The Drinking Water State Revolving Fund (DWSRF) was created in 1996 as a result of the New York State enactment of the Clean Water/Clean Air Bond Act, as well as the passage of the 1996 amendments to the Safe Drinking Water Act by the U.S. Congress. The DWSRF, jointly administered by EFC and the New York State Department of Health, provides a financial incentive for municipally and privately owned public water systems to undertake needed drinking water infrastructure improvements.
This program provides market-rate and below market-rate financing for the construction of certain eligible public water system projects for the protection of public health. For qualifying communities with demonstrated financial hardship, interest rates can be reduced to zero percent and grants may be provided.
Since its inception in 1996, the DWSRF program has provided $5.72 billion in financings to assist public water systems throughout the state, including the provision of $345 million in grant funds to disadvantaged communities. These financings and grants have assisted 409 public water systems with protecting public health by making needed drinking water system infrastructure projects more affordable for residents throughout New York State.
- Municipalities, including any county, city, town, village, district corporation, county or town improvement district, school district, Indian nation or tribe recognized by the State or the United States with a reservation wholly or partly within the boundaries of New York State, any water authority now existing in a city, or any agency of New York State which is empowered to construct and operate an eligible project, or any two or more of the foregoing which are acting jointly in connection with an eligible project.
- Community water systems, both public and privately-owned, and non-profit, non-community water systems.
Projects eligible for DWSRF financing include investments to upgrade or replace infrastructure needed to achieve or maintain compliance with federal or state health standards, and provide the public with safe, affordable drinking water.
Examples of such projects include:
- Rehabilitation or development of new drinking water sources to replace contaminated supplies.
- Installation or upgrade of treatment facilities to ensure compliance with state and federal drinking water standards or treatment/performance criteria.
- Installation or upgrade of storage facilities, including finished water reservoirs, to prevent microbiological contamination or to provide adequate delivery pressures.
- Installation or replacement of transmission and distribution mains to prevent contamination caused by leaks or breaks.
- Funding and/or construction to promote the consolidation of water supply services, particularly in circumstances where individual homes or water systems generally have an inadequate quantity of water, the water supply is contaminated, or the system is unable to maintain adequate compliance for financial or managerial reasons.
- The purchase of a portion of another system if the purchase is part of a consolidation plan to bring the system(s) into compliance.
- Capital investments to improve the security of drinking water systems.
EFC offers short-term financing for a period of up to five years to provide recipients with funding sources to design and initiate construction on SRF eligible projects. Short-term financings can be used to pre-finance costs that will be reimbursed from proceeds from other sources of funds, however only market-rate financing can be used to pre-fund any awarded grants. Interest accrues only on balances drawn.
Types of short-term financing available from EFC include:
- Hardship: Drinking Water applicants that qualify for hardship may receive a short-term interest-free financing for 100% of SRF eligible project costs or IUP listing amount, whichever is less. For information on EFC’s hardship policy, including eligibility criteria and limitations, click here.
- Subsidized Financing: Drinking Water applicants that do not qualify for hardship but have a project listed on the annual list with a score above the subsidy line may receive a short-term subsidized financing, consisting of an interest-free financing for 33 1/3% of the SRF eligible project costs or IUP listing amount, whichever is less, and a short-term market-rate financing for the remaining SRF eligible project costs. There is a 0.6% administrative fee on the interest-free portion of the financing.
- Market-Rate Financing: Drinking Water applicants that do not qualify for hardship or subsidized financing may receive a low-cost short-term market-rate for 100% of SRF eligible project costs or IUP listing amount, whichever is less. The interest rate on short-term market rate financings is set based on the MMD AAA Market-Rate 1-year rate plus EFC cost of funds.
EFC offers long-term financing to recipients for SRF eligible projects. Long-term financing are generally available for terms of up to 30 years.
Types of long-term financing available from EFC include:
- Hardship: Drinking Water applicants that qualify for hardship may receive a long-term interest-free financing for 100% of SRF eligible project costs or IUP listing amount, whichever is less. For information on EFC’s hardship policy, including eligibility criteria and limitations, click here.
- Long-Term Subsidized Financing: Drinking Water applicants that do not qualify for hardship but have a project listed on the annual list with a score above the subsidy line may qualify for a long-term subsidized financing. These financings are at AAA/aaa borrowing rates, plus a 33 1/3% subsidized interest rate. There is a State Bond Issuance Charge, Direct Expense, 0.11% Annual Administrative Fee, and a 1.1% Program Administration Fee for these financings. The Annual Administrative Fee is calculated on the outstanding balance.
- Long-Term Market-Rate Financing: Long-Term Market-Rate financings may be available to support eligible projects that are listed on the annual list with a score below the subsidy line. Projects closed with a Long-Term Market Rate financing will remain eligible for subsidized funding for up to 5 years from the long-term closing date, and these projects will remain on the Annual Project Priority List during this period. Long-Term Market-Rate financings include a direct expense and the State Bond Issuance Charge.
EFC is committed to promoting participation opportunities for New York State ("State") certified minority- and women-owned business enterprises ("MWBEs") and federal disadvantaged business enterprises ("DBEs"), and equal employment opportunities ("EEO") for minority group members and women in the performance of EFC contracts as well as contracts that receive financial assistance through EFC's various programs.