Bill expands eligibility for low‑interest state water loans to certain non‑government water authorities

Sen. Bart Hester told the Insurance & Commerce Committee that Senate Bill 420 makes nongovernment water and sewer authorities eligible to apply for low‑interest loans administered through the Arkansas Department of Agriculture’s Natural Resources Commission. The bill does not add eligibility for principal forgiveness, sponsors said.

Hester said the change would let entities such as Liberty Authority and Hot Springs Village access low‑interest financing currently limited to government‑owned utilities. "I don't think the people of our districts care if it's public or private. They just need good clean water at a good rate," Hester said.

A representative of the Arkansas Department of Agriculture explained the Natural Resources Commission operates multiple financing programs, uses general‑obligation bond authority to leverage federal funds, and that loan rates vary with market conditions but are generally below commercial borrowing costs. The witness estimated statewide water and wastewater needs at about $13 billion.

Committee members asked whether for‑profit entities would compete fairly with nonprofit or government systems for loan dollars and whether loan use would help avoid large consumer rate increases. The department witness said applications would be competitive and similar rates would be offered to eligible applicants; the commission ranks applications and allocates limited funds.

Sen. Flowers moved and Sen. McKee seconded a motion to report the bill Do Pass; the committee approved SB420 by voice vote.