A. As used in this section, “Enhanced Nutrient Removal Certainty Program” or “ENRC Program” means the same as that term is defined in § 62.1-44.19:13.

B. The General Assembly shall fund grants to finance the reasonable costs of design and installation of nutrient removal technology at the publicly owned treatment works designated as significant dischargers contained in subsection F or as eligible nonsignificant dischargers as defined in § 10.1-2117. When grant disbursements pursuant to this section reach a sum sufficient to fund the completion of the ENRC Program at all publicly owned treatment works, the House Committee on Agriculture, Chesapeake and Natural Resources, the House Committee on Appropriations, the Senate Committee on Agriculture, Conservation and Natural Resources, and the Senate Committee on Finance and Appropriations shall review (i) the future funding needs to meet the purposes of the Water Quality Improvement Act, (ii) the most recent annual needs estimate required by § 10.1-2134.1, and (iii) the appropriate funding mechanism for such needs.

C. The disbursement of grants for the design and installation of nutrient removal technology at those publicly owned treatment works included in subsection F and eligible nonsignificant dischargers shall be made monthly based on a requisition submitted by the grant recipient in the form requested by the Department. Each requisition shall include written certification that the applicable local share of the cost of nutrient removal technology for that portion of the project covered by such requisition has been incurred or expended. Except as may otherwise be approved by the Department, disbursements shall not exceed 95 percent of the total grant amount until satisfactory completion of the project. The distribution of the grants shall be effected by one of the following methods:

1. In payments to be paid by the State Treasurer out of funds appropriated to the Water Quality Improvement Fund pursuant to § 10.1-2131;

2. Over a specified time through a contractual agreement entered into by the Treasury Board and approved by the Governor, on behalf of the Commonwealth, and the locality or public service authority undertaking the design and installation of nutrient removal technology, such payments to be paid by the State Treasurer out of funds appropriated to the Treasury Board; or

3. In payments to be paid by the State Treasurer upon request of the Director out of proceeds from bonds issued by the Virginia Public Building Authority, in consultation with the Department, pursuant to §§ 2.2-2261, 2.2-2263, and 2.2-2264, including the Commonwealth’s share of the interest costs expended by the locality or regional authority for financing such project during the period from 50 percent completion of construction to final completion of construction.

D. The General Assembly has the sole authority to determine whether disbursement shall be made pursuant to subdivision C 1, 2, or 3, or a combination thereof, provided that a disbursement shall be made pursuant to subdivision C 3 only upon a certification by the Department that project grant reimbursements for the fiscal year will exceed the available funds in the Water Quality Improvement Fund.

E. Exclusive of any deposits made pursuant to § 10.1-2128, the grants awarded pursuant to this section shall include such appropriations as provided from time to time in the appropriation act or any amendments thereto.

F. The disbursement of grants to finance the costs of design and installation of nutrient removal technology, including eligible design and installation costs for implementation of the ENRC Program, at the following listed publicly owned treatment works and other eligible nonsignificant dischargers shall be provided pursuant to the distribution methodology included in § 10.1-2131. The notation “WIP3-N” or “WIP3-P” indicates that a facility is subject to additional requirements for total nitrogen or total phosphorus, respectively, under the ENRC Program. In no case shall any publicly owned treatment works receive a grant of less than 35 percent of the costs of the design and installation of nutrient removal technology.

G. To the extent that any publicly owned treatment works receives less than the grant specified pursuant to § 10.1-2131, any year-end revenue surplus or unappropriated balances deposited in the Water Quality Improvement Fund, as required by § 10.1-2128, shall be prioritized in order to augment the funding of those projects for which grants have been prorated. Any additional reimbursements to these prorated projects shall not exceed the total reimbursement amount due pursuant to the formula established in subsection E of § 10.1-2131.

H. Notwithstanding the provisions of subsection B of § 10.1-2131, the Director shall not be required to enter into a grant agreement with a facility designated as a significant discharger or eligible nonsignificant discharger if the Director determines that the use of nutrient credits in accordance with the Chesapeake Bay Watershed Nutrient Credit Exchange Program (§ 62.1-44.19:12 et seq.) would be significantly more cost-effective than the installation of nutrient controls for the facility in question.

2007, cc. 851, 900; 2008, c. 572; 2021, Sp. Sess. I, cc. 363, 364; 2022, cc. 127, 128.