Adopt Resolution #22-065 Authorizing Staff to Apply for Water Efficiency Grant Funds through the Metropolitan Council for 2022-2024

In 2019, the City of Ramsey applied for a Water Efficiency Grant through the Metropolitan Council and was awarded $28,000. The grant funds have been used to provide rebates to residential and commercial/HOA property owners that replace water using devices (initially, toilets and irrigation controllers, recently expanded to include washing machines) with WaterSense or ENERGY STAR® rated devices.

The Metropolitan Council has announced that it is once again offering a Water Efficiency Grant. Applications are due by March 31, 2022 and grant recipients will be announced by April 29, 2022. The grant program will run from July 1, 2022 through June 30, 2024.

The current grant program runs through June 30, 2022. If the City were to apply for the next round of funding and was successful, there would be a seamless transition from the current grant cycle to the new grant cycle. The Metropolitan Council has upped their contribution to program costs from 75% to 80%, which means the City's required matching component is reduced from 25% to 20%. Not only has the Metropolitan Council's contribution increased, but they have also expanded the eligible products/devices list to include ENERGY STAR® rated dishwashers (in addition to ENERGY STAR® rated washing machines and WaterSense labeled toilets and irrigation controllers and sprinkler bodies).  The minimum grant amount is $5,000 and the maximum amount is $50,000.

Grant criteria remain the same: rebate applicants must be a municipal water customer; rebates are only applicable to replacement devices (does not cover new construction/development); and at least a portion of the cost must be paid by the property owner (Ramsey accomplished this by having property owners be responsible for the sales tax).  The deadline for submitting an application is March 31, 2022.   Grant recipients will be notified no later than April 29, 2022 and would need to enter into a grant agreement with Metropolitan Council (similar to current grant program).

Through the current grant program and participation by residents, it is estimated that there's been water savings of approximately 2,200,000 gallons. This is based on the estimated average annual water savings of replacing older, inefficient devices with grant eligible products, the total number of participants (to date, 84 residents and 1 HOA), and the devices that have been replaced.

The City still has a little less than $13,000 in grant funds available through June 30, 2022. It is a bit surprising that there has not been greater demand for the program. However, Staff still sees this program as a great opportunity for all municipal water customers in the community. Staff has utilized the website, newsletter, social media, and the dynamic display sign on Highway 10 to promote the rebate program. The Metropolitan Council is creating a ShareFile that will allow communities to share and access marketing pieces related to this program.  Staff will explore what other communities have done to promote their programs and also consider other social media platforms, such as Nextdoor (other communities have indicated they've had success with that).  

Staff would recommend some program modifications (from current rebate program) that might help increase participation. First, do not limit which devices/products are eligible for rebates. Whatever devices are eligible per the grant program guidelines should be part of the City's program. Secondly, consider an increase for the total cap per property (currently, these are set at $500 for residential properties and $1,400 for commercial and Home Owners Association properties). Third, the City can and should take advantage of this program for some of the public buildings and grounds (the City can apply for rebates for device replacement). 

Funding for the Water Efficiency Grant Program would consist of three sources: Grant award from the Metropolitan Council (assuming Ramsey was a grant recipient), the City's required 20% match would come from the City's Water Fund, and any rebate participant would cover the sales tax on the purchase of the device (thus satisfying the requirement for the rebate participant to have a financial contribution in the program) plus any amount that exceeds the per device cap.

The Environmental Policy Board reviewed this opportunity at their February 28, 2022 meeting and recommended the City apply for grant funds for the 2022-2024 funding cycle.

Motion to adopt Resolution #22-065 authorizing Staff to prepare and submit an application to the Metropolitan Council Environmental Services for water efficiency grant funding for 2022-2024.