Notes to SEFA
Title: Drinking Water State Revolving Fund Information
Accounting Policies: The schedule of expenditures of federal awards presents the activity of all federal award programs for the Authority of the year ended December 31, 2024. Because the schedule presents only a selected portion of the operations of the Authority, it is not intended to and does not present the financial position or changes in net position of the Authority. The accompanying schedule of expenditures of federal awards is prepared on the accrual basis of accounting.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
On March 27, 2024, the Authority obtained a Drinking Water State Revolving Fund Loan from Pennvest in the aggregate principal amount of $1,840,242. The proceeds are being used by the Authority to finance capital projects for the water system. The loan has an interest rate of 1.743% from years one through five and an interest rate of 2.179% from years six through twenty. Proceeds from the loan shall be available to the Authority on a draw down basis through and including March 1, 2025. Interest only payments will be made until the principal amount is fully drawn upon. As of December 31, 2024, the Authority had drawn $1,437,722 of the total amount of the debt and is in the process of drawing down the remaining available funds. The total outstanding and due to the Pennsylvania Infrastructure Investment Authority at December 31, 2024 was $1,437,722. The amount of federal expenditures for the program listed on the schedule represent the expenditures incurred under the loan during the year ended December 31, 2024. The United States Environmental Protection Agency requires that the current year expenditures incurred under the loan be reported on the schedule rather than the beginning balance of the loan. Therefore, the Authority has no ongoing compliance requirements other than those relating to the year in which the expenditures are incurred. The outstanding debt is shown as liabiltities on the Authority's Statement on Net Positon and for this reason is not shown as revenue on the Schedule of Expenditures of Federal Awards.