Oregon DEQ: Economic Stimulus Funding for Environmental Priorities in Oregon

The American Recovery and Reinvestment Act (ARRA) provides $6 billion to help communities with water quality, wastewater and drinking water infrastructure needs; $300 million for grants and loans to help with projects that reduce diesel emissions; $200 million for cleanup of petroleum leaks from underground storage tanks; $100 million for competitive grants to evaluate and clean up brownfields (former industrial and commercial sites) and $600 million for the cleanup of hazardous “Superfund” sites.

Oregon is focused on accelerating our state's economic recovery by creating jobs and economic stability for communities throughout the state during this volatile time. Governor Ted Kulongoski's approach is comprehensive, leveraging state and federal dollars and private investment to maximize efforts that deliver short-term stimulus and long-term economic prosperity. The ARRA empowers Oregon to invest in its economy by pursuing smart, sustainable, and transformational efforts - doing this "The Oregon Way."

DEQ will administer an estimated $53 million or more in Recovery Act funding for environmental projects in Oregon.

Oregon DEQ Administered Funds
Clean Water/Clean Drinking Water
State Revolving Funds
Water Quality Planning Grant
Clean Diesel Grants
Leaking Underground Storage Cleanups

Oregon DEQ Administered Funds

The Oregon Department of Environmental Quality will receive the following Recovery Act funding:

Approximately $45 million for the Clean Water State Revolving Fund (CWSRF) loan program
$447,200 to conduct water planning projects
$1.7 million in state clean diesel funding for grants. DEQ will also apply for approximately $3.25 million in competitive diesel grant funds under the National Clean Diesel Funding Assistance Program, and
Up to $2.8 million to protect human health and the environment by cleaning up petroleum leaks from underground storage tank sites.

DEQ may receive additional funding for grants related to brownfield cleanups and is awaiting information from EPA on how funding for these projects will be administered.

Clean Water State Revolving Fund and Drinking Water State Revolving Fund

Oregon DEQ will receive about $45 million through an additional capitalization grant for the Clean Water State Revolving Fund (CWSRF) loan program. The CWSRF program provides low-cost loans to communities for water quality and wastewater infrastructure needs.

Funding requirements

The ARRA requires all funds to be committed to eligible projects by Feb. 16, 2010. Loan agreements must be signed with DEQ for projects that are committed to contracts for construction or in which construction has begun.

Green Project Reserve Funding

At least 20 percent of the capitalization grant will be awarded to projects that address green infrastructure, water or energy efficiency improvements or other environmentally innovative activities. This is known as the Green Project Reserve and amounts to $8.8 million in Oregon. DEQ will evaluate project applications and identify those projects that qualify for this portion of the funding. If there are no eligible projects among the CWSRF applications, DEQ will make a solicitation for Green Project proposals. If there are still not sufficient applications, DEQ will certify this to EPA and the remaining amount in the Green Project Reserve can then be used for other eligible CWSRF projects.

Subsidization includes loan principal forgiveness

States are also required to use at least 50 percent of the capitalization grant to provide additional subsidization to eligible applicants. Oregon will provide principal forgiveness on a loan as the additional subsidization. A loan made to a borrower that is a small community (defined in CWSRF administrative rules as a public agency serving a population of 5,000 or less) will include 75 percent principal forgiveness. All other loans made under the Act will include 50 percent principal forgiveness. For both types of loans, the remaining loan amount will be repaid at zero percent interest. DEQ is embarking on temporary rulemaking to include these financial terms.

Additional Information can be found at:

DEQ Clean Water State Revolving Fund Loan Program
EPA Region 10 Recovery Funding for Clean Water/Drinking Water Projects

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Water Quality Planning Grant

DEQ anticipates receiving a grant of approximately $447,200 to conduct water planning projects; 40 percent of this grant − $178,880 − is to be allocated to regional public planning organizations that assist in the development and implementation of water quality management plans that include watershed restoration and other water-related implementation activities. DEQ is currently working with EPA to determine a list of eligible projects for this grant in Oregon.

Clean Diesel Grants

The ARRA provides $300 million to support clean diesel activities meeting the following priorities:

Maximize public health benefits;
Are the most cost effective;
Are in area with high population density, that are poor air quality areas (including nonattainment or maintenance areas, Federal Class 1 areas; or areas with toxic air pollutant concerns);
Are in areas that receive a disproportionate quantity of air pollution from diesel fleets, including truck stops, ports, rail yards, terminals and distribution centers or that use a community based multi stakeholder collaborative process to reduce diesel emissions;
Include a certified engine configuration or verified technology that has a long expected useful life;
Maximizes the useful life of any certified engine configuration or verified technology;
Conserves diesel fuel; and
Utilizes ultra low sulfur diesel ahead of EPA’s mandate for non-road applications.

Oregon DEQ will receive $1.7 million in state clean diesel funding for grants. DEQ will also apply for approximately $3.25 million in competitive diesel grant funds under the National Clean Diesel Funding Assistance Program. Several other eligible entities in Oregon plan to apply for the competitive grant funding as well. The goal for both programs is to create jobs and reduce emissions from diesel engines. DEQ projects will focus on exhaust controls and engine upgrades.

The National Clean Diesel Funding Assistance Program is open to state, local, regional and tribal governments with jurisdiction over transportation and air quality, nonprofits representing or providing pollution reduction or educational services to persons or organization that operate diesel fleets, or whose principle purpose is the promotion of transportation or air quality. Applications for competitive grants are due to EPA in late April. DEQ is available to provide support for those entities who wish to develop their own proposals.

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Leaking Underground Storage Cleanups

Oregon expects to receive up to $2.8 million to protect human health and the environment by cleaning up petroleum leaks from underground storage tank sites. The site assessment and cleanup work will largely be performed by private environmental engineering firms under contract to DEQ. Although final guidelines have not yet been issued by the EPA, DEQ has developed a list of approximately 20 sites it believes will be eligible for funding. The highest priority will be given to sites that pose the greatest threat to human health and the environment and lack an owner who can undertake the cleanup.

Brownfield Cleanups

Brownfield grants are typically awarded to local governments to facilitate investigation, cleanup and productive reuse of vacant and underutilized of contaminated properties. EPA has not yet announced how it will select projects for these additional grant funds.

Superfund Site Cleanups

EPA usually cleans up Superfund sites itself, rather than granting funds to DEQ perform the cleanup work. There are currently 12 Oregon sites on the National Priorities List (Superfund). EPA has not yet announced which Oregon sites, if any, will receive funding.

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