17607_PMAA_Authority_June_2024

32 The Authority | June 2024 Money for Municipal Authorities By Judith Cassel, Esq., Partner, Hawke McKeon & Sniscak LLP Municipal authorities have exciting new projects that will reduce costs to customers, improve safety, and protect the environment. But these capital projects take money. Where can municipal authorities find the funds to take on these big capital improvements without raising rates? Grants! Projects that are eligible for grants are everything from stormwater management projects, sludge dryers, and green infrastructure to cybersecurity enhancements and training programs. Authorities can review and apply for grants offered by various state agencies including the Department of Environmental Protection (DEP), the Department of Community and Economic Development (DCED), the Commonwealth Financing Authority (CFA), an independent agency of DCED charged with administering Pennsylvania’s economic stimulus packages. Grants offered by the DCED and CFA include the Local Share Account (Statewide) grant, the Business in Our Sites grant, the Community Development Block Grant, and more. Low-Cost Loans In addition to grants, there are low- cost loans available to authorities to fund capital projects. Historically low interest rates have led some authorities to ignore low-cost loans as an option, but with recent federal reserve interest rate increases, loans are becoming more attractive. One such loan source is the Pennsylvania Infrastructure Investment Authority (PENNVEST). PENNVEST offers low-cost financial assistance for sewer, stormwater, and drinking water projects throughout the Commonwealth. During fiscal year 2022- 2023, PENNVEST funded 85 projects with a total of $956,370,826 being provided to these projects. Of these projects, 42 were water projects ($517,559,832), 31 were sewer projects ($416,071,057), seven were stormwater ($19,310,983), and five were non-point source projects ($3,428,954). One funding program offered by PENNVEST is the Clean Water State Revolving Fund (CWSRF), which offers low- interest loans with flexible terms and principal forgiveness funds to finance wastewater and other projects throughout the Commonwealth for the construction, improvement, extension, expansion, repair, or rehabilitation of wastewater collection, treatment, or disposal facilities. PENNVEST also administers the Drinking Water State Revolving Fund (DWSRF), which offers low- Continued on page 61. Interestingly, many capital projects may qualify for DCNR grants if land excavation is incurred or public access is granted to the property. interest loans to assist a variety of borrowers for the construction, expansion, and maintenance of drinking water facilities, and to make improvements and upgrades to water quality systems. Some examples of municipal authorities receiving funding under these programs are Bethlehem Township Municipal Authority receiving a $4,354,000 loan under the CWSRF to construct a new storm sewer system, Northwestern Chester County Municipal Authority receiving a $12,600,000 loan under the CWSRF to make system upgrades for improved nitrification and aeration and to replace equipment approaching end of life, Ebensburg Municipal Authority receiving a $2,983,725 grant and $4,922,366 loan under the DWSRF to replace 23,200 feet of aged, cast iron pipe. For capital projects that reduce an authority’s carbon footprint or make improvements to the environment, grants are available through DEP and the Department of Conservation and Natural Resources (DCNR). DEP grants are tailored toward projects that improve or protect the water, land, and air in Pennsylvania. Examples of DEP grants include the Alternative Fuel Incentive Grant ($5 million annually), Section 319 Nonpoint Source Management Grants ($4.5 million - $5 million