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H.207

Introduced by   Representatives Masland of Thetford, Darrow of Dummerston, Deen of Westminster and McCullough of Williston

Referred to Committee on

Date:

Subject:  Conservation; dam safety; water usage taxes; fire district

Statement of purpose:  This bill proposes to establish a Vermont dam safety state revolving fund to provide loans for the improvement or removal and decommissioning of dams.  It also proposes to allow municipalities to establish fire districts with a mandate of providing for dam safety, which may be attained by dam improvement or by dam removal and decommissioning.  The act requires that these fire districts be established by act of legislation.

AN ACT RELATING TO A DAM SAFETY REVOLVING FUND AND AUTHORIZING FIRE DISTRICTS TO ADDRESS DAM SAFETY

It is hereby enacted by the General Assembly of the State of Vermont:

* * * Creation of Dam Revolving Fund * * *

Sec. 1.  24 V.S.A. § 4751 is amended to read:

§ 4751.  DECLARATION OF POLICY

It is hereby declared to be in the public interest to foster and promote timely expenditures by municipalities for water supply, water pollution control, dam safety, and solid waste management, each of which is declared to be an essential governmental function when undertaken and implemented by a municipality.  It is also declared to be in the public interest to promote expenditures for certain existing privately-owned public water systems and certain privately-owned wastewater systems to bring those systems into compliance with federal and state standards and to protect public health.

Sec. 2.  24 V.S.A. § 4753 is amended to read:

§ 4753.  REVOLVING LOAN FUNDS; AUTHORITY TO SPEND; REPORT

(a)  There is hereby established a series of special funds to be known as:

(1)  The Vermont environmental protection agency (EPA) pollution control revolving fund which shall be used to provide loans to municipalities for planning sewage systems and sewage disposal plants as defined in sections 3501(6) and 3601 of this title, for constructing publicly-owned sewage systems and sewage disposal plants as defined in sections 3501(6) and 3601 of this title, for planning or construction of certain privately-owned wastewater systems, and for implementing related management programs.

(2)  The Vermont pollution control revolving fund which shall be used to provide loans to municipalities for planning pollution control facilities and for constructing publicly-owned pollution control facilities.

(3)  The Vermont environmental protection agency (EPA) drinking water state revolving fund which shall be used to provide loans to municipalities and certain privately-owned water systems for:

(A)  planning, designing, constructing, repairing, or improving a public water system in order to comply with state and federal standards and protect public health; and

(B)  implementing related management programs.

(4)  The Vermont solid waste revolving fund which shall be used to provide loans to municipalities (including union municipal districts formed under subchapter 3 of chapter 121 of this title) for planning solid waste handling and disposal facilities as enumerated in section 2203a of this title, and for constructing publicly-owned solid waste handling and disposal facilities as enumerated in section 2203a of this title.

(5)  The Vermont drinking water planning loan fund which shall be used to provide loans to municipalities and privately-owned, nonprofit community water systems, with populations of less than 10,000, for conducting feasibility studies, and for the preparation of preliminary engineering planning studies and final engineering plans and specifications for improvements to public water systems in order to comply with state and federal standards and to protect public health.  The secretary may forgive up to $50,000.00 of the unpaid balance of a loan made from the Vermont drinking water planning loan fund to municipalities after project construction is substantially completed.  The secretary shall establish amounts, eligibility, policies, and procedures for loan forgiveness in the annual state intended use plan (IUP) with public review and comment prior to finalization and submission to the United States Environmental Protection Agency.

(6)  The Vermont drinking water source protection fund which shall be used to provide loans to municipalities for purchasing land or conservation easements in order to protect public water sources and ensure compliance with state and federal drinking water regulations.

(7)  The Vermont drinking water emergency use fund which shall be within the control of the secretary.  Disbursements from the fund may be made by the secretary for costs required to undertake the following emergency actions that the secretary considers necessary to protect public health:

(A)  collecting and analyzing samples of drinking water;

(B)  hiring contractors to perform or cause to be performed infrastructure repairs of a public water system;

(C)  hiring certified operators to perform operational activities at a public water system; and

(D)  providing or causing to be provided bottled or bulk water for a public water system due to problems with quality or quantity, or both.

(8)  The Vermont stormwater management fund which shall be used to provide grants and loans to municipalities, pursuant to rules proposed by the agency of natural resources and enacted by the general assembly, for planning, designing, engineering, constructing, repairing, or improving infrastructure necessary to protect the waters of the state from the adverse impacts of untreated stormwater runoff.  Funds may also be used to plan and establish a process for managing stormwater within or among municipalities.

(9)  The Vermont dam safety state revolving fund which shall be used to provide loans to municipalities and certain privately-owned water systems for: planning, designing, constructing, repairing, improving, or removing and decommissioning a dam in order to preserve property and protect the public safety.

* * *

Sec. 3.  24 V.S.A. § 4754 is amended to read:

§ 4754.  LOAN APPLICATION

A municipality may apply for a loan, the proceeds of which shall be used to acquire, design, plan, construct, enlarge, repair, or improve a publicly-owned sewage system, sewage disposal plant, pollution control facility, water supply, water system, or solid waste handling and disposal facility, or certain privately-owned wastewater systems as described in section 4763 of this title, or to implement a related management program.  A municipality may apply for a loan, the proceeds of which shall be used to acquire, design, plan, construct, enlarge, repair, improve, or remove and decommission a publicly-owned dam, or certain privately-owned dams as described in section 4764 of this title, or to implement a related management program.  In addition, the loan proceeds shall be used to pay the outstanding balance of any engineering planning advances made to the municipal applicant under chapter 55 of Title 10 and determined by the secretary of the agency of natural resources to be due and payable following construction of the improvements to be financed by the proceeds of the loan, or possibly, following removal and decommissioning of a dam to be financed by the proceeds of the loan.  The bond bank may prescribe any form of application or procedure required of a municipality for a loan hereunder.  Such application shall include such information as the bond bank shall deem necessary for the purpose of implementing this chapter.

Sec. 4.  24 V.S.A. § 4756(a) is amended to read:

(a)  No construction loan or loan for the purchase of land or conservation easements to a municipality shall be made under this chapter, nor shall any part of any revolving fund which is designated for project construction be expended under section 4757 of this title, until such time as:

(1)  the secretary shall certify to the bond bank that all water supply and wastewater permits, land use, subdivision, public building, and discharge permits, necessary to construct the improvements or the dam removal and decommissioning to be financed by the loan will be issued to the applicant municipality prior to disbursement of funds under the loan for construction;

(2)  the applicant municipality shall certify to the bond bank that it will have secured all state and federal permits, licenses, and approvals necessary to construct the improvements to be financed by the loan, or to remove and decommission the dam, prior to expending funds under the loan;

(3)  the applicant municipality shall certify to the bond bank that it has established a rate charge or assessment schedule which will generate annually sufficient revenue to pay the principal of and interest on the municipal bond or other debt instrument which evidences the construction loan, or dam removal and decommissioning loan, made by the bond bank to the municipality under this chapter and, except in the case of dam removal and decommissioning, to pay reasonably anticipated costs of operating and maintaining the financed project and the system of which it is a part.  A covenant by the municipality to set, collect and apply rates, charges, and assessments under sections 3313, 3348, 3616, or 3679 of this title shall be sufficient for the purposes of this certification requirement.  When the financing of the project anticipates revenues from the sale of electricity, evidence shall be submitted showing that construction of the project has been authorized and that rates for the project have been approved by the public service board;

(4)  except in the case of dam removal and decommissioning, the applicant municipality shall certify to the bond bank that it has created a fund under section 2804 of this title, or by any other means permitted by law, including adoption of a resolution or covenant by the legislative branch of the applicant municipality, which fund shall be used only to repair, replace, improve, or enlarge the project for which the loan is made;

(5)  the applicant municipality, and the project to be financed by the proceeds of the loan, have been designated by the agency, or a department thereof, as eligible to participate in a construction or implementation program, or a dam removal and decommissioning program, funded wholly or in part by the state or the United States of America;

(6)  the secretary shall certify to the bond bank that any management program to be financed under subsection subdivision 4753(a)(1) and section 4754 of this title is in conformance with all applicable state and federal laws, and all regulations promulgated thereunder;

(7)  the secretary shall certify to the bond bank that the loan eligibility priority established under section 4758 of this chapter entitles the applicant municipality to immediate financing or assistance under this chapter;

(8)  the secretary shall certify to the bond bank the outstanding balance of engineering planning advances paid to the applicant municipality under chapter 55 of Title 10, and included within the loan application submitted under section 4754 of this chapter; and

(9)  the applicant municipality, in the case of applications by towns, cities and incorporated villages, and with respect to all loans awarded after July 1, 1992, shall certify to the bond bank that the project conforms to a duly adopted capital budget and program, consistent with 24 V.S.A. chapter 117, for meeting the water supply, pollution control, dam safety, or solid waste needs of the municipality; and

(10)  the applicant municipality, in the case of an application by a district, shall certify to the bond bank that the project conforms to a capital budget and program duly adopted by the district in accordance with the provisions of its charter.

Sec. 5.  24 V.S.A. § 4757 is amended to read:

§ 4757.  REVOLVING LOAN FUNDS; ADDITIONAL USES

In addition to providing a source of funds from which loans may be made to municipalities under this chapter, each fund created under section 4753 of this chapter may be used for one or more of the following purposes:

(1)  to make loans, to refund bonds or notes of a municipality issued after March 7, 1985 for sewerage works, or after July 1, 1993 for water supply systems for the purpose of financing the construction of any capital improvements or management program, or dam removal and decommissioning, described in section 4753 and certified under section 4756 of this title;

(2)  to guarantee or insure, directly or indirectly, the payment of notes or bonds issued or to be issued by a municipality for the purpose of financing the construction of any capital improvement or management program, or dam removal and decommissioning, described in section 4754 of this title and certified under section 4756;

(3)  to guarantee or insure, directly or indirectly, funds established by municipalities for the purpose of financing construction of any capital improvement, or dam removal and decommissioning, described in section 4754 of this title;

(4)  to invest available fund balances, and to credit the net interest income thereon to the particular fund providing investment funds; and

(5)  to pay the costs of the bond bank, VEDA and the agency associated with the administration of each fund; provided, however, that no more than four percent of the aggregate of the highest fund balances in any fiscal year shall be used for such purposes, and that a separate account be established outside the drinking water state revolving fund for such purposes.  As used in this subsection, costs shall include fiscal, clerical, administrative, and issuance expenditures directly attributable and allocated to the maintenance implementation and administration of the loan funds created under this chapter.

Sec. 6.  24 V.S.A. § 4758 is amended to read:

§ 4758.  LOAN PRIORITIES

(a)  Periodically, and at least annually, the secretary shall prepare and certify to the bond bank a project priority list of those municipalities whose publicly‑owned projects, privately-owned dams, or privately-owned wastewater systems, are eligible for financing or assistance under this chapter.  In determining financing availability for wastewater projects under this chapter, the secretary of the agency having jurisdiction shall apply the following criteria:

(1)  the probable public benefit to be gained or preserved by the project to be financed;

(2)  the long-term costs and the resulting benefits to be derived from the project.  In determining benefits, induced growth from a project that is not consistent with a town, city, or village plan, duly adopted under chapter 117 of this title, will not be considered;

(3)  the cost of comparable credit or financing alternatives available to the municipality;

(4)  the existence of immediate public health, safety, and welfare factors, and compliance therewith;

(5)  the existence of an emergency constituting a threat to public health, safety, and welfare; and

(6)  the current area and population to be served by the proposed project.

* * *

Sec. 7.  24 V.S.A. § 4764 is added to read:

§ 4764.  LOANS FOR PRIVATELY-OWNED DAMS

(a)  Where the secretary has determined that the construction, repair, replacement, or removal and decommissioning of a privately-owned dam is the preferred alternative to abate or control a dam safety problem, a loan may be made to a municipality from the Vermont dam safety state revolving fund established in section 4753 of this title.  In such cases, the following conditions shall apply:

(1)  Guaranteed repayment of the loan will be based on a municipal bond, but actual repayment may be made with funds from the owner, as set forth in an agreement between the owner and the municipality.

(2)  In all cases, there shall be a binding agreement between the owner and the municipality that provides for the proper operation and maintenance of the privately-owned dam for at least the term of the loan, except in the case of dam removal and decommissioning.

(3)  All conditions and limitations of section 4755 of this title apply to loans made under this section.

(4)  No construction or dam removal and decommissioning loan shall be made to a municipality under this subsection, nor shall any part of any revolving loan made under this subsection be expended until all of the following take place:

(A)  The secretary certifies to the bond bank that all land use, stream alteration, and dam permits necessary to construct and operate the improvements to be financed by the loan, or those necessary to remove and decommission the dam, have been issued to the owner of the privately-owned dam.

(B)  The applicant municipality certifies to the bond bank that the private dam owner has secured all state and federal permits, licenses, and approvals necessary to construct and operate the dam improvements or to complete the dam removal and decommissioning to be financed by the loan.

(C)  The secretary certifies to the bond bank that the loan eligibility priority established under section 4758 of this title entitles the applicant municipality to immediate financing or assistance under this chapter.

(b)  The bond bank may make loans to a municipality for the preparation of final engineering plans and specifications for the construction, repair, replacement, or removal and decommissioning of a privately-owned dam in the same manner as set forth in subsection 4756(b) of this title.

* * * Fire District for Dam Safety * * *

Sec. 8.  20 V.S.A. § 2481(c) is added to read:

(c)  In the case of any fire district formed for dam safety purposes, formation of the district and any amendment of the district shall be effective only as established by act of the general assembly. 

Sec. 9.  20 V.S.A. § 2601 is amended to read:

§ 2601.  GENERALLY

A fire district may vote to adopt the town manager system in compliance with chapter 37 of Title 24.  It may vote a tax upon the polls and taxable estate or upon the taxable estate only for the protection of property in the district from damage by fire or damage caused by the breach of a dam or other failure of a dam to function properly; for the acquisition, construction, and maintenance of sewers and sewage treatment works; sidewalks; dams; public parks; water works waterworks, water companies, and equipment and real estate used in connection therewith including reservoirs and dams; for lighting; and for other lawful purposes.  The prudential committee and collector shall have the same power in assessing, levying, and collecting the tax, as town officers have in assessing and collecting town taxes, including the collection of interest on overdue taxes.  The prudential committee may expend such sums for acquiring, constructing, and maintaining sewers and sewage treatment works; sidewalks; dams; public parks; water works, water companies, and all equipment and real estate used in connection therewith, including reservoirs and dams; for dam removal and decommissioning; and for lighting purposes as the fire district may vote.  The committee may use and occupy such portions of the highways within the district as may be necessary for constructing and maintaining sewers and sewage treatment works; sidewalks; public parks; water works waterworks and mains and for lighting purposes.

Sec. 10.  20 V.S.A. § 2604 is amended to read:

§ 2604.  PRESERVATION OF PROPERTY

In the name of the district, the prudential committee may make contracts and expenditures for the preservation of property in such district from damage by fire, or by the breach of a dam or other failure of a dam to function properly, as they deem it deems necessary, and draw orders on the treasury therefor.  However, such committee shall not bind the district for a greater sum than has been voted.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us