Drinking Water State Revolving Fund: Program Overview and Issues Page: 1 of 6
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Order Code RS22037
February 1, 2005
CR8 Report for Congress
Received through the CRS Web
Drinking Water State Revolving Fund:
Program Overview and Issues
Specialist in Environmental Policy
Resources, Science, and Industry Division
In the Safe Drinking Water Act (SDWA) Amendments of 1996 (P.L. 104-182),
Congress authorized a drinking water state revolving loan fund (DWSRF) program to
help public water systems finance infrastructure projects needed to comply with federal
drinking water regulations and to protect public health. Under this program, states
receive capitalization grants to make loans for drinking water projects and to support
certain other SDWA activities. The DWSRF program was authorized at $1 billion
annually through FY2003. Since the program was first funded in FY1997, Congress has
provided $7.8 billion, including roughly $843 million for FY2005. Through June 2004,
the program had provided $7.9 billion in assistance and supported 6,500 projects.
The Environmental Protection Agency's (EPA's) 2001 survey of capital
improvement needs for public water systems indicated that these systems need to invest
$150.9 billion on infrastructure improvements over 20 years to ensure the provision of
safe water. Key issues include the gap between estimated needs and funding; SDWA
compliance costs, particularly for small systems; and the broader need for cities to
improve their water infrastructure, separate from SDWA compliance. In the past two
congresses, bills were reported that proposed to increase DWSRF funding levels and
establish small system grant programs. Several new standards promise to increase costs,
and congressional interest is likely to continue. This report will be updated.
The 104th Congress substantially revised the Safe Drinking Water Act with the 1996
SDWA Amendments. A key new provision, Section 1452, authorized a drinking water
state revolving loan fund (DWSRF) program to help public water systems finance
improvements needed to comply with federal drinking water regulations and to address
the most serious risks to human health. The law authorizes EPA to make grants to states
to capitalize DWSRFs. States must match 20% of the federal grant and develop intended
use plans that indicate how allotted funds will be used. States may use the DWSRF to
provide loans and other assistance to eligible public water systems for expenditures that
EPA has determined will facilitate SDWA compliance or significantly further the Act's
health protection objectives. Eligible projects include installation and replacement of
failing treatment facilities, distribution systems, and certain storage facilities. Projects to
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Drinking Water State Revolving Fund: Program Overview and Issues, report, February 1, 2005; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc816048/m1/1/: accessed December 13, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.