Department of the Environment
Maryland Water Quality
Revolving Loan Fund
Financing Stormwater Infrastructure
Jag Khuman, Director
Maryland Water Quality Financing Administration
410-537-3119
December 7, 2015
Water Quality Revolving Loan Fund
Revenue
Bond
Proceeds
Debt Service
Payments to
Bond holders
Federal Funds &
20% State Match
Water Quality
Revolving Loan Fund
Below Market
Interest Rate
Loans
Loan Debt
Service
Repayments
Borrower
Investment
Earnings
MD Water Quality Revolving Loan Fund
Provides below market interest rate loans to finance Water
Quality capital infrastructure
Loans up to 100% of project cost. FY 2016 budget = $130
million (Funding capacity can be increased by issuing
revenue bonds)
Interest Rate (Dec 2015): Standard Rate = 1.50% fixed
Disadvantaged = 0.70% fixed
Term: Up to 30 years (based on useful life of the asset)
Loan Fee: 5% of P&I payment, collected annually with debt
service payments (adds ~0.50% to true interest rate on a
20-year term loan)
WQRLF - Potential Debt Service Savings
Annual DS payment ($M) on $100M, 20-year Financing
$8.00
$7.00
$7.36
17% Lower
23% Lower
$6.00
$6.12
$5.65
$5.00
$4.00
$3.00
$2.00
$1.00
$0.00
Market (4%)
Standard Rate (2%)
Disadvantaged Rate (1.2%)
Water Resources Reform and
Development Act of 2014 (WRRDA)
Key Stormwater WQSRF Eligibility Provisions:
• For measures to manage, reduce, treat, or
recapture stormwater or subsurface drainage
water.
• For reusing or recycling wastewater,
stormwater, or subsurface drainage water
Public Private Partnership (P3) Financing
P3 Public Entity
(e.g., MS4 Permitted Local
Government)
Debt Service
Payment in Advance
of Due Date
Trustee Bank
(3rd party/lock box)
P3 Master
Agreement
P3 - Private Entity
Debt Service
Payments
Loan Proceeds
Water Quality
Revolving Loan
Fund
Payment for work
completed
General
Contractor
WQRLF Debt Service Payment Guarantee
Repayment back to
WQRLF for amount
of Guarantee used, if
any
Water Quality
Revolving Loan Fund
P3 Public Entity
(e.g., MS4 Permitted Local
Government)
P3 Master
Agreement
Guarantee Payment
to Cure Debt Service
Payment Deficiency
Debt Service
Payments
P3 - Private Entity
Private/Capital
Market Financing
Loan Proceeds
Payment for work
completed
General
Contractor
Maryland Department of the Environment
Maryland Water Quality Financing Administration
1800 Washington Boulevard
Baltimore, MD 21230
410-537-3119
www.mde.maryland.gov/wqfa
1800 Washington Boulevard | Baltimore, MD 21230-1718
410-537-3000 | TTY Users: 1-800-735-2258
www.mde.state.md.us