PURPOSE: This rule sets forth the requirements and process of application for an industrial development grant for construction of wastewater treatment works and the terms and conditions for receipt of a grant. The rule also clarifies the requirements, the types of facilities eligible for grant funds and the grant amount available for eligible grantees.

1. (1) Program funding may be up to thirty percent (30%) of the difference between the total amount appropriated by the state legislature from water pollution control fund and the amount needed for the state match program 10 CSR 20-4.020. Small rural communities shall receive at least twenty percent (20%) of these funds as required by section 644.117, RSMo. Funds left unobligated within four (4) months of the end of the fiscal year may be reallocated to other programs.
2. (2) Grant amount is limited to fifty-five percent (55%) of the total eligible construction costs including engineering expenses during construction.
3. (3) Eligible applicants must be a first-class county, public sewer district, municipality or combination of the same.

4. (4) Grant Requirements.

   1. (A) Along with the application form the applicant must submit an engineering report compiled by a professional engineer registered in Missouri, containing a description of the problem, a cost analysis and a recommendation.
   2. (B) The applicant must provide a firm private commitment that if the applicant will provide the capacity the private concern will create or retain full-time permanent jobs.
   3. (C) Provision must be made for adequate inspection during construction by the grantee.
   4. (D) An application form must be submitted for consideration by the department. The applicant will receive a letter of intent from the department based on this initial application. If the applicant wishes to pursue funding based on the letter of intent, an application kit must be submitted containing an 10 CSR 20-4

assurance that the grantee has the legal, institutional, managerial and financial capability to insure adequate building, operation, maintenance and replacement of the treatment works throughout the applicant’s jurisdiction; a resolution designating an authorized representative; detailed plans and specifications based on the approved engineering report; a preliminary plan of operation; an assurance with respect to acquisition of real property including easements; a proposed user charge system; a proposed sewer use ordinance; and a proposed construction phase engineering agreement.

1. (E) A construction permit and an operation permit in accordance with 10 CSR 20- 6.010–10 CSR 20-6.060 must be obtained.
2. (F) The grant must not assist in the relocation of a business within the state, except in limited circumstances when relocation is within the same labor market. Exceptions may be granted by the director in consultation with the Department of Economic Development.
3. (G) Acceptance of a grant constitutes agreement that cost overrun shall be borne by applicant.
4. (H) Other funding sources must be committed prior to obligation of funds. Letters of conditions from other funding agencies will be accepted by the department as commitments. Letters of conditions will be available from the department.
5. (I) Capacity shall be limited to the industry(ies) from which the commitment was obtained. Cost of any additional capacity will be borne by the grantee.
6. (J) No grant will be awarded to an applicant who is in noncompliance with the monitoring or reporting requirements of a valid National Pollutant Discharge Elimination System permit or who is not properly operating or maintaining their existing system.

1. (5) All facilities listed in this section are eligible only if associated problems are not caused by inadequate operation and maintenance practices. Facilities to be funded are limited to publicly owned and operated—

   1. (A) New interceptors;
   2. (B) New pump stations;
   3. (C) New wastewater treatment plants;
   4. (D) Rehabilitation or upgrading of treatment plants;
   5. (E) Rehabilitation or replacement of existing pump stations, whichever is the most cost effective;
   6. (F) Replacement of force mains and interceptors causing dry weather bypassing or widespread sewer backups; and
   7. (G) On-site facilities.
2. (6) Priority will be based upon a determination by the director in cooperation with a recommendation by the Department of Economic Development concerning which industrial development project would provide the most benefit for Missouri.

3. (7) Approval and Payment of Grants.

   1. (A) The applicant shall be notified by the Department of Natural Resources when the grant is awarded.

   2. (B) Payments under the grant shall be made at the request of the applicant. Payments will be made in four (4) installments as follows:

      1. 1. A first installment when not less than

twenty-five percent (25%) of the construction of the project is completed;

1. 2. A second installment when not less

than fifty percent (50%) of the construction of the project is completed;

1. 3. A third installment when not less than

ninety percent (90%) of the construction of the project is completed; and

1. 4. A fourth installment when the project

is constructed and approved by the department.

1. (C) Payments shall at no time exceed fiftyfive percent (55%) of the eligible project cost incurred at the time payment is made.
2. (D) Any cost of work completed after the final inspection by the department shall not be considered as part of the eligible project cost.
3. (E) An audit to verify expenditure of grant funds shall be made after the final payment is made for each approved project.

AUTHORITY: sections 644.026, RSMo Supp. 1987, 644.101, 644.106, 644.111 and 644.121, RSMo Supp. 1991 and 644.116, RSMo 1986.* Original rule filed Oct. 12, 1982, effective April 15, 1983. Amended: Filed March 8, 1985, effective Oct. 1, 1985. Amended: Filed March 11, 1988, effective Oct. 1, 1988. *Original authority: 644.026, RSMo 1972, amended 1973, 1987; 644.101, 644.106 and 644.111, RSMo 1972, amended 1973, 1982, 1987, 1991; 644.116, RSMo 1972, amended 1973, 1982; and 644.121, RSMo 1972, amended 1973, 1987, 1991.