Senate File 339 - Reprinted
SENATE FILE
BY COMMITTEE ON ENVIRONMENT
AND ENERGY INDEPENDENCE
(SUCCESSOR TO SSB 1234)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to wastewater treatment and providing an
2 effective date.
3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
4 SF 339
5 tm/nh/jh/26
PAG LIN
1 1 DIVISION I
1 2 WASTEWATER TREATMENT FINANCIAL ASSISTANCE PROGRAM
1 3 Section 1. Section 16.134, Code 2009, is amended to read
1 4 as follows:
1 5 16.134 WASTEWATER TREATMENT FINANCIAL ASSISTANCE PROGRAM.
1 6 1. The Iowa finance authority shall establish and
1 7 administer a wastewater treatment financial assistance
1 8 program. The purpose of the program shall be to provide
1 9 grants financial assistance to enhance water quality and to
1 10 assist communities to comply with water quality standards
1 11 adopted by the department of natural resources. The program
1 12 shall be administered in accordance with rules adopted by the
1 13 authority pursuant to chapter 17A.
1 14 2. A wastewater treatment financial assistance fund is
1 15 created under the authority of the Iowa finance authority.
1 16 The fund shall consist of appropriations made to the fund and
1 17 transfers of interest, earnings, and moneys from other funds
1 18 as provided by law. Moneys in the fund are not subject to
1 19 section 8.33. Notwithstanding section 12C.7, subsection 2,
1 20 interest or earnings on moneys in the fund shall be credited
1 21 to the fund.
1 22 3. Financial assistance under the program shall be used to
1 23 install or upgrade wastewater treatment facilities and
1 24 systems, and for engineering or technical assistance for
1 25 facility planning and design.
1 26 4. The authority shall distribute financial assistance in
1 27 the fund in accordance with the following:
1 28 0a. The goal of the program shall be to base awards on the
1 29 impact of the grant combined with other sources of financing
1 30 to ensure that sewer rates do not exceed one and one=half
1 31 percent of a community's median household income.
1 32 a. Communities shall be eligible for financial assistance
1 33 by qualifying as a disadvantaged community and seeking
1 34 financial assistance for the installation or upgrade of
1 35 wastewater treatment facilities due to regulatory activity in
2 1 response to water quality standards adopted by the department
2 2 of natural resources in calendar year 2006. For purposes of
2 3 this section, the term "disadvantaged community" means the
2 4 same as defined by the department of natural resources for the
2 5 drinking water facilities revolving loan fund established in
2 6 section 455B.295. Communities with a population of three
2 7 thousand or more do not qualify for financial assistance under
2 8 the program.
2 9 b. Priority shall be given to projects in which the
2 10 financial assistance is used to obtain financing under the
2 11 Iowa water pollution control works and drinking water
2 12 facilities financing program pursuant to section 16.131 or
2 13 other federal or state financing.
2 14 c. Priority shall also be given to projects whose
2 15 completion will provide significant improvement to water
2 16 quality in the relevant watershed.
2 17 d. Priority shall also be given to communities that employ
2 18 an alternative wastewater treatment technology pursuant to
2 19 section 455B.199C.
2 20 e. Priority shall be also given to those communities where
2 21 sewer rates are the highest as a percentage of that
2 22 community's median household income.
2 23 d. A community meeting the criteria of paragraph "a" shall
2 24 be required to provide matching moneys in accordance with the
2 25 following:
2 26 (1) Unsewered incorporated communities with a population
2 27 of less than five hundred and communities with a population of
2 28 less than five hundred shall be required to provide a five
2 29 percent match.
2 30 (2) Communities with a population of five hundred or more
2 31 but less than one thousand shall be required to provide a ten
2 32 percent match.
2 33 (3) Communities with a population of one thousand or more
2 34 but less than one thousand five hundred shall be required to
2 35 provide a twenty percent match.
3 1 (4) Communities with a population of one thousand five
3 2 hundred or more but less than two thousand shall be required
3 3 to provide a thirty percent match.
3 4 (5) Communities with a population of two thousand or more
3 5 but less than three thousand shall be required to provide a
3 6 forty percent match.
3 7 e. f. Financial assistance in the form of grants shall be
3 8 issued on a quarterly an annual basis.
3 9 g. An applicant shall not receive a grant that exceeds
3 10 five hundred thousand dollars.
3 11 5. The authority in cooperation with the department of
3 12 natural resources shall share information and resources when
3 13 determining the qualifications of a community for financial
3 14 assistance from the fund.
3 15 6. The authority may use an amount of not more than four
3 16 percent of any moneys appropriated for deposit in the fund for
3 17 administration purposes.
3 18 7. It is the intent of the general assembly that for the
3 19 fiscal period beginning July 1, 2007, and ending June 30,
3 20 2016, a minimum of four million dollars shall be appropriated
3 21 each fiscal year to the authority for deposit in the
3 22 wastewater treatment financial assistance fund.
3 23 Sec. 2. NEW SECTION. 16.135 WASTEWATER VIABILITY
3 24 ASSESSMENT.
3 25 1. The authority, in cooperation with the department of
3 26 natural resources and the department of economic development,
3 27 shall require the use of a wastewater viability assessment for
3 28 any wastewater treatment facility seeking a grant under the
3 29 wastewater treatment financial assistance program or a grant
3 30 funded by federal community development block grant moneys. A
3 31 wastewater viability assessment shall determine the long=term
3 32 operational and financial capacity of the facility and its
3 33 ratepayers. The authority shall develop minimum criteria for
3 34 eligibility based on the viability assessment.
3 35 2. The authority, in cooperation with the department of
4 1 natural resources, shall develop a wastewater viability
4 2 assessment. The assessment shall include as part of the
4 3 assessment all of the following factors:
4 4 a. The ability of the applicant to provide proper
4 5 oversight and management through a certified operator.
4 6 b. The financial ability of the users to support the
4 7 existing system, improvements to the system, and the long=term
4 8 maintenance of the system.
4 9 c. The financial position of the system including existing
4 10 debt load, rates, and reserve funds.
4 11 d. Completion of a facilities plan.
4 12 e. Completion of a management plan.
4 13 f. Completion of a financial management plan.
4 14 DIVISION II
4 15 SPONSORED PROJECTS
4 16 Sec. 3. Section 384.80, subsection 12, Code 2009, is
4 17 amended to read as follows:
4 18 12. "Project" means the acquisition, construction,
4 19 reconstruction, extending, remodeling, improving, repairing,
4 20 and equipping of all or part of a city utility, combined
4 21 utility system, city enterprise, or combined city enterprise,
4 22 or a water resource restoration project within or without the
4 23 corporate limits of the city.
4 24 Sec. 4. Section 384.80, Code 2009, is amended by adding
4 25 the following new subsection:
4 26 NEW SUBSECTION. 15. "Water resource restoration project"
4 27 means the acquisition of real property or improvements or
4 28 other activity or undertaking that will assist in improving
4 29 the quality of the water in the watershed where a city water
4 30 or wastewater utility is located.
4 31 Sec. 5. Section 384.82, subsection 1, unnumbered paragraph
4 32 1, Code 2009, is amended to read as follows:
4 33 A city may carry out projects, borrow money, and issue
4 34 revenue bonds and pledge orders to pay all or part of the cost
4 35 of projects, which may include a qualified water resource
5 1 restoration project, such revenue bonds and pledge orders to
5 2 be payable solely and only out of the net revenues of the city
5 3 utility, combined utility system, city enterprise, or combined
5 4 city enterprise involved in the project. The cost of a
5 5 project includes the construction contracts, interest upon the
5 6 revenue bonds and pledge orders during the period or estimated
5 7 period of construction and for twelve months thereafter, or
5 8 for twelve months after the acquisition date, such reserve
5 9 funds as the governing body may deem advisable in connection
5 10 with the project and the issuance of revenue bonds and pledge
5 11 orders, and the costs of engineering, architectural, technical
5 12 and legal services, preliminary reports, surveys, property
5 13 valuations, estimates, plans, specifications, notices,
5 14 acquisition of real and personal property, consequential
5 15 damages or costs, easements, rights=of=way, supervision,
5 16 inspection, testing, publications, printing and sale of bonds
5 17 and provisions for contingencies. A city may sell revenue
5 18 bonds or pledge orders at public or private sale in the manner
5 19 prescribed by chapter 75 and may deliver revenue bonds and
5 20 pledge orders to the contractors, sellers, and other persons
5 21 furnishing materials and services constituting a part of the
5 22 cost of the project in payment therefor.
5 23 Sec. 6. Section 384.84, Code 2009, is amended by adding
5 24 the following new subsection:
5 25 NEW SUBSECTION. 1A. The governing body of a city water or
5 26 wastewater utility may enter into an agreement with a
5 27 qualified entity to use proceeds from revenue bonds for a
5 28 water resource restoration project if the rate imposed is no
5 29 greater than if there was not a water resource restoration
5 30 project agreement. For purposes of this subsection,
5 31 "qualified entity" is an entity created pursuant to chapter
5 32 28E or two entities that have entered into an agreement
5 33 pursuant to chapter 28E, whose purpose is to undertake a
5 34 watershed project that has been approved for water quality
5 35 improvements in the watershed.
6 1 Sec. 7. NEW SECTION. 455B.199 WATER RESOURCE RESTORATION
6 2 SPONSOR PROGRAM.
6 3 1. The department shall establish and administer a water
6 4 resource restoration sponsor program to assist in enhancing
6 5 water quality in the state through the provision of financial
6 6 assistance to communities for a variety of impairment=based,
6 7 locally directed watershed projects.
6 8 2. For purposes of this section, unless the context
6 9 otherwise requires:
6 10 a. "Qualified entity" means the same as defined in section
6 11 384.84.
6 12 b. "Sponsor project" means a water resource restoration
6 13 project as defined in section 384.80.
6 14 3. Moneys in the water pollution control works revolving
6 15 loan fund created in section 455B.295, and the drinking water
6 16 facilities revolving loan fund created in section 455B.295,
6 17 shall be used for the water resource restoration sponsor
6 18 program. The department shall establish on an annual basis
6 19 the percentage of moneys available for the sponsor program
6 20 from the funds.
6 21 4. The interest rate on the loan under the program for
6 22 communities participating in a sponsor project shall be set at
6 23 a level that requires the community to pay not more than the
6 24 amount the community would have paid if they did not
6 25 participate in a sponsor project.
6 26 5. Not more than ninety percent of the projected interest
6 27 payments on bonds issued under section 384.84 or the total
6 28 cost of the sponsor project shall be advanced to the
6 29 community, whichever is lower.
6 30 6. A proposed sponsor project must be compatible with the
6 31 goals of the water resource restoration sponsor program, shall
6 32 include the application of best management practices for the
6 33 primary purpose of water quality protection and improvement,
6 34 and may include but not be limited to any of the following:
6 35 a. Riparian buffer acquisition, enhancement, expansion, or
7 1 restoration.
7 2 b. Conservation easements.
7 3 c. Riparian zone or wetland buffer extension or
7 4 restoration.
7 5 d. Wetland restoration in conjunction with an adjoining
7 6 high=quality water resource.
7 7 e. Stream bank stabilization and natural channel design
7 8 techniques.
7 9 f. In=stream habitat enhancements and dam removals.
7 10 7. A proposed sponsor project shall not include any of the
7 11 following:
7 12 a. Passive recreation activities and trails including bike
7 13 trails, playgrounds, soccer fields, picnic tables, and picnic
7 14 grounds.
7 15 b. Parking lots.
7 16 c. Diverse habitat creation contrary to the botanical
7 17 history of the area.
7 18 d. Planting of nonnative plant species.
7 19 e. Dredging.
7 20 f. Supplemental environmental projects required as a part
7 21 of a consent decree.
7 22 8. A sponsor project must be approved by the department
7 23 prior to participating in the water resource restoration
7 24 sponsor program.
7 25 9. A resolution by the city council must be approved and
7 26 included as part of an application for the water resource
7 27 restoration sponsor program. After approval of the project,
7 28 the city council shall enter into an agreement pursuant to
7 29 chapter 28E with the qualified entity who shall implement the
7 30 project.
7 31 10. Any conservation easements purchased with moneys
7 32 received under the program must be in perpetuity and must be
7 33 subject to use restrictions that permanently restrict the
7 34 future uses of the land.
7 35 11. The commission shall adopt rules pursuant to chapter
8 1 17A necessary for the administration of this section.
8 2 Sec. 8. Section 455B.295, subsection 2, Code 2009, is
8 3 amended to read as follows:
8 4 2. Each of the revolving loan funds shall include sums
8 5 appropriated to the revolving loan funds by the general
8 6 assembly, sums transferred by action of the governor under
8 7 section 455B.296, subsection 3, sums allocated to the state
8 8 expressly for the purposes of establishing each of the
8 9 revolving loan funds under the Clean Water Act and the Safe
8 10 Drinking Water Act, all receipts by the revolving loan funds,
8 11 and any other sums designated for deposit to the revolving
8 12 loan funds from any public or private source. All moneys
8 13 appropriated to and deposited in the revolving loan funds are
8 14 appropriated and shall be used for the sole purpose of making
8 15 loans to eligible entities to finance all or part of the cost
8 16 of projects, including sponsor projects under the water
8 17 resource restoration sponsor program established in section
8 18 455B.199. The moneys appropriated to and deposited in the
8 19 water pollution control works revolving loan fund shall not be
8 20 used to pay the nonfederal share of the cost of projects
8 21 receiving grants under the Clean Water Act. The moneys in the
8 22 revolving loan funds are not considered part of the general
8 23 fund of the state, are not subject to appropriation for any
8 24 other purpose by the general assembly, and in determining a
8 25 general fund balance shall not be included in the general fund
8 26 of the state but shall remain in the revolving loan funds to
8 27 be used for their respective purposes. The revolving loan
8 28 funds are separate dedicated funds under the administration
8 29 and control of the authority and subject to section 16.31.
8 30 Moneys on deposit in the revolving loan funds shall be
8 31 invested by the treasurer of state in cooperation with the
8 32 authority, and the income from the investments shall be
8 33 credited to and deposited in the appropriate revolving loan
8 34 funds.
8 35 DIVISION III
9 1 PERMITTING == VARIANCES == ALTERNATIVE
9 2 WASTEWATER TREATMENT TECHNOLOGIES
9 3 Sec. 9. NEW SECTION. 455B.199A PRIORITIZATION OF
9 4 MUNICIPAL WATER QUALITY IMPROVEMENT PROJECTS.
9 5 1. The department may allow schedules of compliance to be
9 6 included in permits whenever authorized by federal law or
9 7 regulations. Such schedules shall be established to maximize
9 8 benefits and minimize local financial impact, where such
9 9 opportunities arise. If information is provided showing that
9 10 the anticipated costs of compliance with a schedule have no
9 11 reasonable relationship to environmental or public health
9 12 needs or benefits, or may result in other detrimental
9 13 environmental impacts, such as significant greenhouse gas
9 14 emissions, the projects may be deferred, in whole or in part
9 15 as determined appropriate by the department, and a variance
9 16 granted, as consistent with applicable federal law or
9 17 regulations.
9 18 2. Unless otherwise restricted by federal law or
9 19 regulations, the department may allow compliance schedules of
9 20 up to thirty years in national pollutant discharge elimination
9 21 system permits, particularly where the costs of compliance
9 22 with federal program mandates will adversely impact the
9 23 construction of other necessary local capital improvement
9 24 projects. If the department determines an existing condition
9 25 constitutes a significant public health or environmental
9 26 threat, the schedule of compliance shall be based on the
9 27 shortest practicable time frame for remedying the condition.
9 28 Sec. 10. NEW SECTION. 455B.199B DISADVANTAGED
9 29 COMMUNITIES VARIANCE.
9 30 1. The department may provide for a variance of
9 31 regulations pursuant to this part when it determines that
9 32 regulations adopted pursuant to this part affect a
9 33 disadvantaged community. Such a variance shall be consistent
9 34 with federal rules and regulations. In considering an
9 35 application for a variance, the department shall consider the
10 1 substantial and widespread economic and social impact to the
10 2 ratepayers and the affected community that may occur as a
10 3 result of compliance with a federal regulation, a rule adopted
10 4 by the department, or an order of the department pursuant to
10 5 this part. In considering an application for a variance, the
10 6 department shall take into account the rules adopted pursuant
10 7 to this part with which a regulated entity and the
10 8 commensurate affected community are required to comply.
10 9 2. The department shall find that a regulated entity and
10 10 the affected community are a disadvantaged community by using
10 11 all of the following criteria:
10 12 a. Median household income in the community as a
10 13 percentage of statewide household income.
10 14 b. Annual water and sewer rates as a percentage of median
10 15 household income.
10 16 c. Families below the poverty level in the community as a
10 17 percentage of the statewide number of families below the
10 18 poverty level.
10 19 d. Per capita outstanding debt of the system as a
10 20 percentage of median household income.
10 21 e. Cost effectiveness calculated by determining
10 22 construction costs per user.
10 23 3. The department may grant a regulated entity a variance
10 24 from complying with a rule adopted pursuant to this part or as
10 25 otherwise allowed by federal law or regulations, if the
10 26 department determines that the regulated entity or the
10 27 affected community will suffer substantial and widespread
10 28 economic and social impact. The department shall ensure the
10 29 conditions of any variance represent reasonable progress
10 30 toward complying with rules adopted pursuant to this part, but
10 31 do not result in substantial and widespread economic and
10 32 social impact.
10 33 4. The Iowa finance authority, in cooperation with the
10 34 department, shall utilize the disadvantaged community criteria
10 35 in this section to determine the appropriate interest rates
11 1 for loans awarded from the revolving loan funds created in
11 2 sections 455B.291 through 455B.299, as allowed by federal law
11 3 or regulations.
11 4 5. The department of economic development shall utilize
11 5 the disadvantaged community criteria in this section to
11 6 determine eligibility for water or sewer community development
11 7 block grants as provided in section 15.108, subsection 1,
11 8 paragraph "a".
11 9 Sec. 11. NEW SECTION. 455B.199C ALTERNATIVE WASTEWATER
11 10 TREATMENT TECHNOLOGIES == LEGISLATIVE INTENT AND PURPOSE.
11 11 1. The intent of the general assembly is to address the
11 12 rising costs of water and wastewater treatment compliance for
11 13 regulated entities and affected communities by authorizing the
11 14 use of alternative treatment technologies. The purpose of
11 15 this section is to eliminate regulatory barriers that limit or
11 16 prevent the use of new or innovative technologies.
11 17 2. The department shall produce and publish design
11 18 guidance documents for alternative wastewater treatment
11 19 technologies. The guidance documents shall be intended to
11 20 encourage regulated entities to use such technologies and to
11 21 assist design engineers with the submission of projects
11 22 employing alternative wastewater treatment technologies that
11 23 can be readily approved by the department.
11 24 3. In writing design guidance documents for alternative
11 25 wastewater treatment technologies the department shall review
11 26 all of the following:
11 27 a. Curriculum materials published by the consortium of
11 28 institutes for decentralized wastewater treatment.
11 29 b. The on=site sewage design and reference manual
11 30 published by the department of natural resources.
11 31 c. The guidance manual for the management of on=site and
11 32 decentralized wastewater systems published by the United
11 33 States environmental protection agency.
11 34 d. The most recent edition of a textbook on wastewater
11 35 engineering compiled by Metcalf and Eddy, incorporated.
12 1 e. Other credible sources of information on the design,
12 2 operation, and performance of alternative wastewater treatment
12 3 technologies.
12 4 Sec. 12. Section 455B.176A, subsection 7, 8, and 9, Code
12 5 2009, are amended by striking the subsections.
12 6 DIVISION IV
12 7 SANITARY DISTRICTS
12 8 Sec. 13. Section 358.16, subsection 2, unnumbered
12 9 paragraph 1, Code 2009, is amended to read as follows:
12 10 The board of trustees may require connection to the
12 11 sanitary sewer system established, maintained, or operated by
12 12 the district from any adjacent property within the district,
12 13 and require the installation of sanitary toilets or other
12 14 sanitary sewage facilities and removal of other toilet and
12 15 other sewage facilities on the property. However, the board
12 16 of trustees shall not regulate, restrict the use, or require
12 17 the connection of a private sewage disposal facility
12 18 previously approved by the county board of health pursuant to
12 19 section 455B.172 without the prior approval of that board of
12 20 health.
12 21 Sec. 14. EFFECTIVE DATE. This division of this Act, being
12 22 deemed of immediate importance, takes effect upon enactment.
12 23 SF 339
12 24 tm/nh/jh/26