PURPOSE: This rule sets forth the requirements and process of application for storm water loans and grants for construction of storm water control facilities and the terms and conditions for receipt of the loan and/or grant as revised. This rule also clarifies the requirements, the types of facilities eligible for funds and the calculation used to determine the amount of loan and grant available for eligible grantees.

1. (1) Applicability. This rule defines the minimum requirements which apply to all recipients of assistance under the state storm water grant and loan program. The recipient must satisfy more stringent requirements if required to do so by the state constitution, state or local statutes, policies, rules, ordinances, or orders.

2. (2) Definitions.

   1. (A) Commission. The Missouri Clean Water Commission.
   2. (B) Delegated entity. An eligible applicant that has been designated by the department as having sufficient staff and expertise to administer funds to subrecipients within its jurisdiction.
   3. (C) Department. The Missouri Department of Natural Resources.

   4. (D) Eligible Applicant.

      1. 1. Any first class county not served by

Metropolitan St. Louis Sewer District (MSD); or

1. 2. The MSD; or
2. 3. Any entitlement city.
3. (E) Eligible Recipient. Any municipality, county, public sewer district, or public water district within the boundaries of the eligible applicant can receive funding if selected by the eligible applicant’s Storm Water Coordinating Committee.
4. (F) Entitlement City. A municipality located in whole or in part in a first class county with a population of at least twenty-five thousand (25,000) based on the most recent decennial census unless that city is within a sewer district established pursuant to Article VI, Section 30(a) of the Missouri Constitution.
5. (G) Force Account. Project planning, design, construction or engineering inspection work performed by the recipient’s regular employees and rented or leased equipment.
6. (H) Letter of Commitment. Initial offer from the department to the eligible storm water funding recipients which details the amount allocated to the recipient and specifies the dates applicable to the receipt of the funds.
7. (I) Storm Water Coordinating Committee (SCC). A local committee or group established by eligible applicants involved in project screening and project selection. In cities over twenty-five thousand (25,000) population, the SCC shall consist of a committee or organizational unit designated by the city. In St. Louis City and County, the SCC shall consist of a committee or organizational unit designated by the executive director of the Metropolitan St. Louis Sewer District. In all eligible counties, except St. Louis County, an SCC must be established which is representative of the county government and incorporated municipalities within the county.
8. (J) Storm Water Repayment Fund. Fund containing repayments and interest from storm water loans originated from storm water control bonds.

1. (3) General Requirements.

   1. (A) Jurisdictional Requirements. Storm water funds may be used for storm water projects in any first class county, or city not within a county, or as specified in Article III, Section 37(h) of the Missouri Constitution.

   2. (B) Allocation of Bond Fund Proceeds. The department will determine the amount of funds to be allocated to the eligible recipients after Stormwater Control Bonds are issued and are deposited into the Stormwater Control Fund. The funds will be allocated to each first class county and to each sewer district established pursuant to Article VI, Section 30(a) of the Missouri Constitution by a percentage based on the population of the qualifying county or sewer district in relation to the total population of all eligible counties and sewer districts. The most recent federal decennial census will be used for all population statistics.

      1. 1. The funds will be further allocated to

each entitlement city by a percentage based on the population of the entitlement city in relation to the total population of the first class county(ies) in which the entitlement city is located.

1. 2. The department will send a letter of

commitment to each eligible applicant. The notification will include the county, city, or sewer district’s proportionate share of the balance in the Stormwater Control Fund and instructions for applying for the funds.

1. (C) Reallocation of Unused Bond Fund Proceeds. Within sixty (60) days of the date specified in the letter of commitment as the final day for receipt of applications, the department will determine if there are any remaining unused bond fund proceeds. When calculating this amount, the department will 10 CSR 20-4

include interest that has accrued to the Stormwater Control Fund that was not included in the original calculation and any funds that have not been applied for through the original letter of commitment. The total of these funds will be allocated as described in subsection (3)(B) of this rule except that the calculation will exclude any eligible applicant that has not responded to the initial letter of commitment by the application date.

1. (D) Planning Requirements.

   1. 1. All storm water projects must be con-

sistent with a comprehensive storm water management plan. A storm water management plan should contain at a minimum the following components:

1. A. An introduction that defines terms

and discusses the purpose, scope, hydrology, and alternatives considered;

1. B. A discussion of the data and

methodology used in plan development;

1. C. A description of the existing sys-

tem (if applicable);

1. D. A list of proposed storm water

projects;

1. E. A description of the methodology

used to evaluate and establish project priority ranking;

1. F. Estimates of cost for full imple-

mentation of the plan;

1. G. A description of the maintenance

plan for existing and new systems;

1. H. A geomorphological assessment of

the plan area;

1. I. A description of the rainfall/runoff

modeling data for the plan area;

1. J. Modeling data, structure data and

photographs, public survey response forms; and

1. K. Watershed map, public response

map, flood plain map, maps showing project areas.

1. 2. The project specific drainage basin

plan must be submitted in conjunction with the applicant’s storm water application to the department. The geographical extent of the planning area may be determined by the department or the delegated entity. Projects which are solely for bank stabilization or erosion control, or other projects as determined by the department or the delegated entity, need only provide the items listed in subparagraphs (3)(D)2.B., D., and E. The drainage basin plan should include, but is not limited to:

1. A. A detailed map of the project

drainage area showing computed drainage acreage;

1. B. A narrative, a plan layout, and esti-

mated construction costs for the proposed project;

1. C. Tabulated storm water conceptual

design parameters for the drainage area, that is, upstream acres, runoff coefficients, time of concentration, return frequencies, and so forth. Computer modeling information may be submitted;

1. D. A determination of the flood ele-

vation changes resulting from the project, unless the Corps of Engineers has committed to remap the area; and

1. E. An evaluation of limited structural

approaches to storm water control. The plan must analyze the use of applied geomorphology and bioengineering techniques to manage storm water. Combinations of measures can be employed to manage storm water and retain important stream functions. “Bioengineering” combines mechanical, biological, and ecological concepts to prevent slope failures and erosion. Bioengineering techniques may use bare root stock, stems, branches, or trunks of living plants on eroded slopes. Plantings may be incorporated into such configurations as a live stakings, live fascines, or living cribwall. Vegetative plantings and cuttings may be combined with structural elements such as gabion baskets or rock surface armoring. However, the intent should be to minimize hard structural solutions and allow the rooted plantings to do much of the work to hold the soil in place and retain the natural function of streams to convey storm water. Other storm water management options include environmental easements and land acquisition. Projects that are only rehabilitation or replacement of existing structures will require an evaluation that addresses reasonable geomorphological alternatives and, if this approach is not taken, a brief discussion why not. For more complex projects, the evaluation should address the root causes of flooding, bed and bank erosion, and sediment deposition. The plan should not exacerbate these problems by:

1. (I) Modifications to stream systems

that increase bed and bank erosion in modified stream sections;

1. (II) Cause these impacts in sections

that are upstream or downstream of the storm management project;

1. (III) Remove or degrade aquatic

habitat;

1. (IV) Remove the pollutant removal

benefits of vegetated stream corridors; or

1. (V) Lead to increased flooding

upstream or downstream of the storm water management project.

1. (4) Required Documents. Prior to grant award and/or loan closing, the applicant must submit a completed storm water grant/loan application to the department. The following documents must be submitted and approved by the department or delegated entity prior to construction advertising. Some documents may be waived by the department or delegated entity on a case-by-case basis if it is determined they are not needed for that project:

   1. (A) The following documents are required for a project which includes design and construction:

      1. 1. Construction plans, specifications,

and design criteria;

1. 2. Certification by the recipient that—

   1. A. The facilities, when completed,

will be owned, operated, and maintained by a political subdivision eligible under subsection (3)(A) of this rule; or

1. B. Evidence of a permanent easement

and legal authority to ensure operation and maintenance of the facility;

1. 3. Certification by the recipient that con-

tract documents and construction bidding will conform to relevant local and state laws;

1. 4. Certification by the recipient that all

necessary easements and land have been or will be obtained prior to construction start; and

1. 5. Certification by the recipient that the

recipient will construct the project or cause it to be constructed to final completion in accordance with the certified plans and specifications; and

1. (B) The following documents must be submitted for all storm water grant/loan projects including grants/loans for planning:

   1. 1. Certification by the recipient that all

state storm water funds will be expended solely for carrying out the approved project;

1. 2. Certification by the recipient that a

registered professional engineer has been selected and will perform the services required in section (9) of this rule;

1. 3. Certification by the recipient that the

local match is available; and

1. 4. Certification by the recipient that any

required section 404 dredge and fill permits from the United States Army Corps of Engineers or land disturbance permits from the department will be obtained prior to construction.

1. (5) Eligible Project Costs. The information in this section represents policies and procedures for determining the eligibility of project costs for assistance under the Storm Water Grant and Loan Program.

   1. (A) General. It is the policy of the commission that all project costs will be eligible if they meet the following tests:

      1. 1. Reasonable and cost effective;
      2. 2. Necessary for the construction of an

operable storm water facility or for the completion of a comprehensive storm water master plan; and

1. 3. Included in the scope of the project as

described in the application and engineering submittals.

1. (B) Eligible Costs. Eligible costs include at a minimum:

   1. 1. Costs for development of a compre-

hensive storm water control plan meeting the requirements of subsection (3)(D);

1. 2. Engineering services for planning and

design based on invoiced amounts for a contracted engineering consultant. A copy of the approved engineering agreement must be submitted to the department or delegated entity when engineering services are to be reimbursed with grant or loan funds. The contract should be a lump sum or cost plus fixed fee contract in the form of a bilaterally executed written agreement.

1. 3. Costs for construction-related engi-

neering when invoiced per an acceptable two (2)-party engineering agreement;

1. 4. Construction costs including con-

struction permits as issued by DNR;

1. 5. Land purchase or permanent ease-

ment costs required for storm water holding basins, grass-lined channels or for other limited structural storm water control projects, or buy-outs if the land purchased is restricted such that no permanent structure except for structures allowed under the Missouri Statewide Comprehensive Outdoor Recreation Plan (SCORP) may be constructed within the easement or purchase area. Construction costs related to holding basins on private land are eligible if the eligible recipient retains a permanent easement, is legally responsible for operation and maintenance of the facility, and the basin constructed is clearly for storm water control and not recreational use;

1. 6. Costs of force account work for plan-

ning, design, construction, construction engineering, and costs of rented or leased equipment. It does not include the costs of recipient-owned equipment or the costs of administration for grants and loans. Engineering performed by force account must meet the requirements of 10 CSR 20-4.061(9) which state that storm water plan preparation, design, and inspection must be provided by a registered professional engineer or by a person under the direct and continuing supervision of a registered professional engineer. To be considered for force account, the following information must be submitted for review and approval by the department prior to beginning on the project:

1. A. Which project(s) they intend to do

with city employees;

1. B. The names of the employees who

will be working on the project;

1. C. A specific time code must be

assigned to each project. The letter should state the time code number;

1. D. For engineering work, the letter

must contain an assurance that the employee is a registered professional engineer or the name of the professional engineer who directly supervises this person;

1. E. The hourly wage for each individ-

ual must be given. If the person is salaried, this is the total annual salary divided by two thousand and eighty (2,080) hours. The hourly wage cannot include fringe or indirect costs; and

1. F. A copy of the time card that will be

used. The time card must list the employee name, project time code, hours worked, and the signature of the employee and the supervisor. Should there be a change in employees, salary, or engineering supervisor during the course of the project, the recipient must amend/update the information in the original letter before that salary and/or employee cost can be reimbursed;

1. 7. Demolition costs of structures located

within storm water control areas provided future development of permanent structures in the storm water control area is restricted;

1. 8. Local cost of issuance and capitalized

interest incurred on loans administered under this rule;

1. 9. Up to five (5) sequential years of

grant and/or loan funding may be used for the same project if it meets the following criteria:

1. A. The contract is awarded within the

time frame necessary to receive the first grant and/or loan of the sequence;

1. B. The recipient certifies that there

are adequate funds committed from other sources to complete the construction;

1. C. The recipient commits to the orig-

inal funding combination for the entire sequence of grants and/or loans; and

1. D. The recipient certifies that the pro-

ject will be completed with or without the subsequent years’ grant/loan funds.

1. 10. Costs associated with minimizing

storm water damage to sink holes;

1. 11. The reasonable costs of administra-

tive fees incurred by a delegated entity in connection with each grant; and

1. 12. One hundred percent (100%) of the

reasonable costs of a grant anticipation loan will be eligible. Departmental approval must be obtained prior to securing the grant anticipation loan. Grant anticipation loan costs will be approved when the loan is needed for cash flow purposes for the period between the receipt of the letter of commitment and the first receipt of funds by the grantee. The approved costs of a grant anticipation loan will not increase the approved grant amount. (6) Ineligible Project Costs. Ineligible costs include, but are not limited to, the following:

1. (A) Projects which divert storm water to sinkholes or which modify sinkholes to increase storm water capacity;
2. (B) Local government administration or legal costs, including appraisals;
3. (C) Land purchase or easement costs other than those listed in paragraph (5)(B)5.;
4. (D) Permits required for the ongoing operation of the constructed facility(ies);
5. (E) Construction costs incurred prior to the letter of commitment; and
6. (F) Ordinary upkeep and maintenance of existing facilities.

1. (7) Grant Amount. The maximum grant is limited to fifty percent (50%) of the total eligible project costs or available funds, whichever is less. The recipient must provide the remaining amount needed to complete the project through a storm water loan administered by the DNR or other acceptable source of funds. Grants may be matched with other state or federal grants up to one hundred percent (100%) of the eligible project costs.
2. (8) Loan Amount. Loans will be available in an amount up to one hundred percent (100%) of eligible project costs. Loans may be matched with state or federal grants. However, in no case will the total government assistance exceed one hundred percent (100%) of eligible project costs.

3. (9) Engineering Requirements.

   1. (A) A registered professional engineer must prepare the project specific drainage basin plan and design all construction plans and specifications for competitive bidding and compliance with generally accepted storm water design criteria. The documents must have the professional engineer’s seal when they are submitted to the department or delegated entity.
   2. (B) A registered professional engineer or a person under the direction and continuing supervision of a registered professional engineer must provide inspection of construction for the purpose of assuring compliance with the approved plans and specifications.

4. (10) Bidding Requirements.

   1. (A) This subsection applies to procurement of construction equipment, supplies, and construction services in excess of one hundred thousand dollars ($100,000) awarded by the recipient for any storm water project.

      1. 1. Each contract shall be awarded after

formal advertising. The project advertisement must be published in a newspaper at least one (1) time thirty (30) days prior to the bid open- 10 CSR 20-4

ing or five (5) consecutive days two (2) weeks prior to bid opening or in accordance with the local government’s procurement ordinances.

1. 2. Contract award shall be to the lowest

responsive and responsible bidder.

1. 3. Departmental concurrence or concur-

rence from the delegated entity with contract award must be obtained prior to the actual contract award if fewer than three (3) bidders submit bids or if the recipient wishes to award the contract to other than the low bidder. The recipient shall forward the tabulation of bids and a recommendation of contract award to the department or delegated entity for review.

1. 4. Executed contract documents must be

submitted prior to the first grant payment if payments are made monthly. If the grant is paid into an escrow account, the executed contract documents must be submitted with the first statement that indicates construction costs were paid with grant funds.

1. (B) Small Purchase Contract. A small purchase is the procurement of materials, supplies, and services when the aggregate amount involved in any one (1) transaction does not exceed one hundred thousand dollars ($100,000). The small purchase limitation of one hundred thousand dollars ($100,000) applies to the aggregate total of an order, including all estimated handling and freight charges, overhead, and profit to be paid under the order. In arriving at the aggregate amount involved in any one (1) transaction, all items which should properly be grouped together must be included. A minimum of three (3) quotes must be obtained and approved by the department or delegated entity.

1. (11) Grant Payments.

   1. (A) For Storm Water Grants and Storm Water Grant Amendments Made during the Period March 4, 2007 through August 30, 2007. For grants that are not matched with loans from this program, full payment will be made at the time of the department’s receipt of the executed grant award or grant amendment. The following provisions shall apply:

      1. 1. Except for a delegated entity, the

grantee shall establish a separate escrow account with a bank as defined in Chapter 409, section 409-1.102, RSMo. The requirement to establish an escrow account may be waived for projects that are expected to be complete within three (3) months of grant award;

1. 2. The full grant amount, less any pay-

ments processed prior to the date of this rule, will be paid into the grantee’s established escrow account or to the grantee directly if the escrow account requirement has been waived;

1. 3. Grant funds paid to the escrow

account or to the grantee may be used to pay up to fifty percent (50%) of the costs of section (5) of the rule. No funds may be withdrawn from the escrow account until the following conditions have been met:

1. A. Projects involving construction

and not paid through a delegated entity must submit to the department:

1. (I) Construction plans and specifi-

cations, design criteria, and drainage basin plan prepared in accordance with subsection (3)(D) of this rule; and

1. (II) Executed contract documents;
2. B. All construction contracts must be

awarded by December 31, 2007. For grants not paid through a delegated entity, it is the grantee’s responsibility to submit the construction documents to the department no later than January 31, 2008. Failure to award the major construction contracts by December 31, 2007, will result in departmental recovery of the full grant amount;

1. C. For grants for planning projects,

the grantee must have all grant funds fully committed to the project by July 1, 2008; and

1. D. Any funds remaining in an escrow

account established under this subsection on January 1, 2010, will be recovered by the department;

1. 4. The grantee shall submit the bank

statement of the escrow account monthly within thirty (30) days of the end of the month. If the monthly statement indicates that funds were withdrawn, the grantee shall submit copies of the invoices to document the costs. For grantees that have received grant funds when the escrow requirement has been waived, documentation shall be submitted within one hundred twenty (120) days of grant payment; and

1. 5. Projects administered through a dele-

gated entity will be paid in accordance with that entity’s procedure on file with the department.

1. (B) Storm Water Grants and Loans Made after August 30, 2007. Based on the cash flow circumstances of the storm water bond fund, the department may elect to pay out the full grant amount at the time of grant award or to make multiple reimbursement payments to the grantee.

   1. 1. If the department elects to make full

payment of the grant amount, the payment shall be made at the time of the department’s receipt of the executed grant award. The following provisions apply:

1. A. Except for a delegated entity, the

grantee shall establish a separate account dedicated to the storm water grant funds;

1. B. The grant amount must be deposit-

ed to the dedicated account;

1. C. Grant funds may be used to pay up

to fifty percent (50%) of the eligible costs listed in section (5) of this rule. No funds may be withdrawn from the escrow account until the following conditions have been met:

1. (I) For construction projects not

paid through a delegated entity, the grantee must submit and receive departmental concurrence for:

1. (a) Construction plans and spec-

ifications prepared in accordance with subsection (3)(D) of this rule; and

1. (b) Executed contract docu-

ments; and

1. (II) For planning projects not paid

through a delegated entity, the grantee must have the department’s approval for all major consulting contracts, and a copy of the consulting contracts must be on file with the department;

1. D. The bank account may earn inter-

est; however, all withdrawals from the account must be documented with eligible invoices. If the project costs are inadequate to withdraw all the funds in the account, the balance must be refunded;

1. E. Any funds remaining in an escrow

account established under this subsection three (3) years after the initial payment will be recovered by the department; and

1. F. The grantee shall submit the bank

statement of the escrow account monthly within thirty (30) days of the end of the month. If the monthly statement indicates that funds were withdrawn, the grantee shall submit copies of the invoices to document the costs.

1. 2. If the department elects to make mul-

tiple grant payments rather than fund the grantee’s escrow account, payments can be requested no more frequently than monthly. The department will provide a payment form for the grantee to use. The payment request must be supported by invoices to document the costs incurred. Grant funds may be used to pay up to fifty percent (50%) of the eligible costs listed in section (5) of this rule. No funds will be released to the grantee until the following conditions have been met:

1. A. For construction projects not paid

through a delegated entity, the grantee must submit and receive departmental concurrence for:

1. (I) Construction plans and specifi-

cations prepared in accordance with subsection (3)(E) of this rule; and

1. (II) Executed contract documents;
2. B. For planning projects not paid

through a delegated entity, the grantee must have the department’s approval for all major consulting contracts, and a copy of the consulting contracts must be on file with the department; and

1. C. Any funds remaining in the grant

three (3) years after the date of the grant award will be recovered by the department.

1. 3. Projects administered through a dele-

gated entity will be paid in accordance with the delegated entity’s procedure on file with the department.

1. (C) An audit to verify eligible project costs will be made by the department after the completion and inspection of the project. Any funds found not expended for purposes listed in section (5) of this rule will be recovered in addition to any applicable penalties.

1. (12) Loan Requirements.

   1. (A) Loans shall be administered in accordance with the provisions in 10 CSR 20- 4.041 or 10 CSR 20-4.042 except that the loan shall not be subject to requirements unique to wastewater treatment projects. When the storm water loan is funded through storm water control bonds, the loan shall not be subject to requirements specific to federal funding.
   2. (B) Loans must be secured with an acceptable debt instrument including revenue or general obligation bonds or debt issued pursuant to Environmental Improvement and Energy Resources Authority’s (EIERA) SRF program policy on annual appropriationbacked debt. Other financing securities will be reviewed on a case-by-case basis. Tax Increment Financing (TIF) security structures will not be considered. Loans must be amortized over twenty (20) years or less from loan closure. Repayment must begin within one

2. (1) year of project completion.

   1. (C) The commission may direct that existing and/or future loans be leveraged through the Environmental Improvement and Energy Resources Authority.
   2. (D) Loan payments will be made no more frequently than monthly.
   3. (E) If at any time during the loan period the facility(ies) financed under this rule is sold, either outright or on contract for deed, to other than a political subdivision of the state, the loan becomes due and payable upon transfer.
3. (13) Repayment of Grant. Repayment of the grant is required if the applicant fails to obtain and meet reporting requirements of all DNR permits for all facilities owned by the recipient. The grant may also be required to be repaid at a straight-line depreciated rate if the facilities constructed with grant funds are sold to private ownership.
4. (14) Stormwater Revolving Fund. Storm water grants and loans may be awarded from the stormwater revolving fund as funds are available. Eligible applicants must be a municipality, county, public sewer district, public water district, or a combination of the same. Except for subsections (3)(A)–(C), all provisions of this regulation apply to grants and loans made from the stormwater revolving fund.

AUTHORITY: section 644.026, RSMo 2000 and section 644.570, RSMo Supp. 2008.* Original rule filed June 9, 1999, effective March 30, 2000. Emergency amendment filed Feb. 1, 2007, effective March 4, 2007, expired Aug. 30, 2007. Amended: Filed March 14, 2007, effective Oct. 30, 2007. Amended: Filed March 16, 2009, effective Dec. 30, 2009.

*Original authority: 644.026, RSMo 1972, amended 1973, 1987, 1993, 1995, 2000 and 644.570, RSMo 1999, amended 2008.