Drinking Water State Revolving Fund Grant

Drinking Water State Revolving Fund Grant

Status: ACTIVE
Funder: Texas Water Development Board (TWDB)
Amount: Up to US $1,000,000
Last Updated: February 02, 2026

Summary

The Drinking Water State Revolving Fund (DWSRF) provides low-cost financing for water projects that ensure compliance with drinking water standards. With year-round funding, eligible applicants such as public and nonprofit water systems can secure assistance for planning, design, and construction of water infrastructure. For FY 2024, $435 million is available, including $95 million in principal forgiveness. Applications open in December and close in March, requiring submission of a Project Information Form.

Overview

NOTE: DWSRF financing is available year-round. In order to be invited to apply for funding, entities must submit a completed Project Information Form which is usually signified by a deadline in March so they can be added on the initial Intended Use Plan project priority list. Drinking Water State Revolving Fund (DWSRF) Loan Program The DWSRF assists communities by providing low-cost financing for a wide range of water projects that facilitate compliance with drinking water standards. Streamlining the program provides year-round funding as projects are included in the DWSRF Intended Use Plan. What can the program do for you? The Drinking Water State Revolving Fund, authorized by the Safe Drinking Water Act, provides low-cost financial assistance for planning, acquisition, design, and construction of water infrastructure. What types of projects can I use the loan funding for? Financial assistance from the DWSRF can be utilized for: Correcting water system deficiencies including water quality, capacity, pressure, and water lossUpgrading or replacing water systems Providing new or existing service to other water systems through consolidation projects Purchasing capacity in water systems Purchasing water systems Implementing green projects (pursuant to EPA guidanceImplementing source water protection projects Implementing source water protection projectsAre loans or grants offered? Both below market interest rate loans and principal forgiveness (similar to grants) are offered. The interest rate on loans will be a percentage reduction from the Thomson Reuters Municipal Market Data (MMD) rate adjusted for yield to maturity that is applicable to the entity's rating, with non-rated entities using the Baa rate, as follows: Equivalency projects: 35% reductionNon-Equivalency projects: 30% reduction What project components can I receive funding to complete? The DWSRF program provides financial assistance for planning, acquisition, design, and construction of your water system project. How much funding is available? Whether you are seeking financial assistance for smaller projects to large-scale capital improvement projects, the DWSRF program can assist with your financing needs. For State Fiscal Year 2024, at least $435 Million is available under the DWSRF program for all financing options including $95 Million in principal forgiveness. This funding consists of the annual appropriations from the DWSRF capitalization grant funds and the supplemental appropriations from the Infrastructure Investment and Jobs Act of 2021 (IIJA). When can I apply for SRF financial assistance? Solicitation for the SRF Programs opens in December of every year and closes in March of the following year. Entities must submit a completed Project Information Form (PIF) by the deadline to be invited to apply for funding under the initial IUP. Join our mailing list so you are notified of when solicitation opens and of all important deadlines. You may also submit a PIF for funding at any time. However, your project will not be included in the initial project priority list if it is not submitted by the solicitation deadline.

Eligibility

You can learn more about this opportunity by visiting the funder's website. Eligible Applicants:Publicly and privately owned water systemsNonprofit water supply corporationsNonprofit, non-community public water systemsPrincipal forgiveness is available on a limited basis to eligible applicants. Disadvantaged communitiesThe amount of principal forgiveness for a regular disadvantaged project (up to 70%) is dependent on the annual median household income (AMHI) and household cost factor (HCF) for the project area.Small/rural disadvantaged communitiesEntities qualified as a disadvantaged community and that additionally meet the definition of either a small community (serve a population of 10,000 or fewer) or a rural project (see definition in the IUP) are eligible for up to 100% principal forgiveness ($1,000,000 maximum).Very small systemsProjects that serve a population of 1,000 or fewer are eligible for up to 100% principal forgiveness ($400,000 maximum).Green projectsEntities may receive subsidized green funding (up to 15% forgiveness) if their project has eligible components that total 30% of the project's total cost.Urgent need projectsIf a project is determined to be of urgent need, the applicant may qualify for 100% principal forgiveness ($500,000 maximum unless a disadvantaged community, then up to $800,000 maximum). The project must not be for replacement of facilities that have failed because they exceeded their useful life or failed due to lack of adequate maintenance.Eligible Projects:Planning, design, acquisition, and construction to:Correct water system deficiencies Upgrade or replace water systems Consolidate systems Purchase capacity Purchase other systems Implement green projects Implement source water protection projects