Environmental Policy Update Newsletter
February 10, 2012 - Governor's Water Supply Program
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In This Issue
On January 25, 2011, Governor Deal signed an executive order directing the Georgia Environmental Finance Authority (GEFA) to develop and implement the Governor’s Water Supply Program (GWSP). In his 2011 State of the State address, Governor Deal committed to provide $300 million over four years for reservoir and water supply development. The governor’s Fiscal Year 2012 budget, as enacted by the General Assembly, authorized the issuance of $45,750,000 in state general obligation bonds to fund these projects, and it is anticipated that similar amounts of bond funding will be made available to the GWSP over the next three fiscal years. Twenty-five million dollars of the FY 2012 bond proceeds will be available through the Department of Community Affairs in the form of state direct investment. Almost $21 million of those proceeds will be added to the $28,500,000 currently held by GEFA in the Georgia Reservoir and Water Supply Fund for low-interest loans to local governments. To meet the balance of the governor’s commitment, GEFA anticipates issuing approximately $88,500,000 in revenue bonds.
The governor directed GEFA to convene a Water Supply Task Force (WSTF) to provide guidance in developing the GWSP and to ensure interagency cooperation in the program’s implementation. The task force included agency heads and officials representing the Georgia Department of Natural Resources, Georgia Environmental Protection Division, Georgia Department of Community Affairs, Georgia State Financing and Investment Commission, State Properties Commission, the Georgia Department of Agriculture, the Georgia Soil and Water Conservation Commission, and the Georgia Environmental Finance Authority. The governor’s directive charged the task force with (1) creating a strategy that details the key challenges to developing new water supply facilities and identifies the most effective solutions; (2) developing project financing options, including but not limited to low-interest and subsidized loans and direct state project investment; (3) exploring opportunities to leverage additional project financing through public private partnerships; and (4) establishing a project selection system that ensures alignment of state financial support for critical, cost-effective water supply projects.
To carry out its charge the WSTF and its subcommittees (the Technology Subcommittee and the Finance Subcommittee) held several public meetings between March 1 and September 2011 at locations throughout the state. Members heard presentations on current water supply issues and challenges, the status of proposed water supply projects in Georgia, and the structure and nature of financing options and project selection processes and systems from various experts. Task Force members also received testimony from local government officials, ACCG, GMA, industry representatives, and environmental advocates.
The WSTF report, adopted on December 14, 2011, outlined recommendations and guiding principles for the GWSP. Specifically: (1) State funds should be used in the most efficient and effective way to maximize water supply, with regional cooperation being the preferred approach. (2) GEFA must achieve a balance between providing attractive financing terms for local governments and maintaining adequate loan fund capacity to provide financing for future projects. (3) The task force recommended the use of several competitive solicitations, in accordance with the WSTF-recommended project selection system, to choose projects in which the state will have direct ownership participation. (4) The GWSP should structure state direct investments in water supply projects for the long-term benefit of local project owners. Intergovernmental agreements should be used to lease the state’s ownership interest to the project-sponsoring local government for nominal monetary consideration, where possible. At the end of the lease period, the state should offer the local government owner the right of first refusal or the right of first offer to purchase the state’s interest in the project. (5) GEFA should provide technical assistance to local governments contemplating the use of public-private partnerships, when requested. In addition, GEFA should help these governments obtain legal and financial advice relating to public-private partnerships. Moreover, financial assistance applications should request that the applicant provide information on current and future public-private partnership arrangements.
After approving the final task force report on December 28, 2011, Governor Deal reaffirmed his commitment in the 2012 State of the State address by announcing the inclusion of almost $46 million in the FY 2013 budget. He also commended the task force members for “creating a thorough, forward-looking plan that makes sense for Georgia communities, big and small.” Support for the water supply and conservation project funding was also included in the 2012 Georgia Competitiveness Initiative Report. In implementing the GWSP, GEFA and DCA have announced that the application period is open for the initial funding through the GWSP. The deadline for applications is April 30, 2012. GEFA will be hosting three workshops for local government representatives to help them thoroughly understand the application process. The first of these workshops will be held February 24, 2012, at Gwinnett Technical College. For dates, times, and locations of all three workshops, visit the Water Supply Plan website at www.georgiawatersupply.org.
In the News
“Deal approves water task force’s reservoir plan” by Ashley Fielding of the Gainesville Times. Discusses Governor Deal’s approval of the plan submitted by the Water Supply Task Force for financing water supply projects under the $300 million Governor’s Water Supply Program.
“Georgia’s water situation: Our future rides water’s wave” by Kevin Riley, editor of the Atlanta Journal-Constitution. Comments on the complexity of approaches to address Georgia’s water supply challenges and Governor Deal’s plans for financing new water supply projects. Commends Governor Deal for “keeping water on Georgia’s mind.”
“Hard Labor Creek Reservoir still plying for state funding” by Robbie Schwartz of the Walton Tribune. Discusses the status of the Hard Labor Creek Reservoir and meetings between local officials and Governor Deal regarding state financial assistance.
“Water supply, conservation vital” by Kevin Clark, executive director of the Georgia Environmental Finance Authority. Emphasizes that solutions to meeting Georgia’s water supply needs include both construction of new water supplies and implementation of effective conservation practices.
The opinions expressed here are solely the responsibility of the authors.
In the General Assembly
HB 811: Budgetary and financial affairs; automatic fee adjustment in certain cases; provide
This bill provides that certain fees and additional penalty sums must be used for the purposes specified in law or a commensurate fee reduction will occur in the next fiscal year to cover any proceeds that are redirected for other purposes. The measure provides that such requirements will be phased in over five years.
Status: Referred to the House Governmental Affairs Committee
SB 269: Water Resources; cooperative efforts for abatement of pollution, order of director, request for hearing; provisions
This bill authorizes the EPD Director to notify any person determined to be illegally discharging wastes into waters of the state of an opportunity to voluntarily perform corrective action under an administrative consent order. The measure also provides similar authority for persons determined to be in violation of surface water withdrawal laws and regulations. Senate Bill No. 269 also authorizes the EPD Director to require a local government to post a performance bond or letter of credit payable to the Georgia Environmental Finance Authority to assure compliance with the consent order. The amount of that bond or letter is in lieu of a civil penalty.
Status: Favorably Reported from the Senate Natural Resources and Environment Committee
SB 374: Water Resources; exempt water withdrawals; Tennessee River basin restrictions on transfers of water
This bill amends Georgia’s laws relating to water resources management to provide that surface water withdrawals from certain streams in Georgia in the Tennessee River basin shall be exempt from restrictions on interbasin transfers.
Status: Referred to the Senate Natural Resources and Environment Committee
SR 677: Preservation of Sapelo Island; Joint Study Committee; create
This resolution creates the eight-member Joint Study Committee on the Preservation of Sapelo Island. Among the study committee’s charge is an evaluation of building codes and zoning codes necessary for protection of the island’s heritage; the need for ethical oversight and conflict-of-interest limitations related to island governance; the need for greater public policy participation by island residents in governance; equities in property tax evaluations and assessments; and fair representation of the Geechee Gullah people in government public policy affecting the island. If the study committee makes a report, it must do so by December 31, 2012.
Status: Referred to the Senate Natural Resources and Environment Committee
SR 727: Senate Preservation of Sapelo Island Study Committee; create
This resolution creates a seven-member Senate Study Committee on the Preservation of Sapelo Island with the charge described for SR 677.
Status: Referred to the Senate Natural Resources and Environment Committee
SR 730: United Nations Agenda 21; recognize destructive and insidious nature
This resolution recognizes the destructive and insidious nature of the United Nations Agenda 21, a comprehensive plan of extreme environmentalism, social engineering, and global political control, and endorses rejection of its radical policies.
Status: Referred to the Senate Rules Committee
SR 781: Tennessee River Basin; urge the performance of a feasible study of withdrawal, storage, and distribution of waters
This resolution urges the Georgia Department of Natural Resources, the Water Supply Division of the Georgia Environmental Finance Authority, and private enterprises to study the feasibility of withdrawing surface water from north-flowing tributaries of the Tennessee River and storing that water in abandoned rock quarries in north Georgia. Stored water could be distributed through pipelines laid on railroad right-of-ways.
Status: Referred to the Senate Natural Resources and Environment Committee
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