vvEPA
Drinking Water State Revolving Fund
Protecting America's Public Health For 20 Years
20th Anniversary Edition
2017 Annual Report

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A Message from the Office Director
I am pleased to present the Drinking Water State Revolving Fund
2017 Annual Report, This report commemorates the DWSRF's 20th
anniversary, highlighting program accomplishments for 2017, in the
context of the outstanding public health protection achieved through
the DWSRF program over the past two decades.
fife
The DWSRF program, authorized by Congress in the 1 996
Amendments to the Safe Drinking Water Act, has become one of the
nation's most important investments in public health protection. Over
twenty years, states have signed more than $35 billion worth of loans
and other funding agreements with communities for drinking water
infrastructure. This low-cost financing saves countless dollars for
communities while expanding access to safe drinking water in homes,
schools and businesses.
The DWSRF set-asides have also played a critical role in public health protection by facilitating
the investment of over $3 billion over the program's lifespan towards operator certification,
water system capacity development and source water protection, as well as other activities that
support safe drinking water.
As we move into the program's third decade, the DWSRF will play a central role in increasing
the number of community water systems in compliance with health-based Safe Drinking Water
Act standards. The EPA will also join with states to leverage additional infrastructure funding
through the Water Infrastructure Finance and Innovation Act (WIFIA) program, U.S. Department
of Agriculture (USDA) funds and other state and private sources of infrastructure funding, to
meet the nation's growing water infrastructure needs.
We thank you for your support and dedication to public health over the past twenty years and
for your commitment to the work ahead.
Sincerely,
W1
Peter C. Grevatt, Ph.D., Director
Office of Ground Water and Drinking Water
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Contents
I.	Protecting PubDcc Health for 20 Years 4
II.	Recent Highlights 8
III.	Future DWSRF Opportunities 12
IV.	infrastructure Fund Activity 14
V.	Set-Asides Activity 16
VI.	2017 Financial Statement 20
VII.	Success Stories 24
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1995
1996
1997
DWSRF
• EPA conducts the 1st
• Congress passes Safe
• Nation's 1st DWSRF
Drinking Water
Drinking Water Act
capitalization grant

Infrastructure Needs
amendments, creating the
awarded to Georgia
Timeline
Survey
Drinking Water State
Revolving Fund
• Nation's 1st DWSRF loan


made to Williamsburg, PA
for $4.2 million
I. Protecting Public Health for 20 Years
A.	Safe Drinking Water: The Foundation of Public
Health
The health, well-being and economic vitality of our
cities, towns and rural areas depends upon safe
drinking water. Millions of Americans receive high-
quality water every day from their public water
systems. Nonetheless, the infrastructure and expertise
necessary for ensuring safe drinking water require
daily attention and cannot be taken for granted.
Congress passed the Safe Drinking Water Act
(SDWA) in 1 974 to protect America's public health
by ensuring the safety of the nation's drinking water
supply. The new law charged the U.S. Environmental
Protection Agency (EPA) with developing health-
based standards for drinking water contaminants.
States, through their public health and environmental
agencies, largely assumed primary enforcement
authority (known as primacy) for these national
standards. Water systems undertook day-to-day
responsibility for compliance.
By the early 1980s, EPA regulations under SDWA
addressed total coliform, turbidity, six synthetic
organic chemicals, ten inorganic chemicals, three
classes of radionuclides and total trihalomethanes.
The discovery of additional contaminants in drinking
water led Congress to substantially amend the
SDWA in 1986, again with an emphasis on the
development of standards, including requirements for
filtration and disinfection of surface water.
B.	The DWSRF's Establishment and First Decade
The original 1974 SDWA and its 1986 amendments
focused primarily on treatment as the means of
providing safe drinking water at the tap. In 1 996,
Congress passed additional amendments that greatly
enhanced the law by establishing a comprehensive
"source to tap" approach. The 1996 amendments
recognized water system capacity development,
operator training, funding for water system
infrastructure improvements, source water protection
and the availability of information to the public as
important components of ensuring safe drinking
water.
The Drinking Water State Revolving Fund (DWSRF)
was a major element of the 1 996 amendments. The
DWSRF was conceived to provide water systems with
loans* at below-market interest rates for
infrastructure investments needed to achieve the
SDWA's public health protection objectives. Congress
modeled the DWSRF's infrastructure financing
mechanisms on the successful Clean Water State
Revolving Fund (CWSRF) program, authorized by
amendments to the Clean Water Act in 1987. In a
significant structural modification to the CWSRF
model, Congress enabled the DWSRF to provide
funding in the form of optional set-asides that states
could use to assist water systems with developing the
technical, managerial and financial (TMF) capacity to
comply with the SDWA, as well as to carry out other
activities to protect drinking water. Congress also
made TMF capacity pre-requisite for water systems
seeking to receive infrastructure assistance through
the DWSRF.
First Decade Summary
The DWSRF began operation in 1997 and has
continued to receive annual capitalization grant funds
appropriated by Congress and awarded to states by
the EPA. Through state fiscal year 2007, the EPA
awarded the 51 state DWSRF programs (the 50
states and Puerto Rico) over $8.2 billion in federal
capitalization grants. States used these funds --
combined with state matching funds, loan repayments
and interest earnings, and optional leveraging by
some states -- to award an annual average of $1.2
billion in infrastructure assistance to water systems
during the program's first decade. In sum, state
DWSRF programs took the $8.2 billion federal
investment and leveraged it into $12.6 billion in
drinking water infrastructure investments between
1 997 and 2007.
During the DWSRF's first ten years, state drinking
water programs used the DWSRF set-asides to
*The terms loans and assistance agreements are
interchangeable.
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1998	1999
• Funds available for • EPA conducts 2nd DW
infrastructure projects Infrastructure Needs
exceed $1 billion	Survey
• 100th infrastructure project
completed
develop or strengthen their capacity development
strategies and programs, focusing on operator
certification, technical assistance, and wellhead and
source water protection. States set aside
approximately $1.3 billion of the federal
capitalization grants for these types of activities
during the program's first ten years.
C. The DWSRF's Second Decade
The Recovery Act
Responding to the Great Recession beginning in the
late 2000s, Congress passed the American Recovery
and Reinvestment Act (ARRA or Recovery Act) in
February 2009. Congress designed the ARRA to
preserve and create jobs, promote economic growth,
and invest in environmental protection and
infrastructure for long-term economic productivity.
Recognizing the nation's significant drinking water
infrastructure needs and the known efficacy of the
DWSRF program, Congress appropriated a record-
2000	2001
• 1,000th loan	• Funds available for
signed	projects exceed $5
billion
$2 billion in supplemental DWSRF funds as part of
the ARRA.
State DWSRF managers responded by funding high-
priority, ready-to-proceed water infrastructure
projects and shepherding them expeditiously to
completion. With ARRA supplemental and base
program funding combined, state programs signed
nearly 1,800 funding agreements worth $3.9 billion
for drinking water projects. For many states, this was
twice the funding they typically lent in a year,
accomplished in half the time of a typical funding
cycle.
States provided 71 percent of the ARRA DWSRF
funds as additional subsidization (grants, principal
forgiveness, or negative interest rate loans), far
exceeding Congress's 50 percent minimum
requirement. Most of the additional subsidization
went to economically disadvantaged communities.
* UCBHtRt
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2002	2003
•	Annual fund	• EPA conducts 3rd DW
disbursements exceed	Infrastructure Needs
$1 billion	Survey
•	1,000th project
completed
Congress included new provisions in the ARRA, some
of which later became permanent in the base
program:
•	Additional subsidization - As mentioned above,
Congress directed states to provide a certain
percentage of the ARRA appropriation as grant or
grant-like funds. This provision has continued in
subsequent annual program appropriations, with
some variation in the percentage.
•	Buy American - Congress introduced a domestic
procurement preference under the ARRA. In 2014,
Congress reintroduced this concept into the DWSRF
base program in the form of the American Iron and
Steel (AIS) requirement. Congress has maintained the
AIS requirement ever since.
•	Davis-Bacon wage rates - All laborers and
mechanics working on projects funded in whole or in
part by ARRA funds were required to be paid
prevailing wages as determined by the U.S.
Department of Labor. Congress made this a
permanent base program requirement in 201 2.
•	Green Project Reserve - Congress required
2004	2005
• Principal repayments	• Funds available for
and interest earnings	infrastructure projects
"revolving" back to	exceed $10 billion
state DWSRFs reach $1
billion
states to use at least 20 percent of ARRA
capitalization funds to fund water efficiency
improvements, energy efficiency improvements, green
infrastructure and environmentally innovative
activities. This provision later became optional for
state DWSRF programs.
Superstorm Sandy Response
Superstorm Sandy hit the east coast in October 201 2
and severely damaged many drinking water systems,
particularly in New Jersey and New York. Congress
passed the Disaster Relief Appropriations Act (DRAA)
in January 2013, resulting in provision to New Jersey
and New York of $38 million and $57 million in
supplemental DWSRF funds, respectively. Congress
directed these funds for DWSRF projects that reduce
water system flood damage risk and increase
systems' resiliency to withstand the effects of future
severe storms. Communities have used the funding to
install emergency standby diesel generators,
demolish and replace damaged equipment, elevate
wellheads, and construct additional storage.
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2006
2007
2008
2009
• Cumulative loans
• EPA conducts 4th DW
• States pilot the Projects
• American Recovery
signed exceed $10
Infrastructure Needs
and Benefits Reporting
and Reinvestment Act
billion
Survey
(PBR) system
(ARRA) provides $2
• EPA releases DWSRF
• 3,500th project

billion in supplemental
Program Operations
completed

DWSRF funding
Manual
• 5,000th loan signed


The WIIN Act
In December 2016, Congress passed the Water
Infrastructure Improvements for the Nation (WIIN) Act
of 2016. The WIIN Act contained the first significant
DWSRF revisions to the underlying SDWA text in the
program's twenty-year history. The WIIN Act gave
state DWSRF managers new options to calculate the
maximum amount that may be taken for the
administration and technical assistance set-aside and
eliminated the additional 1:1 match for the state
program management set-aside for capitalization
grants awarded after the Act's passage. These changes
provide state managers with additional flexibility to
craft their programs to meet the drinking water needs
of the communities within their respective states.
Flint, Michigan
Following the public health crisis in the City of Flint,
Michigan, Congress appropriated $100 million in
supplemental DWSRF funding in December 2016 for
the State of Michigan to fund projects and activities to
reduce levels of lead in drinking water in Flint. In 2017,
Michigan and the City allotted these funds for lead
service line replacements, a corrosion control study, an
asset management plan and other activities to address
the public health emergency.
DWSRF Second Decade Summary
Annual capitalization of the DWSRF continued through
the program's second decade, including the base
program funds appropriated by Congress alongside
the supplemental ARRA funds in 2009. The EPA
awarded the 51 state programs over $1 1 billion in
federal capitalization grants from the beginning of SFY
2008 through SFY 2017. Reflecting the growing,
revolving nature of the program, states awarded an
annual average of $2.3 billion in infrastructure
assistance to water systems, yielding a total investment
of $22.7 billion during the program's second decade.
States allotted approximately $1.7 billion of the
federal capitalization grants for set-aside activities
during this period.


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2010	2011
•	ARRA spurs record-high • EPA conducts 5th DW
annual loan signings:	Infrastructure Needs
1,800 loans worth $3.9 Survey
billion
•	Cumulative loans
signed hits $20 billion
II. Recent Highlights
A. America Receives its Return on Investment
Through June 30, 2017, state DWSRFs signed
approximately $35.4 billion into nearly 1 3,800 loans
to water systems to fund community water
infrastructure needs. States set aside $3.0 billion in
federal funds for their drinking water programs and
non-infrastructure support to communities during this
period.
Just last year - in state fiscal year 2017 - the
DWSRF loan program touched the lives of nearly 78
million Americans, while still providing significant
support to smaller communities; water systems serving
2012	2013
• Congress makes Davis- • Disaster Relief
Bacon wage provision	Appropriations Act
permanent for DWSRF	provides funding to NJ
projects	and NY for Superstorm
Sandy
• 10,000th loan signed
1 0,000 people or fewer accounted for 71 percent of
the loans signed by state programs in 2017.
Exhibit 1 shows the significant reach of the DWSRF
program across the country. As reported, state
DWSRFs signed loans to communities within counties
shaded in purple since 2010 (the year that states
began providing project-level data to the EPA).
The American taxpayer receives a significant return
on investment with federal capitalization grants to the
DWSRF, For each $1 drawn from the U.S. Treasury,
$1.87 of infrastructure assistance has been disbursed
to communities through the DWSRF.
Exhibit 1: Map of Counties with DWSRF Projects Reported Since March 2010
Data Source: DWSRF Database, das put 3/7/ia.
Dana includes projects that nave locacon MWmattoa
AdaitJcoa projects not nccqiceaed
Praecs ser.ing more than ore canty are nappefl
to one county. ~
No?th_Aniertca_EaiJclstant_CorifC
Map fxo&cea on 3/9)18.
EPA CW - OGWDW - DWPD.
Counties with
Reported DWSRF
Projects
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2014
2015
2016
2017
• Congress initiates
• EPA conducts 6th DW
• WIIN Act adds set-aside
• Program hits lowest
American Iron & Steel
Infrastructure Needs
flexibilities and provides
federal ULO in history:
provision for DWSRF
Survey
additional funding to
$397 million
projects
• Principal repayments
and interest earnings
• Cumulative loans signed
hits $30 billion
Flint, Ml
• Nearly 10,000 projects
completed
reach $10 billion



This return on investment will continue to increase as
states make more loans, which are later paid back
into the fund with interest. The return also increases as
states leverage additional funds through the bond
market and other sources of funding.
Exhibit 2 shows the relationship between federal
capitalization grants and loan signings by state
programs. Cumulatively through 2017, states took the
$19 billion in federal funds and, combining those
funds with other sources of fund as noted below,
signed over $35 billion in loans.
B. ULO Action Plan Stimulates Infrastructure
Investment
The EPA and state DWSRF managers share the
important fiduciary responsibility of overseeing
efficient use of federal funds. In 2014, the EPA and
states implemented an action plan focused on
reduction of federal unliquidated obligations (ULOs)
to accelerate infrastructure investment. EPA provided
specific drawdown targets for federal funds and best
practices to stimulate the flow of funds to high-
priority public health needs.
To complement the ULO action plan, the EPA
developed an eligibility handbook to provide a one-
stop-shop for states to make eligibility determinations
and to take full advantage of the flexibilities inherent
in the DWSRF program.
The state DWSRF managers embraced the
opportunity to further strengthen the DWSRF
program through implementation of the action plan.
A number of states incorporated cash flow models
and enhanced outreach to borrowers as key parts of
their programs. As a result, the DWSRF assistance
provided (execution of loans agreements) and
disbursements (reimbursements to communities for
Exhibit 2: Cumulative DWSRF Federal Capitalization and Loans Signed
$40
$35 billion in loans signed
$35
$30
$25
w) $20
O
CD $15
$10
$5
$0











$19 billion in federal capitalization grants
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
¦ Cumulative Federal Capitalization Grants ¦ Cumulative Loans Signed
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Since 2010, the DWSRF signed loans to
approximately 5,250 distinct public water systems.
incurred costs) significantly increased in 2016 and
2017 (see Exhibits 3 and 4). Disbursements include
federal dollars, state match, principal repayments,
interest earnings and funds from leveraging.
In fewer than three years, the program's federal
ULOs decreased nearly 50 percent, from $2.3 billion
in October 2013 to $1.2 billion in October 2016.
Since then, the program has continued to drive down
federal ULOs. In August 2017, the DWSRF hit the
lowest ULO in program history at about $400 million
less than one-half of an average year's
Congressional appropriation, and approximately 2%
of the total funding appropriated by Congress over
the history of the program. Delivering on the
program's promise, state programs continue to
implement best practices to maintain low ULOs into
the future.
C. DWSRF Meets Evolving Infrastructure Needs
During the program's first twelve years, more
infrastructure loan funds went to treatment projects
than to transmission and distribution projects. In recent
years, communities have increasingly looked to the
DWSRF for funding to rehabilitate and replace their
distribution systems. As a result of this shift, and as
many of these underground assets reach or surpass
their intended lifespans, transmission and distribution
projects have been the most popular project
category in six of the program's past eight years. The
2015 Drinking Water Infrastructure Needs Survey
and Assessment (DWINSA) found that transmission
and distribution represents 66 percent of the nation's
infrastructure need over the next twenty years. The
DWSRF program has demonstrated that it is well-
suited to assist communities with this need.
As the DWSRF program enters its third decade, there
are tremendous opportunities across the nation for
drinking water infrastructure investment and renewal.
The EPA's 2015 DWINSA identified $472 billion in
drinking water infrastructure investments needed
through 2034, including hundreds of thousands of
miles of pipes and thousands of treatment plants,
storage tanks and other key assets. The assessment,
conducted by the EPA in partnership with states and
water systems, shows that improvements are primarily
needed in:
•	Distribution and transmission: $312.6 billion to
replace or refurbish aging or deteriorating pipelines
•	Treatment: $83 billion to construct, expand or
rehabilitate infrastructure to reduce the presence of
contaminants
•	Storage: $47.6 billion to construct, rehabilitate or
cover water storage reservoirs
•	Source: $21.8 billion to construct or rehabilitate
intake structures, wells and spring collectors
Exhibit 3: Assistance Provided (Loans Signed)
Exhibit 4: Disbursements to Communities
$3.0
$2.5
$2.0
LD
= $L5
CQ
$1.0
$0.5
$0.0
$3.0
$2.5
$2.0
m
§ $1.5
CQ
$1.0
$0.5
$0.0
2013 2014 2015 2016 2017	2013 2014 2015 2016 2017
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DWSRF Project Highlight: Williamsburg, PA
The water utility in the Borough of Williamsburg,
Pennsylvania has served its residents and parts of
neighboring Woodbury and Catherine Townships for
more than a century. For most of that time, water was
supplied by two reservoirs located on Tussey
Mountain. In the late 1 960s, two ground water wells
were constructed to supplement the reservoirs. In the
1980s, the reservoirs were abandoned due to
Giardia contamination and the poor condition of the
transmission lines. Even after the abandonment of the
reservoirs, many of the existing mains were
undersized and in poor condition, resulting in
pressure, flow and leak problems in some areas.
After undertaking a comprehensive evaluation of its
drinking water system, the Borough applied to
PENNVEST for DWSRF infrastructure financing. The
Borough received a $4.2 million DWSRF loan in May
1997 — the first DWSRF loan in the nation. The
project included the installation of a booster pumping
station, a 21 0,000-gallon water storage tank, eight
miles of water mains and the replacement of every
water meter in the system. The project was completed
in the spring of 1998. The community recently
finished repayment of their DWSRF loan.
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III. Future DWSRF Opportunities

A. The DWSRF: A SDWA Compliance Tool
The DWSRF has been instrumental in helping the
nation's community water systems to maintain
compliance with health-based standards under the
Safe Drinking Water Act. DWSRF-funded investments
in drinking water infrastructure and capacity
development and partnership formation assistance
through state set-asides have been critical to ensure
that water systems can achieve and maintain
compliance.
State DWSRF managers, partnering with their state
Public Water System Supervision program
colleagues, utilize the program's extraordinary
flexibility to tailor assistance through the loan and set
-aside portions of the fund to address a broad array
of local needs. States are also able to use the
DWSRF to assist water systems in establishing local
and regional partnerships to support enhanced
financial, structural, operational or other
improvements and efficiencies in the reliable delivery
of safe drinking water to their customers. Water
system partnerships may be supported through the
set-asides, the infrastructure fund or both.
B. Using Data to Inform and Enhance Outreach
State DWSRF managers can make strategic use of
available data to target outreach and build
relationships with potential borrowers, the design and
construction community, and other partners. Building
these relationships is vital to the DWSRF's success in
protecting public health.
Using past loan and disbursement data, many state
managers have successfully built financial modeling
tools to predict the revolving fund's cash availability
over time. These cash flow analysis tools help state
managers effectively manage the "supply side" of
drinking water infrastructure funding sources -- that is,
plan the number and size of assistance agreements
based on the amount of money that is likely to be
available to lend for drinking water infrastructure
construction. State DWSRF managers' analyses of the
"demand" side of their programs will soon have
access to improvements that the EPA is making to the
interconnections between several drinking water-
related data systems:
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•	the DWSRF National Information Management
System (DWNIMS),
•	the DWSRF Project and Benefits Reporting System
(PBR), and
•	the Safe Drinking Water Information System
(SDWIS).
Together, these systems will provide data to assist
states and the EPA in efficiently assessing SDWA
compliance and public health protections achieved
through infrastructure funding provided to
communities by the DWSRF program. Access to
accurate, dynamic drinking water system data will
further assist state DWSRF programs in conducting
effective outreach to community water systems to
ensure that demand for funding aligns with the needs
for drinking water infrastructure investment. The new
database interconnections will also reduce reporting
burden on state DWSRF program managers and
staff.
C. Leveraging Non-Federal Funds
Increasing the amount of non-federal dollars
leveraged through the DWSRF is important to
meeting the national need to repair and modernize
aging and outdated water infrastructure. There are
two major pathways available to states to increase
the funds they have available to lend through the
DWSRF. The first involves selling tax-exempt bonds.
This has been practiced throughout the program's
history, and 22 states currently utilize this approach.
The second, and more recent opportunity involves the
EPA's Water Infrastructure Finance and Innovation Act
(WIFIA) program. Through WIFIA, states can borrow
money to help finance additional projects.
A number of state DWSRFs have also jointly financed
infrastructure projects with the WIFIA program. This
approach allows states to expand their reach on both
the demand and supply sides of their programs and
deepen customer and partner relationships.
Exploration of DWSRF and WIFIA joint ventures may
also lead to opportunities and innovations in
engaging non-federal funding sources from the public
and private spheres to help amplify and accelerate
the nation's investment in needed drinking water
infrastructure.
\P
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IV. Infrastructure Fund Activity
In state fiscal year (SFY) 2017, the DWSRF
provided $2.7 billion in assistance and entered
into 825 loans. Most of the funding went to
transmission/distribution and treatment projects
(Exhibit 5). Communities with populations of
1 0,000 or fewer accounted for 29 percent of
all assistance provided. Since 1 997, the DWSRF
has provided over $35 billion in assistance, and
71 percent of the agreements and 35 percent
of this assistance has been directed to
communities with populations of 10,000 or
fewer.
In SFY 2017, the DWSRF maintained a strong
focus on communities serving 1 0,000 or fewer
people. In terms of dollars, 29 percent of the
SFY 2017 funds administered were provided to
these smaller systems. States used principal
forgiveness as a key tool; 70 percent of
systems serving populations of 500 or less
received principal forgiveness, with 43 percent
of those systems receiving full principal
forgiveness. As the charts show, the percentage
of SFY 2017 funds directed to small systems is
somewhat less than it is for the cumulative data,
while the number of loans is similar (Exhibit 6).
Exhibit 5: Assistance by Project Type (Millions of Dollars)
SFY 2017
51,133
5155
574
5997
SFY 1997-2017
$2,053
53.66?
513,963
i Treatment
i Transmission and Distribution
1 Source
Storage
i Gtiier
Si, 12a
Exhibit 6: Assistance by Community Size
Millions of Dollars
Number of Loans
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%






$9,773

$987











$13,263






$946







$5,412

$398


$5,321
$1,594

$308
$101




SFY 1997-2017
SFY 2017
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

968

61




3,092

182





2,569

167










4,411

253







2,695

162




I > 100,000
10,001 to 100,000
13,301 to 10,000
1501 to 3,300
I <501
SFY 1997-2017
SFY 2017
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DWSRF Project Highlight: Pawtucket, Rl
The City of Pawtucket, Rhode Island, used the
DWSRF to significantly rehabilitate their aging water
system serving about 100,000 people. With a
surface water treatment plant built in 1938 and
about 200 miles of severely deteriorated distribution
mains, Pawtucket was illustrative of the challenges
facing many water systems. After years of increasing
evidence of problems, a 1987 sanitary survey
highlighted the severe water system deficiencies in
the City, in 1 992, Pawtucket had a violation of the
Total Coliform Rule (TCR), leading to a 2-month boil
water order. Pawtucket decided to address these
serious and long-standing issues, recognizing how
essential a safe and reliable water supply is to a
city's prospects for economic growth.
Pawtucket's water system rehabilitation was
extensive and included a new state-of-the-art
surface water treatment plant and over 200 miles of
cleaning and cement lining the aging cast and ductile
iron distribution network. The City worked with the
Rhode island Department of Health to secure over
$70 million in DWSRF funding, the largest loan in
state history. Pawtucket's new surface water
treatment plant went online in 2007.
The City's drinking water is now of much improved
quality. Several microbreweries have located in
Pawtucket, and the water system's electric costs have
significantly decreased due to reduced friction loss
from the smoother interior walls of the water mains
after rehabilitation. The investment will help the City
to provide safe drinking water to residents for
generations to come.
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V. Set-Asides Activity
States may reserve a portion of their annual
capitalization grants to fund non-infrastructure
activities supporting safe drinking water. Set-asides
expand the impact of the DWSRF by helping to
ensure that systems have the necessary technical,
managerial and financial capacity to get the
intended public health protection from their drinking
water infrastructure investments. Each of the four
DWSRF set-aside categories has its own connection to
public health. Upon receiving capitalization grants,
states may reserve funds under each of the four
categories, at their discretion, up to the maximum
allowable limit. Below is an overview of the set-
asides, as well as set-aside resources.
A. Overview of DWSRF Set-Asides
Administrative and Technical Assistance (approx. 4%
Set-Aside)
States may set aside the greatest amount of the
following options: 4 percent of the capitalization
grant, $400,000, or 0.2 percent of the revolving
loan fund. This set-aside is used to administer state
DWSRF programs and to provide technical assistance
to systems of any size. For example, states may use
these funds to hire staff or to assist systems with
project plans or loan applications.
Small Systems Technical Assistance (2% Set-Aside)
States may reserve up to 2 percent of their annual
capitalization grant to fund programs that provide
assistance to drinking water systems serving 1 0,000
people or fewer. Small systems often face greater
challenges than larger systems, and they frequently
have difficulty obtaining funding. This set-aside helps
them to build their capacity and align their planning
with their needs.
State Program Management (10% Set-Aside)
This set-aside may be used to fund Public Water
System Supervision (PWSS) activities overseeing all
drinking water programs in individual states.
Funding from this set-aside can be used for capacity
development, operator certification, source water
protection programs and other activities.
Local Assistance and Other State Programs (15% Set-
Aside)
States can use up to 15 percent of their
capitalization grants (but no more than 1 0 percent
for any single activity) to provide loans for the
purchase of land to support source water protection,
to implement voluntary water quality protection
activities, to carry out wellhead protection, or to
assist PWSSs with their capacity development.
B.	Set-Aside Resources
States use a range of tools and resources through the
set-asides to complement and support infrastructure
projects and build capacity at water systems. The
EPA is committed to continuing to work with the states
to identify innovative approaches that maximize the
effectiveness of investments to protect the health of
the American people.
Examples of set-aside uses are found in the Drinking
Water State Revolving Fund Eligibility Handbook (June
2017) and the Analysis of the Use of Drinking Water
State Revolving Fund Set-Asides: Building the Capacity
of Drinking Water Systems (October 2017). Set-
asides help ensure that systems have the necessary
technical, managerial and financial capacity to
achieve public health protection, which in turn allow
more water systems to successfully apply for and
receive DWSRF loans for infrastructure projects.
C.	Recent Usage
In 2017, states took more of the state program
management (10 percent) set-aside and local
assistance (15 percent) set-aside than they have
historically (Exhibit 7). This indicates a greater
reliance on the DWSRF to fund these activities.
Exhibit 8 shows how states used each set-aside
account in 2017 and cumulatively over the past
twenty years.
2017 Annual Report | 16

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Exhibit 7: Set-Asides Taken as a Percentage of Capitalization Grants
9%
8%
7%
6%
5%
3A%3.1%
0%
Admin & Technical
Assistance
Exhibit 8: Set-Aside Expenditures (Millions of Dollars)


Set-Aside Category
Sub-Category
SFY 2017
Cumulative (SFY 1997-2017)
Administrative
Administrative Assistance
31.73
615.99

Technical Assistance
0.00
3.23
Small Systems
Technical Assistance
15.38
263.94
State Program
PWSS Administration
68.12
752.87
Management
SWP Technical Assistance
2.73
96.30

Capacity Development
5.87
160.61

Operator Certification Programs
1.78
40.98
Local Assistance
Loans for SWP Land Acquisition
0.00
8.89

Loans for Incentive-Based SWP Measures
0.00
7.75

SWP Area Delineation/ Assessment
2.77
121.59

Wellhead Protection
19.84
295.18

Technical or Financial Assistance
45.01
408.33

TOTAL
193.23
2,775.66
7.7%
1.5%
Small Systems
Technical Assistance
State Program
Management
7.4%
Local Assistance
SFY 1997-2017
SFY 2017
2017 Annual Report | 17

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DWSRF Project Highlight: Santa Fe, NM
Santa Fe experienced a severe drought in the 1 990s
and experienced aquifer depletion for several years.
At the time, Santa Fe had three water sources — two
well systems and one surface water source, the Santa
Fe Reservoirs, which are solely dependent on
watershed snow melt — but the community required
a more sustainable option to meet their needs. This
led to the creation of a fourth source, the Buckman
Direct Diversion (BDD) Project. The BDD now provides
a safe, reliable fourth source of drinking water for
the City of Santa Fe and Santa Fe County by
improving the regional water supply during drought
conditions. BDD is recognized as the most state of the
art, advanced water treatment facility in the state of
New Mexico.
The BDD serves almost 100,000 people by drawing
water from the Rio Grande. This facility is the
"cornerstone" of the Santa Fe water supply, as it
provides most of the water for the City of Santa Fe
and surrounding Santa Fe County. Since the creation
of the BDD, the aquifers have recovered and two of
the wells have even become artesian. The addition of
BDD's capability to access the San Juan Chama
Project water rights gives Santa Fe the flexibility to
mix and add this water with its existing sources. The
BDD has received numerous awards since 2011,
including 201 1 LEED Certification and the 2017 New
Mexico Water and Wastewater Association
President's Award for Most Improved Facility.
Raw water from the Rio Grande is pumped 1 1 miles
uphill to the BDD water treatment plant. The raw
water undergoes a rigorous treatment process
including both conventional and advanced treatment
processes: pre-ozone treatment, coagulation,
flocculation and sedimentation, pressure membranes
for enhanced filtration, another ozone treatment for
disinfection, and granular activated carbon filters to
remove taste and odor.
The Rio Grande varies greatly in quality and
quantity throughout the year. Summer thunderstorms
increase runoff, making the river water quality
unpredictable due to higher turbidity levels with
increased volatile organic compounds and total
suspended solids.
2017 Annual Report | 18

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There are several gauge stations in the Los Alamos
canyons that monitor water flow and alert BDD
operators of any flow from these canyons into the Rio
Grande where concentrations of contaminants may
be brought down. The BDD was designed to quickly
turn off the diversion and operate the water
treatment plant from onsite storage alone if
necessary. There are 8 million gallons (MG) of raw
water storage onsite, as well as 4MG of finished
water storage, with plans to add another 4MG of
finished water storage in the future.
BDD utilizes two solar power generation facilities,
which supply a substantial amount of the energy
necessary to pump and treat the water. The BDD is
operated 24 hours a day. To maximize energy
savings, the raw water is pumped to the water
storage basins at night, when energy costs are about
one-third the price.
The DWSRF provided a $21 million loan for this
project. The remainder of the project was self-
financed by both the city of Santa Fe and Santa Fe
County, with funds raised through an annual 6
percent water rate increase over a five-year period.
There have been many economic benefits of the BDD
Project. During its two-year construction, several
hundred full-time construction workers were
employed. Currently, 35 full-time employees work at
BDD. In order to attract and retain skilled operators
and maintenance staff, these positions pay
approximately 1 0-percent higher than other similar
jobs in the area. One of Santa Fe's long-term
economic benefits is commercial growth. Previously,
businesses that were interested in moving to the area
or opening another location in Santa Fe were
concerned with water rights allocation and
availability. Because of the BDD, Santa Fe now has
an extremely reliable water source that can
accommodate residents and future business.
2017 Annual Report | 19

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VI. 2017 Financial Statement
The fundamental purpose of the DWSRF is to provide
low-cost capital to finance sustainable, long-term
public health protection. The ability to assist projects
that protect public health is dependent on three
pillars of the DWSRF:
•	continued federal capitalization,
•	innovative, intelligent and effective state
management, and
•	maintaining the growth and revolving nature of
the DWSRF.
Since the DWSRF's inception, Congress has
appropriated about $19 billion into the fund. These
funds have gone both to the revolving loan fund and
the state set-asides. Together, the 51 state DWSRF
programs have effectively leveraged these funds to
provide nearly $35 billion in loans to the nation's
water systems and $3 billion to states for set-aside
programs to support capacity development, source
water protection, and operator training and
certification. For the loan program, this translates into
$1.87 in disbursements for every $1 drawn from the
Treasury.
From the 2010 appropriation onward, Congress
mandated that a certain portion of the federal
capitalization grant be provided to borrowers as
additional subsidy. This change allows states to
further aid communities most in need and incentivize
particular types of projects.
Exhibit 9: Statement of Fund Activity (Millions of Dollars)
Annual Fund Activity
FY2016
FY2017
Federal Capitalization Grants
834.9
823.1
State Matching Funds1
159.6
255.4
Annual DWSRF Funds Newly Available for Assistance
2,106.4
2,785.1
Project Commitments (Executed Loan Agreements)
2,585.9
2,738.9
New Set-Aside Funds Available for Assistance
170.8
163.6
Project Disbursements from the Fund
2,413.8
2,582.4
Cash Draws from Federal Capitalization Grants (Fund)2
1,032.5
835.7
Cash Draws from Set-Asides2
199.4
193.4
Cumulative Fund Activity


Federal Capitalization Grants
1 8,352.4
19,175.4
State Matching Funds
3,453.5
3,708.9
DWSRF Funds Available for Assistance
34,180.2
36,965.2
Project Commitments (Executed Loan Agreements)
32,643.1
35,382.0
Set-Aside Funds Available for Assistance
2,874.0
3,037.5
Project Disbursements from the Fund
28,263.4
30,845.8
Cash Draws for Fund
15,039.2
1 5,874.9
Cash Draws for Set-Asides
2,581.1
2,774.6
Loan Principal Forgiven
208.3
306.3
^ay not equal 20% of full federal capitalization grants each year due to timing of match deposit.
2 This includes funds drawn from previous grants.
2017 Annual Report | 20

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The Single Audit Act designates the threshold for
auditing federal programs. Most DWSRF programs
receive a program-specific audit in addition to
auditing required under the Single Audit Act. Because
the 51 DWSRF programs are independent state-level
entities, DWSRF program financial reports are
prepared for individual state programs. Using the
EPA's National Information Management System,
national aggregate financial statements, best viewed
as non-audited cash flow-based reports, are shown
on the following pages.
A. Statement of Fund Activity
As shown in Exhibit 9, DWSRF programs executed
approximately $2.7 billion worth of loans in SFY
2017, a significant increase from 2016. For SFY
2017, assistance provided as a percent of funds
available ("pace of funds provided") was 96
percent, indicating that states were highly effective in
directing available funding to drinking water
infrastructure loans and other financial agreements.
Robust fund utilization demonstrates a high demand
for DWSRF funding. A portion of the disbursed funds
are used to provide principal forgiveness to
disadvantaged communities or to help finance other
specific state priorities; in SFY 2017, more than $306
million was provided in the form of principal
forgiveness.
While the size of the federal capitalization grant
decreased in 2017, the total amount of funds
available for assistance increased. The amount of
infrastructure assistance includes new investments, net
leveraged bonds, and loan principal and interest
repayments. The dollar amount of project
commitments also increased, reflecting the overall
increase in funds available.
Exhibit 10: Statement of Revenues, Expenses, and Earnings (Millions of Dollars)
Operating Revenues
FY2016
FY2017
Interest on Fund Investments
61.7
68.8
Interest on DWSRF Loans
294.2
295.5
Total Operating Revenues
355.9
364.3
Operating Expenses


Bond Interest Expense
141.9
154.1
DWSRF Funds Used for Refunding3
61.2
1.5
Amortized Bond Issuance Expense
7.1
5.0
Total Operating Expenses
270.2
160.6
Non-Operating Revenues and Expenses


Cash Draws from Federal Capitalization Grants2
1,032.5
835.7
Loan Principal Forgiven
(208.3)
(306.3)
State Contributions4
122.2
180.7
Transfers from (to) CWSRF
12.9
1.9
Total Non-Operating Revenues (Expenses)
959.3
712.0
Increase (Decrease) in Net Assets
1,105.0
915.6
Net Assets


Beginning of Year
1 5,900.4
17,005.4
End of Year
17,005.4
17,921.0
2	This includes funds drawn from previous grants.
3	Refunding occurs when outstanding bonds are retired with newly-issued bonds.
4	State contributions are not the entirety of state match, which also include state match bonds.
2017 Annual Report | 21

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Exhibit 11: Statement of Cash Flow (Millions of Dollars)
Operating Activities
FY2016
FY2017
Cash Draws from Federal Capitalization Grants2
1,032.5
835.7
State Contributions4
122.2
180.7
Loan Disbursements to be Repaid
(2,205.6)
(2,276.1)
Loan Principal Forgiven
(208.3)
(306.3)
Loan Principal Repayments
1,185.0
1,221.0
Interest Received on Loans
294.2
295.5
Total Cash Flows from Operating Activities
220.7
(49.5)
Non-Capital Financing Activities


Gross Leveraged Bond Proceeds
322.6
678.5
Bond Issuance Expense
(3.8)
(4.6)
State Match Bond Proceeds
37.4
74.8
Cash Received from Transfers with CWSRF
12.9
1.9
Interest Paid on Leveraged and State Match Bonds
(141.9)
(154.1)
DWSRF Funds Used for Refunding3
(61.2)
(1.5)
Principal Repayment of Leveraged Bonds
(419.8)
(337.0)
Principal Repayment of State Match Bonds
(45.3)
(75.0)
Total Cash Flows from Non-Capital Financing Activities
(299.2)
183.0
Investing Activities


Interest Received on Fund Investments
61.7
68.8
Deposits to Debt Service Reserve for Leveraged Bonds
51.7
15.5
Total Cash Flows from Investing Activities
7 7 3.4
84.3
Net Increase (Decrease) in Cash and Cash Equivalents
34.4
217.9
Cash and Cash Equivalents


Beginning of Year
4,708.6
4,742.9
End of Year
4,742.9
4,960.9
2	This includes funds drawn from previous grants.
3	Refunding occurs when outstanding bonds are retired with newly-issued bonds.
4	State contributions are not the entirety of state match, which also include state match bonds.
2017 Annual Report | 22

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B.	Statement of Revenues, Expenses, and Earnings
This statement is a useful tool to view the sources of
funds and the expenses of the DWSRF program
nationally, and how those impact net assets. For
2017, interest earnings exceeded expenses, adding
to the growth of the program. From 2016 to 2017,
operating expenses decreased by $49.6 million, with
a decrease in DWSRF funds used for refunding
(Exhibit 10). DWSRF net assets increased by $915.7
million, reflecting the steady increase in assets since
the program's inception.
C.	Statement of Cash Flow
This statement is a beneficial tool to view the impact
of DWSRF management activities on cash on hand.
DWSRF programs require a reserve to maintain their
programs.
As indicated in Exhibit 11, DWSRF loan
disbursements to be repaid increased by $70.5
million from 2016 to 2017, reflecting the overall
increase in project construction. Loan principal
repayments and state contributions increased, while
loan interest remained nearly constant since the
previous state fiscal year. Given the increase in loan
disbursements to be repaid, it is expected that
principal repayments will increase during upcoming
years.
State match bond proceeds increased by $37.4
million and leveraged bond proceeds added $355.9
million to program cash flows. This reflects an
increase in bond issuance in 2017. In SFY 2017,
states paid $566.1 million in principal and interest on
leveraged bonds and state match bonds,
demonstrating a decrease of $40.9 million from the
previous year. Bond issuance is one method by which
states may balance their loan demand with the need
to maintain the long-term sustainability of their
revolving funds.
D. Statement of Net Assets
Total assets increased by $1.3 billion while total
liabilities increased by $341.3 million; therefore, net
assets increased by $915.6 million, or 5.4 percent of
total 2016 net assets. This reflects the overall health
of the DWSRF program, which has shown a steady
net asset growth over the past 1 0 years (Exhibit 1 2).
Exhibit 12: Statement of Net Assets (Millions of Dollars)
Assets
FY2016
FY2017
Cash and Cash Equivalents
4,742.9
4,960.9
Debt Service Reserve - Leveraged Bonds
751.9
736.3
Loans Outstanding
15,985.0
17,040.0
Unamortized Bond Issuance Expenses4
69.3
68.8
Total Assets
21,549.1
22,806.0
Liabilities


Match Bonds Outstanding
235.1
234.9
Leveraged Bonds Outstanding
4,308.6
4,650.0
Total Liabilities
4,543.7
4,885.0
Net Assets


Federal Contributions
15,039.2
1 5,874.9
State Contributions
2,590.9
2,771.6
Transfers - Other SRF Funds
524.8
526.8
Other Net Assets5
(1,149.6)
(1,252.3)
Total Net Assets
17,005.4
17,921.0
Total Liabilities & Net Assets
21,549.1
22,806.0
5	Unamortized bond issuance expenses are costs that have been incurred but have not been fully recognized (amortized). These costs
will be recognized (amortized) over time over the remaining life of the bonds outstanding, similar to a pre-paid expense.
6	Examples include interest, loan repayments, principal forgiveness.
2017 Annual Report | 23

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VII. Success Stories
Region 1
Ashland, ME — Ashland had
a storage tank coated with
lead-based paint and a
collapsing roof. With a
median household income
(MHI) under $14,000 per
year, Ashland qualified for
disadvantaged assistance and
used DWSRF and Maine Rural
Development Council funding
to make improvements.
Mattapoisett River Valley Water
District, MA — The District
struggled with iron and
manganese contamination issues
and received funding from the
DWSRF 2 percent set-aside to
plan a water treatment facility.
This new facility allowed four
towns to regain use of their
existing sources and avoid having
to develop a new source.
Waterville Fire District, VT —A
DWSRF loan was used to build
two reservoirs, replace water
mains, and construct a building
for housing equipment and
meters. These system upgrades
corrected issues with
inadequate disinfection
capacity, which had led to
bacterial contamination of the
water supply.
Region 2
New York — The State of
New York uses the state
program management (10
percent) set-aside to conduct
security inspections at drinking
water systems to ensure that
facilities and operations are
not vulnerable to threats that
could disrupt the delivery of
safe drinking water to their
customers.
Rosemont Water Company, NJ
— The Rosemont Water Company
was formed in the 1960s by
community members in the village
of Rosemont to address unsafe
drinking water. In 2007, the
system had unsafe arsenic levels,
and the RWC worked with the NJ
DWSRF program to install an
arsenic removal system and
provide safe drinking water to
residents.
Puerto Rico — Puerto Rico
used DWSRF set-aside funds
to develop a Capacity
Development Pilot Project
aimed at small communities.
This project, carried out in
fifteen communities around the
island, measured the
effectiveness of the circuit
riders approach to help small
community systems achieve
and maintain TMF capacity.
2017 Annual Report | 24

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Region 3
Forest Park Mobile Home
Park, DE — Forest Park had
several violations, including
high nitrate levels.
Collaboration between
several agencies and use of
the DWSRF 15 percent set-
aside funding brought this
small system into compliance
and provided safe drinking
water to Forest Park's 46
residents.
Baltimore, MD — In order to
comply with the Long Term 2
Enhanced Surface Water
Treatment Rule, the City of
Baltimore replaced an existing
open finished water reservoir
with a new enclosed 35 MG
reservoir. To improve runoff water
quality and reduce runoff volume,
the new reservoir was covered
with a green roof.
Eastern Wyoming Public
Service District, WV — Eleven
failing and abandoned water
systems were consolidated to
form the Eastern Wyoming
PSD, with a new water plant,
three storage tanks and new
water mains. This project used
several funding sources,
including the DWSRF, to bring
safe, potable water to
residents.
Region 4
Stuart, FL — Stuart upgraded
its water distribution system
by replacing over 1 1 miles of
pipes, as well as replacing
approximately 2,500 meters
throughout the city. Stuart also
completed an emergency
interconnect with a nearby
water source, allowing the city
to provide safe, reliable
water to customers.
Pascagoula, MS — Saltwater
intrusion and overall low water
quality led Pascagoula to use
DWSRF funding for construction of
three reverse osmosis/ozone
treatment plants to treat water
from 12 wells. This project
improved water quality and
resolved customer complaints
regarding the water's taste, odor
and color.
Dauphin Island Water and
Sewer Authority, AL —
Organic matter contamination
created hydrogen sulfide gas
that corroded Dauphin Island's
water storage tank. With
ARRA funding, Dauphin Island
constructed a new water
storage tank, with a protective
coating and ventilation for
gases, and a treatment plant
to remove contaminants.
2017 Annual Report | 25

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Region 5
Dexter, Ml — The Village of
Dexter used ARRA funding to
replace over 4,000 feet of
old cast iron water mains. This
project qualified for Green
Project Reserve funding due to
water loss reduction and
corresponding energy savings.
The system previously had
around 17 percent real water
losses.
Lanesboro, MN — Struggling
with iron, manganese, and radium
contamination issues, Lanesboro
received DWSRF funding to drill a
new groundwater well and
construct a new water treatment
plant. Lanesboro returned to
compliance in 2016 and has
noticed significantly improved
water quality.
Wisconsin — The Wisconsin
DWSRF program provides loan
principal forgiveness for
replacement of privately-owned
lead service lines (LSL). The
municipality's population size
determines the maximum funding
level for LSL replacement.
Funding is also available for the
private portion of LSL
replacement at K-l 2 schools and
licensed daycare centers.
Region 6
Saint Bernard Parish
Waterworks, LA — A rare,
deadly amoeba was found in
St. Bernard's cast iron water
mains. This project began in
2015 and involved replacing
the cast iron waterlines with
polyvinyl chloride (PVC) pipe,
which will eliminate leaks and
water main failures.
Garber Municipal Authority, OK
— Garber MA, a city of 845
people, owned two wells that
exceeded the health-based
standards for nitrates and carbon
tetrachloride. This city received
DWSRF funding to install 1 1 miles
of water mains, build a pump
station and successfully
consolidate with the nearby town
of Enid. This project was
completed in 2017.
2017 Annual Report | 26
Franklin Sebastian Public
Water Authority, AR — Three
separate communities were
having contamination issues and
had a limited drinking water
supply. These communities used
DWSRF funding to create the
Franklin Sebastian PWA. This
new regional entity purchases
safe drinking water from Fort
Smith and transports it to these
communities.

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Region 7
Ames, IA — A 90-year old
treatment plant was replaced
by a 15 million gallon-per-
day, Leadership in Energy
and Environmental Design
(LEED)-certified facility that
meets the demand of 59,000
residents. This project was
completed in 2017, and the
$76 million loan for this
project was the largest loan in
IA DWSRF history.
Hutchinson, KS — Several city
wells were contaminated with
volatile organic compounds
(VOCs,) so the city air-stripped
the VOCs and discharged the
waste into a nearby stream.
When the state required
elimination of the discharge,
Hutchinson utilized both the
DWSRF and CWSRF to build a
new water treatment plant and
improve local water quality.
Jackson, NE — Jackson, a
community of 230 people,
needed to meet health-based
standards for radium and
gross alpha particles. To do
this, they received DWSRF
funding to install a new well in
a different aquifer, build a
new water treatment plant for
iron removal and make
needed improvements to the
distribution system.
Region 8
Sterling, CO — A new reverse
osmosis water treatment plant
was constructed to address
uranium and total
trihalomethane (TTHM)
violations. This project,
completed in 2013, enabled
Sterling to comply with
drinking water standards and
provide safe drinking water
to residents.
South Wind Water District, MT —
After years of non-compliance,
200 residents purchased the
system and formed the South
Wind WD. The community has
since implemented several
improvements to the system,
including a new well, well house,
storage tank and water mains.
Future projects will address
leaking water mains.
Afton, WY — Afton and its
electricity provider developed
a micro-hydroelectric system
(inline pipe turbine) designed
to generate over six times the
amount of energy used by
Afton's water system. Excess
electricity is sold, generating
revenue for Afton. Also, the
use of renewable energy
reduces Afton's carbon
emissions.
2017 Annual Report | 27

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Region 9
Eastern and Elsinore
Municipal Water Districts, CA
— Nitrate contamination and
TMF capacity issues led a
small, privately-owned system
to consolidate with Eastern
and Elsinore MWD. Thirty-two
(32) connections were joined
with Eastern MWD and 120
connections with Elsinore
MWD.
Mobile Home Park, NV — A
mobile home park with 30
customers was out of compliance
with health-based requirements
for arsenic and coliform.
Collaboration among several
agencies allowed this MHP to
successfully consolidate with the
county and receive safe drinking
water. This project was completed
in 2017.
Lake Verde Water Company,
AZ — Lake Verde Water
Company, serving 125
people, received DWSRF
funding to construct a
centralized arsenic treatment
system and three 10,000-
gallon storage tanks. This
project, completed in 2017,
brought the system into
compliance with the arsenic
rule.
Region 10
Palmer, AK — Water mains
throughout the city were
corroded, causing water
leakage and allowing debris
to contaminate the drinking
water. Palmer received
DWSRF funding to replace
25,000 feet of the corroded
steel water mains.
Baker City, OR — A 2013
Cryptosporidium outbreak
sickened hundreds of residents
and forced Baker City to quickly
find a solution. Ultraviolet (UV)
treatment was fully installed in
2015 as a low-cost, beneficial
option for the city to reduce future
potential outbreaks and provide
safe drinking water to residents.
Central Shoshone County
Water District, ID — The
District's well was under the
direct influence of surface
water, putting it at risk for
microbial contaminants. A
membrane microf iltration
water treatment plant was
constructed to meet standards
and provide safe drinking
water to residents.
2017 Annual Report | 28

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State Agencies Managing the DWSRF
EPA Region 1	EPA Region 4
Connecticut Department of Public Health	Alabama Department of Environmental Management
Connecticut Office of the Treasurer	Florida Department of Environmental Protection
Maine Department of Human Services	Georgia Environmental Finance Authority
Maine Municipal Bond Bank	Georgia Department of Natural Resources
Massachusetts Clean Water Trust	Kentucky Infrastructure Authority
Massachusetts Department of Environmental Protection	Kentucky Department of Environmental Protection
Massachusetts Executive Office of Administration and Finance	Mississippi State Department of Health
New Hampshire Department of Environmental Services
Rhode Island Infrastructure Bank
Rhode Island Department of Health
Vermont Facilities Engineering Division
EPA Region 2
New Jersey Department of Environmental Protection
New Jersey Environmental Infrastructure Trust
New York State Department of Health
New York State Environmental Facilities Corporation
Puerto Rico Department of Health
Puerto Rico Infrastructure Financing Authority
EPA Region 3
Delaware Department of Health and Social Services
Maryland Water Quality Financing Administration
Maryland Water and Science Administration
Maryland Department of the Environment
Pennsylvania Infrastructure Investment Authority
Pennsylvania Department of Environmental Protection
Virginia Department of Health
Virginia Resources Authority
West Virginia Department of Health and Human Resources
West Virginia Water Development Authority
North Carolina Department of Environmental Quality
South Carolina Department of Health and Environmental
Control
South Carolina Budget and Control Board
Tennessee Department of Environment and Conservation
EPA Region 5
Illinois Environmental Protection Agency
Indiana Finance Authority
Michigan Department of Environmental Quality
Michigan Municipal Finance Authority
Minnesota Public Facilities Authority
Minnesota Department of Health
Ohio Environmental Protection Agency
Ohio Water Development Authority
Wisconsin Department of Natural Resources
Wisconsin Department of Administration
2017 Annual Report | 29

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EPA Region 6
Arkansas Natural Resources Commission
Arkansas Department of Health
Arkansas Development Finance Authority
Louisiana Department of Health
New Mexico Finance Authority
New Mexico Environment Department
Oklahoma Department of Environmental Quality
Oklahoma Water Resources Board
Texas Water Development Board
EPA Region 7
Iowa Department of Natural Resources
Iowa Finance Authority
Kansas Department of Health and Environment
Kansas Department of Administration
Kansas Development Finance Authority
Missouri Department of Natural Resources
Missouri Environmental Improvement and Energy
Resources Authority
EPA Region 8
Colorado Water Resources and Power Development Authority
Colorado Water Quality Control Division
Colorado Department of Local Affairs
Montana Department of Environmental Quality
Montana Department of Natural Resources and Conservation
North Dakota Department of Health
North Dakota Public Finance Authority
South Dakota Department of Environment and Natural Resources
Utah Department of Environmental Quality
Wyoming Office of State Lands and Investments
Wyoming Department of Environmental Quality
Wyoming Water Development Office
EPA Region 9
Arizona Water Infrastructure Finance Authority
California State Water Resources Control Board
Hawaii Department of Health
Nevada Division of Environmental Protection
Nevada Office of Financial Assistance
EPA Region 10
Alaska Department of Environmental Conservation
Idaho Department of Environmental Quality
Oregon Health Authority
Oregon Infrastructure Finance Authority, Business Oregon
Oregon Department of Environmental Quality
Washington State Department of Health
Washington Department of Commerce
2017 Annual Report | 30

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2017 Annual Report | 31

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DWSRF At-a-Glance
Assistance Provided for Projects (Millions of Dollars)

2017
1997-2017
Total, by Project Type
2,738.9
35,384.7
Planning and Design Only
28.3
367.6
Construction


Treatment
997.3
13,712.6
Transmission & Distribution
1,190.4
1 3,967.7
Source
154.6
2,053.3
Storage
275.0
3,669.3
Purchase of Systems
0.7
293.6
Restructuring
17.0
11 5.7
Land Acquisitions
1.9
81.0
Other
73.7
1,123.9
Total, by Population Served


Less than 501
100.5
1,594.4
501 to 3,300
307.7
5,321.4
3,301 to 10,000
397.6
5,41 1.8
10,001 to 100,000
946.1
13,263.1
100,001 and Above
987.0
9,772.6
# of Loans, by Population Served


Less than 501
162
2,695
501 to 3,300
253
4,411
3,301 to 10,000
167
2,569
10,001 to 100,000
182
3,092
100,001 and Above
61
968
Funds Available for Projects (Millions of Dollars)

2017
1997-2017
Total Funds
2,785.1
36,965.2
Federal Capitalization Grants
823.1
19,175.4
State Match
255.4
3,708.4
Net Leveraged Bonds
848.9
7,908.1
Net Loan Principal
Repayments
884.0
6,840.3
Net Interest Earnings
135.3
2,002.8
Net Transfers with CWSRF
1.9
367.3
Less Set-Asides


Other Key Statistics:
•	In 2017, every $1 in federal appropriation to
DWSRF programs resulted in jajPSMdisbursed.
•	The DWSRF average interest rate in 2017 was
| , compared to 3.3% market-value interest
rate. This lower interest rate results in over 13
J in savings to local community ratepayers
over the life of these loans.
•	States also awarded	principal
forgiveness to communities in 201 7. These grant-
like funds help keep water rates affordable for
communities.
•	states sell bonds in order to further leverage
their DWSRF programs.
For more information about the Drinking Water
State Revolving Fund, please contact us at:
Drinking Water State Revolving Fund Program
U.S. Environmental Protection Agency
1201 Constitution Avenue, NW (Mail code 4606M)
Washington, DC 20460
Internet: www.epa.gov/drinkingwatersrf
Office of Ground Water and Drinking Water
August 2018
EPA 810-K-18001

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