(a) Amount of available funds. Annually, the executive administrator will determine the amount of funds available for water system improvements and other projects for the fiscal year.
(b) Principal forgiveness limits. The total amount of principal forgiveness in any fiscal year may not exceed the percentages established by federal law or by the capitalization grant.
(c) Project Priority List. Available program funds will be applied to the list of projects designated to receive funding. The methods used for ranking include:
  (1) Project costs. Project costs will be determined by cost estimates contained in the project information form if the executive administrator deems those costs reasonable and acceptable; the costs will also be reflected in the applicable IUP.
  (2) Tie-breakers. If two or more projects receive the same rating, then the executive administrator will use the tie-breaker procedures listed in the applicable IUP.
  (3) Bypass procedure. The executive administrator may bypass higher rated and ranked projects if:
    (A) an incomplete application is submitted as described in §371.31 of this title (relating to Timeliness of Application and Required Application Information); or
    (B) a bypass is necessary to fund certain types of projects as detailed in the applicable IUP or as required by capitalization grant conditions.
(d) Small water systems. Projects with identical combined rating scores, including rating scores of zero, will be listed in order of population. Projects serving smaller populations will be listed above those projects serving larger populations.
  (1) To the extent eligible Applicants are available, a minimum of 15 percent of the funds will be made available to small water systems.
  (2) If small community projects listed in priority order on the Invited Projects List are less than 15 percent, then the executive administrator may bypass projects for systems serving larger populations to ensure inclusion of small water systems projects for at least 15 percent of available funds.
(e) Projects submitted for financing will be screened for eligibility, scored, ranked, and listed on a Project Priority List. Applicants with projects on the Initial Invited Projects List will be invited to submit applications in accordance with the procedures and deadlines as detailed in the applicable IUP. The project selection is subject to subsections (a) - (d) of this section. The Project Priority List will be reviewed periodically and additional invitations will be extended until all of the annual DWSRF funding amount is committed.
(f) Utilization of remaining funds. If there are insufficient applications for financial assistance to obligate available funds for the funding year, then the executive administrator shall utilize the remaining funds during the next funding year or at any time in combination with other Board financial assistance programs.
(g) Fund shortages. When the amount of funds required to fund all complete applications for financial assistance exceeds the amount of funds available in the funding year, a shortage of funds exists. In such an instance, the Board will fund Applicants until all funds have been utilized. The Board shall fund projects prioritized by the date and time of receipt of a complete application and the project's ability to proceed to commitment.

Source Note: The provisions of this §371.23 adopted to be effective August 4, 2010, 35 TexReg 6680; amended to be effective July 30, 2012, 37 TexReg 5602; amended to be effective July 4, 2016, 41 TexReg 4844