Region 1: EPA New England
Clean Water State Revolving Fund (CWSRF) in New England
This page provides information on EPA New England's Clean Water State Revolving Fund. The page highlights how the program works, what kinds of water projects are funded, and who can apply for them. The page also contains examples of successful projects and links to our New England state partners.
What is the CWSRF?
The Clean Water State Revolving Fund (CWSRF) program is a federal/state partnership designed to help communities finance the cost of infrastructure needed to achieve and maintain compliance with the Clean Water Act (CWA). The CWSRF program is a major source of low-cost funding for upgrades and improvements to wastewater treatment facilities and other eligible projects. The CWSRF is available to fund a wide variety of water quality projects including: 1) traditional municipal wastewater treatment projects; 2) contaminated runoff from urban and agricultural areas; 3) wetlands restoration; 4) groundwater protection; 5) brownfields remediation; 6) estuary management; and 7) green infrastructure, which includes traditional non-point source projects like berms and rain gardens, to energy efficiency and energy production. Projects types 2 through 5 must pertain to non-point source and estuary water quality protection and/or restoration projects.
Each of the six New England states maintains CW revolving loan funds to provide low-cost financing for a wide range of water quality infrastructure projects. Funds to establish or capitalize the CWSRF programs are provided through federal government grants and state matching grants (equal to 20% of federal government grants). The CWSRF program has funded approximately $95 billion nationally, while the six New England states have funded $9.9 billion since the program's inception in 1989 thru 2012.
Key Features of the CWSRF Program
Low interest loans from the CWSRF can save a system millions of dollars over the twenty year life of the loan. The loans can be below-market interest rates (between the cost of borrowing in the bond market at the time of the loan and zero) and the loan repayments are returned to the CWSRF fund over 20 years. The repaid loans are then available to be loaned out to other eligible projects. This is especially helpful to those communities that do not have access to the bond market or other sources of borrowing funds inexpensively. The CWSRF is a far more flexible program than its predecessor the Construction Grants program. Under the CWSRF, states have a wide range of options in deciding how to set up their programs. States may choose from a variety of assistance options, including loans, refinancing, purchasing or guaranteeing local debt, and purchasing bond insurance. States can also set specific loan terms, including interest rates—from zero percent to market rate—and repayment periods—up to 20 years. States have the flexibility to target resources to their particular environmental needs, including contaminated runoff from urban and agricultural areas, wetlands restoration, groundwater protection, brownfields remediation, estuary management, and wastewater treatment.
States may also customize loan terms to meet the needs of small and disadvantaged communities. In 2009, 77 percent of all loans nationally (23 percent of funding) were made to communities with populations less than 10,000. In addition, some states provide specialized assistance for communities that are disadvantaged or experiencing financial hardship. These states might offer lower or no-interest loans to provide greater subsidies for disadvantaged communities.
A primary focus of EPA's Clean Water and Drinking Water Infrastructure Sustainability Policy is to promote utility planning processes that support sustainable water infrastructure and communities. The goal is for a robust planning process to occur during the development phase of the project, before the infrastructure solution is selected and designed. This will allow the utility to work with stakeholders in the community to ensure that the utility's goals also support other relevant community priorities. It will also allow the utility to evaluate a range of infrastructure options, including, as appropriate, conservation approaches, decentralized treatment with centralized management, and green infrastructure based on factors such as public health, water quality, and economic health. Specific types of sustainable projects that may be eligible for CWSRF funding, include:
- Funding for Green Infrastructure – Funding for green infrastructure began with the American Recovery and Reinvestment Act (ARRA) of 2009. Congress requires the SRF programs to continue the "Green Program Reserve" and fund green infrastructure, with language in EPA's annual Appropriations Bills. States were required to spend at least 20% of their annual appropriations in FY 2010 and FY 2011, and at least 10% of their capitalization grants in FY 2012 and FY 2013.
- Wastewater and drinking water facilities are large users of energy in most communities, as high as 30% of their energy consumption. Thus, funding energy efficient, water efficient, environmentally innovative, or green infrastructure projects can really help wastewater systems operate more sustainable operations over the long-term. Encouraging the replacement of old, energy inefficient motors and pumps, lights and aeration equipment can greatly reduce a communities' energy use. Many systems can also produce energy, using waste digesters to produce energy from sludge, or by installing wind turbines and solar panels. For example, there are several wastewater facilities in Massachusetts that are either net-zero or getting close to this goal, where the facility produces more energy than they use to run the plant. Examples of eligible green infrastructure includes:
- Green stormwater to manage wet weather, such as permeable pavement, bio-retention, trees, green roofs, constructed wetlands, downspout disconnect programs, etc.
- Funding energy efficiency
- Upgrades to POTW lighting, SCADA systems, fine-bubble aeration, Infiltration/inflow, solar panels, wind turbines, etc.
- Funding environmentally innovative
- POTW climate change adaptation, projects that eliminate/ reduce chemical use, educational projects, LEED buildings, etc.
How does the CWSRF Program work?
CWSRF programs operate much like environmental infrastructure banks that are capitalized with federal and state contributions. CWSRF monies are loaned to communities and loan repayments are recycled back into the program to fund additional water quality protection projects. The revolving nature of these programs provides for an ongoing funding source that will last far into the future. Depending on statewide needs, some states provide additional funds, above and beyond the state match requirement, in order that the SRF program can fund more eligible projects that are ready to proceed to construction.
What are the CWSRF Needs in New England?
To determine the cost of the water quality and water-related public health goals of the CWA Section 516(b), EPA undertakes the Clean Watershed Needs Survey (CWNS) every four years. The CWNS is an assessment of wastewater infrastructure needs, combined sewer overflow needs and other eligible infrastructure for all systems in a particular state, to meet the water quality standards mandated by the Clean Water Act. The latest needs survey is not yet complete. This section will be updated when the new data is available.