33 Miss. Code. R. 18-VI
The SDWA provides the state with the flexibility to determine how to best utilize the LSLR Cap grant. To meet the goals of public water systems in the State of Mississippi and this FFY-2023 LSLR RJP, those projects which meet the following will be given priority:
Projects will be placed on the fundable portion of the Priority List according to both priority ranking and readiness to proceed. The term "ready to proceed" means that all loan application requirements established in the Program regulations are met, and all documents necessary for loan award are approved. If a project cannot reasonably be expected to meet the Priority System deadlines, then the project will not be placed on the current year's Priority List but will be placed on the Planning List. It is the Board's judgment with input from the DWSIRLF staff as to when a project is ready to proceed. Loans will be awarded to projects (within available funds) that are above the funding line on the current year's Priority List, that have met all Priority System deadlines and are ready to proceed. Additionally, when potential loan recipients are deciding on the needs for their public water supplies, they should ensure that all public health and state safe drinking water laws are followed.
Should any projects on the FFY-2023 LSLR Priority List (which are above the funding line) fail to comply with the deadlines in Section D, the project shall be bypassed, and the funds reserved for said project will be released. Released funds will first be made available to listed projects, to ensure that all projects above the funding line meeting priority system deadlines are funded. Any remaining funds will be made available to the highest-ranking project(s) shown below the funding line that is ready for loan award at the time funds become available. If no projects above the funding line are ready for loan award at the time funds become available, projects shown below the funding line will be funded on a first-come, first-served basis as they become ready for loan award and until the released funds are awarded. This same process will continue as each deadline passes and released funds become available.
Any funds recovered from loan decreases during the year will be used:
Any funds not obligated for these purposes may be made available for new loan awards ready to proceed on a first-come, first-served basis.
49% of the FFY-2023 LSLR Cap Grant will be subsidized. Based on the Grant of $28,650,000, the required amount of subsidization is $14,038,500. The DWSIRLF's subsidization will be in the form of "Principal Forgiveness" (PF) to individual public water supplies that are considered disadvantaged communities, and which received reimbursements with Federal LSLR Cap Grant funds during the lifetime of the project, from loan initiation through loan closeout. If the amount of PF which a project is eligible exceeds the amount of Federal LSLR Cap grant funds which it received, the amount of PF extended will be limited to the amount of Federal Cap grant funds used for reimbursement.
Subsidization may be used over a two-year period. Subsidization remaining from a previous year may be awarded to loans which are eligible for PF over a two-year period. Subsidization for FFY-2023 LSLR Priority List projects may be awarded to projects eligible for PF in FFY-2025 and FFY-2026.
Disadvantaged Community Program
For this funding, the following Principal Forgiveness (PF) methodology will be used to meet the requirements of the BIL (P.L. 117-8) for providing subsidy for disadvantaged systems. For the LSLR fund, 49% will be subsidized. The FFY-2023 LSLR federal appropriation for the Program is $28,650,000. The principal forgiveness (49%) allowable to eligible borrowers is $14,038,500.
The amount of PF for which a potential "Loan Recipient" (LR) may be eligible will be determined by calculating the percentage of the "Median Household Income" (MHI) of the potential LR versus the MM of the State of Mississippi ($52,719) as a whole.
90% < LRMHI < 100% | - 49% Principal Forgiveness |
80% < LR MHI < 90% | - 56% Principal Forgiveness |
70% < LR MHI < 80% | - 63% Principal Forgiveness |
LR MHI < 70% | - 70% Principal Forgiveness |
PF will be extended to projects until all mandated subsidy funds are obligated. Due to the limited amount of PF funds, the maximum amount of PF funds a loan recipient may receive for a project will be 70% of the project budget, which is capped at $5,000,000. The amount of PF given will be assigned at loan award. Once subsidy funds are depleted, only standard loans will be made with DWSIRLF funds.
In the event that a LR declines their loan that includes PF, the released PF may be reallocated to other projects for the present fiscal year that are eligible for PF, or the PF may be carried over to projects for the next fiscal year.
If returned PF funds are reallocated to projects awarded during the existing fiscal year. The reallocation of PF will be given first to projects which did not receive their full allowable amount based on the above table up to the maximum allowed limit.
In all cases, the amount of PF which is awarded to a project may not exceed the amount of Federal Cap grant funds which the project was reimbursed during the construction of the project.
DWSRF LSLR Priority System
Project Categories applicable to the DWSRF Base/Supplemental RJP that have been eliminated from this LSLR RJP because they are not applicable are Categories I through II and IV through XII. Projects for the LSLR Priority List will be ranked from Categories III through XIII in priority order; that is, all Category III projects are ranked higher than subsequent category projects, etc. Ranking is established in the same manner for the remaining categories. Adjustments are made as necessary to comply with the set-aside provisions of the Federal SDWA and as established by the Board [Section 1542(a)(2) of SDWA]. As stated previously, the order of Categories III - XIII is intended to give highest priority to those projects that address the most serious risks to human health. Projects within each category will be ranked as described in Section C.
All projects must meet the requirement of the LSLR Cap Grant appropriation; that they are lead service line replacement projects or project activities directly connected to the identification, planning, design, and replacement of lead service; for example, lead service line inventory projects. 100% of lead service lines must be replaced for lead service line projects, including privately and publicly-owned portions of the line.
This category includes projects to facilitate compliance with Primary Drinking Water Standards. To qualify for this category, projects must correct deficiencies resulting in non-compliance with the primary drinking water standards.
This category includes projects that do not meet the criteria of any other listed category and have been determined LSLR loan eligible in accordance with the DWSIRLF program regulations.
The criteria for ranking projects within each category is intended to give priority to projects that:
Benefit/Cost points assigned to each project will be determined using the following formula:
The number of benefiting connections must be included in the facilities plan submitted by the applicant; be defined as the sum of individual connections currently experiencing deficiencies that will be corrected by the improvement; and include only existing residences, businesses, and public buildings. Applicants must furnish information (including hydraulic analysis, if necessary) to support their estimate of the number of benefiting connections. The total eligible cost is in millions of dollars (i.e., $800,000 = $0.8 M).
An affordability factor will be assigned to each project to reflect the relative needs of applicants on a per household basis. The Benefit/Cost points calculated in Section C.1. will be adjusted using the affordability factor in the following formula:
The affordability factor used in the calculation is defined as the ratio of the "Median Household Income" (MHI) for the State of Mississippi ($52,719) to the MHI for the affected community. The affordability factor used in the calculation will be no less than 1.0 and no greater than 1.5.
The MSDH, with the Board's approval, has contracted with Mississippi State University Extension Service to provide both short-term and long-term assistance to designated water systems in the state based on their scores on the latest Capacity Assessment Form (CAF). This assistance is provided at no cost to the water systems.
Participation by the water systems in these assistance programs is voluntary; however, any water system that has participated in either of these assistance programs within the past two years will be eligible to receive additional priority points equal to 5% of their Adjusted Benefit/Cost Points. Water systems that have implemented all the recommendations made by Mississippi State University Extension Service will receive additional priority points equal to 5% of their Adjusted Benefit/Cost Points for a total of 10%. Documentation of participation in either of these assistance programs and implementation of the recommendations made by Mississippi State University Extension Service must be included in the facilities plan before additional priority points will be granted.
** 5% if the water system participates in the assistance, or 10% if the water system participates in the assistance and implements all recommendations
Any water system certifying and providing support of their Asset Management Plan's implementation or maintenance to MSDH will be eligible to receive additional priority points equal to 10% of their Adjusted Benefit/Cost Points.
Within each category, projects will be ranked in order based on the total points assigned the project using the following formula:
Total Priority Points = Adjusted Benefit/Cost Points + Affordability Points + Assistance Program Points + Asset Management Plan Points
Projects receiving the most priority points will be given the highest ranking on the Priority List. In case of a tie in the number of priority points, projects with the lowest median household income will receive the highest ranking.
A complete DWSIRLF facilities plan includes: all Intergovernmental Review (IGR) agency comments; proof of publication of advertisement for public hearing; a transcript of the public hearing comments; copies of any comments received from the public; and a summary of how each comment was addressed. The loan applicant should provide a copy of the facilities plan to USDA - Rural Utilities Service (RUS); if the loan applicant has an existing debt with RUS, their approval to incur the additional debt must be obtained and provided as part of the plan.
Any significant changes made to the facilities plan (i.e., changes in the chosen alternative location of the facility, cost increases that substantially affect the financial capability of the loan recipient) after this date will be considered a first submittal of the facilities plan. The loan applicant will then be in violation of the Priority System deadline and the project will be placed on the planning portion of the priority list. If the change is made after adoption of the IUP, funds reserved for this project may be released and made available to other projects.
33 Miss. Code. R. 18-VI