PURPOSE: This rule sets forth the eligibility, requirements and process of application for a hardship grant and direct loan program available to economically disadvantaged communities for the planning, design and construction of wastewater treatment facilities. This program is to be administered in conjunction with the existing Wastewater State Revolving Fund Program or State Direct Loan Program.

PUBLISHER’S NOTE: The publication of the full text of the material that the adopting agency has incorporated by reference in this rule would be unduly cumbersome or expensive. Therefore, the full text of the material will be made available to any interested person at both the Office of the Secretary of State and the office of the adopting agency, pursuant to section 536.031.4, RSMo. Such material will be provided at the cost established by state law.

1. (1) Grant amount will be based on the following affordability criteria: The user charge for the five thousand (5,000) gallons per month average user including total debt service, operation, maintenance and replacement, will not exceed two percent (2%) of the applicant’s median household income as published in the most recent decennial census.
2. (2) Grants may be matched with state revolving fund direct loans or state direct loans as described in 10 CSR 20-4.041 Direct Loan Program, in the amount necessary to finance the total eligible costs of the project. Hardship grants may be matched with funds from other funding agencies. The hardship grant amount shall not exceed the amount necessary to reduce user rates including debt (revenue and general obligation bonds or other debt instrument directly supporting the project) and operation, maintenance and replacement costs in line with the affordability criteria in section (1) of this rule.

3. (3) Eligible applicants are incorporated rural communities, water and sewer districts which, in November of the fiscal year the application is made for assistance, meet the following criteria:

   1. (A) Have more than a single household but no more than three thousand (3,000) inhabitants and are not within the corporate boundaries of a larger city;
   2. (B) Lack centralized wastewater treatment and/or collection systems or need improvements to on-site wastewater treatment systems;
   3. (C) The per capita income of the residents served by the project as reported by the Bureau of Census in the most recent decennial census does not exceed eighty percent (80%) of the national per capita income provided in the most recent decennial census;
   4. (D) The most recent unemployment rate as reported by the Missouri Department of Labor and Industrial Relations or, if individual project data is not available, the most recent county unemployment rate exceeds by at least one (1) percentage point the most recent monthly national unemployment rate provided by the Bureau of Labor Statistics or, in the situation where census information is not available, other sources of information regarding per capita income may be used if approved by the department;
   5. (E) Without hardship assistance, the average annual wastewater cost per household would exceed department affordability criteria as established in section (1) of this rule; and
   6. (F) The community or district is included on the Hardship Grant Fundable list on the Intended Use Plan.

4. (4) Grant Requirements.

   1. (A) All applicants must apply for a State Revolving Fund (SRF) Loan/Hardship Grant using the form provided by the department. With exception of State Fiscal Year 1998, the application must be postmarked by November 15 prior to the fiscal year for which assistance is being sought. Applications submitted during State Fiscal Year 1998 must be postmarked by the date indicated on the application form. Applications must be accompanied by a detailed engineering report discussing the scope of the project and showing total project costs and a proposed user charge system including a replacement schedule. Applications submitted without these attachments will be considered incomplete and will not be considered for funding. Costs associated with the application preparation, engineering report and user charge system may not be eligible for program participation.
   2. (B) Eligible applicants will be prioritized and placed in priority point order on a planning or fundable list in accordance with 10 CSR 20-4.010(1)(A). This list will be published in the Intended Use Plan for the fiscal year assistance is being sought.
   3. (C) The commission will select the highest rated projects for assistance from the funds anticipated to be available during the upcoming fiscal year. However, if a fundable high priority project has not submitted and obtained approval of all documents required within two (2) years of being placed on the fundable list, it will be removed and replaced with the highest priority project on the contingency list. Documents which must be submitted and approved include, but are not limited to, facility plan, engineering plans and specifications, engineering agreement, user charge ordinance, sewer use ordinance, assurance of easement acquisition, and construction permit application.
   4. (D) Applicants receiving matching SRF loan assistance of fifteen percent (15%) of the eligible project cost or more must meet the provisions and requirements of 10 CSR 20- 4.040 SRF General Assistance Regulation, and 10 CSR 20-4.041 Direct Loan Program. Fundable projects requesting SRF direct loan assistance may be placed on that fiscal year’s SRF direct loan fundable list as a special priority category project.
   5. (E) Applicants receiving matching SRF loan assistance of less than fifteen percent (15%) of the eligible project cost must meet the document submittal requirements of 10 CSR 20-4.040 SRF General Assistance Regulation, and the federal general grant regulations at 40 CFR part 31, which this rule incorporates by reference, and other rules that apply to subrecipients of federal grants and federal crosscutting authorities.
   6. (F) Applicants must have submitted a preliminary project proposal to the Missouri Water and Wastewater Review Committee (MWWRC) and received an invitation from the MWWRC to apply for financial assistance from the department.
   7. (G) Eligible projects and project requirements are those listed in 10 CSR 20- 4.041(1)–(9) Direct Loan Program, and 10 CSR 20-4.040 SRF General Assistance Regulation.
5. (5) Recipients who construct wastewater treatment facilities that require a state operating permit shall, as a condition of the grant or loan, maintain said permit over the life of the constructed works including payment of all fees associated thereto.
6. (6) If at any time during the twenty (20)-year design life of the facility(ies) funded under this rule, the facility is sold, either outright or on contract for deed, to other than a political subdivision of the state, the state shall receive reimbursement of the grant funds. The total amount of grant funds to be reimbursed shall be based on a twenty (20)-year straight-line depreciation. Grant funds to be reimbursed shall become due and payable upon transfer of ownership of the facility(ies).
7. (7) The requirements of this hardship grant rule will govern in case of any discrepancies or contradictions in definition or requirements between this rule and the related rules cited.

AUTHORITY: sections 644.026 and 644.101, RSMo Supp. 1998.* Original rule filed Nov. 3, 1997, effective July 30, 1998. Amended: Filed June 24, 1999, effective March 30, 2000.

*Original authority: 644.026, RSMo 1972, amended 1973, 1987, 1993, 1995 and 644.101, RSMo 1972, amended 1973, 1982, 1987, 1991, 1993, 1998.