Current through Register Vol. 50, No. 9, March 1, 2024
RELATES TO:
KRS
224A.011,
224A.035,
224A.040,
224A.050,
224A.050
-224A.314
NECESSITY, FUNCTION, AND CONFORMITY:
KRS
224A.040 authorizes the Kentucky
Infrastructure Authority to make grants as funds are available, and
KRS
224A.070(1) authorizes the
Kentucky Infrastructure Authority to promulgate administrative regulations that
shall define with specificity conditions precedent under which applications for
loans or grants may be made and the order of priority upon which applications
shall be acted upon.
KRS
224A.300 requires the authority to promulgate
administrative regulations requiring a government agency, as defined by
KRS
224A.011(4), or a water
association administering a water or wastewater system. This administrative
regulation establishes procedures for the application for and provision of
financial assistance to governmental agencies for the construction of
infrastructure projects from funds available to the Kentucky Infrastructure
Authority.
Section 1. Definitions.
(1) "Applicant" means a governmental agency
that has submitted an application to the authority for a loan or grant from
authority funds.
(2) "Application"
means an application submitted by an applicant for grant from the authority
funds.
(3) "Conditional commitment
letter" means a letter delivered to the applicant stating the authority's
commitment to provide a grant under specifications and subject to the
satisfaction of certain conditions by the applicant.
(4) "Kentucky State Clearinghouse" means the
project review mechanism, attached to the Department for Local Government,
established in
KRS
45.031
(5) "Kentucky Uniform System of Accounting"
means the elements of a basic accounting system, including a standardized
format for an annual budget, a chart of accounts with definitions, and a
monthly operating report to system managers established by the authority, which
is used by a water or wastewater system seeking or using funds of the authority
if an alternative accounting system has not been approved by the
authority.
(6) "Project" means an
infrastructure project related to drinking water or wastewater.
Section 2. Eligible Projects.
(1) Funds available to the authority shall be
used to fund projects.
(2) Only
projects addressing one (1) or more of the following conditions shall be
eligible for funding:
(a) The proposed project
to be funded shall be water or sewer related;
(b) The proposed project shall address the
provisions of KRS 224A.300-224.314;
(c) The proposed project shall address an
emergency situation;
(d) The
proposed project shall alleviate existing conditions that pose a serious and
immediate threat to the health and welfare of the community;
(e) The proposed project shall promote
economic development;
(f) Funds for
economic development projects shall not be used for creation of industrial
sites without committed occupants;
(g) Funds are needed to complete funding
package;
(h) Funds are needed to
cover cost overrun for funding package;
(i) All proposed projects shall be subject to
availability of funds; and
(j)
Project applications meeting the guidelines established in paragraphs (a)
through (i) of this subsection shall be funded in the order received.
(3) Grants shall be limited to not
more than $500,000 per project.
Section 3. Applications.
(1) Each applicant shall submit one (1)
original application to the authority at the address specified in the
application.
(2)
(a) An application shall be submitted on Form
KIA-08-01, Unobligated Bond Pool Fund Uniform Grant Application, posted on the
following Web site:
http://wris.state.ky.us/kia/.
(b) Only a completed application, including
all supporting documentation, shall be considered for financial assistance from
the Unobligated Bond Pool.
Section 4. Project Priority. Eligible
projects shall be funded in the order received subject to the availability of
funds.
Section 5. Additional
Conditions to Project Funding.
(1) A water
supply and distribution system seeking funding for a project shall:
(a) Submit with the application current
information regarding the financial, managerial, and technical aspects of its
system;
(b) Update the information
provided pursuant to paragraph (a) of this subsection, at least once each year;
and
(c) Agree, in writing, to adopt
and utilize the Kentucky Uniform System of Accounting and to charge rates for
services based on the actual cost of that service.
(2) Before funds shall be disbursed to an
applicant whose project has been approved for funding, the applicant shall
demonstrate to the authority that the project:
(a) Has been reviewed through the Kentucky
State Clearinghouse process; and
(b) Is in compliance with applicable state
and federal requirements.
Section 6. Terms of Financial Assistance.
(1) An application for funding shall be:
(a) Subject to financial viability review by
authority staff; and
(b) Referred
to the board of directors of the authority for final action.
(2) A project shall be funded if
approved by the board of directors of the authority and the Capital Projects
and Bond Oversight Committee.
(3)
Upon approval of an application for funding of a project, the authority shall
issue a conditional commitment letter to the applicant establishing the
requirements to be satisfied by the applicant prior to execution of an
assistance agreement, including:
(a)
Accounting standards or financial reporting conditions;
(b) Rate covenants;
(c) Other federal or state legal requirements
relating to the project or the applicant;
(d) Engineering or technical requirements;
and
(e) Receipt of additional
funding commitments from other sources.
(4) Financial assistance by the authority
shall be made available only upon:
(a)
Execution of an assistance agreement; and
(b) Satisfaction by the applicant of the
conditions established in the conditional commitment letter.
(5) A grant amount may be adjusted
by up to ten (10) percent from the principal amount approved by the board of
directors without the need for further action by the board if:
(a) Requested by an applicant; and
(b) The staff of the authority finds that:
1. The additional requested amount is needed
for the project; and
2. Adequate
funds are available up to $500,000 total per grant.
(6) The Authority shall monitor
the assistance agreements and require that financial reports be made available
to the authority by the governmental agency.
(7) The Authority shall monitor the cash
flows of the project and perform all actions that shall be required to assure
that the agreements continuously meet the program standards established by this
administrative regulation.
(8)
(a) The authority shall collect an annual
administrative fee of one-half(1/2) of one (1) percent charged on the principal
grant amount.
(b) This fee shall be
applied to the administrative processing servicing costs of the grants and
necessary operating expenses of the program.
Section 7. Incorporation by Reference.
(1) "Form KIA-08-01 Unobligated Bond Pool
Fund Uniform Grant Application", is incorporated by reference.
(2) This material may be inspected, copied,
or obtained, subject to applicable copyright law, at the Kentucky
Infrastructure Authority, 1024 Capital Center Drive, Suite 340, Frankfort,
Kentucky 40602, (502) 573-0260, Monday through Friday, 8 a.m. to 4:30
p.m.
STATUTORY AUTHORITY:
KRS
224A.040,
224A.070(1),
224A.113,
224A.300