Bredesen Signs Bill Allowing Tennessee to Receive Recovery Act Funds for Water Projects
Wednesday, June 10, 2009 | 04:54am
NASHVILLE – Governor Phil Bredesen has signed into law HB2294, clearing the way for Tennessee to receive an anticipated $79 million in funds through the American Recovery and Reinvestment Act (ARRA) for clean water and drinking water projects across Tennessee.
The legislation allows the Department of Environment and Conservation to forgive a portion of a community’s debt when it receives low-interest loans under the State Revolving Fund (SRF) loan program. The debt forgiveness provision is a requirement of the Recovery Act. The new law opens the door for Tennessee to receive ARRA funds for clean water and drinking water infrastructure projects from the U.S. Environmental Protection Agency.
“I’m pleased to sign this legislation that will benefit water quality across Tennessee, create jobs and assist communities with the cost of infrastructure improvements,” said Bredesen. “The Recovery Act’s requirement that the state have the ability to forgive a portion of the debt incurred under the State Revolving Fund program will help communities that need to make these critical infrastructure improvements in tough economic times.”
The debt forgiveness provision means part of the funding distributed to communities, water authorities and utilities will be in the form of a grant, which does not need to be repaid. Tennessee’s allocations from EPA are expected to be approximately $59 million for the Clean Water State Revolving Fund to fund planning, design and construction of wastewater facilities and approximately $20 million for the Drinking Water State Revolving Fund to fund planning, design and construction of drinking water facilities.
“Utilizing Recovery Act money, we will be able to provide funding through the State Revolving Fund program with 40 percent debt forgiveness,” said Environment and Conservation Commissioner Jim Fyke. “We will combine the recovery funds, which include this grant provision, with existing SRF loan funding to leverage all available resources for Tennessee communities.”
There are extensive reporting requirements for ARRA in addition to the requirements of the State Revolving Fund program. If a community cannot meet these requirements, the next project on the priority list will be chosen. All applicants must be approved by the Tennessee Local Development Authority prior to receiving any funding under the SRF program.
In addition to debt forgiveness, ARRA also requires 20 percent of funding for each SRF program go toward “green” infrastructure, water or energy efficiency improvements or other environmentally innovative activities.
All ARRA funds through the SRF program must be obligated by Feb. 17, 2010 and utilities, water authorities or communities must have a signed construction contract or must have begun construction by the same date.
Information on this program, including the list of prioritized projects, as well as information on other stimulus funds available through the Tennessee Department of Environment and Conservation can be found at www.tn.gov/environment/recovery.