Effective date: 7/20/1999

    (1) Only project sponsors owning community water systems, non-profit non-community water systems, and non-profit non-transient non-community water systems meeting the provisions of Florida Statutes § 403.8532(3), shall be eligible to receive financial assistance under this chapter.
    (2) The categories of allowable project costs are:
    (a) Land, including easements and rights-of-way, that will be acquired from a willing seller and is necessary for the location of the facilities to be funded. Funding of an acquisition shall be limited to the fair market value of the property necessary to locate the project facilities thereon including mandatory set-backs and buffer areas. However, the cost of acquisition shall not be included in the adjusted post-allowance project cost for the purpose of establishing allowances under Rule 62-552.420, F.A.C.;
    (b) Public water system construction and related equipment procurement and land acquisition when contracts are executed either after the effective date of a financial assistance agreement with the Department or, if an authorization to incur costs for such activities has been given by the Department, before the effective date of a financial assistance agreement with the Department. Written authorization to incur costs shall be mailed to the project sponsor within 14 days of receipt of a request for such authorization provided that the environmental review under subsection 62-552.700(3), F.A.C., has been completed. Requests for such authorization shall be made in writing and shall be submitted to the Department of Environmental Protection, Bureau of Water Facilities Funding, 2600 Blair Stone Road, MS 3505, Tallahassee, Florida 32399-2400;
    (c) Demolition and removal of existing structures;
    (d) Contingency for unforeseen project costs;
    (e) Technical services after bid opening;
    (f) Loan repayment reserve;
    (g) Interest accruing during construction on payments under binding agreements between a project sponsor and contractors, manufacturers, or suppliers;
    (h) Unretired debt principal, excluding any reserves such as for debt service, under a when refinancing loan;
    (i) Capitalized interest for the loan;
    (j) Multiple purpose facilities, such as those to treat or convey wastewater and drinking water residuals. The proportion of the total cost allowable shall be established using engineering estimates of the total cost and the least cost facilities that could resolve the public water system problem;
    (k) Allowances under Rule 62-552.420, F.A.C.;
    (l) Acquiring all or part of an existing public water system from a willing seller as part of a consolidation or regionalization project. Funding of an acquisition shall be limited to the fair market value. However, the cost of acquisition shall not be included in the adjusted post-allowance project cost for the purpose of establishing allowances under Rule 62-552.420, F.A.C.; and
    (m) Capacity purchase in an existing public water system. However, the cost of capacity purchase shall not be included in the adjusted post-allowance project cost for the purpose of establishing allowances under Rule 62-552.420, F.A.C.
    (3) Unallowable project costs include the following:
    (a) Facilities not in conformance with an approved water facilities plan;
    (b) Facilities not included within the approved project scope;
    (c) Construction using personnel employed by the project sponsor;
    (d) Costs yet to be incurred at the time of the on-site administrative action taken by the Department to document project completion, such as for pending construction claims;
    (e) Facilities or services for which the requirements of Rule 62-552.700, F.A.C., are not met;
    (f) Any project for which the post-allowance project costs are less than $75,000;
    (g) Any project sponsored by a for-profit private owner or investor-owner entity of a community water system that regularly serves 1,500 service connections or more within the certified or franchised area in which the project will be located unless such project will result in the consolidation of the project sponsor’s public water system and at least one additional public water system;
    (h) That part of any project primarily intended to serve future growth not justified by public water system service demand projections in the water facilities plan; and
    (i) That part of any project to be given financial assistance by another agency; and
    (j) Any other cost not listed as allowable under subsection (2) above.
    (4) In order to receive consideration for financial assistance, a complete grant or loan application shall be submitted to the Department of Environmental Protection, Bureau of Water Facilities Funding, 2600 Blair Stone Road, MS 3505, Tallahassee, Florida 32399-2400. The project sponsor may incorporate into a grant or loan application by reference any information previously submitted to the Department that meets the applicable requirements of this rule chapter in lieu of resubmitting such information.
    (5) The amount of the allowable project contingency shall not exceed 10% of the estimated sum of the costs for allowable land (when the actual costs are unknown), equipment contracts, materials contracts, and construction contracts prior to completion of procurement activities under subsection 62-552.700(5), F.A.C. The contingency shall be adjusted by the Department to not more than 5% of construction, equipment, and materials contract amounts after procurement contracts have been executed. The contingency remaining after accounting for contract change orders shall be eliminated by the Department at the time of the on-site administrative action taken by the Department to document project completion. Contingency funds shall not be used to pay for work not described in the financial assistance agreement.
    (6) The repayment period for loans under this rule chapter and the Act shall be limited as follows:
    (a) Construction loans shall be repaid in no more than 20 years except for loans to project sponsors qualifying as financially disadvantaged communities. The 30-year limitation established under Florida Statutes § 403.8532, shall be available only for construction loans for projects to serve financially disadvantaged communities.
    (b) Pre-construction loans shall be repaid in no more than 10 years. However, when construction loans are executed to finance the facilities planned and designed under a pre-construction loan, the project sponsor shall have the option to convert the repayment period to the repayment period negotiated for the construction loan.
    (7) Only project sponsors qualifying for funding under paragraph 62-552.200(28)(a), F.A.C., are eligible for a refinancing loan in accordance with the Act. However, a project, or any portion thereof, that is financed with a loan from the Department shall not be refinanced, at a lower interest rate, by the Department.
    (8) The lesser of 15% of the funds allocated each year by the Department or 30% of the amount determined by adding the federal grant and state matching funds and subtracting the set-asides authorized by the Act shall be used to fund projects for financially disadvantaged communities. Financial assistance may be in the form of grants or grants and loans for the non-grant funded share under subsection (6) above. However, funds available for such grants and loans are not reserved. There is no special preferential consideration given to financially disadvantaged communities in identifying projects for funding under Rule 62-552.655 or 62-552.680, F.A.C. Funds that are not committed to projects on the fundable portion of the list at the time of the annual list adoption immediately also become available for loan commitments to other than financially disadvantaged communities on a priority score basis.
    (9) The interest rate available for an additional completion loan shall be as follows:
    (a) The lesser of the interest rate established in the pre-construction loan agreement provided that the conditions under subsection 62-552.350(3), F.A.C., have been met, or
    (b) The subsidized rate based on market conditions as described in subsection 62-552.430(3), F.A.C., provided the project becomes listed on the fundable portion of the priority list under the procedures described in Rule 62-552.655 or 62-552.680, F.A.C.
    (10) Each loan and grant agreement shall have terms necessary to meet the requirements of Florida Statutes § 403.8532, the Act, and this rule chapter.
    (11) The ERC shall establish priorities and have final state approval on grant funding. Only the ERC shall place projects to be funded with grants for financially disadvantaged communities on the fundable or contingency portion of the project list under Rule 62-552.600 or subsection 62-552.680(1), F.A.C. Only the ERC shall remove projects involving grants from the list under subsection 62-552.680(4), F.A.C.
    (12) The Secretary or designee shall establish priorities and have final state approval on loan funding.
Specific Authority 403.8532 FS. Implements Florida Statutes § 403.804, 403.8532. History—New 4-7-98, Amended 8-10-98, 7-20-99.