Federal Register / Vol. 82, No. 6 / Tuesday, January 10, 2017 / Proposed Rules 2933 

1 81 FR 91822, https://www.federalregister.gov/ 

documents/2016/12/19/2016–30194/creditassistance-for-water-infrastructure-projects 

Broadcast Notice to Mariners on the day 

of the event. 

Spectator vessel means any vessel or 

person, including human-powered craft, 

which is not designated by the sponsor 

as a support vessel. 

Support vessel means a vessel, 

including jet skis, which is designated 

and conspicuously marked by the 

sponsor to provide direct support to the 

competitors. Support vessels must be 

pre-designated and approved to serve as 

such for this event by the Officer in 

Charge, Marine Inspection (OCMI) prior 

to the competition. 

Zone 1 means the competition area 

within the regulated area. Zone 1 will 

generally be located to the northwest of 

a line drawn between Sail Rock 

(37°29′34′′ N., 122°30′02′′ W.) and 

37°29′10.410′′ N., 122°30′21.904′′ W. 

Zone 2 means the area within the 

regulated area where the Coast Guard 

may direct the movement of all vessels, 

including restricting vessels from this 

area. Zone 2 will generally be located to 

the southeast of a line drawn between 

Sail Rock (37°29′34′′ N., 122°30′02′′ W.) 

and 37°29′10.410′′ N., 122°30′21.904′′ W. 

(d) Special local regulations. The 

following regulations apply between 6 

a.m. and 6 p.m. on the competition day. 

(1) Only support vessels may be 

authorized by the Patrol Commander 

(PATCOM) to enter Zone 1 during the 

competition. 

(2) Entering the water in Zone 1 by 

any person other than the competitors is 

prohibited. Competitors may enter the 

water in Zone 1 from authorized 

support vessels only. 

(3) Spectator vessels and support 

vessels within Zone 2 must maneuver as 

directed by PATCOM. Given the 

changing nature of the surf in the 

vicinity of the competition, PATCOM 

may close Zone 2 to all vessels due to 

hazardous conditions. Due to weather 

and sea conditions, the Captain of the 

Port may deny access to Zone 2 and the 

remainder of the regulated area to all 

vessels other than competitors and 

support vessels on the day of the event 

(4) Entering the water in Zone 2 by 

any person is prohibited. 

(5) Rafting and anchoring of vessels 

are prohibited within the regulated area. 

(6) Only vessels authorized by the 

PATCOM will be permitted to tow other 

watercraft within the regulated area. 

(7) Spectator and support vessels in 

Zones 1 and 2 must operate at speeds 

which will create minimum wake, in 

general, 7 miles per hour or less. 

(8) If granted permission to enter the 

regulated area, when hailed or signaled 

by the PATCOM by a succession of 

sharp, short signals by whistle or horn, 

the hailed vessel must come to an 

immediate stop and comply with the 

lawful directions issued. Failure to 

comply with a lawful direction may 

result in additional operating 

restrictions, citation for failure to 

comply, or both. 

(9) During the events, vessel operators 

may contact the PATCOM on VHF–FM 

channel 16. 

Dated: December 13, 2016. 

Anthony J. Ceraolo, 

Captain, U.S. Coast Guard, Captain of the 

Port San Francisco. 

[FR Doc. 2017–00175 Filed 1–9–17; 8:45 am] 

BILLING CODE 9110–04–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

[FRL 9957–79–OW] 

40 CFR Part 35 

Notice of Funding Availability (NOFA) 

for Applications for Credit Assistance 

Under the Water Infrastructure Finance 

and Innovation Act (WIFIA) Program 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Notice of funding availability. 

SUMMARY: In the Further Continuing and 

Security Assistance Appropriations Act, 

2017, signed by the President on 

December 10, 2016, Congress provided 

$20 million in budget authority for the 

Water Infrastructure Finance and 

Innovation Act of 2014 (WIFIA) 

program. This funding covers the 

Federal government’s anticipated cost of 

providing a much larger amount of 

credit assistance. Environmental 

Protection Agency (EPA) estimates that 

current budget authority may provide 

more than $1 billion in credit assistance 

and may finance over $2 billion in water 

infrastructure investment. The purpose 

of this notice of funding availability 

(NOFA) is to solicit letters of interest 

(LOIs) from prospective borrowers 

seeking credit assistance from EPA. 

EPA will evaluate and select proposed 

projects described in the LOIs using the 

selection criteria established in 

regulation at 40 CFR 35.10055,1 and 

further described in this NOFA as well 

as the WIFIA program handbook. This 

NOFA establishes relative weights that 

will be used in the current LOI 

submittal period for the selection 

criteria and outlines the process that 

applicants must follow to be considered 

for WIFIA credit assistance. 

In addition, EPA reserves the right to 

make additional awards under this 

announcement, consistent with Agency 

policy and guidance, if additional 

funding is available after the original 

selections are made. 

DATES: EPA will collect LOIs in two 

selection rounds in FY 2017. The first 

LOI submittal period will begin on 

January 10, 2017, and end at midnight 

in the time zone of the prospective 

borrower on April 10, 2017. The second 

LOI submittal period, if needed, will 

begin on August 1, 2017 and end at 

midnight in the time zone of the 

prospective borrower on September 29, 

2017. 

ADDRESSES: Prospective borrowers 

should submit all LOIs electronically 

via email at: wifia@epa.gov. Prospective 

borrowers will receive a confirmation 

email and are advised to request a 

return receipt to confirm transmission. 

Only LOIs received by email, as 

provided above, shall be considered for 

funding. 

Prospective borrowers can access 

additional information, including the 

WIFIA program handbook and 

application materials, on the WIFIA 

Web site: https://www.epa.gov/wifia/. 

SUPPLEMENTARY INFORMATION: In the first 

selection round, EPA will make 

available the full $17 million of budget 

authority appropriated for the WIFIA 

program to provide credit assistance. 

This $17 million in Federal funding can 

help finance total project costs of more 

than $2 billion. If funding remains after 

the first selection round, EPA will hold 

a second round. The second LOI 

submittal period, if needed, will begin 

on August 1, 2017 and end at midnight 

in the time zone of the prospective 

borrower on September 29, 2017. Late 

proposals will not be considered for 

funding. 

EPA will announce the amount 

available in the second selection round 

through a notice in the Federal Register, 

as well as on EPA’s WIFIA program Web 

site. In the event that EPA changes the 

application or selection process to 

incorporate best practices from the 

initial round, a new NOFA will be 

published. 

For a project to be considered during 

a selection round, EPA must receive a 

complete LOI electronically via email 

before the corresponding deadline listed 

above. EPA is only able to accept emails 

of 25 MB or smaller with unzipped 

attachments. If necessary due to size 

restrictions, prospective borrowers may 

submit attachments separately, as long 

as they are received by the deadline. 

When writing a LOI, prospective 

borrowers must also fill out the form 


pmangrum on DSK3GDR082PROD with PROPOSALS
2934 Federal Register / Vol. 82, No. 6 / Tuesday, January 10, 2017 / Proposed Rules 

2This estimated loan volume is provided for 

reference only. Consistent with the Federal Credit 

Reform Act of 1990 and the requirements of the 

Office of Management and Budget, the actual 

subsidy cost of providing credit assistance is based 

on individual project characteristics and calculated 

on a project-by-project basis. Thus, actual lending 

capacity may vary. 

and follow the guidelines contained on 

the WIFIA program Web site: https://

www.epa.gov/wifia/. Prospective 

borrowers should provide the LOI and 

any attachments as searchable PDF files, 

whenever possible, to facilitate EPA’s 

review. Additionally, prospective 

borrowers should ensure that financial 

information, including the pro forma 

financial statement, is in a formulabased Microsoft Excel document 

whenever possible. Section V of this 

NOFA provides additional details on 

the contents of the LOIs. 

EPA will invite final applications 

from prospective borrowers whose 

project proposals are selected for 

continuation in the application process. 

EPA must receive final applications 

within 365 days of the invitation to 

apply. If EPA does not receive an 

application within this timeframe, it is 

considered withdrawn and the 

prospective borrower will need to 

resubmit a LOI to be considered in any 

subsequent rounds of project selection. 

Table of Contents 

I. Background 

II. Program Funding 

III. Eligibility Requirements 

IV. Types of Credit Assistance 

V. Letters of Interest and Applications 

VI. Fees 

VII. Selection Criteria 

I. Background 

Congress enacted WIFIA as part of the 

Water Resources Reform and 

Development Act of 2014 (WRRDA). 

Codified at 33 U.S.C. 3901–3914, as 

amended by sec. 5008 of the Water 

Infrastructure Improvements for the 

Nation (WIIN) Act, signed into law by 

the President on December 16, 2016, 

WIFIA establishes a new federal credit 

program for water infrastructure projects 

to be administered by EPA. WIFIA 

authorizes EPA to provide federal credit 

assistance in the form of secured (direct) 

loans or loan guarantees for eligible 

water infrastructure projects. 

The WIFIA program’s mission is to 

accelerate investment in our nation’s 

water and wastewater infrastructure by 

providing long-term, low-cost, 

supplemental credit assistance under 

customized terms to creditworthy 

drinking water and wastewater 

infrastructure projects of national and 

regional significance. 

II. Program Funding 

Congress appropriated $20 million in 

funding to cover the subsidy cost of 

providing WIFIA credit assistance. The 

subsidy cost represents the Federal 

government’s risk that the loan may not 

be paid back, and since EPA anticipates 

that on average for the water industry, 

the risk is relatively low, this funding 

can be leveraged into a much larger 

amount of credit assistance. EPA 

estimates that this appropriation will 

allow it to provide approximately $1 

billion 2 in long-term, low-cost financing 

to water and wastewater projects and 

accelerate more than $2 billion in 

infrastructure investment around the 

country. 

Recognizing the need that exists in 

both small and large communities to 

invest in infrastructure, Congress 

stipulated in WIFIA that EPA set aside 

15% of the budget authority 

appropriated each year for small 

communities, defined as systems that 

serve a population of less than 25,000. 

Of the funds set aside, any amount not 

obligated by June 1 of the fiscal year for 

which budget authority is set aside may 

be used for any size community. 

Regardless of whether EPA obligates 

these funds by June 1 of the fiscal year 

for which budget authority is set aside, 

EPA will endeavor to use 15% of its 

budget authority for small communities. 

In addition to assisting both large and 

small projects and communities, WIFIA 

will be an attractive borrowing 

mechanism for a variety of different 

borrower and credit types. EPA 

anticipates that WIFIA’s low cost 

combined with the debt structuring 

flexibilities offered by the program will 

be of benefit to municipalities, private 

entities, project financings, and to the 

State Revolving Fund programs. 

III. Eligibility Requirements 

The WIFIA statute and implementing 

rules set forth eligibility requirements 

for prospective borrowers, projects, and 

project costs. The requirements outlined 

below are described in greater detail in 

the WIFIA program handbook. 

A. Eligible Applicants 

Prospective borrowers must be one of 

the following in order to be eligible for 

WIFIA credit assistance: 

(i) A corporation; 

(ii) A partnership; 

(iii) A joint venture; 

(iv) A trust; 

(v) A Federal, State, or local 

governmental entity, agency, or 

instrumentality; 

(vi) A tribal government or a 

consortium of tribal governments; or 

(vii) A State infrastructure financing 

authority. 

B. Eligible Projects 

The WIFIA statute authorizes EPA to 

provide credit assistance for a wide 

variety of projects. Projects must be one 

of the following in order to be eligible 

for WIFIA credit assistance: 

(i) One or more activities that are 

eligible for assistance under section 

603(c) of the Federal Water Pollution 

Control Act (33 U.S.C. 1383(c)), 

notwithstanding the public ownership 

requirement under paragraph (1) of that 

subsection; 

(ii) One or more activities described 

in section 1452(a)(2) of the Safe 

Drinking Water Act (42 U.S.C. 300j– 

12(a)(2)); 

(iii) A project for enhanced energy 

efficiency in the operation of a public 

water system or a publicly owned 

treatment works; 

(iv) A project for repair, rehabilitation, 

or replacement of a treatment works, 

community water system, or aging water 

distribution or waste collection facility 

(including a facility that serves a 

population or community of an Indian 

reservation); 

(iv) A brackish or sea water 

desalination project, including chloride 

control, a managed aquifer recharge 

project, a water recycling project, or a 

project to provide alternative water 

supplies to reduce aquifer depletion; 

(v) A project to prevent, reduce, or 

mitigate the effects of drought, 

including projects that enhance the 

resilience of drought-stricken 

watersheds; 

(vi) Acquisition of real property or an 

interest in real property— 

(a) If the acquisition is integral to a 

project described in paragraphs (i) 

through (v); or 

(b) Pursuant to an existing plan that, 

in the judgment of the Administrator, 

would mitigate the environmental 

impacts of water resources 

infrastructure projects otherwise eligible 

for assistance under this section; 

(vii) A combination of projects, each 

of which is eligible under paragraph (i) 

or (ii), for which a State infrastructure 

financing authority submits to the 

Administrator a single application; or 

(viii) A combination of projects 

secured by a common security pledge, 

each of which is eligible under 

paragraph (i), (ii), (iii), (iv), (v), or (vi), 

for which an eligible entity, or a 

combination of eligible entities, submits 

a single application. 

C. Eligible Costs 

As defined under 33 U.S.C. 3906 and 

described in the WIFIA program 

handbook, eligible project costs are 

costs associated with the following 

activities: 


pmangrum on DSK3GDR082PROD with PROPOSALS
Federal Register / Vol. 82, No. 6 / Tuesday, January 10, 2017 / Proposed Rules 2935 

(i) Development-phase activities, 

including planning, feasibility analysis 

(including any related analysis 

necessary to carry out an eligible 

project), revenue forecasting, 

environmental review, permitting, 

preliminary engineering and design 

work, and other preconstruction 

activities; 

(ii) Construction, reconstruction, 

rehabilitation, and replacement 

activities; 

(iii) The acquisition of real property 

or an interest in real property (including 

water rights, land relating to the project, 

and improvements to land), 

environmental mitigation (including 

acquisitions pursuant to section 5026(7) 

of the statute), construction 

contingencies, and acquisition of 

equipment; and 

(iv) Capitalized interest necessary to 

meet market requirements, reasonably 

required reserve funds, capital issuance 

expenses, and other carrying costs 

during construction. Capitalized interest 

on WIFIA credit assistance may not be 

included as an eligible project cost. 

D. Threshold Requirements 

In order for a project to be considered 

for WIFIA credit assistance, a project 

must meet the following six criteria: 

(i) The project and obligor shall be 

creditworthy; 

(ii) A project shall have eligible 

project costs that are reasonably 

anticipated to equal or exceed $20 

million, or for a project eligible under 

paragraphs (2) or (3) of 33 U.S.C. 3905 

serving a community of not more than 

25,000 individuals, project costs that are 

reasonably anticipated to equal or 

exceed $5 million; 

(iii) Project financing shall be 

repayable, in whole or in part, from 

State or local taxes, user fees, or other 

dedicated revenue sources that also 

secure the senior project obligations of 

the project; shall include a rate 

covenant, coverage requirement, or 

similar security feature supporting the 

project obligations; and may have a lien 

on revenues subject to any lien securing 

project obligations; 

(iv) In the case of a project that is 

undertaken by an entity that is not a 

State or local government or an agency 

or instrumentality of a State or local 

government, or a tribal government or 

consortium of tribal governments, the 

project that the entity is undertaking 

shall be publicly sponsored. 

(v) The applicant shall have 

developed an operations and 

maintenance plan that identifies 

adequate revenues to operate, maintain, 

and repair the project during its useful 

life. 

E. Federal Requirements 

All projects receiving WIFIA 

assistance must comply with Federal 

requirements and regulations, including 

(but not limited to): 

(i) American Iron and Steel 

Requirement, 33 U.S.C. 3914, https://

www.epa.gov/cwsrf/state-revolvingfund-american-iron-and-steel-aisrequirement; 

(ii) Labor Standards, 33 U.S.C. 1372, 

https://www.dol.gov/whd/govcontracts/ 

dbra.htm; 

(iii) National Environmental Policy 

Act of 1969, 42 U.S.C. 4321 et seq., 

https://www.epa.gov/nepa; 

(iv) Floodplain Management, 

Executive Order 11988, 42 FR 26951, 

May 24, 1977, as amended by Executive 

Order 13690, 80 FR 6425, February 4, 

2015, https://www.archives.gov/federalregister/codification/executive-order/ 

11988.html, https://

www.whitehouse.gov/the-press-office/ 

2015/01/30/executive-orderestablishing-federal-flood-riskmanagement-standard-and-https://

www.fema.gov/media-library/assets/ 

documents/110377; 

(v) Archeological and Historic 

Preservation Act, 16 U.S.C. 469–469c, 

https://www.nps.gov/archeology/tools/ 

laws/ahpa.htm; 

(vi) Clean Air Act, 42 U.S.C. 7401 et 

seq., https://www.epa.gov/clean-air-actoverview; 

(vii) Clean Water Act, 33 U.S.C. 1251 

et seq., https://www.epa.gov/aboutepa/ 

about-office-water; 

(viii) Coastal Barrier Resources Act, 

16 U.S.C. 3501 et seq., https://

www.fws.gov/ecological-services/ 

habitat-conservation/cbra/Act/ 

index.html; 

(ix) Coastal Zone Management Act, 16 

U.S.C. 1451 et seq., https://

coast.noaa.gov/czm/about/; 

(x) Endangered Species Act, 16 U.S.C. 

1531 et seq., https://www.fws.gov/ 

endangered/; 

(xi) Federal Actions to Address 

Environmental Justice in Minority 

Populations and Low-Income 

Populations, Executive Order 12898, 59 

FR 7629, February 16, 1994, https://

www.archives.gov/files/federal-register/ 

executive-orders/pdf/12898.pdf; 

(xii) Protection of Wetlands, 

Executive Order 11990, 42 FR 26961, 

May 25, 1977, as amended by Executive 

Order 12608, 52 FR 34617, September 

14, 1987, https://www.epa.gov/cwa-404; 

(xiii) Farmland Protection Policy Act, 

7 U.S.C. 4201 et seq., https://

www.nrcs.usda.gov/wps/portal/nrcs/ 

detail/?cid=nrcs143_008275; 

(xiv) Fish and Wildlife Coordination 

Act, 16 U.S.C. 661–666c, as amended, 

https://www.fws.gov/; 

(xv) Magnuson-Stevens Fishery 

Conservation and Management Act, 16 

U.S.C. 1801 et seq., http://

www.nmfs.noaa.gov/sfa/laws_policies/ 

msa/; 

(xvi) National Historic Preservation 

Act, 16 U.S.C. 470 et seq., https://

www.nps.gov/archeology/tools/laws/ 

NHPA.htm; 

(xvii) Safe Drinking Water Act, 42 

U.S.C. 300f et seq., https://

www.epa.gov/ground-water-anddrinking-water; 

(xviii) Wild and Scenic Rivers Act, 16 

U.S.C. 1271 et seq., https://rivers.gov/; 

(xix) Debarment and Suspension, 

Executive Order 12549, 51 FR 6370, 

https://www.archives.gov/federalregister/codification/executive-order/ 

12549.html; 

(xx) Demonstration Cities and 

Metropolitan Development Act, 42 

U.S.C. 3301 et seq., as amended, and 

Executive Order 12372, 47 FR 30959, 

http://portal.hud.gov/hudportal/ 

HUD?src=/program_offices/comm_

planning; 

(xxi) Drug-Free Workplace Act, 41 

U.S.C. 8101 et seq., https://

webapps.dol.gov/elaws/asp/drugfree/ 

screen4.htm; 

(xxii) New Restrictions on Lobbying, 

31 U.S.C. 1352, https://www.epa.gov/ 

grants/lobbying-and-litigationinformation-federal-grants-cooperativeagreements-contracts-and-loans; 

(xxiii) Prohibitions relating to 

violations of the Clean Water Act or 

Clean Air Act with respect to Federal 

contracts, grants, or loans under 42 

U.S.C. 7606 and 33 U.S.C. 1368, and 

Executive Order 11738, 38 FR 25161, 

September 12, 1973, https://

www.archives.gov/federal-register/ 

codification/executive-order/ 

11738.html; 

(xxiv) The Uniform Relocation 

Assistance and Real Property 

Acquisition Policies Act of 1970, 42 

U.S.C. 4601 et seq., https://

www.gpo.gov/fdsys/pkg/FR-2005-01-04/ 

pdf/05-6.pdf; 

(xxv) Age Discrimination Act, 42 

U.S.C. 6101 et seq., https://

www.eeoc.gov/laws/statutes/adea.cfm; 

(xxvi) Equal Employment 

Opportunity, Executive Order 11246, 30 

FR 12319, September 28, 1965, https:// 

www.dol.gov/ofccp/regs/compliance/ 

ca_11246.htm; 

(xxvii) Section 13 of the Clean Water 

Act, Pub. L. 92–500, codified in 42 

U.S.C. 1251, https://www.epa.gov/ocr/ 

section-13-federal-water-pollutioncontrol-act-amendments-1972; 

(xxviii) Section 504 of the 

Rehabilitation Act, 29 U.S.C. 794, 

supplemented by Executive Orders 

11914, 41 FR 17871, April 29, 1976 and 


pmangrum on DSK3GDR082PROD with PROPOSALS
2936 Federal Register / Vol. 82, No. 6 / Tuesday, January 10, 2017 / Proposed Rules 

11250, 30 FR 13003, October 13, 1965, 

https://www.epa.gov/ocr/section-504- 

rehabilitation-act-1973; 

(xxix) Title VI of the Civil Rights Act 

of 1964, 42 U.S.C. 2000d et seq., https:// 

www.epa.gov/environmentaljustice/titlevi-and-environmental-justice; 

(xxx) Participation by Disadvantaged 

Business Enterprises in Procurement 

under Environmental Protection Agency 

(EPA) Financial Assistance Agreements, 

73 FR 15904, https://www.epa.gov/ 

resources-small-businesses. 

Detailed information about some of 

these requirements is outlined in the 

WIFIA program handbook. Further 

information can be found at the links 

above. 

IV. Types of Credit Assistance 

Under WIFIA, EPA is permitted to 

provide credit assistance in the form of 

secured (direct) loans or loan 

guarantees. The maximum amount of 

WIFIA credit assistance to a project is 

49 percent of eligible project costs. Each 

prospective borrower will list the 

estimated total capital costs of the 

project, broken down by activity type 

and differentiating between eligible 

project costs and ineligible project costs 

in the LOI and application. 

V. Letters of Interest and Applications 

Each prospective borrower will be 

required to submit a LOI and, if invited, 

an application to EPA in order to be 

considered for approval. This section 

describes the LOI submission and 

application submission. 

A. Letter of Interest 

Applicants seeking a WIFIA loan 

must submit a LOI describing the 

project fundamentals and addressing the 

WIFIA selection criteria. 

The primary purpose of the LOI is to 

provide adequate information to EPA to: 

(i) Validate the eligibility of the 

prospective borrower and the 

prospective project, (ii) perform a 

preliminary creditworthiness 

assessment, (iii) perform a preliminary 

engineering feasibility assessment, and 

(iv) evaluate the project against the 

selection criteria and identify which 

projects EPA will invite to submit 

applications. Prospective borrowers are 

encouraged to review the WIFIA 

program handbook to help create the 

best justification possible for the project 

and a cohesive and comprehensive LOI 

submittal. 

Prospective applicants should utilize 

the LOI form on the WIFIA Web site and 

ensure that sufficient detail about the 

project is provided for EPA’s review. 

EPA will notify a prospective applicant 

if a project is deemed ineligible as 

described in Section III of this NOFA 

and based on the information provided 

in the LOI. 

Below is guidance on what should be 

included in the LOI. 

A. Prospective Borrower Information. 

In this section, the prospective borrower 

describes its project’s organizational 

structure, financial condition and 

experience, and project’s readiness to 

proceed. Also, the prospective borrower 

provides basic information such as its 

address, Web site, Dun and Bradstreet 

Data Universal Number System (DUNS) 

number, and employer/taxpayer 

identification number numbers. As part 

of the description of its financial 

condition, the prospective borrower 

should include the year-end audited 

financial statements for the past three 

years, as available. 

In the case of a project that is 

undertaken by an entity that is not a 

State or local government or an agency 

or instrumentality of a State or local 

government, or a tribal government or 

consortium of tribal governments, the 

project that the entity is undertaking 

must be publicly sponsored. Public 

sponsorship means that the recipient 

can demonstrate, to the satisfaction of 

the EPA, that the project applicant has 

consulted with the affected State, local, 

or tribal government in which the 

project is located, or is otherwise 

affected by the project and that such 

government supports the proposed 

project. A prospective borrower can 

show support by including a certified 

letter signed by the approving 

municipal department or similar 

agency, mayor or other similar 

designated authority, local ordinance, or 

any other means by which local 

government approval can be evidenced. 

B. Project Plan. The prospective 

borrower provides a general description 

of the project, including its location, 

population served, purpose, design 

features, estimated capital cost, and 

development schedule. The prospective 

borrower describes how the project can 

be categorized as one of the project 

types eligible for WIFIA assistance as 

described in the program handbook. The 

prospective borrower includes other 

relevant information that could affect 

the development of the project, such as 

community support, pending 

legislation, or litigation. In this section, 

the prospective borrower summarizes 

the status of the project’s environmental 

review, engineering report, and other 

approvals or analyses that are integral to 

the project’s development. 

C. Project Operations and 

Maintenance Plan. The prospective 

borrower describes its plan for 

operating, maintaining, and repairing 

the project post-completion, discusses 

the sources of revenue used to finance 

these activities, and provides an 

estimate of the useful life of the project. 

D. Financing Plan. The prospective 

borrower details the proposed sources 

and uses of funds for the project and 

states the type and amount of credit 

assistance it is seeking from the WIFIA 

program. The discussion of proposed 

financing should identify the source(s) 

of revenue or other security that would 

be pledged to the WIFIA assistance. 

Additionally, the prospective borrower 

describes the credit characteristics of 

the project and how the senior 

obligations of the project will achieve an 

investment-grade rating as well as the 

anticipated rating on the WIFIA 

instrument. It also includes a summary 

financial pro forma as well as revenue 

and expense projections for the life of 

the WIFIA debt. 

E. Selection Criteria. The prospective 

borrower describes the potential policy 

benefits achieved through the use of 

WIFIA assistance with respect to each of 

the WIFIA program selection criteria. 

These criteria and their weights are 

enumerated in Section VII of this NOFA 

and further explained in the program 

handbook. 

F. Contact Information.The 

prospective borower identifies the point 

of contact with whom the WIFIA 

program should communicate regarding 

the LOI. For the purpose of completing 

its evaluation, WIFIA program staff may 

contact a prospective borrower 

regarding specific information in the 

LOI. 

G. Certifications. The prospective 

borrower certifies that it will abide by 

all applicable laws and regulations, 

including NEPA, the Federal Water 

Pollution Control Act, the American 

Iron and Steel requirements, and 

Federal labor standards, among others if 

selected to receive funding. 

H. SRF Notification. The prospective 

borrower acknowledges that EPA will 

notify the State infrastructure financing 

authority in the State in which the 

project is located that it submitted a LOI 

and provide the submitted LOI and 

source documents to that authority. The 

prospective borrower may opt out of 

having its LOI and source documents 

shared. 

B. Application 

After the EPA concludes its 

evaluation of the LOIs, a selection 

committee will invite prospective 

borrowers to apply based on 

preliminary engineering feasibility 

findings, the preliminary 

creditworthiness assessment, the 

amount of budget authority necessary to 


pmangrum on DSK3GDR082PROD with PROPOSALS
Federal Register / Vol. 82, No. 6 / Tuesday, January 10, 2017 / Proposed Rules 2937 

provide WIFIA credit assistance, and 

the scoring of the selection criteria in 

accordance with Section VII of this 

NOFA. 

Applications must be submitted using 

the form provided on the WIFIA Web 

site: https://www.epa.gov/wifia/. The 

purpose of the application is to provide 

the WIFIA program with the materials 

necessary to underwrite the loan. 

Underwriting performed by the WIFIA 

team will include a thorough evaluation 

of the project’s plan of finance and 

underlying economics, including a 

detailed assessment of the project’s cash 

flow and proposed credit terms. The 

WIFIA team will review the inputs and 

assumptions in the financing plan, the 

revenue and expenditures in the 

financing plan, the project’s ability to 

meet WIFIA loan repayment obligations, 

and project risks and mitigants, among 

other things. An application fee may be 

required, as determined by the final fee 

rule. 

EPA will require a preliminary rating 

opinion letter indicating that the 

project’s senior debt obligations have 

the potential to attain an investmentgrade rating, prior to approving a project 

for credit assistance. To demonstrate 

this potential, each application must 

include a preliminary rating opinion 

letter from a Nationally Recognized 

Statistical Rating Organization (NRSRO) 

that addresses the creditworthiness of 

the senior debt obligations funding the 

project (i.e., debt obligations which have 

a lien senior to that of the WIFIA credit 

instrument on the pledged security) and 

the default risk of the WIFIA loan. The 

preliminary rating opinion letter must 

be based on the financing structure 

proposed by the prospective borrower, 

must conclude that there is a reasonable 

probability for the senior debt 

obligations to receive an investment 

grade rating, and should opine on the 

default risk of the WIFIA credit 

assistance itself. If the WIFIA credit 

assistance is proposed as the senior 

obligation, then it must receive the 

investment grade rating. A project that 

does not demonstrate the potential for 

its senior obligations to receive an 

investment grade rating will not be 

considered for a WIFIA loan. 

Finally, prior to execution of a WIFIA 

loan agreement, each prospective 

borrower must obtain two investment 

grade ratings on its project’s senior debt 

obligations (which may be the WIFIA 

credit instrument) and revised opinions 

on the default risk of the WIFIA loan. 

Detailed information requirements for 

the application are listed in the 

application form, and are described in 

the WIFIA program handbook. 

VI. Fees 

There is no fee to submit a LOI. EPA 

has proposed in ‘‘Fees for Water 

Infrastructure Project Applications 

under WIFIA’’, found at Docket ID No. 

EPA–HQ–OW–2016–0568 at http://

www.regulations.gov, that each invited 

applicant must submit, concurrent with 

its application, a non-refundable 

Application Fee of $25,000 for projects 

serving communities of not more than 

25,000 individuals or $100,000 for all 

other projects. Applications will not be 

evaluated until the Application Fee is 

paid. For successful applicants, this fee 

will be credited toward final payment of 

a Credit Processing Fee, assessed 

following financial close, to reimburse 

the EPA for actual engineering, 

financial, and legal costs. In the event a 

final credit agreement is not executed, 

the borrower is still required to 

reimburse EPA for the costs incurred. 

Typically, the amount of this credit 

processing fee is expected to range 

between $350,000 and $700,000, 

although it can be greater for projects 

that require complex financial 

structures and extended negotiations or 

lower for projects that require simpler 

financial structures and shorter 

negotiations. 

Borrowers may finance any of the fees 

described above with WIFIA credit 

assistance, in accordance with recent 

amendments to WIFIA found in section 

5008 of the Water Infrastructure 

Improvements for the Nation (WIIN) 

Act. Borrowers may not finance any 

other expenses associated with the 

application process, such as charges 

associated with obtaining the required 

preliminary rating opinion letter, with 

WIFIA credit assistance. 

VII. Selection Process and Criteria 

This section specifies the criteria and 

process that EPA will use to evaluate 

and award applications for WIFIA 

assistance. 

After EPA concludes its evaluation of 

the LOIs, a selection committee will 

invite prospective borrowers to apply 

based on the scoring of the selection 

criteria, the initially estimated amount 

of budget authority consumed by the 

project, the preliminary 

creditworthiness assessment, and the 

preliminary engineering feasibility 

assessment. In addition, the selection 

committee will take into consideration 

geographic and project diversity when 

identifying which projects should be 

invited to submit complete applications. 

To maintain consistency throughout 

the evaluation process, the criteria will 

receive a score on the rating scale of 1– 

5, 1 being the lowest. Each criterion is 

weighted based upon EPA’s mission and 

priorities as well as factors influencing 

the successful implementation of the 

WIFIA program. There is no threshold 

score that must be achieved in order to 

be selected. Rather, the selection 

committee will weigh each of the factors 

outlined above in making final 

determinations. 

An invitation to apply for WIFIA 

credit assistance does not guarantee 

EPA’s approval, which remains subject 

to a project’s continued eligibility, 

including creditworthiness, the 

successful negotiation of terms 

acceptable to EPA, and the availability 

of funds at the time at which all 

necessary recommendations and 

evaluations have been completed. 

However, the purpose of EPA’s LOI 

review is to pre-screen prospective 

borrowers to the extent practicable. In 

doing this, it is expected that EPA will 

only invite projects to apply if it 

anticipates that those projects are able to 

obtain WIFIA credit assistance. 

The selection criteria incorporate 

statutory eligibility requirements as well 

as EPA priorities. EPA has identified the 

following project priorities for the LOI 

submittal period: 

(i) Adaptation to extreme weather and 

climate change including enhanced 

infrastructure resiliency, water recycling 

and reuse, and managed aquifer 

recovery; 

(ii) Enhanced energy efficiency of 

treatment works, public water systems, 

and conveyance systems, including 

innovative, energy efficient nutrient 

treatment; 

(iii) Green infrastructure; and 

(iv) Repair, rehabilitation, and 

replacement of infrastructure and 

conveyance systems. 

EPA’s priorities reflect water sector 

challenges that require innovative tools 

to assist municipalities in managing and 

adapting to our most pressing public 

health and environmental challenges. 

These priorities are reflected in the 

relative weights of the thirteen selection 

criteria below, described in greater 

detail in the WIFIA program handbook. 

Listed in order of relative weight for 

this LOI submittal period, the WIFIA 

selection criteria are as follows: 

(i) The extent to which the project is 

nationally or regionally significant, with 

respect to the generation of economic 

and public health benefits: 10 percent. 

(ii) The likelihood that assistance 

under WIFIA would enable the project 

to proceed at an earlier date than the 

project would otherwise be able to 

proceed: 5 percent. 

(iii) The extent to which the project 

uses new or innovative approaches such 

as the use of energy efficient parts and 


pmangrum on DSK3GDR082PROD with PROPOSALS
2938 Federal Register / Vol. 82, No. 6 / Tuesday, January 10, 2017 / Proposed Rules 

systems, or the use of renewable or 

alternate sources of energy; green 

infrastructure; and the development of 

alternate sources of drinking water 

through desalination, aquifer recharge 

or water recycling: 10 percent. 

(iv) The extent to which the project 

protects against extreme weather events, 

such as floods or hurricanes, as well as 

the impacts of climate change: 10 

percent. 

(v) The extent to which the project 

helps maintain or protect the 

environment or public health: 10 

percent. 

(vi) The extent to which the project 

serves regions with significant energy 

exploration, development, or 

production areas: 5 percent. 

(vii) The extent to which the project 

serves regions with significant water 

resource challenges, including the need 

to address water quality concerns 

related to groundwater, surface water, or 

other resources, significant flood risk, 

water resource challenges identified in 

existing regional, state, or multistate 

agreements, and water resources with 

exceptional recreational value or 

ecological importance: 10 percent. 

(viii) The extent to which the project 

addresses identified municipal, state, or 

regional priorities: 5 percent. 

(ix) The readiness of the project to 

proceed towards development, 

including a demonstration by the 

prospective borrower that there is 

reasonable expectation that the 

contracting process for construction of 

the project can commence by not later 

than ninety days after the date on which 

a Federal credit instrument is obligated: 

5 percent. 

(x) The extent to which the project 

financing plan includes public or 

private financing in addition to 

assistance under WIFIA: 5 percent. 

(xi) The extent to which assistance 

under WIFIA reduces the contribution 

of Federal assistance to the project: 5 

percent. 

(xii) The extent to which the project 

addresses needs for repair, 

rehabilitation, or replacement of a 

treatment works, community water 

system, or aging water distribution or 

wastewater collection system: 10 

percent. 

(xiii) The extent to which the project 

serves economically stressed 

communities, or pockets of 

economically stressed rate payers 

within otherwise non- communities: 10 

percent. 

The scoring scales and guidance used 

to evaluate each project against the 

selection criteria are available in the 

WIFIA program handbook. Prospective 

borrowers considering WIFIA should 

review the WIFIA program handbook 

and discuss how the project addresses 

each of these selection criteria in the 

LOI submission. 

In the event that EPA changes the 

application or selection process to 

incorporate best practices from the 

initial round, a new NOFA will be 

published. Any updates will also be 

available on the WIFIA Web site: 

https://www.epa.gov/wifia/. 

Authority: 33 U.S.C. 3901–3914; 40 CFR 

part 35. 

Dated: December 22, 2016. 

Gina McCarthy, 

Administrator. 

[FR Doc. 2016–31828 Filed 1–9–17; 8:45 am] 

BILLING CODE 6560–50–P 


pmangrum on DSK3GDR082PROD with PROPOSALS