CHAPTER 74:05:12
BROWNFIELDS REVITALIZATION AND ECONOMIC DEVELOPMENT PROGRAM
Section
74:05:12:01 Definitions.
74:05:12:02 Development of an annual work plan.
74:05:12:03 Content of the annual work plan.
74:05:12:04 Amendment of the annual work plan of projects.
74:05:12:05 Eligibility for a brownfields revolving loan subfund grant or loan.
74:05:12:06 Eligible uses of brownfields revolving loan subfund funds.
74:05:12:07 Application requirements.
74:05:12:08 Application deadline.
74:05:12:09 Review of financial status.
74:05:12:10 Factors for decision making.
74:05:12:11 Decisions on applications.
74:05:12:12 Assistance agreements.
74:05:12:13 Financial security.
74:05:12:14 Size and type of awards.
74:05:12:15 Match requirements for brownfields revolving loan subfund assistance.
74:05:12:16 Time restrictions.
74:05:12:17 Duration of assistance.
74:05:12:18 Assistance agreement interest rates.
74:05:12:19 Funds disbursement.
74:05:12:20 Accounting methods and audits.
74:05:12:21 Settlement agreements.
74:05:12:01. Definitions. Terms not defined in this section have the meaning given by the Small Business Liability Relief and Brownfields Revitalization Act (Pub. L. No. 107-118) as amended through January 1, 2004. The following terms mean:
(1) "Act," Small Business Liability Relief and Brownfields Revitalization Act (Pub. L. No. 107-118) as amended on January 1, 2004;
(2) "Applicant," the eligible entity applying for brownfields revolving loan subfund funds to complete a project eligible under the Act;
(3) "Assistance," financial assistance awarded by the Board of Water and Natural Resources pursuant to SDCL 46A-1-102;
(4) "Award," grant or loan funds awarded by the Board of Water and Natural Resources for a brownfields project pursuant to SDCL 46A-1-100 to 46A-1-104, inclusive;
(5) "Board," the Board of Water and Natural Resources;
(6) "Borrower," an eligible public or private entity that uses brownfields revolving loan subfund funds for cleanup and cleanup related activities at an eligible site, and agrees to and complies with the terms of a loan or grant agreement between the board and the applicant;
(7) "Brownfields assessment and cleanup subfund," a subfund established to provide the department with funds to perform the assessment and cleanup of eligible brownfields sites as defined under the Act;
(8) "Brownfields revolving loan subfund," a subfund established to provide grants and loans to fund cleanup of eligible brownfields sites as defined under the Act;
(9) "Community involvement plan," a plan that is developed by the applicant to allow public participation in the selection of cleanup options for a brownfields site;
(10) "Contaminant, pollutant, hazardous substance, or hazardous material," as those terms are defined by the federal Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the federal Superfund Amendments and Reauthorization Act of 1986;
(11) "Department," the South Dakota Department of Agriculture and Natural Resources;
(12) "Eligible site," a brownfields site as defined under the Act;
(13) "Project," the actual cleanup, treatment, containment, removal or disposal of hazardous substances, contaminants, regulated substances as defined by SDCL 34A-12-1(8), or pollutants as allowed under the Act. In addition, a project may include actions at mine-scarred lands, qualifying petroleum sites, and qualifying sites impacted by controlled substances;
(14) "Remediation plan," proposed actions to remediate a release of hazardous substances, contaminants, pollutants, petroleum, controlled substances, or mine-scarred lands as allowed under the Act;
(15) "Regulated substance," as the term is defined in SDCL 34A-12-1(8); and
(16) "Secretary," the secretary of the Department of Agriculture and Natural Resources or a designated representative of the secretary.
Source: 31 SDR 94, effective January 5, 2005; SL 2021, ch 1, §§ 8, 19, effective April 19, 2021.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:02. Development of an annual work plan. The department shall develop an annual work plan for the state brownfields revitalization and economic development program within 30 days of January 5, 2005, and by January 1 of each year thereafter. Upon completion of the annual work plan by the department, the board shall conduct a public hearing to receive comments from the public. The board shall provide at least 30 calendar days notice of the public hearing in at least three newspapers of general circulation in different parts of the state. The board shall accept written comments during this period. After the comment period is over, the board shall compile and adopt the annual work plan at the hearing.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:03. Content of the annual work plan. The work plan required in § 74:05:12:02 shall include a list of projects eligible to apply for financial assistance from the brownfields revolving loan subfund. The work plan shall establish site selection criteria and funding levels for the department to expend funds from the brownfields assessment and cleanup subfund to perform the assessment and cleanup of brownfields sites.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:04. Amendment of the annual work plan of projects. The board may amend the work plan required in § 74:05:12:02 at any board meeting if the proposed action is included on the agenda posted for the meeting.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:05. Eligibility for a brownfields revolving loan subfund grant or loan. An applicant is eligible to apply for loan or grant funding from the brownfields revolving loan subfund if:
(1) The applicant is eligible for funding under the Act;
(2) The project is eligible for funding under the Act;
(3) The project is on the annual board-approved work plan;
(4) The applicant has developed a community involvement plan as required under the Act;
(5) The applicant has developed a department-approved remediation plan; and
(6) The project has a resolution of support from the city or county where the project is located.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:06. Eligible uses of brownfields revolving loan subfund funds. Eligible brownfields revolving loan subfund activities include cleanup actions associated with removing, mitigating, or preventing the release or threat of release of hazardous substances, regulated substances, contaminants, or pollutants as allowed under the Act. In addition, these activities may include actions at mine-scarred lands, qualifying petroleum sites, and qualifying sites impacted by controlled substances including:
(1) Fences, warning signs, or other security or site control precautions;
(2) Drainage controls;
(3) Stabilization of berms, dikes, or impoundments or drainage or closing lagoons;
(4) Capping of contaminated soils;
(5) Use of chemicals and other materials to retard the spread of the release of a hazardous substance, petroleum, pollutant, or contaminant or mitigate its effects;
(6) Excavation, consolidation, or removal of contaminated soils from drainages or other areas;
(7) Removal of drums, barrels, tanks, or other bulk containers that contain or may contain hazardous substances, pollutants, or contaminants;
(8) Containment, treatment, disposal, or incineration of hazardous materials;
(9) Provisions of alternative water supply where necessary to reduce exposure to contaminated household water;
(10) Site monitoring activities, including sampling and analysis, that are necessary during the cleanup process, including determination of effectiveness of a cleanup;
(11) Costs associated with meeting public participation, worker health and safety, and interagency coordination requirements;
(12) Removal activities, including demolition or site preparation or both, that are part of site cleanup;
(13) Purchase of environmental insurance; or
(14) Other activities as approved by the Act.
Brownfields revolving loan subfund funds may not be used for precleanup environmental response activities, such as site assessment, identification, or characterization.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:07. Application requirements. An eligible applicant shall submit a brownfields revolving loan subfund assistance application for an eligible site to the board on forms obtained from the department. The applicant may arrange with the department for a preapplication conference to provide for orderly application preparation. An application may not be considered by the board until the secretary has determined that the application is complete. A complete application must include the following items, as applicable to the proposal:
(1) Application cover sheet;
(2) Budget sheet;
(3) Proposed method of financing;
(4) Project narrative;
(5) Cooperative agreements with units of local government;
(6) Letters of financial commitment from other federal, state, or local agencies or private resources;
(7) Status reports for all open and existing brownfields grants and loans;
(8) Local government resolutions;
(9) A financial statement, if requested by the department;
(10) Business plan;
(11) A department approved project remediation plan; and
(12) A community involvement plan.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:08. Application deadline. An eligible applicant shall submit a brownfields revolving loan subfund assistance application to the board on forms obtained from the department. Applications are due on the 15th day of January, April, July, and October. Applications must be postmarked or delivered no later than the day on which applications are due. The department shall present applications to the board after the completion of all required technical reviews and financial analyses. The department shall notify the applicant of the board meeting at which the application will be considered by the board.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:09. Review of financial status. The secretary shall prepare a summary of the applicant's financial status and provide a copy to the board with the assistance application. This summary shall include an analysis of all assets and liabilities and an analysis of the applicant's financial capability.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:10. Factors for decision making. In exercising its discretion in determining whether to award funding for a project, the board may consider factors described in this section. Applicants shall compete against other applicants requesting funds. The decision-making factors include those listed below:
(1) Extent that the project facilitates creation, preservation, or addition to a park or greenspace;
(2) Extent that the project meets the needs of the community;
(3) Extent that the application has the ability to draw on other resources for cleanup funds;
(4) Extent that funding will facilitate reuse of existing infrastructure;
(5) The amount of funds available for distribution;
(6) Compliance with permits and regulations;
(7) Debt service capability;
(8) Readiness to proceed; and
(9) Technical feasibility.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:11. Decisions on applications. Within 120 days after an application is presented to the board by the secretary, the board shall by resolution either disapprove the application or approve the application as requested or as modified by the board. Modification may include awarding a loan in lieu of a grant or a grant in lieu of a loan, or a combination of each.
The department shall notify each applicant in writing of the board's decision on the application.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:12. Assistance agreements. If a brownfields revolving loan subfund assistance application is approved for funding, the board shall execute an assistance agreement with the recipient. The board shall establish the terms and conditions in the assistance agreement. Assistance agreements for loans and grants may include the following requirements of the recipient:
(1) To acquire all property rights necessary for the project including rights-of-way and interest in land needed for the construction, operation, and maintenance of the project; to furnish title insurance, a title opinion, or other documents showing the ownership of the land, mortgages, encumbrances, or other lien defects; and to obtain and record the releases, consents, or subordinations to the property rights for holders of outstanding liens or other instruments as necessary for the construction, operation, and maintenance of the project;
(2) To provide security for loans as required in § 74:05:12:13;
(3) To provide for the receipt of revenues sufficient to meet the requirements of debt service, operation, and maintenance and to establish reserves in an amount sufficient to ensure that expenses and payments are paid on time for loan installments, emergency maintenance, and replacement of assets that have a useful life less than the repayment period of the loan;
(4) To acquire and maintain insurance coverage, including fidelity bonds;
(5) To establish and maintain books and records relating to the construction and operation of the project and its financial affairs;
(6) To provide the secretary access to all books and records relating to the project and access to the property of the system so that the secretary may ascertain whether the recipient is complying with the provisions of this chapter and with the funding agreement;
(7) To use funds that remain available after all costs of the project have been paid for needed extensions, enlargements, and improvements of the project with the written permission of the board;
(8) Not to sell, transfer, lease, or otherwise encumber the project, any portion of the project, or interest in the project to a public or private entity without the prior written consent of the board while the funding agreement is in effect;
(9) If the undertaking would obligate the source of funds pledged to repay the assistance agreement, to agree not to borrow money from any source, enter into any agreement, or incur other liabilities in connection with the project, exclusive of normal maintenance, without the prior written consent of the board;
(10) To agree that upon default in the payments of principal and accrued interest on the loan or in the performance of any covenant or condition, the board may, at its option, do one or more of the following:
(a) Declare immediately due and payable the entire principal amount then outstanding and the accrued interest and all costs associated with collection of the outstanding balance;
(b) For the account of the borrower incur and pay reasonable expenses for repair, maintenance, and operation of the project and other expenses necessary to cure the cause of default;
(c) Take possession of the project, repair, maintain, operate, sell, lease, or otherwise dispose of the project to another entity; and
(11) To secure written approval from the secretary for any changes or modifications in the plans of a project before or during construction according to conditions and specifications set forth in the funding agreement.
The board may amend assistance agreements as it considers necessary and circumstances warrant.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:13. Financial security. Specific requirements to secure a loan must be included in the brownfields revolving loan subfund assistance agreement. The loan must be secured by one or more of the following:
(1) Full faith and credit of the recipient;
(2) Pledges of taxes or assessments;
(3) Pledges of project revenue;
(4) Liens on the interest of the applicant in all real and personal property, easements, rights-of-way, and similar property rights, including leasehold interests, used in connection with the project or the proceeds therefrom, whether owned at the time the loan is approved, acquired with loan funds, or acquired thereafter; or
(5) A security interest in the recipient's goods, machinery, inventory, equipment, and other personal property, including fixtures now owned or acquired later, together with all accessions and all substitutions and replacement; documents of title now existing or arising later; instruments, documents, chattel paper, or general intangibles, including chooses in action, tax refunds, and insurance proceedings; rights to receive any payments in money or kind, or any other obligations or indebtedness owed to the recipient from any source, including guarantees of these rights; and all proceeds and products of all of the items listed in this subdivision.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:14. Size and type of awards. The board may award an amount different than that requested in the brownfields revolving loan subfund application. The board may award grants, loans, or a combination of grants and loans. Grant awards may not exceed 40 percent of the total award. In determining the amount of financial assistance, the board shall consider the following:
(1) The availability of brownfields revolving loan subfund funds;
(2) The applicant's need;
(3) Public support for the project;
(4) Violation of health or environmental standards or a significant safety risk and how the project will minimize or correct the violations; and
(5) The applicant's ability to repay a loan.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:15. Match requirements for brownfields revolving loan subfund assistance. The recipient must provide a minimum of 20 percent match on the amount of the brownfields revolving loan subfund financial assistance. This match may be in the form of:
(1) Cash;
(2) Labor;
(3) Materials; or
(4) Other services as allowed by the Act.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:16. Time restrictions. The recipient shall expend the brownfields revolving loan subfund funds awarded to it within three years from the date the board approved the application for funding.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:17. Duration of assistance. The board shall set the repayment period for each brownfields revolving loan subfund loan in the assistance agreement, which may not exceed ten years.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:18. Assistance agreement interest rates. The board shall set the interest rate for the brownfields revolving loan subfund loans, based upon:
(1) Current market rates; and
(2) Current demand for program funds.
Based on the above criteria, the board may also adjust the interest rate at any board meeting if the proposed action is included on the agenda posted for the meeting.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
Cross-Reference: Notice of meetings of public bodies, SDCL 1-25-1.1.
74:05:12:19. Funds disbursement. The department shall disburse funds as costs are incurred. Payment may not exceed the percentage provided in the award agreement.
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:20. Accounting methods and audits. Each recipient must maintain accounting records in accordance with financial and reporting standards as promulgated by the Government Accounting Standards Board or Other Comprehensive Basis of Accounting as in effect November 5, 2004. Each recipient must agree to have audits performed in accordance with SDCL chapter 4-11, and if applicable, Federal Office of Management Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations, dated June 30, 1997, as provided in the Single Audit Act of 1984, Pub. L. No. 98-502, and the Single Audit Act of 1996, Pub. L. No. 104-156. Each loan recipient shall retain all accounting records, books, and supporting material for a period of three years after completion of the project. Each grant recipient shall retain all accounting records, books, and supporting material for a period of three years after the end of the assistance agreement. These accounting records must be made available for inspection by state and federal representatives upon request..
Source: 31 SDR 94, effective January 5, 2005.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
74:05:12:21. Settlement agreements. The department may enter into administrative settlement agreements with brownfields applicants and recipients to provide certain environmental liability assurances for brownfields projects as provided for in SDCL 34A-10-17. The settlement agreement is only binding if the applicant or recipient completes the remediation of the project.
If a person is conducting or has completed a response action regarding a specific release that is addressed by the response action at a brownfields site and the response action is in compliance with the State program that specifically governs the response action for the protection of public health and the environment, and there is a release or threatened release of a hazardous substance, pollutant, or contaminant addressed by the response action, the State may not take an administrative or judicial enforcement action or take an action to recover response costs against the person who is conducting or who has completed the response action or against the person's successor's in title, against the person's tenants, or against those persons who engage in operations on the property or their lender-owners regarding the specific release that is addressed by the response action unless the release or threatened release present an imminent and substantial endangerment to public health or the environment.
The State, by and through the Department of Agriculture and Natural Resources may issue a covenant not to sue on brownfields sites and contiguous real property impacted by such sites where a person is conducting or has completed a response action with certain conditions which may be revoked if the conditions are not met after notice to the parties to the covenant and an opportunity to cure. The covenant not to sue may contain a provision releasing the person who undertook the remediation and the person's successors in title and all persons who lease the property or who engage in operations on the property and their lender-owners from all civil liability to the State to perform any additional remediation, to pay compensation for damage to, or loss of, natural resources, or for any cleanup and removal costs, if certain conditions are met. Unless a covenant not to sue is revoked, liability for any additional remediation may not be applied retroactively to any person for whom the covenant remained in effect during that person's ownership, tenancy, or operation of the property. A covenant not to sue and the protections it affords does not apply to any discharge or release that occurs subsequent to the State's issuance of a no further action letter which was the basis of the covenant, or to a separate discharge, release, or threatened release. A covenant not to sue and the protections it affords does not relieve any person of the obligation to comply in the future with laws and regulations. A covenant not to sue does not provide relief from any liability, either under statutory or common law, unless otherwise specifically provided in the covenant.
Source: 31 SDR 94, effective January 5, 2005; SL 2021, ch 1, §§ 8, 19, effective April 19, 2021.
General Authority: SDCL 46A-1-102, 46A-1-103.
Law Implemented: SDCL 46A-1-100 to 46A-1-106, inclusive.
