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HomeMy WebLinkAboutApplication - DEQ Funds - Wastewater Systems.?'‘yTES Deschutes County Board of Commissioners 1300 NW Wall St., Suite 200, Bend, OR 97701 -1960 (541) 388 -6570 - Fax (541) 385 -3202 - www.deschutes.org AGENDA REQUEST & STAFF REPORT For Board Business Meeting of March 11, 2009 Please see directions for completing this document on the next page. DATE: March 9, 2009 FROM: Barbara Rich CDD x4713 TITLE OF AGENDA ITEM: Consideration of Vice Chair signature of Document 2009 -138, an application for Clean Water Stal Revolving Funds to capitalize the financial assistance program for onsite system upgrades for soul aern Deschutes County. PUBLIC HEARING ON THIS DATE? No BACKGROUND AND POLICY IMPLICATIONS: The Board has stated that providing financial assistance for homeowners upgrading their onsite wastewater treatment systems is a priority. The federal government has provided increased funding for Oregon's Clean Water State Revolving Fund as part of the national stimulus bill. Oregon anticipz tes receiving about $44 million in additional funds as part of the stimulus bill. Twenty percent of these funds, or $8.8 million, are targeted towards innovative projects that include green infrastructure. Upgrading onsite wastewater treatment systems is considered an innovative project because it do not take the conventional approach of creating or extending centralized sewer systems to provide adN anced wastewater treatment options. In addition, the approach is considered green infrastructure becau ie it does not invest large amounts of financial resources or construction materials in transporting wastewater from location to location. The application deadline for this program is March 16, 2009. FISCAL IMPLICATIONS: This program would include receiving both grant and loan funds from the CWSRF program. Fi ;cal implications include program management in terms of reporting requirements to DEQ and man:.ging the County's financial assistance program. Program administration is an allowable expense for .rse of CWSRF funds. RECOMMENDATION & ACTION REQUESTED: Consider siganture of the application form for the CWSRF program. ATTENDANCE: Barbara Rich DISTRIBUTION OF DOCUMENTS: Barbara Rich, need signed copy immediately as the application deadline is March 16, 2009. DEQ State of Oregon Department of Environmental Quality CLEAN WATER STATE REVOLVING FUND PROGRAM LOCAL COMMUNITY LOAN APPLICATION SECTION 1: PROGRAM DESCRIPTION 1. Deschutes County Community Development 2. Barbara Rich Public Agency /Legal Applicant Program Contact Person 117 NW Lafayette Ave Address 541 - 617 -4713 Phone number 541 - 385 -1764 Bend BarbaraR @co.deschutes.or.us Fax number City Email Address 541 - 388 -6575 541 - 385 -1764 Phone Fax Email address 3. CWSRF Loan Request $ 5,000,000 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application 4. Loan Program Description: (Briefly describe the water quality or health issue(s) intended to be addressed, how this proposed loan program will address these issues, the major loan program components, the goal(s) of the program, the geographic area anticipated to be served by this program and any other pertinent information that explains this program.) Additionally, DEQ requires applicants for this loan to complete the document "Description of the Components of a Proposed Local Community Loan Program" and submit it to DEQ prior to finalizing a Local Community Loan. Contact your local CWSRF Project Officer for clarification. see attached REVISED: 2/20/09 PAGE 2 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application 5. Total Estimated Program Cost $ s,0oo,000 - see attachment A (If there are other anticipated sources of funding for this loan program, please indicate those amounts and the r funding sources in Table B in item # 30) . 6. Program Categories: Estimate the percentage of the proposed CWSRF loan expected to be used for each of the appropriate categories shown below (this information is used for DEQ reporting purposes only). PROJECT CATEGORY % of CWSRF Program VII -A AGRICULTURE — CROPLAND e, (examples: conservation tillage, 9 nutrient management, irrigation improvements) VII -B AGRICULTURE — ANIMALS (examples: animal waste storage, animal waste management, composting facilities) VII -C SILVICULTURE (streamside buffers, revegetation) VII -D URBAN (erosion and sediment control, wet ponds, onsite repairs /replacements, swales,) 60% VII -E GROUND WATER 40% VII -F MARINAS VII -H BROWNFIELDS VII -I STORAGE TANKS VII -J SANITARY LANDFILLS VII -K HYDROMODIFICATIONS (examples: conservation easements, swales, wetland development, shore erosion control) Estuary ACTIVITIES identified in a federally designated Estuary's CCMP OTHER TOTAL 100% REVISED: 2/20/09 PAGE;. Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application SECTION 2: WATER BODY 7. What water body, if any, will the program impact? (Provide the name of the water body, the watershed where it is located -- indicate the fourth and fifth field hydrologic unit codes (HUCs) - - and the geographic area that will be impacted by this program. If the program will primarily impact groundwater, explain the connection between this program and the groundwater. Indicate the location where this program actually impacts groundwater. If the program is expected to impact multiple water bodies, indicate which sub - basins are expected to be involved. ) see Attachment A 8. Is this water body(s) impaired or water quality limited for a pollutant(s) that will be reduced or eliminated by this loan program? RI Yes ❑ No If yes, explain in detail how each pollutant(s) will be addressed. see Attachment A REVISED: 2/20/09 PAGE 4 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application 9. Will this program improve water quality by mitigating any of the following water quality parameters: temperature *, dissolved oxygen *, contaminated sediments, bacteria, nutrients or any toxics on EPA's priority pollutant list (see List A for a list of EPA's toxics)? © Yes ❑ No ( *Temperature is considered a pollutant when water temperature increases to the point where it irrlpacts aquatic species. Dissolved oxygen is considered a pollutant when the level falls outside a range that benefits the ecological health of the waterbody) If yes please describe the intended level of mitigation of all pollutants on an attached sheet and submit as Attachment A. Also indicate if a pollutant being mitigated by this program is a pollutant causing this waterbody to be listed on DEQ's 303(d) listing. 10. If the water body(s) impacted by this program qualifies as a DEQ "Special Status" water body, indicate which category it qualifies through: (see List B for a description of these categories comprising CWSRF "special status" waterbodies) Federally designated Wild and Scenic Rivers State scenic waterways ❑ Federally designated Sole Source Aquifers ❑ Lower Columbia River Estuary (National Estuary Program designated) ❑ The federally designated Tillamook Bay (National Estuary Program designated) ❑ The sub - basins of the Three Basin Rule (Clackamas, North Santiam and McKenzie rivers) ❑ Significant wetlands or riparian areas identified by local governments and listed within local planning documents SECTION 3: WATER QUALITY /PUBLIC HEALTH BENEFITS 11. Will the program address a noncompliance issue with (a) water quality standards; or (b) a public health issue associated with a surface water? ® Yes ❑ No If yes, describe below how this noncompliance issue will be addressed and include the source of documentation (sanitary survey, ambient sampling, groundwater tests, TMDL, other). REVISED: 2/20/09 PAGE 5 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application (a) Water quality standards: see Attachment A Source of documentation: DEQ's Water Quality Index for the Deschutes River, USGS Scientific Investigations Report 2007 -5237 (b) Public health issue: None identified Source of documentation Attach copies of documentation (as Attachment B) or identify where documentation can be found in DEQ records. http://www.deq.state.or.us/lab/wqm/wqindex/deshood3.htm http://pubs.usgs.gov/sir/2007/5237/ 12. Will the program address a noncompliance issue with (a) water quality standards or (b) public health issue related to groundwater? ® Yes ❑ No If yes, describe below how this noncompliance issue will be impacted by the proposed loan program. see Attachment A REVISED: 2/20/09 PAGE 6 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application Source of documentation: USGS Scientific Investigations Report 2007 -5237 13. Does this program resolve a noncompliance issue or an enforcement action? ❑ Yes ICJ No If yes, indicate which of the following enforcement activities or water quality violations have occurred in relation to the water quality problem or public health issue which this program will address. Check all that applies and attach copies (as Attachment, C) of documentation of noncompliance or enforcement action if available. Court Orders Environmental Quality Commission (EQC) Orders Other Department Orders Mutual Agreements and Orders (MAO) EQC rules requiring elimination of a specific water quality problem Noncompliance with the Department's statutes, rules or water quality standards An approved TMDL Storm water Management Plan Existing potential water quality problem otherwise noted by the Department Documented health hazards with associated documented water quality problem Documented health hazards without documented water quality problem Other (describe) 14. Explain how this loan program will satisfies the enforcement action or resolve noncompliance. i NA REVISED: 2/20/09 PAGE 7 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application 15. Will this program ensure that an existing water quality related activity, currently in compliance, will remain in compliance? o Yes ® No If yes, explain the existing circumstances and how this program will support ongoing compliance. The •ro•osal will work with the existin• re•ulator s stem that ensures that •ermits issued for onsite wastewater treatment systems meet the minimum reauirements of DEQ rule. Further this proposal will assist homeowners seeking to install onsite systems that provide additional water quality protection in the form of nitrogen- reduction rior to dischar ins effluent to • ro ndwater. Over how long of a time period (in years) will this activitiy reasonably extend and maintain compliance for this activity? indefinite years 16. Will the program improve or sustain aquatic habitat supporting state and /or federal threatened or endangered aquatic species? ® Yes ❑ No If yes, describe how this program will impact such habitat (Indicate which species and habitat will be impacted. Indicate the value of this habitat to the species. Indicate how effective this program will be in improving or sustaining this habitat.) Reducing nitrogen inputs to nitrogen- limited streams of the upper Deschutes Watershed will reduce the effects of human - caused eutrophication. The upper Deschutes is listed habitat for Bull Trout and Steelhead. 17. Will this program incorporate a process that conserves or in some manner reduces water use? ❑ Yes © No If yes, describe the process in detail. REVISED: 2/20/09 PAGE 8 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application 18. Does this projgram support the implementation of: (1) A TMDL through a Water Quality Implementation Plan? ❑ Yes o No (2) A Groundwater Management Area through a Groundwater Management Area Action Plan? ❑ Yes im No If yes, explain in detail how this proposed program supports such implementation. There is neither a TMDL or GWMA established for this region. 19. Does the program address water quality standards or public health issues related to Persistent Bioaccumulative Toxics (PBTs) (see List C for listing)? ❑ YES KI NO If yes, list which PBTs and briefly describe how this program will mitigate each of these on a separate sheet of paper (Attachment D). 20. If the proposed program is not implemented at this time, are water quality standards likely to be exceeded, or are existing exceedances of the standards likely to worsen? © Yes ❑ No If yes describe why. Monitoring conducted by the Oregon DEQ and the USGS indicate that the existing groundwater contamination is caused by conventional onsite wastewater treatment systems. If these systems are not upgraded or otherwise remove( from service, the aroundwater will continue to exceed Oregon's groundwater quality standards. REVISED: 2/20/09 PAGE 9 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application Give a best estimate of when WQ standards will be exceeded or likely to worsen: ❑ 1 - 3 years; ❑ 3 — 5 years; ❑ more than 5 years Comments Existing monitoring data show that the groundwater below conventional onsite systems currently exceeds Oregon's groundwater quality action level on average. 21. If the proposed program is not implemented at this time, is the resulting impact likely to cause a public health problem? ® Yes ❑ No If yes describe how and to what extent the impact might cause a public health problem. Most s roundwater contamination is currentl limited to the u. . er • ortions of the a q uifer with 24% of drinkin • water wells sampled in 2000 exceeding background levels and 5% of those wells exceeding the Oregon action level of 7 mq /L nitrate as N. Over time, as the pollution in the upper portions moves down and through the aquifer, more drinking water wells will show impacts. The US Environmental Protection Agency established a Safe Drinking Water Act standard for nitrate as 10 mg /L nitrate as N. If the proposed program is not implemented, corrective action will be slowed or delayed until the land development industry recovers from the current recession. 22. If the community does not proceed with this program now, will this same opportunity be available in the future? ❑ Yes ® No If no, clearly explain what factors or conditions currently allow this program, but may not be available in the future. (These rnight include necessary land being available, time sensitive construction work or other financial considerations that require the project to be implemented now) see Attachment A REVISED: 2/20/09 PAGE 10 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application SECTION 4: INVOLVEMENT AND TECHNOLOGY 23. Describe in detail any educational or outreach components incorporated into the program. ❑ NA The County expects to produce public information materials and resources includviq both printed and electronic materials to advertise the financial assistance program as broadly as possible. The Count has an established track record of being able to distribute information widely in coordination with area news media. Examples of public outreach materials and media coverage of another county program are available at: www.deschutes.org /cdd /gpp/ under the link to "Project News" at the right. In addition, the County has established mechanisms for direct mailing information to property owners. 24. Will the program incorporate innovative technologies? o Yes ❑ No If yes, please describe those technologies and explain why they are innovative. In this program, the county proposes to use innovative onsite wastewater treatment systems to replace conventional onsite systems and instead of the conventional approach of installing centralized sewers to correct a pollution problei i. This approach is innovative not only because of the technology involved but also because corrective action can begin immediately as opposed to waiting a significant period of time for sewer feasibility, engineering & design, and financial planning studies, and then construction and connection to be complete. A recent project to expand an existing sewer system in the region took seven years from the decision to proceed to the time when the first new connection was ma.ie. In addition the approach is innovative because it is a pay -as- you -qo approach rather than having to have the full amount 25. Will this program include an innovative technology and is it transferable to other public agencies? o Yes ❑ No ❑ NA If yes, explain that transferability and the types of communities who might also benefit from this technology. The experience and information gained by using innovative onsite systems for thisproject is easily translated and transferred to other jurisdictions and agencies. For example, municipalities facing difficulties expanding their existing centralized treatment plant capacity could diversify their treatment options by incorporating decentralized (including onsite systems) approaches into their wastewater management plans. In addition, other jurisdictions facing similar water pollution problems would be able to easily identify the types of innovative onsite systems that would help them solve their water quality issues. 26. Are there other organizations assisting with this proposed program, (this includes supplemental funding or in -kind support/self -help from the local community). in Yes ❑ No REVISED: 2/20/09 PAGE 11 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application If yes, describe the type of assistance and which offices will provide what type of assistance. Deschutes County expects to partner with a local housing rehabilitation program for technical assistance in working with homeowners upgrading their systems and for administrative assistance with issuing individual loans. The housing rehabilitation organization in Deschutes County is Neighborlmpact, a non - profit organization that works with income - limited households to perform housinq_upgrades, which include onsite system repairs or upgrades. This organization currently holds a list of persons from southern Deschutes County that have contacted them about funds available to help with onsite system upgrades. The County expects to work with Neighborlmpact to use their existing loan review and administration procedures to target funds to southern Deschutes County. 27. What level of monitoring, reporting or adaptive management is incorporated within this program,? Please describe (include only additional monitoring of water quality improvements beyond what is required by existing regulations). ❑ NA see Attachment A 28. Does the program address risk management or include tangible security /safety measures? ® Yes ❑ No If yes, describe. See Attachment A SECTION 5: PROGRAM SCHEDULE AND BUDGETING REVISED: 2/20/09 PAGE 12 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application 29. Program Schedule: Estimated start date Estimated program conclusion date 30. Program Costs and Funding: Immediately, see Attachmer November 2029 TABLE A. PROGRAM BUDGET: TOTAL PROGRAM BUDGET CWSRF LOAN FUNDED COSTS ADMINISTRATION AND LEGAL 1,000,000 500,000 MARKETING 475,000 50,000 PROJECT INSPECTION 1,515,000 390,000 CONSTRUCTION 4,716,250 4,020,000 EQUIPMENT SECTION 319 GRANT MATERIALS /SUPPLIES 20,000 20,000 OTHER: 1,270,000 20,000 TOTAL COSTS 13,016,250 5,000,000 TABLE B. FUNDING SOURCES: FUNDING CLEAN WATER STATE REVOLVING FUND (CWSRF) LOAN $5,000,000 COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) USDA/ RURAL DEVELOPMENT (RD) GRANT and /or LOAN WATER/WASTEWATER GRANT and /or LOAN SPECIAL PUBLIC WORKS GRANT and /or LOAN OREGON WATERSHED ENHANCEMENT BOARD FUNDS GENERAL OBLIGATION BONDS SECTION 319 GRANT REVENUE BONDS LOCAL FUNDS (note source of funds) IN -KIND ASSISTANCE OTHER: $8,016,250 TOTAL FUNDING $13,016,250 31. Estimated CWSRF Loan Disbursement Schedule: REVISED: 2/20/09 PAGE Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application AMOUNT AMOUNT 1/1/09- 3/31/09 AttachmentA 10/1/10 - 12/31/10 4/1/09-6/30/09 1/1/11-3/31/11 $1,000,000 7/1/09-9/30/09 $1,000,000 4/1/11-6/30/11 10/1/09-12/31/09 7/1/11-9/30/11 1/1/10- 3/31 /10 $1,000,000 10/1/11-12/31/11 4/1/10 - 6/30/10 1/1/12 -and later $2,000,000 7/1/10- 9/30/10 TOTAL LOAN $5,000,000 32. Loan Structure (DEQ and borrower): X Revenue - Secured Loan - Coverage Factor and Reserve Pair: Debt Service Coverage Factor 105% / Loan Reserve Percentage 100% General Obligation (G.O.) Bonds - Date of voter approval: Rated Revenue Bonds F-1 Alternative Loan n Discretionary Loan SECTION 6: SUPPORTING DOCUMENTS AND CERTIFICATION Description of the Components of a Proposed Local Community Loan Program DEQ wants to support local communities in establishing local loan programs to address water quality needs. Establishing and implementing a local loan program requires considerable planning and discussion. In order for DEQ to understand and approve of such loan programs, the department requires applicants to submit a thorough description of the proposed loan program. DEQ will review this description and work with a community in finalizing the necessary details of the program before approving a Local Community Loan. An outline suggesting components to be described is located on the CWSRF web site. http: / /www.deq,state.or.us /wo /loans /docs /srfforms /apps /Iclprojdesc.pdf Projected Program Cash Flow Document REVISED: 2/20/09 PAGE 14 Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application This document is intended to ensure the applicant has realistically assessed the financial viability of implementing a Local Community Loan program. The projected cash flow (based on the program description) will address initial start up costs, the community's administration costs, the timing of DEQ disbursements, the amount and number of anticipated local loans over the program, the timing of repayments back to the local community and to the department. DEQ does not provide a form for this document. Exhibits. There are a number of supporting documents that, when applicable, are required to be submitted to DEQ along with the CWSRF Application in order for the program to be considered for a loan. These documents will have to be submitted prior to receiving loan approval. They may include: Audited financial statements Current copy of approved budget A land use compatibility statement Pre -award Compliance Review Report An approved project planning document Environmental review document Inter - Agency agreement For further information about these exhibits, review DEQ's "Checklist of Application Exhibits and Requirements for Local Community Loans, it and the Program Description form are available at: http: / /www.deq.state.or.us /wq /loans /apps.htm. under "local community loan" or contact your local CWSRF project officer (listed below). Authorization: THE PUBLIC AGENCY /APPLICANT CERTIFIES THAT the Applicant will use Clean Water State Revolving Fund loan proceeds only for the program described in this application and in the Program Description document. It will comply with all applicable rules and laws. The applicant will obtain all applicable local, state, and federal permits, approvals, and licenses; and comply with their terms and conditions. The undersigned is duly authorized to request this loan on behalf of the Public Agency /Applicant. The Applicant declares under penalty of law that all facts given and information attached are true and correct. The Applicant authorizes DEQ to verify all information. Authorized Signature: Date: Typed Nance and Title: LGIP Account Number (for processing of loan disbursements): 4168 REVISED: 2/20/09 PAGE 1; Oregon Department of Environmental Quality CWSRF Loan Program Local Community Loan Application Return the completed application to your DEQ Project Officer: EASTERN REGION: SHANNA OLSON (541) 278 -8681 700 S.E. Emigrant, Suite 330 Pendleton, OR 97801 NORTHWEST REGION: RICHARD SANTNER (503) 229 -5219 2020 S.W. 4th Avenue, Suite 400 Portland, Oregon 97201 -5884 WESTERN REGION: JAIME ISAZA (541) 687 -7341 1102 Lincoln Street, Suite 210 Eugene, Oregon 97401 BOB HABERMAN (541) 687 -7359 1102 Lincoln Street, Suite 210 Eugene, Oregon 97401 If you have other questions regarding the Clean Water State Revolving Fund program, please call: LARRY MCALLISTER (503) 229 -6412 KIM CARLSON (503) 229 -6312 RICK WATTERS (503) 229 -6814 FAX: (503) 229 -6037 Clean Water State Revolving Fund (CWSRF) Program Water Quality Division Oregon Department of Environmental Quality 811 S.W. Sixth Avenue Portland, Oregon 97204 -1390 REVISED: 2/20/09 PAGE 16 Attachment A: Deschutes County Local Community Loan Application Responses 1. Loan Program Description: Groundwater studies conducted by the US Geological Survey and the Oregon Department of Environmental Quality have shown that the sole source of drinking water for the southern Deschutes County region is becoming contaminated by continued use of conventional onsite wastewater treatment systems (onsite systems, formerly called septic systems). Nitrate levels in groundwater beneath conventional onsite systems averaged 11 mg /L nitrate as N with maximum levels reaching 52 mg /L as measured during a three year period following installation of new systems. Oregon rules establish an action level for groundwater management areas at 7 mg /L nitrate as N. In addition, the Oregon DEQ studied the effectiveness of innovative onsite wastewater treatment systems that reduce nitrogen and other pollutants that are discharged to groundwater. Several systems were identified as effective for protecting groundwater quality. USGS modeling of the aquifer specifically used the treatment capabilities of these innovative onsite systems determined that innovative onsite systems at different levels of performance would provide an effective alternative to sewer systems. (USGS Scientific Investigations Report 2007 -5237) The south Deschutes County region contains about 6,400 conventional onsite systems that are contributing to the groundwater pollution issue. A sewer feasibility study completed in 1997 estimated that it would cost about $200 million to sewer the region (not including the cost of establishing a sewer district and other land use related actions). Estimates to upgrade existing onsite systems with more protective systems range between $43 and $65 million based on currently available costs. The County owns assets, primarily in the form of developable land that is assessed at about $30 million. However, these assets can only be realized when development activity in the region increases following the current recession. US Census information characterizes the need for financial assistance in the region. Information from the 2000 census indicates that over 12% of the population (about 770 households) has an income level below the poverty level and 18% of the population (about 1,150 households) is 65 or older and most of the latter group lives on a fixed income where absorbing additional expenses would be a significant burden. Given the current elevated unemployment rate in the region, these numbers are likely a conservative estimate of the need. The County proposes to use CWSRF funds targeted at small communities to fund a financial assistance program that includes both loan and grant elements. The County requests $5,000,000 in the proportion of 25 %/75% loan /grant to provide financial assistance to a population of approximately 1,660. This population represents about 10% of the total population of persons served by onsite systems in southern Deschutes County and this request represents between 8 and 12% of the total cost to upgrade existing onsite systems in the region. As a note, the nature of this program allows for funding flexibility in that if the full requested amount is not available because of competing priorities, the program can still move forward with partial funding, for example, with $3,000,000 instead of $5,000,000. This proposal would use SRF resources to create a solid foundation to a financial assistance program for homeowners upgrading their onsite wastewater treatment systems to protect water quality. Deschutes County proposes to provide a combination of loans and partial to full grants to offset the cost of upgrading individual onsite systems. Attachment A: Deschutes County Local Community Loan Application Page 1 The program would build on work already underway at the County level to create financial assistance for homeowners. An existing program initiated by the County provides a $3,750 grant to homeowners upgrading their system, however, this program is funded by the proceeds gained from the development of dedicated land, and development of this land has nearly halted because of the current recession. In addition, the County has a small fund (about $360,000) with which to provide low interest loans to homeowners upgrading systems. However, the reach of this program is limited in that only about 36 homeowners (0.5% of the targeted population) would benefit from the first round of loans. The County is further proposing to provide a variety of loan products ranging from relatively short -term loans with monthly repayment schedules to long -term, payment- deferred loans or outright grants in order to be able to serve the spectrum of the region's need. To ensure the program's long -term success, the County proposes an adaptive management component to measure success and make programmatic changes. In addition, in an innovative approach to maintenance, the county proposes to provide an Operation & Maintenance (O &M) Circuit Rider to provide maintenance service to onsite systems serving low- income households. The County expects this program to "hit the ground running" because there are currently 13 homeowners on the waiting list for the small grants program and Neighbhorlmpact has a list of 6 -8 homeowners that have contacted that program seeking funds to upgrade systems. 5. Total Estimated Program Cost: Deschutes County requests $5,000,000 to fund this project, however, the because of the decentralized approach to wastewater treatment used in this program, the program can still make significant progress even if a lesser amount is awarded. 7. What water body, if any, will the program impact? While there are not direct discharges currently existing or planned to the upper Deschutes, Little Deschutes, Fall or Spring Rivers or Paulina Creek, USGS studies have shown that the upper Deschutes River system is groundwater dominated, in other words, the majority of stream flow is provided via groundwater discharges to streams. Therefore, because the focus of this program is groundwater protection, the effect of the program will be to also protect surface water quality. 8. Is this water body(s) impaired or water quality limited for a pollutant(s) that will be reduced or eliminated by this loan program? Yes. The upper Deschutes is on the Oregon 303(d) list of impaired water bodies for dissolved oxygen and chlorophyll a. Increased levels of wastewater treatment to reduce biochemical oxygen demand and nitrogen will reduce the pollutant load carried by groundwater to the surface waters of the region. The streams of the upper Deschutes watershed are nitrogen - limited, which means that even small increases in nitrogen discharged to the streams will increase primary production (example, algae growth), which results in changes in dissolved oxygen levels in streams. 9. Level of mitigation of all pollutants: Groundwater study and use of the Nitrate Loading Management Model developed by the US Geological Survey estimates that nitrogen loading to streams in the region will be reduced by about 98% if conventional onsite systems are upgraded to nitrogen reducing systems. Because the streams in the Attachment A: Deschutes County Local Community Loan Application Page 2 region are nitrogen limited, significant reductions in nitrogen loading to streams could have a significant positive impact on surface water quality. 11. (a) Water quality standards: The upper Deschutes is on the list of impaired water bodies for dissolved oxygen. Groundwater water investigations combined with intensive groundwater and pollution management modeling by the US Geological Survey has determined that implementing specific performance standards for residential wastewater treatment will reduce nitrogen loading to streams in the region by 98 %. 12. Will the program address a noncompliance issue with (a) water quality standards or (b) public health issue related to groundwater? a. Yes, existing Oregon DEQ monitoring data show that the groundwater impacted by onsite wastewater systems exceeds Oregon's groundwater quality standards contained in OAR 340 -040. Upgrading existing systems to reduce pollutant loading to groundwater will protect and enhance groundwater quality in the region by achieving compliance with the groundwater quality protection action levels. b. Yes, the groundwater underlying the region is the sole source of drinking water for residents. The US Environmental Protection Agency has established a Safe Drinking Water Act standard for nitrate at 10 mg /L nitrate as N. Upgrading onsite systems to reduce nitrogen and other pollutant loading to the aquifer would help ensure private domestic well users are protected to the same level as municipal water supply customers. 22. If the community does not proceed with this program now, will this same opportunity be available in the future? No, the longer the existing onsite systems continue to contribute pollution loading to the aquifer, the more the problem is compounded and the longer and more expensive it becomes to correct. In addition, the County has existing programs either implemented or about to be implemented to provide financial assistance to upgrade existing onsite systems to better protect groundwater quality. However, because of the current recession, the County financial resources are developing sufficiently to capitalize these programs. If there is a significant time lag in obtaining additional funds that will bridge between the current recession and the time when the County's investments will start producing financial resources, the existing technical and administrative capabilities available either on staff or with partner agencies will have to be rebuilt at a later date. Bridging the recession will also help maintain a level of assistance for those homeowners whose systems fail naturally. Historically, the county has issued permits for approximately 100 repairs or upgrades per year in southern Deschutes County. 27. What level of monitoring, reporting or adaptive management is incorporated within this program? The County proposes to establish a long -term monitoring program to help determine the effectiveness of: • the installed onsite system upgrades, Attachment A: Deschutes County Local Community Loan Application Page 3 • the operation and maintenance program for onsite systems, and • the loan /grant program. If needed changes to the program are identified, the pertinent portion of the program will be modified to ensure that the program performs to the highest level possible. Findings from the monitoring program will be reported at least annually in the County's reports on accomplishments and in any form required by the CWSRF. 28. Does the program address risk management or include tangible security /safety measures? The most immediate safety measure of this program will be the overall safety improvements provided as old onsite systems are upgraded, in particular, as steel tanks are replaced. The program embodies other risk management & security /safety measures, particularly as compared to centralized public service facilities. The fact that the treatment systems are dispersed throughout the developed areas means that there is no widespread interruption of service in the event of plant failure. Individual onsite system disruptions result in limited impacts to public health and safety because they are contained to individual properties with no large discharges to public waters. Further, because the systems are located below grade with secure access ports and no surface discharges, public exposure to pollutants or disease causing organisms is controlled. Finally, the County proposes to continue its regulatory oversight role of ensuring that setbacks between domestic wells and onsite system dispersal areas are maintained in accordance with local and /or state rules. 29. Program Schedule: The County proposes to undertake a 20 year program schedule for this loan. 30. Program Costs and Funding: Because the County is proposing to undertake a 20year program, the costs and funding sources have been identified for that period of time in the following spreadsheet. The source of local funds for the program include homeowner loan payments and revenue generated by the development of county -owned land earmarked for the purpose. Attachment A: Deschutes County Local Community Loan Application Page 4 Print Fb FORM Approved By OMB: No. 2030 -0020 Expires 12 -31 -2011. United States Environmental Protection Agency Washington, DC 20460 Preaward Compliance Review Report for All Applicants and Recipients Requesting EPA Financial Assistance Note: Read instructions on other side before com.letin form. I. Applicant/Recipient (Name, Address, State, Zip Code). Deschutes County EPA Project ' o. 1I. Is the applicant currently receiving EPA assistance? (See * instructions on reverse side) No III. List all civil rights lawsuits and administrative complaints pending against the applicant/recipient that allege discrimination based on race, color, national origin, sex, age, or disability. (Do not include employment complaints not covered by 40 C.F.R. Parts 5 and 7. See instructions on reverse side.) See attachment IV. List all civil rights lawsuits and administrative complaints decided against the applicant/recipient within the last year that allege discrimination based on race, color, national origin, sex, age, or disability and enclose a copy of all decisions. Please describe all coi -ective action taken. (Do not include employment complaints not covered by 40 C.F.R. Parts 5 and 7. See instructions on reverse side.) None V. List all civil rights compliance reviews of the applicant /recipient conducted by any agency within the last two years and enclose a co; iy of the review and any decisions, orders, or agreements based on the review. Please describe any corrective action taken. (40 C.P.R. § 7.8C) c)(3)) None VI.* Does the applicant /recipient provide initial and continuing age, or disability in its programs or activities? (40 a. Do the methods of notice accommodate those with b. Is the notice posted in a prominent place in the applicant's notice that it does not discriminate on the basis of race, color, national ori, ;in, sex, activities, in appropi iate C.F.R. § 5.140 and § 7.95) D Yes ❑ No impaired vision or hearing? D Yes • No offices or facilities or, for education programs and Yes • No periodicals and other written communications? D c. Does the notice identify a designated civil rights coordinator? • Yes 0 No VII.* Does the applicant /recipient maintain demographic data on the race, color, national origin, sex, age, or handicap of the population it serves? (40 C.F.R. § 7.85(a)) . No, any needed demographic data is obtained from the US Census Bureau VIII.* Does the applicant /recipient have a policy /procedure for providing access to services for persons with limited English proficiency? (40 C.F.R. Part 7, E.O. 13166) Yes. IX.* If the applicant /recipient is an education program or activity, or has 15 or more employees, has it designated an employee to coordin ite its compliance with 40 C.F.R. Parts 5 and 7? Provide the name, title, position, mailing address, e-mail address, fax number, and telephone number of the designated coordinator. N/A X If the applicant /recipient is an education program or activity, or has 15 or more employees, has it adopted grievance procedures that assure the prompt and fair resolution of complaints that allege a violation of 40 C.F.R. Parts 5 and 7? Provide a legal citation or Internet ai dress for, or a copy of, the procedures. N/A XI. Will all new facilities or alterations to existing facilities be designed and constructed to be readily accessible to and usable by persons with exception (40 C.F.R. § 7.70) applies. • No disabilities? II Yes. If no, explain how a regulatory For the Applicant/Recipient I certify that the statements I have made on this form and all attachments thereto are true, accurate and complete. I acknowledge false or misleading statement may be punishable by fine or imprisonment or both under applicable law. I assure that I will applicable civil rights statutes and EPA regulations. that any knowingly fully comply with dl C. Date A. Signature of Authorized Official B. Title of Authorized Official For the U.S. Environmental Protection Agency I have reviewed the information provided by the applicant /recipient and hereby certify that the applicant /recipient has submitted required by 40 C.F.R. Parts 5 and 7; that based on the information submitted, this application satisfies 40 C.F.R. Parts 5 and given assurance that it will fully comply with all applicable civil rights statutes and EPA regulations. all information 7; and that the applicant has C. Date A. Signature of Authorized EPA Official B. Title of Authorized EPA Official EPA Form 4700 -4 (Rev. 03/2008). Previous editions are obsolete. EPA FORM 4700 -4 (Rev. 03/2003) III. List all civil rights lawsuits and administrative complaints pending against the applicant/ recipient that allege discrimination based on race, color, national origin, sex, age or disability. Beverly Halpin v Deschutes County, Deschutes County Circuit Court Case # 06 -CV- 0537-ST Steven Kulin v Deschutes County, US District Court Case #06- CV- 0058AB Elizabeth Fincher -Huyck v Deschutes County, Oregon Bureau of Labor and Industries Case #DPEMDPO80911 -71488 Exhibit B: Cash Flow Statement Page 1 Deschutes County Clean Water State Revolving Fund Program DEQ SRF scenario (assume 25 %175% loanlgrant, 0% interest, no admin fees) PRC Purchases & Loan Program 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Beginning Net Working Capital Transfers In - NPA Land Sales Transfers In - NPA PRC Fallback (1) DEQ SRF Homeowner loan repayments (2) Interest (3) Total Revenues PRC Purchases (4) Direct assist. /loans to prop. owners (5) DEQ Loan Payments (6) Program Administration (7) Adaptive Management (8) O &M Circuit Rider (9) $ 508,695 $ 314,809 $ 163,600 $ 408,429 $ 773,172 $ 641,498 $ 298,573 $ 390,132 $ 1,000, 000 1,000,000 1,000,000 8,695 50,101 91,507 9,763 26,034 1,008,695 1,568,559 1,432, 350 150,000 270,000 50,000 25,000 5,000 281,250 750,000 62,500 100,000 50,000 10,000 281,250 750,000 62,500 100,000 50,000 25,000 150,000 1,000,000 132,913 43,166 1,489,679 93,750 750,000 62,500 100,000 50,000 25,000 250,000 150,000 375,000 1,000,000 174,319 215,725 27,924 15,101 1,760,672 1,628,998 750,000 62,500 100,000 50,000 25,000 750,000 62,500 100,000 50,000 25,000 Total Expenditures 500,000 1,253,750 1,268,750 1,081,250 987,500 987,500 Ending Fund Balance Number of loans /grants: 40 250,000 - 375,000 525,000 525,000 257,131 12,444 1,286,073 750,000 62,500 100,000 50,000 25,000 298,537 5,522 1,377,632 750,000 62,500 100,000 50,000 25,000 326,141 7,370 1,248,643 500,000 62,500 100,000 50,000 25,000 987,500 987,500 737,500 508,695 314,809 163,600 408,429 773,172 641,498 298,573 75 75 75 75 390,132 511,143 511,143 $ 373,398 $ 521,675 $ 421,841 339,943 9,812 860,898 250,000 62,500 100,000 50,000 25,000 487,500 373,398 250,000 353,745 7,032 984,175 250,000 62,500 75,000 50,000 25,000 462,500 521,675 352,641 10,025 884,341 250,000 62,500 75,000 50,000 25,000 462,500 421,841 75 75 Notes & Assumptions: (1) Number of PRCs paid for by developer /builder using fallback price of $7,500 (N1 /N2) 0/20 0/20 20/30 20/30 30/40 (2) Assumed $10,000 in 50/50 conventional loans (10 years, 2% interest rate) or payment deferred option (30 yr term or grant) (3) Assumed 2% interest rate (4) County PRC purchases assumed to decline when NPA developers begin purchasing credits again 3,022,500 Number of PRCs purchased by year: 40 in 2009, 75 in 2010, 75 in 2011, and 25 in 2012 (5) Assume average loan is $10,000 (estimated costs of upgrades including PRC transaction: $5,250 - $12,250) (6) DEQ loan terms assumptions: 25% of project funds are loan, 75% are principle forgiven, 0% interest, repayment period is 20 years, no admin fees (7) Third party administrator expenses, contract administration, PRC program admin, program marketing (8) Long term program monitoring, evaluation and update (9) O &M circuit rider provides maintenance service for income qualified homeowners Financial Assistance Program 75 30/40 50 25 25 25 325,037 8,010 754,888 250,000 62,500 75,000 50,000 25,000 462,500 292,388 25 Exhibit B: Cash Flow Statement Page 2 Deschutes County Clean Water State Revolving Fund Program DEQ SRF scenario (assume 25 %!75% loan/grant, 0% interest, no admin fees) PRC Purchases & Loan Program Beginning Net Working Capital Transfers In - NPA Land Sales Transfers In - NPA PRC Fallback (1) DEQ SRF Homeowner loan repayments (2) Interest (3) Total Revenues 2022 2023 2024 2025 2026 2027 $ 292,388 $ 477,197 $ 407,611 $ 350,735 $ 250,000 250,000 484,586 $ 385,252 $ 291,912 258,787 222,901 189,776 153,890 131,806 5,397 9,127 7,723 6,575 9,276 7,271 839,697 745,111 638,235 797,086 647,752 524,329 2028 261,829 $ 250,000 126,285 4,780 642,894 2029 330,394 115,243 6,164 451,801 PRC Purchases (4) - Direct assist. /loans to prop. owners (5) 150,000 150,000 100,000 150,000 100,000 100,000 150,000 50,000 DEQ Loan Payments (6) 62,500 62,500 62,500 62,500 62,500 62,500 62,500 62,500 Program Administration (7) 75,000 50,000 50,000 25,000 25,000 25,000 25,000 25,000 Adaptive Management (8) 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 O &M Circuit Rider (9) 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 Total Expenditures 362,500 337,500 287,500 312,500 262,500 262,500 312,500 212,500 Ending Fund Balance 477,197 407,611 350,735 484,586 385,252 261,829 330,394 239,301 Number of loans /grants: 15 15 10 15 10 10 15 5 Notes & Assumptions: (1) Number of PRCs paid for by developer (2) Assumed $10,000 in 50/50 convention; (3) Assumed 2% interest rate (4) County PRC purchases assumed to de Number of PRCs purchased by year: 4 (5) Assume average loan is $10,000 (estin (6) DEQ loan terms assumptions: 25% of (7) Third party administrator expenses, col (8) Long term program monitoring, evalual (9) O &M circuit rider provides maintenanc( Financial Assistance Program