Responsible, Sustainable & Affordable Economic Development in New Jersey
By Chris Colabella
The New Jersey Environmental Infrastructure Trust, a fund that provides low-cost financing for the construction of environmental infrastructure projects, may very well be the shining star on the late Robert Briant Sr.’s list of lifelong accomplishments. Indeed, the fact that New Jersey enjoys a national reputation as a leader in innovative and effective environmental protection strategies is owed – at least in considerable part – to Briant’s efforts to encourage responsible and sustainable economic development in the Garden State.
Bob Briant Jr., Briant Sr.’s son and, perhaps, his most notable accomplishment, is poised to continue his father’s footsteps – having joined the Trust’s board since his dad’s passing on Feb. 27, 2013.
Bob Briant Sr. understood that you can’t push too hard against the environment or development. You have to get the two to work together. — David Zimmer, New Jersey Environmental Infrastructure Trust
“I wish to continue my father’s efforts to always look to increase funding for the infrastructure needs of New Jersey as well as work to streamline the funding processes of the Trust,” said Briant Jr., noting the construction landscape in New Jersey would look quite different today if it weren’t for his dad’s commitment.
“I believe the industry would be more fragmented and certainly the many achievements — laws and regulatory changes, funding, etc. — that have provided a better working environment for the industry, would not have taken place.”
Since its creation in 1986, as the first program of its kind in the country, the Trust has played a major role in helping New Jersey meet one of its most fundamental environmental priorities — maintaining and improving the quality of water resources.
However, David Zimmer, CFA, and executive director of the Trust, says controlling pollution and providing safe, abundant drinking water requires heavy capital investment. “Environmental infrastructure is costly to build and that expense is ultimately born by the individual ratepayer and taxpayer. Keeping costs to the public as low as possible has been the role of the Trust since its inception.”
Enter the Clean Water Construction Coalition, formed in an effort to bring federal dollars to the N.J. Environmental Trust. The Coalition, whose first meeting was conducted by Briant Sr. in 2005 when he was CEO of the Utility and Transportation Contractors Association of New Jersey, is a national organization of construction associations formed to promote federal legislation that improves water and wastewater infrastructure on a national level.
Briant Sr. served as the Coalition’s first chairman and Bob Jr. has recently been elected to the position of chairman.
“Sustainable living means doing right by the environment so the environment can do right by you. You have to balance the need for growth with environmental consciousness,” said Zimmer. “Bob understood that. He understood you can’t push too hard against the environment or development. You have to get the two to work together. At the end of the day, he led the Trust and the Coalition as vehicles for public policy implementation.”
Working in partnership with the N.J. Department of Environmental Protection, the Trust leverages funds available from the federal government to make more money available at the lowest possible cost. Since 1987, the Trust’s Financing Program has provided more than $4.3 billion to local and county government units and some private water companies to finance wastewater systems, combined sewer overflow abatement, nonpoint source pollution control, safe drinking water supplies and open space acquisition.
Zimmer said there is no way qualified entities in New Jersey can borrow money at a cheaper rate than with the Trust. “The Trust has the ability to reduce interest costs to the point where a qualified borrower will pay between 25 to 35 percent of the total loan value. There isn’t a lending program in the state, public or private, that can produce that kind of value for ratepayers and tax payers.”
As an example, Zimmer said: “Let’s say a town wants to borrow a million dollars from the Trust; our rate is about 65 basis points for 20 years. The U.S. government can’t even borrow at that rate for 20 years! So, on a million dollars, a Trust loan would cost about $70,000 in interest. Even if a well-rated New Jersey town did that on its own, it would pay three percent That adds up to $1.35 million in interest over 20 years.”
An added benefit of the Trust’s Construction Loan program is that borrowers may take up to 36 months for construction, and repayments don’t begin until the job is complete, Zimmer said, noting that if delays occur, a borrower may be required to start repayments before construction is completed.
“Let’s say you are doing a sewer deal that includes extending pipe to 20 houses. Until you get that pipe in the ground, you won’t be collecting sewer fees,” he explained. “The Trust will let you defer the principal and interest up to construction completion as long as it happens in under 36 months.”
The format, Zimmer added, creates a unique cash flow management strategy for borrowers.
While the amount of money lent varies each year, “qualifying borrowers have never been turned away since the program’s inception in 1987,” Zimmer said. Loans have ranged from $50,000 to $214 million.
The N.J. Environmental Trust’s Loan Process:
Initial loan applications must be e-filed at www.njeit.org/njeifp during the first week of October each year. The total application packages, with documentation of engineering specifications, are due to be filed the following March.
All applications are reviewed by the N.J. DEP; the projects are then vetted and bonded.
For more information, visit 222.njeit.org.
Chris Colabella is the president of CIS, Inc., New Jersey’s only local construction lead service. For more information, visit www.cisleads.com or call 800- to arrange for a free demo of CIS Leads.