1. (a) Reimbursement procedures shall be set forth in each Financing Agreement.
2. (b) The State Water Board is authorized to reimburse any Eligible Costs incurred after the eligible construction start date or eligible work start date identified in an agreement, except as otherwise provided in a Financing Agreement. The State Water Board shall not reimburse any costs incurred prior to November 5, 2024.
3. (c) All Recipients must inform DFA of any Project-related disputes that may affect compliance with the Financing Agreement. The State Water Board will not participate in any manner to resolve bid disputes or any other dispute between a Recipient and any other party. No Recipient shall seek reimbursement for costs associated with Project-related disputes between the Recipient and another party.

4. (d) The State Water Board shall not reimburse any costs related to Construction activities before a Recipient has submitted, and DFA staff have approved, a Final Budget Approval Package. DFA staff shall approve a Final Budget Approval Package that is complete and internally consistent. Upon approval of a Final Budget Approval Package, DFA shall send the Recipient a final budget approval letter notifying the Recipient of the approval of the Final Budget Approval Package. The final budget approval letter shall also establish the final budget for the Construction activities of the Project, based on the information and documents in the Final Budget Approval Package. The final budget shall determine and direct the allocation of Grant funds within a Financing Agreement for the duration of a Project. A complete Final Budget Approval Package includes the following information and documents:

   1. (1) The Recipient's name;
   2. (2) The Financing Agreement Number and State Assigned Project Number;
   3. (3) If applicable, a description of any proposed changes to the Project's original scope and a discussion regarding whether and how that proposed change may impact the Recipient's compliance with the California Environmental Quality Act;
   4. (4) If applicable, a discussion of any material changes to the Recipient's financial condition or any other material events which have transpired since the Recipient submitted its Application, such as: new debt, recent litigation developments, recent investigations or enforcement actions, operation in a deficit, pending sale of assets, change of ownership or management, or significant controversy in the community regarding the Project;
   5. (5) If applicable, verification that the Recipient has satisfied any conditions precedent to Construction included in the Financing Agreement;

   6. (6) Information and documents related to the bidding and award of construction contracts for the Project, including:

      1. (A) The construction start date and anticipated construction completion date;
      2. (B) The California Department of Industrial Relations Project Identification Number for the Project;
      3. (C) All information on any bid protests regarding the award of the construction contract for the Project;
      4. (D) All documentation for any bid protests received, and the resolution for each;
      5. (E) A tabulation of all bids or proposals received for the Project;
      6. (F) A copy of the selected bid or proposal and purchase order issued;
      7. (G) If the apparent low bid or proposal was rejected, an explanation for the rejection;
      8. (H) A copy of all advertisements issued for bids or proposals for the Project;
      9. (I) The plans and specifications or request for proposals, as advertised, stamped by a Professional Engineer, and all addenda;
      10. (J) A schedule of values or bid items prepared for the Project, if available; and
      11. (K) A copy of the signed construction contract for the selected bid, if available.
   7. (7) A project budget table showing the Recipient's requested final budget for the Project, where one column lists each budget item, one column lists the cost of each corresponding budget item, one column lists the requested Grant funding for each corresponding budget item, and a bottom row lists the sum total cost of all budget items, and the sum total requested Grant funding for all budget items;
   8. (8) Information regarding any additional financing for the Project from any source other than Grant funds;
   9. (9) If applicable, a copy of any final or updated Waste Discharge Requirements;
   10. (10) If applicable, a copy of any value engineering study for the Project, with recommendations and responses; and
   11. (11) A certification from the Recipient's Authorized Representative that all information and documents in the Final Budget Approval Package are complete and accurate, signed by the Authorized Representative.

Note: Authority cited: Section 1058, Water Code; and Section 90135, Public Resources Code. Reference: Section 13260, Water Code; and Sections 91000, 91010 and 91014, Public Resources Code.

History

1. New section filed 2-17-2026 as an emergency; operative 2-17-2026 (Register 2026, No. 8). This filing is a deemed emergency and shall remain in effect until repealed or revised by the board pursuant to Public Resources Code section 90135(e).