Local Government Planning Fund LGPF Drinking Water State

Local Government Planning Fund (LGPF) Drinking Water State Revolving Loan Fund (DWSRLF) Michael Vonderheide NMFA Director of Water Resources New Mexico Infrastructure Finance Conference October 24 -26, 2018 Albuquerque, NM

Local Government Planning Fund (LGPF) 2

Local Government Planning Fund » Provides up to $50, 000 in grant funds for planning related documents » Communities can qualify for two grants per 24 -month period not to exceed $100, 000 » Applications accepted monthly through En. ABLE, NMFA’s online application system 3

Eligible Entities Municipalities Counties Mutual Domestics Public Water Associations and Co-ops Irrigation Districts Indian nations, tribes or Pueblos located wholly or partially in New Mexico » Agencies or Institutions of the State » » » 4

Eligible Plans » » » » » Preliminary Engineering Reports Environmental Information Documents Asset Management Plans Water Conservation Plans Water Master Plans Economic Development Plans (LEDA) Metropolitan Redevelopment Act Plans Comprehensive Plans Economic Development Feasibility Studies 5

Terms and Rates 0% - 100% grant funds, the remainder is match. Tests to determine amount of Grant: -- Cash Test -Review financials for no more than ½ total expenditures in available cash Medium Household Income Test MHI of Entity / MHI of the State Local Burden Ratio Test Local water rate / State average water rate (based on 6, 000 gallons) 6

Terms and Rates, cont. Job Availability Test Entity Employment / State Employment Wage Sufficiency Test Entity Median Earnings / State Median Earnings 7

Local Match Waivers: » » Urgent Needs Projects cure regulatory compliance issues cited by NMED Public Health Threats waterborne disease outbreak & inadequate water supply [existing or imminent solved by project] » » Acute road hazards brought on by catastrophic events or severe weather Flood & drainage issues resulting from inadequate or poorly designed infrastructure causing health & safety issues Dam Safety projects that restore to a safe condition impending failures in dam structures. Projects that cure conditions brought on by unforeseeable calamity, including: flood, fire, storm, earthquake, drought, civil disturbance, accidental spill of a hazardous material or similar occurrence, disrupts the provision of utility services or endangers the provision of public utility services Declining Economic Development » » » Planning documents that enact or update Local Econ Dev Act ordinances Planning documents that enact or update Metro Redevelopment plans Qualified entities that qualify for Small Cities Assistance Fund or Small Counties Assistance Fund experienced decline of GRT over past 24 months Qualified entities that don't qualify for Small Cities Assistance Fund or Small Counties Assistance Fund experienced decline of GRT over past 36 mons Qualified entities experienced loss of major employer in past 12 months Qualified entities without GRT authority that serve fewer than 250 connections 8

Tips for Success » Have someone dedicated to monitoring the project, and who will communicate with NMFA through the LGPF@nmfa. net e-mail address » Have the contractor lined up before you apply for the grant, or if you cannot do that, then RFP as soon as you receive the award letter from NMFA » Be aware of the deadlines in the award letter: ˃ Within 5 months you must have a signed contract. This is crucial, otherwise the project will be off track from the get-go! ˃ Within 12 months you must submit the planning document to the reviewing agency ˃ Within 16 months you must have final approval of the planning document (it can take up to 2 months to close) ˃ Within 18 months the grant must be closed and funded » Communication with NMFA is key! 9

Application » Applications accepted monthly through the En. ABLE online application system » Send all questions to Local Government Planning Fund e-mail: LGPF@nmfa. net NMFA Contacts: ˃ Susan Rodriguez, Water Resources Administrator srodriguez@nmfa. net ˃ Mary Finney, Water Resources Administrator mfinney@nmfa. net 10

Drinking water state revolving loan fund (DWSRLF) 11

Drinking Water State Revolving Loan Fund Ø DWSRLF offers low-cost financial assistance to water systems to: Finance repair and replacement of drinking water infrastructure Ensure compliance with drinking water regulations Protect drinking water quality and public health Ø DWSRLF is jointly administered by New Mexico Finance Authority (NMFA) and New Mexico Environment Department - Drinking Water Bureau (NMED-DWB). 12

Federal Funding Source Ø DWSRLF is federally funded through U. S. EPA, which has important implications. DWSRLF is subject to: Ø Availability of federal funds Ø Federal priorities (e. g. subsidy) Ø Federal requirements, such as: National Environmental Policy Act American Iron and Steel Davis-Bacon Wage Act Disadvantaged Business Enterprise Federal Single Audit 13

DWSRLF Advantages Ø Broad eligibility Ø Low interest rates (0%-2%) Ø 25%-75% subsidy (subject to availability) Ø Funding requests accepted year-round Ø Assistance provided to unsuccessful applicants to enable them to qualify Ø High level of customer service 14

Eligible Systems Ø Public Water Systems (PWS) that are privately or publicly owned community water systems, or a non-profit non-community PWS Examples of Eligible Projects Ø Ø Ø New and replacement sources Treatment Transmission/Distribution Storage Meters Infrastructure to regionalize water systems 15

Disadvantaged Systems Ø Disadvantaged systems qualify for special funding terms. Ø Disadvantaged system: 1. Community Median Household Income (MHI) ≤ 90% of State MHI, and 2. 0. 01 < Affordability ratio* < 0. 015 Ø Severely Disadvantaged system: 1. Community MHI ≤ 90% of State MHI, and 2. Affordability ratio* > 0. 015 * Affordability ratio = Average Annual User Charges/MHI 16

Interest Rates and Loan Terms Ø Interest rates: Ø Loan repayment period is up to 20 years, following a 2 -year construction period Ø Severely Disadvantaged systems may qualify for loan repayment period of up to 30 years. 17

Subsidy Ø Subsidy is determined annually. It may be fully allocated before the end of the fiscal year. Ø Current subsidy: § All construction projects – 25% subsidy § Disadvantaged systems – Additional 25% subsidy § Severely Disadvantaged systems – Additional 25% subsidy § Maximum subsidy – 75% 18

Priority List Ø DWB develops and publishes Comprehensive and Fundable Priority Lists. Ø All systems that submit a Project Interest Form and required supplemental documents to DWB are included on the Comprehensive Priority List. Ø Systems that meet the following criteria are included on the Fundable Priority List: 1. Adequate Managerial and Technical Capacity as determined by DWB 2. Project is ready-to-proceed within 6 months 3. Financial ability of system to repay the loan 19

Priority List, cont. Ø Eligible projects are ranked on the Priority Lists according to DWSRLF Project Ranking Criteria, which includes these 6 categories: § Source Water Vulnerability § Safe Drinking Water Act Compliance § Affordability § Regionalization § Water Efficiency § Sustainability Ø Funding is allocated to projects on the Fundable Priority List in the order they are ranked. 20

Intended Use Plan Ø NMFA/DWB create an annual DWSRLF Intended Use Plan (IUP), which outlines how we plan to use federal funds for the coming fiscal year. It includes: �Loan interest rates, loan terms, and subsidy �Priority ranking criteria �Annual Fundable Priority List Ø IUP is subject to public review and comment before it is finalized and approved by EPA. Ø Current IUP for SFY 2019 is available on NMFA and DWB websites. 21

NMFA Contacts Send all questions to: Drinking Water State Revolving Loan Fund e-mail DW@nmfa. net Todd Johansen, Senior Program Administrator tjohansen@nmfa. net or (505) 992 -9654 22

Thank You 23