- How much local match is needed to receive a grant to purchase land or a conservation easement on land around a source of public drinking water?
A 75% match is required. This is 75% of the cost of the land and any associated costs such as legal costs, appraisal costs etc. The example below provides further explanation how the match can be calculated.
- Does the match have to be a cash match?
No - the match can be fulfilled with one or more of the following:
- A donated interest in land. (Any land that is donated to satisfy the match requirement must be undeveloped, not currently owned by the applicant, and within the source water protection area for a source of drinking water)
- A local appropriation
- Other grants or privately raised funds
- Bargain sale amounts for the grant property
- Transaction costs including legal fees, survey, appraisal, title examination, etc…
- Can the Drinking Water State Revolving Loan Fund (DWSRF) be used by a grantee for the match?
Yes - the DWSRF is a special loan fund with a low interest rate. Unlike other State Revolving Loans there is no discount for disadvantaged communities. The loans can be for 5 - 20 years. The interest rate varies with the term of the loan. The current rates are shown below:
Term of Loan Charge Rate 5 years 1.395% 10 years 2.790% 15 years 4.185% 20 years 4.464%
- How do I get a Drinking Water State Revolving Loan?
The process to obtain the loan begins with completing a DWSRF loan application form. Applications can be obtained by contacting Sarah Pillsbury at 271-1168 or [email protected].
- How do I calculate match?
Match is 25% of the total cost of acquiring the source water protection lands (including match properties) specified in the application. The following example will illustrate how match will be calculated:
Example of Match Calculation for Different Types of Projects
For each example, 60 acres in the source water protection area are being purchased by the water supplier from a landowner for the appraised value of $100,000. The 60-acre parcel is called the "grant parcel" to distinguish it from any properties donated to satisfy the local match requirement. The state can fund up to 25% of the total eligible costs for the project. Three different examples are shown below to illustrate different possible sources of local match. For each calculation, these rules apply:
Total eligible costs = grant property value + match property value + transaction costs
Maximum state share = Total eligible costs x .25
Local match value = any bargain sale amount for grant property
+ appraised valued of donated land or interest in land
+ local appropriations
+ other grants and privately raised funds and transaction costs
In Example A, the local match is supplied from $71,250 in locally raised cash and transaction costs. The necessary amount of local cash is calculated by subtracting the state grant from the grant property purchase price ($100,000- $28,750 = $71,250).
In Example B, an owner of 150 acres, also in the source water protection area, has offered to donate a conservation easement on their land if the state awards a grant to the water supplier to purchase the 60-acre grant property. With the addition of a second property to the package, the transaction costs rise and the total eligible costs rise. As a result, the amount of the state's grant can also rise. The need for local cash is diminished because most of the match is being supplied by the conservation easement donation.
In Example C, the match is supplied by a large land donation and transaction costs. The appraised value of the land donation is high enough to exceed the 75% (of total eligible cost) requirement for the local match.
Project Component Example A Example B Example C Grant property purchase price $100,000 $100,000 $100,000 Donated match property $0 $190,000 $270,000 Transaction costs $15,000 $30,000 $30,000 Total eligible costs $115,000 $320,000 $400,000 State Grant Share (25%) $28,750 $80,000 $100,000 Local cash $71,250 $20,000 $0 Local Match % 75% 75% 75%