Utah Administrative Code
Topic - Environmental Quality
Title R309 - Drinking Water
Rule R309-700 - Financial Assistance: State Drinking Water State Revolving Fund (SRF) Loan Program
Section R309-700-6 - Loan, Credit Enhancement, Interest Buy-Down, and Hardship Grant Consideration Policy

Universal Citation: UT Admin Code R 309-700-6

Current through Bulletin 2024-06, March 15, 2024

(1) Board Priority Determination. To determine an applicant's priority for financial assistance, the Board shall consider the following.

(a) The applicant's ability to obtain funds for the drinking water project from other sources or to finance such project from its own resources.

(b) The applicant's ability to repay the loan or other project obligations.

(c) Whether a good faith effort has been made to secure all or part of the services needed from the private sector.

(d) Whether the drinking water project:
(i) meets a critical local or state need;

(ii) is cost effective;

(iii) will protect against present or potential hazards;

(iv) is needed to comply with the minimum standards of the Federal Safe Drinking Water Act, 42 U.S.C. Section 300(f) et. seq. or similar or successor statute;

(v) is needed to comply with the minimum standards of the Utah Safe Drinking Water Act, Title 19, Chapter 4, or similar or successor statute; or

(vi) is needed due to an Emergency.

(e) The overall financial impact of the proposed project on the citizens of the community, including direct and overlapping indebtedness, tax levies, user charges, impact or connection fees, or special assessments, resulting from the proposed project, and anticipated operation and maintenance costs versus the median income of the community.

(f) Consistency with other funding source commitments which may have been obtained for the project.

(g) The point total from an evaluation of the criteria listed in Table 1.

(h) Other criteria that the Board may consider appropriate.

TABLE 1

NEED FOR PROJECT

1. PUBLIC HEALTH AND WELFARE, SELECT ONE

POINTS

A. There is evidence that waterborne illnesses have occurred

15

B. There are reports of illnesses which may be waterborne

10

C. No reports of waterborne illness, but high potential for such exists

5

D. No reports of possible waterborne illness and low potential for such exists

0

2. WATER QUALITY RECORD, SELECT ONE

A. Primary Maximum Contaminant Level (MCL) violation more than 6 times in preceding 12 months

15

B. In the past 12 months violated a primary MCL 4 to 6 times

12

C. In the past 12 months violated a primary MCL 2 to 3 times or exceeded the Secondary Drinking Water Standards by double

9

D. In the past 12 months violated MCL 1 time

6

E. Violation of the Secondary Drinking Water Standards

5

F. Does not meet all applicable MCL goals

3

G. Meets all MCLs and MCL goals

0

3. VERIFICATION OF POTENTIAL SHORTCOMINGS, SELECT ONE

A. Has had sanitary survey within the last year

5

B. Has had sanitary survey within the last five years

3

C. Has not had sanitary survey within last five years

0

4. GENERAL CONDITIONS OF EXISTING FACILITIES, SELECT ALL APPLICABLE THAT PROJECT WILL RESOLVE

A. The necessary water treatment facilities do not exist, not functioning, functioning but do not meet the requirements of the Utah Public Drinking Water Rules (UPDWR)

10

B. Sources are not developed or protected according to UPDWR

10

C. Source capacity is not adequate to meet current demands and system occasionally goes dry or suffers from low pressures

10

D. Significant areas within distribution system have inadequate fire protection

8

E. Existing storage tanks leak excessively or are structurally flawed

5

F. Pipe leak repair rate is greater than 4 leaks per 100 connections per year

2

G. Existing facilities are generally sound and meeting existing needs

0

5. ABILITY TO MEET FUTURE DEMANDS, SELECT ONE

A. Facilities have inadequate capacity and cannot reliably meet current demands

10

B. Facilities will become inadequate within the next three years

5

C. Facilities will become inadequate within the next five to ten years

3

6. OVERALL URGENCY, SELECT ONE

A. System is generally out of water. There is no fire protection or water for flushing toilets

10

B. System delivers water which cannot be rendered safe by boiling

10

C. System delivers water which can be rendered safe by boiling

8

D. System is occasionally out of water

5

E. Situation should be corrected, but is not urgent

0

TOTAL POSSIBLE POINTS FOR NEED FOR PROJECT

100

(2) Drinking Water Board Financial Assistance Determination. The amount and type of financial assistance offered will be based on the following considerations.

(a) An evaluation based upon the criteria in Table 2 of the applicant's financial condition, the project's impact on the community, and the applicant's commitment to operating a responsible water system.

The interest rate to be charged by the Board for its financial assistance will be computed using the number of points assigned to the project from Table 2 to reduce, in a manner determined by Board resolution from time to time, the most recent Revenue Bond Index RBI as published by the Bond Buyer's Guide. The interest rate so calculated will be assigned to the financial assistance.

For hardship grant consideration, exclusive of planning and design grants or loans described in Sections 309-700-6 through R309-700-8, the estimated annual cost of drinking water service for the average residential user should exceed 1.75% of the median adjusted gross household income from the most recent available State Tax Commission records or the local median adjusted gross income (MAGI) is less than or equal to 80% of the State's median adjusted gross income. When considering funding for planning and design grants and loans described in Sections 309-700-6 through R309-700-8, the Board will consider whether or not the applicant's local MAGI meets the criteria for hardship grant funding. If, in the judgment of the Board, the State Tax Commission data is insufficient, the Board may accept other measurements of the water users' income, including a local income survey or questionnaire when there is a significant difference between the number of service connections for a system and the number of tax filings for a given zip code or city. The Board will also consider the applicant's level of contribution to the project.

TABLE 2

FINANCIAL CONSIDERATIONS

1. COST EFFECTIVENESS RATIO, SELECT ONE

POINTS

Project Cost per benefitting connection

A. $0 to $500

16

B. $501 to $1,500

14

C. $1,501 to $2,000

11

D. $2,001 to $3,000

8

E. $3,001 to $5,000

4

F. $5,001 to $10,000

1

G. Over $10,000

0

2. CURRENT LOCAL MEDIAN ADJUSTED GROSS INCOME (MAGI), SELECT ONE

A. Less than 70% of State Median AGI

19

B. 71 to 80% of State Median AGI

16

C. 81 to 95% of State Median AGI

13

D. 96 to 110% of State Median AGI

9

E. 111 to 130% of State Median AGI

6

F. 131 to 150% of State Median AGI

3

G. Greater than 150% of State Median AGI

0

3. APPLICANT'S COMMITMENT TO PROJECT

PROJECT FUNDING CONTRIBUTED BY APPLICANT, SELECT ONE

A. Greater than 25% of project funds

17

B. 15 to 25% of project funds

14

C. 10 to 15% of project funds

11

D. 5 to 10% of project funds

8

E. 2 to 5% of project funds

4

F. Less than 2% of project funds

0

4. WATER BILL, INCLUDING TAXES, AFTER PROJECT IS BUILT RELATIVE TO LOCAL MEDIAN ADJUSTED GROSS INCOME, SELECT ONE

A. Greater than 2.50% of local median MAGI

16

B. 2.01 to 2.50% of local median MAGI

12

C. 1.51 to 2.00% of local median MAGI

8

D. 1.01 to 1.50% of local median MAGI

3

E. 0 to 1.00% of local median MAGI

0

5. SPECIAL INCENTIVES, SELECT ALL THAT APPLY: The Applicant has the following:

A. A replacement fund receiving annual deposits of about 5% of the system's annual drinking water (DW) budget and fund has already accumulated a minimum of 10% of said annual DW budget in this reserve fund.

5

B. In addition to item 5.A., accumulated an amount equal to at least 20% of its annual DW budget in its replacement fund.

5

C. Created or enhanced, or will create or enhance, a regionalization plan.

16

D. Implemented a rate structure encouraging conservation.

6

TOTAL POSSIBLE POINTS FOR FINANCIAL NEED

100

(b) Optimizing return on the security account while still allowing the project to proceed.

(c) Local economic conditions.

(d) Cost effectiveness evaluation of financing alternatives.

(e) Availability of funds in the security account.

(f) Environmental need.

(g) Other criteria the Board may consider appropriate.

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