WATER QUALITY IMPROVEMENT FUND

The Virginia Water Quality Improvement Act of 1997 (Section 10.1-2117 through 2134) was enacted by the Virginia General Assembly in response to the need to finance the nutrient reduction strategies being developed for the Chesapeake Bay and its tributaries.

Pursuant to the Act, the Commonwealth established in the State treasury a special permanent, nonreverting fund, known as the "Virginia Water Quality Improvement Fund." The Act directs the Department of Environmental Quality to assist local governments and individuals in reducing point source nutrient loads to the Chesapeake Bay with technical and financial assistance made available through grants provided from the fund.  Section 10.1-2129.B. of the Act directs the Secretary of Natural Resources to develop written guidelines that (i) specify eligibility requirements; (ii) govern the application for and distribution and conditions of WQIF grants; and (iii) list criteria for prioritizing funding requests. 

Legislation passed during the 2006 session amended the WQIF guidelines with respect to several point source issues (see link for details ).  In November 2006, the Office of the Secretary of Natural Resources published revised guidelines based on changes made by the General Assembly and public comments.  The current document can be be obtained by clicking on the following link: Guidelines.  

WHAT's NEW FROM THE 2007 SESSION

Legislation passed during the 2007 session amended, notably, two administrative aspects:  A) the disbursement of grants for the design and installation of nutrient removal technology at those publicly owned treatment works included in subsection E and eligible nonsignificant dischargers shall be made as follows: (i) the first phase of a grant shall be disbursed upon written certification that 25% of the local share of the cost of nutrient removal technology for the project has been expended; (ii) the second phase upon written certification that 50% of the local share of the cost of nutrient removal technology for the project has been expended; (iii) the third phase upon written certification that 75% of the local share of the cost of the nutrient removal technology for the project has been expended; and (iv) the final phase upon written certification that 100% of the local share of the cost of the construction, expansion, or upgrade of nutrient removal technology for the project has been expended and B) the Director of the Department of Environmental Quality shall not be required to enter into a grant agreement with a facility designated as a significant discharger or eligible nonsignificant discharger if the Director determines that the use of nutrient credits in accordance with the Chesapeake Bay Watershed Nutrient Credit Exchange Program (§ 62.1-44.19:12 et seq.) would be significantly more cost-effective than the installation of nutrient controls for the facility in question. 

COST CONTROL REPORT IS FINAL

In order to establish the criteria associated with this second item, DEQ set up a technical advisory committee (TAC) and the first meeting topics can be found at: agenda.   Subsequent meetings were held on May 30 and June 29.  A summary of the meeting minutes can be found at: May 30 minutes ; a summary of the follow-up discussion can be found at:  Follow-upQ&A ; and a summary of the last meeting minutes can be found at: June 29 minutes.   The Department sought comments on proposed Water Quality Improvement Fund (WQIF) cost control guidelines and policies, as presented in a DRAFT Report.  Three organizations submitted comments prior to the period closing on Sept. 14, 2007.    

The Final Report is available on the DEQ-WQIF web site at:  Cost Control Report. 

WQIF APPLICATION PROCESSING

In FY 2005, DEQ announced the availability of Technical Assistance Grants and developed an TA application to be used by facilities treating domestic wastewater and as shown on our list of significant dischargers. As a result of the solicitations for technical assistance funds, approximately 46 projects are anticipated to be funded. A list of projects and cost-share (where it is known) is shown on the TA grant list.

Applicants for construction projects must first submit a grant Application during a solicitaion period.  In September 2005, DEQ began a  solicitation for  point source grant applications in accordance with new Guidelines issued by the Secretary of Natural Resources.  At the January 26, 2006 deadline, 63 applications were received by DEQ for a total of about $631 million .  In order to process the applications in a fair and equitable way and also establish a prioritization, DEQ developed guidance memorandum (GM) #06-2012.  Based mostly on the recommendations found in the cost control report referenced above, an addendum to the guidance memorandum has been produced. Of the original applications, the projects are in various stages relative to readiness to proceed and development of a draft agreement.  DEQ considers the projects found at the following link: ready to proceed.

To develop a draft agreement, DEQ relies on: the application, external information (such as water billing records and Census information), a Preliminary Engineering Report, bid information (i.e. schedule of values) from the contractor, and the A/E agreement with scope.  Once a draft agreement for construction is ready for public review, a review period is posted and public comments are solicited during a comment period of at least 30 days at the following link: draft/public-noticed agreements.  Draft agreements may be viewed at the respective DEQ regional office or the DEQ central office.

Following this period, a project will then listed on the website as signed grant agreements. Within the Bay Watershed, use of point source funds is limited to financing the design and installation costs of nutrient reduction technologies at eligible publicly owned treatment works. Likewise, the act directs the Department of Conservation and Recreation (DCR) to provide similar assistance to local governments, Soil and Water Conservation Districts, other groups, and individuals in efforts to control nonpoint source pollution.

As required by the act, all point source construction grants must be governed by a legally binding, enforceable agreement that includes provisions to: govern design and installation of facility upgrades; require long-term operation, maintenance and monitoring; require periodic reporting; and include stipulated penalties for non-performance. The Act also requires that these agreements be made available for public review and comment for at least 30 days before execution.

A solicitation for eligible WQIF projects was completed by applications postmarked by June 18.  A list of Projects request funds in 2007 can be found at: Applicants2007.

Summary of Appropriations by Fiscal Year