Article 2. Clean Water Loans And Grants of California Water Code >> Division 24. >> Chapter 5. >> Article 2.

Unless the context otherwise requires, the following definitions govern the construction of this article:
  (a) "Eligible project" means a project or activity described in paragraph (1), (2), (3), or (4) of subdivision (a) of Section 13480 that is all of the following:
  (1) Necessary to prevent water pollution or to reclaim water.
  (2) Eligible for funds from the State Revolving Fund Loan Account or federal assistance.
  (3) Certified by the board as entitled to priority over other eligible projects.
  (4) Complies with applicable water quality standards, policies, and plans.
  (b) "Federal assistance" means money provided to a municipality, either directly or through allocation by the state, from the federal government to construct eligible projects pursuant to the Clean Water Act.
  (c) "Municipality" has the same meaning as defined in the Clean Water Act and also includes the state or any agency, department, or political subdivision thereof, and applicants eligible for assistance under Sections 1329 and 1330 of Title 33 of the United States Code.
  (d) "Small community" means a municipality with a population of 5,000 persons or less, or a reasonably isolated and divisible segment of a larger municipality encompassing 5,000 persons or less, with a financial hardship as determined by the board.
  (e) "Treatment works" has the same meaning as defined in the Clean Water Act.

There is hereby created in the account both of the following subaccounts:
  (a) The State Revolving Fund Loan Subaccount.
  (b) The Small Communities Grant Subaccount.

The board may, by contract or otherwise, undertake plans, surveys, research, development, and studies necessary or desirable to carry out this article, and may prepare recommendations with regard thereto, including the preparation of comprehensive statewide or areawide studies and reports on the collection, treatment, and disposal of waste under a comprehensive cooperative plan.

Not more than 3 percent of the total amount deposited in the State Revolving Fund Loan Subaccount and the Small Communities Grant Subaccount may be used for both of the following purposes:
  (a) To pay the costs incurred in connection with the administration of this article.
  (b) For the purposes of Section 78612.

The following amounts are hereby transferred from the account to the State Revolving Fund Loan Subaccount and the Small Communities Grant Subaccount and, notwithstanding Section 13340 of the Government Code, continuously appropriated, without regard to fiscal years, from the subaccounts to the board:
  (a) Eighty million dollars ($80,000,000) to the State Revolving Fund Loan Subaccount for the purposes of providing loans pursuant to the Clean Water Act, to aid in the construction or implementation of eligible projects, and for the purposes described in Section 78612.
  (b) Thirty million dollars ($30,000,000) to the Small Communities Grant Subaccount for grants by the board to small communities for construction of eligible treatment works. If, in the judgment of the board, the money in the Small Communities Grant Subaccount will not be expended within a reasonable time, the board may transfer the money to the State Revolving Fund Loan Subaccount to be used for any of the purposes specified in subdivision (a).
  (c) The board may transfer unallocated funds from the State Revolving Fund Loan Subaccount to the State Water Pollution Control Revolving Fund for the purposes of meeting federal requirements for state matching funds to provide loans in accordance with the Clean Water Act.

For purposes of subdivision (a) of Section 78613, the board may make loans to municipalities, pursuant to contract, to aid in the construction or implementation of eligible projects.

For purposes of subdivision (b) of Section 78613, the board may make grants to small communities so that any combined federal and state grant does not exceed 97 1/2 percent of the eligible cost of necessary studies, planning, design, and construction of the eligible project determined in accordance with applicable state law and regulations. The total amount of grants made pursuant to subdivision (b) of Section 78613, for any single project, may not exceed three million five hundred thousand dollars ($3,500,000).

Any contract entered into pursuant to this article for loans or grants may include provisions determined by the board, and shall include all of the following provisions:
  (a) An estimate of the reasonable cost of the project.
  (b) A description of the type of assistance being offered.
  (c) An agreement by the board to pay to the entity, during the progress of the project or following completion, as agreed upon by the parties, the amount specified in the contract determined pursuant to applicable federal and state laws and regulations.
  (d) An agreement by the public entity to proceed expeditiously with, and complete, the project, commence operation of the project upon completion, properly operate and maintain the project in accordance with applicable provisions of law, and provide for payment of the public entity's share of the cost of the project.

All contracts entered into pursuant to this article for loans or grants are also subject to both of the following requirements:
  (a) Public entities seeking assistance shall demonstrate, to the satisfaction of the board, that an adequate opportunity for public participation regarding the project has been provided.
  (b) Any election held with respect to the project shall include the voters of the entire municipality unless the municipality proposes to accept the assistance on behalf of a specified portion or portions of the municipality, in which case the election shall be held in that portion or portions of the municipality only.

Any loan made pursuant to subdivision (a) of Section 78613 shall be for a period not to exceed 20 years, with an interest rate set in accordance with Section 13480.

All principal and interest payments received pursuant to loan contracts entered into pursuant to this article shall be deposited in the State Revolving Fund Loan Subaccount for additional loans under subdivision (a) of Section 78613, and shall not be transferred to the General Fund.