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Environmental Loans (EL) Private Lead Service Line (LSL) Replacement Funding Program

The Wisconsin DNR established a two-year program (SFY 2017 and SFY 2018) to assist disadvantaged municipalities replace lead service lines on private property for projects that result in full lead service line (LSL) replacements. Funding for LSL replacement on private property is in the form of Principal Forgiveness (PF), which means no debt is incurred on behalf of the municipality for these funds.

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Private Lead Service Line (LSL) Program background

LSL program description

The SDWLP Intended Use Plans (IUPs) provide a description of the Private LSL Replacement Funding Program. Funding for this program is only available for SFY 2017 and SFY 2018, and projects must result in full lead service line replacements. Municipalities have three years from the date of their loan closing to expend funds for the LSL program.

The program is intended to assist individuals in disadvantaged municipalities since user rates cannot be used to replace the private portion of the lead service line. The program policies are established with participation from the Wisconsin Departments of Natural Resources (DNR) and Administration (DOA) and the Wisconsin Public Service Commission (PSC) to ensure each respective agency's requirements are met.

SFY 2017 projects

The 38 municipalities that submitted applications for SFY 2017 funding must close their principal forgiveness "loans" by June 28, 2017.

The SFY 2017 awards are allocated based on municipal population once the municipality meets the program criteria, including eligibility and deadlines, as follows:

  • $1,000,000 for municipalities with population 500,000
  • $500,000 for municipalities with population < 500,000 and 50,000
  • $300,000 for municipalities with population < 50,000

SFY 2018 projects

The 41 municipalities eligible to submit an application for SFY 2018 funding are listed in the Project Priority List (PPL) and must submit a complete application by June 30, 2017 to receive private LSL replacement funding from this program. Municipalities will need to document the number and location of the private LSL replacements for which they are requesting funding in their SFY 2018 application. Specific application requirements for SFY 2018 LSL project applications will be defined in the near future. Please check back for updates.

Funding caps will be established in the SFY 2018 SDWLP Intended Use Plan (IUP), anticipated to be published in April, 2017. A Funding List will be published after the applications are reviewed for eligibility and completeness.

Concerns about lead and partial lead service line replacements

New national research on lead in drinking water has raised concerns within DNR regarding the potential for increased lead levels when partial LSL replacement occurs. The Department is advising that municipalities replace lead service lines in their entirety – partially replacing lead service lines can increase lead levels in homes. Visit the Wisconsin DNR Drinking & Groundwater Program's Drinking Water & Lead Web page for more information on lead in drinking water.

Infographic of meter, service line, curb stop, service line, and water main. The private property owner is responsible for the service line from the curb stop to the home (this includes all plumbing except for the water meter inside the property). The municipality is responsible for the service line from the water main to the curb stop. The private property owner is responsible for the service line from the curb stop to the home (this includes all plumbing except for the water meter inside the property). The municipality is responsible for the service line from the water main to the curb stop.


Lead pipe waste management

What to do with the lead pipes after they are removed from service:

The Department recommends lead pipe materials removed from water services be managed through reclamation rather than disposal. A provision in ch. NR 661.02(3)(c), Wis. Admin. Code allows for management of what would otherwise be waste scrap metal to be managed as a solid waste provided the scrap metal is reclaimed.

Municipalities are encouraged to carefully evaluate scrap dealers who might take this waste to ensure the lead pipe materials will be properly recycled. Recycled lead can be put back into use through lead-acid batteries, lead shielding, and other valuable uses.

If a municipality chooses to dispose of the lead materials, it will be necessary to characterize the waste to determine if it exhibits a hazardous characteristic for lead. Lead pipe materials would likely fail TCLP for lead and would then need to be managed as a hazardous waste. Lead pipe materials determined to be nonhazardous could be disposed of in a solid waste landfill.

Waste determinations

For more information on waste determinations, please contact Ed Lynch, Section chief of Hazardous Waste Prevention and Management, or contact your DNR Regional hazardous waste management specialist.

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Implementation tools for municipalities in the LSL program

Read the list of Considerations for Setting up a Private Lead Service Line (LSL) Replacement Program [PDF]. This list of considerations is meant as guidance for municipalities that are deciding how to establish their own private LSL replacement program.

Municipal program & contracting options

Municipalities have options for how they establish a private LSL replacement program, with the understanding that the LSL PF can only be used for the cost of replacing private LSLs which result in the full replacement of the lead service line for that property.

Private LSL replacements can be done:

  • to make prior partial service line replacements "full";
  • as planned road and public watermain replacements occur;
  • at licensed daycare centers and pre-K-12 schools.

Private LSL replacement can be accomplished through a municipal contract or through a municipal program where the homeowners contract directly with a plumber/contractor from a prequalified list. View the Type of Contracting [PDF] table for contracting options and the associated requirements.

Note: The Department of Safety and Professional Services (DSPS) licenses plumbers and enforces the state plumbing codes.

Municipal program with prequalified list of plumbers

Under this option the municipality issues a Request for Qualifications (RFQ) in order to prequalify plumbers/contractors for participation in the private LSL replacement program (see Prequalification Considerations [PDF]). Homeowners contract directly with a plumber from the prequalified list and then are either reimbursed by the municipality or the municipality can pay the plumber directly on the homeowner's behalf.

Federal Davis-Bacon wage rates may not be required when the homeowner contracts directly with the prequalified plumber, even if the municipality pays the plumber directly. Applicability depends on property ownership or the type of firm performing the work. For further guidance, please see Davis-Bacon Applicability in the Private LSL Replacement Program [PDF].

Municipal Programs are the most requested option so far under the private LSL replacement program. Municipalities are developing their own criteria for the programs, including:

  • Funds distribution based on the age of the children in the home;
  • Funds distribution based on household income;
  • Fully-funded private LSL replacement;
  • Cost-shared private LSL replacement;
  • Funds made available through a revolving loan program;
  • Voluntary homeowner participation; and
  • Mandatory homeowner participation.

Municipal contract

Under this option the municipality bids out the private LSL replacement work through their normal municipal contracting process. All costs are paid directly by the municipality who coordinates the timing of the private LSL replacement with the homeowner.

Federal Davis-Bacon wage rates are required when the municipality directly contracts for the work. For further guidance, please see Complying with Davis-Bacon and Related Acts (DBRA) [PDF].

Cost eligibility & project eligibility

The private LSL replacement program can be used for costs associated with private homes, K-12 schools, and licensed day care centers. It does not cover costs for replacing private lead service lines to commercial and business properties, except in instances where a building contains both a business and a residence. All associated costs for private LSL replacement are eligible for funding, including: investigative costs, engineering costs (prorated if part of a larger project), easements, force account, etc.

The public portion of the service line is eligible for regular SDWLP program funding (loans and, if applicable, regular principal forgiveness). Funds cannot be used to replace interior plumbing and/or fixtures containing lead (for funding option, see CDBG Housing Program).

In addition to lead service lines, the private LSL replacement program can fund the cost of removing lead goosenecks and galvanized service lines that have been served by lead lines/pipes in the past. A "gooseneck" is a short segment of pipe (under the street) that connects the water main to the service line. These all can contribute to elevated lead levels in the water.

Plans and specifications

For most situations, the submittal of plans and specifications to the DNR for private service line replacements is not required.

The Department of Safety and Professional Services (DSPS) has indicated that private residential lines are not reviewable projects under their regulations; however, any private LSL replacements would be required to meet applicable local, state (DSPS), or federal codes. The DSPS licenses plumbers and enforces the state plumbing codes.

Authorized representative resolution

An authorized representative resolution [PDF] is required so the Department knows the applicant has the authority from the municipality to seek funding for this program. This resolution should accompany the application submittal.

Note: a reimbursement resolution is not required for a PF-only application.

Federal requirements

Private Lead Service Line (LSL) Replacement projects are federally funded; therefore, federal requirements apply:

Municipalities anticipating submitting a SFY 2018 application for funding are encouraged to initiate the Environmental Review process as soon as possible, to help expedite the awarding of funds to their project.

Forms

The following forms are part of the private LSL replacement program:

Note: June 30, 2017 was the application deadline for SFY 2018 LSL projects.

Closing

Closing Your LSL Loan [PDF] is guidance for municipalities that submitted applications for SFY 2017 funding and must close their LSL projects by June 28, 2017.

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Additional resources on lead service lines

Sample municipal documents

The following documents were distributed to municipalities participating in July 2016 informational meetings:

Toolkit from the Lead Service Line Replacement (LSLR) Collaborative

The LSLR Collaborative released a new toolkit for utilities, public health officials, and local leaders to tackle lead pipes in their community. The online toolkit [exit DNR] includes a roadmap for getting started; suggested practices to identify and remove lead service lines in a safe, equitable, and cost-effective manner; policies that federal and state leaders could adopt to support local efforts; and links to additional resources that may be helpful when developing local programs.

Strategies to obtain customer approval

The document, Strategies to Obtain Customer Acceptance of Complete Lead Service Line Replacement [PDF exit DNR], presents an approach to obtain customer approval for replacement of the lead service line on their property. It focuses on key elements of proven utility programs for readers to consider when developing their own local cost-efficient program. This document summarizes the regulatory requirements of the Lead and Copper Rule as it pertains to lead service line replacement. (Produced by the American Water Works Association (AWWA).)

Community Development Block Grant (CDBG) Housing Program

The Department of Administration (DOA) CDBG Housing Program will work with qualifying homeowners to assess hazards in their homes, including lead service lines. The 0% interest loan would cover the costs for addressing all hazards, not just lead lines. Repayment on the loan is deferred until the home is sold or no longer the homeowner's primary residence. Visit DOA's CDBG Housing Program [exit DNR] webpage for more information.

Environmental Defense Fund (EDF)

The Environmental Defense Fund (EDF) is recognizing community efforts to replace LSLs [exit DNR]. Communities aim to replace at least 240,605* lead pipes in their water systems. *Estimate of the total LSLs for which communities have set a goal to replace. This number is likely an underestimate, as most communities do not know where all of the LSLs are located.

Archived resources & materials

E-Bulletin articles

Read about the LSL program in E-Bulletin newsletters.

Webinar: LSL funding basics

The Wisconsin DNR hosted and recorded a public webinar on 6/8/2016 about SDWLP LSL funding basics [VIDEO Length 44:25]. It includes a 15-minute presentation followed by 30 minutes of a panel answering questions. View LSL slide show handout [PDF].

Frequently asked questions (FAQ)

The Private LSL Replacement Program Frequently Asked Questions (FAQ) [PDF] addresses many issues relating to the Private Lead Service Line Replacement Funding Program and projects.

Prequalification Considerations [PDF] addresses questions about the prequalified list of plumbers and the municipal Request for Qualifications (RFQ) from licensed plumbers/utility contractors interested in participating in the private LSL replacement program.

July 2016 informational meetings

Read the Summary of private Lead Service Line (LSL) municipality meetings [PDF] held during July of 2016. DNR presented, with participation from PSC, information about the private LSL replacement funding program to municipalities. The following documents were distributed to participating municipalities:

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Contact information
Direct questions about the private Lead Service Line (LSL) replacement funding program to:
Becky Scott
Financial assistance specialist, EL section
Bureau of CFA
608-267-7584
or
Robin Schmidt
Section chief, EL section
Bureau of CFA
608-266-3915
Direct questions about the Safe Drinking Water Loan Program (SDWLP) to:
Nicole Mathews
Safe Drinking Water Loan Program (SDWLP) specialist
EL section, Bureau of CFA
608-266-0849

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Last revised: Wednesday August 09 2017