49-1223

49-1223. Clean water revolving fund; purposes;
capitalization grants

A. Monies in the clean water revolving fund may be used for the following purposes:

1. Making wastewater treatment facility and nonpoint source project loans to
political subdivisions and Indian tribes under section 49-1225.

2. Purchasing or refinancing debt obligations of political subdivisions or
refinancing debt obligations of Indian tribes at or below market rates, provided that the
debt obligation was issued after March 7, 1985 for the purpose of constructing, acquiring
or improving wastewater treatment facilities or nonpoint source projects.

3. Providing financial assistance to political subdivisions to purchase insurance
for local wastewater treatment facility or nonpoint source project bond obligations.

4. Paying the costs to administer the fund, but no more than four per cent of the
aggregate of federal capitalization grants may be used to pay these costs. Monies from
other sources may be used without limit to pay these costs.

5. Funding other programs that are authorized for federal monies deposited in the
fund including programs relating to nonpoint source discharges.

6. Providing linked deposit guarantees through third party lenders by depositing
monies with the lender on the condition that the lender make a loan on terms approved by
the board, at a rate of return on the deposit approved by the board and the state
treasurer and by giving the lender recourse against the deposit of loan repayments that
are not made when due.

B. If the monies pledged to secure water quality bonds become insufficient to pay
the principal and interest on the water quality bonds that are guaranteed by the clean
water revolving fund, the board shall direct the state treasurer to liquidate securities
in the fund as may be necessary and apply those proceeds to make current all payments
then due on the bonds. The state treasurer shall immediately notify the attorney general
and auditor general of the insufficiency. The auditor general shall audit the
circumstances surrounding the depletion of the fund and report the findings to the
attorney general. The attorney general shall conduct an investigation and report those
findings to the governor and the legislature.

C. All proceeds of capitalization grants received from the United States pursuant
to the clean water act shall be deposited in the capitalization grant transfer account
and shall be used solely to provide financial assistance to political subdivisions and
Indian tribes to construct, acquire, restore or rebuild wastewater treatment facilities,
to purchase bond insurance or for any other purpose permitted by the clean water act
including nonpoint source projects. All principal received on loan repayments made by
borrowers pursuant to this section shall be deposited in the clean water revolving fund
and shall be invested and used to provide additional financial assistance or shall be
used to support the administration of the fund subject to the limits prescribed by the
clean water act.