33 U.S.C. § 1383 — Water pollution control revolving loan

Page 599 TITLE 33—NAVIGATION AND NAVIGABLE WATERS § 1383 (i) the cost of constructing the project or activity; (ii) the cost of operating and maintain- ing the project or activity over the life of the project or activity; and (iii) the cost of replacing the project or activity; and (14) a contract to be carried out using funds directly made available by a capitalization grant under this subchapter for program man- agement, construction management, feasi- bility studies, preliminary engineering, de- sign, engineering, surveying, mapping, or ar- chitectural related services shall be nego- tiated in the same manner as a contract for architectural and engineering services is nego- tiated under chapter 11 of title 40 or an equiva- lent State qualifications-based requirement (as determined by the Governor of the State). (June 30, 1948, ch. 758, title VI, § 602, as added Pub. L. 100–4, title II, § 212(a), Feb. 4, 1987, 101 Stat. 22; amended Pub. L. 113–121, title V, § 5002, June 10, 2014, 128 Stat. 1322.) Editorial Notes AMENDMENTS 2014—Subsec. (b)(6). Pub. L. 113–121, § 5002(1), sub- stituted ‘‘eligible under this chapter’’ for ‘‘eligible under section 1383(c)(1) of this title’’, ‘‘with assistance made available by a State water pollution control re- volving fund authorized under this subchapter, or sec- tion 1285(m) of this title, or both,’’ for ‘‘before fiscal year 1995 with funds directly made available by capital- ization grants under this subchapter and section 1285(m) of this title’’, and ‘‘sections 1371(c)(1)’’ for ‘‘sec- tions 1281(b), 1281(g)(1), 1281(g)(2), 1281(g)(3), 1281(g)(5), 1281(g)(6), 1281(n)(1), 1281(o), 1284(a)(1), 1284(a)(2), 1284(b)(1), 1284(d)(2), 1291, 1298, 1371(c)(1),’’. Subsec. (b)(9). Pub. L. 113–121, § 5002(2), substituted ‘‘standards, including standards relating to the report- ing of infrastructure assets;’’ for ‘‘standards; and’’. Subsec. (b)(11) to (14). Pub. L. 113–121, § 5002(3), (4), added pars. (11) to (14). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2014 AMENDMENT Amendment by Pub. L. 113–121 effective Oct. 1, 2014, see section 5006 of Pub. L. 113–121, set out as a note under section 1381 of this title. § 1383. Water pollution control revolving loan funds (a) Requirements for obligation of grant funds Before a State may receive a capitalization grant with funds made available under this sub- chapter and section 1285(m) of this title, the State shall first establish a water pollution con- trol revolving fund which complies with the re- quirements of this section. (b) Administration Each State water pollution control revolving fund shall be administered by an instrumen- tality of the State with such powers and limita- tions as may be required to operate such fund in accordance with the requirements and objec- tives of this chapter. (c) Projects and activities eligible for assistance The amounts of funds available to each State water pollution control revolving fund shall be used only for providing financial assistance— (1) to any municipality or intermunicipal, interstate, or State agency for construction of publicly owned treatment works (as defined in section 1292 of this title); (2) for the implementation of a management program established under section 1329 of this title; (3) for development and implementation of a conservation and management plan under sec- tion 1330 of this title; (4) for the construction, repair, or replace- ment of decentralized wastewater treatment systems that treat municipal wastewater or domestic sewage; (5) for measures to manage, reduce, treat, or recapture stormwater or subsurface drainage water; (6) to any municipality or intermunicipal, interstate, or State agency for measures to re- duce the demand for publicly owned treatment works capacity through water conservation, efficiency, or reuse; (7) for the development and implementation of watershed projects meeting the criteria set forth in section 1274 of this title; (8) to any municipality or intermunicipal, interstate, or State agency for measures to re- duce the energy consumption needs for pub- licly owned treatment works; (9) for reusing or recycling wastewater, stormwater, or subsurface drainage water; (10) for measures to increase the security of publicly owned treatment works; (11) to any qualified nonprofit entity, as de- termined by the Administrator, to provide as- sistance to owners and operators of small and medium publicly owned treatment works— (A) to plan, develop, and obtain financing for eligible projects under this subsection, including planning, design, and associated preconstruction activities; and (B) to assist such treatment works in achieving compliance with this chapter; and (12) to any qualified nonprofit entity, as de- termined by the Administrator, to provide as- sistance to an eligible individual (as defined in subsection (j))— (A) for the repair or replacement of exist- ing individual household decentralized wastewater treatment systems; or (B) in a case in which an eligible indi- vidual resides in a household that could be cost-effectively connected to an available publicly owned treatment works, for the connection of the applicable household to such treatment works. (d) Types of assistance Except as otherwise limited by State law and provided in subsection (k), a water pollution control revolving fund of a State under this sec- tion may be used only— (1) to make loans, on the condition that— (A) such loans are made at or below mar- ket interest rates, including interest free loans, at terms not to exceed the lesser of 30 years and the projected useful life (as deter- mined by the State) of the project to be fi- nanced with the proceeds of the loan; (B) annual principal and interest payments will commence not later than 1 year after Page 600 TITLE 33—NAVIGATION AND NAVIGABLE WATERS § 1383 completion of any project and all loans will be fully amortized upon the expiration of the term of the loan; (C) the recipient of a loan will establish a dedicated source of revenue for repayment of loans; (D) the fund will be credited with all pay- ments of principal and interest on all loans; and (E) for a treatment works proposed for re- pair, replacement, or expansion, and eligible for assistance under subsection (c)(1), the re- cipient of a loan shall— (i) develop and implement a fiscal sus- tainability plan that includes— (I) an inventory of critical assets that are a part of the treatment works; (II) an evaluation of the condition and performance of inventoried assets or asset groupings; (III) a certification that the recipient has evaluated and will be implementing water and energy conservation efforts as part of the plan; and (IV) a plan for maintaining, repairing, and, as necessary, replacing the treat- ment works and a plan for funding such activities; or (ii) certify that the recipient has devel- oped and implemented a plan that meets the requirements under clause (i); (2) to buy or refinance the debt obligation of municipalities and intermunicipal and inter- state agencies within the State at or below market rates, where such debt obligations were incurred after March 7, 1985; (3) to guarantee, or purchase insurance for, local obligations where such action would im- prove credit market access or reduce interest rates; (4) as a source of revenue or security for the payment of principal and interest on revenue or general obligation bonds issued by the State if the proceeds of the sale of such bonds will be deposited in the fund; (5) to provide loan guarantees for similar re- volving funds established by municipalities or intermunicipal agencies; (6) to earn interest on fund accounts; and (7) for the reasonable costs of administering the fund and conducting activities under this subchapter, except that such amounts shall not exceed 4 percent of all grant awards to such fund under this subchapter, $400,000 per year, or 1⁄5 percent per year of the current valuation of the fund, whichever amount is greatest, plus the amount of any fees collected by the State for such purpose regardless of the source. (e) Limitation to prevent double benefits If a State makes, from its water pollution re- volving fund, a loan which will finance the cost of facility planning and the preparation of plans, specifications, and estimates for construction of publicly owned treatment works, the State shall ensure that if the recipient of such loan receives a grant under section 1281(g) of this title for con- struction of such treatment works and an allow- ance under section 1281(l)(1) of this title for non- Federal funds expended for such planning and preparation, such recipient will promptly repay such loan to the extent of such allowance. (f) Consistency with planning requirements A State may provide financial assistance from its water pollution control revolving fund only with respect to a project which is consistent with plans, if any, developed under sections 1285(j), 1288, 1313(e), 1329, and 1330 of this title. (g) Priority list requirement The State may provide financial assistance from its water pollution control revolving fund only with respect to a project for construction of a treatment works described in subsection (c)(1) if such project is on the State’s priority list under section 1296 of this title. Such assist- ance may be provided regardless of the rank of such project on such list. (h) Eligibility of non-Federal share of construc- tion grant projects A State water pollution control revolving fund may provide assistance (other than under sub- section (d)(1) of this section) to a municipality or intermunicipal or interstate agency with re- spect to the non-Federal share of the costs of a treatment works project for which such munici- pality or agency is receiving assistance from the Administrator under any other authority only if such assistance is necessary to allow such project to proceed. (i) Additional subsidization (1) In general In any case in which a State provides assist- ance to an eligible recipient under subsection (d), the State may provide additional sub- sidization (including forgiveness of principal, grants, negative interest loans, other loan for- giveness, and through buying, refinancing, or restructuring debt)— (A) in assistance to a municipality or intermunicipal, interstate, or State agency to benefit a municipality that— (i) meets the affordability criteria of the State established under paragraph (2); or (ii) does not meet the affordability cri- teria of the State if the recipient— (I) seeks additional subsidization to benefit individual ratepayers in the resi- dential user rate class; (II) demonstrates to the State that such ratepayers will experience a signifi- cant hardship from the increase in rates necessary to finance the project or activ- ity for which assistance is sought; and (III) ensures, as part of an assistance agreement between the State and the re- cipient, that the additional subsidization provided under this paragraph is directed through a user charge rate system (or other appropriate method) to such rate- payers; or (B) to implement a process, material, tech- nique, or technology— (i) to address water-efficiency goals; (ii) to address energy-efficiency goals; (iii) to mitigate stormwater runoff; or (iv) to encourage sustainable project planning, design, and construction. Page 601 TITLE 33—NAVIGATION AND NAVIGABLE WATERS § 1383 (2) Affordability criteria (A) Establishment (i) In general Not later than September 30, 2015, and after providing notice and an opportunity for public comment, a State shall establish affordability criteria to assist in identi- fying municipalities that would experience a significant hardship raising the revenue necessary to finance a project or activity eligible for assistance under subsection (c)(1) if additional subsidization is not pro- vided. (ii) Contents The criteria under clause (i) shall be based on income and unemployment data, population trends, and other data deter- mined relevant by the State, including whether the project or activity is to be carried out in an economically distressed area, as described in section 3161 of title 42. (B) Existing criteria If a State has previously established, after providing notice and an opportunity for pub- lic comment, affordability criteria that meet the requirements of subparagraph (A)— (i) the State may use the criteria for the purposes of this subsection; and (ii) those criteria shall be treated as af- fordability criteria established under this paragraph. (C) Information to assist States The Administrator may publish informa- tion to assist States in establishing afford- ability criteria under subparagraph (A). (3) Limitations (A) In general A State may provide additional subsidiza- tion in a fiscal year under this subsection only if the total amount appropriated for making capitalization grants to all States under this subchapter for the fiscal year ex- ceeds $1,000,000,000. (B) Total amount of subsidization (i) In general For each fiscal year, of the amount of the capitalization grant received by the State under this subchapter, the total amount of additional subsidization made available by a State under paragraph (1)— (I) may not exceed 30 percent; and (II) to the extent that there are suffi- cient applications for assistance to com- munities described in that paragraph, may not be less than 10 percent. (ii) Exclusion A loan from the water pollution control revolving fund of a State with an interest rate equal to or greater than 0 percent shall not be considered additional sub- sidization for purposes of this subpara- graph. (C) Applicability The authority of a State to provide addi- tional subsidization under this subsection shall apply to amounts received by the State in capitalization grants under this sub- chapter for fiscal years beginning after Sep- tember 30, 2014. (D) Consideration If the State provides additional subsidiza- tion to a municipality or intermunicipal, interstate, or State agency under this sub- section that meets the criteria under para- graph (1)(A), the State shall take the cri- teria set forth in section 1382(b)(5) of this title into consideration. (j) Definition of eligible individual In subsection (c)(12), the term ‘‘eligible indi- vidual’’ means a member of a household, the members of which have a combined income (for the most recent 12-month period for which infor- mation is available) equal to not more than 50 percent of the median nonmetropolitan house- hold income for the State in which the house- hold is located, according to the most recent de- cennial census. (k) Additional use of funds A State may use an additional 2 percent of the funds annually awarded to each State under this subchapter for nonprofit organizations (as de- fined in section 1254(w) of this title) or State, re- gional, interstate, or municipal entities to pro- vide technical assistance to rural, small, and tribal publicly owned treatment works (within the meaning of section 1254(b)(8)(B) of this title) in the State. (June 30, 1948, ch. 758, title VI, § 603, as added Pub. L. 100–4, title II, § 212(a), Feb. 4, 1987, 101 Stat. 23; amended Pub. L. 113–121, title V, § 5003, June 10, 2014, 128 Stat. 1323; Pub. L. 114–322, title IV, § 5012, Dec. 16, 2016, 130 Stat. 1902; Pub. L. 115–270, title IV, § 4107(a), Oct. 23, 2018, 132 Stat. 3876; Pub. L. 117–58, div. E, title II, § 50210(a)(1), Nov. 15, 2021, 135 Stat. 1169.) Editorial Notes AMENDMENTS 2021—Subsec. (d). Pub. L. 117–58, § 50210(a)(1)(A), in- serted ‘‘and provided in subsection (k)’’ after ‘‘State law’’ in introductory provisions. Subsec. (i)(1). Pub. L. 117–58, § 50210(a)(1)(B)(i), sub- stituted ‘‘(including forgiveness of principal, grants, negative interest loans, other loan forgiveness, and through buying, refinancing, or restructuring debt)’’ for ‘‘, including forgiveness of principal and negative interest loans’’ in introductory provisions. Subsec. (i)(3)(B). Pub. L. 117–58, § 50210(a)(1)(B)(ii), added subpar. (B) and struck out former subpar. (B) which made an additional limitation on additional sub- sidization under subsec. (i). Subsec. (k). Pub. L. 117–58, § 50210(a)(1)(C), added sub- sec. (k). 2018—Subsec. (c)(12). Pub. L. 115–270, § 4107(a)(1), added par. (12). Subsec. (j). Pub. L. 115–270, § 4107(a)(2), added subsec. (j). 2016—Subsec. (i)(1). Pub. L. 114–322, § 5012(1), sub- stituted ‘‘to an eligible recipient’’ for ‘‘to a munici- pality or intermunicipal, interstate, or State agency’’ in introductory provisions. Subsec. (i)(1)(A). Pub. L. 114–322, § 5012(2), inserted ‘‘in assistance to a municipality or intermunicipal, inter- state, or State agency’’ before ‘‘to benefit’’ in introduc- tory provisions. 2014—Subsec. (c). Pub. L. 113–121, § 5003(1), added sub- sec. (c) and struck out former subsec. (c). Prior to Page 602 TITLE 33—NAVIGATION AND NAVIGABLE WATERS § 1384 amendment, text read as follows: ‘‘The amounts of funds available to each State water pollution control revolving fund shall be used only for providing finan- cial assistance (1) to any municipality, intermunicipal, interstate, or State agency for construction of publicly owned treatment works (as defined in section 1292 of this title), (2) for the implementation of a management program established under section 1329 of this title, and (3) for development and implementation of a conserva- tion and management plan under section 1330 of this title. The fund shall be established, maintained, and credited with repayments, and the fund balance shall be available in perpetuity for providing such financial assistance.’’ Subsec. (d)(1)(A). Pub. L. 113–121, § 5003(2)(A)(i), sub- stituted ‘‘the lesser of 30 years and the projected useful life (as determined by the State) of the project to be fi- nanced with the proceeds of the loan’’ for ‘‘20 years’’. Subsec. (d)(1)(B). Pub. L. 113–121, § 5003(2)(A)(ii), sub- stituted ‘‘upon the expiration of the term of the loan’’ for ‘‘not later than 20 years after project completion’’. Subsec. (d)(1)(E). Pub. L. 113–121, § 5003(2)(A)(iii)–(v), added subpar. (E). Subsec. (d)(7). Pub. L. 113–121, § 5003(2)(B), inserted ‘‘, $400,000 per year, or 1⁄5 percent per year of the cur- rent valuation of the fund, whichever amount is great- est, plus the amount of any fees collected by the State for such purpose regardless of the source’’ before period at end. Subsec. (i). Pub. L. 113–121, § 5003(3), added subsec. (i). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2014 AMENDMENT Amendment by Pub. L. 113–121 effective Oct. 1, 2014, see section 5006 of Pub. L. 113–121, set out as a note under section 1381 of this title. § 1384. Allotment of funds (a) Formula Sums authorized to be appropriated to carry out this section for each of fiscal years 1989 and 1990 shall be allotted by the Administrator in accordance with section 1285(c) of this title. (b) Reservation of funds for planning Each State shall reserve each fiscal year 1 per- cent of the sums allotted to such State under this section for such fiscal year, or $100,000, whichever amount is greater, to carry out plan- ning under sections 1285(j) and 1313(e) of this title. (c) Allotment period (1) Period of availability for grant award Sums allotted to a State under this section for a fiscal year shall be available for obliga- tion by the State during the fiscal year for which sums are authorized and during the fol- lowing fiscal year. (2) Reallotment of unobligated funds The amount of any allotment not obligated by the State by the last day of the 2-year pe- riod of availability established by paragraph (1) shall be immediately reallotted by the Ad- ministrator on the basis of the same ratio as is applicable to sums allotted under sub- chapter II of this chapter for the second fiscal year of such 2-year period. None of the funds reallotted by the Administrator shall be real- lotted to any State which has not obligated all sums allotted to such State in the first fiscal year of such 2-year period. (June 30, 1948, ch. 758, title VI, § 604, as added Pub. L. 100–4, title II, § 212(a), Feb. 4, 1987, 101 Stat. 25.) Statutory Notes and Related Subsidiaries USE OF CAPITALIZATION GRANT FUNDS FOR CONSTRUCTION GRANTS Pub. L. 101–144, title III, Nov. 9, 1989, 103 Stat. 858, as amended by Pub. L. 101–302, title II, May 25, 1990, 104 Stat. 238, provided: ‘‘That, notwithstanding any other provision of law, sums heretofore, herein or hereafter appropriated under this heading [‘‘ENVIRONMENTAL PROTECTION AGENCY’’ and ‘‘CONSTRUCTION GRANTS’’] al- lotted for title VI [33 U.S.C. 1381 et seq.] capitalization grants to American Samoa, Commonwealth of the Northern Mariana Islands, Guam, the Republic of Palau (or its successor entity), Virgin Islands and the District of Columbia, may be used for title II [33 U.S.C. 1281 et seq.] construction grants at the request of the chief ex- ecutive of each of the above named entities, and sums appropriated in fiscal year 1989 shall remain available for obligation until September 30, 1992.’’ § 1385. Corrective action (a) Notification of noncompliance If the Administrator determines that a State has not complied with its agreement with the Administrator under section 1382 of this title or any other requirement of this subchapter, the Administrator shall notify the State of such noncompliance and the necessary corrective ac- tion. (b) Withholding of payments If a State does not take corrective action within 60 days after the date a State receives no- tification of such action under subsection (a), the Administrator shall withhold additional payments to the State until the Administrator is satisfied that the State has taken the nec- essary corrective action. (c) Reallotment of withheld payments If the Administrator is not satisfied that ade- quate corrective actions have been taken by the State within 12 months after the State is noti- fied of such actions under subsection (a), the payments withheld from the State by the Ad- ministrator under subsection (b) shall be made available for reallotment in accordance with the most recent formula for allotment of funds under this subchapter. (June 30, 1948, ch. 758, title VI, § 605, as added Pub. L. 100–4, title II, § 212(a), Feb. 4, 1987, 101 Stat. 25.) § 1386. Audits, reports, and fiscal controls; in- tended use plan (a) Fiscal control and auditing procedures Each State electing to establish a water pollu- tion control revolving fund under this sub- chapter shall establish fiscal controls and ac- counting procedures sufficient to assure proper accounting during appropriate accounting peri- ods for— (1) payments received by the fund; (2) disbursements made by the fund; and (3) fund balances at the beginning and end of the accounting period. (b) Annual Federal audits The Administrator shall, at least on an annual basis, conduct or require each State to have independently conducted reviews and audits as may be deemed necessary or appropriate by the