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Drinking Water State Revolving Fund (DWSRF) Annual Report

Capitalization Grants

For Period Ending June 30, 2003

State of North Carolina

September 30, 2003

I. INTRODUCTION

Amendments to the Safe Drinking Water Act (SDWA) of 1996 created the Drinking Water State Revolving Fund (DWSRF). Public Law 104-182 established a new Section 1452 in the SDWA which authorized capitalization grants to states. This law also established the qualifying conditions to be met by the states as recipients of the funds and also described the intended uses of the DWSRF. The State of North Carolina herewith submits its Annual Report for the DWSRF program for state fiscal year 2003 (July 1, 2002-June 30, 2003). This report shows the actual use of these funds, and describes how North Carolina has met the goals and objectives of its DWSRF program during fiscal year 2003 as identified in its Intended Use Plan (IUPs) which described the planned use of these funds for project and set-aside purposes.

II. EXECUTIVE SUMMARY

North Carolina has received capitalization grants totaling $100,524,200. The approved IUP included DWSRF monies for projects in the amount of $79,215,518. The state has provided the required 20% match funds of $20,104,840. The remaining portion of the capitalization grant, $21,308,682 was described as non-project or set-aside uses in the IUPs. Supplemental funding for this reporting period included $278,383 interest earned on deposits, as well as loan repayments of $2,813,351 principal and $1,813,069 in interest.

During state fiscal year 2003 North Carolina made 11 new binding commitments to provide assistance for the construction of water supply facilities. These obligations totaled $37,280,101. Other projects had changes in the amount of their original commitments resulting in a net de-obligation of $153,831. Disbursements from North Carolina’s DWSRF to 19 loan recipients totaled $10,506,676. In addition; $2,624,738 was expended during this reporting period for set-aside purposes, including DWSRF program administration; state programs; small system technical assistance; and local assistance and other state programs, as detailed in Exhibit 3 and in this report.

III. GOALS AND ACCOMPLISHMENTS A. Short-Term Goals and Accomplishments

North Carolina identified eight short-term goals in its FY00 IUP, and has worked to meet these program objectives. 1. Implement administrative rules and regulations for the DWSRF program,

consistent with federal priorities.

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Rules, identified as T15A NCAC 1N, and criteria within for decision making, are consistent with the priorities established by the amended Safe Drinking Water Act of 1996 (P.L. 104-182, Section 130) and subsequent guidance documents published February 28, 1997.

2. Provide effective program management to ensure the integrity of the DWSRF.

All programs, including those for proposed projects and for the set-aside functions, have been managed with the highest levels of integrity available from the state.

3. Provide loans to eligible public water systems to address acute health risks as

a priority.

The criteria, developed for awarding priority rating points to applications for low interest loans, provide a greater amount of points to projects that demonstrate acute health risks in need of remediation.

4. Provide loans to eligible public water systems to allow consolidation of non-

viable water systems to form systems with adequate capacity.

Simultaneous to consolidating public water systems experiencing health hazard risks, opportunities to consolidate non-viable water systems are considered as well. This allows eligible viable water systems to supply these customers.

5. Provide funding for preventative and efficiency measures, such as source

water protection and the replacement of aging infrastructure.

Applications for off stream settling basins, upgrading of water treatment plants, and upgrading transmission and distribution lines were given high to medium priority ratings when documentation was provided to show the existing health risk associated with excessive raw water turbidity or insufficient water pressure could be reduced by funding the project.

6. Prevent the formation of new non-viable systems through the capacity development program.

The permanent rules for capacity development took effect on August 1, 2000 to ensure that new systems have technical, financial and managerial capacity. Both the strategy and implementation for North Carolina’s Capacity Development Rules is working well to meet capacity development requirements.

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7. Increase compliance for transient water systems.

The Public Water Supply Section’s field staff continues to provide updated inventory information as they become aware of the needed changes. Maximum contaminant level exceedance letters, monitoring failure notifications and administrative orders are routinely prepared and mailed from the central office in Raleigh.

8. Provide the required State match within the required time frame.

State match for the Federal FY 2001 capitalization grant received during the reporting period was provided by the sale of bonds as authorized by the 1998 NC Legislature.

B. Long-Term Goals and Accomplishments

North Carolina continues to work on the following eight long-term commitments that were included in its prior IUPs.

1. Support the North Carolina goal to assure safe and healthy drinking water for

state residents and visitors served by public water supplies.

The program activities, both project and non-project, place a great emphasis on assuring provision of safe and healthy drinking water by all public water systems. The state program and small systems technical assistance set-asides have enabled the state to place greater attention on the transient, non-community public water systems which, though the smallest, are the most numerous.

2. Increase the percent of the population served by safe public water systems.

Funding service area expansion projects that address areas with contaminated private wells raises the state’s overall level of public health protection.

Constant monitoring of analytical results for regulated and unregulated contaminants ensures that the highest percent of the state’s population are being served drinking water from safe public water systems.

3. Increase the safety of public water systems.

The award of DWSRF monies to public water system upgrade proposals allows the safety of existing public water systems to be increased. Additionally small system technical assistance, and resultant inspections identify deficiencies that must be satisfied to remain in compliance with state and federal requirements. In addition, NCPWSS staff has worked to facilitate vulnerability assessment training for water systems.

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4. Provide assistance to public water systems in maintaining the health objectives of the SDWA.

In addition to the improvements to existing water systems made possible by project funding, a great emphasis is now being placed on prevention of entry of threatening contaminants through the implementation of a source water assessment program and its subcomponents, like wellhead protection. These activities, as well as the other set-asides, are described in more detail in the Program Details, Section IV, in this report.

5. Assist water systems in complying with new SDWA rules as they are implemented. Assistance is provided with new rules to the extent resources allow. Limited DWSRF funding supports this goal. Informational mailings are sent periodically to water systems on specific issues and staff participation on numerous operator schools and training classes.

6. Maintain the fiscal integrity of the DWSRF to assure continuance of loan funds for future generations.

As revolving loan principal repayments and interest payments are received, they will be deposited to an account dedicated to disbursement for new loan purposes. Interest earned on these deposits will also be credited to the account.

7. Maintain the DWSRF in perpetuity.

The rules established for the implementation of the program for low interest loans for projects included provisions for establishing a two percent administrative fee. This, coupled with the revolving loan aspect, allows replenishment of funds for future high priority public health and compliance projects, and their administration. DWSRF program does not include interest free or principal forgiveness loans.

8. Implement a capacity development strategy that will result in improved

water system compliance.

The strategy for implementing North Carolina's Capacity Development Program was submitted on August 23, 2000 and approved on September 21, 2000. The report on EPA SNC Compliance was sent to EPA on July 11, 2003.

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IV. PROGRAM DETAILS A. Fund Financial Status

1. Sources of Funds

Exhibit 4 shows the sources of project funds for state fy 2003. During this period, the State received its 2001 capitalization grant of $14,065,400. Other state fy 2003 sources included $278,383 in interest earned on deposits, $1,798,548 in state match, and $4,626,420 (principal and interest) in loan repayments.

2. Projects

The State of North Carolina entered into 11 original binding commitments during fiscal year 2003. Including increases and decreases to other projects the total committed through June 30, 2003 was $102,598,640. By the end of state fy 2003, there was $2,458,753 in project funds remaining to be committed which includes $2,060,018 from the FY 2001 Capitalization Grant.

3. Payments to Automated Clearinghouse (ACH)

Exhibit 3 shows the Schedules of Payments to the ACH. Exhibit 2 shows binding commitments as compared to the payment schedule.

4. Disbursements

Total disbursements during FY 2003, as shown in Exhibit 3, consisted of $10,506,676 disbursed to projects and $2,624,738 expended for set aside activities.

5. Loan Repayments

As reflected in Exhibit 4, loan principal repayments during the fiscal year on 35 projects totaled $2,813,351 with interest received on loans totaling $1,813,069. Of this amount, $63,497 principal and $17,544 interest was deposited with the North Carolina State Controller’s Office. These funds will be held in escrow until the retirement of the bonds that were sold to provide match to the 1998-2001 Capitalization Grants.

6. Loan Administrative Fee

Exhibit 5 reflects activity associated with loan administrative fees.

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During the reporting period, fees totaling $491,450 were paid by 8 applicants. Interest earned on funds in the Loan Administrative Fee Account totaled $63,895.

7. Financial Statements

The Financial Statements, presented as Exhibit 8, differ from prior years, as North Carolina has moved its SRF funds into Proprietary Funds rather than the previous Trust Fund classification. This was done in deference to EPA’s preference for the proprietary accounting approach for these funds. The new financial statements reflect this change. Revenues and expenditures reflected in these financial statements are reported on the accrual basis. The preceding Exhibits 1 through 7 are prepared on the cash basis, in keeping with the method used to compile DWSRF data in the National Information Management System (NIMS).

B. Assistance Activity

Exhibits 6 and 7 illustrate the project assistance activity of the fund for the period ending June 30, 2003. Exhibit 6 shows the projects with which North Carolina’s DWSRF has entered into binding commitments for low interest loans during the period. Exhibit 7 shows the assistance amount provided to each project by needs category.

C. Conditions of the Grant The North Carolina State Auditor’s Office conducts an annual audit of the DWSRF.

Audit procedures are conducted in accordance with Generally Accepted Auditing Standards and Government Auditing Standards issued by the Comptroller General of the United States. The State Auditor Report for the last fiscal year disclosed no instances of non-compliance with Terms and Conditions of the DWSRF Grant.

D. Set-Aside Program Reports The following report on set-asides is presented in the order described in the approved

Intended Use Plans.

1. Program Administration (up to 4% of Capitalization Grant).

This set-aside was used for salaries, fringe benefits, indirect cost, operating expenses, office supplies and furniture, office space leasing, computer system programming and services, and equipment purchases. Total annualized amounts for the support of the administrative personnel are dependent upon prior award year fund depletion rates. The flexibility in the DWSRF

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authorized by the SDWA permits this agency to request the full set-aside and adjust the amount and timing of spending to administer the program in a timely and efficient manner. This agency applied for the full 4 percent Administration Set-aside of approximately $562,616. The DWSRF program assesses a 2 percent closing cost. This provides approximately $270,000 per year to supplement program administrative expenses.

The primary goal was to use the resources available through the DWSRF Capitalization Grant to provide maximum services allowed by the set-aside programs and to provide low-interest loans to projects with the greatest public health, compliance and affordability needs. Objectives met for the past year were to:

Set aside sufficient funds to administer the program in perpetuity. Maximize the efficient use of these funds. Administer the DWSRF program in an efficient and comprehensive manner.

The following services were provided:

Low interest loans to eligible local units of government for allowable projects. Completion of all processes associated with the loans to ensure applicants receive their project cost reimbursement disbursements on a timely basis. Monitored payback schedules to ensure principal and interest payments are available on a timely basis for future year awards as low-interest loans. Made progress inspections of construction sites to verify use of state revolving funds as intended. Monitored the set-aside expenditures to prevent over-expenditure of authorized amounts and limits.

Annual reports prepared showing how the state has met its goals and objectives of the past year.

Annual audits performed meeting standards of the General Accounting Office, including auditor’s opinions, reports on internal controls, and compliance adherence.

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The following goal was not achieved:

Develop and use a DWSRF Information Management System to meet quarterly and annual financial and project management reporting requirements for the federal DWSRF Information System, along with other state reporting needs.

2. Technical Assistance for Small Systems. (up to 2% of Capitalization Grant)

The State continued to provide technical assistance to small water systems. This funding, used jointly by the NCPWSS and the North Carolina Rural Water Association (NCRWA) continued workplan activities as necessary to achieve maximum utilization. The NCPWSS continued its support of 3 Environmental Technical IV positions in Regional Offices. These offices provided technical assistance to systems during 2,321 sanitary surveys and 6,041 total on-site contacts during the period from January 1, 2002 to December 31, 2002. NCRWA’s contract was continued in support of a circuit rider position that provided 406 contacts of technical assistance during the period from July 1, 2002 to June 30, 2003. These contacts involved dialog with water system personnel in accordance with the activities and assistance described in the IUP.

3. Drinking Water State Program Management Functions (up to 10% of Capitalization

Grant).

i. Administration of PWSS Supervision Program.

North Carolina has increased enforcement actions for non-compliant transient systems and has simplified the public notification process, in general, for all water systems. In April 2003, administrative penalties were sent to non-compliant transient systems that did not perform their required quarterly analysis for total coliform bacteria. Also, in April 2003, administrative orders were sent to systems that were delinquent in their 2001 and 2002 nitrate analyses. As follow-up to these orders, we plan issue administrative penalties to any of these systems that remain non-compliant in August 2003. To simplify the public notification process, when any enforcement letters are sent to non-compliant systems, the public notices that are attached for their use already include the mandatory language and are formatted to meet the requirements of the rule. Much of the required information such as system name, identification number and the compliance periods missed are already inserted into the notice.

ii. Administration or technical assistance activities for source water protection.

From July 1, 2002 to June 30, 2003, the Source Water Protection (SWP) Program Manager continued to work in support of the Source Water

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Assessment Program (SWAP) and the existing state Wellhead Protection Program. The SWP Manager assisted with the development of web page content for the SWAP project. PWS system owners will be able to download their SWAP assessment report from this web site. In addition to the assessment report the web site has been designed to offer information on source water protection including the following elements:

• Protecting the Water You Drink: Information about source water protection for watersheds and wells

• Learn about SWP • SWP Success Stories in NC • Wellhead Protection Program (WHP), • Water Supply Watershed Program (WSWP) • Funding & Other Resources for SWP

The Source Water Protection program manager planned and led the efforts to conduct four Source Water Protection workshops in four different locations across the state. During these workshops the important elements of the Source Water Assessment reports were described and typical maps, tables and figures were presented. Invited guest speakers presented information about source water protection including:

• technical assistance from state and federal agencies as well as non-

profit land conservation groups • examples of source water protection efforts involving education and

outreach • community planning and involvement • conservation funding sources for promoting source water protection.

iii. Development and implementation of a capacity development strategy.

Activities identified in the Capacity Development Status Reports of 2000 (Strategy) and 2001 (Implementation) are working well for North Carolina. By sharing the workload among its staff, NCPWSS is successfully implementing the capacity development program. Office assistants in the Central Office log in and send the engineering reports to regional offices and generate and mail “Authorization to Construct” letters as appropriate. Plan review engineers are now reviewing both the engineering reports and water system management plans. These capacity development documents are reviewed for completeness. NCPWSS field personnel are providing on-site technical assistance to help systems meet capacity development requirements.

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Other Capacity Development activities during the past year include:

a. Convened task force to study enforcement improvements, b. Participated in Area Wide Optimization Program (AWOP), c. Performed non-compliance Comprehensive Performance Evaluations

(CPEs) at water treatment plants to evaluate treatment process and provide performance improvements in addition to performance-based training (PBT) for plant personnel,

d. Participated in Capacity Development Workshop, e. Managed Counter Terrorism Grants and f. Provided vulnerability assessment and emergency response training

assistance: (1) By congressional appropriation, the Environmental Protection

Agency (EPA) awarded grant funds to North Carolina in the amount of $721,600.00 during October, 2002. Their primary use is to provide coordination assistance, particularly with training needed by the CWS owners, managers, and operators to prepare the Vulnerability Assessment (VA) and Emergency Response Plan (ERP) documents. Toward this end, the Public Water Supply Section has negotiated with NC AWWA and NC Rural Water Association (NCRWA) for the necessary training for systems serving from 10,000 up to 99,999 persons. Systems serving 100,000 persons or more received direct grants from EPA for these purposes. And NCRWA received EPA training funds through its parent national organization to provide the necessary training to the systems serving from 3300 to 9,999 persons.

(2) The grant work plan also allows pass through funds to water

systems serving from 20,000 through 99,999 persons. NC has thirty-six such systems, although only 33 contracts are being awarded since three of the systems are federally owned and not eligible for the pass through funds. About sixty state employees, both from DENR and other state response agencies, have been receiving the vulnerability assessment training. This training is expected to lead to the development of a Procedures Manual which will address the handling of suspect contaminants and communication strategies between state agencies, the primary water system involved, and the public.

iv. Implementation of the Operator Certification Program.

A contract with the North Carolina Waterworks Operators Association (NCWOA) was continued to fund a registrar position to support operator training statewide. This registrar position coordinated the operator training

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activities of the NCWOA, the North Carolina Rural Water Association, the North Carolina American Water Works Association, and the Public Water Supply Section. The registrar published quarterly training calendars and supplied them to operators in the form of a newsletter brochure. This individual provided the administration, evaluation, and record keeping for the two NCWOA operator training schools and the two NCAWWA distribution schools. This included: school brochure preparation, mailing, coordination of mailing lists, receipt of fees and school applications, review of applications, deposits and tracking of training expenses, coordination of classroom facilities, audio-visual equipment and breaks, preparation of registration packages, coordination of registration desk, printing of training materials, tracking of attendance and record-keeping of contact hours completed. In addition the registrar kept records on the continuing education hours completed by operators attending the seminars, workshops, and conferences. The Operator Certification Expense Reimbursement Grant was approved by EPA and will support the registrar position in future years instead of this set-aside.

4. Local Assistance and other State programs (up to 15% of Capitalization Grant).

i. Delineation and assessment of source water protection areas--public water systems. Not available as continuing set-aside.

The assessment of the nearly 10,500 public sources of drinking water in the state require the integration and analysis of spatial data in the form of GIS coverages with tabular data and the output in the form of maps, text and web pages. Programming code to automate this process is required. This will be accomplished with the assistance of contract programmers in conjunction with NCPWSS staff. In January 2002, a contractor began developing the programming code for the computer application designed to automate the calculation of SWAP results and the creation of the SWAP reports. According to the original contractor schedule the application was to have been completed in August 2002. However, during the period from July 1, 2002 through June 30, 2003 the development of the computer application required a series of reviews including product testing and evaluation by PWS Section staff. The contractor was informed of errors detected during each round of acceptance testing and required to correct the application appropriately. As of June 30, 2003 the development of the SWAP computer application was approximately 90 percent complete with an anticipated completion in August 2003. If the application is completed in August 2003 the schedule for development will have been extended by 12 months. The cost for the contractor, software and hardware to develop the application has not been adversely impacted by the schedule delays, however the time and resources spent by the PWS Section staff on testing and related documentation has been far greater than anticipated. As a result of the SWAP computer application development delays, the PWS Section

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submitted a request to EPA Region 4 on August 22, 2002 for an extension until June 2004 to complete the source water assessments. On November 21, 2002 EPA approved the schedule extension. In accordance with the Amendment to North Carolina’s FY 1997 DWSRF Intended Use Plan as approved in February, 2003, funds unspent as of May 4, 2003 were transferred to the Wellhead Protection set aside. This amount ($2,720,809) included the ongoing contract with the NC Center for Geographic Information and Analysis, which had a remaining balance of $92,969. During the SWAP computer application development delay, Potential Contaminant Source (PCS) databases were updated and amended. Data inputs required for delineation and assessment have also been updated for use in the draft source water assessments that will be provided to water system owners for their review.

As of June 30, 2003 the PWS Section had completed work to obtain GPS location data for active wells. This database is dynamic with new wells coming on-line routinely.

ii. Establishment and implementation of a wellhead protection program.

From July 1, 2002 through June 30, 2003 the PWSS received 19 local wellhead protection (WHP) plans submitted for review and approval. These newly submitted plans bring the total received to date to 118. Of these 118 plans, 51 had received approval prior to the current reporting period. The majority of the remaining plans were under active review during the current reporting period. Active review included generating review letters requesting additional information and/or clarification regarding the information submitted with the local WHP plans as well as attending numerous meetings with the parties involved in the plan development (e.g., local government officials, consultants, NCRWA staff, etc.). During the current reporting period, 11 additional WHP plans received approval. This brings the total number of systems with approved WHP plans in North Carolina to 62. These 62 systems comprise 257 public water supply wells serving a population of 206,841.

As part of the WHP plan review process, NCPWSS staff reviewed draft wellhead protection area (WHPA) maps submitted by public water supply systems. This allows the public water supply system to receive tentative approval of their WHPAs prior to proceeding with development of the remaining WHP plan components (i.e., potential contamination source inventory, management plan, etc.). Also, as part of the WHP plan review

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process, NCPWSS staff continued the development and maintenance of an MS Access database for tracking State WHP Program information.

From July 1, 2002 through June 30, 2003, NCPWSS staff continued to provide WHP Program information to interested parties upon request. The information provided included WHP plan requirements, copies of the North Carolina Wellhead Protection Guidebook, lists of public water supply systems with approved WHP plans, maps of approved WHPAs, and aquifer recharge rates necessary for the calculation of the size of WHPAs. Information requests frequently originated from environmental consultants conducting limited site assessments (LSAs) as part of a risk based analysis of sites with soil and/or ground water contamination. These LSAs require the identification of all public water supply wells and WHPAs within a 1500-foot radius of the contaminated site. NCPWSS staff continued to provide information regarding the location of approved WHPAs to the State’s Division of Waste Management (DWM). The DWM is responsible for review of LSAs and oversight of remediation efforts conducted at sites with ground-water contamination resulting from leaking petroleum underground storage tanks. To improve the efficiency of providing WHP Program information, NCPWSS staff continued the development of an internet website where this information can be obtained. As of June 30, 2003 information available on this website included WHP plan requirements, a downloadable version of the North Carolina Wellhead Protection Guidebook (PDF format), and a list of approved WHP plans. Maps of approved WHPAs and associated public water supply wells were removed from the website following the terrorist attacks of September 11, 2001. NCPWSS staff continued to develop and maintain ArcView GIS shapefiles for all approved WHPAs. A decision as to whether or not to deploy these shapefiles on the internet is currently being held in abeyance until security issue are resolved. NCPWSS staff continued the development of WHPA shapefiles for newly approved WHP plans. Printed copies of WHPA maps produced from these shapefiles were included with approval letters sent to public water supply systems. Copies of these maps were also provided to Regional Office staff and to the State’s Division of Waste Management. Electronic copies of maps were also provided upon request via email to environmental consultants conducting limited site assessments as part of a risk based analysis of sites with soil and/or ground water contamination.

The NCPWSS staff continued to provide information regarding the North Carolina Division of Pollution Prevention and Environmental Assistance (DPPEA) to local governments and public water supply systems developing WHP plans. This included providing these systems with educational flyers describing services offered by the DPPEA. These flyers are distributed to businesses visited by public water supply system staff while conducting potential contamination source inventories as part of WHP plan development.

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The DPPEA provides free technical and other non-regulatory assistance to reduce the amount of waste released into the air and water and on the land. The DPPEA serves as a central repository for waste reduction and pollution prevention information.

On February 21, 2002 the NCPWSS and the North Carolina Rural Water Association (NCRWA) entered into an agreement (Amendment No. 1, Contract No. T01007) for NCRWA to continue providing assistance to public water supply systems in the development of local WHP plans. This contract provided the NCRWA with funding for two full-time ground-water technicians and one administrative support position through March 31, 2003. The two ground-water technicians assist and guide communities through a step by step process to develop and implement WHP plans that are customized for their community. On April 1, 2003, the NCPWSS and the NCRWA entered into a new agreement (Contract No. T03139). In order to put this and future contracts on a state fiscal year footing, the new contract runs through June 30, 2004, a period of 15 months. This contract will continue to provide the NCRWA with two full-time ground water technicians and an administrative technical support position for the development of new WHP plans. Additionally, the new contract includes incentives for assisting public water supply systems in obtaining approval of WHP Plans that had been previously submitted but had failed to receive approval due to defined deficiencies. During September and October of 2002, NCPWSS staff conducted four Source Water Assessment and Protection Workshops across the state. These one-day workshops afforded local government and water system managers and others interested in local planning and water supply protection the opportunity to learn about the soon to be available Source Water Assessment Program (SWAP) reports and other resources available for local drinking water source protection. These workshops, which included presentations on North Carolina’s WHP Program were held in Greenville (9/23/02), Carrboro (9/25/02), Winston-Salem (10/3/02), and Asheville (10/4/02).

From July 1, 2002 through June 30, 2003, the NCPWSS staff participated in numerous meetings and conferences with local officials interested in developing local WHPPs. NCPWSS staff also coordinated with representatives from the NCRWA to continue the process of developing and refining the WHPP approval criteria and process.

During the current reporting period, NCPWSS staff continued oversight of work conducted by an outside contractor hired to provide services for the continued development and enhancement of the State’s WHP Program. The contract involved the development of a user-friendly WHP guidance document specific to North Carolina. The revised guidance document was completed during the current reporting period and is a major revision to the

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existing North Carolina Wellhead Protection Guidebook. The target audience of this document is local elected officials, as well as town and county employees such as managers, clerks, and operators of public water supply systems. A user friendly guidance document in a form that the target audience can use will increase the amount of progress the communities can make independently. Making the planning process simpler to understand and more accessible will encourage more communities to develop WHP plans, thus providing better protection for our State’s ground water sources of drinking water.

From July 1, 2002 through June 30, 2003, WHP Program staff continued to support the development of the SWAP Program. This support took the form of providing input at internal SWAP meetings, providing review and analysis of work products generated by the Program, providing review and analysis of hydrogeologic data relevant to the delineation and assessment component of the Program, attending meetings with contractors, and reviewing and commenting on work products submitted by contractors.

E. Transfer of Funds from Set-Asides into Standard Project Accounts. No transfer of funds from set-asides into standard project accounts occurred. F. MBE/WBE Requirements.

The MBE/WBE percentage of procurement awarded during FY 2003 was 0.4 % for MBE ($82,921) and 0.08% for WBE ($17,635) as reported on EPA Form 5700-52A’s.

V. PROJECT CHANGES

The following reflects changes from the FY97 Comprehensive Project Priority List (CPPL) in the IUP not previously reported: Sampson County Water and Sewer District II - Binding Commitment October 16, 2000, Contracts awarded, project complete, reviewing Part B prior to requesting promissory note and making disbursement. Plymouth, Town of - Bypassed, on 1997 list. Binding commitment and loan agreement against 1998 funds for $1,013,009. Two components of project, annex area waterlines and WTP rehab. completed. New well site being evaluated since first test well was too saline.

Havelock, City of - Bypassed on 1997 list. Binding commitment and loan agreement against 1998 funds for $2,907,000. Project nearing completion.

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Andrews, Town of – Commitment increased by $123,306 to construct a floating intake to improve raw water quality entering WTP.

Tryon, Town of – Commitment increased by $40,043 to cover final costs for completed project.

Tuckaseigee Water and Sewer Authority – project completed for $24,827 less than previous commitment.

Henderson, City of - project completed for $42,303 less than previous commitment. The following reflects changes from the FY98 CPPL in the IUP not previously reported:

Albertson Water and Sewer District - Project completed. Awaiting closeout and appropriately $175,000 reduction in commitment. Statesville, City of, Phase 1B - Project nearing completion.

The following reflects changes from the FY99 CPPL in the IUP not previously reported: West Jefferson, Town of – Commitment increased $28,513 due to conditions

encountered during construction. Project completed. The following reflects changes from the FY2000 CPPL in the IUP not previously reported:

Spring Lake, Town of - Transmission main from Harnett County – project completed with a $278,563 reduction in the SRF loan amount.

Funds Current Prior CumulativeAvailable Fiscal Year Fiscal Years To Date Balance

Set Asides

Administration 4,020,968$ 528,113$ 1,629,064$ 2,157,177$ 1,863,791$

Technical AssistanceNC Rural Water Association 410,200$ 63,130$ 183,911$ 247,041$ 163,159$ NC Public Water Supply 1,111,043$ 139,270$ 587,342$ 726,612$ 384,431$ Other Contracts 489,241$ -$ 522,271$ 522,271$ (33,030)$ Total Technical Assistance 2,010,484$ 202,400$ 1,293,524$ 1,495,924$ 514,560$

State Program FunctionsPWSS Program 5,566,482$ 809,886$ 2,469,887$ 3,279,773$ 2,286,709$ Source Water Protection 335,096$ 62,000$ 211,096$ 273,096$ 62,000$ Capacity Development 323,639$ 62,000$ 199,639$ 261,639$ 62,000$ Operator Certification - Waterworks Op. Assn. 464,600$ 97,700$ 269,200$ 366,900$ 97,700$ Total State Program Functions 6,689,817$ 1,031,586$ 3,149,822$ 4,181,408$ 2,508,409$

Local Assistance and Other State ProgramsDelineation & Assessment

NC Public Water Supply 1,105,625$ 355,904$ 749,721$ 1,105,625$ -$ NC Center for Geographic Info & Analysis 7,031$ 1,742$ 5,289$ 7,031$ -$ Other Contracts 731,023$ -$ 731,023$ 731,023$ -$ Reserve for remaining years of work -$ -$ -$ -$ -$ Total Delineation & Assessment 1,843,679$ 357,646$ 1,486,033$ 1,843,679$ -$

Wellhead ProtectionNC Public Water Supply 3,678,939$ 313,954$ 576,591$ 890,545$ 2,788,394$ NC Rural Water Assn. 929,500$ 186,699$ 557,701$ 744,400$ 185,100$ NC Center for Geographic Info & Analysis 92,969$ -$ -$ -$ 92,969$ Other Contracts 2,042,326$ 4,341$ 496,587$ 500,928$ 1,541,398$ Total Wellhead Protection 6,743,734$ 504,994$ 1,630,879$ 2,135,873$ 4,607,861$

Total Local Assistance & Other State Programs 8,587,413$ 862,640$ 3,116,912$ 3,979,552$ 4,607,861$

Total Set Asides 21,308,682$ 2,624,739$ 9,189,322$ 11,814,061$ 9,494,621$

ProjectsFederal Share 79,215,518$ 8,340,440$ 41,507,556$ 49,847,996$ 29,367,522$ State Share 20,104,840$ 2,166,236$ 10,625,338$ 12,791,574$ 7,313,266$ Total Projects 99,320,358$ 10,506,676$ 52,132,894$ 62,639,570$ 36,680,788$

Total Capitalization Grants 120,629,040$ 13,131,415$ 61,322,216$ 74,453,631$ 46,175,409$

Recap:Total Federal Funds 100,524,200$ 10,965,179$ 50,696,878$ 61,662,057$ 38,862,143$ Total State Funds 20,104,840$ 2,166,236$ 10,625,338$ 12,791,574$ 7,313,266$

Total Capitalization Grants 120,629,040$ 13,131,415$ 61,322,216$ 74,453,631$ 46,175,409$

SeeSummary: Exhibit1997 Capitalization Grant 1-A 55,336,920$ 2,430,578$ 48,830,500$ 51,261,078$ 4,075,842$ 1998 Capitalization Grant 1-B 15,431,280$ 3,639,558$ 9,145,793$ 12,785,351$ 2,645,929$ 1999 Capitalization Grant 1-C 16,173,480$ 5,692,405$ 3,203,358$ 8,895,763$ 7,277,717$ 2000 Capitalization Grant 1-D 16,808,880$ 1,368,874$ 142,565$ 1,511,439$ 15,297,441$ 2001 Capitalization Grant 1-E 16,878,480$ -$ -$ -$ 16,878,480$

Total Program Funding 120,629,040$ 13,131,415$ 61,322,216$ 74,453,631$ 46,175,409$

Note: The extent to which funds have been expended does not reflect an absence ofcommitment of unspent funds. It should be noted that, in fact, all grant funds awardedhave been committed as defined in the approved EPA Work Plan and Intended UsePlans.

Exhibit 1

Capitalization Grants Summary

Federal Grant Years 1997 - 2001

-------------------- Disbursements --------------------

NORTH CAROLINADRINKING WATER STATE REVOLVING FUND

Annual ReportJune 30, 2003


Set Asides

Administration 1,844,564$ 95,530$ 1,629,064$ 1,724,594$ 119,970$

Technical AssistanceNC Rural Water Association 82,800$ -$ 49,770$ 49,770$ 33,030$ NC Public Water Supply 350,241$ -$ 350,241$ 350,241$ -$ Other Contracts 489,241$ -$ 522,271$ 522,271$ (33,030)$ Total Technical Assistance 922,282$ -$ 922,282$ 922,282$ -$

State Program FunctionsPWSS Program 1,011,465$ -$ 1,011,465$ 1,011,465$ -$ Source Water Protection 76,234$ -$ 76,234$ 76,234$ -$ Capacity Development 70,508$ -$ 70,508$ 70,508$ -$ Operator Certification - Waterworks Op. Assn. 90,600$ -$ 90,600$ 90,600$ -$ Total State Program Functions 1,248,807$ -$ 1,248,807$ 1,248,807$ -$

Local Assistance and Other State ProgramsDelineation & Assessment (1)

NC Public Water Supply 1,105,625$ 355,904$ 749,721$ 1,105,625$ -$ NC Center for Geographic Info & Analysis 7,031$ 1,742$ 5,289$ 7,031$ -$ Other Contracts 731,023$ -$ 731,023$ 731,023$ -$ Reserve for remaining years of work -$ -$ -$ -$ -$ Total Delineation & Assessment 1,843,679$ 357,646$ 1,486,033$ 1,843,679$ -$

Wellhead Protection (1)NC Public Water Supply 2,402,821$ 164,368$ 177,151$ 341,519$ 2,061,302$ NC Rural Water Assn. 189,100$ -$ 189,100$ 189,100$ -$ NC Center for Geographic Info & Analysis 92,969$ -$ -$ -$ 92,969$ Other Contracts 822,025$ -$ 372,933$ 372,933$ 449,092$ Total Wellhead Protection 3,506,915$ 164,368$ 739,184$ 903,552$ 2,603,363$

Total Local Assistance & Other State Programs 5,350,594$ 522,014$ 2,225,217$ 2,747,231$ 2,603,363$

Total Set Asides 9,366,247$ 617,544$ 6,025,370$ 6,642,914$ 2,723,333$

Projects

Federal Share 36,747,853$ 1,445,346$ 34,124,158$ 35,569,504$ 1,178,349$ -$ State Share 9,222,820$ 367,688$ 8,680,972$ 9,048,660$ 174,160$

Total Projects 45,970,673$ 1,813,034$ 42,805,130$ 44,618,164$ 1,352,509$

Total 1997 Capitalization Grant 55,336,920$ 2,430,578$ 48,830,500$ 51,261,078$ 4,075,842$

Recap:

Total Federal Funds 46,114,100$ 2,062,890$ 40,149,528$ 42,212,418$ 3,901,682$

Total State Funds 9,222,820$ 367,688$ 8,680,972$ 9,048,660$ 174,160$


(1) In accordance with the Amendment to North Carolina's FY1997 DWSRF Intended Use Plan as approved in February, 2003, funds unspent as of May 4, 2003 were transferred to the Wellhead Protection set aside. This amount ($2,720,809) includedthe ongoing contract with the NC Center for Geographic Information and Analysis, which had a remaining balance of $92,969




Exhibit 1-A

1997 Capitalization Grant

Summary

-------------------- Disbursements --------------------


Set Asides

Administration 514,376$ 432,583$ -$ 432,583$ 81,793$

Technical AssistanceNC Rural Water Association 80,300$ -$ 80,300$ 80,300$ -$ NC Public Water Supply 176,888$ 809$ 171,917$ 172,726$ 4,162$ Other Contracts -$ -$ -$ -$ -$ Total Technical Assistance 257,188$ 809$ 252,217$ 253,026$ 4,162$

State Program FunctionsPWSS Program 1,050,458$ 1,125$ 1,044,873$ 1,045,998$ 4,460$ Source Water Protection 77,254$ -$ 77,254$ 77,254$ -$ Capacity Development 73,628$ -$ 73,628$ 73,628$ -$ Operator Certification - Waterworks Op. Assn. 84,600$ -$ 84,600$ 84,600$ -$ Total State Program Functions 1,285,940$ 1,125$ 1,280,355$ 1,281,480$ 4,460$

Local Assistance and Other State ProgramsWellhead Protection

NC Public Water Supply 153,559$ 10,596$ 118,983$ 129,579$ 23,980$ NC Rural Water Assn. 185,100$ 502$ 184,598$ 185,100$ -$ Other Contracts 70,301$ 2,000$ 68,301$ 70,301$ -$

Total Local Assistance & Other State Programs 408,960$ 13,098$ 371,882$ 384,980$ 23,980$

Total Set Asides 2,466,464$ 447,615$ 1,904,454$ 2,352,069$ 114,395$

Projects

Federal Share 10,392,936$ 2,523,709$ 5,725,368$ 8,249,077$ 2,143,859$

State Share 2,571,880$ 668,234$ 1,515,971$ 2,184,205$ 387,675$

Total Projects 12,964,816$ 3,191,943$ 7,241,339$ 10,433,282$ 2,531,534$


Recap:


Total State Funds 2,571,880$ 668,234$ 1,515,971$ 2,184,205$ 387,675$





Exhibit 1-B


Summary

-------------------- Disbursements --------------------


Set Asides

Administration 539,116$ -$ -$ -$ 539,116$

Technical AssistanceNC Rural Water Association 80,300$ -$ 53,841$ 53,841$ 26,459$ NC Public Water Supply 189,258$ 138,461$ 65,184$ 203,645$ (14,387)$ Other Contracts -$ -$ -$ -$ -$ Total Technical Assistance 269,558$ 138,461$ 119,025$ 257,486$ 12,072$

State Program FunctionsPWSS Program 1,140,679$ 742,797$ 397,882$ 1,140,679$ -$ Source Water Protection 57,608$ -$ 57,608$ 57,608$ -$ Capacity Development 55,503$ -$ 55,503$ 55,503$ -$ Operator Certification - Waterworks Op. Assn. 94,000$ -$ 94,000$ 94,000$ -$ Total State Program Functions 1,347,790$ 742,797$ 604,993$ 1,347,790$ -$


NC Public Water Supply 153,559$ -$ 153,559$ 153,559$ -$ NC Rural Water Assn. 185,100$ 1,097$ 184,003$ 185,100$ -$ Other Contracts 550,000$ 2,341$ 55,353$ 57,694$ 492,306$


Total Set Asides 3,045,123$ 884,696$ 1,116,933$ 2,001,629$ 1,043,494$

Projects

Federal Share 10,432,777$ 3,820,566$ 1,658,030$ 5,478,596$ 4,954,181$

State Share 2,695,580$ 987,143$ 428,395$ 1,415,538$ 1,280,042$

Total Projects 13,128,357$ 4,807,709$ 2,086,425$ 6,894,134$ 6,234,223$


Recap:


Total State Funds 2,695,580$ 987,143$ 428,395$ 1,415,538$ 1,280,042$


Note:The extent to which funds have been expended does not reflect an absence ofcommitment of unspent funds. It should be noted that, in fact, all grant funds awardedhave been committed as defined in the approved EPA Work Plan and Intended UsePlans.

Exhibit 1-C


Summary

-------------------- Disbursements --------------------




Set Asides

Administration 560,296$ -$ -$ -$ 560,296$

Technical AssistanceNC Rural Water Association 83,400$ 63,130$ -$ 63,130$ 20,270$ NC Public Water Supply 196,748$ -$ -$ -$ 196,748$ Other Contracts -$ -$ -$ -$ -$ Total Technical Assistance 280,148$ 63,130$ -$ 63,130$ 217,018$

State Program FunctionsPWSS Program 1,179,040$ 65,964$ 15,667$ 81,631$ 1,097,409$ Source Water Protection 62,000$ 62,000$ -$ 62,000$ -$ Capacity Development 62,000$ 62,000$ -$ 62,000$ -$ Operator Certification - Waterworks Op. Assn. 97,700$ 97,700$ -$ 97,700$ -$ Total State Program Functions 1,400,740$ 287,664$ 15,667$ 303,331$ 1,097,409$


NC Public Water Supply 503,000$ 138,990$ 126,898$ 265,888$ 237,112$ NC Rural Water Assn. 185,100$ 185,100$ -$ 185,100$ -$ Other Contracts 300,000$ -$ -$ -$ 300,000$


Total Set Asides 3,229,284$ 674,884$ 142,565$ 817,449$ 2,411,835$

Projects

Federal Share 10,778,116$ 550,819$ -$ 550,819$ 10,227,297$

State Share 2,801,480$ 143,171$ -$ 143,171$ 2,658,309$

Total Projects 13,579,596$ 693,990$ -$ 693,990$ 12,885,606$

Total 2000 Capitalization Grant 16,808,880$ 1,368,874$ 142,565$ 1,511,439$ 15,297,441$

Recap:

Total Federal Funds 14,007,400$ 1,225,703$ 142,565$ 1,368,268$ 12,639,132$

Total State Funds 2,801,480$ 143,171$ -$ 143,171$ 2,658,309$

Total 2000 Capitalization Grant 16,808,880$ 1,368,874$ 142,565$ 1,511,439$ 15,297,441$




Exhibit 1-D


Summary

-------------------- Disbursements --------------------


Set Asides

Administration 562,616$ -$ -$ -$ 562,616$

Technical AssistanceNC Rural Water Association 83,400$ -$ -$ -$ 83,400$ NC Public Water Supply 197,908$ -$ -$ -$ 197,908$ Total Technical Assistance 281,308$ -$ -$ -$ 281,308$

State Program FunctionsPWSS Program 1,184,840$ -$ -$ -$ 1,184,840$ Source Water Protection 62,000$ -$ -$ -$ 62,000$ Capacity Development 62,000$ -$ -$ -$ 62,000$ Operator Certification - Waterworks Op. Assn. 97,700$ -$ -$ -$ 97,700$ Total State Program Functions 1,406,540$ -$ -$ -$ 1,406,540$


NC Public Water Supply 466,000$ -$ -$ -$ 466,000$ NC Rural Water Assn. 185,100$ -$ -$ -$ 185,100$ Other Contracts and Equipment 300,000$ -$ -$ -$ 300,000$

Total Local Assistance & Other State Programs 951,100$ -$ -$ -$ 951,100$

Total Set Asides 3,201,564$ -$ -$ -$ 3,201,564$

Projects

Federal Share 10,863,836$ -$ -$ -$ 10,863,836$

State Share 2,813,080$ -$ -$ -$ 2,813,080$

Total Projects 13,676,916$ -$ -$ -$ 13,676,916$

Total 2001Capitalization Grant 16,878,480$ -$ -$ -$ 16,878,480$

Recap:

Total Federal Funds 14,065,400$ -$ -$ -$ 14,065,400$

Total State Funds 2,813,080$ -$ -$ -$ 2,813,080$

Total 2001Capitalization Grant 16,878,480$ -$ -$ -$ 16,878,480$


Exhibit 1-E


Summary

-------------------- Disbursements --------------------



ProjectNumber Total Prior ------------------------------ Quarter Ending ---------------------------------

Project Name (DEH-) Award Years 9/30/2002 12/31/2002 3/31/2003 6/30/2003Various 65,472,370$ 65,472,370$ -$ -$ -$ -$ Asheboro, City of 0911 5,331,881$ -$ 5,331,881$ -$ -$ -$ Statesville, City of 0908 9,000,000$ -$ -$ 9,000,000$ -$ -$ Lincoln County 0958 981,076$ -$ -$ -$ 981,076$ -$ NW Craven W&S Dist 0622 1,602,284$ -$ 1,602,284$ -$ -$ -$ Cabarrus County W&S Dist 0950 1,442,619$ -$ -$ 1,442,619$ -$ -$ Oakboro, Town of 0915 2,636,334$ -$ -$ 2,636,334$ -$ -$ Lincoln County 0955 3,513,256$ -$ -$ -$ 3,513,256$ -$ Lincoln County 0957 1,130,874$ -$ -$ -$ 1,130,874$ -$ Oakboro, Town of 0672 781,687$ -$ -$ -$ 781,687$ -$ Brogden Water Dist 0808 1,734,000$ -$ -$ 1,734,000$ -$ -$ Rolesville/Raleigh 0931 3,000,000$ -$ -$ 3,000,000$ -$ -$

Total Projects * 96,626,381$ 65,472,370$ 6,934,165$ 17,812,953$ 6,406,893$ -$

Set Asides * 21,306,402$ 18,107,118$ 3,229,284$

(1) Binding Commitment Totals 117,932,783$ 83,579,488$ 10,163,449$ 17,812,953$ 6,406,893$ -$

(2) Cumulative Binding Commitments -$ Cumulative Through 6/30/2003 * 83,579,488$ 93,742,937$ 111,555,890$ 117,962,783$ 117,962,783$

Future(3) Cumulative Required Commitments ** Years

Payments to ACH1997 Capitalization Grant 46,114,100$ 46,114,100$ -$ -$ -$ -$ -$ 1998 Capitalization Grant 12,859,400$ 12,859,400$ -$ -$ -$ -$ -$ 1999 Capitalization Grant 13,477,900$ 4,845,000$ 8,632,900$ -$ -$ -$ -$ 2000 Capitalization Grant 14,007,400$ -$ 47,000$ 1,500,000$ 1,500,000$ 2,000,000$ 8,960,400$ 2001 Capitalization Grant 14,065,400$ -$ -$ -$ -$ -$ 14,065,400$

Total Federal Funds 100,524,200$ 63,818,500$ 8,679,900$ 1,500,000$ 1,500,000$ 2,000,000$ 23,025,800$

State Match 20,104,840$ 12,763,700$ 1,735,980$ 300,000$ 300,000$ 400,000$ 4,605,160$

Total 120,629,040$ 76,582,200$ 86,998,080$ 88,798,080$ 90,598,080$ 92,998,080$ 120,629,040$

(4) Binding Commitments as a Percent of Required Amount 109% 108% 126% 130% 127%

* All Grant Funds awarded have been committed as defined in the approved EPA Workplan and Intended Use Plans.

** Payments to ACH lagged by one year

Note: This Exhibit reflects the commitment of funds paid into the ACH. It does not include commitments made from loan repayments deposited into the Revolving Fund.

Exhibit 2 - Binding Commitments With Respect To Payment Schedule

---------------------------------------- Binding Commitments ---------------------------------



PriorYears 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total

Disbursements to Projects1997 Capitalization Grant 34,124,158$ 1,372,407$ -$ -$ 72,939$ 1,445,346$

State Match 8,680,972$ 349,133$ -$ -$ 18,555$ 367,688$ 1998 Capitalization Grant 5,725,368$ 1,341,450$ 676,667$ 191,540$ 314,052$ 2,523,709$

State Match 1,515,971$ 355,193$ 179,171$ 50,715$ 83,155$ 668,234$ 1999 Capitalization Grant 1,658,030$ 588,344$ 22,659$ 654,345$ 2,555,218$ 3,820,566$

State Match 428,395$ 152,015$ -$ 174,920$ 660,208$ 987,143$ 2000 Capitalization Grant -$ -$ -$ -$ 550,819$ 550,819$

State Match -$ -$ -$ -$ 143,171$ 143,171$ 2001 Capitalization Grant -$ -$ -$ -$ -$ -$

State Match -$ -$ -$ -$ -$ -$

Total 52,132,894$ 4,158,542$ 878,497$ 1,071,520$ 4,398,117$ 10,506,676$

Federal Share 41,507,556$ 3,302,201$ 699,326$ 845,885$ 3,493,028$ Cumulative 41,507,556$ 44,809,757$ 45,509,083$ 46,354,968$ 49,847,996$

State Share 10,625,338$ 856,341$ 179,171$ 225,635$ 905,089$ Cumulative 10,625,338$ 11,481,679$ 11,660,850$ 11,886,485$ 12,791,574$

Set Asides 1997 Capitalization Grant 6,025,370$ 285,153$ 137,842$ 99,067$ 95,482$ 617,544$ 1998 Capitalization Grant 1,904,454$ 13,787$ 190,408$ 105,609$ 137,812$ 447,616$ 1999 Capitalization Grant 1,116,933$ 258,978$ 139,668$ 335,697$ 150,352$ 884,695$ 2000 Capitalization Grant 142,565$ 122,810$ 181,410$ 166,798$ 203,865$ 674,883$ 2001 Capitalization Grant -$ -$ -$ -$ -$ -$

Total 9,189,322$ 680,728$ 649,328$ 707,171$ 587,511$ 2,624,738$

Total Disbursements 61,322,216$ 4,839,270$ 1,527,825$ 1,778,691$ 4,985,628$ 13,131,414$

Cumulative Totals 61,322,216$ 66,161,486$ 67,689,311$ 69,468,002$ 74,453,630$

ACH Funds Available (Beginning) -$ 26,802,216$ 31,930,315$ 32,139,324$ 32,100,230$

ACH Deposits 1997 Capitalization Grant 46,114,100$ -$ -$ -$ -$ -$ 1998 Capitalization Grant 12,859,400$ -$ -$ -$ -$ -$ 1999 Capitalization Grant 13,477,900$ -$ -$ -$ -$ -$ 2000 Capitalization Grant 5,047,000$ 8,960,400$ -$ -$ -$ 8,960,400$ 2001 Capitalization Grant -$ 50,000$ 1,500,000$ 1,500,000$ 2,000,000$ 5,050,000$

Total 77,498,400$ 9,010,400$ 1,500,000$ 1,500,000$ 2,000,000$ 14,010,400$

Cumulative ACH Deposits 77,498,400$ 86,508,800$ 88,008,800$ 89,508,800$ 91,508,800$

Cash Draw from ACH 50,696,184$ 3,882,301$ 1,290,991$ 1,539,094$ 4,224,902$ 10,937,288$

Cumulative Draw from ACH 50,696,184$ 54,578,485$ 55,869,476$ 57,408,570$ 61,633,472$

ACH Funds Available (Ending) 26,802,216$ 31,930,315$ 32,139,324$ 32,100,230$ 29,875,328$

-------------------------------------- Fiscal Year 2003 ------------------------------------------


Exhibit 3 - Total Disbursements


Prior CurrentYears Year Total

Beginning Balance -$ 5,494,229$

Increase in Available Funds

New Funds Deposited1997 Capitalization Grant Projects 34,124,158$ 1,445,346$ 35,569,504$

State Match 8,680,972$ 367,688$ 9,048,660$ 1998 Capitalization Grant Projects 5,725,368$ 2,523,709$ 8,249,077$

State Match 1,515,971$ 668,234$ 2,184,205$ 1999 Capitalization Grant Projects 1,658,030$ 3,820,566$ 5,478,596$

State Match 428,395$ 987,143$ 1,415,538$ 2000 Capitalization Grant Projects -$ 550,819$ 550,819$

State Match -$ 143,171$ 143,171$ 2001 Capitalization Grant Projects -$ -$ -$

State Match -$ -$ -$ Total New Funds 52,132,894$ 10,506,676$ 62,639,570$

Principal Repayments Received1997 Projects 2,485,586$ 2,508,897$ 4,994,483$ 1998 Projects (1) -$ 193,456$ 193,456$ 1999 Projects (1) -$ 47,502$ 47,502$ 2000 Projects -$ -$ -$ 2001 Projects -$ -$ -$

Total Principal Repayments 2,485,586$ 2,749,855$ 5,235,441$

Interest Payments Received (1) 1,289,080$ 1,795,525$ 3,084,605$

Interest Earned on Fund Balance 1,719,563$ 278,383$ 1,997,946$

Total Increase in Available Funds 57,627,123$ 15,330,439$ 72,957,562$

Decrease in Available FundsLoan Disbursements

1997 Capitalization Grant Projects 42,805,130$ 1,813,034$ 44,618,164$ 1998 Capitalization Grant Projects 7,241,339$ 3,191,943$ 10,433,282$ 1999 Capitalization Grant Projects 2,086,425$ 4,807,709$ 6,894,134$ 2000 Capitalization Grant Projects -$ 693,990$ 693,990$ 2001 Capitalization Grant Projects -$ -$ -$

Total Loan Disbursements 52,132,894$ 10,506,676$ 62,639,570$

Total Decrease in Available Funds 52,132,894$ 10,506,676$ 62,639,570$

Ending Balance 5,494,229$ 10,317,992$

(1) In addition to these amounts deposited into The Fund, an additional amount of loan interest ($17,544) andprincipal repayment ($63,497) is being held by the Office of State Controller in an escrow account. These fundswill be released for deposit into The Fund following the liquidation of bond indebtedness, from which thoseprojects derived their 20% match.

Note: "The Fund" consists of monies to be loaned out for projects, and does not include set aside funds.

Exhibit 4 - Status of The Fund



Prior Current TotalYears Fiscal Year Collections

Beginning Balance -$ 1,373,433$

Loan Administrative Fees - Projects Funded from1997 Capitalization Grant 897,444$ 2,466$ 899,910$ 1998 Capitalization Grant 229,369$ -$ 229,369$ 1999 Capitalization Grant 76,720$ 100,971$ 177,691$ 2000 Capitalization Grant 16,272$ 140,564$ 156,836$ 2001 Capitalization Grant -$ 127,330$ 127,330$ Drinking Water Revolving Fund -$ 120,119$ 120,119$

Total 1,219,805$ 491,450$ 1,711,255$

Interest Earned on Administrative Fees 153,628$ 63,895$ 217,523$

Ending Balance 1,373,433$ 1,928,778$


Exhibit 5 - Loan Administrative Fee


Project Binding Scheduled LoanNumber Assistance Commitment Construction Completion Interest Loan Term

Project Name (DEH-) Amount Date Start Date Date Rate (Years)

1997 Capitalization Grant None1998 Capitalization Grant None


Asheboro 0911 3,000,000$ 8/26/2002Statesville 0908 3,000,000$ 12/3/2002 4/8/2003 6/30/2004 2.66% 20Lincoln County 0958 346,566$ 3/18/2003Total 1999 6,346,566$


NW Craven 0622 1,602,284$ 9/4/2002 4/4/2003 4/30/2004 2.66% 20Asheboro 0911 2,331,881$ 8/26/2002Statesville 0908 3,000,000$ 12/3/2002 4/8/2003 6/30/2004 2.66% 20Cabarrus County W&S Dist 0950 1,442,619$ 11/22/2002Oakboro 0915 2,636,334$ 11/22/2002Lincoln County 0955 801,094$ 3/18/2003Lincoln County 0958 634,510$ 3/18/2003Lincoln County 0957 1,130,874$ 3/18/2003Total 2000 13,579,596$


Statesville 0908 3,000,000$ 12/3/2002 4/8/2003 6/30/2004 2.66% 20Oakboro 0672 781,687$ 1/21/2003 3/18/2003 2/28/2004 2.66% 20Brogden Water District 0808 1,734,000$ 11/22/2002Rolesville/Raleigh 0931 3,000,000$ 12/11/2002Lincoln County 0955 2,712,162$ 3/18/2003Total 2001 11,227,849$

DWSRF Revolving Fund

Statesville 0908 6,126,090$ 12/3/2002 4/8/2003 6/30/2004 2.66% 20

Total DWSRF Revolving Fund 6,126,090$

Total Binding Commitments 37,280,101$

Exhibit 6 - New Projects Identified for Receiving DWSRF Assistance



ProjectNumber

Project Name (DEH-) Source Treatment Storage Distribution Total

1997 Capitalization Grant None1998 Capitalization Grant None

1999 Capitalization GrantHillsborough 0801 1,802,952$ 1,802,952$ Statesville 0908 -$ 467,044$ -$ 2,532,956$ 3,000,000$

Total 1999 -$ 2,269,996$ -$ 2,532,956$ 4,802,952$

2000 Capitalization GrantNW Craven 0622 1,602,284 1,602,284$ Statesville 0908 467,044 2,532,956 3,000,000$

Total 2000 -$ 467,044$ -$ 4,135,240$ 4,602,284$

2001 Capitalization GrantStatesville 0908 467,044 2,532,956 3,000,000$ Oakboro 0672 518,626 263,061 781,687$

Total 2001 -$ 985,670$ 263,061$ 2,532,956$ 3,781,687$

DWSRF Revolving FundStatesville 0908 953,717$ 5,172,373$ 6,126,090$

Total DWSRF Revolving Fund -$ 953,717$ -$ 5,172,373$ 6,126,090$

Total -$ 4,676,427$ 263,061$ 14,373,525$ 19,313,013$

Note: Amounts reflect new assistance provided in current reporting year. Does not reflect adjustments to prior years assistance of $153,831 net reduction in total.


Exhibit 7 - Assistance Amount by Category

---------------------------- Category ---------------------------------


Current Assets:Cash and Cash Equivalents $ 12,502,052Receivables:

Loans (Due within one year) 3,656,791Accrued Interest 779,703Other 32,826

Total Current Assets 16,971,372

Capital Assets, Depreciable:Machinery and Equipment 130,339Accumulated Depreciation (36,703)

Total Capital Assets, Depreciable (net) 93,636

Noncurrent Assets: Loans Receivable (Due after one year) 53,683,840

Total Assets 70,748,848

Current Liabilities: Accounts Payable 33,132Accrued Vacation Leave 11,765Other Accrued Liabilities 469

Total Current Liabilities 45,366

Noncurrent Liabilities:Accrued Vacation Leave 118,522

Total Liabilities 163,888

NET ASSETS Restricted for:

Program Loans (Restated) 70,584,960

Total Net Assets $ 70,584,960

ASSETS

LIABILITIES

Exhibit 8-A

Statement of Net AssetsFor the Fiscal Year Ended June 30, 2003

North Carolina

June 30, 2003Annual Report

Drinking Water State Revolving Fund

REVENUESOperating Revenues:

Interest Income on Loans $ 1,649,987Loan Closing Fees 491,450

Total Operating Revenues 2,141,437

EXPENSESOperating Expenses: Personnel 1,184,783

Fringe Benefits 223,482Travel 14,677Supplies 13,457Software 951Postage and Printing 2,943Registration 3,198Telephone 196Repairs 2,038Depreciation 9,542Rent 182,407Capital outlay 70,761Other 41,443Contractual Services 782,987Indirect Cost 117,842

Total Operating Expenses 2,650,707

Operating Income (509,270)

NONOPERATING REVENUESFederal Grants 10,901,840Interest Income 351,151

Total Nonoperating Revenues 11,252,991

Income Before Transfers 10,743,721

Transfers In 1,798,548

Increase in Net Assets 12,542,269

NET ASSETSNet Assets after adjustments July 1, 2002 as Restated 58,042,691

Net Assets June 30, 2003 $ 70,584,960

North CarolinaDrinking Water State Revolving Fund


Exhibit 8-B

Statement of Revenues, Expenses, and Changes in Net Assets

For the Fiscal Year Ended June 30, 2003

State of North Carolina - files.nc.gov Resources/files/pws/srf... · The State of North Carolina...

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