COMCOR 19.29.01 Stormwater Management Loan Program
Chapter 19. Erosion, Sediment Control and Stormwater Management - Regulations
Montgomery County, Md., COMCOR § 19.29.01.01 (2026)
19.29.01.01 Background InformationLinkCopy Citation
1.1 On November 20, 2001, the County Council amended County law regarding storm water management facilities by enacting revisions to Sections 19-20 through 19-35 of the Montgomery County Code. These amendments create a loan program to help property owners upgrade their storm water management facilities to meet approved design standards. The countywide storm water program will provide publicly funded maintenance to replace private maintenance for the facilities that have been improved through County loans and subsequently accepted by the County for continued maintenance. The loan program, which is to be administered by the Department of Environmental Protection ("DEP" or the "Department"), is designed to promote a countywide storm water maintenance program. These amendments enable the County to comply with the requirements of the NPDES (National Pollutant Discharge Elimination System) permit, issued to the County under the authority of the federal Clean Water Act.
Montgomery County, Md., COMCOR § 19.29.01.02 (2026)
19.29.01.02 Administration and ProceduresLinkCopy Citation
2.1 Use of Funds
The principal use of funds from the Storm Water Management Loan Program (the "Program") is to facilitate the repair and upgrade of storm water management structures belonging to private property owners by helping the owners restore the structures to their originally approved design standards or better if required under existing law or agreed to by the County and the property owner. The funds may also be used to help repair any property damage associated with the restoration or upgrade of a storm water management structure. Once this is accomplished, borrower must enter into an agreement with the County providing for the restored structure to subsequently be publicly maintained under the County-wide storm water management program.
2.2 Limitations on Use of Funds
The use of funds from the Storm Water Management Loan Program, as described in Section 2.1, is subject to the following limitations:
a. The proposed scope of work must be pre-approved by DEP.
b. Before authorizing direct disbursement of any payments due to a contractor that the borrower has hired to upgrade a storm water management facility under an agreement created solely between the borrower and the contractor, DEP must confirm that the contractor has either performed or made satisfactory progress toward performing the pre-approved repairs and maintenance work correctly and in accordance with the agreed upon scope of work.
c. The County must make loan payments directly to the contractor on a draw down schedule consisting of installments. The first installment of 25 percent of the total sum due under the contract is payable only after the County receives a request for payment from the borrower in a form approved by the County and the Department has verified that the contractor has ordered materials and begun performance. The remaining installments are payable at various completion stages under the agreed upon scope of work. In each instance, the borrower must request payment from the County and the Department must verify that the contractor has performed each repair or maintenance task correctly before the County may authorize a payment to the contractor.
d. Any contractor that a borrower hires to upgrade a storm water management facility must execute a performance bond naming Montgomery County as the obligee before the County may pay the contractor under the Program.
e. A borrower must not use County funds to pay for a contractor's unanticipated costs. All cost overruns are the responsibility of the borrower, not the County.
2.3 Application Procedures
The Director approves and denies loans for property owners who apply for funds under the Storm Water Management Loan Program. The Director may delegate this authority. Applications must be submitted in writing in a form approved by the Department and forwarded, along with the financial information described in Section 2.6, to the following address:
Director
Department of Environmental Protection
255 Rockville Pike, Suite 120
Rockville, Maryland 20850
2.4 Lending Standards
When reviewing applications for the use of funds from the Storm Water Management Loan Program, the Director must consider the following factors:
a. Existing commitments for use of the funds;
b. The existence and expectation of funds projected to be available in the program;
c. The degree to which the proposed use of funds will further DEP's storm water quality and quantity control goals;
d. Financial requirements and capacity to repay the loan as described in Section 2.6; and
e. Other factors that the Director deems consistent with Department goals of preparing storm water management facilities for public maintenance.
2.5 Priorities
a. The Director may give priority to loan applicants who propose to upgrade the following facilities and structures:
(1)
Ponds with structural problems that prevent them from functioning as designed (e.g., dry ponds that are full of water, wet ponds that are leaking);
(2)
Dams classified as high or significant hazards with structural problems involving the dam or pond controls that could cause an increased potential for failure;
(3)
Underground structures (metal pipes especially) with structural problems that could cause a parking lot to collapse and cause injuries or significant property damage;
(4)
Structures with other safety problems;
(5)
Larger ponds (i.e., drainage area larger than 50 acres) with structural problems; and
(6)
Smaller facilities with structural defects in the pipes, controls, concrete structures or embankment.
b. In addition to the priorities described in this Section, the Director may take into account the size of the drainage area served by a storm water facility and may also approve loans for applicants to upgrade other types of facilities and structures, including the following:
(1)
Facilities with a great pollution potential if not repaired and maintained. (This category includes old oil grit separators, because of the limited storage provided and the nature of collected road and parking lot pollutants.)
(2)
Nonfunctioning structures that offer real opportunity for environmental improvements through repair or replacement (i.e., wetland habitat potential).
(3)
Wet ponds that create temperature discharge problems for temperature sensitive downstream waters.
(4)
Structures, as determined by the Department, where abandonment, or removal is environmentally and economically prudent.
2.6 Financial Requirements
a. Funds to be disbursed under this program are available to property owners who demonstrate, to the satisfaction of the Director, that they are able to repay the loan. The Director must not approve a loan application unless the Director finds that an applicant's credit record, if applicable, includes the following information:
(1)
The income generated or potentially generated by the applicant;
(2)
The current expenses or anticipated expenses of the applicant;
(3)
The amount of any outstanding loans and the monthly payments required to repay the loans;
(4)
Other financial resources that the applicant indicates are available to repay the loan;
(5)
The ability of the applicant to generate additional fees or contributions to repay the loan;
(6)
The credit history of the applicant, if applicable; and
(7)
The collateral that the applicant is willing to offer as security.
b. The applicant must furnish the following financial information when submitting the loan application to DEP for review:
(1)
Financial statements, which at a minimum include a Statement of Position (i.e., balance sheet) and a Statement of Operations (i.e., income statement) for the most recent fiscal year, preferably accompanied by an independent public accountant's report;
(2)
An itemized budget reflecting revenues and expenditures for the current fiscal year, and next fiscal year, if available;
(3)
Descriptions and cost estimates of the repairs and maintenance work needed to restore the facility;
(4)
A description and estimated value of collateral that the applicant is willing to offer as security.
(5)
Copies of federal and state tax returns for the 3 previous years, if applicable;
(6)
Proof of other financial resources available to repay the loan; and
(7)
Any other financial information that the Director may from time to time deem necessary to adequately assess the creditworthiness of loan applicants.
c. Common ownership communities. Subsection b(l) is not applicable if the borrower is a common ownership community such as a condominium or homeowners association. For a common ownership community association to be eligible for a loan under the Program, the association's governing documents must not prohibit the association from assiging special assessments or monthly assessment income as collateral for the loan.
2.7 Loan Terms and Conditions
a. The maximum repayment term for any loan under the Storm Water Management Loan Program is 10 years.
b. Loans made available through the Program carry an interest rate equal to the County's current rate of earnings on invested funds on the day that the loan is approved, plus an additional one percent to cover administrative costs. The interest rate must remain constant for the full term of the loan.
c. Borrowers must make all payments according to the time and frequency schedule stipulated in the loan agreement.
d. The Director must not forgive a loan. However, the Director may defer payments when a borrower demonstrates, to the satisfaction of the Director, a sufficient temporary hardship to significantly impede the borrower's ability to make timely payments. The Director may approve a deferral request for a period not to exceed 6 months. The Chief Administrative Officer must approve any subsequent deferral of the same loan.
e. During any period of deferment, the borrower has the option to:
(1)
continue paying the accrued interest while only the principal of the loan is deferred; or
(2)
defer both the principal and the interest so that the deferred interest continues to accrue during the deferment period.
2.8 Appeals
An applicant whose loan request is denied for any reason other than insufficient funds in the Program to approve the request may make a formal request for reconsideration of the decision to deny the loan by filing an appeal in writing with the Director within 30 days after the applicant receives written notification that the loan was not approved. The Director must review the request for reconsideration and render a final written decision on behalf of the County within 30 days after receiving the appeal.
2.9 Loan Nonpayment or Default
The Director must forward any loan that the Director deems to be in default under the terms of the loan agreement to the Office of the County Attorney within one month after the date of the default to initiate collection efforts.