The Clean Water Act (CWA) 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.

2018 Financial Highlights

•	The CWSRF programs provided over $6.8 billion in funding for high priority water infrastructure and
other water quality projects. Cumulatively, CWSRF programs have provided $133 billion in assistance,
mainly in the form of low cost financing, to a wide range of eligible borrowers.

•	Since 2009, approximately $4.2 billion has been provided as additional subsidy in the form of direct
grants and principal forgiveness. Approximately $250 million was provided in 2018 alone.

•	Total assets are approximately $72 billion. This represented a $1.5 billion increase from the previous
year.

•	Net assets have exceeded $51 billion. This is a $1.4 billion increase from the previous year.

•	In 2018, federal contributions were over $1.2 billion.

•	In 2018, operating revenues exceeded operating expenses by over $80 million.

•	In 2018, earnings from loans and investments exceeded $1.3 billion.

•	The CWSRF programs issued nearly $2 billion in leveraged bonds to provide additional funding for
projects.

National aggregate financial statements were developed using data entered in EPA's National Information
Management System between July 1, 2017 and June 30, 2018. 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-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 3)

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 4)

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

Statement of Net Assets (Page 5)

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.

2018 Financial Statements | Page 1


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Statement of Fund Activity (Millions of Dollars)

Annual Fund Activity

FY 2017

FY 2018

Federai Capitalization Grants

996.5

1,364.5

State Matching Funds

220.1

560.6

New Funds Available for Assistance

6,625.9

6,567.9

Executed Assistance Agreements

7,451.9

6,788.7

Project Disbursements

6,368.5

6,255.4

Cash Draws from Federal Capitalization Grants

1,259.7

1,225.7

Total Annual Subsidy

300.1

250.8

Grants

101.5

19.9

Negative interest

0.0

0.0

Principal Forgiveness

198.6

231.0

Cumulative Fund Activity





Federal Capitalization Grants

41,978.7

43,343.2

State Matching Funds

7,873.7

8,434.2

Funds Available for Assistance

128,120.2

134,688.1

Executed Assistance Agreements

126,190.0

132,978.7

Project Disbursements

110,188.1

116,443.6

Cash Draws from Federal Capitalization Grants

40,508.9

41,734.6

Total Cumulative Subsidy

4,596.2

4,847.0

Grants

634.9

654.7

Negative Interest

0.0

0.0

Principal Forgiveness

3,961.3

4,192.2

2018 Financial Statements | Page 2


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Statement of Revenues, Expenses, and Earnings

(Millions of Dollars)

Operating Revenues

FY 2017

FY 2018

Interest on Investments

254.8

325.1

Interest on Loans

979.8

989.9

Total Operating Revenues

1,234.6

1,315.0

Operating Expenses





Bond Interest Expense

866.8

907.5

Amortized Bond Issuance Expense

18.7

27.0

Administrative Expenses

61.4

49.0

Additional Subsidy Provided

300.1

250.8

Total Expenses

1,247.0

1,234.3

Nonoperating Revenues and Expenses





Federal Contribution (Cash Draws)

1,259.7

1,225.7

State Contributions

151.4

152.6

Transfers from (to) DWSRF

(1.9)

(61.4)

Total Nonoperating Revenues (Expenses)

1,409.1

1,317.0

Increase (Decrease) in Net Assets

1,396.7

1,397.7

Net Assets





Beginning of Year

48,268.9

49,665.6

End of Year

49,665.6

51,063.3

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2018 Financial Statement I Page 3


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Statement of Cash Flows (Millions of Dollars)

Operating Activities

FY 2017

FY 2018

Cash Draws from Federal Capitalization Grants

1,259.7

1,225.7

Contributions from States

151.4

152.6

Loan Disbursements (Including Additional Subsidy)

(6,368.5)

(6,255.4)

Loan Principal Repayments

3,930.8

4,110.4

Interest Received on Loans

979.8

989.9

Administrative Expenses

(61.4)

(49.0)

Total Cash Flows from Operating Activities

(108.2)

174.2

Noncapital Financing Activities





Gross Leveraged Bond Proceeds

2,215.4

1,962.8

Bond Issuance Expense

(18.7)

(13.3)

State Match Bond Proceeds

68.8

407.9

Cash Received from Transfers with DWSRF

(1.9)

(61.4)

Interest Paid on Leveraged and State Match Bonds

(866.8)

(907.5)

CWSRF Funds Used for Refunding

(23.0)

0.0

Principal Repayment of Leveraged Bonds

(1,470.7)

(2,102.4)

Principal Repayment of State Match Bonds

(65.8)

(133.4)

Net Cash Provided by Noncapital Financing Activities

(162.7)

(847.2)

Investing Activities





Interest Received on Investments

254.8

325.1

Release (Deposit) of Leveraged Bond Debt Service Reserve

32.0

281.4

Net Cash Provided by Investing Activities

286.7

606.4

Net Increase (Decrease) in Cash and Cash Equivalents

15.9

(66.5)

Cash and Cash Equivalents





Beginning of Year

13,624.1

13,640.0

End of Year

13,640.0

13,573.4

2018 Financial Statements | Page 4


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Statement of Net Assets (Millions of Dollars)

Assets

FY 2017

FY 2018

Cash and Cash Equivalents

13,640.0

13,573.4

Debt Service Reserve - Leveraged Bonds

3,642.3

3,360.9

Loans Outstanding

52,889.0

54,783.3

Unamortized Bond Issuance Expenses*

256.8

243.1

Total Assets

70,428.0

71,960.7

Liabilities





Match Bonds Outstanding

607.5

882.0

Leveraged Bonds Outstanding

20,155.0

20,015.4

Total Liabilities

20,762.4

20,897.4

Net Assets





Federal Contributions (Cash Draws)

40,508.9

41,734.6

State Contributions

5,648.6

5,801.3

Transfers - Other SRF Funds

(534.3)

(595.6)

Other Net Assets

4,042.3

4,123.1

Total Net Assets

49,665.6

51,063.3

Total Liabilities and Net Assets

70,428.0

71,960.7

* Unamortized Bond Issuance Expenses are costs that have been incurred but have not been fully recognized
(amortized). These costs will be recognized (amortized) overtime over the remaining life of the bonds
outstanding, similar to a pre-paid expense, and consistent with GAAP.

2018 Financial Statements | Page 5


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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

J* Clean Water

State Revolving Fund

www.epa.gov/cwsrf

vvEPA

Office of Water • April 2019 • EPA Publication 832R19001


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