For a WWD project to be eligible for a loan guarantee under this part, it must meet the criteria specified in § 5001.102 and this section and be for a borrower eligible to submit an application for the project in accordance with § 5001.126.

(a) Type of project. The project must be for one or more of the following facilities:

(1) Drinking water facilities, including but not limited to water source, treatment and distribution;

(2) Sanitary sewage facilities, including but not limited to collection and treatment;

(3) Solid waste facilities; or,

(4) Stormwater facilities.

(b) Public use. The project must be for a public purpose.

(c) Project location. The project must be located in a rural area as defined in § 5001.3 of this part, except that utility projects serving both rural and non-rural areas are eligible for a loan guarantee regardless of project location. For utility service projects serving both rural and non-rural areas, the Agency will guarantee only the portion of the project necessary to provide the essential services to rural areas. The part of the facility located in a non-rural area must be necessary to provide the essential services to rural areas.

(d) Service area. (1) The project must be installed to serve any user within the service area who desires service and can be feasibly and legally served.

(2) The lender must determine that, when feasible and legally possible, inequities within the project's service area for the same type service proposed will be remedied by the borrower on, or before, completion of the project. Inequities are defined as unjustified variations in availability, adequacy, or quality of service. User rate schedules for portions of existing systems or facilities that were developed under different financing, rates, terms, or conditions do not necessarily constitute inequities.

[85 FR 42518, July 14, 2020, as amended at 86 FR 70355, Dec. 10, 2021; 89 FR 79710, Sept. 30, 2024]