The Border Environment Infrastructure Fund (BEIF), for project implementation, and the Project Development Assistance Program (PDAP), for project development, are grant programs funded by the U.S. Congress through the U.S. Environmental Protection Agency (EPA) and administered by NADBank.
This program offers grant financing exclusively for the implementation of high-priority municipal drinking water and wastewater infrastructure projects located within 100 kilometers of the U.S.-Mexico border.
The objective of the program is to make water infrastructure projects affordable by combining grant funds with loans and other forms of financing. It is designed to reduce project debt to a manageable level in cases where utility customers would face undue financial hardship and projects could not otherwise be implemented.
BEIF funds may be used to support projects that serve a single community or regional approaches that serve multiple communities and/or outlying areas.
Projects selected to receive a BEIF grant are also eligible to receive technical assistance through PDAP to support development activities aimed at facilitating their successful implementation and reinforcing their long-term sustainability and proper operation.
PDAP grants are available for planning studies, environmental assessments, final design, financial analyses and community participation efforts, among other activities
Information provided by the project sponsor will be evaluated to determine development needs and to prioritize projects for available PDAP funding.
NADBank loans can be combined with BEIF grants to complete project financing and may be provided in a number of ways, including in the form of a municipal bond.
Project Cost & Complementary Funding
The cost of any project shall not exceed US$30 million. Project sponsors are generally expected to finance part of the project with a debt component and must be able to confirm the commitment of other funding sources to complement the BEIF grant prior to certification.
The sponsor must complete all development activities, including obtaining environmental clearances and finalizing design, as well as obtain project certification and sign the grant agreement with NADBank, within two and a half years of receiving notification of project selection. Moreover, the project must be able to complete construction within three years following the signing of the BEIF grant agreement.
In order to protect the infrastructure associated with BEIF funding, project sponsors must have made or be willing to make adequate provisions for pretreatment of industrial/commercial sewage prior to construction financing. EPA also requires that appropriate cost-effectiveness and sustainable building principles be incorporated into all phases of project development: planning, design and construction.
Project sponsors are responsible for the procurement of all goods, works and services related to the project. However, procurement of goods and services with BEIF funds must be carried out in compliance with NADBank Procurement Policies and Procedures.
Only water and wastewater infrastructure projects located within 100 kilometers (62 miles) of the U.S.-Mexico border will be considered for funding.
Eligibility is based on a set of general project criteria:
The project sponsor must have the legal authority to develop the project, provide the proposed services and/or contract the proposed financing. A project must also observe or be capable of observing the environmental and other laws and regulations of the place where it is to be located or executed, including obtaining the necessary operating permits, licenses, and other regulatory requirements related to land acquisition and rights-of-way.
Location: Willcox, Arizona
NADBank Funding: 4.70M USD
Location: Hidalgo County, Texas
NADBank Funding: 1.9M USD
Projects must be certified by the NADBank Board of Directors to receive a BEIF grant. More detailed information about the technical, environmental and financial criteria for project certification is provided at the following link.
Project selection depends on the availability of funding. Because water and wastewater infrastructure needs in the border region exceed available grant funds, EPA uses a prioritization process to identify and select projects that address the most critical public health and environmental needs. This process allows the program to target limited funding to projects with the highest benefit in terms of public health and environmental risk, cost-effectiveness, institutional capacity and sustainability.
Each regional EPA office has developed a project prioritization methodology. Projects located in the border states of New Mexico, Texas, Chihuahua, Coahuila, Nuevo Leon and Tamaulipas fall under the jurisdiction of EPA Region 6. Projects located in the border states of Arizona, California, Baja California and Sonora fall under the jurisdiction of EPA Region 9.
Applications are received throughout the year and are evaluated periodically for placement within the ranked project application list. As additional BEIF funding becomes available, new projects will be selected and incorporated into the development pipeline.
All BEIF funding proposals are prepared by NADBank on a case-by-case basis and are subject to final approval by EPA.
Upon completion of the final design, NADBank conducts a comprehensive financial analysis of the project, utility and community that takes into consideration eligible projects costs and the availability of other funding. As part of the analysis, NADBank determines the sponsor’s maximum debt capacity, as well as the amount of BEIF grant necessary to make a project affordable. However, the BEIF grant may not exceed US$8 million.
For Mexican projects, NADBank works closely with the Mexican national water agency, Comisión Nacional de Agua (CONAGUA) and ensures that every grant dollar of BEIF awarded to projects in Mexico is matched with funding from Mexican sources.
Once a project has been selected to receive a BEIF grant, it enters the certification and financing process. To facilitate this process and minimize possible delays in project financing and implementation, NADBank provides the following basic steps for project sponsors.
The project sponsor should keep NADBank informed regarding the status of the project and provide any requested financial and technical information as soon as it becomes available. NADBank will use the information provided by the project sponsor to prepare the corresponding certification and financing proposals.
All project development activities, including finalizing design, obtaining any necessary environmental clearance and conducting public outreach efforts to disseminate information about the project to the local community must be completed in order to proceed with project certification. Moreover, the funding from all other sources must be committed prior to certification.
With the support of the project sponsor, NADBank will prepare the financing proposal for submission to the corresponding EPA regional office for approval, as well as the project certification proposal for submission to its Board of Directors. The certification proposal will be submitted to a 30-day public comment period, prior to submission to the Board.
Upon approval, NADBank and the project sponsor will sign a financing agreement defining the terms and conditions of the grant. The financing agreement must be signed within two and a half years of receiving notification of project selection.
The project must be able to complete construction within three years following the signing of the grant agreement. The procurement of goods, works and services related to the project is the responsibility of the project sponsor; however, NADBank will monitor procurement to ensure the process is fair and transparent, as well as project construction and compliance with grant covenants.
Upon project completion and in compliance with the grant agreement, the project sponsor will provide required reports to NADBank in a timely manner. NADBank will perform a closeout process for the project 1 year after project startup with support from the project sponsor.
BEIF/PDAP PRIORITIZATION PROCESS FOR DRINKING WATER AND WASTEWATER INFRASTRUCTURE PROJECTS
The EPA Border Water Infrastructure Program supports both the Project Development Assistance Program (PDAP) and the Border Environment Infrastructure Fund (BEIF), administered by NADBank.
The information provided in this project application will be evaluated for the purpose of prioritizing projects for available PDAP funding resources to support project planning and design. Once a project has completed planning and final design, it may be considered for BEIF construction funding based upon available resources. The determination of the BEIF amount for any project shall be based on the NADBank affordability analysis, which reviews the project sponsor’s capacity, supported by revenue sources such as user rates, to financially contribute to the project through loan or equity.
The project shall complete project development activities including planning, environmental clearance, final design, including a proposed financial structure for the project, within two (2) years of receiving notification of project selection. The project must also be able to complete construction within a three-year period after signing a NADBank sub-grant agreement for construction funding. In addition, the construction cost of any project shall not exceed US$30 million and the BEIF grant cannot exceed US$8 million.
A project application shall be completed for each independent project, defined as a mutually exclusive construction activity that can be funded, constructed, and fully function independent of another project. The project must be intended to serve an existing population and shall not be developed to provide service to future populations or to induce growth. Multiple project applications may be submitted by a project sponsor. Although not an exhaustive list, the following documents may be helpful to have access to in order to complete the application:
After the initial project application evaluation, ranking and selection process, the application cycle is expected to remain open with evaluations occurring on a periodic basis and the ranked project list will be updated. Project selection will depend on the availability of funding.
PROJECTS LOCATED IN NEW MEXICO, TEXAS, CHIHUAHUA, NUEVO LEON, COAHUILA or TAMAULIPAS
PROJECTS LOCATED IN ARIZONA, CALIFORNIA, BAJA CALIFORNIA AND SONORA