Bill Text: IL HB4382 | 2013-2014 | 98th General Assembly | Engrossed

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Bill Title: Amends the Environmental Protection Act. Removes a provision requiring rule to include a requirement for a local match of 30% of the total project cost for projects funded through grants. Adds to the definition of "treatment works". Provides that the Water Pollution Control Loan Program shall be used and administered by the Environmental Protection Agency to provide any financial assistance that may be provided under a specified provision of the Federal Water Pollution Control Act for any projects eligible for assistance under that provision. Effective immediately.

Spectrum: Moderate Partisan Bill (Democrat 12-2)

Status: (Failed) 2014-12-03 - Session Sine Die [HB4382 Detail]

Download: Illinois-2013-HB4382-Engrossed.html

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AN ACT concerning safety.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Environmental Protection Act is amended by
changing Sections 19.1, 19.2, 19.3, and 19.4 as follows:
(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 water wastewater treatment works
and projects 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

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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; .
(h) that expanding eligibility to include publicly owned
municipal storm water projects eligible for financing as

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treatment works, as defined under Section 212 of the Federal
Water Pollution Control Act, will provide the Agency with the
statutory authority to use moneys in the Water Pollution
Control Loan Program to provide financial assistance for
eligible projects, including those that encourage green
infrastructure, that manage and treat storm water, and that
maintain and restore natural hydrology by infiltrating,
evapotranspiring, and capturing and using storm water;
(i) that in planning projects for which financing will be
sought from the Water Pollution Control Loan Program,
municipalities may benefit from efforts to consider a project's
lifetime costs; the availability of long-term funding for the
construction, operation, maintenance, and replacement of the
project; the resilience of the project to the effects of
climate change; the project's ability to increase water
efficiency; the capacity of the project to restore natural
hydrology or to preserve or restore landscape features; the
cost-effectiveness of the project; and the overall
environmental innovativeness of the project; and
(j) that projects implementing a management program
established under Section 319 of the Federal Water Pollution
Control Act may benefit from the creation of a linked deposit
program that would make loans available at or below market
interest rates through private lenders.
(Source: P.A. 96-8, eff. 4-28-09.)

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(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

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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 treatment works, as defined in
Section 212 of the Federal Water Pollution Control Act,
including, but not limited to, the following: 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; and any other method or system for preventing,
abating, reducing, storing, treating, separating, or disposing
of municipal waste, including storm water runoff, or industrial
waste, including waste in combined storm water and sanitary
sewer systems as those terms are defined in the Federal Water
Pollution Control Act.

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(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, including storm water treatment systems,
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.

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(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, including storm water treatment systems
that are treatment 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

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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, including storm water
treatment systems that are treatment works, and projects
that fulfill federal State Revolving Fund grant
requirements for a green project reserve;
(3.5) to make direct loans, including, but not limited
to, loans through a linked deposit program, 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

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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; and .
(8) notwithstanding any other provision of this
subsection (b), to provide, in accordance with rules
adopted under this Title, any financial assistance that may
be provided under Section 603 of the Federal Water
Pollution Control Act for any projects eligible for
assistance under subsections (c)(1) or (c)(2) of that
Section or federal rules adopted under those subsections.
(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

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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

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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

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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

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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 for the administration of this Title, including,
but not limited to, rules setting to set forth procedures and
criteria concerning loan applications and the issuance of
loans. For loans to units of local government, the regulations
shall include, but need not be limited to, the following
elements:
(1) loan application requirements;

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(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;

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(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) Rules adopted under this Title shall also include, but
shall not be limited to, criteria for prioritizing the issuance
of loans under this Title according to applicant need. 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. Rules for prioritizing loans from the Water
Pollution Control Loan Program may include, but shall not be
limited to, criteria designed to encourage green
infrastructure, water efficiency, environmentally innovative
projects, and nutrient pollution removal.
(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

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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.
(e) The Agency may adopt rules to create a linked deposit
loan program through which loans made pursuant to paragraph
(3.5) of subsection (b) of Section 19.3 may be made through
private lenders. Rules adopted under this subsection (e) shall
include, but shall not be limited to, provisions requiring
private lenders, prior to disbursing loan proceeds through the
linked deposit loan program, to verify that the loan recipients
have been approved by the Agency for financing under paragraph
(3.5) of subsection (b) of Section 19.3.
(Source: P.A. 96-8, eff. 4-28-09.)
Section 99. Effective date. This Act takes effect upon
becoming law.