| Summary |
The bill creates the septic-system replacement enterprise
(enterprise), which operates as a government-owned business imposing
and collecting a fee charged on septic-system permits and using the fee
revenue to provide loans to replace failing septic systems (loan program).
The enterprise is governed by a board that consists of 7 members
appointed by the governor as follows:
•
One member who is a county commissioner in a county
that has rural areas;
•
One member who is a member of a county board of health
in a county that has rural areas;
•
One member who is a member of a governing body of a
municipality that has septic systems;
•
One member who represents the department of public
health and environment (department);
•
One member who represents the department of local
affairs;
•
One member who represents an association of counties
within Colorado and who lives in a rural area; and
•
One member who is a rural homeowner with a septic
system.
Each member of the board serves at the pleasure of the governor.
The term of appointment is 4 years, with some members having staggered
terms. Members of the board serve without compensation but are entitled
to receive reimbursement for actual and necessary expenses incurred in
the performance of the members' duties on the board. The board will meet
as necessary.
The enterprise will impose a fee on septic-system permits and
administer the collection of the fee, and the enterprise may issue revenue
bonds, buy and sell property, enter into contracts, sue or be sued, hire
employees, set up an office, place liens on property, adopt rules, and take
any action necessary to implement the bill.
Starting January 15, 2027, and by January 15 each year through
2029, the enterprise will submit a written report to the governor, the joint
budget committee, the house of representatives transportation, housing,
and local government committee, and the senate local government and
housing committee. The report must include:
•
An accounting of the number of loans made under the loan
program, the total amount of the loans, the average amount
of a loan, and the number of septic systems replaced as a
result of the loan program;
•
An evaluation of the loan program; and
•
Any legislative recommendations for the loan program.
The enterprise will impose a septic-system enterprise fee on each
permit to install or replace a septic system. The fee is:
•
$10 if the fee for the septic-system permit is less than $500;
•
$50 if the fee for the septic-system permit is $500 or more
but less than $1,000;
•
$100 if the fee for the septic-system permit is $1,000 or
more but less than $1,400; and
•
$200 if the fee for the septic-system permit is $1,400 or
more.
The enterprise must consult with and coordinate with the water
quality control commission (commission) and local boards of health that
issue septic-system permits. The division of administration within the
department and the local government that issues the permit may retain up
to 5% of the fee to cover administrative costs. When the fee revenue is
projected to exceed the amount reasonably necessary to implement the
loan program and administer the bill, the enterprise shall adjust the
amount of the fee so that the revenue will equal the amount of money
needed to reasonably administer the loan program. The commission may
adopt rules to implement the division of administration's collection of the
fee.
The fee will be used by the enterprise to establish the loan
program, which makes interest-free or low-interest loans to low-income
or low-credit-score households to replace failing septic systems.
The enterprise will contract with at least 2 community
development financial institutions (financial institutions) to administer the
loan program. Standards are set for a financial institution to qualify to
administer the loan program. The financial institution must enter into a
contract with the enterprise. The bill sets contract standards, including
authorization for a financial institution to include an administration fee
in an amount reasonably calculated to cover the costs to implement the
contract.
A financial institution will use the money collected from the fee
to make loans to eligible homeowners in low-income or low-credit-score
households for the purpose of replacing septic systems. The financial
institution may establish reasonable standards and procedures to make
loans in compliance with the bill and the contract.
The enterprise or the department may seek, accept, and expend
gifts, grants, or donations from private or public sources to fund the bill.
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