦ i
I Segment ]
i Cap i
Total FY2 CWSRF Funding
Segment Cap
Total FY3
CWSRF Funding
1 1
1 Segment |
| Cap !
Total FY4 CWSRF Funding
Figure 9 - Portfolio Lending - Segmented Cap Example
19 | Page
-------
the SRF will have the financial capacity to fund the project.
If nontraditional projects are included in the CIP projects of traditional eligibilities, they can be financed
at the same time instead of trying to finance as standalone projects. For example, the Rhode Island
CWSRF program frequently makes an annual loan commitment to fund a wide variety of projects from
the Narragansett Bay Commission's CIP. The list of projects authorized to receive CWSRF funding in 2014
included many traditional treatment plant improvement projects, as well as several nontraditional
projects such as a greenhouse gas study, biogas reuse, solar energy, and wind turbines.
A.S.il. Watershed Management
A higher priority on funding projects that address water
quality on a watershed basis is best served by an integrated
planning approach to protection and restoration projects in
an area influencing the water quality of a river or stream.
Examples of such projects include source water protection,
stream stabilization, riparian buffers, green infrastructure,
and wet weather overflows.
The planning and implementation activities associated with
watershed management projects lend themselves well to a
portfolio funding approach that encompasses numerous
projects in various stages through a multi-year lifespan. This
process is very similar to the capital improvement planning
undertaken in a traditional wastewater infrastructure
environment. The bridge between watershed management
projects and a capital improvement planning approach can be
observed in the state of California, which recently signed a
new bill into law that recognizes watersheds as part of their
statewide infrastructure (California Legislature, Bill AB240
signed on September 27, 2016). This provides projects like
stream channel restoration, upland vegetation management,
or forest and wetland conservation with enhanced access to
more conventional funding sources, and makes it easier than
ever for utilities to justify investments in watershed
restoration. The state still needs to raise the appropriate
financing and develop a watershed-investment plan to
guide projects, and the timetable for that investment plan is
forthcoming.
WRRDA specifically includes provisions allowing for the CWSRF to more aggressively pursue projects
that address water quality and resilient infrastructure on a watershed basis through:
Watershed management of wet weather discharges
Stormwater best management practices
Watershed partnerships
Integrated watershed resource planning
atersheds as Water
Infrastructure in CA
^5
On par with pipes and treatment plants
Eligible for same forms of financing as
other wastewater collection and treatment
infrastructure
Infrastructure bonds used for restoration
and protection
Easier for wastewater utilities to justify
investments in watershed restoration
Figure 10 - Watersheds as Water Infrastructure
20 | Page
-------
Municipality-wide stormwater management planning
Expanded eligibilities now also allow for the CWSRF program to finance privately owned stormwater
projects, which also includes reclamation and subsurface drainage water. This offers incentives for
communities within a watershed or sub-watershed area to pursue cross-jurisdictional funding vehicles,
joint powers contractual agreements between a municipality or county with a special district, and
greater intermunicipal cooperation to achieve greater water quality protection. Such benefits also
include increasing the resiliency of treatment works from extreme risk events like flooding and rising sea
levels.
State Example: Maine Watershed Management
A good example of these types of watershed projects working in concert across political jurisdictions
comes from Cumberland County in Maine. The Maine CWSRF program provided $2.1 million in financial
assistance for the Long Creek Restoration Project to reduce stormwater pollutant loads to Casco Bay, an
estuary of national significance as designated by the U.S. EPA. The Cumberland County Soil and Water
Conservation District applied to the CWSRF on behalf of the Long Creek Watershed Management
District. This is a multi-year effort dating back to 2007, with a new suite of stormwater management
projects rolling out each year. The stakeholders involved in this project include:
ecomaine, a
regional waste-
to-energy facility
I
Quasi-Municipal
Entities
Figure 11 - Watershed Project Participants
Under the Long Creek Watershed Management Plan, participating stakeholders may either pay for
individual pollution permits or pay a fee to participate in the proposed Restoration Program. The permit
fees are determined based on the area of impervious cover on the property. This funding mechanism for
the restoration program has proven to be a remarkable success because the cost of participating in the
program is lower than it would be for landowners to purchase individual pollution permits. This
innovative and cooperative funding arrangement enables communities to fund important projects
quickly and provides a valuable model for other rapidly developing urban communities.
83 private
landowners who
own property
with > 1 acre of
impervious cover
Private,
commercial and
retail
Portland. South
Portland.
Scarborough,
Westbrook
Municipalities
Maine Dept of
Transportation
Maine Turnpike
Authority
~
Government
Agencies
21 | Page
-------
State Example: The California and Missouri
CWSRF Programs Loan to Intermunicipal Agencies
for Wide-Reaching Water Quality Projects
The Missouri CWSRF provided a $1.0 million loan
to the Missouri Association Councils of
Government (MACOG) to capitalize the Missouri
On-Site Wastewater Improvement Grant-Loan
program; a pass-through arrangement that
provides financing for homeowners to repair or
replace on-site wastewater treatment systems.
The program provides a 50 percent/50 percent
low-interest loan and grant for low-income
homeowners or a 60 percent/10 percent/30
percent low-interest loan/grant/homeowner
match for non-low-income homeowners. Nineteen
individual regional planning commissions and
councils of government throughout Missouri
administer the financing program for customers
within their jurisdictions, while MACOG
coordinates the entire program and holds the loan
agreement with the CWSRF program.
The California CWSRF has provided four assistance
agreements totaling $3.5 million to the
Association of Bay Area Governments (ABAG), a
regional planning organization formed by a Joint
Powers Authority that coordinates nine counties
and 101 cities and towns in the San Francisco Bay
Region. ABAG projects funded by the CWSRF,
including trash capture devices for catchment
basins, provide widespread environmental
benefits to cities and towns in the region.
A.7. Intermunicipal Lending
Intermunicipal agencies are eligible for CWSRF assistance. An
intermunicipal agency is an agency established by two or
more municipalities with responsibility for planning and/or
management of public service. They can facilitate cross-
jurisdictional coordination and funding support for regional
solutions to water quality problems. The assistance recipient
could be a single entity within the agency or the agency
itself. For example, several jurisdictions could apply for a
CWSRF loan to an intermunicipal watershed agency where a
watershed is comprised of several states. These jurisdictions
could form an intermunicipal watershed fund (the agency) to
receive CWSRF financial assistance. The watershed fund
could create a portfolio of watershed projects eligible for
CWSRF assistance and deliver that assistance to recipients.
WRRDA amended section 122 of the CWA to introduce
several nontraditional eligibilities that could be supported by
intermunicipal lending, including CWSRF funding for
watershed management of wet weather discharges;
stormwater best management practices; watershed
partnerships; and integrated water resource planning. It is
also important to note that a CWSRF can provide any type of
authorized assistance to intermunicipal agencies, including
loan guarantees for so-called "sub-state revolving funds," for
eligible purposes.
A few CWSRF programs have taken advantage of this
authority by providing assistance to intermunicipal
organizations, as detailed in the sidebar. The cooperation
and coordination required in the development, funding and
implementation of such "joint' projects might prove to be a
formidable obstacle, even though municipalities coming
together for this purpose on a watershed basis would likely
yield significant economic and environmental benefits.
A.8. Interstate Lending
Interstate agencies are eligible for CWSRF assistance. This is a largely unexplored and underutilized
authority with enormous potential to directly target financial assistance at interstate pollution
problems, particularly with respect to funding nonpoint source pollution projects under section 319 of
the CWA and nontraditional estuarine projects under section 320 of the CWA. However, a few states
have been providing funding to interstate agencies preceding the passage of WRRDA and continue to do
so successfully.
22 | Page
-------
State Example: PENNVEST Provides Interstate Agency
Funding to Support Green Infrastructure Initiatives
The Delaware Valley Regional Planning Commission has
served the greater Philadelphia region since its
inception in 1965, through an interstate compact with
the State of New Jersey. The Commission provides
services to five counties in Pennsylvania and four in
New Jersey. These services include land use and
environmental planning, mapping, and data analysis.
The Pennsylvania Infrastructure Investment Authority
(PENNVEST) has provided over $2 million in CWSRF
grant assistance to the Commission for various green
infrastructure applications to address non-point source
pollutant loads. A project is located in Bucks County,
Pennsylvania, to plant a total of 3,355 trees in seven
municipalities to reduce erosion and sedimentation into
tributaries of the Delaware River, while also providing
shade and energy savings and improved air quality.
CWSRF programs are prohibited from making direct
loans to projects in another state even where they
would have significant water quality benefits to the
lending state. CWSRF programs can, however, provide
financial assistance to interstate agencies. For
example, interstate lending could occur in at least two
ways. An interstate agency could be established by (1)
congressional action or (2) by an agreement of two or
more states, as defined in Section 502(2) of the CWA,
with the agency given necessary authority to provide
financial assistance. A CWSRF would lend to this
entity which in turn would either off lend or even
make grants (or other types of assistance) to projects
in another state. The interstate agency would be
obligated to repay the loan.
As an example, the CWSRF programs of two
contiguous states, one "downstream" from the other
could, through mutual agreement, jointly lend (or
provide additional subsidies) to an existing or newly
created interstate agency. The participating CWSRF
programs would develop a portfolio of projects and the agency would use the pool of funds to address
the most serious sources of nonpoint sources problems in the "upstream" state.
State Example: Washington Interstate Lending
Spokane County Water and
Soil Conservation District
Project Area
15 counties - Eastern
Washington
4 counties - Northern Idaho
Ofc
\0
The District makes
loans to farmers for no-
till equipment, direct
seed drills, and
implements for residue
management
s
Pass-Through
Lending: Washington
CWSRF makes a low-
interest loan to the
District
*
Project Benefits include:
- Improved soil tilth
- Reduced soil erosion
- Better moisture content
- Stronger crop yields
- $13.50/acre cost savings
Figure 12 - Interstate Soil Conservation District
The Washington Water Pollution Control
Revolving Fund has been providing loans to
the Spokane County Water and Soil
Conservation District for two programs
supporting agricultural best management
practices: The Conservation Tillage and
Sediment Reduction Program and Eastern
Washington Sediment Reduction Program.
Together, these programs serve nineteen
counties spanning eastern Washington and
northern Idaho for the conversion from tillage
to direct seed/no-till farming practices. The
Washington CWSRF program has provided
over $18 million in loan assistance since 1995
and made laudable strides in protection water
quality in the region by reducing soii erosion
up to 90 percent while improving the overall
moisture of the soil for increased productivity.
23 | Page
-------
State Example: Arizona Planning and Design Technical Assistance
Grants
The Water Infrastructure Finance Authority (WIFA) administers the
CWSRF program in the state of Arizona and uses a portion of their fee
revenue to fund a planning and design program aimed at providing
much needed assistance to communities with limited resources who
need help in completing this kind of work. This funding is capped at
$35,000 per project with a 40% local match. Arizona's planning and
design program presents an excellent opportunity for communities
and their engineering consultants to pursue an integrated planning
approach that includes green infrastructure applications, watershed
management techniques, water and energy conservation measures, as
well as activities designed to increase the resiliency of the built and
natural environment. Applicants who include green project
applications as part of the scope of work may qualify for a waiver on
the local match component. Eligibility for this waiver is predicated on
WIFA's determination that the primary purpose or majority of the
project is green. For example, the City of Flagstaff received $35,000 to
pursue green stormwater infrastructure watershed planning and the
Alpine Sanitary District used their funding award to explore options for
using constructed wetlands to improve water quality of discharge to
the San Francisco River. This is a good example of incentivizing
integrated project planning while also providing valuable funding
assistance for non-traditional projects in the CWSRF program.
A.9. Planning and Design Lending
States can provide short-term loans to
fund integrated planning activities that
can be reasonably expected to lead to
an eligible capital project. The
assistance allows communities to
undergo a comprehensive planning
process that considers a full range of
options as well as cross-sector
priorities. By funding planning, CWSRF
programs increase the pool of capital
projects to fund. In fact, a planning and
design loan can be combined with an
agreement to move the resulting
capital project up the project priority
list to increase its chances of receiving
funding. In some states, the planning
and design loan becomes interest-free
or is forgiven if the borrower pursues
CWSRF construction financing. Loan
forgiveness is particularly helpful to
NPS projects. States can also fund
planning and design grants from their
program or non-program fee income.
B. Purchasing Local Debt Obligations
While making direct loans to public entities is the most common and traditional form of funding in the
CWSRF program, Title VI of the CWA also allows states the opportunity to provide assistance through
the purchase or refinance of local debt obligations under Section 603(d)(2). States may purchase, for
example, general obligation or revenue bonds issued by municipalities, intermunicipalities, and
interstate agencies within the state at or below market rates, so long as such debt obligations were
incurred after March 7, 1985.
Historically, bond purchasing programs have been attractive to larger borrowers pursuing infrastructure
projects bearing greater longevity than 20 years by allowing for extended maturities combined with low
interest rates. Offering terms up to 30 years (and potentially up to 45 years) or the useful life of the
project not only help the CWSRF to accommodate the capital improvement planning and budgeting
regimes incorporated by municipalities, but also come with competitive interest rates.
After the passage of WRRDA in 2014, all CWSRF programs may make loans for up to 30 years or the
useful life of the project via direct loan programs as a matter of course if they so choose. In January
2017, the EPA approved the Ohio CWSRF's request to offer 45-year extended financing terms to
qualified recipients by creating a revenue bond for the eligible borrower to issue in order to evidence its
repayment obligation. The arrangement also includes a trust agreement between the borrower and the
State articulating repayment obligations, covenants, and agreements. The instruments will be used for
financings with terms greater than 30 years, but no more than 45 years.
24 | Page
-------
In the context of financing nontraditional projects, the purchase of local debt presents a viable
alternative for intermunicipal borrowers, interstate agencies, public private partnerships, and
nontraditional projects with longer useful life expectancies including, but not limited to, land purchases,
conservation easements, and watershed restoration efforts.
Examples of Non-Traditional Projects with Longer Useful Life Expectancies
Green Infrastrcture
Urban forestry, tree canopy
establishment and restoration
Natural Systems for
Flood Attenuation
Tidal Wetlands
Living Shorelines
Habitat Protection and
Restoration
Removal of mine tailings
Artificial reef establishment
Restoring aquatic vegetation
Figure 13 - Long Useful Life Examples
C. Credit Enhancements
In 2016, Fitch rating agency announced that approximately 82 percent of state revolving funds and
municipal loan pools in the Fitch-rated portfolio are rated AAA. This underscores the stability of CWSRF
programs as a result of robust financial capability procedures, loan security mechanisms, and the
reliable nature of utility revenues. CWSRF credit enhancement for local debt taps the strong credit
position of state CWSRF programs to
buoy the credit rating of assistance
recipients, thereby lowering their
borrowing costs. This form of
assistance is eligible under section
603(d)(3)), "to guarantee, or
purchase insurance for, local
obligations where such action would
improve credit market access or
reduce interest rates."
With a credit enhancement
program, a highly-rated CWSRF
program guarantees third-party debt
(such as a bond issue) for a
municipality or utility with a weaker
credit rating. The guarantee
agreement between the CWSRF and
the assistance recipient results in
State Example: Pennsylvania's Credit Enhancement Assistance Program
The Pennsylvania Infrastructure Investment Authority (PENNVEST)
administers the financial duties of the Pennsylvania CWSRF program.
Recently, PENNVEST introduced Credit Enhancement Assistance into its
lineup of CWSRF offerings. The Credit Enhancement Assistance (CEA)
program was developed as a result of annual demand for funding that
exceeded PENNVEST's lending capacity, and as an effort to meet the
needs of medium-to-large communities by enabling the CWSRF to fully
fund their large projects.
PENNVEST wiil be able to tap into the CEA program in the future when
CWSRF loan capacity is exceeded. Although the agency is targeting to
make $150 million available for guarantees through the CEA, they have
remained within traditional lending capacity to date. Several large
municipalities in the state have expressed interest in CEA assistance;
however, PENNVEST has not yet received applications for the program
due in part to the current low interest rate environment.
25 | Page
-------
more favorable borrowing terms for the recipient, allowing the entity to take advantage of interest rates
similar to what it might receive on a traditional CWSRF loan. At the same time, this arrangement allows
the CWSRF program to stretch its assistance capabilities further since a guarantee does not require the
same cash outlay as a traditional loan (in general, a CWSRF program would need to consider the amount
of credit subsidy, if any, to reserve).
This form of assistance has not been widely used among CWSRF programs. Arizona provided the first
CWSRF guarantee in the year 2000 in the amount of $5.5 million. This remained the only instance of
credit enhancement until 2014, when the New York CWSRF introduced a guarantee program securing
borrowing for assistance provided for energy efficiency projects by the New York State Energy Research
and Development Authority. Prior to this, in 2010 New York set up their initial guarantee program with
the establishment of the 2010 Master Financing Indenture, which was first offered to eligible financial
assistance recipients in their 2011 Intended Use Plan.
State Example: The New York CWSRF Guarantees Bonds
for Residential Energy Efficiency Improvements
The New York Environmental Facilities Corporation
(NYEFC), lead state agency for the New York CWSRF,
participates in a first-of-its-kind guarantee partnership with
the New York State Energy Research and Development
Authority (NYSERDA). NYSERDA sought to issue bonds to
finance and refinance loans under the Green Jobs-Green
New York program, a statewide initiative that supports
energy efficiency improvements for residential, small
business, nonprofit and multi-family buildings. Because the
portfolio of small energy efficiency loans was relatively
new and untested, NYSERDA had difficulty securing an
acceptable bond rating. The agency turned to the NYEFC,
which agreed to provide a CWSRF guarantee for the
program.
Before the partnership proceeded, the NYEFC consulted Figure 14 - NYSERDA Structure
with the U.S. Environmental Protection Agency to ensure that the guarantee would be an eligible use of CWSRF
funds. New York State's Section 319 nonpoint source management program had already identified atmospheric
deposition, the particulate matter from burning fossil fuels to generate heat and electricity, as a significant
source of water quality impairment. Therefore, EPA concurred with NYEFC's assessment that energy efficiency
projects to reduce atmospheric deposition was an eligible use of CWSRF funds under section 603(c)(2) of the
Clean Water Act, which allows CWSRF funds to be used "for the implementation of a management program
established under section 319." (continued)
(NYSERDA continued) The guarantee is secured by CWSRF recipient payments and a pledge of available CWSRF
program equity. NYSERDA was also required to capitalize a collateral reserve account that is held separately by
NYSEFC and is not part of the bondholder guarantee pledge. The partnership allowed NYSERDA to obtain a
triple-A credit rating for the energy efficiency loan portfolio. Figure 14 shows the structure of the partnership
between NYSERDA and the New York CWSRF.
New York State
Environmental
Facilities Corporation
CWSRF Funds
Trust Fund Account
Bondholders
NYSERDA
Energy Efficiency
Borrowers
26 | Page
-------
D. CWSRF Bond Issuance
D.l. Traditional Bonds
The sale of bonds by or on the behalf of the CWSRF programs has produced a tremendous boost in
assistance provided. Since 1989, 29 CWSRF programs have leveraged their programs in this manner,
issuing approximately $42 billion in bonds to finance eligible projects.
CWSRF bonds can be sold to finance nontraditional projects, traditional projects, or both. Given the lack
of experience in the marketplace with many nontraditional projects, however, it may be prudent and
cost-effective to allocate funding to a pool of both traditional and nontraditional projects, or to finance
nontraditional projects solely through direct loans while using leveraged bonds to finance traditional
projects. Before issuing bonds, however, the program must have the capacity (e.g., free cash flows and
debt service reserve if necessary) to enter into debt, secure it, and make debt service payments. Equally
important is a sufficient pipeline of projects that are ready to proceed; therefore, the demand for
nontraditional projects should be carefully assessed along with their readiness to proceed before bonds
are issued. It may be necessary to implement an extensive marketing campaign to ensure adequate
demand.
D.2. Green Bonds
"Green Bonds" are municipal bonds issued
with a commitment to direct proceeds
exclusively toward environmentally beneficial
purposes. Although the terminology is new
(coined in 2008 by the World Bank), the
concept is tried-and-true for CWSRF programs
that have leveraged funds, since the proceeds
from leveraged bonds have always been used
for projects benefitting the environment. A
few state agencies involved in managing
CWSRF programs, including the Massachusetts
Clean Water Trust, the Indiana Finance
Authority, the Iowa Finance Authority, the
Rhode Island Infrastructure Bank, and the New
York State Environmental Facilities
Corporation, have adapted their traditional
leveraging programs to incorporate the
terminology of Green Bonds.
For the most part, Green Bonds are issued with
generally the same pricing and terms as the
issuer's standard bonds, but may be marketed
to different investors. In some cases, the
return on Green Bonds is linked to
environmental outcomes, such as in the case
of the country's first "Environmental Impact
Bond" issued in 2016 by the District of
State Example: Massachusetts Clean Water Trust's State
Revolving Fund Green Bonds
The Massachusetts Clean Water Trust (the Trust) oversees the
state's CWSRF program in cooperation with the Massachusetts
Department of Environmental Protection. The Trust has been
issuing bonds to leverage the CWSRF program since 1993. In
2013 the Trust issued its inaugural Green Bond, generating
$100 million in proceeds for clean water and drinking water
projects, energy efficiency in state buildings, open space and
land remediation, river revitalization, habitat restoration, and
providing the required state match for the FY13 State
Revolving Fund federal capitalization grants.
The agency pursued Green Bonds as a way to expand their
investor base, and found that the Green Bonds have attracted
a "broader and more attached investor base" (NRDC). The
expectation of broad investor interest was accurate as the
$100 million in Green Bonds garnered more than $130 million
in orders, an oversubscription of 30 percent.
In 2014, the Trust issued $231 million in State Revolving Fund
Series 18 Green Bonds. The proceeds were used to finance or
refinance costs of State Revolving Fund wastewater and
drinking water projects. According to the Preliminary Official
Statement, the Trust initially allocated CWSRF and DWSRF
funds separately to secure the Green Bonds, but maintained
the ability to "cross-collateralize" and use CWSRF program
funds to cure or prevent a default on the bonds issued to fund
the other purpose.
27 | Page
-------
Columbia Water and Sewer Authority (DC Water). Payments on the DC Water bonds will vary depending
on the environmental outcomes of the green infrastructure stormwater control project funded by bond
proceeds.
E. Guarantees Securing Sub State Revolving Fund Lending
The CWSRF programs have statutory authority to "provide loan guarantees for similar revolving funds
established by municipal or intermunicipal agencies" (Title 33 Subchapter VI §1383 (d)(3)). A guarantee
relies on the net assets of the CWSRF program to enhance the credit of the partnering agency, lowering
the partner's costs to borrow and lend capital. A guarantee from the CWSRF can help a municipal or
intermunicipal agency receive a better rating on bonds issued to capitalize the sub-revolving fund,
allowing savings to be passed on to sub-recipients. Likewise, the CWSRF could directly guarantee the
loans made from the sub-revolving fund, allowing the program to offer better rates to customers.
CWSRF programs may secure the guarantee by setting aside funds in a debt service reserve, or by
pledging CWSRF loan recipient payments if these payments are significant enough to collateralize the
bonds or loans. Because a guarantee involves no immediate outlay of funds, this option allows a CWSRF
to leverage the program's financial stability into a much larger source of funding than would be possible
through conventional loans. For instance, in the event a CWSRF program does not have adequate cash
flow to cover the entire cost of a very large project, a CWSRF guarantee could be combined with a
traditional CWSRF loan to offer the borrower full project coverage at a lower cost than non-guaranteed
market financing.
F. Additional Subsidies
Prior to 2009, the most favorable financial terms a CWSRF could offer was 0 percent financing. This
changed with passage of the American Recovery and Reinvestment Act of 2009, which enabled the
CWSRF programs to use a portion of their federal
capitalization grants to provide additional
subsidization in the form of principal forgiveness,
grants, or negative interest loans. The authority to
provide additional subsidization was continued by
subsequent annual appropriations and made
permanent by the WRRDA amendments of 2014.
Added by the WRRDA amendments, section 603(i)
of the CWA allows the CWSRF programs to provide
additional subsidization to a municipality or
intermunicipal, interstate, or state agency facing
challenges regarding affordability. The use of
additional subsidization is not restricted to only
addressing affordability. Section 603(j) also allows
additional subsidization to be provided to these
entities for projects that address water or energy
efficiency goals; mitigate stormwater runoff; or
incorporate sustainable project planning, design,
and construction. The total amount of a federal
capitalization grant that may be provided as
State Example: West Virginia Additional Subsidy
The rural, unincorporated community of Crown,
West Virginia is located in the lower part of the
Monongalia Watershed. For years, this community
was plagued with the overflow of raw sewage as a
result of sub-standard on-site wastewater
management systems. Effluent from these systems
was being discharged directly into ditches and local
streams. Due to severe economic hardship the
small, rural community was not in a position to fund
a solution to their water quality problems. To
address Crown's public health concerns, the West
Virginia Department of Environmental Protection
financed the construction of an innovative on-site
wastewater collection and treatment system. The
funding for this $1.58 million project came in the
form of $1.57 million in additional subsidization
from the CWSRF and $10,000 from the Monongalia
County Commission.
28 | Page
-------
additional subsidization can range between 0 percent to 30 percent, depending on the extent by which
the annual appropriation exceeds $1 billion.4 The WIIN Act, passed in December 2016, changed these
limitations. If a recipient implements a process, material, technique or technology to address water-
efficiency goals, to address energy-efficiency goals, to mitigate stormwater runoff, or to encourage
sustainable project planning, design, and construction, then they would be eligible for additional
subsidy.
Strategic targeting of additional subsidization in appropriate situations can greatly assist the funding of
nontraditional projects by reducing or eliminating the amount that must ultimately be repaid. This may
include situations where a project's inability to generate a sufficient revenue stream or other economic
difficulties are impacting a borrower's ability to repay a loan. When providing additional subsidization, a
CWSRF program should weigh the need of providing this type of assistance to an eligible recipient with
the impact it may have on the long term perpetuity of the fund.
4 The 2016 CWSRF annual appropriation included language directing each CWSRF program to provide 10% of its
capitalization grant as additional subsidization. This amount was in addition to what was allowed by the WRRDA
amendments and was not subjected to the various restrictions laid out in section 603(j). However, this amount
could only be used for initial financings or to buy, refinance, or restructure debt obligations incurred on or after
the date of enactment of the 2016 annual appropriation.
29 |
-------
Sources of Revenue
Funding nontraditional eligibilities with the CWSRF often involves identifying unconventional repayment
sources. While "traditional" pipe and plant infrastructure projects often have a stable revenue source in
the form of user fees or general taxing authority, many nontraditional projects lack these options.
Nontraditional projects are often sponsored by nonprofit organizations, individuals and private entities,
and may result in water quality benefits that do not generate any direct income. State CWSRF programs
have flexed their creative muscles to come up with a variety of revenue sources for nontraditional
projects. These examples, as well as additional options for future consideration, are outlined below.
REVENI
SOUICE
F EXAMPLE
Ohio's CWSRF provided a five-year, $60,000 loan for Uniform Services to conduct a site
assessment and cleanup on a brownfield site adjacent to its dry cleaning facility. The
loan will be repaid using a revenue stream from accounts receivable, with inventory
and cash as extra collateral.
* Includes resorts, schools, factories, and other facilities with onsite wastewater
treatment.
Business Revenues *
Carbon Credits
Equipment Rentals
Fees Paid by
Developers
Homeowner
Association Fees
The California CWSRF made an $18.7 million loan at 0 percent interest that allowed the
Yurok Tribe to acquire 22,237 acres of forestland to protect water quality and
beneficial uses. Carbon credits generated from sustainable harvesting practices provide
a partial repayment source and the tribe was required to provide a contract for the sale
of carbon reserves as a condition to receive funding.
Washington's CWSRF provides pass-through funding via the Spokane County
Conservation District to convert farmland to no-till, reducing sediment and nutrient
runoff. The Spokane County Conservation District operates a revolving fund (capitalized
by the CWSRF loan) to help farmers purchase direct seed equipment. It would also be
possible for a conservation district to use a CWSRF loan to purchase specialized
equipment to rent out to individual farmers, and use the rental income as a repayment
source for the loan.
The Ohio CWSRF has loaned a total of $3.0 million to Hemisphere Corporation to
remediate a 27.5-acre brownfield on the site of a former industrial park. Repayment
sources for the loan include rental fees from the completed project (to be redeveloped
for light industry); sales from clean soil on the site that will be used to cap a municipal
landfill; and fees from a licensed construction and demolition debris landfill placed on
the site of the excavated soil.
Although less common in the CWSRF program, Drinking Water State Revolving Fund
programs frequently make loans directly to homeowner's associations, which are
repaid by their fees. The state of Maryland CWSRF program made a $529,000 loan to
the Dennis Point Homeowners Association for an erosion control and shoreline
stabilization project. CWSRF loans could also be made to homeowners' associations for
decentralized systems and other eligible projects.
30 | I
-------
Membership Fees
Nutrient Credits
On-Bill Financing
Permit Fees
Property Tax
Recreational or
License Fees
Resort Taxes / Fees
Nutrient Impact Fee
The Ohio CWSRF awarded a $110,000 loan to the Nature Conservancy to purchase a
conservation easement to protect and restore a threatened section of Brush Creek. The
nonprofit repaid the loan from their general operating account, which includes
membership dues and fundraising assets.
PENNVEST, the lead state agency for Pennsylvania, operated a clearinghouse for
nutrient credit trading in the Chesapeake Bay watershed. For all credit-generating
projects funded by the CWSRF, PENNVEST owned credits up to the value of the CWSRF
subsidy. PENNVEST provided a $7.8 million loan for the construction of a manure
management system on a dairy and egg farm in Lancaster County. The loan will be
repaid entirely by nutrient credit sales, and will also share in credit sales in excess of
the amount needed to repay the loan, as compensation for risk.
One-time nutrient impact fees on new hookups to water and sewer systems raised
funding for land protection projects and landowner outreach and negotiation in
Raleigh, North Carolina. These fees were based on avoiding more than 7,970 pounds of
nitrogen and 1,415 pounds of phosphorus from entering local reservoirs.
On-bill financing is a method typically used to secure repayment for improvements for
individual homeowners or businesses, such as water or energy efficiency
improvements or septic repair and replacement. Funds for the improvements are
passed through the local utility, and repayment occurs via a charge added to the
customer's regular utility bill.
The New York CWSRF program provided a guarantee for bond issuance by NYSERDA to
provide loans secured by an on-bill financing program (see page 26).
The Nebraska CWSRF provided a $10.7 million loan to the Petroleum Release Remedial
Action Fund to remediate leaking petroleum storage tanks. The loan was repaid from
permit fees on tank owners and volume fees on petroleum products.
The Massachusetts CWSRF Community Septic Management Program utilizes a
"betterment agreement" that channels loans through a municipality to individuals for
septic system improvements, and allows the municipality to ensure that the loan is
repaid as part of a property tax bill. The municipality can place a municipal lien on
property if the homeowner defaults on the loan.
Fees such as boating permits, fishing licenses, or entrance fees provide a repayment
source for CWSRF-funded projects that protect water quality in recreational areas.
Many areas use resort taxes or fees to fund water quality efforts. Big Sky, Montana
uses resort tax dollars to fund water and sewer improvement projects. The Montana
Water Pollution Control SRF program has loaned $19.4 million to the Big Sky County
Water and Sewer District for wastewater treatment plan improvements, and resort tax
dollars could be used as a repayment source.
In Whitefish, Montana a 1 percent resort tax was assessed to raise approximately $1.0
million annually to repay a loan from Montana's Water Pollution Control state
revolving fund. The loan was used to finance easement costs to safeguard the Haskill
Basin water source.
31 I
-------
Severance Taxes
Sale of Treatment
Process Residuals
Sale of Water Rights
Sales Revenues
Sales Tax
Sale of Excess Energy
/ Energy Savings
Performance
Contracting
A state levy tax on the extraction of non-renewable natural resources which can be
used to pay for a variety of programs, including water development.
Energy Savings Performance Contracting (ESPC) is a financing tool that allows facility
owners to pay for building improvements that reduce energy and water use, without
utilizing their capital budgets. By partnering with an energy service company (ESCO), a
facility can use an ESPC to pay for today's facility upgrades using the money saved
through lower utility bills in the future. The Hawaii DWSRF program is in the process of
funding ESPC efficiency upgrades for Honolulu Board of Water Supply facilities, with
the goal of reducing energy demand by 20 percent.
Oregon's loan to the Farmer's Irrigation District (FID) to convert unlined irrigation
canals to a piped, pressurized system also provided an opportunity for FID to install
micro hydroelectric equipment within the new pipes. This technology generated over 2
million kWh per year for FID, equivalent to one month's electrical supply cost. The sale
of the excess energy is helping the District pay off their CWSRF loan ahead of schedule.
Pittsfield, Massachusetts received $1.7 million from the Massachusetts CWSRF to
install a Combined Heat and Power (CHP) system at the Pittsfield wastewater
treatment plant. The system is projected to save the utility $206,000 each year,
resulting in an 8-year payback period on the CWSRF loan.
Residuals from the wastewater treatment process have been shown to have value in
several markets, including land application, cement manufacturing, brick making, turf
farming, composting, commercial topsoil, road subgrade, forest land application, citrus
grove application, nutrient control, landfill cover, land reclamation, and hydrogen
sulfide binding. For example, the City of Tulsa, Oklahoma operates a water treatment
plant treating surface water from reservoirs using alum as the primary coagulant. Alum
residuals from the treatment plant were used by a local cement company located in
close proximity to the plant. The alum residuals were added to the cement blend in
place of shale rock.
The Oregon CWSRF provided funding to the Farmer's Irrigation District (FID) to convert
unlined irrigation canals to a piped, pressurized system. The project saved so much
water that FID was able to sell excess water rights to finance the creation of
permanent, in-stream habitat for endangered fish species. When CWSRF-funded water
efficiency projects result in excess water rights, revenue generated from the sale of
those rights could be used to repay the CWSRF loan.
The California CWSRF made an $18.7 million loan at 0 percent interest to the Yurok
Tribe for the acquisition of 22,237 acres of forestland to protect water quality and
beneficial uses. Revenue from the sale of timber on the parcel is providing a partial
repayment source.
The state of Wyoming assesses a small gas severance tax on every gallon of gas (as well
as special fuels) sold or distributed in the state. In the past, this tax revenue provided a
repayment source for $233.0 million in CWSRF loans to the Wyoming Department of
Environmental Quality. The loan was used to contract for site investigations and
cleanup work at leaking underground gasoline storage tank sites throughout the state.
32 | Page
-------
Special Assessments
Stormwater Fees
Tax Revenues from
Contaminated Site
Redevelopment
Traditional Municipal
Repayment Sources
(including user fees
and tax and utility
revenues)
Watershed Protection
Fees / Taxes
The Florida State Revolving Fund program will partially fund an expansion of Cape Coral
Utility to provide potable water, sewer and irrigation reuse to the area. The loans will
be guaranteed by a special assessment to be paid by all property owners in the
expansion area. An average 10,000 square foot lot will be assessed approximately
$10,000 for the water, sewer and irrigation infrastructure, pipes and pumping station,
while an additional assessment will be levied for a "capital facility expansion charge."
Special assessments for infrastructure improvements may also be levied on utility bills.
The State of Maryland assesses a $5.00 monthly fee on every household served by a
wastewater treatment system to capitalize the Bay Restoration Fund, a source of
funding for efforts to protect and restore the Chesapeake Bay.
Many municipalities across the country charge a stormwater fee to property owners
based on impervious surface area. These fees are typically used to finance stormwater
control projects.
In 2012, the city of Marathon, Florida received a $4.6 million CWSRF loan from the
Florida Department of Environmental Protection for a project implementing
wastewater collection and reuse and a stormwater vacuum trench exfiltration system.
Marathon pledged proceeds from its "stormwater utility service assessments" as a
repayment source for the loan.
A preliminary EPA analysis (see sources section) of 48 brownfield sites showed that an
estimated $29.0 million to $97.0 million in additional tax revenue was generated for
local governments in a single year after cleanup. This source of revenue could be used
by municipalities to repay a CWSRF loan for contaminated site remediation.
CWSRF assistance to traditional projects is typically secured by user fees that utilities
charge their customer base for water and wastewater service. Embedding
nontraditional projects such as green infrastructure in these assistance agreements
allows user fees to be the revenue source (see Sponsorship Lending on Page 16).
An increasing number of municipalities and utilities are incorporating nontraditional
elements, such as green infrastructure and water reuse, into their wastewater and
stormwater capital improvement projects. When this occurs, the traditional revenue
sources (such as tax revenues and user rates) also function as a repayment source for
the nontraditional aspects of the project.
All Raleigh, North Carolina water customers pay an on-bill watershed protection fee.
The fee is used to conserve critical land in the watershed to provide protection for
drinking water sources and reduce treatment costs. The watershed protection fee is 10
cents per thousand gallons of water used (approximately 45 cents per month per
customer), and is expected to generate $1.8 million per year.
33 |
-------
IV. Strategic Plani aport the Financing of Nontraditional Projects
A. Planning
Amidst the wide variety of financing mechanisms available to CWSRF programs in efforts to expand the
types of projects that can be funded, as well as broadening the existing customer base, the real success
of these initiatives starts with effective strategic planning. A holistic approach to strategic planning takes
into consideration the nexus between internal workflow and staffing, assigned roles and responsibilities,
established procedures, financial modeling capabilities, and the alignment of the CWSRF project
portfolio with water quality priorities and challenges that have been identified in the state. This is
especially true when programs wish to broaden the scope of financial assistance provided toward
nontraditional project types which may require the use of alternative sources of revenue to secure the
loan, or a more detailed risk analysis to ascertain credit worthiness or project viability.
Financial Modeling
Accurate financial modeling capabilities are critical to an overall strategic management approach, as this
information provides the foundation upon which financing capabilities are determined prior to
coordinating with key borrowers and entering into discussions about binding commitments. Financial
modeling allows states to evaluate how different demand levels, interest and loan fee rates, lending
terms, capitalization grants and state match, and leveraging or bond issuances impact their cash flows.
The ability to perform financial forecasting with a degree of certainty in both a short-term and long-term
context helps the program to best serve customers and ensure the optimal financial health and
performance of the CWSRF program. Programs should use these tools to determine what funding levels
to allocate toward nontraditional project initiatives, such as stormwater management or assistance for
decentralized wastewater treatment systems, while also maintaining capacity to provide continuous
service to repeat borrowers as part of a project portfolio diversification strategy.
Running cash flow projection scenarios at several intervals during the annual funding cycle will
determine the funding levels available to borrowers. This is typically done on a quarterly basis, at the
commencement of the state fiscal year, and represents the first step in kicking off the annual CWSRF
workflow process.
Another resource is the SRF Fund Management Handbook, which provides guidance on strategic
approaches to managing revolving fund programs.
Using Cash Flow Projections and Programmatic Financing to Achieve Steady State Funding
With increased scrutiny on the timely and expeditious use of federal funds, there is increased interest
among states in achieving a steady-state funding environment where the amount of new commitments
and outlays runs in tandem. Using a programmatic financing approach accompanied by cash flow
projection and modeling is a good combination for reaching steady state funding, while capturing a wide
range of eligible project types to be funded simultaneously.
34 | I
-------
Example of Steady State Funding using Programmatic Financing
CWSRF Selected Fund Resources FY 2016 - FY 2040
^^Outlays
Total Funds Available
New Commitments
Cash Balance
t? n? n? Tr n? T? ^ ^ -i? -V0 n? i? # n? n? -F
Figure 15 - CWSRF Selected Fund Resources FY 2016 - FY 2040
This example captures the transition from a traditional, project-specific funding environment in years
2016 and 2017, to a programmatic financing environment beginning in 2018. The model includes all
active disbursements, plus repayments of principal, interest, and fee for loans signed prior to 2016.
Activity from 2017 forward is based on annual funding level assumptions. Using a cash flow projection
model calibrated to maintain a minimum working capital balance around $10 million, a CWSRF program
can strategically plan for commitment and outlay targets in a long-term context to attain a steady state
funding environment that ensures federal dollars are spent down and revolved quickly.
Annual Workflow
Developing an internal annual workflow cycle that includes specific trigger events helps CWSRF
programs to anticipate, budget, and plan for program-building activities throughout the fiscal year. Such
triggers are best broken out into annual, quarterly, monthly and weekly activities that include, but are
not limited to:
Assessing the existing project portfolio and how effectively the CWSRF program is addressing
water quality priorities in the state;
Identifying opportunities for expansion of the CWSRF customer base;
Identifying annual funding goals and CIP coordination with key borrowers;
Coordinating project selection and potential CWSRF financing discussions with existing and
potential borrowers;
Identifying readiness-to-proceed (RTP) activities, their duration, and what percent (if any) has
already been completed;
Developing a baseline for RTP activities (e.g., land acquisition, planning, design, preliminary
engineering reports and facilities plans, environmental review, permitting);
35 | Page
-------
Determining timing for projects in current and concurrent fiscal cycle;
Regularly updating project timelines (quarterly) to prevent slippage.
Staying on top of the day-to-day tasks of operating a CWSRF program can make it difficult to assess the
program's trajectory over the course of the year. By tying strategic program-building activities to
triggers that naturally occur during the annual funding cycle, strategic planning then becomes a routine
element of CWSRF operations. It also allows the CWSRF program to maintain tight controls on the
project pipeline to ensure that funds are flowing continuously.
The establishment and implementation of routines and procedures fosters an organized work flow and
provides an automatic response to any potential hiccups in the loan process, while also improving the
overall customer experience by reducing uncertainty and presenting a professional public image.
Strategic Program Activities Tied to Annual Funding Cycle
ANNUAL ACTIVITIES
CiP coordination meetings with key borrowers
Help borrowers identify which projects to push
forward
Identify opportunities for expansion of customer base
QUARTERLY ACTIVITIES
Update project priority list
Update financial / cash flow model
MONTHLY ACTIVITIES
Inspect projects
Process batched disbursements
WEEKLY ACTIVITIES
Work-in-progress meeting (all staff)
->
Analysis of project needs and water quality priorities
Marketing / Outreach
Update rules, policies and procedures
Strategy meeting
Assess progress towards annual funding goals
Develop project milestone schedule
Adjust marketing activities if necessary
Inspection report with project progress and
challenges
Update milestone schedules
Update financial / cash flow model
= Triggers Activities
Figure 16 - Strategic Program Activities
36 | Page
-------
B. Marketing and Outreach
A communications strategy to effectively market the CWSRF program and educate existing borrowers,
new customers, and a wide range of stakeholders is a necessary driver of strategic planning. The
strategic planning effort provides the information necessary to cultivate a targeted marketing campaign
designed to resonate with key stakeholders, address water quality priorities, and support the program
goals and objectives that have been identified through the expansion of nontraditional projects. As such,
the communications strategy is dynamic and constantly shifting as programs successfully overcome
obstacles, meet goals, and identify new challenges and changing circumstances.
Successful marketing begins with successful messaging. The most effective communications strategies
tailor their message to a specific audience or demographic, as well as employ a vast array of delivery
mechanisms to best accommodate the specific preferences of that audience for maximum impact. This
requires using a suite of media options that include personal communications and outreach, printed
material, audiovisual material, and use of social media.
Marketing Delivery Mechanisms
PERSONAL OUTREACH
PRINTED MEDIA
- Surveys and Focus Groups
Brochures
Professional Workshops and Training
Newsletters
Seminars
Reports
Working with Local Community Groups
- Developing Partnerships
PHOTOS AND VIDEOS
SOCIAL MEDIA
Nontraditional Project Features
Announcements and Funding Opportunities
- Interviews
Promotion of Nontraditional Project
- Infographics, Schematics, Graphic
Initiatives
Interchange Format (GIFs)
Success Stories
Figure 17 - Marketing Delivery Mechanisms
37 | Page
-------
State Example: Oklahoma -
Transforming Benefits Reporting into a
Triple Bottom Line Planning and
Marketing Tool
The Oklahoma Water Resources Board
developed an interactive, web-based
planning tool called Oklahoma
Advantages Assessment and Scoring
Infrastructure Solutions (OASIS). It
helps communities to quantify the
environmental, social, and economic
benefits of their wastewater
infrastructure investments in empirical
and qualitative terms. Using state-
specific data sets, OASIS examines a
variety of metrics to articulate how
CWSRF projects benefit local
communities in numerous ways.
The resulting output statements assist
community leaders to:
Assist in future planning efforts
Identify specific areas for
improvement
Consider using multiple options to
better plan for short term and
long term goals
Augment public relations,
outreach and marketing efforts
Generate interest in what the
CWSRF has to offer to constituents
Convey the connection between
water quality and quality of life
Turning Program Requirements into Marketing Opportunities
Every state CWSRF program must prepare certain printed materials as
part of regulatory requirements, specifically the Intended Use Plan
(IUP) and the Annual Report. Because these documents must be
prepared in order to satisfy program compliance, they present CWSRF
programs with an excellent opportunity to allow them to work to their
advantage. Re-thinking the form and function of the IUP to transform it
into an engaging, informative tool that resonates with stakeholders
and the public is an easy way to enhance any CWSRF program's
marketing efforts. The Oklahoma Water Resources Board (OWRB)
oversees the CWSRF program and has mastered the art of
transforming the IUP into an attractive, effective marketing tool. This
full-color publication is a digestible 40 pages featuring maps of projects
funded, side-bar features highlighting community and staff
accomplishments, easy to understand charts and graphs articulating
the cost benefits of using the CWSRF program, as well as photographs
of projects and community leaders. In particular, OWRB successfully
uses the IUP to market nontraditional project initiatives that support
water conservation, non-point source pollution from urban
stormwater and agricultural run-off, as well as total integrated water
resources management planning.
Facts are Friendly: Surveys and Focus Groups
One of the most useful tools in any communications strategy is the use
of surveys and focus groups. States that take the time to reach out to
borrowers and stakeholders in this way garner valuable and honest
feedback on program strengths and weaknesses. Surveys offer one of
the most efficient pathways to identifying areas for improvement,
opportunities to expand the customer base, as well as the types of
projects that are funded.
Survey results support a good foundation to explore these areas even
further by posing carefully targeted questions to focus groups
comprised of a variance of stakeholders in a neutral setting where
honest feedback is encouraged and anonymity is assured. Focus
groups have been conducted in Texas, Iowa, and Missouri and have
proven an invaluable source of candid, in-depth feedback from SRF
stakeholders. Even negative feedback can be transformed into a
chance to implement continuous improvement measures to help
borrowers navigate and participate in the CWSRF program with greater
ease. Both Texas and Iowa's experience with focus groups yielded
information used to improve customer service, website content and
guidance materials, and helped the states undertake re-branding
efforts to better appeal to potential SRF customers. Surveys and focus
38 | Page
-------
groups have proven to be a simple, low-cost way to gather valuable input used to guide program
changes, improve any negative perceptions that may exist, and shape the framework of the overall
communication strategy.
The Power of the Senses
Nothing creates interest and excitement about the exploration of nontraditional projects, how the
technology works, practical application, and their associated benefits quite like seeing the technology in
action. There are a number of message delivery mechanisms available that use audio, visual or both to
deliver powerful and memorable messages about the importance of these types of projects.
Audio/Visual Tools Cost &
Effectiveness
Effectiveness
SrtK Website £ Social Media * Videos
Bro ch u r e s/N ewsl ette rs
SRF Websites
Social Media
Videos
Brochures/
Newsletters
First stop for anyone looking for
more information. Should include
instructions and effective
messaging
Increasing popularity among any
stakeholder to stay in touch
Decision-makers looking for
innovative success stories and
potential applicants.
Applicable to all stakeholders.
May be mailed, emailed, or
handed out in person.
Good design is essential. Mobile-
ready is key today
Quickly share success stories and
program development. Must be
updated frequently.
Tool to share innovative projects.
High cost, but one or two may be
effective.
Must be well-designed and
succinctly provide message.
Newsletters should come out
several times a year.
Figure 18 - Audio/Visual Tools for Marketing
The EPA recognizes a strong communications strategy as a key variable in the overall success of the
CWSRF program and has created a sub-workgroup dedicated to developing options, examples, and
guidance on best practices for marketing and outreach endeavors in the CWSRF. This includes the
participation of five state CWSRF programs (Florida, North Carolina, New Hampshire, Oklahoma and
Oregon) who conducted a comprehensive survey effort to borrowers and consultants alike and whose
findings have to develop the structure of the Model State Marketing Plan. This document is designed to
be a vital resource to states as they develop and refine their respective communications strategies.
39 | Page
-------
References
Additional Resources
Overview of Clean Water State Revolving Fund Eligibilities, May 2016. https://www,epa,gov/cwsrf/overview-
clean-water-state-revolving-fund-eligibilities
SRF Fund Management Handbook, https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockev=20004lA2.txt
Credit Enhancements for Local Debts
"Fitch: Over 80 percent of State Revolving Funds and Municipal Loan Pools Garner 'AAA' Ratings."
BusinessWire. Berkshire Hathaway, October 31, 2016.
"Loan Guarantees: Policy and Programmatic Considerations." Paul K. Marchetti. Council of Infrastructure
Financing Authorities conference, November 5, 2013.
Personal communication with Brion Johnson, Deputy Executive Director for Project Management, PENNVEST
(November 4, 2016).
Green Bonds
Forester Daily News, "Mr. Green Goes to Washington." Janice Kaspersen. October 4, 2016.
"Green Bonds" presentation by Lisa Daniel, PFM. CIFA National SRF Workshop, November 12, 2014.
"How to Issue a Green Muni Bond." The Natural Resources Defense Council (NRDC).
https://www.nrdc.org/sites/default/files/greencitybonds-ib.pdf
"Preliminary Official Statement Dated November 25, 2014." Massachusetts Clean Water Trust State Revolving
Fund Bonds Series 18 (Green Bonds), http://www.mass.gov/treasury/docs/mwpat/mcwt-ma-state-revolving-
fund-bonds-series-18-pos.pdf
"MassGreenBonds 2013 Series D First Quarter Investor Impact Report (Quarter Ending August 2013)." Mass
Bond Holder.
Linked Deposit
Maine CWSRF 2015 Intended Use Plan and 2015 Annual Report.
http://www.maine.gov/dep/water/grants/srfparag.html
Maine.gov Department of Agriculture, Conservation and Forestry "Maine Forestry Direct Link Loan Program."
https://wwwl.maine.gov/dacf/mfs/policy management/water resources/direct link loan.html
John True, Engineering Services Manager/CWSRF Program Manager, Maine Department of Environmental
Protection.
Intermunicipal Lending
Clean Water State Revolving Fund Benefits Reporting System report generated November 2, 2016.
Press release, "Missouri Department of Natural Resources Awards $1,000,000 State Revolving Fund Grant to
Missouri Association of Councils of Government." August 8, 2012.
Interstate Agency Funding
"Governor Corbett Announces $79 Million Investment in Water Infrastructure Projects in 16 Counties," PR
Newswire, October 23, 2012. http://www.prnewswire.com/news-releases/governor-corbett-announces-79-
miljion-inyestment-in-water-infrastructyre-proiects-in-16-counties-175447981.html
40 | I
-------
Washington State CWSRF & 319 Programs. State of Washington Department of Ecology Presentation.
http://www.gwpc. o rg/sites/d efa u It/fi les/fi les/State%20of%20Washington%20-%20K%20Weisman(l). pelf
Direct Seed Loan Program, Spokane Conservation District. http://sccd.org/programs/direct-seed~loans
Delaware Valley Regional Planning Commission Board Committee, Meeting Minutes May 26, 2011.
httpi//www.d₯r|3c.org/Committees/Board/2011-05.pdf
Pass Through Lending
Funding Guidelines State Fiscal Year 2016 Water Quality Financial Assistance. State of Washington Department
of Ecology. httpsi//fortress.wa.gov/ecy/publications/publications/1410045.pdf
Washington State Department of Ecology Clean Water State Revolving Fund Focus on Nontraditional Projects.
Jeff Nejedly, Water Quality Program Section Manager. 2012 CIFA SRF National Workshop.
Planning and Design Technical Assistance Grants
Arizona Water Infrastructure Finance Authority's Clean Water Planning, Design and Technical Assistance Grant
Project Examples located at httpi//www.azwifa.gov/technical-assistance-program/.
Portfolio Lending
Thomas Montgomery, Florida Department of Environmental Protection. "Segment Caps and Forward Funding"
presentation at the EPA Region 4 SRF Workshop. June 17, 2015.
The Narragansett Bay Commission, "Resolution No. 2014:26." Adopted 12/9/14.
Purchasing Local Debt Obligations
U.S. EPA Approval of Ohio Clean Water State Revolving Fund (CWSRF) 45-Year Extended-Term Financing
Proposal dated January 11, 2017.
Image of mine tailings from San Vicente Creek Mill, New Mexico, https://onrt.env.nm.gov/assessment-cases-
restoration-proiects/damage-assessment-cases/chino-cobre-and-tyrone-mines/#SANVICENTE
Sources of Revenue
EPA Activity Update, "Innovative Uses of Clean Water State Revolving Funds for Nonpoint Source Pollution."
Office of Water, EPA 832-F-02-004 (July 2002).
"Funding Estuary Projects Using the Clean Water State Revolving Fund." USEPA Office of Water, EPA832-F-98-
005 (October 1998).
AWWA Research Foundation (2000). Commercial Application and Marketing of Water Plant Residuals available
at http://vyvyyy.vyqrldcat.org/title/commercial-applicatjqn-and-marketing-of-water-plant-resicuals-i-e-
Chai Wong, Shutsu. "Tapping the Energy Potential of Municipal Wastewater Treatment: Anaerobic Digestion
and Combined Heat and Power in Massachusetts." Massachusetts Department of Environmental Protection
(July 2011).
U.S. Environmental Protection Agency. "Water Conservation in Oregon - Farmers Irrigation District." YouTube,
January 22, 2016. Web. November 17, 2016.
Reichers, Dan. "Water Fee Aims to Fill Gap in State Funding." Raleighpublicrecord.org, February 21, 2012.
Web. November 17, 2016.
United States Environmental Protection Agency. "Fact Sheet: Funding MTBE Prevention and Remediation
Projects with the Clean Water State Revolving Fund." Office of Water (4204). EPA 832-F-00-004 (August 2000).
"North 2: Litmus Test." Cape Coral Daily Breeze.com, February 12, 2016. Web. November 21, 2016.
Hubbard, Joe and Jennah Durant. "EPA Announces $1.22 Million to Assess and Clean Up Contaminated Sites,
Promote Economic Redevelopment in Ark." EPA News Release, May 23, 2016. Retrieved from
41 |
-------
https://www.epa, gov/newsreleases/epa-gjyes:38m-help-19-commu nities-plan-new-uses-former-brownfield-
sites-0. November 21, 2016.
Walker, Laura, Roberg Morgan and Peter Stangel. "Leveraging Source Water Protection Programs Through
Effective Partnerships." Journal - American Water Works Association. January 2017, Volume 109, Number 1.
http://www.awwa.org/publications/iournal-avyvya/abstract/articleid/63106987.aspx
Sponsorship
EPA Activity Update: Ohio's Restoration Sponsor Program Integrates Point Source and Nonpoint Source
Projects. June 2002.
Watershed Management
California Legislature, Bill AB240 signed on September 27, 2016 located at
http://leginfo.legislature.ca.gov/faces/billCompareClient.xhtmj7bill id=201520160AB2480
"California Clears Path for New Watershed Funding" by Vince Tenoria of the Conservation Finance Network on
February 17, 2017, located at http://wvyyy.conseryationfjnancenetyyork.org/2017/02/15/californja-clears-
path-for-new-watershed-funding.
Long Creek Watershed Management District Overview.
http://www.restorelongcreek.org/pages/general/overview
Other
Bloomberg BNA. Financing Integrated Green Stormwater Infrastructure to Improve Community Health,
Resiliency - Getting the Best Deal for the Money!
Green Bonds in the SRF Future: Industry Practices and Update. CIFA Conference 2016
Tapping into Alternative Ways to Fund Innovative and Multi-Purpose Water Projects: A Financing Framework
from the Electricity Sector. Stanford University.
NRDC Issue Paper: Using State Revolving Funds to Build Climate Resilient Communities
The Environmental Forum. States and Localities Are Finding a Huge Potential in Green Bonds. Breggin, Linda K.
EPA Handbook on Coordinating Funding for Water and Wastewater Infrastructure: A Compilation of State
Approaches. October 2003.
James T. Gebhardt, CFA. SRF Guarantees: The Federally Sponsored State Revolving Funds' Untapped
Dimension and the Value Proposition for Putting It to Work.
42 | I
------- |