Purpose of Support

The South Australian Government with the support of the Natural Heritage Trust has allocated funding to the South East Confined Aquifer Well Rehabilitation Scheme. This scheme will provide financial support by way of grants and loans to landholders/ lessees in the Project Area of the South East of South Australia to facilitate the rehabilitation of poorly constructed confined aquifer wells.

This financial support will be fundamental in enhancing economic development in the region together with the protection and sustainable management of the valuable water resource.

Landholders/ lessees will be able to access financial support under this scheme for a range of options including:

• abandon and plug an existing artesian well;
• rehabilitate an existing artesian well; or
• drill a new artesian well and plug the existing well within 12 months of constructing the new well.
  

What type of support is available?

There are grants and loans available to support landholders / lessees (subject to the availability of funds in any one year):

Part A of the Scheme

• A grant of 100% of the eligible plugging costs (but not exceeding the actual cost of the work) to permanently abandon and plug an existing artesian well(s); and/ or:
• A grant of 30% of the actual cost, but not exceeding 30% of the eligible replacement costs, to replace an existing artesian well(s) of corresponding depth and diameter; or
• A grant towards the cost to rehabilitate an existing artesian well(s), but not exceeding 30% of the cost of a new artesian well of corresponding depth and diameter as defined under eligible replacement costs.

Part B of the Scheme

A loan up to 70% of the actual cost but not exceeding the eligible replacement costs is available to fund the landholder / lessee contribution toward the repair or replacement of existing artesian well(s). The loan will be repayable by annual principal and interest repayments over a maximum 5 year term. A maximum of $75 000 per artesian well shall apply. Payments must be at least annually.

Eligibility

General eligibility guidelines
Support under the guidelines may be made available to landholders/ lessees who:

• own/ lease land within the Project Area of the South East of South Australia;
• have a satisfactory Work Plan, prepared in conjunction with the Project Officer, which includes details as to how the landholder/ lessee proposes to eliminate uncontrolled flow from the confined aquifer and/ or reduce the risk of cross contamination between aquifers. The Work Plan must be technically sound and have demonstrable and beneficial long-term impact on the environment, land and community.

Other eligibility guidelines for Part B of the Scheme

• Satisfactory security, acceptable to the State Authority, is required to secure the loan. Security would normally be in the form of a Registered 1st or 2nd mortgage over land or a bank guarantee.
  NOTE: Financial details shall remain confidential between the applicant and State Authority and will not be subject to examination by the Steering Committee.
• Applicants who wish to secure the loan by way of a Registered mortgage over land must demonstrate long term prospects of financial and sustainable viability and ability to repay the proposed loan within 5 years. This is measured by the past and expected future profitability and performance of the applicant and the applicants ability to meet financial commitments relating to the costs of the business operation(s), living costs and servicing and repayment of debt.
  NOTE: Applicants securing the loan by way of bank guarantee will be required to provide limited information, as determined by the State Authority.

Conditions of Support

General Conditions
The State Authority shall ensure that the following conditions of support are imposed and are met:

• The support provided is used by the applicant for the purposes outlined under Purpose of Support and for no other purposes.
• Funding under this scheme will be made on an ongoing basis until funds are exhausted OR no later than 30 June 2010, whichever occurs first.
• Applications must be approved by the State Authority prior to commencing work specified in the Work Plan.
• The State Authority shall allocate funds to individual applicants taking into account the recommendation from the Department of Water Land and Biodiversity Conservation following consultation with the Steering Committee regarding the merit of the Work Plan.
• The works identified in the Work Plan must be completed by an Approved Contractor.
• The Work Plan must be commenced within 6 months and completed within 1 year of the date of the grant/ loan approval.
• Payment of the grant and loan will be made on completion of the proposed works, substantiation of costs including certified invoices and a final inspection by the Project Officer, certifying the works have been satisfactorily completed.
• Grants and loans may not be made in respect of a Work Plan for which the landholder/ lessee is already receiving Commonwealth or State government financial support.
• Funding permitting, applicants in receipt of support under this scheme will be permitted to make an additional application which may be further considered (up to the maximum support per well under this measure).
• The applicant agrees to provide information and feedback regarding the effectiveness of the Work Plan on completion.
• Support may be terminated and the applicant may be rendered ineligible for any assistance under the scheme where the applicant does not rectify, within a period notified by the State Authority, breaches of conditions of the support.
• Grants to rehabilitate an existing well(s) shall not exceed 30% of the eligible replacement cost to construct a replacement well of corresponding depth and dimension.
• Finance will not be available for the replacement or rehabilitation of satisfactorily constructed wells.
• Loans and grants for replacement wells are subject to the existing well being rendered inoperable immediately after the new well is operating and then backfilled/ permanently plugged within 12 months.
• Should the rehabilitation of an existing well fail, the landholder/ lessee will not be eligible to access a loan or grant for the construction of a new well, but may apply for a grant for the cost of plugging the existing well. The construction of any new well will need to be funded from the resources of the landholder/ lessee.
• Guidelines relating to the South East Confined Aquifer Well Rehabilitation Scheme may be varied by the Minister for Government Enterprises at any-time, without notice.
• A replacement well can be increased in diameter, however calculation of the 30% grant will be based on the dimensions of the existing well that is to be plugged.
• Should any surplus funds remain at the end of the scheme, the funds are to be equitably distributed to all participants (at the Ministers’ discretion), based on the successful completion of all 120 wells identified in the Project Area. This distribution is not to exceed the actual cost of the individual Work Plan.

Other conditions for Part B of the Scheme

• An interest rate of 3% will apply during the term of the loan, for all loans approved within 12 months of the commencement of this scheme. The interest rate may vary in subsequent years at the discretion of the Minister for Government Enterprises.
• In the event that the loan falls into arrears, an interest rate of 2% above the prevailing average secured overdraft rate at the 30th June each year will apply until such time as the arrears are cleared, unless special circumstances/ hardship exist. The rate will be determined by the Department of Water Land and Biodiversity Conservation taking into account the interest rates published by commercial financial institutions.
• Loans are not transferable and will become repayable in the event that the applicant ceases to be the owner/ lessee of the land on which the existing artesian well, which is the subject of repair or replacement, is located.
• Statutory fees including registration, stamp duty, search, certification and discharge fees, financier production fees plus any solicitor fees in relation to the preparation of loan documents will be payable by the applicant. There are no application, establishment, line, early repayment or service fees applicable to loans approved under this scheme.

How to Apply

An application form can be obtained direct from Grant Pearce, the Project Officer.

Telephone: 08 8735 1066
Facsimile: 08 8762 3397

Address:
Department of Water Land and Biodiversity Conservation
SGIC Building
11 Helen Street
MT. GAMBIER SA 5290

Postal: PO Box 1046
MT. GAMBIER SA 5290

Additional information can be obtained from:

Prudential & Rural Financial Services
Primary Industries and Resources SA
15th Floor, 25 Grenfell Street
GPO Box 1671
ADELAIDE SA 5001

Telephone: 08 8226 0240
Facsimile: 08 8226 0229

Toll Free: 1 800 182 235

PIRSA - fax

24 hour - 7 days a week rural information access:
Access via 1902 940 698 or 0055 34 231

The South East Confined Well Rehabilitation scheme is jointly funded by Department of Water Land and Biodiversity Conservation and the Natural Heritage Trust program.