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Office of Water (4606M)
EPA 816-F-22-003
February 2022


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Water System Partnerships - Getting Started

Contents

Introduction	1

Identifying Projects	3

Step 1. Identify your water system's strengths and challenges	3

Step 2. Identify opportunities to address challenges or build off strengths	3

Step 3. Identify assistance with project development	4

Identifying Partners	5

Step 1. Research and meet nearby water systems	5

Step 2. Start conversations with water systems about partnering	5

Identifying Funding Sources	6

Step 1. Conduct desktop research	6

Step 2. Compile a list of eligible funding sources	6

Step 3. Reach out to points of contacts	6

Step 4. Narrow list of funding resources	6

Applying for Funding	7

Step 1. Prepare for funding	7

Step 2. Consult with the team on outstanding items	7

Step 3. Set tasks and deadlines	8

Step 4. Submit application	8

Next Steps	8


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Water System Partnerships - Getting Started

Introduction

As a follow-up resource to EPA's Water System Partnerships Workshop and as a companion to Water
System Partnerships Funding Resources, this document provides a general approach for water systems
to assess their current stage in the water system partnerships planning process, understand their next
steps, be prepared for funding, and learn how to apply for funding. The steps listed below are provided
to help a water system get started in the planning process and are not all encompassing. Water systems
may want to consider taking additional actions, before getting started, to gain a more complete
understanding of their specific needs or regional issues that water system partnerships could help solve.
These actions could include meeting with leaders at their water system to discuss their water system's
strengths and challenges, and meeting with neighboring water systems to compare strengths and
challenges. Refer to EPA's Water System Partnerships Handbook for more information on identifying
problems and partners.

At any stage in the partnerships process, your state or local coordinators could be helpful resources.
Reaching out to state or local regulatory drinking water program coordinators at this particular stage can
be especially helpful to:

	Provide guidance on partnering

	Provide project support, including funding for technical assistance

	Be a neutral third party, helping to facilitate discussions and decision-making

	Help with planning and consideration of alternative options

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Water System Partnerships - Getting Started

Do you have a
project in mind?

Determine where you are in
the planning process

Click the four orange buttons below for more
information about each step in the planning process.

No

Yes

I

Identifying projects

r

1.	Identify your water
system's strengths and
challenges

2.	Identify opportunities
to address challenges
or build off strengths

3.	Identify assistance with
^ project development	J

Do you have a
partner in mind?

No

Yes

Identifying partners

1.	Research and meet
nearby water systems

2.	Start conversation with
water systems about
partnering

f

Have you identified a
target funding source?

No

Yes

f

f

( ]
Identifying funding sources



Applying for funding



1.	Conduct desktop research

2.	Compile a list of eligible
funding sources

3.	Reach out to POCs

4.	Narrow list of funding
. resources



1.	Prepare for funding

2.	Consult with the team on
outstanding items

3.	Set tasks and deadlines

4.	Submit application

^ J

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Water System Partnerships - Getting Started

Identifying Projects

An important first step to forming a successful water system partnership is identifying the appropriate
project. If you're interested in participating in a water system partnership, here are a few steps to help
you identify a potential project.

Step 1. Identify your water system's strengths and challenges

Understanding your water system's strengths and weaknesses will help you identify partnership
opportunities that best address your needs and provide value to potential partners. One way to assess
your water system is to conduct a strengths, weaknesses, opportunities, and threats (SWOT) analysis of
your water system. See the figure below for example questions to consider when determining your
water systems strengths and weaknesses (left side). Then, depending on your answers, consider the
example opportunities and threats listed on the right. Identify opportunities for each of your strengths,
and threats for each of your weaknesses.

System Strengths
What we do well.

- Is your system growing?

Do you have a growing customer user base?

- Is there another dedicated revenue
structure supporting your utility?

Example
SWOT Analysis

System Weaknesses
What we struggle with.

-	Do your operators have limited capacity?
Any difficulties with regulatory compliance?

-	Is revenue from current users inadequate

for financing operators?

System Opportunities
What we could build on.

- Information sharing

- Bulk purchasing

- Building interconnections

- Acquisitions

	 System Threats

What puts us at risk.

Delays in preventative maintenance

- Poor water quality

- Emerging contaminants

- Bankruptcy

Step 2. Identify opportunities to address challenges or build off strengths

Water system partnerships can be generally categorized into four types: informal cooperation,
contractual assistance, joint power agency, and ownership transfer. There are many different variations
of each water system partnership type. Table 1 below provides four example water system partnership
opportunities to demonstrate typical activities to address water system challenges. Keep in mind that
the partnership type, and the particular variation of the partnership type, will likely affect the funding
sources for which the project needs and is eligible.

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Water System Partnerships - Getting Started

Table 1. Example water system partnership opportunities.

Weakness(es)

Opportunity/

Water System

Water System Partnership Steps to

Addressed

Variation

Partnership Type

Consider





to Consider



 Limited

Information

Informal

 Start an information sharing group

knowledge

sharing

Cooperation

 Based on needs, organize events

base





(e.g., trainings, workshops)

 Limited

Operator

Contractual

 Meet with water system managers

operators

sharing

Assistance

 Coordinate with board members

 Operators





 Develop contracts with help of

lacking





legal assistance

certification







 Multiple

Interconnection

Joint Power

 Consider need for creating a single

water systems

of multiple

Agency

entity to serve multiple water

struggling

water systems



systems

with similar







water quality







problems







 System is

Acquisition

Ownership

 If you're considering selling,

unable to



Transfer

consider stakeholders and public

operate





support

independently





 If you're considering acquiring,

to provide





consider the added responsibility

safe drinking





of meeting the water systems

water





demands

Step 3. Identify assistance with project development

Finding and building support is critical for a successful partnership.

Third party technical assistance providers can provide support in a
variety of ways, including conducting an analysis of strengths and
weaknesses, identifying projects or alternatives, identifying or
applying for funding sources, and even supporting water systems with
managing funds once awarded.

There are also funding sources (e.g., DWSRF set-asides) that can be used to assist the water system with
evaluating the problem, determining alternative solutions, and assisting with applying for funding.
Investing time during the planning phase can be beneficial in the long-run to ensure the partnership is
successful.

If you need help at any step,
even with basic planning, you
can contact state or regional
coordinators for assistance
(e.g., AWWA section, RCAP
regional office).

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Water System Partnerships - Getting Started

Identifying Partners

Once you have a project in mind, you need to enlist
the right partners. Note that the steps below may be
addressed in a different order than that listed,
depending on the water system's existing
relationships and needs.

Step 1. Research and meet nearby water
systems

 Attend trainings, conferences, and workshops sponsored by local municipal water associations
and by your state's funding agency, join local organizations (e.g., NRWA, AWWA local chapter)
to meet nearby water systems

Consult with regional plans and the community to identify nearby water systems, particularly
focusing on water systems within a 5-10 mile radius of your water system
Consider the strengths and challenges of the nearby water systems and how they might be able
to help you or how you might be able to help them

Step 2. Start conversations with water systems about partnering

	Schedule an informal meeting with the water systems to begin discussions of water system
strengths and challenges and how you might be able to help each other

	Complete a SWOT analysis for your potential partners

Partner Strengths
The potential advantages of partnering.

-	Do you already know the partner?

-	Do you already trust the partner?

Partner Opportunities
The potential benefits to build on.

- Partner uses similar treatment methods

- Partner is within 5 miles of your water
system

- Partner has a particular expertise

Example
SWOT Analysis

Partner Weaknesses
The potential disadvantages.

Would the partnership bring about risk?

- Would the capacity of the partner
jeopardize your water system?

Partner Threats

The potential risks.

- Partner is unwilling to sign an MOU

- Partner has significant financial capacity
issues and might be a liability

Partnership would only benefit one partner

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Water System Partnerships - Getting Started

Identifying Funding Sources

Funding sources may already have been obtained while completing the steps above, to support
applicable project preparation. Once the project and partner(s) and applicable preparation have been
solidified, the next step is to identify a potential funding source to support project implementation.
When searching for funding sources, keep in mind that every source will have different limitations and
legal implications. See the Next Steps section below for other items you will need to consider.

Step 1. Conduct desktop research

	Visit the following sites to see a list of funding sources that may be applicable:

o EPA's Water System Partnerships Funding Resources
o EPA's Water Finance Clearinghouse
o Environmental Finance Center Network's Funding
Sources by State or Territory map

	Search using keywords to identify applicable funds.

o General keywords may include: funding, financing,

water system, support, grant, or loan,
o Project-specific keywords may include: design,
planning, compliance, rural, operator services, or
merger.

o Regional- or county-level specific keywords may

include: northeast, southeast, southwest, northwest, homeowners association, or
community development.

Step 2. Compile a list of eligible funding sources

	Cross-check your project against the funding source's eligibility requirements.

	Determine which sources of funding can help with technical assistance to get your project ready
for funding.

Step 3. Reach out to points of contact

	As you compile your list, identify the points of contact (POC)
on the funding resources' webpages.

	Contact the funding resource's POC to discuss your potential
application, learn schedules to be mindful of, ask any
questions, and express your enthusiasm and any urgency for
the project.

Reminder! At any point, reach out to
your state water program, a technical
assistance provider, USDA field office,
state funding coordination group, or
others to help identify funding
mechanisms for infrastructure projects or
technical assistance.

For more information about state groups
that support water infrastructure funding
and technical assistance, visit the Small

Community Water Infrastructure
Exchange's survey information.

Step 4. Narrow list of funding resources

	Visit the funding resource's webpage to find "how to apply"
to understand the scope of the application and your ability to
apply.

	Narrow the list of funding resources to those you can feasibly
apply to considering available resources and your project schedule.

	Some states have a single application, or single office, that reviews applications and wi
select which funding program is best for your project.

	See if your state has a funding coordination group that can help you narrow down funding
options.

help

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Water System Partnerships - Getting Started

Applying for Funding

Once the funding source(s) have been identified, the next step is to apply.

Step 1. Prepare for funding

There are a variety of steps to ensure you are ready to apply for funding and the specifics will depend on
the type of project and the funding source, but typical activities include:

Typical Activities to Prepare
for Funding

Notes

Ensure your financials are in
order

A few helpful resources to get started:

	Rural Communitv Assistance Corporation's 2006 Financial Plannina: A
Guide for Water and Wastewater Systems

	EPA's 2006 Settina Small Drinkina Water System Rates for a Sustainable
Future

	Organization for Economic Cooperation and Development's 2009
Strateaic Financial Plannina for Water Supply and Sanitation

Evaluate all project
options/alternatives

	Contact your state agency point of contact to see if they can help you
or refer to other points of contact.

	Reach out to local or state planning organizations.

	Note, some funding programs can be used to assist water systems in
evaluating project options/alternatives.

Build or consult any
regional/community plans or
business plans/action plans

	Business plans are essential for planning purposes. Plans should
provide details about the partnership including the organization
structure, financial information, managerial operations, etc.

	EPA's Water Svstem Partnership Workshop includes a Module
worksheet to help a system complete their own Action Plan.

Pull together all engineering
and design specifications

	There may be available funding programs that will cover the cost to
develop these.

	These specifications should be handy throughout the process.

Refer to state/local regulations,
as well as federal requirements

	This depends on the funding source.

	This is to ensure the systems involved are following all legal
requirements and to reduce complications further in the process.

Identify and address other pre-
requisites needed for funding
program(s) selected

	In some cases, an environmental review is needed.

	Consult other team members to ensure all pre-requisites are met for
the funding source.

	Create a plan to address outstanding pre-requisites and assign it to a
team member.

Step 2. Consult with the team on outstanding items

 Your team will likely include others at your water system and/or potential project champions,
allies, stakeholders, and state technical assistance providers.

o Consult with the team on the items that need to be address under Step 1 above.

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Water System Partnerships - Getting Started

Step 3. Set tasks and deadlines

	Develop a timeline and delegate tasks to complete the funding application.

	Consider using free resources (e.g., Environmental Finance Centers, Rural Community Assistance
Partnership Network, and DWSRF Program assistance) to help with grant writing or other parts
of the funding application.

	Ensure application fully addresses each award criteria.

Step 4. Submit application

	Consider more than one funding resource and submit in multiple funding cycles if needed.

	Obtain receipt or confirmation that the application has been received.

	Contact any stakeholders and/or team members who worked on the application to schedule a
debrief meeting.

Next Steps

After applying for funding, pay close attention to any expected timelines and follow-up procedures or
requests. Once you receive a notification of approval, make sure to notify the project team and schedule
a kickoff call.

Before you get started, your team will need to develop a plan for managing the funds that makes sure
you are in compliance with any limitations of use, reporting requirements, or other stipulations of the
funding. It is important to ensure proper management of the awarded funds. Every funding program will
have specific requirements for how you and your funders go about managing the funds. For example,
funders might distribute funds as reimbursements as opposed to up front allotments. Funders might
also schedule check-ins to ensure compliance with grant or loan terms and applicable laws, to check on
project progress, and to ensure success of the project. Proper reporting of the project as it progresses is
another important element of fund management. This is required for most funding sources and the
funder will likely require you to report specific elements through your scheduled period and retain
records for a certain period of time after a project is completed. Review the funding terms and
conditions for more specifics and consider acquiring contracting expertise if you need assistance at this
stage.

Congratulations! You are on your way to implementing water system partnership activities and
improving technical, managerial, and financial (TMF) capacity in your community.

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