FCAP FAQs

We compiled common questions and concerns in the frequently asked questions (FAQs; below).  We expect to expand it with additional input from customers like you.  You may read along or consider searching for keywords to speed up your research.

Q:  Is there an eligibility handbook that helps applicants determine if their project would be eligible?

A:  Yes, EPA released the Drinking Water State Revolving Fund (DWSRF) Program Eligibility Handbook on June 2017.

Q:  How small is “too small” when it comes to applying to the DWSRF Program for construction projects?

A:  VDH does not define “too small” in terms of a dollar amount for a construction project, but please keep in mind that this program is intended for Capital Improvement Projects. We highly encourage waterworks to determine their five-year needs and apply to our program with that in mind.  Also, please note that VDH reserves the right to limit 100 percent principal forgiveness offers on small projects to those projects that are resolving a documented acute and/or chronic health issue.

Q:  Could you clarify the slide that reads “Funding offers may not be made to waterworks owners that have more than two open DWSRF projects”?

A:  The Financial and Construction Assistance Programs (FCAP) encourages all waterworks owners that have a DWSRF construction application to apply by April 1, 2019 if their project workload is manageable.  All waterworks owners should be working diligently to get their existing (open/active) DWSRF funded projects to loan closing, construction, and then ultimately closed out in a timely fashion.

If a waterworks owner is anticipating more than two open DWSRF funded projects as of July 1, 2019 then FCAP will look at this on a case-by-case basis to determine whether additional projects will be funded. FCAP will consider many factors when making this decision.  These factors include, but are not limited to:  number of open DWSRF projects, existing project status, history of past projects, and the proposed scope of work of the FY20 construction application.  Keep in mind that applicants can withdraw from consideration any open project that they believe are of lesser priority to reduce the number of open DWSRF projects.

Q:  What is VDH looking for in terms of the preliminary engineering conference (PEC) meeting minutes?

A:  PEC meeting minutes should include, but not be limited to: date of meeting; list of meeting attendees; project description (including scope and engineer’s cost estimate); planned sources of funding (if established at that time); if a preliminary engineering report is required by VDH or if additional information is needed to establish this; and if a construction permit is required by VDH or if additional information is needed to establish this.

Q:  If something is eligible for principal forgiveness (grant) funds, do we show that in some way as grant funding on the construction application budget (Page 9/10, Section H) or is principal forgiveness simply offered by VDH.

A:  If the project receives a funding offer, then VDH will document the terms in the initial offer letter. This letter will state how much of the funding is loan versus principal forgiveness (if the project qualified for principal forgiveness). It will also document the loan terms (interest rate and length of loan).

The amount of principal forgiveness does not need to be documented in the budget – Section H of the construction application. However, if a waterworks is requesting that an Asset Management Plan be added to the project, then we would recommend that they circle the terms “Asset Management Plan” on Item 13 (Other) of the budget (Page 9/10, Section H of the construction application).  Then, add the dollar amount in Item 13 for the preparation of an Asset Management Plan.    Please keep in mind that VDH will reimburse actual expenses (if procurement guidelines are followed) for the preparation/approval of this plan not to exceed $15,000 as principal forgiveness.

Q:  I want to develop an Asset Management Plan. What tools or resources are available to assist me with this?

A:  VDH and EPA have several resources to help you develop an asset management plan. Many of these are accessible through the Capacity Development Page at https://www.vdh.virginia.gov/drinking-water/capacity-development/asset-management/.  A good place to start is with the EPA Publication “Asset Management: A Best Practices Guide“. Other tools available to help waterworks identify the Current State of Assets, include the VDH Asset Inventory Excel spreadsheet located at the bottom of this webpage.  A VDH Asset Management Checklist and a completed Asset Management Plan template for a small town are also available upon request.  In the future, we hope to have these items available on the website as well.

Q:  The webcast mentioned “special funding” for consolidation/regionalization. What are the funding terms for special funding?

A:  VDH encourages the consolidation of ownership of small (or failing) systems to better leverage economies of scale and the capacity of the existing/larger system.  VDH is committed to work with waterworks owners and provide them with “special funding” if the proposed loan is to consolidate water systems if the waterworks to be acquired is considered failing, at-risk of failure, or has inadequate technical, managerial, and financial capacity.  The funding terms for this “special funding” are dependent on market conditions at the time of loan closing so we cannot provide you with these funding terms at this time.

Q:  If we have what we consider to be “an emergency project” should we apply to VDH for construction funding?

A:  The first step with this is to refer to the DWSRF Program Design Manual, page 13 of 27 (Emergency Projects), to see if your project meets the criteria for VDH to consider it an emergency project. Then, please keep in mind that the project still needs to meet all DWSRF program requirements. When all of these requirements are satisfied, the funds still may not be available until the first quarter of 2020.  Please consider all of these factors when making your decision whether to apply to VDH for funding or not.  VDH would like assist all emergency projects but we also want all stakeholders to have realistic expectations when making this important decision.

Q:  If VDH by-passed one of our projects several years ago, can we re-apply for funding for this project?

A:  If VDH by-passed your project you may re-apply for funding if the issue that caused it to be by-passed has been fully resolved. If the issue has been resolved, then indicate how it was resolved in the construction application so VDH is aware of this.  Please use the FY20 construction application and ensure that all information is current versus re-submitting what had been used years ago.

Q:  We are interested in VDH’s Lead Service Line Replacement Program. What resources are available so we can learn more about this?

A:  The first resource would be the DWSRF Program Design Manual, Appendix D. It generally describes program expectations and thresholds for waterworks owners who plan to initiate, expand or continue their full Lead Service Line Replacement Programs. The Lead Service Line Replacement Collaborative website offers a toolkit and compiles many other resources to help waterworks owners establish and improve the lead service line replacement initiatives. Representatives from previously funded waterworks have also expressed their will to share insights to help others setup their programs. You may want to contact a member of the FCAP Team to get points of contact from the latter, discuss you project and obtain additional information, such as the VDH LSLR Documentation Guidance for rebate programs.

Q:  Our water system serves multiple localities. Can VDH fund Lead Service Line Replacement Programs for applications from these localities or are we limited to applications from the waterworks owner?

A:  VDH’s financial support for Lead Service Line Replacement Programs is limited to $500,000 per year for eligible waterworks owner. This threshold is meant to manage multiple challenges associated with this type of funding. Since there are multiple waterworks that serve more than one locality, VDH envisioned the threshold to help maintain a fair distribution of limited principal forgiveness (grant) funds across Virginia.