Minnesota 2025-2026 Regular Session

Minnesota Senate Bill SF862 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1.1 A bill for an act
2	2	1.2 relating to capital investment; making changes to the water infrastructure funding
3	3	1.3 program; making changes to the point source implementation grant program;
4	4	1.4 establishing an emerging contaminants grant program; appropriating money for
5	5	1.5 clean water; authorizing the sale and issuance of state bonds; amending Minnesota
6	6	1.6 Statutes 2024, sections 446A.072, subdivision 5a; 446A.073, subdivision 1;
7	7	1.7 proposing coding for new law in Minnesota Statutes, chapter 446A.
8	8	1.8BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
9	9	1.9 Section 1. Minnesota Statutes 2024, section 446A.072, subdivision 5a, is amended to read:
10	10	1.10 Subd. 5a.Type and amount of assistance.(a) For a governmental unit receiving grant
11	11	1.11funding from the USDA/RECD, the authority may provide assistance in the form of a grant
12	12	1.12of up to 65 percent of the eligible grant need determined by USDA/RECD. A governmental
13	13	1.13unit may not receive a grant under this paragraph for more than $5,000,000 $10,000,000
14	14	1.14per project or $20,000 per existing connection, whichever is less, unless specifically approved
15	15	1.15by law.
16	16	1.16 (b) For a governmental unit receiving a loan from the clean water revolving fund under
17	17	1.17section 446A.07, the authority may provide assistance under this section in the form of a
18	18	1.18grant if the average annual residential wastewater system cost after completion of the project
19	19	1.19would otherwise exceed 1.4 percent of the median household income of the project service
20	20	1.20area. In determining whether the average annual residential wastewater system cost would
21	21	1.21exceed 1.4 percent, the authority must consider the total costs associated with building,
22	22	1.22operating, and maintaining the wastewater system, including existing wastewater debt
23	23	1.23service, debt service on the eligible project cost, and operation and maintenance costs. Debt
24	24	1.24service costs for the proposed project are calculated based on the maximum loan term
25	25	1Section 1.
26	26	25-01553 as introduced12/20/24 REVISOR JSK/DG
27	27	SENATE
28	28	STATE OF MINNESOTA
29	29	S.F. No. 862NINETY-FOURTH SESSION
30	30	(SENATE AUTHORS: JOHNSON STEWART, Hauschild, Frentz and Jasinski)
31	31	OFFICIAL STATUSD-PGDATE
32	32	Introduction and first reading02/03/2025
33	33	Referred to Capital Investment 2.1permitted for the clean water revolving fund loan under section 446A.07, subdivision 7.
34	34	2.2The amount of the grant is equal to 80 percent of the amount needed to reduce the average
35	35	2.3annual residential wastewater system cost to 1.4 percent of median household income in
36	36	2.4the project service area, to a maximum of $5,000,000 $10,000,000 per project or $20,000
37	37	2.5per existing connection, whichever is less, unless specifically approved by law. The eligible
38	38	2.6project cost is determined by multiplying the total project costs minus any other grants by
39	39	2.7the essential project component percentage calculated under subdivision 3, paragraph (c),
40	40	2.8clause (1). In no case may the amount of the grant exceed 80 percent of the eligible project
41	41	2.9cost.
42	42	2.10 (c) For a governmental unit receiving a loan from the drinking water revolving fund
43	43	2.11under section 446A.081, the authority may provide assistance under this section in the form
44	44	2.12of a grant if the average annual residential drinking water system cost after completion of
45	45	2.13the project would otherwise exceed 1.2 percent of the median household income of the
46	46	2.14project service area. In determining whether the average annual residential drinking water
47	47	2.15system cost would exceed 1.2 percent, the authority must consider the total costs associated
48	48	2.16with building, operating, and maintaining the drinking water system, including existing
49	49	2.17drinking water debt service, debt service on the eligible project cost, and operation and
50	50	2.18maintenance costs. Debt service costs for the proposed project are calculated based on the
51	51	2.19maximum loan term permitted for the drinking water revolving fund loan under section
52	52	2.20446A.081, subdivision 8, paragraph (c). The amount of the grant is equal to 80 percent of
53	53	2.21the amount needed to reduce the average annual residential drinking water system cost to
54	54	2.221.2 percent of median household income in the project service area, to a maximum of
55	55	2.23$5,000,000 $10,000,000 per project or $20,000 per existing connection, whichever is less,
56	56	2.24unless specifically approved by law. The eligible project cost is determined by multiplying
57	57	2.25the total project costs minus any other grants by the essential project component percentage
58	58	2.26calculated under subdivision 3, paragraph (c), clause (1). In no case may the amount of the
59	59	2.27grant exceed 80 percent of the eligible project cost.
60	60	2.28 (d) Notwithstanding the limits in paragraphs (a), (b), and (c), for a governmental unit
61	61	2.29receiving supplemental assistance under this section after January 1, 2002, if the authority
62	62	2.30determines that the governmental unit's construction and installation costs are significantly
63	63	2.31increased due to geological conditions of crystalline bedrock or karst areas and discharge
64	64	2.32limits that are more stringent than secondary treatment, the maximum award under this
65	65	2.33section shall not be more than $25,000 per existing connection.
66	66	2Section 1.
67	67	25-01553 as introduced12/20/24 REVISOR JSK/DG 3.1 Sec. 2. Minnesota Statutes 2024, section 446A.073, subdivision 1, is amended to read:
68	68	3.2 Subdivision 1.Program established.When money is appropriated for grants under this
69	69	3.3program, the authority shall award grants up to a maximum of $7,000,000 $12,000,000 to
70	70	3.4governmental units to cover 80 percent of the cost of water infrastructure projects made
71	71	3.5necessary by:
72	72	3.6 (1) a wasteload reduction prescribed under a total maximum daily load plan required by
73	73	3.7section 303(d) of the federal Clean Water Act, United States Code, title 33, section 1313(d);
74	74	3.8 (2) a phosphorus concentration or mass limit which requires discharging one milligram
75	75	3.9per liter or less at permitted design flow which is incorporated into a permit issued by the
76	76	3.10Pollution Control Agency;
77	77	3.11 (3) any other water quality-based effluent limit established under section 115.03,
78	78	3.12subdivision 1, paragraph (e), clause (8), and incorporated into a permit issued by the Pollution
79	79	3.13Control Agency that exceeds secondary treatment limits; or
80	80	3.14 (4) a total nitrogen concentration or mass limit that requires discharging ten milligrams
81	81	3.15per liter or less at permitted design flow.
82	82	3.16 Sec. 3. [446A.082] EMERGING CONTAMINANTS GRANTS.
83	83	3.17 Subdivision 1.Definition.For the purposes of this section, "supplemental demographic
84	84	3.18index" means an index in the Environmental Justice Screening and Mapping Tool developed
85	85	3.19by the United States Environmental Protection Agency that is based on socioeconomic
86	86	3.20indicators, including low income, unemployment, less than high school education, limited
87	87	3.21English speaking, and low life expectancy.
88	88	3.22 Subd. 2.Program established.When money is appropriated under this program, the
89	89	3.23authority shall award grants to a governmental unit for up to 80 percent of the cost of drinking
90	90	3.24water infrastructure projects to address a confirmed exceedance of a health advisory level
91	91	3.25for a drinking water emerging contaminant as defined by the Environmental Protection
92	92	3.26Agency.
93	93	3.27 Subd. 3.Eligibility.An eligible project for this program must:
94	94	3.28 (1) be listed on the Drinking Water Revolving Fund Project Priority List per Minnesota
95	95	3.29Rules, part 4720.9015;
96	96	3.30 (2) receive priority points under Minnesota Rules, part 4720.9020, subpart 4a; and
97	97	3.31 (3) be certified by the commissioner of health per Minnesota Rules, part 4720.9060.
98	98	3Sec. 3.
99	99	25-01553 as introduced12/20/24 REVISOR JSK/DG 4.1 Subd. 4.Application and reservation of funds.(a) Grant applications to the authority
100	100	4.2may be made at any time on forms prescribed by the authority, including a project schedule
101	101	4.3and cost estimate for the work necessary to comply with the purpose described in subdivision
102	102	4.42.
103	103	4.5 (b) The commissioner of health shall review and certify to the authority those projects
104	104	4.6that have plans and specifications approved under Minnesota Rules, part 4720.9060. The
105	105	4.7commissioner of health must also indicate in the certification the supplemental demographic
106	106	4.8index scores of the projects.
107	107	4.9 (c) When a project is certified by the commissioner of health, the authority shall first
108	108	4.10reserve grant funds for projects located in a census block group with a supplemental
109	109	4.11demographic index score in the 70th percentile or higher within the state of Minnesota. Any
110	110	4.12remaining funds shall be reserved for projects in the order listed on the commissioner of
111	111	4.13health's project priority list and in an amount based on the cost estimate in the commissioner
112	112	4.14of health certification or the as-bid costs, whichever is less.
113	113	4.15 Subd. 5.Grant amount.The grant amount for an eligible project under this program
114	114	4.16shall be for an amount up to 80 percent of the eligible as-bid project cost up to $12,000,000,
115	115	4.17minus the amount of federal emerging contaminant funds the project receives under section
116	116	4.18446A.081, subdivision 9, paragraph (a), clause (12), or other federal emerging contaminant
117	117	4.19funds.
118	118	4.20 Subd. 6.Grant approval.The authority shall award a grant for an eligible project only
119	119	4.21after:
120	120	4.22 (1) the applicant has submitted the as-bid project cost;
121	121	4.23 (2) the commissioner of health has certified the grant eligible portion of the project; and
122	122	4.24 (3) the authority has determined that the additional financing necessary to complete the
123	123	4.25project has been committed from other sources.
124	124	4.26 Subd. 7.Grant disbursement.Grant funds shall be disbursed by the authority as eligible
125	125	4.27project costs are incurred by the governmental unit and in accordance with a project financing
126	126	4.28agreement and applicable state laws and rules governing the disbursements.
127	127	4.29 Subd. 8.Recovering expenses.Money granted to a grantee under this program may be
128	128	4.30recovered in a civil action brought by the attorney general against any person who may be
129	129	4.31liable under section 115B.04 or any other law. To be eligible for recovery, the expenses
130	130	4.32must be reasonable and necessary expenses, including all response costs, and administrative
131	131	4.33and legal expenses. The authority, Department of Health, and Pollution Control Agency's
132	132	4Sec. 3.
133	133	25-01553 as introduced12/20/24 REVISOR JSK/DG 5.1certification of expenses shall be prima facie evidence that the expenses are reasonable and
134	134	5.2necessary. Any money recovered in a civil action for a project financed with bonds under
135	135	5.3this section shall be transferred to the commissioner of management and budget for deposit
136	136	5.4in the state bond proceeds fund and applied toward principal interest on outstanding bonds.
137	137	5.5 Sec. 4. CLEAN WATER APPROPRIATIONS; GENERAL OBLIGATION BONDS.
138	138	5.6 Subdivision 1.Total appropriation.$299,000,000 is appropriated from the bond
139	139	5.7proceeds fund to the Public Facilities Authority for the purposes of this section.
140	140	5.8 Subd. 2.Emerging contaminants grants.$18,000,000 of this appropriation is for the
141	141	5.9emerging contaminants grant program under Minnesota Statutes, section 446A.082.
142	142	5.10 Subd. 3.State match for revolving loan funds.$39,000,000 of this appropriation is to
143	143	5.11match federal capitalization grants for the clean water revolving fund under Minnesota
144	144	5.12Statutes, section 446A.07, and the drinking water revolving fund under Minnesota Statutes,
145	145	5.13section 446A.081. This appropriation must be used for qualified capital projects.
146	146	5.14 Subd. 4.Water infrastructure funding program.$121,000,000 of this appropriation
147	147	5.15is for grants to eligible municipalities under the water infrastructure funding program under
148	148	5.16Minnesota Statutes, section 446A.072.
149	149	5.17 Subd. 5.Point source implementation grants program.$121,000,000 of this
150	150	5.18appropriation is for grants to eligible municipalities under the point source implementation
151	151	5.19grants program under Minnesota Statutes, section 446A.073. This appropriation must be
152	152	5.20used for qualified capital projects.
153	153	5.21 Subd. 6.Bond sale.To provide the money appropriated in this section from the bond
154	154	5.22proceeds fund, the commissioner of management and budget shall sell and issue bonds of
155	155	5.23the state in an amount up to $299,000,000 in the manner, upon the terms, and with the effect
156	156	5.24prescribed by Minnesota Statutes, sections 16A.631 to 16A.675, and by the Minnesota
157	157	5.25Constitution, article XI, sections 4 to 7.
158	158	5.26 EFFECTIVE DATE.This section is effective the day following final enactment.
159	159	5Sec. 4.
160	160	25-01553 as introduced12/20/24 REVISOR JSK/DG