PENN TWP — Butler County Commissioners are planning to use Act 13 money to start a low-interest loan program for municipal infrastructure projects.

The program, which is still being developed, would use about $490,000 this year to subsidize the interest on between $20 million and $40 million in loans through the Pennsylvania Infrastructure Bank.

The commissioners already passed a resolution dedicating 45 percent of its natural gas impact fee money allocated from the state to the program.

Representatives from more than 40 municipalities and municipal authorities heard a presentation about the loan program Thursday night at the township municipal building during the Butler County Council of Governments meetings.

Butler County is the second county in the state to plan or start such a loan program, Commissioner Kim Geyer said.

The commissioners got the idea after hearing about a successful loan program in Dauphin County. Dauphin used Act 44, or liquid fuels money, along with revenue from local casinos.

The program also will include what officials call a “turnkey” option, where smaller municipalities can get help with the design and engineering aspects of a project.

“This will be really helpful for municipalities that don’t have engineers on staff that get hung up on design and preliminary engineering on a project when trying to get state grants,” Geyer said.

Commissioner Kevin Boozel said the program will be a productive way to use the Act 13 money to help with economic development.

“We’re excited to see Butler County and all the municipalities grow,” he said.

The county is working with Herbert, Rowland and Grubic engineers and Community Networking Resources, two firms that set up and assist with running the program in Dauphin County, where about $18 million in projects have been funded during the past four years.

Though the amount of Act 13 money given to the county is bound to fluctuate, officials think the program could continue with new loans being approved every year.

“As envisioned, this program will be around for a long time,” said Dan Santoro, a regional office manager with HRG.

Projects that would qualify would include construction or replacement of bridges and roads; improvements or expansions of public water, stormwater or sewer systems; public transportation or utility infrastructure; and, for the first year only, costs associated with new portable radios for emergency responders, who will be upgrading next year.

The Infrastructure Bank is a program through the state Department of Transportation that lends money to local governments at a 1.875 percent interest rate, according to its website. Other state programs, such as PennVest, also are options for getting financing, officials said.

Tentative numbers displayed by HRG Thursday indicated that with the county’s subsidy applied, municipalities could pay interest rates ranging from 0.5 to 1.5 percent.

Officials hope to finalize the guidelines for the program by July and accept applications from August to November of this year. Loan closing would be done by August 2018 and construction of the project should happen during the summer of 2019.

HRG distributed surveys to the representatives in attendance, but by a show of hands Thursday more than half of the municipalities said they were interested in applying for loans.

Buffalo Township Supervisor John Haven said loan money could help the township get a state grant to improve the intersection of Cole Road and South Pike Road.

The township two years ago pursued grant funding, which it did not get, and had design work done for a project to add left and right turning lanes for eastbound traffic on Cole Road.

Cole Road gives access to Freeport High School and Freeport Middle School and is used by up to 23,500 vehicles each day.

“This would be excellent. We have everything all drawn up already,” Haven said.