Construction Financing

Since 1993, TSEP construction grants have been helping to finance infrastructure projects throughout Montana. TSEP grants have been used in combination with other grant and loan funding sources to make projects more affordable.

Application Process

Applications are only accepted every other year, since funding for TSEP projects is approved by the legislature. Applications are due the first week in May on even numbered years. Prospective applicants should contact TSEP staff as soon as possible to discuss their project and the application requirements. The TSEP Application Guidelines provides detailed information about requirements of the program and lists information required in the application. The application form and preliminary engineering report requirements are in a separate publication, the Uniform Application for Montana Public Facility Projects.

Grant Amount and Required Match

Construction grant applications are limited to a maximum of $750,000. A dollar for dollar match is required, but in cases of extreme financial hardship, where the public's health and safety are seriously affected, grants up to 75% of the project costs may be awarded. Matching funds can be public or private funds (cash, loans, and even other grants).

Eligible types of match:

  • funds expended for engineering studies, reports, and plans directly related to the proposed project during the period 24 months prior to the TSEP application deadline
  • funds expended after the TSEP application deadline for project management, final engineering design, and other reasonable expenses necessary to prepare the project as proposed in the TSEP application for the construction phase.
  • value of land or materials provided by the applicant, if properly appraised within a two-year period preceding the application deadline.
  • value of labor performed by the applicant's employees on the proposed project. Employees must be paid at his or her standard hourly rate of pay and the time worked must be adequately documented.
  • value of machinery used in the process of constructing the project that is owned (or leased) and operated by the applicant. The value of the use of the machinery will be determined using the Federal Emergency Management Agency (FEMA) equipment rate schedules.

    • Application Review Process

    TSEP applications are evaluated, scored and ranked based upon seven statutory priorities. In general, projects that solve serious health and safety threats, and have a serious financial need are likely to be more competitive and ranked higher than other proposed projects.

    The amount of TSEP grant funds recommended will be based on a financial analysis. Financial need for water, wastewater and solid waste projects is primarily determined by comparing the applicant's projected user rate to their "target rate," which is based on a percentage of the applicant's median household income. Grant funding will not be recommended for water, wastewater and solid waste projects that would result in user charges below the target rate.

    Financial need for bridge projects is determined by evaluating the amount of funds available to the county that could be used towards bridges on a per capita basis, and the number of bridges that the county is responsible for maintaining.