The DEP will hold a public hearing to solicit public comments on the Proposed Priority System, Intended Use Plan, and Project Priority List for Federal Fiscal Year 2005 (PPS-FFY2005) for New Jersey's Clean Water State Revolving Fund (CWSRF) Program. The hearing on the Proposed FFY2005 Priority System document will be held at DEP's main offices at 401 East State Street in Trenton, in the 7th floor large conference room on June 9, 2004, commencing at 10:00 a.m. and concluding at the end of testimony. Presentations may be made orally or in writing (if written testimony is prepared). The period for submitting written comments on the proposal will close June 21, 2004 (all comments must be postmarked by that date). All comments submitted by the deadline will be considered in the preparation of the final FFY2005 Priority System document.

While the Priority System ranking methodology and the majority of the funding policies are consistent with those adopted under the FFY2004 Priority System document, there are some important changes being proposed for the FFY2005 CWSRF Financing Program. The purpose of these changes is to further advance the Governor James E. McGreevey's Smart Growth Initiatives and to improve program efficiency.

The following changes have been included in the FFY2005 Priority System, Intended Use Plan and Project Priority List Proposal:

• The Smart Growth Financing Package (i.e., the "75/25" funding), whereby qualifying projects receive financing at one-quarter the market rate (rather than the traditional program's half-market rate loans), has been expanded to include three additional project categories: (1) wastewater and/or stormwater infrastructure projects to serve increased populations in Transit Villages designated as such by the inter-agency Transit Village Task Force, (2) brownfields remediation projects located in DEP-designated Brownfields Development Areas (BDAs) and (3) projects that involve the repair and/or replacement of individual septic systems through a Septic Management District. In addition, the DEP is proposing to award 10 additional points to projects in BDAs and Transit Villages so that these projects will rank higher than similar projects that are not located in smart growth areas.

• The proposal includes the second chance option to accommodate project sponsors that miss the initial application deadline of October 4, 2004. Such projects will be given a second opportunity to participate in the 2005 Financing Program. Sponsors are strongly encouraged to submit the required documentation by the October deadline, if possible. Projects that meet the October deadline will be given higher priority for long-term funding than second chance projects, and will have a better opportunity to participate in the New Jersey Environmental Infrastructure Trust's (Trust) interim financing program in the current funding cycle. Sponsors of second chance projects must submit, on or before March 7, 2005, complete planning and design documents, a loan application and proof that all applicable DEP permits/approvals have been applied for in order to be considered for the second chance option.

• The DEP is also proposing additional provisions to preserve funding for emergency repairs of existing infrastructure. These provisions will enable the Financing Program to provide preaward approval, and in some cases Trust interim financing for wastewater and stormwater infrastructure that is in need of immediate repair. Such emergency projects would not need to be listed individually on an approved Priority List for the Trust to use CWSRF monies for its interim financing program. While the DEP has progressed in this direction, federal requirements, such as Davis-Bacon wage rates and others, continue to apply to these projects. Since timing is critical, an approval process is being established for emergency repairs. Sponsors should contact the Municipal Finance and Construction Element as soon as possible during emergency situations to insure funding eligibility.

• The FFY2005 Proposal also establishes a process for updating the FFY2005 Priority List later this calendar year. The List will include projects meeting the October commitment letter/planning document submittal deadline. Thus, a comprehensive list of projects pursuing financing under the traditional schedule will be available. In addition, those projects that commit to the traditional schedule can receive interim financing from the Trust as early as January.

Beginning with the FFY2005 proposal, the DEP is no longer distributing hard copies of the Priority System document for public review. The new format will be CDs. The Priority System documents will also be posted on the DEP's web site at http://www.nj.gov/dep/dwq/cwpl.htm. In addition to the complete Priority System, Intended Use Plan and Project Priority List, the Priority System CDs include a project description and project ranking worksheet for each listed project. Copies of the CD will continue to be available at Library Information Centers (see the list in the Priority System document for these locations).

The Financing Program encourages borrowers to attend a pre-planning meeting prior to the October submission of a commitment letter and planning documents. Pre-planning meetings are an opportunity for borrowers to discuss their project with program staff. This provides applicants with a clear understanding of program requirements.

For more information on the New Jersey Environmental Infrastructure Financing Program, please contact Stanley V. Cach, P.E., P.P., Assistant Director of the Municipal Finance and Construction Element at (609) 292-8961.