Do you give out grants?
Yes, wastewater grants for financially disadvantaged small
municipalities authorized by Chapter 62-505, F.A.C. are available..
How much funding is available annually?
Approximately $10 million per year using current projections.
What activities will the grants fund?
Grants will fund the planning, design, and construction of
wastewater collection, transmission, treatment, disposal, and reuse
facilities. Grants will not fund stormwater facilities or fund
operation and maintenance costs.
What are the characteristics of a top priority project?
The top priority projects will involve the elimination of a
public health hazard, DEP-ordered upgrade/rehabilitation of an
existing treatment plant that is out of compliance with their
permit, or a project that eliminates excessive infiltration/inflow.
Can a grant be used to purchase existing facilities?
What are the eligibility requirements?
Municipalities will have to meet the following criteria:
- Municipalities only (no privates, counties or special
- Total population and a service area population of 7,500 or less.
- Per capita income less than $21,557.
What determines the amount of grant I get?
- The grant percentage is based on the type of project and the
municipality’s affordability index (ability to repay).
- Funding from other state or federal sources is deducted from the
total project cost prior to applying the grant percentage.
- The maximum subsidy a municipality can receive from this program
is $10 million per grant. Note that a municipality can have only one
open grant at a time.
What is an affordability index?
The affordability index is an empirical number that is
calculated using a computer model that factors in a combination of
the most recent median household income, poverty, and unemployment
census statistics by census track and is used to determine a project
sponsor’s ability to repay a loan.
How will the grant be paid?
- If the project sponsor receives a companion CWSRF loan, the
grant program provides a subsidy to the required repayments.
- If the local share component of the project is not funded
through a CWSRF loan, the grant will be disbursed to the sponsor on
a cost reimbursement basis at the grant percentage up to $500,000
per year. The sponsor is responsible for funding the non-grant share
of the project costs and for covering project costs in excess of the
What other funding options are available for utility
The Florida Department of Community Affairs, the Federal Rural
Development Agency, and the Federal Economic Development Agency are
all possible funding sources.
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What is the State Revolving Fund Program?
The Clean Water Act State Revolving Fund (SRF) Program provides
low interest loans for water pollution control activities and
facilities. Water pollution control can be divided into point source
(a permit for discharge in an urban area is generally involved) and
non-point source (stormwater runoff from agricultural operations is
generally involved). The Clean Water SRF Program is distinct from
the Safe Drinking Water Act SRF that provides funding for drinking
water activities and facilities. The Clean Water SRF Program began
in 1989 and over two billion dollars in loans have been made by the
Florida Department of Environmental Protection. The Program revolves
in perpetuity using state and federal appropriations, loan
repayments, investment earnings, and bond proceeds.
What kinds of projects are eligible?
Projects eligible for SRF loans include wastewater management
facilities, reclaimed wastewater reuse facilities, stormwater
management facilities, widely accepted pollution control practices
(sometimes called "best management practices") associated with
agricultural stormwater runoff pollution control activities, and
estuary protection activities and facilities.
Are loans limited to construction financing?
No, loans can be for the planning and engineering costs
necessary to get ready for construction. Such loans are described as
“preconstruction loans.” Preconstruction loans are available to the
sponsors of any project that will result in construction of
stormwater or wastewater management facilities. Of course, loans and
loan amendments can be made to finance construction. When a project
involves the control of agricultural runoff, a loan also may be for
the costs associated with widely accepted pollution control
practices that include technical services and the purchase of
equipment. In summary, loans can be for just about any activity
associated with water pollution control.
Who is eligible for loans?
Eligibility is established in the federal Clean Water Act. Local
governments (municipalities, counties, authorities, special
districts, and agencies thereof) are eligible for loans to control
wastewater and stormwater pollution. Non-governmental parties
(basically any entity that can repay a loan) are eligible for loans
to control stormwater pollution related to agricultural operations.
What assistance is available for small communities?
At the beginning of each year, small communities having
populations less than 20,000 are entitled to priority use of 15% of
all loan funds. In addition, small communities qualify for loans
from the unreserved 85% funds. All projects are prioritized for
funding according to a system that favors small projects regardless
of who the project sponsor is. Over the years, small communities
have accounted for 30% of all loans.
Why should I bother with the SRF?
The program has been streamlined to make it easier to get
funding and the SRF offers interest rates well below market rates.
The value of the subsidy varies with the individual borrower's
economic wellbeing, which is measured by income, unemployment, and
poverty. Generally, interest rates vary from 20% of the market rate
for a financially disadvantaged community to 80% of the market rate
for a more affluent community. Most communities (95%) have qualified
for rates below 60% of the market rate. The average is about 55% of
market rate. An example may serve to illustrate the SRF savings. A
local government with a very good AA bond rating would pay 21% more
in total interest on a 5.0%, 20-year marketplace loan as it would on
a 3.0% (60% of market rate), 20-year SRF loan! For a one million
dollar loan, that is an extra $256,400 in interest that would have
to be paid to the bondholders to get marketplace financing! For a
loan at 55% of the market rate a local government would pay 22% less
in interest and would save $286,700 in interest. The savings
available to communities that have less favorable bond ratings (or
none at all) would be greater than for the example given. In
addition to excellent rates, all loans offer fixed rate financing
for the principal amount of the loan and for the life of the loan.
What are the loan terms?
Generally, loans are to be repaid over 20 years or the useful
life of the project whichever is less. The loan repayment period can
be extended to a maximum of 30 years or useful life of the project
for projects to benefit a small community with a financial hardship.
Preconstruction loans and loans for the costs associated with
pollution control associated with agricultural runoff have shorter
loan repayment periods (generally 10 years). The interest rate is
below market. An interest rate write-down (subsidy) is available to
both governmental and non-governmental borrowers. Once established,
the rate does not change over the life of the loan. Repayment begins
six months after project work is scheduled for completion. Payback
consists of equal semiannual repayments. A dedicated revenue source
to repay the loan is required. Excess revenue, debt service reserve
and other loan security features may vary depending on the source
and predictability of the dedicated revenue.
How is the market rate determined?
The market rate for interest is established using the Thomson
Publishing Corporation's "Bond Buyer" 20-Bond GO Index. It is
established by the Department as of January 1, April 1, July 1, and
October 1 of each year and it is the average weekly yield during the
three months immediately preceding the date of determination. The
average weekly yield is derived from the yields reported in the
"Bond Buyer" for the full weeks occurring during the three-month
How is my financing rate determined?
The financing rate shall be (affordability index divided by 200)
times the market rate. The maximum financing rate shall be limited
to eighty percent of the market rate. The financing rate for a
non-governmental sponsor of a project that qualifies for funding as
a result of Section 319 or 320 of the Act shall be fifty percent of
the market rate.
What is the affordability index?
The "Affordability Index" is the empirical number that is
generated for a project sponsor using a computer model entitled
"Final Report Statistical Wt. – No Sales," which is based on a
combination of the most recent median household income, poverty, and
unemployment census statistics for local governments. The model was
developed for the program in March 2003, by the Economics Department
at Florida State University, Tallahassee, Florida. It is available
for your use and it is located in the Water Pollution Control Manual
Is there a maximum or minimum loan size?
The maximum amount of funds available to any one sponsor during
a fiscal year is 25% of the programs available funds. Normally the
maximum amount is established by a segment cap. Generally, the
segment cap is set to $15 - $20 million. When a project sponsor
qualifies for funding in excess of that available to it in any one
fiscal year the project shall be scheduled to receive funding in
subsequent fiscal years subject to the segment cap.
While there is no minimum loan amount project sponsors should
consider program requirements (like planning, design, permitting and
audit requirements) before deciding to proceed with loan funding. It
is recommended that the loan amount be a minimum of $250,000.
What are the steps in obtaining a loan?
First, project information is provided on a Request for
Inclusion Form to establish the project sponsor, a project
description, priority score, and estimated project cost. For
preconstruction loans this is the only documentation required to be
put on the Department’s project priority list. If pursuing a
construction loan, completion of a planning, design, permitting and
site certification process is needed next. The Department will then
add the project to its project priority list at a public hearing.
Once it is placed on the fundable portion of the priority list for a
preconstruction or construction loan a completed Loan Application
Form is sent to the Bureau of Water Facilities Funding. Finally, a
Loan Agreement drafted by the Department is executed by both parties
to the loan. All forms are available on the Department’s website at
What is the timeline for getting funds?
The process can be initiated upon request of a project sponsor
at any time. However, the availability of funds is the greatest at
the beginning of the State fiscal year. A hearing is held quarterly
to allocate funds. Potential SRF program participants are encouraged
to contact the Bureau of Water Facilities Funding for further
information. The hearings are normally held in January, April, July
and October on the second Wednesday of that month.
Is there a deadline to be added to the fundable list at the
The sponsor shall have postmarked or delivered to the Department
all required documentation on or before June 1 preceding the first
priority list hearing for the upcoming fiscal year. To be added to
the priority list at a subsequent hearing for that year,
documentation shall be submitted at least 30 days prior to the
hearing. All documentation must be complete as required by this
chapter 15 days prior to the hearing date. For preconstruction
projects, the Request for Inclusion form is the only documentation
required. For construction projects, the documentation required
under Rule 62-503.700, F.A.C., is also required to be submitted.
What if I’m late and don’t make the deadline?
If a sponsor is late submitting the required documentation the
project may still be added to the fundable listing provided funds are
available and the Department has the time to review and accept project
documentation. This project will not compete for funding with those
that met the deadline but will be added to the bottom of the list.
Does the SRF program fund stormwater and non-point source
Are there fees associated with the SRF?
All loans are charged a loan service fee of 2%. The fee is based
on actual project costs so you only get charged for what you
actually use. There are no other fees!
If I have questions whom can I contact or where can I go for
For more information or to arrange a meeting, please contact:
Tim Banks, P.E., Program Administrator
Wastewater Funding Section
Bureau of Water Facilities Funding
Telephone: (850) 245-8358
FAX: (850) 245-8410
Or write to:
Department of Environmental Protection, MS3505
2600 Blair Stone Road
Tallahassee, Florida 32399-2400
Or visit our website at:
Are your documents and forms available online?
Yes, they are available at: http://www.dep.state.fl.us/water/wff/wwmanual.htm
Whats the first step to get a
Submit a "Request for Inclusion on the Drinking Water Priority
List" form. This form can be downloaded from the
water manual or obtained by contacting Paul Brandl, Bureau of Water Facilities
Funding, at (850) 245-8358.
What's the availability of grant
Grant funding in any one year is limited to the lesser of $750,000
or 25% of the funds available. The total funds available for all grant projects is
approximately $3 million.
After we sign the loan agreement, do
we have to do anything else to get the money?
Yes, a disbursement request
form must be submitted. When a construction loan or grant is signed a sponsor can
immediately request the administrative and engineering allowances. Other costs are
provided on a reimbursement basis. A copy of invoiced costs (along with the disbursement
request) has to be submitted prior to payment. For a pre-construction loan or grant,
one-half of each of the administrative and the planning allowances shall be disbursed on
request of the project sponsor after a financial assistance agreement is signed. The
remaining one-half of each of the administrative and the planning allowances and one-half
of the engineering allowance shall be disbursed on request of the project sponsor after
the environmental review has been completed. The remaining one-half of the engineering
allowance shall be disbursed upon request of the project sponsor after completion of the
plans and specifications.
How long does it take to receive a
Approximately two weeks.
Will our first loan repayment be
reduced if we havent drawn all of our loan money?
amounts and dates are set by the loan agreement. The amount of the repayment will not
change until an amendment to the agreement is executed. The repayment will not go down
unless the loan amount is decreased. When the project is completed and all loan proceeds
are disbursed, a final loan repayment amount and amortization schedule will be calculated.
Who should we contact about the
status of a disbursement request if payment has not been received within the stated
You may contact the Contracts and Disbursement Section in the
Bureau of Finance and Accounting at (850) 488-6439.
Are loans and grants for
preconstruction activities available?
Yes, preconstruction loans and
grants are available. The project sponsor
must be classified as a small community water system, and for a grant, the sponsor must
also be financially disadvantaged system. The project must also have an associated
public health risk component.
If I qualify for a grant how much
money will I receive?
For preconstruction grants the sponsor will receive
85% of the available allowances based on the estimated project cost. For
construction grants the amount received is limited to 65% or 85% (based on eligibility) of
the cost to correct the public health component of the project.
How are projects prioritized?
The priority system takes into account public health
considerations, compliance with the Safe Drinking Water Act or other enforceable
requirements relating to drinking water systems, and affordability. Affordability includes
the evaluation of median household income, population affected, and consolidation of very
small public water systems which serve a population of 500 people or fewer.
Can I get grant funding to correct a
Only if it is associated with a public health problem
and only if funds are available after funding
all other sponsors project components which
have a public health risk.
When is the certification by the
State Health Officer required?
This form is only to be submitted
when the project is for the treatment of chemical or microbiological contamination for
which a maximum contaminant level has not been established. For example chemicals
such as MtBE, Bromail, or Microbiologicals such as
What can the loans be used to finance?
Construction of pollution control facilities, including those related to drinking water,
wastewater, stormwater, solid waste, and air pollution.
Is there an interest subsidy associated with the
No. The loans come from State of Florida full faith and credit revenue
bonds. Bonds are sold on a competitive bid basis and reflect market conditions. The bonds
are tax exempt.
What is the advantage to getting a loan under the
State Pollution Control Bond Loan Program?
Using the States credit rating,
interest rates may be lower than that available directly to a local government. The cost
to issue the debt is low using the bond counsel and underwriting services available to the
What is the required pledged revenue coverage?
A coverage factor 1.33 is required.
Are there any planning, design, or permitting
No, but there are construction time constraints related to the tax
exempt status of the States bonds. Basically, projects must be ready for bidding
when the loan is requested.
Are there budget and audit submittal requirements?
Yes. Both the local governments budget and audit documents must be submitted
annually until the loan is retired.
Are loan funds made available "up-front?"
No. Loan proceeds are disbursed on a cost incurred basis.
Is there a maximum or minimum loan size?
The program can provide $300 million per year. Loans less than $10 million probably would
be packaged with other loans. Loans in the million dollar range may not be practical.
Projects involving numerous small contracts, work orders, purchase orders, etc. are not
practical under this program.
How long does it take to arrange for a loan?
There are financial analysis, bond validation, and bond marketing activities that require
in excess of six months to complete.
Who does the local government contact to start the
The Bureau of Water Facilities Funding of the Department of