2011 ORS § 541.646¹
Rules for grant and loan programs

The Water Resources Commission may adopt rules the commission considers reasonable for the administration and enforcement of ORS 541.600 (Definitions for ORS 541.600 to 541.641 and temporary provisions relating to loans for Columbia River Basin projects) to 541.641 (Exception to water measurement requirement) and sections 20, 25 and 26, chapter 907, Oregon Laws 2009. [2009 c.907 §28]

Note: 541.646 (Rules for grant and loan programs) was enacted into law by the Legislative Assembly but was not added to or made a part of ORS chapter 541 or any series therein by legislative action. See Preface to Oregon Revised Statutes for further explanation.

Note: Sections 20, 25 and 26, chapter 907, Oregon Laws 2009, provide:

Sec. 20. (1) A water developer, as defined in ORS 541.700 (Definitions for ORS 541.700 to 541.855), shall file an application for a loan from the Water Development Fund as provided in this section instead of under ORS 541.705 (Project applications) if:

(a) The applicant is not a municipality or a provider of water for municipal purposes;

(b) The loan is for the purpose of enabling the construction of a water development project in the Columbia River Basin; and

(c) The moneys from which the loan is to be funded were provided under an appropriation that dedicates the moneys for use under this section or for loans of a type described in this subsection made to applicants of a type described in this subsection.

(2) An application filed under this section must be in a form prescribed by the Water Resources Commission and include the following:

(a) A description of the nature and the primary and secondary purposes of the project.

(b) An analysis of the need for the project and for the water that the project is intended to deliver.

(c) Identification and description of the project components sufficient to meet the conditions for project funding approval under section 25 of this 2009 Act.

(d) A description of the economic feasibility of the project, including but not limited to:

(A) The costs of the project; and

(B) Information about the financial and other aspects of the operation and maintenance plans for the project.

(e) Suggestions for interim and long-term project performance benchmarks.

(f) An analysis of the project impacts including, but not limited to, the:

(A) Expected economic public benefits.

(B) Expected social and cultural public benefits.

(C) Expected net environmental public benefits.

(g) An evaluation of the potential impact on water quality, based upon water quality standards.

(h) Proof that the applicant has acquired at least a final order or limited license for necessary water permits from the department.

(i) Letters of support for the proposed water resource development project.

(j) If the project has not previously received state funding, a statement regarding whether other moneys are available or have been sought or received for the implementation of the water resource development project.

(k) A description of a loan repayment plan.

(L) Any other information required by the department.

(3) Any relevant information described in ORS 541.705 (Project applications) (2)(c) or (e) or (3).

(4) If the project will receive surface water impounded from a perennial stream, water diverted from a stream that supports sensitive, threatened or endangered fish, or more than 500 acre-feet of diverted surface water annually, in addition to the other information required under this section the application shall include the following completed studies:

(a) An analysis of by-pass, optimum peak, flushing and other ecological flows of the affected stream and of the impact of the project on those flows, that conforms to standards set by the department in consultation with the State Department of Fish and Wildlife and other relevant agencies;

(b) An independent comparative analysis of alternative means of supplying the water intended to be generated by the project, including but not limited to the costs and benefits of conservation, reuse and alternatives and the extent to which long-term water supply needs may be met using those alternatives; and

(c) Evaluation of the need for and feasibility of using project-derived water to augment in-stream flows to conserve, maintain and enhance aquatic life, fish life and any other ecological values.

(5) If the applicant is an agricultural water supplier, the applicant must have an approved agriculture water management and conservation plan, have submitted a completed agricultural water management and conservation plan to the Water Resources Department for approval or be in the process of completing or updating a water management and conservation plan.

(6) An application under this section is subject to application fees and additional processing costs as described in ORS 541.710 (Processing project application) and loan processing fees under ORS 541.730 (Loan contract).

(7) An analysis and evaluation conducted as part of a study performed pursuant to chapter 13, Oregon Laws 2008 [541.561 (Establishment of grant program) to 541.581 (Rules for grant and direct service cost payment program) and sections 5 and 6, chapter 13, Oregon Laws 2008], is deemed to satisfy the requirements of subsection (4) of this section. [2009 c.907 §20]

Sec. 25. (1) The Water Resources Department, acting as agent for the Water Resources Commission, may approve a loan for which an application is filed under section 20 of this 2009 Act, if the department finds that:

(a) The loan meets any applicable qualifications or restrictions under Article XI-I(1) of the Oregon Constitution, ORS 541.700 (Definitions for ORS 541.700 to 541.855) to 541.855 (Biennial report to Legislative Assembly and Governor), section 26 of this 2009 Act, Water Resources Commission rules and bondholder agreements;

(b) The plan for the construction of the proposed project complies with all applicable provisions related to water well constructors under ORS 537.747 (Water well constructors license) to 537.765 (Log of constructing, altering, abandoning or converting well), reservoirs and diversion dams under ORS 540.340 (Reservoir and diversion dam) and dams, dikes and hydraulic structures or works in ORS 540.350 (Dams, dikes and other hydraulic works);

(c) Planned diversions of surface water include provision for fish screens and, if applicable, volitional fish passage;

(d) The use of surface water or ground water from the project will be measured and reported;

(e) The applicant or beneficiaries of water from the project measure and report, or have scheduled and financed the measurement of, all existing water use at the point of diversion;

(f) There is a reasonable certainty that the project will deliver a measurable net environmental public benefit; and

(g) The project is designed to deliver in-stream benefits.

(2) The department shall require that a project protect peak and ecological flows to the extent determined by the State Department of Fish and Wildlife to be necessary.

(3) This section and sections 20 and 26 of this 2009 Act do not limit the authority granted the Environmental Quality Commission or the Department of Environmental Quality under ORS chapter 468B. [2009 c.907 §25; 2009 c.907 §31]

Sec. 26. (1) The Water Resources Department shall ensure that any necessary federal and state environmental impact approval processes have been completed, and that agencies have issued any relevant approvals and permits, before the advancement of any loan moneys for a project described in section 25 of this 2009 Act. The department shall determine the amount of a loan for a project described in section 25 of this 2009 Act on a case-by-case basis. The department shall determine the maximum amount of a loan based in part upon a reasonable and prudent expectation of the ability of the borrower to repay the loan. The department may not issue a loan to provide assistance for operational or maintenance expenses of a water development project other than project startup costs.

(2) Notwithstanding ORS 541.730 (Loan contract), if the Water Resources Commission, in consultation with the State Treasurer, believes that the project is unlikely to produce a net profit for the borrower or for any for-profit entity, the commission may set the loan interest rate at a level that reduces or waives the amount of the interest rate set under ORS 541.730 (Loan contract) that is in excess of the interest to be paid to bondholders on the underlying bonds.

(3) The department may issue a loan only if the applicant agrees to periodic review of the project, including but not limited to:

(a) Review of interim and long-term performance benchmarks set by the department; and

(b) Program and fiscal audits to ensure that performance benchmarks are achieved on project development, project benefits and return on investment.

(4) The department may issue a loan only if the applicant agrees to report to the department no later than two years after receiving the loan moneys regarding the progress of the project and the economic public benefit, social and cultural public benefit and net environmental public benefit realized from the project. The department shall provide copies of the applicant reports received by the department during the biennium to an interim committee of the Legislative Assembly dealing with natural resources.

(5) The commission may establish reasonable fees for management, oversight or review services that the department provides for a water development project. The fees shall be deposited to the Water Development Administration and Bond Sinking Fund. [2009 c.907 §26]

Note: Section 34, chapter 907, Oregon Laws 2009, provides:

Sec. 34. Sections 20, 25 and 26 of this 2009 Act are repealed January 2, 2024. The repeal of sections 20, 25 and 26 of this 2009 Act by this section does not alter the terms of any loan, contract or other agreement issued under section 20, 25 or 26 of this 2009 Act or alter the conditions of any water permit or water right certificate that contains conditions that are based upon sections 20, 25 or 26 of this 2009 Act. [2009 c.907 §34]

Note: Section 29, chapter 907, Oregon Laws 2009, provides:

Sec. 29. The Water Resources Department shall report to the Seventy-sixth Legislative Assembly in the manner provided by ORS 192.245 (Form of report to legislature) no later than October 1, 2012, regarding the operation of the loan and grant programs described in sections 18 to 27 of this 2009 Act [541.600 (Definitions for ORS 541.600 to 541.641 and temporary provisions relating to loans for Columbia River Basin projects) to 541.641 (Exception to water measurement requirement) and sections 20, 25 and 26, chapter 907, Oregon Laws 2009], including but not limited to:

(1) The number and types of jobs created by water development projects receiving loans or grants from the department;

(2) Any studies conducted by the department or loan or grant recipients during the 2009-2011 biennium regarding peak and ecological flows in streams;

(3) Any recommendations by the department for legislative changes to improve the operation of the loan and grant programs;

(4) Any recommendations for changes to Article XI-I(1) of the Oregon Constitution to be referred to the people;

(5) The total economic public benefit, social and cultural public benefit and net environmental public benefit created as a result of loans and grants issued under sections 23 [541.631 (Conditions for approval of grant application)] and 25 of this 2009 Act;

(6) An analysis of the effect of the requirement imposed under section 23 (2) of this 2009 Act;

(7) Estimated increases in state tax revenues generated by projects receiving grants or loans;

(8) The gross dollar value of issued loans, the amount of loan reserves and the increase the Water Development Fund attributable to the interest rate amount described in ORS 541.730 (Loan contract) (3)(e); and

(9) Moneys generated from fees under sections 19 [541.611 (Application for grant from Water Investment Grant Fund)], 20, 24 [541.636 (Conditions for issuance of grant)] and 26 of this 2009 Act. [2009 c.907 §29]