Funding Resilient Infrastructure and Communities with
the Clean Water State Revolving Fund

Variable weather events arid natural disruptions, including floods, droughts, tornadoes, wildfires, and
hurricanes, have adversely impacted communities across the United States in recent years. These events
underscore the need for communities to build infrastructure and manage resources that can maintain
performance when impacted by such disruptions. Today's infrastructure challenges include not only needs
for repair, upgrade, and replacement, but also ensuring infrastructure assets and communities are resilient to
variable weather events.
How the CWSRFs Work
The Clean Water State Revolving Fund (CWSRF) is a low-
interest source of financing for a wide range of wastewater
infrastructure and water quality projects. The program is an
effective partnership between EPA and the states as well as
the territory of Puerto Rico. Each program has the flexibility to
fund a variety of projects that address the most pressing water
quality needs. The state- and territory-administered programs
each operate like banks with federal and state contributions
used to capitalize the programs. These funds are used to make
low-interest loans to local communities for water quality
projects and are then repaid to the CWSRFs over terms as long
as 30 years or the useful life of the project, whichever is less1.
Repayments are then recycled back into the fund to finance
additional projects. The below-market rate loans offered by the
program save borrowers significant resources over the life of
the loan compared to traditional financing sources.
Financial Benefits of CWSRF Funding
CWSRF assistance options deliver significant
benefits and incentives to borrowers. CWSRF
loans can provide the following benefits:
	Coverage of up to 100% of project costs;
	Discounted loans below the market rate
down to zero percent in some states;
	Deferred payments of principal and/or
interest;
	Terms of up to 30 years and extended term
financing that reduces annual interest
payments;
	Dedicated revenues for loan repayments
that can come from any source;
	Reliable access to capital through the use of
programmatic, portfolio, and co-financing;
	Access to additional subsidies;
	Credit enhancements that lower the cost of
borrowing for less than AAA green debt
obligations; and
	Access to affordable assistance for project
development, planning, and technical
assistance.
Getting A Project Funded
EPA encourages states to consider funding a wide variety of
eligible water quality and public health projects based on a
state's specific needs. Utilities and municipalities that want to
learn more about CWSRF funding opportunities should seek out their state's CWSRF program to learn more
about the process states use to determine which projects are funded. A directory of CWSRF state programs can
be found at https://www.epa.gov/cwsrf.
Assistance for Resiliency Projects
The CWSRFs can provide assistance for a wide range of eligible activities that can help communities become
more resilient to natural disasters and extreme weather events. These resiliency features, such as energy and
water efficiency upgrades, and stormwater management are often incorporated into a larger project that can
strengthen and protect water infrastructure. Resiliency projects:
	Prevent interruption of collection system operations in the event of a flood or natural disaster;
	Maintain the operation of a treatment works and the integrity of the treatment train in the event of a flood
or natural disaster;
	Preserve and protect treatment works in the event of a flood or natural disaster;
	Enhance community resilience through stormwater management using both green and grey infrastructure in
the event of a flood; or
	Secure and conserve local water supplies through water reuse and conservation in the event of a drought.
1 When appropriate, the CWSRFs can provide extended term financing beyond 30 years by purchasing or refinancing municipal debt
obligations.

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States can also provide assistance to assess treatment works' vulnerability to extreme weather or analyze the
best approach to integrate system and community resiliency priorities, as iong as the work is reasonably
expected to result in a capital project. Examples include water/energy audits, asset management plans, and
drought management plans. These efforts help analyze infrastructure needs and can result in a pipeline of
sustainable projects that are eligible for CWSRF funding.
Encouraging Resilient Infrastructure
Priority-setting systems are an effective too! that states
use to encourage resilient wastewater and stormwater
infrastructure. Each CWSRF program has a unique
priority setting system that evaluates and ranks
projects. Ranking criteria primarily focus on public
health and water quality but can also address other
concerns, such as infrastructure resiliency. States can
encourage more projects that promote system
resiliency through targeted ranking criteria
(e.g., offering priority points) and funding incentives
(e.g., reduced interest rates and/or waiving fees).
Additional subsidies (e.g., principal forgiveness,
negative interest rate ioans, and grants) can be used
to encourage resiliency projects. CWSRF programs can
also use their administrative resources to provide
technical assistance and training in the development
of resiliency projects. Additionally, many states use
various marketing strategies to share information with
prospective borrowers.
Memorandum of Understanding (MOU)
between EPA and the
Federal Emergency Management Agency (FEMA)
On June 4, 2019, EPA and FEMA announced an MOU2 that
establishes a framework for EPA-funded SRF programs to
assist and collaborate with FEMA disaster assistance grant
programs. The SRFs work cooperatively with FEMA and
state, local, tribal, and territorial governments to allow
local entities to quickly recover and restore their vital
infrastructure after a Presidentially declared disaster. The
proposed activities in the MOU streamline coordination
between FEMA and the SRFs to enable funding to be
made available as quickly as possible to support essential
infrastructure projects. Communities will no longer have to
expend their own funds first and wait for a reimbursement
through a FEMA grant and/or supplemental funds from
Congress. By having this MOU in place, communities will
have the resources available to not oniy save time and
lower costs, but also have access to the necessary tools
that can help increase their resiliency to future disasters.
Drought Resiliency and the CWSRF
The duration and impact of drought vary across areas of
the United States and can lead to widespread water
shortages, wildfires, and crop and livestock losses. The
economic impact of these events is felt both regionally
and nationally, but even more so in the communities
directly affected.
The CWSRFs provide financial assistance for a broad range
of eligible water infrastructure projects to assist
communities' efforts to become drought resilient.
However, such projects do not need to be soiely designed
to mitigate drought and can have other tangible benefits.
Drought resiliency projects may also better position
utilities and their customers to conserve and use water
resources more efficiently to reduce costs.
2A copy of this MOU can be viewed at https://www.epa.gov/cwsrf/memorandurn-understanding-between-erivironmental-protection-
agencv-and-department-homeland
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In 2018, EPA's Water Infrastructure and Resiliency Finance Center developed a report entitled State Revolving
Funds: Financing Drought Resilient Water Infrastructure Projects. This report focused on how 13 drought-
prone states used the CWSRF to support drought resilient infrastructure investment through innovative
funding policies and programmatic actions, as well as other incentives, state requirements, and technical
assistance. For example:
California
The California State Water Resources
Control Board CWSRF supports the
three goals of the California Water
Action Plan: more reliable water
supplies; the restoration of important
species and habitat; and a more
resilient, sustainably managed water
resources system that can better withstand '
inevitable and unforeseen pressures in the
coming decades.
Colorado
The Colorado CWSRF has five sections
in their priority setting system including
sustainability/Green Project Reserve
(GPR), Examples include projects that
incorporate GPR components at a
minimum of 20% of total project costs;
projects that implement a source water protection
plan; and planning and design grants where projects
will generate and/or utilize reclaimed water for direct
reuse or correct a water loss issue.
Oklahoma		
The Oklahoma Water
Resources Board developed
the Oklahoma Drought Tool
for communities and planners
in collaboration with the U.S.
Bureau of Reclamation. The tool outlines drought
management concepts, planning options,
and other resources.
Texas			
The Texas CWSRF requires applicants j (
to have a water conservation 		j
and drought continency plan for
loans greater than $500,000. Water
conservation plans include targets and
goals for efficiency, reuse, and other options.
For more information and a full version of this report, please visit https://www.epa.gov/waterfinancecenter/
state-revolving-funds-financing-drought-resilient-water-infra structure-projects
Clean Water Success Stories
Lessons Learned From Hurricane Sandy &
New York's Storm Mitigation Loan Program
Superstorm Sandy, the deadliest and costliest storm of the
2012 hurricane season, highlighted the vulnerability of
heavily populated communities and the need for resiliency
strategies for extreme weather events and associated
coastal flooding. Storms, flooding, and rapid sea level rise
can impact resources and infrastructure in low lying areas
including roads, public access points, and sewer and water
mains.
In the aftermath of Superstorm Sandy, the U.S. Congress
appropriated $600 million in SRF funds for New York and
Damage along seaside areas of Brooklyn, NY
after Hurricane Sandy.
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New Jersey to reduce flood damage risk arid vulnerability,
or to enhance resilience to rapid hydrologic change or
a natural disaster at a publicly owned treatment works
(POTW). The New York Environmental Facilities Corporation
(NYEFC) used their funds to create the Storm Mitigation
Loan Program (SMLP) for Clean Water SRF projects. $339.7
million in CWSRF funds were made available to provide
financial assistance in the form of zero-interest loans and
grants for storm resilience and mitigation projects. These
projects included flood-proofing critical treatment systems,
correcting significant problems to reduce the likelihood
of sewer backups or flooding of a treatment facility, and
upgrading and hardening pump stations to ensure peak
flow capacity during a storm event. The SMLP promotes
the use of sustainable practices in the design and
construction of water quality infrastructure to reduce the
risk to water systems from future storms and other natural disasters in the 14 counties affected by Sandy.
Today, the NYEFC continues to work with communities to fund resilience and mitigation projects by offering
additional subsidization in the form of grants, as well as low- or no-interest loans. In addition, if there is a
project that needs funding over and above what was originally planned, the CWSRF may be able to provide
that assistance. For more information on this program, visit http://www.efc.nv.gov/CWSRF
Southern Monmouth Regional Sewerage Authority Station Resiliency Upgrades
The South Monmouth Regional Sewerage Authority
(SMRSA) in New Jersey operates a wastewater treatment
plant and conveyance system serving several coastal
communities that have recently experienced extreme
weather events. SRF funds provided short-term financing
to SMRSA through the NJ Water Bank's Statewide
Assistance Infrastructure Loan (SAIL) Program as an
advance for FEMA assistance to build three pump stations,
saving the community an estimated $1.9 million in short
and long-term interest costs.
SMLP to upgrade a pump station in Suffolk
County, NY to prevent future flooding.
Photo Courtesy of the
Environmental Council of the States.
Two of these pump stations are fully operational mobile	^
units that can be disconnected during a severe storm and	Photo Courtesy of New Jersey Department
transported to a safe location. Once the storm subsides,
the mobile stations are returned and reconnected. These
mobile resilient pump stations (MRPS) contain main electrical components, computer equipment, and an
emergency generator - all located on a mobile trailer at the original pump station site. Older pump stations
in coastal areas were seriously damaged in recent years, costing millions of dollars to repair and leaving
communities without wastewater services.
The new MRPS limit the disruption in conveyance, minimize sewer overflows, and will save SMRSA millions of
dollars by preventing damage from future storms. The third pump station replaced an older station that was
in a 100-year flood zone. This new pump station is a permanent fixture designed to look like the neighboring
residential housing and was placed outside the floodplain.
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Wellington Avenue Combined Sewage Overflow
Treatment Facility Upgrades
Since 1978, the Wellington Avenue Combined Sewage
Overflow Treatment Facility (WACSOTF) in Newport,
Rhode Island has reduced the number of Combined
Sewer Overflows (CSOs) that would otherwise discharge
into the Newport Harbor, WACSOTF is situated at a
location that is vulnerable to flooding, and a National
Oceanic and Atmospheric Administration tide gauge at
the location has documented nearly a one-foot rise in
sea level since 1930. Although elevated, the first floor
of the WACSOTF is predicted to be a foot under water
in a 100-year flood event. To mitigate these risks, the Cit
of Newport received a $5.4 million CWSRF loan with an
interest rate of 2.16 percent from the Rhode Island Infrastructure Bank to upgrade and fortify WACSOTF.
These upgrades added flood protection and station resiliency from threats of rising sea levels; increased
the capacity of the sanitary pumps and force main to eliminate CSOs; added capacity and automation
improvements to the chlorination system; performed a feasibility assessment for incorporating dechlorination
as an interim measure; and made improvements to ancillary electrical, mechanical, and HVAC systems critical
for increased reliability, worker safety, and energy efficiency.
Oklahoma Water Resources Board
Atoka Reservoir Dam Rehabilitation
Photo Courtesy of Rhode Island Department of
Environmental Management
The Atoka Reservoir is a source of drinking water for the
residents of Oklahoma City. Past flooding damaged the
reservoir's dam and spillway, creating safety concerns for
the City's pump stations and transmission lines. These
critical water system components ensure that the water
is delivered to approximately 1.2 million people within
the city and surronding communities. During high rain
events and flooding, the population served by this water
system was vulnerable to losing a critical public service.
In addition, the flood storage capacity of the reservoir and
discharge capacity of the spillway were limited. The City
responded to this concern by financing $34 million through the CWSRF for the repair of the spillway and
to increase the height of the reservoir embankment to allow for greater flood storage capacity. Improved
flood resilience allows the reservoir to hold more stormwater, which reduces sediment and nutrients from
flowing into the neighboring North Boggy Creek. Overall, these repairs reduce the risk of a dam breach while
improving the water quality of the creek which is on Oklahoma's 303(d) Impaired Waters List.
Photo Courtesy of Oklahoma
Water Resources Board
The Clean Water State Revolving Fund Branch
United States Environmental Protection Agency
Office of Water, Office of Wastewater Management
1200 Pennsylvania Avenue, NW (Mailcode 4204M)
Washington, DC 20460
EPA Publication 816R21003
January 2021
https://www.epa.gov/cwsrf

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