In the review and consideration of applications for financial assistance, the Arkansas Natural Resources Commission shall give consideration to the following general and nonexclusive criteria for application approval:

1. (1) Compliance with laws.

   1. (A) The applicant and proposed project must be found to be in compliance with all applicable and relevant federal, state, and local laws and regulations (including the Arkansas Water Plan, 15 CAR pt. 29, where applicable), and the applicant must possess all necessary and incidental legal rights and privileges necessary to project commencement and operation.
   2. (B) The appropriate state agencies must have had adequate opportunity to review and comment on the proposed project;
2. (2) Eligibility. The applicant and proposed project must be determined to be eligible for the assistance sought;

3. (3) Local need, support, and priority.

   1. (A) The project must be found to be:

      1. (i) Needed in the area to be served; and
      2. (ii) Sufficient, as proposed, or reflect satisfactory progress toward serving such needs.

   2. (B) The commission shall additionally consider the project’s relative benefit and priority in relation to the needs of other proposed projects and applicants, including whether the project is:

      1. (i) Meeting known health needs; and
      2. (ii) In an economically depressed or disadvantaged area.
   3. (C) The commission shall also consider the extent and degree of local support, interest, and commitment in and to the proposed project.

   4. (D)

      1. (i) No financial assistance will be given to an applicant for use in funding a project that would constitute a duplication of services where adequate services are currently being provided unless approval for such activity has been given by the commission.
      2. (ii) As a condition of its approval, the commission may require the payment of an equitable portion of the outstanding financial assistance provided;

4. (4) Availability of or combination with other assistance.

   1. (A) The commission shall consider the feasibility and availability of alternative or additional sources of revenue that could be obtained and utilized by applicant for project financing either apart from or in conjunction with commission financial assistance.

   2. (B) In particular, with respect to the following types of projects, the following special actions must have been accomplished:

      1. (i) Municipal and industrial water supply or sewer systems.

         1. (a) (a) Applicant must have used or be prepared to use as much of the allotted ten (10) mills for municipal improvements as deemed necessary or feasible.
         2. (b) (b) This requirement is not applicable to:
5. (1) (1) Regional water districts;
6. (2) (2) Associations; or

7. (3) (3) Counties;

   1. (ii) Flood control and drainage projects. Applicant must have taxed the benefited area to the maximum practical amount to pay the local share based on comparison with other similar projects; and

      1. (iii) Engineering feasibility studies. Local interest should be adequate to ensure that the project will be constructed, providing the:

         1. (a) (a) Feasibility study points out a need; and
         2. (b) (b) Project is feasible;

8. (5) Project capacity development feasibility.

   1. (A) The commission shall consider the project’s capacity to meet financial, managerial, and technical standards.
   2. (B) The project’s technical feasibility will be addressed in the engineering data submitted.
   3. (C) New water systems must comply with the capacity development requirements of the Safe Drinking Water Act;

9. (6) Economic feasibility. The commission shall consider the apparent economic viability and feasibility of the project as a whole, including:

   1. (A) Proposed or projected costs per customer;
   2. (B) Estimated revenues from the project; and
   3. (C) The adequacy and reliability of estimated revenues necessary for project cost repayment when indicated;

10. (7) State and regional needs and public interest.

    1. (A) The commission shall give consideration to the relationship between the proposed project and the state and regional water resource development needs, as well as to whether the proposed project, if constructed, will serve the public interest and welfare.

    2. (B) In particular, such review will take into account whether a project:

       1. (i) Encourages conservation of water resources;
       2. (ii) Encompasses use of less stressed water resources;
       3. (iii) Seeks a more efficient use of existing resources; or
       4. (iv) Possesses similar features providing a benefit to the public interest in the state as a whole; and
11. (8) Availability of funds. The commission shall take into consideration the current and anticipated availability of assistance funds needed to provide the financial assistance requested.