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Sources of Financial Assistance to Drinking Water Systems

System improvements can be funded by raising rates, issuing bonds, or by successfully applying for loans or grants. The table below provides information on some programs that may provide financial assistance to help you raise the money your system will require to maintain its assets in good condition, replace deteriorated assets, and continue to provide safe and secure drinking water to your customers. Contact your State or Regional Tribal Capacity Development Coordinator and the Public Service Agency through Primacy Agencies or Tribal Contacts for more information.

Major Providers of Financial Assistance to Drinking Water Systems
Name of Program
Contact Information
Drinking Water State Revolving Fund (DWSRF)
These state-administered loans enable water systems to finance infrastructure improvements, provide training, and fund source water protection activities.
Safe Water Drinking Hotline at (800) 426-4791
Rural Utilities Service (RUS) Water and Wastewater Loan and Grant Program
This program offers loans and grants to develop water and waste-disposal systems in rural areas to reduce user costs.
(202) 720-9540
State-specific programs
Your state may offer additional funding programs.
Tribal-specific programs
EPA gives grants (not loans) to tribes through the DWSRF Tribal Set-Aside program for improvements to water systems that serve tribes. States and the Indian Health Service may provide additional financial assistance.


Other Potential Sources of Financing or Financial Assistance for Drinking Water Systems
Name of Program
Contact Information
Community Development Block Grants (CDBG)
This program offers grants to disadvantaged cities, urban counties, and states to develop viable communities.
(202) 708-1112
Public Works and Infrastructure Development Grants
These grants help distressed communities overcome barriers that inhibit the growth of their local economies.
(202) 482-5081
National Bank for Cooperatives Loan Program (CoBank)
CoBank provides loans to larger credit-worthy rural utilities.
(800) 542-8072
Rural Community Assistance Corporation (RCAC)
RCAC provides loans to rural utilities in 11 western states to help meet the financing needs of rural communities and disadvantaged populations.
(916) 447-2854
Small Business Administration (SBA)
SBA helps small businesses get low-interest loans.
(800) 827-5722
Local Commercial Banks
Banks in your community can offer loans to help finance capital improvements. Although interest rates may not be as favorable as other options, it may be easier for you to negotiate a loan through a local bank.
Talk to your city clerk about what banks in your area most closely match your needs.

Before you apply for funding, find out what each source will pay for and what information they will need to consider in your application. Ask about local matching fund requirements, application procedures, what makes a project “fundable,” and special program requirements and restrictions. Ask to see applications from previously funded projects. Get an idea of what information is required for an application; most lending and granting agencies will want to see financial statements such as budgets, income statements, and cash flow documents. Publicly-owned systems may need a clean opinion from an auditor to show good accounting practices and/or compliance with GASB 34.

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Appendices   Introduction to GASB 34