Title IV-A - Water Pollution Control and Public Water Supplies - Illinois Statutes

      (415 ILCS 5/Tit. IV‑A heading)TITLE IV‑A: WATER POLLUTION CONTROL AND PUBLIC WATER SUPPLIES

    (415 ILCS 5/19.1)(from Ch. 111 1/2, par. 1019.1)
    Sec. 19.1. Legislative findings. The General Assembly finds:
    (a) that local government units require assistance in financing the construction of wastewater treatment works in order to comply with the State's program of environmental protection and federally mandated requirements;
    (b) that the federal Water Quality Act of 1987 provides an important source of grant awards to the State for providing assistance to local government units through the Water Pollution Control Loan Program;
    (c) that local government units and privately owned community water supplies require assistance in financing the construction of their public water supplies to comply with State and federal drinking water laws and regulations;
    (d) that the federal Safe Drinking Water Act ("SDWA"), P.L. 93‑523, as now or hereafter amended, provides an important source of capitalization grant awards to the State to provide assistance to local government units and privately owned community water supplies through the Public Water Supply Loan Program;
    (e) that violations of State and federal drinking water standards threaten the public interest, safety, and welfare, which demands that the Illinois Environmental Protection Agency expeditiously adopt emergency rules to administer the Public Water Supply Loan Program;
    (f) that the General Assembly agrees with the conclusions and recommendations of the "Report to the Illinois General Assembly on the Issue of Expanding Public Water Supply Loan Eligibility to Privately Owned Community Water Supplies", dated August 1998, including the stated access to the Public Water Supply Loan Program by the privately owned public water supplies so that the long term integrity and viability of the corpus of the Fund will be assured; and
    (g) that the American Recovery and Reinvestment Act of 2009 provides a source of capitalization grant awards to the State to provide loans and additional subsidization, including, but not limited to, forgiveness of principal, negative interest loans, and grants, to local government units through the Water Pollution Control Loan Program and to local government units and privately owned community water supplies through the Public Water Supply Loan Program.
(Source: P.A. 96‑8, eff. 4‑28‑09.)

(415 ILCS 5/19.2) (from Ch. 111 1/2, par. 1019.2)     Sec. 19.2. As used in this Title, unless the context clearly requires otherwise:     (a) "Agency" means the Illinois Environmental Protection Agency.     (b) "Fund" means the Water Revolving Fund created pursuant to this Title, consisting of the Water Pollution Control Loan Program, the Public Water Supply Loan Program, and the Loan Support Program.     (c) "Loan" means a loan made from the Water Pollution Control Loan Program or the Public Water Supply Loan Program to an eligible applicant as a result of a contractual agreement between the Agency and such applicant.     (d) "Construction" means any one or more of the following which is undertaken for a public purpose: preliminary planning to determine the feasibility of the treatment works or public water supply, engineering, architectural, legal, fiscal or economic investigations or studies, surveys, designs, plans, working drawings, specifications, procedures or other necessary actions, erection, building, acquisition, alteration, remodeling, improvement or extension of treatment works or public water supplies, or the inspection or supervision of any of the foregoing items. "Construction" also includes implementation of source water quality protection measures and establishment and implementation of wellhead protection programs in accordance with Section 1452(k)(1) of the federal Safe Drinking Water Act.     (e) "Intended use plan" means a plan which includes a description of the short and long term goals and objectives of the Water Pollution Control Loan Program and the Public Water Supply Loan Program, project categories, discharge requirements, terms of financial assistance and the loan applicants to be served.     (f) "Treatment works" means any devices and systems owned by a local government unit and used in the storage, treatment, recycling, and reclamation of sewerage or industrial wastes of a liquid nature, including intercepting sewers, outfall sewers, sewage collection systems, pumping power and other equipment, and appurtenances; extensions, improvements, remodeling, additions, and alterations thereof; elements essential to provide a reliable recycled supply, such as standby treatment units and clear well facilities; and any works, including site acquisition of the land that will be an integral part of the treatment process for wastewater facilities.     (g) "Local government unit" means a county, municipality, township, municipal or county sewerage or utility authority, sanitary district, public water district, improvement authority or any other political subdivision whose primary purpose is to construct, operate and maintain wastewater treatment facilities or public water supply facilities or both.     (h) "Privately owned community water supply" means:         (1) an investor‑owned water utility, if under

Illinois Commerce Commission regulation and operating as a separate and distinct water utility;

(2) a not‑for‑profit water corporation, if operating

specifically as a water utility; and

(3) a mutually owned or cooperatively owned

community water system, if operating as a separate water utility.

(Source: P.A. 91‑36, eff. 6‑15‑99; 91‑52, eff. 6‑30‑99; 91‑501, eff. 8‑13‑99; 92‑16, eff. 6‑28‑01.)

    (415 ILCS 5/19.3)(from Ch. 111 1/2, par. 1019.3)
    Sec. 19.3. Water Revolving Fund.
    (a) There is hereby created within the State Treasury a Water Revolving Fund, consisting of 3 interest‑bearing special programs to be known as the Water Pollution Control Loan Program, the Public Water Supply Loan Program, and the Loan Support Program, which shall be used and administered by the Agency.
    (b) The Water Pollution Control Loan Program shall be used and administered by the Agency to provide assistance for the following purposes:
        (1) to accept and retain funds from grant awards,

appropriations, transfers, and payments of interest and principal;

(2) to make direct loans at or below market interest

rates and to provide additional subsidization, including, but not limited to, forgiveness of principal, negative interest rates, and grants, to any eligible local government unit to finance the construction of wastewater treatments works and projects that fulfill federal State Revolving Fund grant requirements for a green project reserve;

(2.5) with respect to funds provided under the

American Recovery and Reinvestment Act of 2009:

(A) to make direct loans at or below market

interest rates to any eligible local government unit and to provide additional subsidization to any eligible local government unit, including, but not limited to, forgiveness of principal, negative interest rates, and grants;

(B) to make direct loans at or below market

interest rates to any eligible local government unit to buy or refinance debt obligations for treatment works incurred on or after October 1, 2008; and

(C) to provide additional subsidization,

including, but not limited to, forgiveness of principal, negative interest rates, and grants for treatment works incurred on or after October 1, 2008;

(3) to make direct loans at or below market interest

rates and to provide additional subsidization, including, but not limited to, forgiveness of principal, negative interest rates, and grants, to any eligible local government unit to buy or refinance debt obligations for costs incurred after March 7, 1985, for the construction of wastewater treatment works, and projects that fulfill federal State Revolving Fund grant requirements for a green project reserve;

(3.5) to make direct loans at or below market

interest rates for the implementation of a management program established under Section 319 of the Federal Water Pollution Control Act, as amended;

(4) to guarantee or purchase insurance for local

obligations where such action would improve credit market access or reduce interest rates;

(5) as a source of revenue or security for the

payment of principal and interest on revenue or general obligation bonds issued by the State or any political subdivision or instrumentality thereof, if the proceeds of such bonds will be deposited in the Fund;

(6) to finance the reasonable costs incurred by the

Agency in the administration of the Fund; and

(7) to transfer funds to the Public Water Supply

Loan Program.

(c) The Loan Support Program shall be used and administered by the Agency for the following purposes:         (1) to accept and retain funds from grant awards and

appropriations;

(2) to finance the reasonable costs incurred by the

Agency in the administration of the Fund, including activities under Title III of this Act, including the administration of the State construction grant program;

(3) to transfer funds to the Water Pollution Control

Loan Program and the Public Water Supply Loan Program;

(4) to accept and retain a portion of the loan

repayments;

(5) to finance the development of the low interest

loan programs for water pollution control and public water supply projects;

(6) to finance the reasonable costs incurred by the

Agency to provide technical assistance for public water supplies; and

(7) to finance the reasonable costs incurred by the

Agency for public water system supervision programs, to administer or provide for technical assistance through source water protection programs, to develop and implement a capacity development strategy, to delineate and assess source water protection areas, and for an operator certification program in accordance with Section 1452 of the federal Safe Drinking Water Act.

(d) The Public Water Supply Loan Program shall be used and administered by the Agency to provide assistance to local government units and privately owned community water supplies for public water supplies for the following public purposes:         (1) to accept and retain funds from grant awards,

appropriations, transfers, and payments of interest and principal;

(2) to make direct loans at or below market interest

rates and to provide additional subsidization, including, but not limited to, forgiveness of principal, negative interest rates, and grants, to any eligible local government unit or to any eligible privately owned community water supply to finance the construction of water supplies and projects that fulfill federal State Revolving Fund grant requirements for a green project reserve;

(2.5) with respect to funds provided under the

American Recovery and Reinvestment Act of 2009:

(A) to make direct loans at or below market

interest rates to any eligible local government unit or to any eligible privately owned community water supply, and to provide additional subsidization to any eligible local government unit or to any eligible privately owned community water supply, including, but not limited to, forgiveness of principal, negative interest rates, and grants;

(B) to buy or refinance the debt obligation of a

local government unit for costs incurred on or after October 1, 2008; and

(C) to provide additional subsidization,

including, but not limited to, forgiveness of principal, negative interest rates, and grants for a local government unit for costs incurred on or after October 1, 2008;

(3) to make direct loans at or below market interest

rates and to provide additional subsidization, including, but not limited to, forgiveness of principal, negative interest rates, and grants, to any eligible local government unit or to any eligible privately owned community water supply to buy or refinance debt obligations for costs incurred on or after July 17, 1997, for the construction of water supplies and projects that fulfill federal State Revolving Fund requirements for a green project reserve;

(4) to guarantee local obligations where such action

would improve credit market access or reduce interest rates;

(5) as a source of revenue or security for the

payment of principal and interest on revenue or general obligation bonds issued by the State or any political subdivision or instrumentality thereof, if the proceeds of such bonds will be deposited into the Fund; and

(6) to transfer funds to the Water Pollution Control

Loan Program.

(e) The Agency is designated as the administering agency of the Fund. The Agency shall submit to the Regional Administrator of the United States Environmental Protection Agency an intended use plan which outlines the proposed use of funds available to the State. The Agency shall take all actions necessary to secure to the State the benefits of the federal Water Pollution Control Act and the federal Safe Drinking Water Act, as now or hereafter amended.     (f) The Agency shall have the power to enter into intergovernmental agreements with the federal government or the State, or any instrumentality thereof, for purposes of capitalizing the Water Revolving Fund. Moneys on deposit in the Water Revolving Fund may be used for the creation of reserve funds or pledged funds that secure the obligations of repayment of loans made pursuant to this Section. For the purpose of obtaining capital for deposit into the Water Revolving Fund, the Agency may also enter into agreements with financial institutions and other persons for the purpose of selling loans and developing a secondary market for such loans. The Agency shall have the power to create and establish such reserve funds and accounts as may be necessary or desirable to accomplish its purposes under this subsection and to allocate its available moneys into such funds and accounts. Investment earnings on moneys held in the Water Revolving Fund, including any reserve fund or pledged fund, shall be deposited into the Water Revolving Fund. (Source: P.A. 96‑8, eff. 4‑28‑09; 96‑917, eff. 6‑9‑10.)

    (415 ILCS 5/19.4)(from Ch. 111 1/2, par. 1019.4)
    Sec. 19.4. Regulations; priorities.
    (a) The Agency shall have the authority to promulgate regulations to set forth procedures and criteria concerning loan applications. For units of local government, the regulations shall include, but need not be limited to, the following elements:
        (1) loan application requirements;
        (2) determination of credit worthiness of the loan

applicant;

(3) special loan terms, as necessary, for securing

the repayment of the loan;

(4) assurance of payment;         (5) interest rates;         (6) loan support rates;         (7) impact on user charges;         (8) eligibility of proposed construction;         (9) priority of needs;         (10) special loan terms for disadvantaged

communities;

(11) maximum limits on annual distributions of funds

to applicants or groups of applicants;

(12) penalties for noncompliance with loan

requirements and conditions, including stop‑work orders, termination, and recovery of loan funds; and

(13) indemnification of the State of Illinois and

the Agency by the loan recipient.

(b) The Agency shall have the authority to promulgate regulations to set forth procedures and criteria concerning loan applications for loan recipients other than units of local government. In addition to all of the elements required for units of local government under subsection (a), the regulations shall include, but need not be limited to, the following elements:         (1) types of security required for the loan;         (2) types of collateral, as necessary, that can be

pledged for the loan; and

(3) staged access to fund privately owned community

water supplies.

(c) The Agency shall develop and maintain a priority list of loan applicants as categorized by need. Priority in making loans from the Public Water Supply Loan Program must first be given to local government units and privately owned community water supplies that need to make capital improvements to protect human health and to achieve compliance with the State and federal primary drinking water standards adopted pursuant to this Act and the federal Safe Drinking Water Act, as now and hereafter amended.     (d) The Agency shall have the authority to promulgate regulations to set forth procedures and criteria concerning loan applications for funds provided under the American Recovery and Reinvestment Act of 2009. In addition, due to time constraints in the American Recovery and Reinvestment Act of 2009, the Agency shall adopt emergency rules as necessary to allow the timely administration of funds provided under the American Recovery and Reinvestment Act of 2009. Emergency rules adopted under this subsection (d) shall be adopted in accordance with Section 5‑45 of the Illinois Administrative Procedure Act. (Source: P.A. 96‑8, eff. 4‑28‑09.)

(415 ILCS 5/19.5) (from Ch. 111 1/2, par. 1019.5)     Sec. 19.5. Loans; repayment.     (a) The Agency shall have the authority to make loans pursuant to the regulations promulgated under Section 19.4.     (b) Loans made from the Fund shall provide for:         (1) a schedule of disbursement of proceeds;         (2) a fixed rate that includes interest and loan

support based upon priority, but the loan support rate shall not exceed one‑half of the fixed rate established for each loan;

(3) a schedule of repayment;         (4) initiation of principal repayments within one

year after the project is operational; and

(5) a confession of judgment upon default.     (c) The Agency may amend existing loans to include a loan support rate only if the overall cost to the loan recipient is not increased.     (d) A local government unit shall secure the payment of its obligations to the Fund by a dedicated source of repayment, including revenues derived from the imposition of rates, fees and charges. Other loan applicants shall secure the payment of their obligations by appropriate security and collateral pursuant to regulations promulgated under Section 19.4. (Source: P.A. 91‑36, eff. 6‑15‑99; 91‑52, eff. 6‑30‑99; 91‑501, eff. 8‑13‑99; 92‑16, eff. 6‑28‑01.)

(415 ILCS 5/19.6) (from Ch. 111 1/2, par. 1019.6)     Sec. 19.6. Delinquent loan repayment.     (a) In the event that a timely payment is not made by a loan recipient according to the loan schedule of repayment, the loan recipient shall notify the Agency in writing within 15 days after the payment due date. The notification shall include a statement of the reasons the payment was not timely tendered, the circumstances under which the late payments will be satisfied, and binding commitments to assure future payments. After receipt of this notification, the Agency shall confirm in writing the acceptability of the plan or take action in accordance with subsection (b) of this Section.     (b) In the event that a loan recipient fails to comply with subsection (a) of this Section, the Agency shall promptly issue a notice of delinquency to the loan recipient, which shall require a written response within 15 days. The notice of delinquency shall require that the loan recipient revise its rates, fees and charges to meet its obligations pursuant to subsection (d) of Section 19.5 or take other specified actions as may be appropriate to remedy the delinquency and to assure future payments.     (c) In the event that the loan recipient fails to timely or adequately respond to a notice of delinquency, or fails to meet its obligations made pursuant to subsections (a) and (b) of this Section, the Agency shall pursue the collection of the amounts past due, the outstanding loan balance and the costs thereby incurred, either pursuant to the Illinois State Collection Act of 1986 or by any other reasonable means as may be provided by law, including the taking of title by foreclosure or otherwise to any project or other property pledged, mortgaged, encumbered, or otherwise available as security or collateral. (Source: P.A. 91‑36, eff. 6‑15‑99; 91‑52, eff. 6‑30‑99; 91‑501, eff. 8‑13‑99; 92‑16, eff. 6‑28‑01.)

(415 ILCS 5/19.7) (from Ch. 111 1/2, par. 1019.7)     Sec. 19.7. (Repealed). (Source: P.A. 90‑372, eff. 7‑1‑98. Repealed internally, eff. 7‑1‑98.)

(415 ILCS 5/19.8) (from Ch. 111 1/2, par. 1019.8)     Sec. 19.8. Advisory committees. The Director of the Agency shall appoint committees to advise the Agency concerning the financial structure of the Programs. The committees shall consist of representatives from appropriate State agencies, the financial community, engineering societies and other interested parties. The committees shall meet periodically and members shall be reimbursed for their ordinary and necessary expenses incurred in the performance of their committee duties. (Source: P.A. 90‑121, eff. 7‑17‑97; 91‑36, eff. 6‑15‑99; 91‑52, eff. 6‑30‑99; 91‑501, eff. 8‑13‑99.)

(415 ILCS 5/19.9) (from Ch. 111 1/2, par. 1019.9)     Sec. 19.9. This Title shall be liberally construed so as to effect its purpose. (Source: P.A. 91‑52, eff. 6‑30‑99.)

(415 ILCS 5/19.10)     Sec. 19.10. Re‑enactment of Title IV‑A; findings; purpose; validation.     (a) The General Assembly finds and declares that:         (1) Title IV‑A (consisting of Sections 19.1 through

19.9) was first added to the Environmental Protection Act by Article III of Public Act 85‑1135, effective September 1, 1988. In its original form, Title IV‑A created the Water Pollution Control Revolving Fund and authorized the Illinois Environmental Protection Agency to establish a program for providing units of local government with low‑cost loans to be used to construct wastewater treatment works. The loans are paid from the Revolving Fund, which consists primarily of a combination of federal grant money, State matching money, and money that has been repaid on past loans.

(2) In 1995, Title IV‑A was amended by Public Act

89‑27, effective January 1, 1997, which created the Loan Support Program and made other changes. The Loan Support Program provides financing for certain administrative costs of the Agency. It specifically includes the costs of developing a loan program for public water supply projects.

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