33 Miss. Code. R. 17-IV
This section outlines all sources of funding available to the DWSIRLF Program and indicates intended uses. This section also describes the financial assistance terms available through the Program.
The FFY-2024 EPA Capitalization Grant allotment for Mississippi of $5,837,000 has a 20% state match of $1,167,400 is required and the FFY-2024 BIL Supplemental Capitalization Grant allotment of $28,785,000 with a 20% the state match requirement of $5,757,000 this provides an amount of $41,546,400 for both loans and set-aside activities.
A national reallotment of funding made available to the State after Wyoming passed on its 2021 allotment. The State will amend its 2021 capitalization grant to access the additional $30,000 in funding. State match of $6,000 will be earmarked from funding available to the program to meet the required 20%.
The FFY-2024 "Set-aside" uses for the standard Cap grant and BIL Supplemental Cap grant are outlined in Section V of this IUP. Necessary work plans showing utilization of these funds are found in the appendices of this IUP.
With the FFY-2024 Capitalization Grant for Mississippi of $5,837,000 the state match requirement to federal grant funds will be 20% state match funds to 80% federal grant funds; this requirement will be stated in the grant application.
The FFY-2024 BIL Supplemental Capitalization Grant allotment for Mississippi of $28,785,000 the state match requirement to federal grant funds will be 20% state match funds to 80% federal grant funds; this requirement will be stated in the grant application.
The 2024 State Legislature will authorize an appropriation or the issuance of bonds to be used as match for the FFY-2024 EPA Capitalization Grants. An amount of $6,531,800 is required to fully match the FFY-2024 EPA Capitalization Grants.
Beginning in FFY-2003 the Board began to make loan awards after approval of the facilities plans and loan application, rather than after completion of the project design. This change in the loan award sequence increased the likelihood that bid overruns on some projects could be greater than the construction contingency included in the loan agreement. In order to be able to provide loan increases (when needed) to existing loans, the Board intends to set-aside the $2,000,000 for such loan increases; loan increases will be awarded on a first-come, first-served basis. Any funds not obligated for these purposes by the end of the fiscal year may be made available for new loan awards to the highest-ranking project(s) that is ready for loan award at the time funds become available.
In accordance with the Board's desire to maintain a financially sound DWSIRLF loan Fund in perpetuity, while at the same time meeting a substantial portion of the drinking water needs in the state within a reasonable period of time, the following financial decisions were made regarding the Fund:
The Board intends that the MSDH apply for the entire state Cap grant allotment under the federal DWSRF, including the set-asides described in Section V below. State bond proceeds obtained shall be deposited into the DWSIRLF and shall be used as the state match for federal DWSRF Cap grants.
It is the Board's intention to adjust interest rates such that the demand will equal the funds available. In order to ensure that this interest rate will be at or below the prevailing market rates at the time a loan is made, this rate will be compared to the twenty-year (20) triple-A rated, tax-exempt insured revenue bond yield published by fmsbonds, Inc. (fmsbonds Online, https://www.fmsbonds.com/market-yields/).
Investment Procedures for Excess Cash - According to the State Treasurer, the excess cash in the Fund is invested by the State Treasurer in securities prescribed in Section 27-105-33, et. Seq., of the Mississippi Code of 1972 Annotated, as amended. The securities in which state funds may be invested include certificates of deposit with qualified state depositories, repurchase agreements (fully secured by direct United States Treasury obligations, United States Government agency obligations, United States Government instrumentalities or United States Government sponsored enterprise obligations), direct United States Treasury obligations, United States Government agency obligations, United States Government instrumentalities or United States Government sponsored enterprise obligations, and any other open-ended or closed-ended management type investment company or investment trust registered under the provisions of 15 U.S.C. Section 80(a)-1 et. Seq, provided that the portfolio is limited to direct obligations issued by the United States of America, United States Government agency obligations, United States Government instrumentalities or United States Government sponsored enterprise obligations and to repurchase agreements fully collateralized by the securities listed above for repurchase agreements.
The following terms will be used for the purpose of making loans to the public water systems within the State of Mississippi.
Under state law, the Board has the discretion to set the maximum amount for DWSIRLF loans. For FFY-2024 the Board has set a maximum loan amount of $5,000,000 per borrower. The Board may allow (on a case-by-case basis if requested by the borrower and the need has been justified) the maximum loan limit to be exceeded by a vote of the Board. Furthermore, during FFY-2024, no more than one loan per borrower will be allowed. At the end of the fiscal year, if funds are available, systems previously receiving an award during FFY-2024 may obtain an additional award(s) or an increase to a previous award, if no other eligible systems are evident.
All loan terms will be the lesser of 1.95% annual interest rate or the twenty-year (20) triple-A rated, tax-exempt insured revenue bond yield published by fmsbonds, Inc., compounded monthly, with a standard 20-year term. The maximum loan amortization allowable will be 30 years, or 40 years for disadvantaged communities (the America's Water Infrastructure Act of 2018). These maximums may not, however exceed the design life of the project. Interest will accrue based on the current loan agreement in conjunction with the DWSIRLF Regulations.
THIS IS NOT AN ADDITIONAL FEE TO OUR LOAN RECIPENTS. This revenue is diverted from the interest portion of loan repayments to defray administrative costs related to the program. The program will collect up to 5% of the initial loan principal or the total amount of interest due over the life of the loan, whichever is less, to defray administrative cost. This fee will be collected from the interest portion of loan repayments on all FFY-2024 loans.
The Federal 2024 appropriations bill has been finalized and the final EPA FFY-2024 Cap Grant allotment amounts, and any additional federal requirements are known. Subsidization requirements will be required for the FFY-2024 Cap Grant; the subsidization is in the form of "principal forgiveness", "negative interest rates", or a combination of the two. The amount of subsidization is a minimum of 26% of the Cap Grant amount. The FFY-2024 Cap Grant is $5,837,000 and the subsidization amount will be $1,517,620 (26%) of the Cap Grant amount. Furthermore, all loans made with all or part FFY-2024 federal appropriation funds will include the Davis-Bacon Act, American Iron and Steel, and BABA signage requirements. Appropriate language will be added to all FFY-2024 loan agreements identifying the additional responsibilities for loan recipients. "Green Infrastructure" requirements are not an appropriation requirement. However, the Program will continue to encourage those types of projects to seek funding from the DWSIRLF.
33 Miss. Code. R. 17-IV