SS 103-20 Scope Statement

Statement of Scope

Department of Natural Resources

Rule No.:

CF 13-19

Relating to:

Safe Drinking Water Loan Program, Ch. NR 166, Wis. Adm. Code

Rule Type:

Permanent

1. Finding/nature of emergency (Emergency Rule only):

The rule will be proposed as a permanent rule.

2. Detailed description of the objective of the proposed rule:

Chapter NR 166 is the administrative rule for the Safe Drinking Water Loan Program (SDWLP), which provides loans to local units of government to finance drinking water infrastructure projects. There are four objectives for revising ch. NR 166, Wis. Adm. Code.

Objective 1: To update areas of ch. NR 166 that are either: (a) no longer in line with federal regulations, or (b) need efficiency, accuracy, or clarity changes.

Objective 2: To update the code to reflect statutory changes. Revisions to Wis. Stats. as part of the 2015-17 Biennial Budget (2015 Wis. Act 55) took effect on the same day that previous revisions to ch. NR 166 became effective, causing some parts of the code to be obsolete on the day it was published.

Objective 3: To codify new policies and procedures related to streamlining the SDWLP loan processes.

Objective 4: To lay the groundwork for implementing more innovative funding mechanisms to assist municipalities in financing non-traditional projects and some of DNR’s high priorities, such as lead service line replacement.

Additional improvements to ch. NR 166 may be identified by the Advisory Committees that will be convened to assist in the rule revision process.

3. Description of the existing policies relevant to the rule, new policies proposed to be included in the rule, and an analysis of policy alternatives:

A.

Existing policies relevant to the rule

Revisions to ch. NR 166 must maintain compliance with the following existing federal requirements, but the revised rule may include minor changes related to these requirements:



Conduct environmental review of the sites on which projects will take place. Some of the submittal requirements for conducting environmental reviews may be modified in the revised rule.



Comply with all federal crosscutting authorities and require loan recipients to comply with crosscutters. Crosscutting authorities include laws and Executive Orders such as the Davis-Bacon Act, Archaeological and Historic Preservation Act, Clean Water Act, Endangered Species Act, and the National Historic Preservation Act.



Prioritize projects each year giving top priority to projects that: (a) address the most serious risks to human health; (b) are necessary to ensure compliance with the requirements of the Safe Drinking Water Act; and (c) assist systems most in need, on a per household basis.



Require borrowers to meet requirements regarding the use of American iron and steel, federal wage rates, and the solicitation of disadvantaged business enterprises (DBEs) for participation in drinking water projects.

B.

New Policies Proposed to be Included in the Revised Rule

Through discussions with the SDWLP’s partners, customers, and Advisory Committees, new policies will be identified for inclusion into ch NR 166, including some policies related to financing projects in which lead services lines may be replaced. The department is collaborating with the Public Service Commission to develop effective ways to assist municipalities that need to remove lead from their systems. The policies being developed are very important in the protection of public health and should be codified in ch. NR 166 as municipalities will be working for a number of years to remove lead from their drinking water systems.

Revisions to ch. NR 166 will also include new policies related to the program’s streamlined priority scoring, application, and disbursement request processes.

C.

Analysis of Policy Alternatives

One alternative to handling federal and state law changes through code revision is to use annual Intended Use Plan for our federal capitalization grant to propose new policies. This alternative leaves customers wondering what changes are coming for the next financing year and is less vetted than a code revision.

4. Detailed explanation of statutory authority for the rule (including the statutory citation and language):

Sections 281.61(12)(a) and (b), Wis. Stats., contain the statutory authority for the Department of Natural Resources to promulgate rules for administration of the SDWLP.

The Environmental Improvement Fund, which includes the SDWLP, is administered cooperatively by the Wisconsin DNR and Department of Administration (DOA). Revisions to ch. NR 166 must also be coordinated with both ss. 281.59 and 281.61, Wis. Stats., to avoid conflict with these statutes and DOA policies and procedures.

5. Estimate of amount of time that state employees will spend developing the rule and of other resources necessary to develop the rule:

The program estimates that approximately 800 hours of existing staff time will be needed to complete the rule revision process. This time includes drafting rule language, legal review, holding the public hearing, and providing information to the Natural Resources Board and the Legislature.