Federally Assisted Water Revolving Loan

INTEREST RATE:

The standard rate is 3.0% and the non-standard rates are 2% and 1.0% for the period July 1, 2008 to June 30, 2009. To qualify for the 1% hardship rate, the community’s median household income must be below $26,938 (80% of the MHI of the Commonwealth). To qualify for the 2% non-standard rate, the borrower must have a MHI between $33,672 and $26,937 (80% of the State MHI) or be considered regional, or the project must assist the system to achieve compliance with an order or judgment addressing environmental noncompliance.

REPAYMENT PERIOD:

Within 20 years of project completion commencing within one year of initiation of operation. Thirty-year terms may be available for disadvantaged communities.

FINANCING EXPENSES:

None

LOAN SERVICE FEE:

A fee of 0.25% of the unpaid loan balance paid annually.

LOAN PAYMENT FREQUENCY:

Semi-annually each June 1 and December 1.

REPLACEMENT RESERVE:

Dependent of the useful life of the assets being funded.

ELIGIBILITY:

Governmental agencies, other than federal agencies, for facilities necessary to achieve or maintain compliance with the Safe Drinking Water Act or to protect public health. Borrower must demonstrate financial, managerial, and technical capacity. Project must be included on the project priority list in the Intended Use Plan for the Drinking Water State Revolving Fund loan program.

PRIORITY OF LOAN
AWARDS:

Awards are based on the project ranking on the Drinking Water Project Priority List. Maximum award per year to a Governmental Agency is $4 million.

LOAN APPLICATION
PROCESS:

Upon receipt of the letter of invitation, obtain and file the application document with KIA. After meeting the financial requirements obtain a loan commitment from KIA board. Complete the DOW technical planning requirements, obtain construction bid, adopt adequate user charge rates and execute the Assistance Agreement. Draw loan funds as project expenses are incurred. Finalize loan amount upon essential project completion and confirm repayment schedule.