April 24, 2009Client Alert

Update on Use of Federal Stimulus Funds for Clean Water Fund Program and Safe Drinking Water Loan Program

In mid-April, the Wisconsin Department of Natural Resources (“DNR”) announced that it would use a portion of federal stimulus funds provided by the American Recovery and Reinvestment Act of 2009 (“The Act”) for grants and principal forgiveness for grants and loans under the Safe Drinking Water Loan Program (“SDWLP”) and Clean Water Fund Program (“CWFP”). A recent client alert discussing the announcement can be found at:

On April 22, 2009, DNR provided updated information on the awarding and use of such funds.

Update on Funds under SDWLP

  • Application Deadline. The deadline for submission remains April 30, 2009. If enough applications are not received by the deadline, DNR will likely accept additional applications on a first come, first serve basis.
  • Application Requirements. In addition to the Intent to Apply form and Priority Evaluation and Ranking form, municipalities wishing to apply for SDWLP loans must submit to DNR a Requirements Checklist and Addendum to Financial Assistance application by April 30, 2009. The Requirements Checklist provides an overview of all items that must be submitted to obtain SDWLP funds. The Addendum to Financial Assistance Application breaks down the costs involved in the project by category and contains information to determine whether the project is “green.” Both forms can be found at: Finally, municipalities will later be required to submit a Public Service Commission application if it is necessary to increase water rates.
  • Awarding of Funds. The maximum amount of federal stimulus funds any municipality may receive under this program is approximately $9.4 million. DNR intends to close on all loans prior to the end of 2009. The federal stimulus funds will not be used to refinance prior SDWLP loans, including loans for projects on the State Fiscal Year 2009 Funding List.

Update on Funds under CWFP

  • Application Deadline. The application deadline remains June 30, 2009. Like the SDWLP, DNR will likely accept additional applications on a first come, first serve basis if it does not receive enough applications by the June 30th deadline.
  • Awarding of Funds. The maximum amount of funds a municipality may receive under this program is approximately $35.8 million. DNR is still evaluating whether it will award funds to refinance existing loans.

DNR Goals for Awarding Funds under Both Programs

Under both the SDWLP and the CWFP, DNR may bypass projects with higher priority ranking to meet the following goals:

  • DNR will award a specific percentage of the federal stimulus funds to municipalities located in counties with higher unemployment rates than the state in general;
  • DNR is seeking geographic distribution of the funds. At least one municipality in each DNR region will receive federal stimulus funds; and
  • The Act requires that at least 20% of the funds be awarded to “green” projects or project activities. Green projects are those that are energy efficient, water efficient, have green infrastructure, and/or are environmentally innovative.

This client alert is one of a series designed to provide summaries of The Act and information and guidance regarding opportunities and relief made available through The Act. All of The Act client alerts are available on Michael Best's Stimulus and Economic Recovery Team publications page. For additional information on this topic, please feel free to contact one of the authors of this alert or your Michael Best attorney.

If you are interested in learning about other provisions included in The Act, the Michael Best Stimulus and Economic Recovery Team is prepared to assist you in understanding the implications and in developing and implementing a strategy to secure the benefits of this unprecedented legislation. Specifically, we will assist you to identify opportunities, prepare appropriate proposals and make targeted contacts to secure funds. We will also work with you to ensure that your applications are tailored to meet your needs and that your funded projects proceed in compliance with award requirements and applicable laws.

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