Program Manager message: Infrastructure Funding

During the 2020s, we have seen unprecedented federal support for funding drinking water infrastructure. However, it has also been complicated and challenging, and the future is uncertain regarding the continuation of federal funding. Yet it remains quite certain that water infrastructure needs for the next couple of decades will be enormous. The need stems from both replacing aging infrastructure and meeting new federal public health protection requirements, including lead and PFAS, with another major rule coming out in a couple of years to update the Microbial/Disinfection Byproducts (M/DBP) suite of rules.

As we reported in 2022, President Biden signed the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA) into law in 2021. The IIJA appropriated significant funds to the State Revolving Fund Programs (SRF), which is administered by the Co
lorado Water Resources and Power Development Authority, Department of Local Affairs, and CDPHE. The Authority is the grant recipient for the SRF. DOLA evaluates the financial structure of the applicant’s application to the SRFs, and CDPHE manages the technical and compliance aspects of the SRFs. The funding is being allocated in essentially three “buckets,” including general infrastructure, emerging contaminants, and lead service lines. Initially, Colorado was projected to receive approximately $680 million over the five years. However, the actual awards have fluctuated to some degree due to adjustments made in Congress and reallocations of some of the lead money. 

At this point, we are four years in and have one more to go. This funding represents a major opportunity for Colorado. But the need for continued water infrastructure support is enormous, especially considering the new federal drinking water rules mentioned above. There has been talk across the sector about extending the federal infrastructure investment. At the recent annual conference of the Association of State Drinking Water Administrators (ASDWA), a panel regarding funding and finance recommended emphasizing the following points when communicating about water infrastructure needs:

• Positive impact for affordability. With so much pressure on rate payers these days, supporting water infrastructure is one way to support overall economic vitality and help keep water rates affordable. 
• Impact to small, rural communities. These communities tend to struggle most with tackling complicated, expensive infrastructure projects and these funding sources tend to help small, rural communities the most.
• Share responsibility. Federal, state and local governments all share roles and responsibilities for safe water, and infrastructure investments like IIJA demonstrate that commitment. 
• Fundamental societal need. Adequate infrastructure is a cornerstone of safe water which is foundational for the economy and national security.
• Specifically, for restoring SRF funding, the following points were discussed:
• Without the SRFs, loan forgiveness and many great assistance programs that benefit small, rural communities will be lost.
• SRF funding is vital to ensure the efficacy of many state primacy programs, which is a preferred option compared to direct federal implementation.
• The SRFs support water affordability in small, rural communities that cannot afford modern water infrastructure. 
• Commitment to the SRFs is needed because they provide below-market loans, even 0% interest loans and loan forgiveness (like grants), especially to small, rural communities.

We share a collective commitment with local governments to protect public health and ensure safe tap water for all. Sustained infrastructure funding can help us move forward toward that goal. Contact us if your community is interested in pursuing this funding. Thank you.

➽ Ron Falco, P.E., Safe Drinking Water Program Manager

Upcoming EPA Cyber/Resilience Funding Cycle

EPA Announces Availability of $9 Million to Protect Drinking Water from Natural Hazards and Cybersecurity Threats

The U.S. Environmental Protection Agency (EPA) has announced over $9 million in grant funding through the new competitive Midsize and Large Drinking Water System Infrastructure Resilience and Sustainability grant program, which will assist medium and large size public water systems with protecting drinking water sources from natural hazards, extreme weather events, and cybersecurity threats. The application period is open until October 6, 2025, and can be found on www.grants.gov under opportunity number EPA-OW-OGWDW-25-01, assistance listing number 66.488.

Learn More About The Grant Opportunity on EPA's Website

EPA will host a webinar on the Midsize and Large Drinking Water System Infrastructure Resilience and Sustainability Grant Program on August 19th, from 2:00 to 3:00 PM ET. Please join us to learn more.

Register for EPA's August 19th Webinar

State Revolving Fund Improvements

The State Revolving Fund (SRF) is implementing improvements to the prioritization process that will go into effect in 2025. The goal of these improvements is to ensure that the highest priority projects have the best chance at receiving SRF funding throughout the year. This article covers the upcoming changes and some helpful reminders as you begin preparing your application for funding.

• To receive updates about the SRF Program and reminders about the upcoming eligibility survey, please sign up for the Grants and Loans mailing list here. 

What is changing?

The current process is based on a first-come, first-serve process and does not utilize priority points until the end of the application process. As a result, it can prevent projects that score a high number of priority points from receiving funding because they apply too late in the funding year when funding capacities are lowest. The new prioritization process will implement priority scoring early in the process and provide advance notice of project priority and funding opportunities. The criteria for project scoring can be found in Attachment 1 of the Drinking Water Revolving Fund and Water Pollution Control Revolving Fund Intended Use Plans (IUPs).

Under the new process, priority points will be used to determine when a project may submit a loan application. Projects that score at or above the threshold may apply at any loan cycle during the year. Also, any borrower that qualifies as a disadvantaged community (DAC) is eligible to come in at any cycle. Projects that score below the threshold may only apply at the “Open” cycles. The priority point threshold for the WPCRF program is 100 and the threshold for the DWRF program is 110 points. Applicants will be provided a preliminary score at the prequalification stage and a final score at the project needs assessment stage. Please see the proposed schedule for "Open" and "Limited" cycles:

• January 5th (leveraged) - Open
• February 5th - Open
• April 5th - Limited
• June 5th (leveraged) - Limited
• August 5th - Limited
• October 5th - Limited
• November 5th - Limited

When will this go into effect?

The changes will go into effect in 2025. The current process will remain unchanged until that time. The 2025 IUP’s have been approved by the Water Quality Control Commission and will be posted on the website later this year. A list of FAQs can be accessed here. 

Helpful Tips & Reminders

In order to apply for SRF funds, you have to complete the eligibility survey which is the first step in the SRF process. The eligibility survey should be completed the year prior to be eligible for funding. The eligibility survey for funding in 2025 has been completed. If you are interested in future funding, be sure to complete the 2026 eligibility survey that will be open during the early summer of 2025. You will want to get signed up in the Colorado Environmental Online Services (CEOS) system to access the forms. The eligibility survey is not an application and completing it does not guarantee your project funding.

If you completed the 2025 eligibility survey and are planning on applying for funding in 2025, be sure you complete the Pre-Qualification form which triggers the next step of the process, the pre-qualification meeting. The Pre-Qualification form can be found in CEOS. During your pre-qualification meeting, your project manager will walk you through the loan process and the next steps. Here are links to the loan program steps for the Drinking Water Revolving Fund (DWRF) and Water Pollution Control Revolving Fund (WPCRF) and the main program page. 

If you have any questions about the SRF loan process, feel free to email cdphe_grantsandloans@state.co.us. If you need assistance navigating CEOS or form submission you can contact Angela Garcia  angela.garcia@state.co.us.

➽ Angela Green Garcia, Drinking Water Training Specialist

➽ James Wheatley, Project Manager

  

New Grant Provides Money for Emerging Contaminants!

The division has been awarded $86 million from the EPA to implement the EPA Emerging Contaminants for Small or Disadvantaged Communities Grant Program (EC-SDC). The purpose of the program is to assist public water systems in small or disadvantaged communities with planning and design grants, and infrastructure funding to reduce public health risks from emerging contaminants.

The division is implementing the grant program in a multi-round Request For Application (RFA) process for public water systems under two tiers: Tier 1 is a planning and design grant up to $300,000. Tier 2 is a construction grant in award amounts up to $10M per year for up to three years. The program places priority on PFAS treatment projects followed by manganese and other drinking water emerging contaminants. More information regarding program details can be found on the WQCD Water Quality Grants webpage under the EC-SDC blue banner.

In order for projects to be eligible for this funding they must be governmental or private non-profit public water systems, be considered disadvantaged, and have an identified emerging contaminant issue through direct sampling. The program is focused on addressing issues related to PFAS, but manganese is also considered an emerging contaminant and can be funded through this program. If your system has not completed any PFAS sampling yet, you can qualify for a one time sampling of your finished drinking water for PFAS. Use this form to request PFAS sampling for your public water systems.

The program has already funded a number of projects including a new water plant to treat PFAS, a pilot study to evaluate new technology to treat emerging contaminants, and a planning grant to conduct studies to determine system improvement options for treating PFAS and manganese. 

The division plans to release an RFA near the beginning of 2025 and systems are encouraged to apply for this grant opportunity. The RFA will be announced on the WQCD Water Quality Grants webpage under the EC-SDC blue banner. There will also be an announcement sent out to all subscribers of our listserv under the topics of “General - Grants and Loans” and “General - PFAS (Toxic Firefighting Foam Chemicals)”. Please go to the Stay Informed - Water Quality site to subscribe to these and other lists. If you have any questions or you would like to discuss a potential project please reach out to cdphe_wqcd_ec_sdc_grants@state.co.us.

➽ Mark Henderson, Section Manager, WQCD Community Development & Partnership Section

Ready, set, go - the WQCD provides assistance for lead service line projects

On December 16, 2021, EPA finalized the Lead and Copper Rule Revisions (LCRR), which further strengthened the protections against lead in drinking water. The LCRR requires community and non-transient, non-community public water systems to develop a service line inventory (LSLI) to identify the materials of service lines connected to the public water distribution system. If one or more lead, galvanized requiring replacement, or lead status unknown service lines are identified, systems must submit a lead service line replacement (LSLR) plan. Both documents are due to the Drinking Water Compliance Assurance Section by October 16, 2024.

The Water Quality Control Division (division) is providing free technical assistance and grants to help eligible public water systems with the service line inventory and lead service line replacement planning process. Additionally, there are low interest loans available for lead service line removal construction costs.

Direct Technical Assistance

Through a competitive bid process, the division has selected WSP, in partnership with Sunrise Engineering, to support water systems serving up to 15,000 persons. Suppliers can request remote support or hands-on assistance, offered at no cost until funding is depleted. The division has selected only one contractor to provide no-cost technical assistance and support to eligible water systems, and under this assistance program it will not reimburse systems for the costs of hiring outside contractors. Suppliers can sign up here to be contacted by WSP. 

Technical Assistance Grants

The division has additionally made grant funding available to assist public water systems with the service line inventory and lead service line replacement planning process for those systems who elect to perform work outside of the technical assistance program above. Grants range from $10,000 to $250,000, and cover 90% of the project cost. Applications will be accepted at four upcoming deadlines, beginning October 1, 2023. Grants will be awarded on a first-come, first- served basis during each application review period, until funds are depleted. Reimbursements will only be made for expenses incurred after the grant agreement is executed. Smaller water systems are encouraged to make use of the technical assistance provider before applying for grant funding. 

Eligible applicants for the grant program include:

• Publicly owned water systems and private not-for-profit public water systems whose service area is between 7,500 persons and 50,000 persons and whose Median Household Income is less than 120% of the State’s Median Household Income.
• Publicly owned water systems and private not-for-profit public water systems whose service area is larger than 50,000 persons, and whose Median Household Income is less than 80% of the State’s Median Household Income.
• Applicants must proceed with work within 30 calendar days of contracting. 

For more information on grant funding and application materials, please visit the division’s Water Quality Grants Webpage. 

SRF Program Loans for lead service line projects

For public water systems who know they have service lines that require removal and who are interested in construction funding or a combination of inventory work and concurrent removal work, please visit the State Revolving Fund web page for more information. Eligible applicants to the SRF program must have indicated lead service line funding needs on the annual SRF Eligibility Survey. 

Fundamentals of the Bipartisan Infrastructure Law (BIL)

On November 15, 2021, President Biden signed the $1.2 trillion Bipartisan Infrastructure Law (BIL) into law. The BIL appropriates a significant amount of funding to the State Revolving Fund Programs (SRF), which is administered by the Colorado Water Resources and Power Development Authority, Department of Local Affairs and CDPHE. The Authority is the grant recipient for the SRF, DOLA evaluates the financial structure of the applicant’s application to the SRFs, and CDPHE manages the technical and compliance aspects of the SRFs. The funding will be allocated in essentially three “buckets” over the next five years, which includes general infrastructure, emerging contaminants, and lead service lines. Colorado will receive approximately $680 million over the next five years, with much available as loan forgiveness (similar to a grant). Below is a table showing the anticipated awards.

Year	Clean Water - Supplemental Infrastructure Funds	Drinking Water - Supplemental Infrastructure Funds	Total
2022	$14,354,000	$35,476,000
2023	$17,616,000	$42,498,600
2024	$19,224,000	$46,377,900
2025	$20,824,000	$50,237,900
2026	$20,824,000	$50,237,900
Total:	$92,842,000	$224,828,300	$317,670,300
Year	Clean Water - Emerging Contaminants Funds	Drinking Water - Emerging Contaminants Funds	Total
2022	$753,000	$14,898,000
2023	$1,800,000	$15,000,000
2024	$1,800,000	$15,000,000
2025	$1,800,000	$15,000,000
2026	$1,800,000	$15,000,000
Total:	$7,953,000	$74,898,000	$82,851,000
Year	NA	Drinking Water - Lead Service Line Replacement Funds	Total
2022		$55,866,000
2023		$56,000,000
2024		$56,000,000
2025		$56,000,000
2026		$56,000,000
Total:		$279,866,000	$279,866,000
Totals:	$100,795,000	$579,592,300	$680,387,300
Blue numbers for 2022 are actual allotment numbers. 2023 through 2026 are estimates.

 

As stated above, the Bipartisan Infrastructure Law (BIL) funding is allocated by the EPA to the existing drinking and clean water state revolving fund (SRF) program. The process for awarding funds is the same as the existing program.

1. Applicants must submit an eligibility survey to be included on the state’s Intended Use Plan (IUP) that describes how funds will be used for the plan year.
2. Based on the eligibility surveys received, the division develops eligibility lists and includes them in the draft IUP. TheWater Quality Control Commission reviews and approves the IUP. 
3. After the commission approves the IUP, the eligibility lists are adopted by the Colorado Water Resources and Power Development Authority,and the General Assembly.
4. Communities that are included on the eligibility lists in the approved IUP may start the application process through the SRF.
5. The steps for a drinking water project are described in the DWRF Loan Program Steps and wastewater projects are described in the WPCRF Loan Program Steps.
6. The BIL requires funds to be issued as a combination of principal forgiveness and a subsidized loan. The eligible criteria are included in the Intended Use Plan. The projects are evaluated based on the criteria and may be awarded principal forgiveness subject to funding availability at the time of loan application. The eligibility criteria and BIL funding categories are included in the Addendum to the 2022 DWRF IUP and Addendum to the 2022 WPCRF IUP.  

This funding represents a major opportunity for Colorado. The existing SRF programs received approximately $34 million in funding from the EPA per year over the past few years. The BIL allocates an additional $121 to $143 million to the SRF program on a yearly basis for the next five years. No funding has been awarded yet, as the state is still in the process of applying for funds. But we currently have 40 applications in process that are being evaluated for eligibility with regards to BIL funding. The department will likely begin issuing funds within the next few months, depending on when EPA sends the funds.

While the BIL represents great opportunity, there are expected challenges too, such as:

1. The BIL funding requires a state match for the next five years. It appears that the state has the matching funds for the first year. But the program is working to determine how the state will meet the match requirements in future years.
2. Staffing and training of new staff is a challenge given the level of additional funding. The program is working quickly to hire additional staff.
3. The Build America, Buy America Act (BABA) applies to BIL funding, and requires  that all construction materials and manufactured products are made in the United States. Additional federal regulations such as BABA may slow funding awards and may be a challenge for projects to comply with. 

We share a collective commitment with local governments to protect public health and ensure safe tap water for all. The BIL funding can help us move forward toward that goal. Contact us if your community is interested in pursuing this funding. Thank you.

➽ Mark Henderson, P.E. Unit Manager, Grants and Loans

➽ Michael Beck Section Manager Community Development & Partnership 

➽ Ron Falco, P.E. Safe Drinking Water Program Director

2023 State Revolving Fund Eligibility Survey Open June 1 - June 30, 2022

This survey is conducted on an annual basis by the Colorado Department of Public Health and Environment’s Water Quality Control Division. The survey is used to identify water and sewer infrastructure improvements, as well as stormwater and non-point source needs, that are eligible for funding through the Drinking Water Revolving Fund (DWRF) and Water Pollution Control Revolving Fund (WPCRF) grants and loans programs. All municipalities, counties, districts, public water systems, not-for-profit water systems and other special districts that own or operate public water, sewer, or stormwater systems in the State of Colorado are encouraged to participate.

The survey will remain open from June 1st through the submittal deadline of June 30th.

Resources: 

• The Division’s SRF website: DWRF and WPCRF program details, survey instructions and other useful information regarding the annual survey.
• After reviewing the division website create a profile on the Colorado Environmental Online Services (CEOS) portal and begin your SRF Eligibility Survey 
• Opt into the division’s notification service to receive timely information about SRF and other funding opportunities available through both State and Federal sources.
• If you have questions or require any assistance with the CEOS portal or the eligibility surveys, contact the Grants and Loans Unit at CDPHE_grantsandloans@state.co.us or Erick Worker at erick.worker@state.co.us.

Important:

• Entities must submit an eligibility survey and be on the Eligibility List to be eligible for funding. 
• Entities currently identified on the existing 2022 DWRF and WPCRF Appendix A - Project Eligibility Lists, are eligible to receive BIL funding in 2022 for the water and sewer infrastructure needs listed. See below for more information regarding BIL funding.
• Entities not on the current project eligibility lists will need to complete and submit the eligibility survey through the CEOS portal no later than June 30, 2022, to be added to the 2023 project eligibility lists for BIL funding.
• The surveys have been updated to include sections regarding lead service line replacement needs and emerging contaminants treatment needs. Please remember to complete those sections if you have a funding need for those projects.

Eligible projects can secure competitive, low interest loans with repayment terms of up to 30 years. Completion of a survey is the first simple step towards obtaining funding. It is not an application and it does not obligate an entity to apply for financial assistance; however, identifying capital improvement needs through the Eligibility Survey is a required prerequisite of securing funding offered through the DWRF and WPCRF programs. Loans and grants cannot be extended to applicants who have not responded to this important survey.

The Bipartisan Infrastructure Law (BIL), previously referred to as the Infrastructure Investment and Jobs Act (IIJA), was signed into law on November 15, 2021. The BIL invests more than $50 billion nationally over the next five years in EPA water infrastructure programs including the SRF. Colorado’s first year allotment for the DWRF and WPCRF programs totals approximately $121 million. 

BIL funding will be issued as both loans and additional subsidization in the form of principal forgiveness. Entities seeking BIL funding must be eligible under the existing DWRF and WPCRF programs. Additional subsidization is available to eligible entities that meet the BIL Principal Forgiveness Eligibility Criteria described in the proposed addendum to the 2022 Intended Use Plan. BIL also offers dedicated funding to replace lead service lines and emerging contaminants such as PFAS (per- and polyfluoroalkyl substances).

➽ Erick Worker, Project Manager, Water Quality Control Division, Grants and Loans Unit

Lead testing in Schools and Child Care Facilities Drinking Water Program

Applications Now Available

Applications and program updates will be available on our lead in schools website.

Questions? Please email us at cdphe_wqcd_lead_grant@state.co.us

In January of this year (2022) the Water Quality Control Division (Division) launched the lead testing in schools and child care facilities drinking water program. This is an EPA-funded program administered by the Division and is an important opportunity to take action now and target lead testing for our most vulnerable populations. Infants and young children are most at risk, but many schools and child care facilities have not been tested for lead in their drinking water. While this is a voluntary program, we encourage public health officials to apply now and take advantage of this opportunity to partner with the Division and enhance community, parent, and teacher trust in their drinking water. 

We will be accepting applications from local public health agencies, or other county agencies to participate in the program. The ideal funding strategy is to work with our local public health and county partners to implement this program. However, if local public health and county agencies are unable to implement the program in their jurisdiction, the Division may fund public water systems to assist in these community efforts.

The program involves a holistic approach per the EPA’s 3Ts guidance beginning with outreach and education in the first phase that leads into sampling, testing, and taking action in the second phase. We will provide grant recipients outreach materials, including school and child care facility information, in addition to training and detailed instructions for developing sampling plans at each participating facility. This funding currently does not cover remediation efforts; however, low-cost immediate action is possible if elevated lead levels are found as described in our sampling guidance. These actions include shutting off the source, fixture replacement, cleaning the faucet aerator/ screen, routine monitoring, and performing common practices to reduce lead levels in drinking water:

Common Practices to Reduce Lead in Drinking Water:

• Let your water run before drinking.
• If it has not been used for several hours, run the cold water tap until the temperature is noticeably colder. Sometimes it can take two minutes or longer. This flushes lead-containing water from the pipes.
• Always use cold water for drinking and cooking.
• Never cook or drink water with water from the hot water tap. Hot water can be more corrosive and lead from plumbing can get into the water. Boiling does not remove lead from the water.
• Periodically remove and clean the faucet’s strainer/aerator.
• While removed, run water to remove debris.
• Consider using a water filter certified to remove lead and know when it’s time to replace.
• Verify the claims of manufacturers by checking to make sure that filters are listed as NSF International standard 42 and 53. Look for certified drinking water treatment units by searching for lead in drinking water at www.nsf.org.

Community public water systems are encouraged to engage with their local public health agency and local government to raise awareness of this grant and lead testing program. This is a great opportunity for community public water systems to proactively identify the schools and child care facilities they serve and familiarize themselves with the sampling process and lead service line inventory that will be required per the Lead and Copper Rule Revisions.

The current program has two required phases. The first phase provides up to $5,000 to help with community outreach. The second phase provides up to $25,000 to sample for lead in drinking water at participating schools and child care facilities. The cost of laboratory testing for lead will be funded through this grant in addition to the $30,000 available to eligible applicants.

➽  Laura Leonard PhD, Lead Testing Program Coordinator