Innovative Land Conservation and Water Quality Funding in

Delaware with State Revolving Fund Loan Programs

Frank Piorko, DirectorDNREC, Division of Watershed Stewardship

EPA SRF Loans Fund the Following Types of Projects:

A. Construction of municipal wastewater treatment facility improvements (POTW’s).

B. Implementation of Non-Point Source (NPS) projects.

C. Development and implementation of Estuary Comprehensive Conservation and Management Plans

B, and C are “Expanded Uses”

Delaware SRF Loan Incentive Programs

• Designed to provide incentives for innovative loan structure and leverage.

• Provides for land conservation and water quality improvements.

• Goal is to bring together traditional municipal loan borrowers and water quality project conservation partners.

Delaware State Revolving FundFinancing of Non-Traditional CWSRF Projects

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Land Conservation Loan Program

DDA CriteriaProperty must (1) be enrolled in Delaware’s Forestland Preservation Program (FPP) or enrolled in the Ag Lands Preservation Program and meet the requirements of the FPP and (2) have submitted an offer to sell their development rights.

Requirements of the FPP are:At least 10 (forested) acres in sizeLocated outside state-designated growth zoneZoned agricultural and no major subdivision recorded for the propertyHave a forest management plan prepared by a professional forester and updated every five yearsAll of the woodland on the property must be included and the land must remain forested (not cleared for cropland, structures, etc.)

Wastewater spray irrigation is permissible on the FPP parcel(s) utilizing best available treatment technology; however, all wastewater storage and treatment facilities must be located on lands other than the FPP properties.

Delaware State Revolving FundFinancing of Non-Traditional CWSRF Projects

• Kent County: CWSRF – Land Conservation Loan Program Project

– A Pollution Control Strategy was developed for Murderkill Watershed in Kent County to return the impaired waters to a condition of permitted use as required by the CWA. Due to the importance of the waste load allocation, the following projects were undertaken with the assistance from the CWSRF program:

• Double Run Wetlands Restoration and Nutrient Reduction Project - creation of a two acre wetland within the upper reaches of the Murderkill basin;

• MeadowBrook Acres – septic elimination project; and• LCLP Project – to purchase and systematically/permanently restore 255 acres

to their natural habitat (91 acres is currently cropland). In addition, the project will protect a riparian forest buffer of 164 acres from ever being developed and/or destroyed.

– The CWSRF interest rate for an existing closed $7.0 million loan was adjusted down from 3.609% to 1.0895%. This allowed the County to borrow an additional $1.0 million without increasing the annual loan debt service payments for the fee simple land purchase and the existing wastewater loan.

– The County entered into a LCLP Sponsorship Agreement with DNREC’s Division of Fish and Wildlife. The agreement describes the County’s responsibility/commitment to systematically/permanently restoring the land parcels to their natural habitat. The County paid DNREC a one-time $10,000 fee for perpetual monitoring and inspections of the land parcels. All loan closing costs were paid by the County.

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City of Wilmington Southbridge Project

• City leveraged a $30+M loan reduced rate to borrow an additional $4+M for the acquisition of 17 acres to be developed as wetlands restoration for the Southbridge – area.

• Large flood abatement water quality project in the City’s flood prone Christina River section of the City.

• SRF funding for estuary enhancement shall be limited to the development and implementation of the CCMP for an estuary designated as an “estuary of national significance” in accordance with CWA Section 320.

• Delaware Estuary• Inland Bays Estuary

CCMP Eligibility

“Comprehensive Conservation Management Plan” (CCMP) means a plan developed for a national estuary in accordance with the National Estuary Program established under the CWA. CCMPs contain recommended actions to (1) restore and maintain water quality; (2) maintain a balanced indigenous population of shellfish, fish, and wildlife; (3) allow recreational activities in the estuary; and (4) protect the beneficial uses of the estuary.

Watersheds

CCMPs Are Umbrella Plans

• They describe broad actions and goals– Strategic Plans– Watershed Implementation Plans– Regional Restoration Initiatives– Pollution Control Strategies

• Challenges –– We need to develop a level of planning

to directly fund specific implementation projects.

– Connect these projects to municipal needs.

More Focused

Water Quality Improvement Loan Program

• Five-year pilot program (up to $5 million per year – subject to availability)

• Wastewater and proposed WQILP projects must be on the CWSRF Project Priority List (PPL)

• Loan debt service payments for both wastewater and WQILP projects will be equal to wastewater project by itself for the term of the loan. • WQILP project must have demonstrated water quality improvement benefits and be managed for the life of the improvement. • WQILP project applicants must enter into a Water Quality Improvement Agreement with the DNREC‘s Division of Watershed Stewardship.

Eligible Projects

• Implementation of green streets (combination of infrastructure practices in transportation rights-of-way) for new development, redevelopment or retrofits;

• Implementation of wet weather management systems for parking areas which include: the incremental cost of porous pavement, bioretention, trees, green roofs and other practices that mimic natural hydrology and reduce effective.

• Establishment and restoration of riparian buffers, floodplains, wetlands, living shorelines, and other natural features.

• The water quality portion of projects that employ development and redevelopment practices that preserve or restore site hydrologic processes through sustainable landscaping and site design;

As Examples

Silver Lake Sediment Management Project

What

CIB/Rehoboth

Who Silver Lake Rehoboth

CIB /DNREC/Sussex County/Private Landowner

Who

Ag Wetland Restoration

What

Where

Benefits: Reduced Nitrogen, Phosphorus, SedimentImproved Habitat, Increase DO, Reduce Flooding

Sussex CountyWhere

Benefits: Reduced Nitrogen, Phosphorus, SedimentImproved Habitat, Increase DO, Reduce Flooding

As Examples

Riparian Buffer Project

What

PDE /BVA/COW

Who

Brandywine Creek

Where

Mussel Restoration Project

What

PDE/ WCC/CON

Who White Clay CreekWhere

Benefits: Reduced Nitrogen, Phosphorus, SedimentImproved Habitat, Increase DO, Protect Wilmington’s Drinking Water Supply

Benefits: Reduced Nitrogen, Phosphorus, SedimentImproved Habitat, Increase DO, Protect Newark’s Drinking Water Supply

Delaware State Revolving FundFinancing of Non-Traditional CWSRF Projects

Municipality and implementing partner enter into sponsorship agreement

CWSRF Provides funding to Municipality for wastewater

treatment & conservation projects

Municipality provides CWSRF funding for sponsored conservation project

Municipality repays low-interest loan to CWSRF

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CWSRF

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Municipal Sponsor

Conservation Project Implementing Partner

CIFA SRF 2012 Workshop 15

What’s Proposed?

• Grant from the Delaware Water Infrastructure Council to develop a Project Registry using PDE’s model.

• Identify linkages between good projects and municipal/county needs.

• Develop a concept (30% design) plan for one project in each Estuary Program.

• Evaluate and further develop the sponsorship program.

• Oversight of project by FAB and Division of Watershed Stewardship.