The Clean Water Act requires an annual financial audit of the 51 state-level CWSRF programs. Each
state and Puerto Rico conducts these audits according to the generally accepted accounting standards
(GAAP) established by the Governmental Accounting Standards Board (GASB). States often define their
CWRSF programs as ongoing enterprise funds under the GASB definitions of funds.

2017 Financial Highlights

•	The CWSRF programs provided over $7.4 billion in funding. In just
the past two years alone, over $15 billion in low cost financing went to
2,825 high priority projects.

•	Cumulatively, the CWSRF programs have provided over $126 billion
over the past 30 years.

•	Almost 3 percent increase ($1.4 billion) in CWSRF Program Equity (net
assets), for a cumulative total of $49.6 billion.

•	Nearly $6.3 billion was disbursed for projects, which is a $200 million
increase from the previous year.

•	Earnings from loans and investments exceed bond and administrative
expenses by $272 million.

•	Leveraged bond proceeds added an additional $2.2 billion to program
cash flow, which is $351.8 million greater than the amount added in
the previous year.

2017 Financial Statements | Page 1


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National aggregate financial statements have been developed using data entered in EPA's National
Information Management System between July 1, 2016 and June 30, 2017, Because the 51 CWSRF
programs are independent state-level entities, no nationally audited CWSRF program financial reports
are available. The financial statements are non-audited, cash flow-based financial reports. The four
statements are described below.

Statement of Fund Activity (Page 2)

Provides an overview of major indicators of fund activity, including capitalization grant levels, project
commitments, project disbursements, and subsidies provided. Both annual and cumulative data are
given.

Statement of Revenues, Expenses, and Earnings (Page 4)

Describes the overall performance of the CWSRF fund over the reporting period that is reflected in the
increase or decrease in net assets.

Statement of Cash Flows (Page 5)

Provides a detailed accounting of the actual flow of cash into and out of the CWSRF fund.

Statement of Net Assets (Page 6)

Describes CWSRF assets and liabilities through the end of the fiscal year. Assets include financial assets
and capital assets. Liabilities include both current and long term liabilities. CWSRF assets include grant
funds that have been drawn from the federal treasury to date, but do not include total grant awards.
CWSRF assets also include state matching contributions that have been deposited in the fund.

2017 Annual Report | Page 2


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Statement of Fund Activity (Millions of Dollars)

Annual Fund Activity

FY 2016

FY 2017

Federal Capitalization Grants

1,517.9

996.5

State Matching Funds

284.8

215.2

New Funds Available for Assistance

7,260.6

6,577.2

Executed Assistance Agreements

7,625.2

7,422.9

Project Disbursements

6,078.4

6,285.3

Cash Draws from Federal Capitalization Grants

1,505.7

1,259.7

Total Annual Subsidy

183.0

294.5

Grants

46.8

100.7

Negative interest

0.0

0.0

Principal Forgiveness

136.2

193.8

Cumulative Fund Activity





Federal Capitalization Grants

40,982.2

41,978.7

State Matching Funds

7,654.0

7,869.2

Funds Available for Assistance

121,562.0

128,139.2

Executed Assistance Agreements

118,683.4

126,106.3

Project Disbursements

103,819.6

110,104.9

Cash Draws from Federal Capitalization Grants

39,249.2

40,508.9

Total Cumulative Subsidy

4,294.0

4,588.6

Grants

532.4

633.1

Negative Interest

0.0

0.0

Principal Forgiveness

3,761.6

3,955.5

Cumulative Executed Assistance Agreements as a percent of Funds Available for Assistance ("pace") remains
at 98 percent, continuing the trend of successfully directing CWSRF funding towards projects that address
many important water quality problems. Below market interest rates, flexible financing options, and effective
outreach contributed to the ongoing success of the CWSRF programs.

2017 Annual Report | Page 3


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Statement of Revenues, Expenses

(Millions of Dollars)

and Earnings

Operating Revenues

FY 2016

FY 2017

Interest on Investments

251.8

256.7

Interest on Loans

1,009.9

973.5

Total Operating Revenues

1,261.7

1,230.2

Operating Expenses





Bond Interest Expense

874.3

879.7

Amortized Bond Issuance Expense

19.4

18.1

Administrative Expenses

57.1

60.1

Additional Subsidy Provided

183.0

294.5

Total Expenses

1,133.8

1,252.3

Nonoperating Revenues and Expenses





Federal Contribution (Cash Draws)

1,505.7

1,259.7

State Contributions

172.2

150.4

Transfers from (to) DWSRF

(12.9)

(1.9)

Total Nonoperating Revenues (Expenses)

1,665.0

1,408.2

Increase (Decrease) in Net Assets

1,792.9

1,386.1

Net Assets





Beginning of Year

46,425.4

48,218.2

End of Year

48,218.2

49,604.3

Operating Expenses exceeded Operating Revenue by $22,1 million. This small deficit reflects the fact that
$294.5 million in additional subsidy was provided in FY 2017 to promote non-traditional projects and support
disadvantaged communities.

Revenue from loans and investments exceeded bond and administrative expenses by $272.4 million.

2017 Financial Statements | Page 4


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Statement of Cash Flows (Millions of Dollars)

Operating Activities

FY 2016

FY 2017

Cash Draws from Federal Capitalization Grants

1,505.7

1,259.7

Contributions from States

172.2

150.4

Loan Disbursements (Including Additional Subsidy)

(6,078.4)

(6,285.3)

Loan Principal Repayments

4,102.3

3,930.7

Interest Received on Loans

1,009.9

973.5

Administrative Expenses

(57.1)

(60.1)

Total Cash Flows from Operating Activities

654.5

(31.1)

Noncapital Financing Activities





Gross Leveraged Bond Proceeds

1,863.6

2,215.4

Bond Issuance Expense

(14.1)

(19.4)

State Match Bond Proceeds

112.6

64.8

Cash Received from Transfers with DWSRF

(12.9)

(1.9)

Interest Paid on Leveraged and State Match Bonds

(874.3)

(879.7)

CWSRF Funds Used for Refunding

(26.4)

(23.0)

Principal Repayment of Leveraged Bonds

(1,483.8)

(1,464.5)

Principal Repayment of State Match Bonds

(106.8)

(65.8)

Net Cash Provided by Noncapital Financing Activities

(542.2)

(174.1)

Investing Activities





Interest Received on Investments

251.8

256.7

Release (Deposit) of Leveraged Bond Debt Service Reserve

521.3

39.2

Net Cash Provided by Investing Activities

773.1

295.9

Net Increase (Decrease) in Cash and Cash Equivalents

885.4

90.7

Cash and Cash Equivalents





Beginning of Year

12,555.0

13,440.4

End of Year

13,440.4

13,531.1

2017 Financial Statements | Page 5


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Statement of Net Assets (Millions of Dollars)

Assets

FY 2016

FY 2017

Cash and Cash Equivalents

13,440.4

13,531.1

Debt Service Reserve - Leveraged Bonds

4,022.9

3,983.7

Loans Outstanding

50,753.5

52,813.5

Unamortized Bond Issuance Expenses*

251.2

252.5

Total Assets

68,467.9

70,580.9

Liabilities





Match Bonds Outstanding

604.4

603.5

Leveraged Bonds Outstanding

19,645.3

20,373.1

Total Liabilities

20,249.7

20,976.6

Net Assets





Federal Contributions (Cash Draws)

39,249.2

40,508.9

State Contributions

5,497.8

5,648.2

Transfers - Other SRF Funds

(524.8)

(526.8)

Other Net Assets

3,996.1

3,974.0

Total Net Assets

48,218.2

49,604.3

Total Liabilities and Net Assets

68,467.9

70,580.9

* 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 outstand-
ing, similar to a pre-paid expense, and consistent with GAAP.

Loans Outstanding increased by over $2 billion, and is a main contributor to the over $2.1 billion increase in
Total Assets.

Federal and State Contributions helped increase Net Assets by nearly $1.4 billion.

The $22.1 million decrease in Other Net Assets is mainly due to the increased use of additional subsidy in FY
2017.

2017 Financial Statements | Page 6


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For more information about the Clean Water State Revolving Fund, please contact us at

United States Environmental Protection Agency
Office of Wastewater Management
Clean Water State Revolving Fund Branch
1200 Pennsylvania Avenue NW (4204M)
Washington, DC 20460

Clean Water

State Revolving Fund

www.eoa.gov/cwsrf

c/EPA

Office of Water • March 2018 • EPA Publication 830R17007


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