New Jersey Discharger - Vol. 6 No. 2 Fall 1998- G

	Vol. 6 No. 2 Fall 1998
A Newsletter About New Jersey's Water Quality Programs

Rule Amendments Expand Financial Program

Now Includes Drinking Water Funding

The adopted rule amendments enable New Jersey to implement a program to finance water supply infrastructure improvement loans at one-half the market rate.

On August 3, 1998, amendments to N.J.A.C. 7:22, the rules governing the award of financial assistance for environmental infrastructure facilities, were published in the New Jersey Register. The rules previously contained the requirements for local government units to qualify for financial assistance for the construction of wastewater treatment facilities, as well as stormwater/nonpoint source management facilities. The amendments adopted by the DEP and the New Jersey Environmental Infrastructure Trust expand the scope of the rules to make financial assistance available to publicly or privately owned community drinking water supply systems, as well as to nonprofit noncommunity systems as authorized by Federal law.

The 1996 amendments to the Safe Drinking Water Act authorize states to implement Drinking Water State Revolving Funds (SRFs) similar to the existing Clean Water SRFs. In Federal Fiscal Year 1997, Congress appropriated $1.275 billion nationally to capitalize the Drinking Water SRFs, of which $28 million was allotted to New Jersey. Congress' intent is to ensure the nation's drinking water supplies remain safe and affordable, drinking water systems are properly operated and maintained, and permanent institutions are available in each State to provide financial support for future drinking water needs.

The adopted rule amendments enable New Jersey to implement a program to finance water supply infrastructure improvement loans at one-half the market rate. These systems will be able to take advantage of low-cost financing for eligible projects through the newly created New Jersey Environmental Infrastructure Financing Program, which encompasses both the Clean Water and Drinking Water SRFs.

The new Drinking Water SRF program will be similar to the existing Clean Water SRF program that funds wastewater treatment facilities and other water quality improvement projects under the federal Clean Water Act. The State's Clean Water SRF program has successfully awarded over $1.4 billion to projects since 1987.

Financing Program loans cover all allowable building costs as well as costs related to construction management activities. In addition, the loans provide funding for costs related to project administration (up to 3% of building costs), unexpected cost overruns (up to 5% of building costs), and planning and design (generally 10 - 15 % of building costs).

The new rule amendments will enable the Environmental Infrastructure Financing Program to begin funding drinking water projects in November 1998. Currently, 8 projects totaling $39.6 million are on track to be the first recipients of Drinking Water SRF funds.

For more information, please contact Theresa Fenton, Chief, Bureau of Program Development and Technical Services, at (609) 292-3859.

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Last revision Tuesday, September 08, 1998