MS HB1349

Transfers administration of the Local Governments and Rural Water Systems Improvements loan program from the State Department of Health to the Mississippi Commission on Environmental Quality acting through the Department of Environmental Quality.

Establishes two special funds: the "Local Governments and Rural Water Systems Improvements Revolving Loan Fund" and the "Local Governments and Rural Water Systems Emergency Loan Fund" to provide loans and grants for water system improvements including construction, expansion, and repair of public water systems.

Authorizes loans up to 100% of eligible project costs with interest rates at or below market rates, repayment periods of up to 15 years for revolving fund loans and 5 years for emergency fund loans, with counties and municipalities pledging homestead exemption reimbursements and sales tax distributions as security.

Creates a Local Governments and Rural Water Systems Improvements Board to oversee the program and grants the commission authority to establish per-connection fees, require water system viability analyses, and impose penalties for non-compliance.

Allows the commission to enter into capitalization grant agreements with the U.S. Environmental Protection Agency and collect administration fees up to 5% of loan amounts, with the program taking effect January 1, 2012 or upon federal funding authorization, whichever comes first.