FUNDING
COLLABORATION
Maximizing the Impact of Project Funding to Increase
Compliance and Enhance Public Health
State drinking water program administrators, managers and staff are
faced with unprecedented challenges today. Ensuring compliance with
new and existing drinking water rules, as well as managing drinking
water programs during a time of shrinking budgets and diminished
resources requires strong leadership, innovative thinking and the
sharing of ideas. This fact sheet was prepared for state leaders to share
their ideas and practices in the area of funding collaboration.
What is "funding collaboration"? Funding collaboration involves the
deliberate coordination and careful targeting of available funding
sources to achieve maximum efficiency and derive the most benefit
from each dollar spent.
How can funding collaboration help my state? Efficient use of
available funds can stretch the impact of dollars spent and maximize
the long-term performance of drinking water systems, helping them to
achieve their public health protection goals.
What will I find in this fact sheet? This document highlights
innovative approaches to funding drinking water infrastructure
projects using four models for collaborating. The description for each
model is followed by several state examples describing challenges
states faced and how funding collaboration helped address these
challenges. The four specific models discussed in this document are:
Supporting Small Systems
Through the Drinking Water State
Revolving Fund
Encouraging Sustainable Activities
by Allocating Funding
Priority Points
Diversifying Funding Sources
to Fund More Projects
Assisting Loan Applicants
Through Funding Workshops and
Third-Party Assistance
-------
Supporting Small Systems
Through the Drinking Water State
Revolving Fund
The Model: The Drinking Water State Revolving Fund (DWSRF) was established to provide
eligible public water systems (PWSs) with loan assistance for infrastructure improvements
related to the provision of safe drinking water. The DWSRF provision of the Safe Drinking
Water Act acknowledges the importance of enhanced management and operation by allowing
states to reserve a portion of their capitalization grants to fund activities that enhance system
capacity as well as to fund other critical state drinking water program activities. These funds
are referred to as the DWSRF set-asides.1 For more information about how states use set-
asides, please see the October 2010 report Analysis of the Use of Drinking Water State Revolving
Fund Set-Asides: Promoting System Sustainability.2
Over the years, states have found innovative ways to use the DWSRF and its set-asides to fund
projects that help systems achieve and maintain technical, managerial and financial (TMF)
capacity. This creativity allows states to directly support PWSs in addressing capacity and
sustainability challenges. Following is a summary of three state examples showing how the
DWSRF is used to fund small system needs.
Figure 1: States Featured as Model 1 Examples
The states that are shaded dark blue and that include the state abbreviation represent the state examples
found in Model 1 of this document. The striped states represent the state examples found in Models 2-4.
http://water.epa.gov/grants_funding/dwsrf/index.cfm#facts
http://water.epa.gov/type/drink/pws/smallsvstems/state_guidance.cfm
Page 2
-------
MAINE: USING THE DWSRF
TO HELP VERY SMALL SYSTEMS
RETURN TO COMPLIANCE
Visit http://maine.gov/dhhs/eng/water/financiaLresources/SRF.htm
CHALLENGES
Maine's PWS inventory includes many very small drinking water systems (those serving 100 or
fewer customers).
A number of Maine's very small systems struggled to comply with Safe Drinking Water Act
(SDWA) requirements and needed funding to make the changes that would help return them to
compliance.
These systems often lacked the knowledge and resources to apply for DWSRF funds and/or did
not want to go through the time-intensive DWSRF application process because the amount of
funding they needed was typically very small.
SOLUTIONS
Maine's Very Small System Compliance Loan Fund, created in 2010, helps very small systems
achieve compliance with new and current SDWA standards (excluding the Total Coliform Rule
[TCR]). TCR-related issues were excluded for multiple reasons: 1) installation of disinfection by
small systems has generally not been an issue primarily due to the affordability of disinfection
systems; 2) the potential volume of applicants for installation of disinfection would likely be
significant; and 3) other compliance issues, such as uranium and arsenic, present a greater
financial barrier and are therefore a higher funding priority for the state.
The Fund puts aside $500,000 annually and offers loans of up to $50,000 to help any non-profit
non-transient non-community water system or any community water system (CWS) that
services 100 or fewer customers to address SDWA compliance issues.
There is no application period and the loans are provided at 100 percent principal forgiveness,
with overhead costs rolled into the loan.
SUCCESS MEASURES
To date, the Fund has supported 11 projects that are either complete or currently
underway. Loans awarded total nearly $250,000.
Ten projects involved installation of treatment to address arsenic, radon, or uranium issues.
One other project involved connecting to another PWS to address a gross alpha-radon
compliance issue.
These projects would most likely not have been funded without this initiative. Maine
expects that all systems funded through this initiative will be able to maintain compliance
and deliver higher quality water to their customers.
PageS
-------
SOUTH DAKOTA: USING THE
DWSRF TO PROMOTE COMMUNITY
PLANNING AND RATE ANALYSES
Visit
http://denr.sd.gov/dfta/wwf/statewaterplan/smallcommunitvplanning.aspx
CHALLENGES
Many of South Dakota's small systems were under-charging their customers because they did
not have a method to determine what their appropriate rates should be.
Many small systems would also apply for funding from the DWSRF or from South Dakota's
Consolidated Water Facilities Construction Program (a state program that provides loans for
water-related projects) without ever contacting an engineer to look at the system.
Without a preliminary engineering report (PER), the state did not have a sense for whether the
proposed projects were based on sound engineering principles which experienced engineers
could recommend. Furthermore, the state found that PWSs without PERs were not planning
proactively and not considering projects that could get the most benefit for the dollars spent
SOLUTIONS
South Dakota now requires systems to have an engineering firm complete a PER in order for
the system to be eligible for any loans from the DWSRF or the Consolidated Program.
Small communities (serving 2,500 or fewer people) can receive financial assistance to complete
this PER through the Small Community Planning Grant (SCPG) Program, which utilizes the
Small System Technical Assistance Set-Aside [SDWA Section 1452(q)]. Participating systems
are reimbursed for 80 percent of the cost of their engineering study, up to a maximum
reimbursement of $8,000 (e.g., for a $10,000 study).
Additional grants are provided for studies that incorporate a rate analysis using the Show-me
Ratemaker software.3 Reimbursement for performing a rate analysis is 80 percent of the cost
of the rate study, up to a maximum reimbursement of $1,600.
SUCCESS MEASURES
As of December 2010,145 SCPGs have been approved by the state.
There have been 72 DWSRF loans for infrastructure improvements awarded to communities
that received SCPGs. This number does not include any loans/grants provided to SCPG-
approved communities through the Consolidated Program, so the actual number of SCPG-
approved communities receiving funds courtesy of SCPGs is likely higher.
The SCPG Program also has provided 33 funding awards to assist communities in maintaining
compliance with SDWA regulations and four funding awards to assist communities in returning
to compliance with SDWA regulations.
All communities that have completed a rate analysis reimbursed through the SCPG Program
have raised their water rates to more appropriate amounts.
3 The Show-me Ratemaker software can be accessed through the New Mexico Environmental Finance Center's website:
http://nmefc.nmt.edu/AssetManagement.php
Page 4
-------
MISSOURI: USING THE
DWSRF SET-ASIDES TO FUND
IMF ASSESSMENTS
Visit www.dnr.mo.gov/env/wpp/dw-index.htm
M
CHALLENGES
Missouri has concentrations of small systems throughout particular regions of the state.
Like many small systems across the nation, many of Missouri's small systems struggle with
attaining and maintaining technical, managerial and/or financial capacity. Significant barriers
include:
Limited financial resources.
Lack of a properly certified operator.
Insufficient training for board and council members.
Inadequate or nonexistent long-term planning strategy.
SOLUTIONS
Missouri uses an electronic sanitary survey that includes elements of TMF capacity and stores
these surveys in a database that can be queried to evaluate systems' TMF capacity.
Missouri uses TMF Checklists, along with Construction Authorization Permits and Permits to
Dispense, as control points to ensure that new systems have TMF capacity elements in place
prior to becoming active PWSs.
In addition, the Public Drinking Water Branch contracts with the Missouri Rural Water
Association (MRWA) for three small system circuit riders to assist state-prioritized PWSs with
leak detection, energy efficiency assessments, long-term strategic planning, various compliance
issues, operator certification, and assessing, obtaining and maintaining their TMF capacity.
These activities are funded using the 15 percent Local Assistance Set-Aside.
SUCCESS MEASURES
Using EPA's Enforcement Targeting Tool4 formula, 20 percent of Missouri's PWSs that are
required to maintain TMF capacity (i.e., CWSs and non-transient non-community water systems
[NTNCWSs]) had scores of 11 or more points in January 2011. By April 2011, the percentage of
PWSs with 11 or more points dropped to 14 percent. Circuit riders' assistance for small PWSs
with compliance issues could be one reason for the decline.
Missouri is currently developing a comprehensive database to track PWSs that are required to
maintain TMF capacity. The database will include parameters that may indicate TMF capacity
such as: violations, employment of a properly certified operator, sanitary survey data
(currently recorded in the Safe Drinking Water Information System (SDWIS) database), TMF
survey results, project information and assistance provided. Missouri's objective is to have all of
the state's data and information on TMF capacity stored in one location.
Missouri is looking to implement a TMF survey that will be mailed to all PWSs in the state. The
TMF survey will address critical TMF items and provide a more in-depth assessment of TMF
capacity than what is provided by sanitary surveys. The new survey information will be
maintained in a database and used to identify systems needing assistance with TMF capacity.
http://www.epa.gov/compliance/resources/policies/civil/sdwa/drinking_water_erp_2009.pdf
Page 5
-------
Encouraging Sustainable Activities
by Allocating Funding
Priority Points
The Model: States are aware of sustainable practices, such as asset management and periodic
rate analyses, that are not mandated by regulation but that are able to help systems operate
efficiently, become financially self-sustaining, and achieve and maintain long-term compliance
and capacity. How can a state encourage these beneficial practices that are not mandated by a
regulation?
Many states have leveraged DWSRF loans and grants to promote non-mandated, sustainable
practices. One way of doing this is by assigning "priority points" if a system either
demonstrates that it has completed one of these activities or agrees to complete it as a
condition of the DWSRF award. Priority points increase a potential project's ranking on the list
of state projects and therefore improve the project's likelihood of receiving funding. Following
is a summary of three state examples showing how allocations of DWSRF priority points are
being used to encourage systems to engage in sustainable activities.
Figure 2: States Featured as Model 2 Examples
The states that are shaded dark blue and that include the state abbreviation represent the state examples
found in Model 2 of this document. The striped states represent the state examples found in Models 1, 3, & 4.
Page 6
-------
KANSAS: ASSIGNING PRIORITY
POINTS FOR BOARD
MEMBER TRAINING
Visit http://www.kdheks.gov/pws/capdev.html
and click on the KanCap Brochure link
CHALLENGES
Board members play an integral role in supporting PWSs. However, many board members don't
have a comprehensive understanding of the complexity involved in running a water system.
Kansas recognized that board member training is a great tool to help increase board members'
understanding of PWSs' operations and needs. However, getting board members to attend a
training session was a significant challenge. Kansas wanted an innovative way to increase both
attendance and engagement at board member trainings.
SOLUTIONS
The Kansas Capacity, or KanCap, Education Program (developed by the Kansas Capacity
Development Program) trains members of water district boards and city councils throughout
the state on fundamental aspects of financing and operating a water system.
As an incentive to increase board member/council attendance at these trainings, Kansas
awards PWSs one additional priority point if 80 percent or more of the PWS's board/council
attends a training session.
Additionally, PWS operators earn 5 hours of credit if the majority of that PWS's board attends a
training session.
The KanCap Education Program utilizes a handbook and an interactive CD. Board or council
members can use these tools as learning aides during the course and also as reference guides
once the training course is completed.
SUCCESS MEASURES
This educational outreach effort has been highly successful with 272 PWSs (752 people)
participating in the training to date. Of these 272 PWSs, 18 PWSs had 80 percent or more of the
board/council in attendance.
The training course is voluntary and flexible with a minimum of 12 training sessions conducted
during each state fiscal year. Learning options range from on-site discussions with technical
assistance providers to a self study option.
There is no cost for the training or the materials if participants attend either a classroom
training session or engage in on-site discussions; materials for self study are available for a fee.
Kansas is now emphasizing the number of PWS representatives that attend the voluntary
training. To date, approximately 26 percent of CWSs in the state have participated.
Page 7
-------
MARYLAND: ASSIGNING
PRIORITY POINTS FOR
WATER EFFICIENCY
Visit Maryland Water Quality Financing: Drinking Water Priority System
CHALLENGES
Municipalities across Maryland that were looking to grow often needed one thing in particular:
more water. Water must be allocated in a way that maximizes its beneficial uses and
simultaneously protects Maryland's water supply resources from mismanagement, abuse or
overuse.
Maryland has enacted a law requiring that all systems serving 10,000 or more customers have a
water conservation plan in place before they are eligible for DWSRF funding. The TMF resource
challenges faced by small systems made it impractical to extend the law to these systems.
However, the resulting benefits of this law prompted the state to consider ideas for
incentivizing and encouraging water conservation planning for small systems as well.
SOLUTIONS
The Maryland Department of the Environment (MDE) offers an incentive for small systems to
consider water conservation planning by awarding additional DWSRF priority points for water
audits and water efficiency.
A system receives five points for completing a water audit within the past year and five points
for implementing best management practices for water efficiency as identified in MDE's
guidance document Developing and Implementing a Water Conservation Plan.5
MDE aims to support projects that improve green infrastructure, water conservation and water
efficiency, as well as innovative water projects. Water efficiency projects may include the
installation of water meters or efficient water fixtures, retrofitting of fittings and equipment,
and obtaining leak detection equipment.
Maryland has several other efforts aimed at promoting water efficiency including required
water audits and Water Appropriations Permits.
SUCCESS MEASURES
MDE made a concerted effort to actively solicit water efficient projects that qualified as Green
Project Reserve projects and used a separate ranking sheet for each project to ensure that all
water efficiency projects were identified.
The law requiring water conservation planning still applies only to systems serving 10,000 or
more customers, but the state has noted that the priority point incentive has been an effective
way to start encouraging small systems to undertake valuable water conservation efforts.
In FY 2011, 28 small systems took advantage of these additional priority points: 12 systems
with water audits, three systems with water conservation plans, and 13 systems with both
water audits and water conservation plans.
5 http://www.mde.state.md.us/assets/document/water cons/wcp guidance2003.pdf
PageS
-------
KENTUCKY: ASSIGNING
PRIORITY POINTS FOR
ASSET MANAGEMENT PLANS
Visit http://water.kv.gov/Funding/Funding%20Documents/2013%20DWSRF%
20Prioritv%20Svstem%20Guidance%20Document.pdf
CHALLENGES
Kentucky found that many systems in the state did not see asset management as a necessary
activity or recognize its importance for the long-term capacity of their system.
Kentucky began offering priority points for various components of asset management on their
2011 DWSRF application although only one applicant claimed these points.
The Division of Water subsequently determined, based on other state records such as sanitary
surveys, thatof the 81 DWSRF applicants in 2011, 22 applicants did in fact have asset
management plans and could have claimed the full number of points offered. An additional 42
systems could have claimed a portion of the asset management priority points in 2011.
Kentucky recognized that one potential reason that systems did not capitalize on this
opportunity was that those filling out the applications may not have been familiar with all of the
water system's operations and particularly with its asset management activities.
SOLUTIONS
Kentucky continues to offer priority points for asset management plans and recognizes that
outreach activities may help DWSRF applicants become more aware of the opportunity to
obtain additional priority points for their asset management plans.
Systems are awarded five priority points if they have mapped their treatment, distribution, and
storage infrastructure; have analyzed their assets' conditions, including risks of failure and
expected dates of repair/replacement; and have identified sources and amounts of revenues
necessary to finance operations, maintenance and capital needs.
Systems are awarded three priority points if they have developed appropriate rate structures
that support building, operating and maintaining water system infrastructure.
Systems are also awarded five priority points if they have specifically allocated funds for
rehabilitation and replacement of aging or deteriorating infrastructure.
SUCCESS MEASURES
Kentucky considers this effort a useful learning experience to re-evaluate what would make the
state's PWSs more likely to take advantage of this valuable program in the future. For example,
Kentucky is considering whether different ways of publicizing asset management priority
points should be used during upcoming DWSRF application periods.
Other infrastructure-focused groups and state departments in Kentucky also want to promote
asset management plans and help ensure that loan applicants are aware of DWSRF benefits.
Although asset management plan priority points were not widely claimed in 2011, DWSRF
applicants did have asset management plans (or some components) in place. Further outreach
on the benefits (both DWSRF- and non-DWSRF-related) may encourage systems to strengthen
these plans and provide information about them to any individual designated to fill out a
DWSRF application for the system.
Page 9
-------
Diversifying Funding Sources
to Fund More Projects
The Model: States recognize that the needs associated with aging drinking water infrastructure
are increasing while federal and state funding sources are decreasing. Therefore it is no
surprise that states are increasing their efforts to coordinate funding with other departments
and agencies. Many states have found that this allows them to stretch limited funding dollars
and support a greater number of projects. Some states have also found that this improves their
ability to communicate with and provide assistance to PWSs and offer better overall support to
their PWSs. States have come up with many simple and innovative ways to coordinate funding,
including holding quarterly meetings to utilizing statewide pre-application forms. While states
have had to invest time to establish these coordinated activities, many have found the payback
is highly rewarding and feel that they are better able to maximize their funds and support
more high priority projects. Examples for accomplishing this are discussed below.
Figure 3: States Featured as Model 3 Examples
The states that are shaded dark blue and that include the state abbreviation represent the state examples
found in Model 3 of this document. The striped states represent the state examples found in Models 1, 2, & 4.
Page 10
-------
NEVADA: PRE-APPLICATION
FORMS FOR FUNDING REQUESTS
Visit http://ndep.nv.gov/bffwp/nwwpa.htm
CHALLENGES
Funding agencies in Nevada each had different application formats and requirements. Many
applicants, particularly small systems, reported that they were confused about what funding
sources were available and which sources were best suited for their projects.
Additionally, water systems serving 500 or fewer customers often had very few staff members
working for the system (with the exception of an operator).
Nevada also discovered that some potential recipients were seeking answers to standard
questions (e.g., "when is the application deadline?"), or submitting different descriptions of
their proposed projects (tailored to each agency's requirements), which created confusion and
discouraged cooperation among the funding agencies.
SOLUTIONS
The Nevada Water and Wastewater Review Committee (NWWRC) is comprised of
representatives from many water system funding organizations: DWSRF, State Grant Program,
United States Department of Agriculture (USDA) Loan Program, USDA Grant Program and
Community Development Block Grant (CDBG). NWWRC works collaboratively to help small
rural communities understand each funding organization and its funding application process.
NWWRC also uses a "pre-application" process to help the various agencies coordinate and
communicate about the funding sources that are most appropriate for each project This saves
significant amounts of time in the funding application stage.
NWWRC meets within 3 to 4 weeks after receiving a pre-application to make recommendations
for the most appropriate funding programs to which the applicant should apply.
SUCCESS MEASURES
Communities learn about the best funding option for their particular needs more quickly and
efficiently, and funding agencies receive applications for more appropriate projects while
having a clearer picture of the scope of applicants' projects.
The funding agencies benefit from the streamlined process because they are working together
throughout the process: from the initial request, to the engineering review and change orders,
all the way to project completion and loan repayment. This allows for considerable oversight of
the systems which benefits the systems in terms of their TMF capacity.
This collaboration also allows the funding programs to determine systems' debt capacity and
grant eligibility which allows for the most efficient use of funds.
Since 2006, NWWRC jointly funded 16 water and two wastewater projects to address arsenic
compliance, infrastructure replacements and wastewater pond lining. The major success is that
NWWRC was able to maximize and efficiently use program funding dollars to fund more
projects and provide maximum benefits to systems and their customers.
Page 11
-------
WASHINGTON: SMALL
COMMUNITIES INITIATIVE
Visit http://www.commerce.wa.gov/site/306/default.aspx
CHALLENGES
Small, rural communities in Washington often needed assistance in leveraging resources to
address system concerns because they were less likely to have the TMF capacity to effectively
comply with drinking water regulations.
Drinking water compliance issues for small, rural communities in Washington often went hand-
in-hand with economic and environmental concerns. The cumulative impact of multiple needs
for public health protection, environmental protection and economic development often
overwhelmed these small communities.
Additionally, many small, rural communities may not have had plans to address challenges such
as new regulations or source water contamination.
SOLUTIONS
Washington's Departments of Health, Commerce, and Ecology have a long history of working
together and in 1999, formalized their collaboration through the Small Communities Initiative
(SCI). Washington supports this effort using funding from the DWSRF 2 percent Small Systems
Technical Assistance Set-Aside.
Regional offices in the Departments of Health and Ecology nominate small incorporated cities
and towns, unincorporated communities, counties, utility districts and water associations that
need to upgrade their drinking water or wastewater utilities to participate in the SCI Program.
Because each community's situation is different, SCI staff typically put together both a
community team of local, elected officials and utility staff and a technical team of funding and
regulatory staff. Together, these teams develop an action plan to address compliance issues
with realistic funding scenarios.
SCI projects usually require between two to seven years to complete planning, design and
construction. SCI staff meet with communities on an as-needed basis (usually between once a
month and once a quarter), serving as facilitators, advisors and resource brokers to help the
communities identify, define and prioritize issues and thereby develop more focused projects
with strategic investment and funding opportunities.
SUCCESS MEASURES
Each community's action plan includes major milestones that are necessary to complete
improvements to their water and/or wastewater utilities. SCI staff track the number of
milestones met by each community. Examples of major milestones include completion of
planning documents, completion of environmental reviews, completion of bid documents and
the acquisition of construction funding.
Since 1999, SCI staff have assisted more than 30 small communities in securing over $120
million in state and federal funding, resulting in safer drinking water, environmental protection
and infrastructure that can serve community and economic development activities.
On average, SCI helps bring at least two communities each year into regulatory compliance with
the Health or Ecology Departments through improved water and/or wastewater utilities.
Page 12
-------
PENNSYLVANIA: UNIFORM
ENVIRONMENTAL REVIEW PROCESS
Visit http://www.rurdev.usda.gov/PA Environmental Review.html or
http://www.elibrary.dep.state.pa.us/dsweb/Get/Version-47475/381-5511-lll.pdf
CHALLENGES
The various funding agencies in Pennsylvania all required potential applicants to complete an
Environmental Review (ER), unless the project was eligible for an exclusion.
Each agency had its own guidelines for completing an ER, which was confusing for some
applicants and required applicants to complete multiple reviews if they applied for funding
from multiple agencies or decided to apply to an additional funding agency later in the process.
Staff from the Pennsylvania Infrastructure Investment Authority (PENNVEST), the state agency
that administers the DWSRF, met with staff from the U.S. Department of Agriculture - Rural
Utilities Service (RUS), the U.S. Department of Housing - Community Development Block Grant
(CDBG) program, and other funding agencies to discuss ideas for improving coordination and
supporting more projects by standardizing their ER guidelines.
SOLUTIONS
All of the state's funding agencies, with the exception of the Army Corps of Engineers, now use
the Uniform Environmental Review (UER), which was created in 2003, to standardize the
process for completing ERs of proposed drinking water and wastewater infrastructure projects.
These agencies now agree on the specific elements they require in an ER. Some of the major
elements include project description and need, summary of alternatives considered,
environmental consequences of the selected alternative, summary of mitigation, and evidence
of public participation.
Funding applicants in Pennsylvania now complete one ER that is accepted by all participating
funding agencies and does not need to be modified or rewritten if the applicant decides to apply
to another agency.
The UER is designed to complement existing planning and permitting programs by streamlining
ERs and avoiding duplication of work by multiple agencies.
SUCCESS MEASURES
The UER has been successful in reducing delays and confusion that were originally caused by
discrepancies between the various funding programs' requirements.
It is expected that each UER will be prepared to satisfy all technical documentation required by
the Pennsylvania Department of Environmental Protection for permit or planning approval.
At the outset, the UER process challenged the pre-determined boundaries for the various
agencies' responsibilities. However, these challenges were quickly overcome as agencies
reconciled the various requirements of their programs. An official from PENNVEST attributed
the agencies' ability to overcome these issues to the strong relationships that had previously
been cultivated by the regional staff of the various funding programs.
As a result of the UER creation process, agency staff better understand the mechanisms,
requirements and procedures of their counterparts in other funding agencies, which allows
them to help applicants find the most appropriate funding option for their projects.
Page 13
-------
Assisting Loan Applicants
Through Funding Workshops and
Third-Party Assistance
The Model: For some small systems, finding information about different types of funding for
drinking water system projects is only the first challenge; filling out the applications and forms
that are required to receive federal and state funding is another challenge in and of itself. Many
states have noted that there are times when the "neediest" systems do not submit loan
applications due to the complexity of completing the forms. To address this issue, many states
have hosted funding workshops or developed contracts with third-party technical assistance
providers to help systems fill out the required paperwork and understand the terms and
conditions of these grants and/or loans. Below are two examples of states that use funding
workshops or third-party assistance to help small systems learn about the funding options
they might be eligible for and then guide them through the application process.
Figure 4: States Featured as Model 4 Examples
The states that are shaded dark blue and that include the state abbreviation represent the state examples
found in Model 4 of this document. The striped states represent the state examples found in Models 1-3.
Page 14
-------
CALIFORNIA: FINANCING
COORDINATING COMMITTEE
FOR SMALL SYSTEMS
Visit http://www.cfcc.ca.gov/
CHALLENGES
Minimal communication among the funding agencies in the state created confusion for both the
state agencies and the potential borrowers.
California recognized the need for small systems to receive assistance in learning about what
funding opportunities they were eligible for and how to obtain assistance given the often
difficult and expensive task of applying for funding.
SOLUTIONS
The California Financing Coordinating Committee (CFCC), primarily formed to assist these
small, rural PWSs, has been in existence since 1998 and includes representatives from most of
the infrastructure funding sources in the stateincluding the Department of Public Health,
Department of Water Resources, United States Department of Agriculture, and Department of
Housing and Community Development. CFCC is not funded by any one agency or department,
which helps the CFCC remain a neutral party.
CFCC holds four to five funding fairs each year where the participating funding agencies present
their programs and are then available to discuss specific project plans with potential applicants.
Following the fair, a booklet of the PowerPoint presentations that were given at the fair, as well
as a booklet of information on each funding agency, is distributed to interested systems.
CFCC uses a Common Inquiry Form to assist small systems. The form is a one-page document
that is filled out by potential applicants and distributed to all CFCC members. CFCC members
are then able to respond to the potential borrowers with more information.
SUCCESS MEASURES
Approximately 400 to 500 individuals attend the CFCC funding fairs each year. CFCC has
determined that there are often many new attendees at each fair, indicating that CFCC is
effectively publicizing its available assistance.
CFCC annually assists an estimated 200 to 500 applicants. While monies of the other agencies
would still be spent in the absence of this coordinated effort, these funds might not have been
targeted to help small systems with the greatest needs.
California attributes CFCC's success to its emphasis on matching project funding to specific
applicant's needs and providing additional technical assistance to small, rural water systems.
Page 15
-------
ARIZONA: RURAL WATER
INFRASTRUCTURE COMMITTEE
Visit https://rwic.azwifa.gov/
CHALLENGES
Arizona recognized that small systems often felt overwhelmed by the complexity of funding
applications for many of the funding agencies in the state. In some cases these systems also
lacked the management expertise to set adequate rates for their system. In other cases systems
were not knowledgeable of financing options to ensure that they could cover the current and
future costs for their infrastructure.
Another major barrier for many systems, and particularly small systems, was the variability in
different agencies' funding timelines and information requirements. This created coordination
challenges for many projects that would benefit from or be infeasible without co-funding.
Arizona also noticed increased difficulty and concern for funding important projects, because of
the decrease in resources and funding available at the state level. This was particularly true for
privately-owned water systems, for which the state has even fewer available resources.
SOLUTIONS
Arizona's Water Infrastructure Finance Authority targets outreach to small rural communities
by managing the Rural Water Infrastructure Committee (RWIC), an informal partnership
comprised of representatives from various infrastructure loan and grant programs, federal and
state lending authorities and technical assistance providers.
Revived in 2005, RWIC's purpose is to serve as a "one stop" funding entity and to assist small
drinking water and wastewater systems in navigating the financial and technical assistance
programs available in the state. Communities have the opportunity to present their projects to
a number of RWIC funding partners. Together, the community and funding partners can work
to find the best possible solution to the community's infrastructure needs.
RWIC also partners with the North American Development Bank to offer annual utility manager
training through the Utility Management Institute (UMI). The UMI faculty includes water and
wastewater utility management experts from across the country. The purpose of the trainings
is to improve the managerial, financial and leadership skills necessary to successfully operate a
utility in the border region. Licensed operator attendance is encouraged and is eligible for
operator credit hours from the Arizona Department of Environmental Quality.
SUCCESS MEASURES
RWIC's members have been able to provide practical suggestions for technical, operational or
financing matters; develop possible solutions; follow up on actions or referrals; conduct
trainings, on-site visits or technical assistance; and guide systems through their next steps.
RWIC has increased its visibility in the state as an organization that provides assistance and
guidance to drinking water and wastewater utilities. For example, RWIC will be participating in
and presenting at the Rural Water Association of Arizona's annual conference this year.
While RWIC does not specifically track the outcome for projects that are proposed at RWIC
meetings, its coordinators have noted that several co-funded projects that received funding
each year started out with an RWIC inquiry.
RWIC has also received significant positive feedback on the UMI management trainings, which
typically attract 35 people per year for each intensive two and a half-day training session.
Page 16
-------
Consider These Next Steps...
Hopefully, the ideas and examples in this document have spurred some thoughts of your own
for potential funding collaboration in your state. As you reflect on these examples, consider a
couple of questions:
Are there some practical new approaches you discovered that could lead to increased
funding collaboration, effectiveness and efficiency in your program?
Which examples are the most compelling for you? Is your state similar or different?
How would you need to modify a particular approach in order for it to be successful in
your state?
Once you have some ideas you would like to try out, consider what steps you would need to
take. For example:
Who are the key decision-makers and partners you would have to enlist to implement
any new ideas you have in mind? What information would you need to provide in order
to convince them of the benefits?
What are the measures of success for your program? How would increased funding
collaboration move you closer to your goals? How would you know if it is working?
Are there some non-funding benefits that might occur from implementing funding
collaboration measures?
Page 17
-------
State/EPA Collaboration Workgroup
This document was developed with input from the State/EPA Collaboration Workgroup. The
Workgroup state members were:
ASDWA
California
Kentucky
Nevada
South Dakota
Washington
Bridget O'Grady, Association of State Drinking Water Administrators
Jim Taft, Association of State Drinking Water Administrators
George Fagella, California Department of Public Health
Kelvin Yamada, California Department of Public Health
Julia Kays, Kentucky Division of Compliance Assistance
Cindy McDonald, Kentucky Department for Environmental Protection
Reggie Lang, Nevada Division of Environmental Protection
Andrea Seifert, Nevada Division of Environmental Protection
Paul Oien, South Dakota Department of Environment and Natural
Resources
Loralei Walker, Washington State Department of Health
Additional documents developed by the Workgroup include:
Program Collaboration: Using Teamwork and Program Staff Expertise and Authority to
Assist Small Systems
Capacity Development and Operator Certification Collaboration: An Essential
Partnership to Promote Small System Capacity
Office of Water (4606M)
EPA816-F-12-007
http://water.epa.gov/drink
October 2012
------- |