Status Update on "Delayed and Deferred" State Aid Grant Projects

NHMA Staff

In November 2008, funding for state aid grants (SAG), including landfill closures, public drinking water and wastewater facilities, was suspended by the legislature resulting in a backlog of 127 eligible and completed projects which did not receive any state support in fiscal years 2009-2013. Historically, the legislature has supported these public works projects (pursuant to RSA 486, RSA 486-A and RSA 149-M) for municipalities to receive from 20% to 30% of grant assistance toward principal and interest payments on eligible environmental infrastructure projects. All grant applications that were submitted to the Department of Environmental Services (DES) and had not yet been approved by Governor and Executive Council (or were submitted after November 2008) were placed on a list, which was referred to as the “Delayed and Deferred list.” A total of eight landfill closure grants, 16 drinking water grants, and 103 wastewater grants were on the “Delayed and Deferred List.”

State aid grants are part of a comprehensive program administered by DES that provides financial assistance to New Hampshire municipalities to offset the eligible costs of planning, engineering design, and construction of certain public works facilities. It is important to note that 100% of grant funds appropriated to DES by the legislature are passed through to cities and towns.

Recognizing that these infrastructure projects are typically driven by increased federal and/or state regulations, the legislature, with strong support and leadership by Governor Hassan, appropriated almost $9.5 million in the state’s Operating Budget for fiscal years 2014-2015. Beginning in August 2013, DES began processing these state aid grant awards before Governor and Executive Council. As of March, a total of 61 grants totaling $3,012,806 were approved by Governor and Council for 34 cities and towns. Among these award recipients is the Winnipesaukee River Basin Program, a state-owned sewer system serving the communities of Center Harbor, Moultonborough, Gilford, Meredith, Laconia, Belmont, Sanbornton, Northfield, Tilton and Franklin. Information regarding the total grant award and the first initial payment (FY14) is shown in the table below.

NHMA would like to express our sincere gratitude to DES for processing these grant awards efficiently through Governor and Council. NHMA would like to specifically recognize the following DES staff for their work: Beth Malcolm, James Tilly, Alex Rastorguyeff, Dan Fenno, Laura Filiau and Rick Skarinka. Special thanks also to Paul Heirtzler and Harry Stewart for all their support and assistance during the legislative advocacy and state aid grant approval process.

It is uncertain if future funding will be restored to the SAG program. That will be a decision for the legislature. However, state law continues to provide financial assistance to municipalities under RSA 486 (wastewater projects) and RSA 486-A (public water systems). Sometime this August DES will be holding a public hearing to review completed infrastructure projects that meet the minimum requirements that must be met for a project to be eligible for SAG funding. Municipalities should continue to utilize the same pre-application form and protocol as used in the past to place your completed infrastructure project on DES’ approved priority list.

As we move forward, local governments and the state must partner to find a long-term solution for needed revenues to provide infrastructure for economic expansion and to replace deteriorating water infrastructure. In this regard, federal and state grant and loan programs are more important than ever before. Many smaller municipalities, with fewer rate payers and lower assessed property value, have difficulty financing debt needs to meet infrastructure requirements and are dependent upon state assistance. Nothing is more fundamental to the state-local partnership than economic development. New Hampshire’s economy is, in essence, a collection of 234 local economies. If the state’s economy is to move ahead, it is essential to advance these local economies as well. Economic growth spurs the engines that make government spending possible, and economic growth is driven locally by a quality water infrastructure.