HB 7207

A bill to be entitled
2An act relating to drinking water; amending s. 403.1837,
3F.S.; renaming the Florida Water Pollution Control
4Financing Corporation as the Florida Water Pollution
5Control and Drinking Water Financing Corporation; revising
6provisions regarding the purpose, powers, and duties of
7the corporation; providing that specified drinking water
8projects and activities are eligible for financing;
9amending s. 403.1835, F.S.; conforming terminology;
10deleting a requirement for the Department of Environmental
11Protection to administer programs funded by the
12corporation; amending s. 403.8532, F.S.; defining the
13terms "bonds" and "corporation"; authorizing the
14department to make or request the corporation to make
15loans, grants, and deposits for planning, designing, and
16constructing specified public water systems; authorizing
17the department to adopt rules regarding the procedural and
18contractual relationship between the department and the
19corporation; clarifying requirements for rules relating to
20loan security criteria; clarifying the purpose of the
21Drinking Water Revolving Loan Trust Fund; amending s.
22403.8533, F.S.; providing that specified use of funds from
23the trust fund is subject to annual appropriation;
24providing that the trust fund is exempt from specified
25termination provisions; amending s. 11.45, F.S.;
26conforming terminology; providing an effective date.
28Be It Enacted by the Legislature of the State of Florida:
30     Section 1.  Subsection (1), paragraphs (f), (g), and (h) of
31subsection (3), and subsections (4), (5), (7), and (11) of
32section 403.1837, Florida Statutes, are amended to read:
33     403.1837  Florida Water Pollution Control and Drinking
34Water Financing Corporation.-
35     (1)  The Florida Water Pollution Control and Drinking Water
36Financing Corporation is created as a nonprofit public-benefit
37corporation for the purpose of financing or refinancing the
38costs of water pollution control projects and activities
39described in ss. s. 403.1835 and 403.8532. The projects and
40activities described in those sections that section are found to
41constitute a public governmental purpose; be necessary for the
42health, safety, and welfare of all residents; and include
43legislatively approved fixed capital outlay projects. The
44fulfillment of the purposes of the corporation promotes the
45health, safety, and welfare of the people of the state and
46serves essential governmental functions and a paramount public
47purpose. The activities of the corporation are specifically
48limited to assisting the department in implementing financing
49activities to provide funding for the programs authorized in ss.
50s. 403.1835 and 403.8532. All other activities relating to the
51purposes for which the corporation raises funds are the
52responsibility of the department, including, but not limited to,
53development of program criteria, review of applications for
54financial assistance, decisions relating to the number and
55amount of loans or other financial assistance to be provided,
56and enforcement of the terms of any financial assistance
57agreements provided through funds raised by the corporation. The
58corporation shall terminate upon fulfillment of the purposes of
59this section.
60     (3)  The corporation shall have all the powers of a
61corporate body under the laws of the state to the extent not
62inconsistent with or restricted by this section, including, but
63not limited to, the power to:
64     (f)  Borrow money and issue notes, bonds, certificates of
65indebtedness, or other obligations or evidences of indebtedness
66described in ss. s. 403.1835 and 403.8532.
67     (g)  Operate, as specifically directed by the department,
68any program to provide financial assistance authorized under ss.
69s. 403.1835(3) and 403.8532, which may be funded from any funds
70received under a service contract with the department, from the
71proceeds of bonds issued by the corporation, or from any other
72funding sources obtained by the corporation.
73     (h)  Sell all or any portion of the loans issued under ss.
74s. 403.1835 and 403.8532 to accomplish the purposes of this
75section and ss. s. 403.1835 and 403.8532.
76     (4)  The corporation shall evaluate all financial and
77market conditions necessary and prudent for the purpose of
78making sound, financially responsible, and cost-effective
79decisions in order to secure additional funds to fulfill the
80purposes of this section and ss. s. 403.1835 and 403.8532.
81     (5)  The corporation may enter into one or more service
82contracts with the department under which the corporation shall
83provide services to the department in connection with financing
84the functions, projects, and activities provided for in ss. s.
85403.1835 and 403.8532. The department may enter into one
86service contracts with the corporation and provide for payments
87under those contracts pursuant to ss. s. 403.1835(9) and
88403.8533, subject to annual appropriation by the Legislature.
89The service contracts may provide for the transfer of all or a
90portion of the funds in the Wastewater Treatment and Stormwater
91Management Revolving Loan Trust Fund and the Drinking Water
92Revolving Loan Trust Fund to the corporation for use by the
93corporation for costs incurred by the corporation in its
94operations, including, but not limited to, payment of debt
95service, reserves, or other costs in relation to bonds issued by
96the corporation, for use by the corporation at the request of
97the department to directly provide the types of local financial
98assistance provided for in ss. s. 403.1835(3) and 403.8532(3),
99or for payment of the administrative costs of the corporation.
100The department may not transfer funds under any service contract
101with the corporation without specific appropriation for such
102purpose in the General Appropriations Act, except for
103administrative expenses incurred by the State Board of
104Administration or other expenses necessary under documents
105authorizing or securing previously issued bonds of the
106corporation. The service contracts may also provide for the
107assignment or transfer to the corporation of any loans made by
108the department. The service contracts may establish the
109operating relationship between the department and the
110corporation and shall require the department to request the
111corporation to issue bonds before any issuance of bonds by the
112corporation, to take any actions necessary to enforce the
113agreements entered into between the corporation and other
114parties, and to take all other actions necessary to assist the
115corporation in its operations. In compliance with s. 287.0641
116and other applicable provisions of law, the obligations of the
117department under the service contracts do not constitute a
118general obligation of the state or a pledge of the faith and
119credit or taxing power of the state, nor may the obligations be
120construed in any manner as an obligation of the State Board of
121Administration or entities for which it invests funds, or of the
122department except as provided in this section as payable solely
123from amounts available under any service contract between the
124corporation and the department, subject to appropriation. In
125compliance with this subsection and s. 287.0582, service
126contracts must expressly include the following statement: "The
127State of Florida's performance and obligation to pay under this
128contract is contingent upon an annual appropriation by the
130     (7)  The corporation is exempt from taxation and
131assessments of any nature whatsoever upon its income and any
132property, assets, or revenues acquired, received, or used in the
133furtherance of the purposes provided in ss. 403.1835, and
134403.1838, and 403.8532. The obligations of the corporation
135incurred under subsection (6) and the interest and income on the
136obligations and all security agreements, letters of credit,
137liquidity facilities, or other obligations or instruments
138arising out of, entered into in connection with, or given to
139secure payment of the obligations are exempt from all taxation;
140however, the exemption does not apply to any tax imposed by
141chapter 220 on the interest, income, or profits on debt
142obligations owned by corporations.
143     (11)  The benefits or earnings of the corporation may not
144inure to the benefit of any private person, except persons
145receiving grants and loans under ss. s. 403.1835 and 403.8532.
146     Section 2.  Paragraphs (b) and (c) of subsection (2) and
147subsections (3) and (10) of section 403.1835, Florida Statutes,
148are amended to read:
149     403.1835  Water pollution control financial assistance.-
150     (2)  For the purposes of this section, the term:
151     (b)  "Bonds" means bonds, certificates, or other
152obligations of indebtedness issued by the Florida Water
153Pollution Control and Drinking Water Financing Corporation under
154this section and s. 403.1837.
155     (c)  "Corporation" means the Florida Water Pollution
156Control and Drinking Water Financing Corporation.
157     (3)  The department may provide financial assistance
158through any program authorized under s. 603 of the Federal Water
159Pollution Control Act (Clean Water Act), Pub. L. No. 92-500, as
160amended, including, but not limited to, making grants and loans,
161providing loan guarantees, purchasing loan insurance or other
162credit enhancements, and buying or refinancing local debt. This
163financial assistance must be administered in accordance with
164this section and applicable federal authorities. The department
165shall administer all programs operated from funds secured
166through the activities of the Florida Water Pollution Control
167Financing Corporation under s. 403.1837, to fulfill the purposes
168of this section.
169     (a)  The department may make or request the corporation to
170make loans to local government agencies, which agencies may
171pledge any revenue available to them to repay any funds
173     (b)  The department may make or request the corporation to
174make loans, grants, and deposits to other entities eligible to
175participate in the financial assistance programs authorized
176under the Federal Water Pollution Control Act, or as a result of
177other federal action, which entities may pledge any revenue
178available to them to repay any funds borrowed. Notwithstanding
179s. 17.57, the department may make deposits to financial
180institutions which earn less than the prevailing rate for United
181States Treasury securities with corresponding maturities for the
182purpose of enabling such financial institutions to make below-
183market interest rate loans to entities qualified to receive
184loans under this section and the rules of the department.
185     (c)  The department shall administer financial assistance
186so that at least 15 percent of the funding made available each
187year under this section is reserved for use by small communities
188during the year it is reserved.
189     (d)  The department may make grants to financially
190disadvantaged small communities, as defined in s. 403.1838,
191using funds made available from grant allocations on loans
192authorized under subsection (4). The grants must be administered
193in accordance with s. 403.1838.
194     (10)  The department may adopt rules regarding program
195administration; project eligibilities and priorities, including
196the development and management of project priority lists;
197financial assistance application requirements associated with
198planning, design, construction, and implementation activities,
199including environmental and engineering requirements; financial
200assistance agreement conditions; disbursement and repayment
201provisions; auditing provisions; program exceptions; the
202procedural and contractual relationship between the department
203and the Florida Water Pollution Control and Drinking Water
204Financing Corporation under s. 403.1837; and other provisions
205consistent with the purposes of this section.
206     Section 3.  Subsections (2), (3), (9), and (14) of section
207403.8532, Florida Statutes, are amended to read:
208     403.8532  Drinking water state revolving loan fund; use;
210     (2)  For purposes of this section, the term:
211     (a)  "Bonds" means bonds, certificates, or other
212obligations of indebtedness issued by the Florida Water
213Pollution Control and Drinking Water Financing Corporation under
214this section and s. 403.1837.
215     (b)  "Corporation" means the Florida Water Pollution
216Control and Drinking Water Financing Corporation.
217     (c)(a)  "Financially disadvantaged community" means the
218service area of a project to be served by a public water system
219that meets criteria established by department rule and in
220accordance with federal guidance.
221     (d)(b)  "Local governmental agency" means any municipality,
222county, district, or authority, or any agency thereof, or a
223combination of two or more of the foregoing acting jointly in
224connection with a project, having jurisdiction over a public
225water system.
226     (e)(c)  "Public water system" means all facilities,
227including land, necessary for the treatment and distribution of
228water for human consumption and includes public water systems as
229defined in s. 403.852 and as otherwise defined in the federal
230Safe Drinking Water Act, as amended. Such systems may be
231publicly owned, privately owned, investor-owned, or
232cooperatively held.
233     (f)(d)  "Small public water system" means a public water
234system which regularly serves fewer than 10,000 people.
235     (3)  The department is authorized to make or request the
236corporation to make loans, grants, and deposits to community
237water systems, nonprofit transient noncommunity water systems,
238and nonprofit nontransient noncommunity water systems to assist
239them in planning, designing, and constructing public water
240systems, unless such public water systems are for-profit
241privately owned or investor-owned systems that regularly serve
2421,500 service connections or more within a single certified or
243franchised area. However, a for-profit privately owned or
244investor-owned public water system that regularly serves 1,500
245service connections or more within a single certified or
246franchised area may qualify for a loan only if the proposed
247project will result in the consolidation of two or more public
248water systems. The department is authorized to provide loan
249guarantees, to purchase loan insurance, and to refinance local
250debt through the issue of new loans for projects approved by the
251department. Public water systems are authorized to borrow funds
252made available pursuant to this section and may pledge any
253revenues or other adequate security available to them to repay
254any funds borrowed. The department shall administer loans so
255that amounts credited to the Drinking Water Revolving Loan Trust
256Fund in any fiscal year are reserved for the following purposes:
257     (a)  At least 15 percent to qualifying small public water
259     (b)  Up to 15 percent to qualifying financially
260disadvantaged communities.
261     (c)  However, if an insufficient number of the projects for
262which funds are reserved under this subsection paragraph have
263been submitted to the department at the time the funding
264priority list authorized under this section is adopted, the
265reservation of these funds shall no longer apply. The department
266may award the unreserved funds as otherwise provided in this
268     (9)  The department may adopt rules regarding the
269procedural and contractual relationship between the department
270and the corporation under s. 403.1837 and is authorized to make
271rules necessary to carry out the purposes of this section and
272the federal Safe Drinking Water Act, as amended. Such rules
274     (a)  Set forth a priority system for loans based on public
275health considerations, compliance with state and federal
276requirements relating to public drinking water systems, and
277affordability. The priority system shall give special
278consideration to the following:
279     1.  Projects that provide for the development of
280alternative drinking water supply projects and management
281techniques in areas where existing source waters are limited or
282threatened by saltwater intrusion, excessive drawdowns,
283contamination, or other problems;
284     2.  Projects that provide for a dependable, sustainable
285supply of drinking water and that are not otherwise financially
286feasible; and
287     3.  Projects that contribute to the sustainability of
288regional water sources.
289     (b)  Establish the requirements for the award and repayment
290of financial assistance.
291     (c)  Require evidence of credit worthiness and adequate
292security, including identification of revenues to be pledged and
293documentation of their sufficiency for loan repayment and
294pledged revenue coverage, to ensure that each loan recipient can
295meet its loan repayment requirements.
296     (d)  Require each project receiving financial assistance to
297be cost-effective, environmentally sound, implementable, and
299     (e)  Implement other provisions of the federal Safe
300Drinking Water Act, as amended.
301     (14)  All moneys available for financial assistance under
302this section shall be deposited in The Drinking Water Revolving
303Loan Trust Fund established under s. 403.8533 shall be used
304exclusively to carry out the purposes of this section. Any funds
305therein which are not needed on an immediate basis for financial
306assistance shall be invested pursuant to s. 215.49. State
307revolving fund capitalization grants awarded by the Federal
308Government, state matching funds, and investment earnings
309thereon shall be deposited into the fund. The principal and
310interest of all loans repaid and investment earnings thereon
311shall be deposited into the fund.
312     Section 4.  Section 403.8533, Florida Statutes, is amended
313to read:
314     403.8533  Drinking Water Revolving Loan Trust Fund.-
315     (1)  There is created the Drinking Water Revolving Loan
316Trust Fund to be administered by the Department of Environmental
317Protection for the purposes of:
318     (a)  Funding for low-interest loans for planning,
319engineering design, and construction of public drinking water
320systems and improvements to such systems;
321     (b)  Funding for compliance activities, operator
322certification programs, and source water protection programs;
324     (c)  Funding for administering loans by the department; and
325     (d)  Payment of amounts payable under any service contract
326entered into by the department under s. 403.1837, subject to
327annual appropriation by the Legislature.
328     (2)  The trust fund shall be used for the deposit of all
329moneys awarded by the Federal Government to fund revolving loan
330programs. All moneys in the fund that are not needed on an
331immediate basis for loans shall be invested pursuant to s.
332215.49. The principal and interest of all loans repaid and
333investment earnings shall be deposited into this fund.
334     (3)  Pursuant to s. 19(f)(3), Art. III of the State
335Constitution, the Drinking Water Revolving Loan Trust Fund is
336exempt from the termination provisions of s. 19(f)(2), Art. III
337of the State Constitution.
338     Section 5. Paragraph (o) of subsection (3) of section
33911.45, Florida Statutes, is amended to read:
340     11.45  Definitions; duties; authorities; reports; rules.-
342Auditor General may, pursuant to his or her own authority, or at
343the direction of the Legislative Auditing Committee, conduct
344audits or other engagements as determined appropriate by the
345Auditor General of:
346     (o)  The Florida Water Pollution Control and Drinking Water
347Financing Corporation created pursuant to s. 403.1837.
348     Section 6.  This act shall take effect upon becoming a law.

CODING: Words stricken are deletions; words underlined are additions.

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