By Jon Honeck, Ph.D. Senior Policy Fellow
The Ohio Environmental Protection Agency (OEPA) has released its Draft Program Management Plan for the Water Pollution Control Loan Fund (WPCLF) for program year 2018. The WPCLF is the main source of funding for the design and construction of publicly-owned wastewater and stormwater control projects in Ohio. The WPCLF is a “revolving” loan fund that allows repaid funds to be loaned out again to new borrowers. The plan calls for the Fund to make a total of $520 million in loans in 2018, a level below that of recent years.
The US EPA provides annual funding to support states water infrastructure revolving loan funds. The subsidy allows the WPCLF to lend at below-market interest rates and to provide a limited number of projects with principal forgiveness. For example, the October 2017, standard discount rate on a twenty-year loan is 1.81%. Small communities with populations below 10,000 that also meet economic hardship criteria can receive interest rates of 1% or less. The plan reserves up to $29.9 million for principal forgiveness to address critical needs of economic hardship areas with combined sewer overflow needs or failing home sewage treatment systems.
OEPA extends a zero percent interest rate to borrowers with regionalization projects that connect communities that are served by failing septic systems or wastewater treatment facilities that are otherwise incapable of meeting Clean Water Act requirements. Regionalization of smaller water systems is a crucial way to meet regulatory requirements and control costs.
Greater Ohio Policy Center is working with the Ohio Water Development Authority, Ohio EPA, and other water infrastructure stakeholders in the Small Communities Environmental Infrastructure Group (SCEIG) to find ways to promote shared services and partnering among small communities.
A ranked list of priority projects is published along with the plan. Interested parties can comment on the WPCLF plan at a public hearing on November 20, 2017. For more information, please see the Ohio EPA website.