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Advantages: Because it eliminates underwriter and rating agency fees, printing costs, and time- <br />consuming documentation and disclosure processes, direct source financing can reduce front-end <br />and total costs. <br />Limitations: Direct source fmancing is not practical for major facility projects, which require <br />larger dollaz amounts and a longer repayment term. <br />Applicability: In certain circumstances, this would be an acceptable financing tool for MWMC, <br />although much of the plant equipment is already provided for in the Equipment Replacement <br />Reserve. <br />State RevolvinyFunds -Clean Water Loans <br />(General program descriptions are followed by italicized descriptions of the specific State of <br />Oregon CWSRFprogram. Substantial additional detailed information on the Oregon program is <br />available upon request.) <br />Description: Under Title 6 of the 1987 Clean Water Act, states receive Federal monies to <br />capitalize Clean Water State Revolving Loan Fund (CWSRF) programs. States must provide a <br />20 percent match to the Federal funds. CWSRFs are authorized to make loans to localities to <br />finance wastewater treatment facilities, nonpoint source pollution control activities and estuary <br />program. activities. Loans are made at low interest rates (zero percent to mazket rate) for up to 20 <br />years. States can use loan funds to refinance previously executed debt obligations, guarantee <br />local debt obligations, buy bond insurance for local debt obligations, or guarantee bonds issued <br />by municipal and inter-municipal revolving funds. States may use up to four percent of the <br />Federal funds for administrative costs. States may set the criteria for determining which <br />municipalities can access the loans and other fund uses each yeaz. <br />The CWSRF Loan Program offers below market interest rate loans to public agencies for <br />planning, design and construction of three kinds of water pollution abatement projects: <br />1) wastewater collection, treatment, water reuse and disposal systems, <br />2) nonpoint source water pollution control projects, and <br />3) the development and implementation of management plans for federally designated <br />estuaries. <br />Specific project types that maybe eligible for CWSRF funds include: <br />• Wastewater system facility plans and studies <br />• Secondary treatment facilities <br />• Advanced wastewater treatment facilities <br />• Sludge disposal and management <br />• Interceptors, force mains and pumping stations <br />• Infiltration and inflow correction <br />• Major sewer replacement and rehabilitation <br />• Combined sewer overflow correction <br />• Collector sewers <br />• Stormwater control <br />• Estuary management <br />', <br />2005 MWMC Financial Plan - Appendix II Page 35 <br />