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  • NJ A3884
  • Appropriates funds to DEP for environmental infrastructure projects for FY2017.
Introduced
(6/20/2016)
In Committee
(6/23/2016)
Crossed Over
(6/27/2016)
Passed
(6/27/2016)
Signed
(8/18/2016)
Dead/Failed/Vetoed
2016-2017 Regular Session
This bill appropriates certain federal and State moneys to the Department of Environmental Protection (DEP) for the purpose of implementing the State Fiscal Year 2017 New Jersey Environmental Infrastructure Financing Program (NJEIFP), which is expected to finance approximately $411.35 million in Storm Sandy and other environmental infrastructure projects for State Fiscal Year 2017. The DEP, working with the New Jersey Environmental Infrastructure Trust (NJEIT), implements the NJEIFP which has completed 29 annual financing cycles and financed over 1,150 projects totaling over $6.35 billion throughout the State. The program has reduced financing costs for project sponsors by approximately 25 - 30 percent. From its inception, the program has reduced financing costs by approximately 30 percent saving borrowers over $2.3 billion. In addition, the program has generated more than 130,000 construction jobs, and stimulated significant improvements to the State's clean water and drinking water infrastructure. Under the bill, for State fiscal year 2017, approximately $295.1 million will be available for clean water project loans and $116 million for drinking water project loans. Funding sources include federal capitalization grants, State bond issue proceeds, State match, various prior legislative appropriations, loan repayments, interest earnings, and market rate loans made by the NJEIT. Of those totals, approximately $170 million will be available for financing Storm Sandy project loans of which approximately 19 percent of each loan will be subject to principal forgiveness. Approximately $140 million will be available for financing Storm Sandy clean water project loans of which approximately $26.6 million will be subject to principal forgiveness. Approximately $30 million will be available for financing Storm Sandy drinking water project loans of which approximately $5.7 million will be subject to principal forgiveness. Funding sources include the Federal Disaster Relief Appropriations Act, State match, and market rate loans made by the NJEIT. Approximately $3 million will be available for Combined Sewer Overflow Abatement (CSO) projects with a focus on green technology (e.g., green roofs, rain gardens, porous pavement, and other activities that maintain and restore natural hydrology) and reserving $500,000 from the CSO reserve for long-term integrated water resource planning. Principal forgiveness will be available to the highest ranked CSO projects and will be awarded according to the DEP's ranking methodology based on projects' relative water quality benefit in conjunction with project readiness. Total principal forgiveness for each CSO Green Project sponsor will be limited to $1 million, not including projects that have not secured long-term financing in fiscal year 2016 but receive interim financing prior to June 30, 2016. Approximately $3 million will be available for principal forgiveness loans for stormwater runoff mitigation environmental infrastructure projects in the Barnegat Bay Watershed to continue addressing the critical water quality issues confronting this waterbody, of which 50 percent will be subject to principal forgiveness. Approximately 10 percent of the State's clean water capitalization grant and 20 percent of the State's drinking water capitalization grant will be used as a green project reserve as may be required in the 2016 federal appropriation. Approximately $60 million is available for loans to eligible redevelopment projects. Any additional clean water principal forgiveness loans permitted in the federal appropriation will be available for CSO abatement projects and Barnegat Bay Watershed projects as described above. If drinking water principal forgiveness loans are permitted, the State is prepared to dedicate up to 30 percent of its state drinking water capitalization grant for such projects. Drinking water loans for improvements to water supply systems serving populations of up to 500 people will be in an amount not to exceed $500,000 wherein each loan shall consist of a 100 percent DEP principal forgiveness loan. Unexpended funds plus up to 15 percent of the State's drinking water capitalization grant will be available for systems serving populations up to 10,000 people wherein each loan shall consist of a 50 percent DEP principal forgiveness loan. The unexpended balance of the 30% of the State's drinking water capitalization grant set aside for principal forgiveness will be available to municipally-owned water systems needing treatment for a primary national or State drinking water contaminant wherein each loan would consist of a 20 percent DEP principal forgiveness loan, 40 percent DEP interest free loan and 40 percent NJEIT market rate loan. Disaster Relief Emergency Financing Program loans will continue to be available for short-term financing (up to three full fiscal years) for projects to repair or improve the resiliency of environmental infrastructure systems adversely impacted by Storm Sandy. The source of funds for such loans is currently repayments of prior NJEIFP Loans and NJEIT operating funds but private bank financing for such loans may be used as the need arises. Finally, Interim Financing Program (IFP) Loans will be available for projects approved to receive long-term financing. IFP loans will be available upon the DEP's issuance of an authorization to award a project's final construction contract, project certification by the DEP, and satisfaction of financial eligibility requirements. The loans will finance costs disbursed prior to long-term financing. The source of funds for such loans include prior capitalization grants, NJEIFP loan repayments, prior State bond acts, and interest earnings thereon. The bill appropriates to the DEP moneys from: (1) the "Clean Water State Revolving Fund" established pursuant to section 1 of P.L.2009, c.77, in an amount equal to the federal fiscal year 2016 capitalization grant made available to the State pursuant to the Federal Clean Water Act for clean water project loans; (2) the "Interim Financing Program Fund" created and established by the NJEIT pursuant to subsection d. of section 9 of P.L.1985, c.334 (C.58:11B-9), in such amounts as may be necessary to supplement the sums appropriated from the Clean Water State Revolving Fund for clean water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State pursuant to the Federal Clean Water Act; (3) the "Drinking Water State Revolving Fund" established pursuant to section 1 of P.L.1998, c.84, in an amount equal to the federal fiscal year 2016 capitalization grant made available to the State pursuant to the Federal Safe Drinking Water Act for drinking water projects; (4) the "Wastewater Treatment Fund" established pursuant to section 15 of the "Wastewater Treatment Bond Act of 1985" (P.L.1985, c.329), in amounts constituting the unappropriated balances therefrom for clean water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State pursuant to the Federal Clean Water Act for clean water projects; and (5) the "Clean Water State Revolving Fund" established pursuant to section 1 of P.L.2009, c.77, in amounts constituting any repayments of loans and interest therefrom for clean water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State pursuant to the Federal Clean Water Act for clean water projects. The bill authorizes the DEP to transfer from the Clean Water State Revolving Fund to the Drinking Water State Revolving Fund an amount up to the maximum amount authorized to be transferred pursuant to the Federal Safe Drinking Water Act to meet present and future needs for the financing of eligible drinking water projects, and appropriates an amount equal to this maximum amount to the DEP for those purposes. The bill further appropriates to the DEP moneys from: (1) the "1992 Wastewater Treatment Fund" established pursuant to section 27 of the "Green Acres, Clean Water, Farmland and Historic Preservation Bond Act of 1992" (P.L.1992, c.88), in amounts constituting the unappropriated balances therefrom for the purposes of clean water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for clean water projects pursuant to the Federal Clean Water Act; (2) the "2003 Water Resources and Wastewater Treatment Fund" established pursuant to subsection a. of section 19 of the "Dam, Lake, Stream, Flood Control, Water Resources, and Wastewater Treatment Project Bond Act of 2003" (P.L.2003, c.162), in amounts constituting the unappropriated balances therefrom for the purposes of clean water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for clean water projects pursuant to the Federal Clean Water Act; (3) the "Drinking Water State Revolving Fund" in amounts constituting the unappropriated balances therefrom for the purposes of drinking water project loans; and (4) the "Water Supply Fund" established pursuant to section 14 of the "Water Supply Bond Act of 1981" (P.L.1981, c.261), in such sums as may be or become available on or before June 30, 2017 as repayments of drinking water project loans therefrom for the purposes of drinking water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for drinking water projects pursuant to the Federal Safe Drinking Water Act. The bill authorizes the DEP to transfer from previous appropriations made from the "Water Supply Fund" any unexpended balances and any repayments of loans and interest therefrom in such amounts as needed to the Drinking Water State Revolving Fund for the purposes of drinking water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for drinking water projects pursuant to the Federal Safe Drinking Water Act. The bill authorizes the DEP to transfer from previous appropriations made from the "1992 Wastewater Treatment Fund" any unexpended balances and any repayments of loans and interest therefrom in such amounts as needed to the Clean Water State Revolving Fund Accounts for the purposes of clean water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for clean water projects pursuant to the Federal Clean Water Act. The bill authorizes the DEP to transfer from an appropriation made from the "2003 Water Resources and Wastewater Treatment Fund" pursuant to P.L.2004, c.109 and P.L.2007, c.139 any unexpended balances and any repayments of loans and interest therefrom in such amounts as needed to the Clean Water State Revolving Fund Accounts for the purposes of clean water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for clean water projects pursuant to the Federal Clean Water Act. The bill appropriates to the DEP moneys from the sums deposited by the Trust into the "Wastewater Treatment Fund," the "1992 Wastewater Treatment Fund," the "Water Supply Fund," the "Stormwater Management and Combined Sewer Overflow Abatement Fund," the "2003 Water Resources and Wastewater Treatment Fund," the "Clean Water State Revolving Fund" and the "Drinking Water State Revolving Fund," as appropriate, for the purposes of clean water project loans and drinking water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for clean water projects pursuant to the Federal Clean Water Act and drinking water projects pursuant to the Federal Safe Drinking Water Act. The bill appropriates to the DEP sums as may be received by the Department of Community Affairs as the grantee from the United States Department of Housing and Urban Development Community Development Block Grant - Disaster Recovery Program (CDBG-DR), for the purposes of CDBG-DR eligible clean water and drinking water project loans and providing the State match as required or will be required for the award of the capitalization grants made available to the State for clean water projects pursuant to the Federal Clean Water Act and Federal Safe Drinking Water Act, respectively. The DEP would use the funds appropriated under this bill to make zero interest loans to local governments and privately-owned water companies (project sponsors) for between 25% and 75% of project costs totaling (1) $287.8 million for new clean water projects included in the "Storm Sandy and State Fiscal Year 2017 Clean Water Project Eligibility List," and $7.3 million for clean water projects through supplemental zero interest loans to project sponsors that had previously received a loan subject to the availability of funds; and (2) $113.45 million for new drinking water projects included in the "Storm Sandy and State Fiscal Year 2017 Drinking Water Project Eligibility List," and $2.8 million for drinking water projects through supplemental zero interest loans to project sponsors that had previously received a loan subject to the availability of funds. The supplemental loans constitute the difference between the allowable loan amount required by the project and the loan amount certified by the Commissioner of Environmental Protection in State Fiscal Year 2017. The bill authorizes the DEP to issue loans up to 100% of the total allowable loan amount (1) for clean water loans to municipalities that do not satisfy the New Jersey Environmental Infrastructure Trust credit policy but are subject to State financial supervision and oversight pursuant to the "Local Government Supervision Act (1947)," P.L.1947, c.151 (C.52:27BB-1 et seq.), (2) for clean water and drinking water loans to municipalities receiving funding under the United States Department of Housing and Urban Development Community Development Block Grant - Disaster Recovery Program (CDBG-DR); (3) for loans to drinking water systems serving 500 or fewer residents the Department of Environmental Protection allowable loan amount shall be 100% of the total allowable loan amount not to exceed a total of $500,000 for all such loans; and (4) for loans to communities in a combined sewer overflow "CSO" sewershed sponsoring construction projects that reduce or eliminate excessive infiltration/inflow or extraneous flows. A companion bill, Senate Bill No. 2292 of 2016 and Assembly Bill No. 3883 of 2016, would authorize the NJEIT to make market rate loans to local governments and privately-owned water companies (project sponsors) for between 25% and 75% of project costs totaling (1) $287.8 million for 44 new clean water projects included in the "Storm Sandy and State Fiscal Year 2017 Clean Water Project Eligibility List," and $7.3 million for six clean water projects through supplemental zero interest loans to project sponsors that had previously received a loan subject to the availability of funds; and (2) $113.45 million for 36 new drinking water projects included in the "Storm Sandy and State Fiscal Year 2017 Drinking Water Project Eligibility List," and $2.8 million for two drinking water projects through supplemental zero interest loans to project sponsors that had previously received a loan subject to the availability of funds. Under this bill, in conjunction with Senate Bill No. 2292 of 2016 and Assembly Bill No. 3883 of 2016, the Storm Sandy and State Fiscal Year 2017 New Jersey Environmental Infrastructure Financing Program would finance $411.35 million in environmental infrastructure projects for State Fiscal Year 2017 subject to the availability of funds.
2nd Reading in the Assembly, Bills and Joint Resolutions Signed by the Governor, Budget, Passed Assembly, Passed both Houses
Approved P.L.2016, c.32.  (on 8/18/2016)
 
 

Date Chamber Action Description
8/18/2016 S Approved P.L.2016, c.32.
6/27/2016 S Passed Senate (Passed Both Houses) (39-0)
6/27/2016 S Substituted for S2293 (1R)
6/27/2016 S Received in the Senate without Reference, 2nd Reading
6/27/2016 A Passed by the Assembly (77-0-0)
6/23/2016 A Reported out of Assembly Committee, 2nd Reading
6/23/2016 Assembly Budget Hearing (10:00 6/23/2016 Committee Room 11, 4th Floor)
6/20/2016 A Introduced, Referred to Assembly Budget Committee
Date Motion Yea Nay Other
Detail 6/27/2016 Senate Floor: Third Reading - Final Passage 39 0 1
Detail 6/27/2016 Assembly Floor: Third Reading - Final Passage 77 0 3
Detail 6/27/2016 Senate Floor: Substitute For S2293 (Voice Vote) 0 0 0
Detail 6/23/2016 Assembly Budget Committee: Reported Favorably 13 0 0