4. PRIVAGE SEWAGE SYSTEM REPLACEMENT AND REHABILITATION LOAN PROGRAM
SEG $3,000,000
Governor: Create a private sewage system replacement and rehabilitation no-interest loan program within the environmental improvement fund. Specify that it may be used only in a year in which the Department of Commerce must prorate funds under the private sewage system replacement and rehabilitation grant program. Commerce is appropriated $3,500,000 GPR annually to provide financial assistance to home and small business owners who meet certain income and eligibility criteria, to cover a portion of the cost of repairing or replacing failing private sewage systems. The owner of a failing private sewage system applies to the county, Commerce provides grants to participating counties and the county is responsible for disbursing all grant awards to property owners (participants also include the Oneida Tribe and City of Franklin in Milwaukee County). In a year when approved applications exceed available funding, Commerce is required to prioritize funds, giving highest priority to systems which fail by discharging sewage to surface water, groundwater, drain tiles, bedrock or zones of saturated soils, and second priority to systems which fail by discharging sewage to the surface of the ground.
Under the bill, $3,000,000 SEG in 1999-00 would be provided as a one-time annual appropriation from the environmental improvement fund. (Administration officials indicate that the intent was to provide a continuing appropriation to allow loans to be made after 1999-00. A technical correction would be required to accomplish this intent.) Revenues to the fund come from federal grants, state match to federal grants provided through general obligation bonding authority, loan repayments from clean water fund loans to municipalities to upgrade or replace wastewater treatment plants to meet state and federal requirements and investment earnings. In a year in which Commerce prorates funds under the private sewage system replacement and rehabilitation grant program, counties could apply to Commerce for a loan under the new environmental improvement fund loan program. The county could only use a loan to increase the grant amount to eligible persons to the amount which the persons would have been eligible to receive under the grant program.
A loan to a county would bear no interest. The loan amount could not exceed the difference between the amount the county would have received if Commerce had not prorated grants and the amount that the county did receive. If the amount available for loans under the program is insufficient to provide loans to all eligible counties in a year, Commerce would be required to prorate loans in the same manner as under the grant program.
A loan could be for no longer than 20 years, as determined by DOA, and be fully amortized no later than 20 years after the original date of the loan. In order to obtain a loan, a county would pledge any security required by DOA and demonstrate the financial capacity to assure sufficient revenues to repay the loan. Commerce and DOA would enter into a financial assistance agreement with an eligible county. DOA, in consultation with Commerce, could establish terms and conditions of a financial assistance agreement that relate to its financial management, including what type of municipal obligation is required for the repayment of the loan. DOA could consider relevant factors, including the type of obligation, the pledge of security and the county's creditworthiness. DOA would be responsible for disbursing the loan to the county, and, in consultation with Commerce, would establish procedures for disbursing loans.
If a county would fail to make a principal repayment when due, DOA would place on file a certified statement of all amounts due. After consulting with Commerce, DOA could collect the past amounts due by deducting those amounts from any state payments due to the county or may add a special charge to the amount of state tax apportioned to and levied upon the county. Amounts collected would be deposited to the fund to which they are due and DOA would notify Commerce that it has done so.
[Bill Sections: 304, 305, 707, 1649, 2238, 2505 and 2506]
5. LAND RECYCLING LOAN PROGRAM CHANGES
Governor: Expand the definition of eligible applicant to include a redevelopment authority or a housing authority. Currently, cities, villages, towns and counties are eligible for land recycling loans. Further, eliminate the requirement that loan recipients pay interest. Currently, land recycling loans are charged an interest rate of 55% of the market interest rate, or approximately 2.64%. The bill retains the current law provision of a maximum of $20,000,000 for land recycling loans.
[Bill Sections: 2513 thru 2517, 2519 and 2520]
6. STATUTORY CHANGES
Governor: Provide for the following statutory changes to the environmental improvement fund:
a. Specify that assistance under the small loan program may not exceed the amount of subsidy that would have been provided if the loan would have been made directly under the clean water fund, the safe drinking water loan or the land recycling loan programs. The small loan program provides a payment to the Board of Commissioners of Public Lands to reduce interest payments on a loan from the Board for a project that is eligible under one of the three programs.
b. Eliminate the authority to make capital cost loans under the clean water fund program. Currently, a total of up to $120 million in clean water funds may be loaned at the market interest rate to any of the Cities of Brookfield, Mequon, Muskego and New Berlin and the Villages of Butler, Elm Grove, Germantown, Menomonee Falls and Thiensville if all of the communities have signed an agreement with the Milwaukee Metropolitan Sewerage District under which the communities agreed to reimburse MMSD for at least $120.0 million of MMSD's capital costs. In October, 1996, MMSD and the communities signed an agreement through which the communities paid MMSD $140.7 million for past debts. All of the communities chose to borrow individually from private sources instead of utilizing the clean water fund.
c. Authorize a local government to issue a promissory note with a term not to exceed 20 years in connection with a safe drinking water loan program or land recycling loan program project. Currently, the term of a promissory note issued in connection with a clean water fund project may not exceed 20 years, but otherwise a promissory note issued by a local government may generally not have a term of more than 10 years.
d. Clarify that clean water fund projects for planning and design are only eligible for clean water fund financing if the projects also include construction or replacement of treatment works that violate effluent limitations contained in an existing permit.
e. Delete obsolete language related to providing clean water fund loans for purchase or refinance of certain obligations incurred between 1985 and 1988.
f. Clarify that a loan approved under the clean water fund program, the safe drinking water loan program or the land recycling loan program shall be fully amortized not later than 20 years after the original date of the "financial assistance agreement" (rather than "note" currently).
[Bill Sections: 1647, 1649, 2491 thru 2504, 2511, 2512, 2518 and 2521]
ETHICS BOARD
Budget Change Items
1. STANDARD BUDGET ADJUSTMENTS
GPR $29,000
PR 6,000
Total $35,000
Governor: Adjust the agency's base budget by $14,500 GPR and $3,000 PR annually for: (a) full funding of salaries and fringe benefits ($11,700 GPR and -$500 PR); (b) full funding of financial service charge-backs ($100 GPR and $200 PR); and (c) reclassification of positions ($2,700 GPR and $3,300 PR).
2. INFORMATION TECHNOLOGY COSTS
GPR $27,000
PR 33,000
Total $60,000
Governor: Provide $13,500 GPR and $16,500 PR annually for information technology costs. The funds would be used as follows: (a) Website maintenance: $20,000 annually ($9,000 GPR and $11,000 PR) would be used to employ outside IT staff to maintain and upgrade the Ethics Board internet website (including the lobbyists-on-line information system), based on 200 hours of staff time annually at $100 per hour; and (b) Permanent property replacements: $10,000 annually ($4,500 GPR and $5,500 PR) as a general increase in base budget funding for unspecified permanent property replacements (primarily IT hardware and software and copying equipment).
3. INVESTIGATION COSTS
Governor: Modify current law to permit the Governor, upon request of the Ethics Board, to appoint special counsel to assist in investigating and prosecuting alleged violations of the state lobbying or ethics laws. Under current law, the Governor may authorize the employment of special counsel in the following situations: (a) to assist the Attorney General in any action; (b) to act instead of the Attorney General in any action if the Attorney General is adversely interested; (c) to defend any officer of the state from any action instituted by the Attorney General; and (d) to institute and prosecute any action for which the Attorney General deems it is his or her duty to defend rather than prosecute. When authorized by the Governor, a special counsel is paid from a GPR sum sufficient appropriation in the Department of Justice. The Governor is responsible for execution of a contract between the state and the appointed special counsel which sets the amount the special counsel is to be paid. No estimated increase in expenditures has been included in DOJ's special counsel appropriation for the new purpose of investigating and prosecuting violation of the state's lobbying or ethics laws.
[Bill Sections: 9 and 10]
FINANCIAL INSTITUTIONS
Budget Change Items
1. STANDARD BUDGET ADJUSTMENTS
PR - $232,000
Governor: Adjust the agency's base budget for: (a) turnover reductions (-$178,700 annually); (b) nonrecurring costs (-$282,300 annually); (c) full funding of salaries and fringe benefits ($281,500 annually); (d) financial services charge-backs ($4,300 annually); (e) reclassifications ($6,100 in 1999-00 and $7,600 in 2000-01); (f) fifth week of vacation as cash ($44,300 in 1999-00 and $46,800 in 2000-01); and (g) full funding of leases and directed move costs ($6,800 annually).
2. ADDITIONAL TECHNOLOGY INITIATIVES
PR $378,700
Governor: Provide $186,500 in 1999-01 and $192,200 in 2000-01 for additional technology initiatives. The recommendation would provide one-time financing to: (a) implement the statewide electronic forms initiative of the Department of Administration ($76,900 in 1999-00 and $79,800 in 2000-01); and (b) develop a shared system to provide administrative functions needed throughout the agency ($87,600 in 1999-00 and $48,800 in 2000-01). In addition, the recommendation would enable the Office of Credit Unions (OCU) to acquire computer equipment for OCU examination staff through the state’s master lease program ($22,000 in 1999-00 and $63,600 in 2000-01).
3. CREDIT UNION INDIRECT COSTS
PR $296,000
Governor: Provide $148,000 annually to cover indirect costs of the Office of Credit Unions for administrative, information technology and other services from the Department’s Administrative Services Division.
4. OPTICAL IMAGING PROJECT
PR $280,000
Governor: Provide one-time financing of $173,500 in 1999-00 and $106,500 in 2000-01 to continue the optical imaging project started in the Division of Banking and expand it to the Mortgage Banking Unit, the Licensed Financial Services Unit and the Division of Savings Institutions. Optical imaging electronically scans and stores documents, which allows each document to be retrieved more quickly and viewed simultaneously by multiple users. Funding includes $21,000 in 1999-00 for portable scanning stations and $15,000 in 2000-01 for network scanners. Other costs include $152,500 in 1999-00 and $91,500 in 2000-01 for training, software, monitors and other equipment.
5. CONVERSION OF PROJECT POSITION
Governor: Convert the policy initiatives advisor position from project to permanent status. There is no fiscal effect of this provision, as the position authority and permanent funding are currently in the agency's base. However, this provision would adjust the Personnel Management Information System to match the agency's base, correcting a previous error.
6. ACCESS FEES FOR COMPUTER DATABASES
Governor: Authorize the Department to charge members of the public a fee for accessing or using the Department's databases or computer systems.
DFI is modernizing its Uniform Commercial Code (UCC) lien filing system, which is a system to maintain a statewide database of all UCC filings. The UCC lien filing system contains filings of financial statements submitted by banks, credit unions, small businesses, service companies and other lending institutions. The Department anticipates increased interest on the part of such institutions in filing forms electronically. In addition, DFI expects growing interest by members of the public in accessing the Department's databases. This provision would authorize the Department to charge fees when providing such services to members of the public.
The administration did not include an estimate of the fiscal impact of this provision in the bill, as the specific fees and the costs of the services to be provided in conjunction with such fees have not been determined. However, DFI has estimated that additional program revenue from such fees could amount to $250,000 annually.
[Bill Sections: 2351 thru 2353]
7. NAME CHANGE FOR DIVISION OF SAVINGS AND LOAN
Governor: Change the name of the Division of Savings and Loan in the Department of Financial Institutions to the Division of Savings Institutions. Provide that any action taken by the Division of Savings and Loan between July 1, 1996, and the bill's general effective date under the name of the Division of Savings Institutions would have the same force and effect in all respects as if the action had been taken under the name of the Division of Savings and Loan.
[Bill Sections: 30, 222, 645, 884, 885, 2166 thru 2169, 2337 thru 2341, 2344, 2345, 2347 thru 2350, 2357 thru 2359, 2927, 3088 and 3243]
