Illinois Rural Water Association

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Illinois Rural Water Association

• ARRA Circuit-Riders

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ARRA Assistance

• IRWA Circuit riders Have frequent visits with
  smaller systems.
• Rural Development may ask for assistance with
  potential applicants
• Can provide a quick, basic overview of process

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• Other Assistance Could Include
• Identifying facility problems apparent needs
• Referring Owner to other communities with similar
  successful projects
• Technical assistance for Owners management team
• Checking references
• Rate studies, (following)

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What are Reasonable User Charges???

• System user charges should be
• reasonable
• produce enough revenue to provide for all costs
  of the facility
• OM, debt service, debt reserve, short-lived
  assets reserve

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Don Craig ARRA CR 1217-561-1061 Map Areas 2
3(East-central South)

• Bill Dowell ARRA CR 2
• 217-820-1562
• Map Areas 1 4
• (West-central North)

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• WHO IS ELIGIBLE FOR ASSISTANCE?
• Municipalities
• Counties
• Special Service Districts
• Indian Tribes
• Non-Profit Corporations
• (Including Cooperatives)

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Priority Applications

• Public body or Indian Tribe
• Small systems populations under 5,000
• Low income poverty level and below
• Correct a health or sanitation issue
• Merge small facilities
• Funds from other sources obligated
• Agency targeted area

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• WHAT CAN BE FUNDED (USE OF FUNDS)
• Construct, Repair, Modify, Expand or Improve
• Water
• Sanitary Sewage
• Solid Waste Disposal
• Storm Wastewater Disposal

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USE OF FUNDS (WHAT CAN BE FUNDED CONT.)

• Related Costs
• Legal Fees
• Engineering Fees
• Land Acquisition
• Water Rights

• Equipment
• Purchase/Refinance
• (under certain conditions)
• Permits

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Reasons For Project

• HEALTH SAFETY
• SYSTEM OM
• REASONABLE GROWTH

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• DIRECT LOAN INTEREST RATES
• Set Quarterly
• Three levels of Rates
• Poverty
• Intermediate
• Market

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• DIRECT LOAN TERMS
• Loan Only - Up to 40 Years or useful life of the
• facility
• Loan and Grant Mix Maximum of 40 years or the
  useful life of the facility

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• COMBINED OR PARTNERSHIP FUNDING
• Projects may be funded by combining funding from
  other sources in order to fully fund the project.
• Funding Sources
• Federal
• State
• Private

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• GRANT PROGRAM
• May be provided, when necessary, to reduce user
  costs to a reasonable level.
• Grant eligibility does not constitute the amount
  of grant a project may receive.

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• GRANT ELIGIBILITY
• Not to exceed 75 of eligible costs
• Project to alleviate a health or sanitary or
  security problem.
• AND
• MHI of service area is less the higher of the
  poverty line or 80 of the SNMHI.

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• GRANT ELIGIBILITY (CONT.)
• Not to exceed 45 of eligible costs
• The project is not eligible for up to 75
• MHI of service area is less than the SNMHI.
• 0 of eligible costs
• MHI of service area is greater than the SNMHI.

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• APPLICATION SUBMITTAL
• Accepted Year Around
• Local Servicing Office
• For an office location nationwide with contact
  persons and telephone numbers go to this website
• http//www.rurdev.usda.gov.recd_map.html

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IRWA Interim Financing Program
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IRWA is excited to announce that a new interim
loan program is now available for systems whose
long term debt holder will be Rural Development.
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To assist borrowers in the USDA-RD Interim
Financing clause, which states in part
"Interim Financing - for all loans exceeding
500,000, where funds can be borrowed at
reasonable interest rates on an interim basis
from commercial sources for the construction
period. . . "
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Illinois Rural Water Association, in conjunction
with First Mid-Illinois Bank Trust, created
this interim financing program to provide
construction funding once a permanent loan
commitment is received from the USDA-RD.
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IF Program structure enables communities access
to construction funds at a very low cost of
borrowing. Loan proceeds are utilized for the
construction period only and arepaid off with
USDA-RD funds when the project is complete or
funded.
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INTEREST RATES

• Tax-Exempt Loans
• 1.0 over USDA-RD published quarterly rate for
  each of the Market, Intermediate and Poverty
  rates
• However, minimum interest rate shall be 4.0
• NO APPLICATION FEES or POINTS

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INTEREST RATES (cont.)

• Non-Tax-Exempt Loans
• 2.0 over USDA-RD published quarterly rate for
  each of the Market, Intermediate and Poverty
  rates
• However, minimum interest rate shall be 5.0
• NO APPLICATION FEES or POINTS

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LOAN PROCESS

• Pre-Application Process
• Apply with the USDA-RD for
• permanent financing.

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Application PhaseOnce long-term financing has
been approved by USDA-RD, obtain Interim
Financing Application from the Illinois Rural
Water Association, complete, and return with RD
Letter of Conditions (Commitment Letter).
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Loan Approval PhaseComplete the Interim
Financing application and return to IRWA.
Interim Financing will be approved in a matter of
days.
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Disbursement PhaseFunds will be disbursed
through standardized pay-requisitions and may be
faxed, along with copies of any applicable lien
waivers, to the Illinois Rural Water Association.
The RD Engineer and Borrower must sign and
approve each request for funds. Construction
funds aretransferred to the Borrowers
constructionaccount at First Mid-Illinois Bank
for actual disbursement.
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Loan Payoff PhaseOnce the participant is ready
to payoff, and the permanent funds have been
received, the payoff is coordinated through the
Illinois Rural Water Association.
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The Interim Financing Program brochure and
application can be found at www.ilrwa.org by
clicking on the Interim Financing link near the
bottom of the webpage.
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• Please contact Frank Dunmire
• at IRWA for more information.
• 217-287-2115