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                                                      PRINTER'S NO. 1650

THE GENERAL ASSEMBLY OF PENNSYLVANIA


SENATE BILL

No. 1102 Session of 2004


        INTRODUCED BY GORDNER, JUBELIRER, BRIGHTBILL, MADIGAN, WENGER,
           RHOADES, LEMMOND, ORIE, RAFFERTY, ERICKSON, PILEGGI, CORMAN,
           SCHWARTZ, C. WILLIAMS, PIPPY, EARLL, MOWERY AND WAUGH,
           MAY 26, 2004

        REFERRED TO ENVIRONMENTAL RESOURCES AND ENERGY, MAY 26, 2004

                                     AN ACT

     1  Amending Titles 12 (Commerce and Trade) and 64 (Public
     2     Authorities and Quasi-Public Corporations) of the
     3     Pennsylvania Consolidated Statutes, providing for water
     4     supply and wastewater infrastructure capitalization; defining
     5     "investor-owned water or wastewater enterprise"; and
     6     providing for Water Supply and Wastewater Infrastructure
     7     Program.

     8     The General Assembly of the Commonwealth of Pennsylvania
     9  hereby enacts as follows:
    10     Section 1.  Title 12 of the Pennsylvania Consolidated
    11  Statutes is amended by adding a chapter to read:
    12                             CHAPTER 39
    13                    WATER SUPPLY AND WASTEWATER
    14                   INFRASTRUCTURE CAPITALIZATION
    15  Sec.
    16  3901.  Scope of chapter.
    17  3902.  Definitions.
    18  3903.  Establishment.
    19  3904.  Award of grants.


     1  3905.  Award and administration of loans.
     2  3906.  Funds.
     3  § 3901. Scope of chapter.
     4     This chapter relates to the Water Supply and Wastewater
     5  Infrastructure Capitalization Program.
     6  § 3902.  Definitions.
     7     The following words and phrases when used in this chapter
     8  shall have the meanings given to them in this section unless the
     9  context clearly indicates otherwise:
    10     "Applicant."  A municipality, a municipal authority,
    11  industrial development corporation or an investor-owned water or
    12  wastewater enterprise that submits an application under 64
    13  Pa.C.S. § 1558 (relating to Water Supply and Wastewater
    14  Infrastructure Program).
    15     "Authority."  The Commonwealth Financing Authority
    16  established under 64 Pa.C.S. § 1511 (relating to authority).
    17     "Cost of a project."  Any of the following:
    18         (1)  Costs and expenses of acquisition of interests in
    19     land, infrastructure, buildings, structures, equipment,
    20     furnishings, fixtures and other tangible property which
    21     comprises the project.
    22         (2)  Costs and expenses of construction, reconstruction,
    23     erection, equipping, expansion, improvement, installation,
    24     rehabilitation, renovation or repair of infrastructure,
    25     buildings, structures, equipment and fixtures which comprise
    26     the project.
    27         (3)  Costs and expenses of demolishing, removing or
    28     relocating buildings or structures on lands acquired or to be
    29     acquired.
    30         (4)  Costs and expenses of preparing land for
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     1     development.
     2         (5)  Costs and expenses of engineering services,
     3     financial services, accounting services, legal services,
     4     plans, specifications, studies and surveys necessary or
     5     incidental to determining the feasibility or practicability
     6     of the project.
     7     "Industrial development corporation."  An entity certified as
     8  an industrial development agency by the Pennsylvania Industrial
     9  Development Authority Board under the act of May 17, 1956 (1955
    10  P.L.1609, No.537), known as the Pennsylvania Industrial
    11  Development Authority Act.
    12     "Investor-owned water or wastewater enterprise."  A nonpublic
    13  entity which supplies water or provides wastewater services to
    14  the public for a fee.
    15     "Municipal authority."  A public authority created under 53
    16  Pa.C.S. Ch. 56 (relating to municipal authorities) or under the
    17  former act of May 2, 1945 (P.L.382, No.164), known as the
    18  Municipality Authorities Act of 1945, which supplies water or
    19  provides wastewater services to the public for a fee.
    20     "Project."  An activity approved for a grant or loan under 64
    21  Pa.C.S. § 1558 (relating to Water Supply and Wastewater
    22  Infrastructure Program).
    23  § 3903.  Establishment.
    24     There is established within the department a program to be
    25  known as the Water Supply and Wastewater Infrastructure
    26  Capitalization Program. The program shall finance single-year or
    27  multiyear grants to municipalities and municipal authorities and
    28  loans to municipalities, municipal authorities, industrial
    29  development corporations and investor-owned water or wastewater
    30  enterprises or projects which are approved by the Commonwealth
    20040S1102B1650                  - 3 -     

     1  Financing Authority and which, when completed, construct, expand
     2  or improve water and wastewater infrastructure which is related
     3  to economic development.
     4  § 3904.  Award of grants.
     5     Upon being notified by the authority that a grant has been
     6  approved under 64 Pa.C.S. § 1558(c) (relating to Water Supply
     7  and Wastewater Infrastructure Program) for a municipality or
     8  municipal authority, the department shall, within 45 days of
     9  receiving notice, enter into a contract with the municipality or
    10  municipal authority. The contract shall be for the amount
    11  approved by the authority. Upon entering into a contract with
    12  the municipality or municipal authority, the department shall
    13  award the grant for the amount specified in the contract.
    14  § 3905.  Award and administration of loans.
    15     (a)  Award.--
    16         (1)  Upon being notified that a loan has been approved
    17     under 64 Pa.C.S. § 1558(c) (relating to Water Supply and
    18     Wastewater Infrastructure Program) for an applicant, the
    19     department shall, within 45 days of receiving notice, enter
    20     into a contract with the applicant. The contract shall be for
    21     the amount approved and shall specify the terms of the loan
    22     in accordance with all of the following:
    23             (i)  A loan shall be at an interest rate not to
    24         exceed 1%.
    25             (ii)  A loan shall be for a term not to exceed 20
    26         years.
    27         (2)  Upon entering into a contract with the applicant,
    28     the department shall award the loan for the amount specified
    29     in the contract.
    30     (b)  Administration.--Loans made under this section shall be
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     1  administered by the department. Loan payments received by the
     2  department for a loan awarded under this section shall be
     3  deposited in the General Fund.
     4  § 3906.  Funds.
     5     Proceeds of the borrowing authorized by the electors pursuant
     6  to the act of February 12, 2004 (P.L.72, No.10), known as the
     7  Water and Wastewater Treatment Project Bond Act, shall be used
     8  by the department in funding grants and loans awarded under this
     9  chapter.
    10     Section 2.  Section 1504 of Title 64, added April 1, 2004
    11  (P.L.163, No.22), is amended by adding a definition to read:
    12  § 1504.  Definitions.
    13     The following words and phrases when used in this chapter
    14  shall have the meaning given to them in this section unless the
    15  context clearly indicates otherwise:
    16     * * *
    17     "Investor-owned water or wastewater enterprise."  A nonpublic
    18  entity which supplies water or provides wastewater services to
    19  the public for a fee.
    20     * * *
    21     Section 3.  Title 64 is amended by adding a section to read:
    22  § 1558.  Water Supply and Wastewater Infrastructure Program.
    23     (a)  Establishment.--There is established a program to be
    24  known as the Water Supply and Wastewater Infrastructure Program.
    25  The program shall provide financial assistance in the form of
    26  single-year or multiyear grants to municipalities and municipal
    27  authorities and in the form of loans to municipalities,
    28  municipal authorities, industrial development corporations and
    29  investor-owned water or wastewater enterprises for projects
    30  which, when completed, construct, expand or improve water and
    20040S1102B1650                  - 5 -     

     1  wastewater infrastructure which is related to economic
     2  development.
     3     (b)  Application.--A municipality, a municipal authority, an
     4  industrial development corporation or an investor-owned water or
     5  wastewater enterprise may submit an application to the authority
     6  requesting financial assistance for a project. The application
     7  must be on the form required by the board and must include or
     8  demonstrate all of the following:
     9         (1)  The name and address of the applicant.
    10         (2)  A statement of the type and amount of financial
    11     assistance sought. If the applicant is requesting financial
    12     assistance in the form of a grant, the request may not exceed
    13     75% of the cost of the project.
    14         (3)  A statement of the project, including a detailed
    15     statement of the cost of the project.
    16         (4)  A financial commitment from a responsible source for
    17     any cost of the project in excess of the amount requested. If
    18     the applicant is requesting financial assistance in the form
    19     of a grant from the department, the financial commitment may
    20     not be in the form of a grant from a Commonwealth agency.
    21         (5)  A firm commitment from the project user to use the
    22     project upon completion.
    23         (6)  Proof that the applicant has secured planning and
    24     permit approvals for the project from the Department of
    25     Environmental Protection.
    26         (7)  Any other information required by the board.
    27     (c)  Review and approval of grant applications.--
    28         (1)  If an applicant is requesting financial assistance
    29     in the form of a grant, the authority, in conjunction with
    30     the Department of Environmental Protection, shall review the
    20040S1102B1650                  - 6 -     

     1     application to determine all of the following:
     2             (i)  That the applicant is not an investor-owned
     3         water or wastewater enterprise.
     4             (ii)  If the project is related to economic
     5         development.
     6             (iii)  If there is a financial commitment for at
     7         least 25% of the project.
     8             (iv)  If the source of the financial commitment is
     9         from a responsible source.
    10             (v)  If the municipality or municipal authority is
    11         firmly committed to using the project upon completion.
    12             (vi)  If the municipality or municipal authority has
    13         secured planning and permit approvals for the project
    14         from the Department of Environmental Protection.
    15             (vii)  That the municipality or municipal authority
    16         did not receive a grant or loan under section 1551
    17         (relating to Business in Our Sites Program) for the
    18         project.
    19             (viii)  If the municipality or municipal authority
    20         complied with all other criteria established by the
    21         board.
    22         (2)  Upon being satisfied that all program requirements
    23     have been met, the authority may approve the application in
    24     accordance with all of the following:
    25             (i)  The grant may not exceed $5,000,000 per project.
    26             (ii)  Grants under this program shall not exceed
    27         $10,000,000 in the aggregate per municipality or
    28         municipal authority.
    29             (iii)  The aggregate amount of grants awarded under
    30         this subsection shall not exceed $125,000,000.
    20040S1102B1650                  - 7 -     

     1         (3)  If the authority approves the application, the
     2     authority shall notify the department of the amount approved.
     3     (d)  Review and approval of loan applications.--
     4         (1)  If an applicant is requesting financial assistance
     5     in the form of a loan, the department, in conjunction with
     6     the Department of Environmental Protection, shall review the
     7     application to determine all of the following:
     8             (i)  If the project is related to economic
     9         development.
    10             (ii)  If a financial commitment exists for any cost
    11         of the project in excess of the amount requested.
    12             (iii)  If the source of the financial commitment is
    13         from a responsible source.
    14             (iv)  If the project user is firmly committed to
    15         using the project upon completion.
    16             (v)  If the applicant has secured planning and permit
    17         approvals for the project from the Department of
    18         Environmental Protection.
    19             (vi)  That the applicant did not receive a grant or
    20         loan under section 1551 for the project.
    21             (vii)  If the applicant complied with all other
    22         criteria established by the board.
    23         (2)  Upon being satisfied that all program requirements
    24     have been met, the board may approve the application in
    25     accordance with all of the following:
    26             (i)  The loan may not exceed $5,000,000 per project.
    27             (ii)  Loans under this program shall not exceed
    28         $10,000,000 in the aggregate per applicant.
    29         (3)  If the authority approves the application, the
    30     authority shall notify the department of the amount approved.
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     1     Section 4.  This act shall take effect immediately.




















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