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Report to the Subcommittee on Interior, Environment, and Related
Agencies, Committee on Appropriations, House of Representatives:
United States Government Accountability Office:
GAO:
June 2006:
Clean Water:
How States Allocate Revolving Loan Funds and Measure Their Benefits:
GAO-06-579:
GAO Highlights:
Highlights of GAO-06-579, a report to the Chairman and Ranking Member,
Subcommittee on Interior, Environment, and Related Agencies, Committee
on Appropriations, House of Representatives.
Why GAO Did This Study:
Communities will need hundreds of billions of dollars in coming years
to construct and upgrade wastewater treatment facilities, sewer
systems, and other water infrastructure. To finance these efforts, they
will rely heavily on low-interest loans from the Environmental
Protection Agency’s (EPA) Clean Water State Revolving Fund (CWSRF)
program to supplement their own funds. Through fiscal year 2005, states
have used their CWSRFs to provide communities over $52 billion for a
variety of water quality projects. The Clean Water Act allows states to
use their CWSRFs to (1) construct or improve conventional wastewater
infrastructure, (2) control diffuse (nonpoint) sources of pollution
such as agricultural runoff and leaking septic systems, and (3) protect
federally-designated estuaries.
Given the states’ flexibility in determining how to spend CWSRF
dollars, GAO was asked to examine (1) the extent to which states use
their CWSRF dollars to support conventional wastewater treatment
infrastructure versus other qualifying expenses, (2) the strategies
states use to allocate their CWSRF dollars among qualifying expenses,
and (3) the measures states use to ensure that their allocation
strategies result in the most efficient and effective use of CWSRF
dollars. EPA reviewed a report draft, providing technical comments that
were incorporated.
What GAO Found:
Since 1987, states have used 96 percent (about $50 billion) of their
CWSRF dollars to build, upgrade, or enlarge conventional wastewater
treatment facilities and conveyances. Projects to build or improve
wastewater treatment plants alone account for over 60 percent of this
amount, with the remainder supporting the construction or
rehabilitation of sewer and storm water collection systems. CWSRF
assistance for nonpoint source activities represents only 4 percent
(about $2 billion) of CWSRF dollars, although it accounts for over a
quarter of all CWSRF projects financed. To date, 37 states report using
some portion of their CWSRF funds to directly support nonpoint source
activities. Nationwide, 23 percent of CWSRF funds (64 percent of all
CWSRF loan agreements) were devoted to water quality projects in
communities with populations of less than 10,000 people.
The 50 states (and Puerto Rico) have used a variety of strategies to
allocate CWSRF funds to meet their individual needs. For example, the
state of Washington sets aside 20 percent of its CWSRF dollars to
support nonpoint source projects, while Alabama state law defines only
traditional public wastewater treatment facilities as appropriate
projects under its CWSRF program. Other states have designed their
programs to target selected types of borrowers. Pennsylvania, for
example, has targeted borrowers in small or rural communities during
the allocation process. According to EPA and state officials, states’
allocation strategies may change as certain states’ priorities and
clean water needs shift. Among the reasons are (1) aging wastewater
infrastructure in need of rehabilitation or replacement; (2) population
growth and redistribution; (3) changes in EPA enforcement priorities;
and (4) stricter EPA and state water quality standards for temperature,
nutrients, and sediments.
EPA and the states use a uniform set of financial and environmental
measures to help determine efficient and effective use of CWSRF
resources. Financial measures include, among others, return on federal
investment, the pace at which available funds are loaned, and the
sustainability of the fund. EPA regional officials conduct annual
reviews of each state program to help ensure the fiscal integrity of
the state programs. All programs are also subject annually to
independent financial audits. To measure environmental outcomes of
CWSRF-funded projects, in fiscal year 2005, EPA developed an electronic
benefits reporting system that all 51 programs have agreed to use.
Currently, the system collects data only on anticipated environmental
benefits associated with CWSRF-funded projects. However, to varying
degrees, some states such as Oklahoma and Washington are attempting to
gather data on actual environmental benefits from their CWSRF-funded
projects, including nonpoint source projects.
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-579].
To view the full product, including the scope and methodology, click on
the link above. For more information, contact John Stephenson at (202)
512-3841 or stephensonj@gao.gov.
[End of Section]
Contents:
Letter:
Results in Brief:
Background:
States Have Loaned 96 Percent of Their CWSRF Funds for Wastewater
Infrastructure, with 23 Percent Supporting Projects in Small
Communities:
States' Allocation Strategies Reflect Diverse Clean Water Needs and
CWSRF Program Goals:
EPA and the States Use Specific Financial and Environmental Measures to
Evaluate Efficient and Effective Use of CWSRF Resources:
Agency Comments and Our Evaluation:
Appendix I: Scope and Methodology:
Appendix II: Selected Clean Water State Revolving Fund Financial Data:
Appendix III: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: States Voluntarily Reporting Use of CWSRFs to Address Nonpoint
Sources of Water Pollution with a Wastewater Treatment System, Fiscal
Years 1987 through 2005:
Table 2: Clean Water State Revolving Fund for Wastewater Treatment,
Nonpoint Source, and Estuary Projects, by State, Fiscal Years 1987
through 2005:
Table 3: Clean Water State Revolving Fund Assistance by Community Size,
Fiscal Years 1987 through 2005:
Table 4: Clean Water State Revolving Fund National Financial
Indicators, Fiscal Years 1987 through 2005:
Table 5: Clean Water State Revolving Funds Available for Projects,
Fiscal Years 1987 through 2005:
Table 6: Assistance Provided Through the Clean Water State Revolving
Fund Program and Other State Funded Clean Water and Loan Grant
Programs, Fiscal Years 1987 through 2005:
Figures:
Figure 1: Flow of Funds through the CWSRF Program:
Figure 2: CWSRF Support and Type of CWSRF-Supported Projects, Fiscal
Years 1987 through 2005:
Figure 3: CWSRF Financial Assistance by Subcategory of Wastewater
Infrastructure Projects, Fiscal Years 1987 through 2005:
Figure 4: CWSRF Support for Wastewater Infrastructure and Nonpoint
Source Pollution Control Projects, Fiscal Years 1987 through 2005:
Figure 5: CWSRF Support for Nonpoint Source Projects as a Percentage of
Total CWSRF Support, Fiscal Years 1987 through 2005:
Figure 6: CWSRF Support by Subcategory of Nonpoint Source Projects,
Fiscal Years 1987 through 2005:
Figure 7: CWSRF Support by Community Size as a Percentage of Total
CWSRF Support, Fiscal Years 1987 through 2005:
Figure 8: CWSRF Support to Small Communities as a Percentage of Total
CWSRF Support, Fiscal Years 1987 through 2005:
Figure 9: Annual Average Interest Rates for the Clean Water State
Revolving Fund Compared with Annual Average Market Interest Rates:
Abbreviations:
CBO: Congressional Budget Office:
CSO: Combined Sewer Overflows:
CWSRF: Clean Water State Revolving Fund:
EPA: Environmental Protection Agency:
GAAP: Generally Accepted Accounting Principles:
IPPS: Integrated Project Priority Setting:
NIMS: National Information Management System:
OMB: Office of Management and Budget:
PART: Program Assessment Rating Tool:
PER: Program Evaluation Report:
SSO: Sanitary Sewer Overflows:
TMDL: Total Maximum Daily Load:
United States Government Accountability Office:
Washington, DC 20548:
June 5, 2006:
The Honorable Charles H. Taylor:
Chairman:
The Honorable Norm Dicks:
Ranking Minority Member:
Subcommittee on Interior, Environment, and Related Agencies:
Committee on Appropriations:
House of Representatives:
Recent estimates by the Environmental Protection Agency (EPA) and the
Congressional Budget Office suggest that, over the next 15 years, local
communities will need hundreds of billions of dollars to construct and
upgrade aging wastewater treatment facilities, sewer systems, and other
projects that improve water quality and help safeguard public health
and the environment. These communities will rely on EPA's Clean Water
State Revolving Fund (CWSRF) to supplement the funds they obtain from
their ratepayers to finance these efforts. The Water Quality Act of
1987 amended the Clean Water Act[Footnote 1] and created the CWSRF
program to provide an independent, permanent, low-cost source of
financing for a wide range of efforts to protect or improve water
quality. Through the CWSRF, EPA provides annual grants to the states to
capitalize state-level CWSRFs. States must match these EPA grants with
a minimum of 20 percent of their own contributions. States loan their
CWSRF dollars to local governments and other entities for various water
quality projects, and loan repayments are cycled back into the state-
level programs to fund additional projects. According to the EPA, all
50 states and Puerto Rico currently maintain revolving loan funds that
have provided an average of over $4 billion in total annual assistance
since 2000.[Footnote 2] From fiscal years 1987 through 2005, state
CWSRFs have provided over $52 billion and made over 16,000 loans for a
variety of water quality projects.
The CWSRF provides states with significant flexibility to design
programs to meet their water quality needs. States may use their CWSRF
resources to (1) construct or improve conventional wastewater
infrastructure, such as treatment plants and sewer systems; (2) control
diffuse, or "nonpoint" sources of pollution, such as runoff from
agricultural activities and leaking septic systems; and (3) develop or
implement management plans in federally-designated estuaries. Although
the CWSRF is primarily a low-interest loan program, states can also use
it to refinance, purchase, or guarantee local debt and purchase bond
insurance. States may customize their loan terms, including interest
rates (from 0 percent to market rates) and repayment periods (up to 20
years), depending on the financial and environmental needs of potential
borrowers. EPA provides a range of financial and programmatic training
and direct technical support to the states through its regional
offices.
Citing the states' flexibility in determining how to use their CWSRFs,
you asked that we examine (1) the extent to which states are currently
using their CWSRF dollars to support conventional wastewater treatment
infrastructure versus other qualifying expenses, (2) the strategies
states use to allocate their CWSRFs among qualifying expenses, and (3)
the measures states use to ensure that their allocation strategies
result in the most efficient and effective use of their CWSRFs.
To determine the extent to which states are currently using their
CWSRFs to support conventional wastewater infrastructure versus other
qualifying expenses, we reviewed EPA's National Information Management
System, the database EPA uses to track expenditures for all 51 CWSRF
programs. To examine the strategies states use to allocate their CWSRFs
among qualifying expenses, we interviewed EPA and state-level agency
officials and reviewed annual reports and other official documents. We
conducted field visits to a diverse group of states--including
Delaware, Minnesota, Montana, North Carolina, Ohio, Texas, and
Washington--to obtain detailed illustrative information about CWSRF
allocation strategies from state-level CWSRF program officials and
selected recipients of CWSRF funds. To gather information on additional
states, we conducted structured phone interviews with EPA officials
from all 10 regional offices and followed up with selected state-level
CWSRF program officials to discuss allocation strategies and other
aspects of their programs. We also reviewed each state's most recent
CWSRF Program Evaluation Report (PER), which EPA conducts annually. To
examine how states ensure that their allocation strategies result in
the most efficient and effective use of CWSRF dollars, we interviewed
EPA and state officials about the financial and environmental measures
they use to assess CWSRF performance. In addition, we reviewed EPA's
online CWSRF Environmental Benefits Reporting System. We conducted our
work between July 2005 and April 2006 in accordance with generally
accepted government auditing standards. See appendix I for a more
detailed discussion of our scope and methodology.
Results in Brief:
Since the inception of the CWSRF program in 1987, states have allocated
about 96 percent, or about $50 billion, of their CWSRF dollars to
building, upgrading, or enlarging conventional wastewater treatment
facilities and their associated conveyances. Projects to build or
improve wastewater treatment plants alone account for over 60 percent
of this amount, with the remainder supporting the construction or
rehabilitation of sewer and storm water collection systems. In addition
to these more conventional expenditures, 37 states report using some
portion of their CWSRFs to address nonpoint source pollution, which
sometimes account for serious pollution problems. Nonpoint source
projects account for only 4 percent of CWSRF expenditures (about $2
billion) but represent more than 25 percent of all CWSRF projects
financed. Among all categories of CWSRF-eligible nonpoint source
projects, states provided the greatest level of support--about 39
percent of all nonpoint source dollars--to activities related to
sanitary landfills. Nationwide, 23 percent of CWSRF funds, or 64
percent of all CWSRF loan agreements, were targeted for water quality
projects in communities of less than 10,000 people. A number of states,
such as North Carolina, Pennsylvania, and West Virginia, have developed
special initiatives or customized their loan terms to help small or
economically disadvantaged communities develop needed wastewater
infrastructure.
As allowed by the Clean Water Act, states have used considerable
flexibility in designing their CWSRF programs to meet their individual
clean water needs. In particular, states choose the extent to which
they will use CWSRF funds to support point source control projects
(e.g., wastewater treatment plant construction) and nonpoint source
projects (e.g., implementing agricultural best management practices or
replacing failing septic systems). The state of Washington, for
example, uses up to 20 percent of its CWSRF dollars for a set-aside to
support nonpoint source projects and estuary conservation and
management projects, while Alabama state law defines only traditional
public wastewater treatment facilities as appropriate projects under
its CWSRF program. Just as some states allocate CWSRF resources based
upon identified water quality needs, other states have designed their
programs to target selected types of borrowers. For example,
Pennsylvania has targeted borrowers in small or rural communities
during the allocation process, with 90 percent of all CWSRF loan
agreements and almost 75 percent of total funding is directed to
projects in small communities. Similarly, Ohio offers CWSRF loans with
(1) a 0 percent interest rate to communities with populations of less
than 2,500 and a median household income of less than $45,000 and (2) a
1 percent interest rate to those with populations between 2,500 and
10,000 and a median household income of less than $38,000. According to
EPA and state officials, states' allocation rationales may change as
certain states' priorities and clean water needs shift. Specifically,
states may alter their allocation strategies in response to (1) aging
wastewater infrastructure needing rehabilitation or replacement; (2)
population growth and redistribution; (3) changes in EPA enforcement
priorities, particularly with regard to limiting sewage discharges
during wet weather conditions; (4) pressure to implement EPA's Total
Maximum Daily Load (TMDL) program; and (5) stricter EPA and state water
quality standards for temperature, nutrients, and sediments.
States use a specific set of financial and environmental measures to
help determine efficient and effective use of CWSRF resources.
Financial measures include a set of national financial indicators, such
as return on federal investment, the pace at which available funds are
loaned, and sustainability of the CWSRF. EPA regional officials conduct
annual reviews of each state program to help ensure the fiscal
integrity of the state programs. CWSRFs are also subject to annual
independent financial audits. To measure environmental outcomes of
CWSRF-supported projects, in fiscal year 2005, EPA developed an
electronic benefits reporting system, which all states have agreed to
use. Currently, the system collects data on anticipated environmental
benefits associated with all types of CWSRF projects. It does not
require any environmental monitoring, since the information input
focuses on anticipated environmental benefits. However, some states are
attempting to gather data on actual environmental benefits from their
CWSRF-supported projects, including nonpoint source projects.
Washington State, for example, recently required applicants to monitor
the environmental impact of its CWSRF projects 3 to 5 years after
project completion.
Background:
Local governments have primary responsibility for wastewater treatment,
owning and operating more than 17,000 treatment plants and 24,000
collection systems nationwide. Local ratepayers have long been relied
upon to fund both construction costs and operating and maintenance
costs associated with facilities serving their communities. However,
the federal government has provided financial assistance for these
wastewater treatment facilities since the enactment of the Water
Pollution Control Act Amendments of 1956, which established the federal
Construction Grants program. Through this program, the federal
government provided grants directly to local governments for
constructing treatment facilities but limited the federal contribution
to the lesser of 30 percent of eligible construction costs or $250,000.
The Federal Water Pollution Control Act Amendments of 1972, commonly
known as the Clean Water Act, increased the federal share of costs to
75 percent. According to the Congressional Budget Office, federal
outlays for wastewater treatment grants rose tenfold during the 1970s,
reaching a high of $8.4 billion in 1980. Subsequent amendments in 1981
and 1987 reduced and then phased out the construction grant program,
replacing it with the CWSRF. Instead of providing grants directly to
localities, the CWSRF provides federal grants to the states, which in
turn provide loans to communities and other entities to finance
wastewater treatment and other water quality projects.[Footnote 3] The
1987 law established a system in which the states would use the loan
repayments to finance future CWSRF loans, thereby allowing the state
revolving funds to operate without sustained federal support. Congress
authorized appropriations through 1994 but has continued to appropriate
funds to the CWSRF each year since.
The transfer of federal funds to state-level CWSRFs begins when
Congress appropriates funds annually to the EPA. EPA then allots
capitalization grants to the individual states. The Clean Water Act
also requires states to provide state funds to match 20 percent of the
total federal CWSRF capitalization grants. To receive its allotment, a
state must provide an Intended Use Plan that lists potential projects
to solve water quality problems and solicit public comments on that
list. After completing the plan and receiving its capitalization grant,
a state has up to 1 year to enter binding commitments (later converted
into loan agreements) with potential borrowers to fund specific water
quality projects. The majority of CWSRF borrowers are municipalities
and other local units of government, although in some states nonprofit
organizations, businesses, farmers, homeowners, and watershed groups
are eligible to seek nonpoint source funding through the
CWSRF.[Footnote 4]
According to an EPA headquarters official, a single CWSRF loan may
support multiple clean water projects.[Footnote 5] State CWSRF
administrators set loan terms, interest rates, and repayment periods.
Loan repayments are cycled back into the state-level fund and used for
additional water quality projects. States also have the option of using
CWSRF funds as collateral to borrow in the public bond market to
increase the pool of available funds, a process referred to as
"leveraging." Figure 1 illustrates the flow of funds through the CWSRF
program.
Figure 1: Flow of Funds through the CWSRF Program:
[See PDF for image]
[A] To date, 27 states have "leveraged" their federal capitalization
grants and state matching funds to borrow additional money in the
public bond market. Nationally, leveraged bonds comprise about 27
percent of total CWSRF funds, while loan repayments comprise about 10
percent.
[End of figure]
States can use their CWSRF resources to construct or upgrade wastewater
infrastructure, address nonpoint sources of pollution,[Footnote 6] or
develop or implement management plans in federally-designated
estuaries. States use a state-developed, EPA-approved, ranking system
to direct funds to the highest priority projects. The ranking system
considers applicant communities' current regulatory compliance status,
imminent public and environmental health threats, and the relative
importance of the affected bodies of water. States are not required to
fund these projects in priority order; decisions on which projects to
fund first are often based on a project's readiness to proceed.
However, states must first use their CWSRFs to ensure that existing
wastewater treatment facilities are in compliance with, or are making
progress toward, deadlines, goals, and requirements of the Clean Water
Act.[Footnote 7] After meeting this "first use" requirement, states may
use their CWSRFs to construct other wastewater infrastructure or for
nonpoint source pollution and estuary management projects.[Footnote 8]
States Have Loaned 96 Percent of Their CWSRF Funds for Wastewater
Infrastructure, with 23 Percent Supporting Projects in Small
Communities:
Taken together, states have loaned the majority of their CWSRF dollars
--96 percent or about $50 billion since 1987--to build, upgrade, or
enlarge conventional wastewater treatment facilities and conveyances.
Direct CWSRF support for nonpoint source activities represents only 4
percent of CWSRF dollars (about $2 billion), although it accounts for
over a quarter of all CWSRF projects financed. Nationwide, 23 percent
of CWSRF funds (64 percent of all CWSRF loan agreements) were devoted
to water quality projects in communities with populations of less than
10,000 people.
States Have Used about 96 Percent of Their CWSRFs to Support
Conventional Wastewater Infrastructure Projects:
All 51 CWSRF programs use the large majority of their CWSRF resources
for conventional wastewater infrastructure projects. From fiscal year
1987 through June 2005, the Clean Water State Revolving Fund program
has provided over $52 billion dollars in financial assistance to local
governments and others for a variety of water quality improvement
projects across the nation. States provided about 96 percent of this
amount--or $50 billion--to municipalities to build, upgrade, or enlarge
conventional wastewater treatment facilities and conveyances. EPA
reports that conventional wastewater infrastructure projects account
for about 73 percent of all CWSRF-funded projects. By their nature,
wastewater infrastructure projects are typically much more expensive to
complete than nonpoint source projects. Figure 2 illustrates the
relative funding for the types of projects receiving CWSRF assistance.
Figure 2: CWSRF Support and Type of CWSRF-Supported Projects, Fiscal
Years 1987 through 2005:
[See PDF for image]
Note: According to EPA, as of June 30, 2005, no state has reported
using CWSRF resources to directly support projects that are exclusively
fundable under the estuary management category of qualifying expense
(such as fish restocking).
[A] Total CWSRF funding equals $52.7 billion. According to EPA, $600
million of available CWSRF resources support short-term planning and
design activities and, as such, have not yet been allocated by the
states among the qualifying categories of expense. However, EPA expects
that these funds will be allocated (most likely to wastewater
infrastructure projects) when rolled into longer-term construction
projects.
[B] According to EPA, states have reported that their CWSRF loans have
supported a minimum of 22,674 projects, but because states do not use
common standards to report the numbers of projects supported by loan
agreements, the percentage of projects that are point source versus the
percentage that are nonpoint source are imprecise, and the actual
percentages might be either higher or lower than reported above.
However, we were unable to quantify the extent of this imprecision.
[End of figure]
Within the conventional wastewater treatment category, states may
allocate their CWSRF resources among the following seven major
categories of projects:
* Secondary Treatment includes infrastructure designed to ensure that
wastewater treatment plant effluent meets EPA's secondary treatment
standards, a requirement of all new and existing wastewater treatment
facilities.
* Advanced Treatment includes infrastructure designed to further remove
nutrients and other matter from wastewater treatment plant effluent
beyond secondary treatment standards.
* New Sewers includes the construction of new wastewater conveyances--
such as collector and interceptor sewers--to carry household and
industrial wastewater to treatment facilities.[Footnote 9]
* Sanitary Sewer Overflow correction includes efforts to prevent the
occasional or incidental discharge of untreated sewage from municipal
sanitary sewer systems that can occur due to inclement weather and
improper maintenance or operation of sewer systems.[Footnote 10]
* Combined Sewer Overflow correction includes efforts to prevent or
mitigate discharges of untreated wastewater from combined sewer
systems, which are designed to collect rainwater runoff, domestic
sewage, and industrial wastewater in the same pipe. Combined sewer
systems were designed in many cities to occasionally discharge excess
wastewater directly to nearby water bodies. However such overflows
often pose significant public health and pollution problems and have
become a national enforcement priority for EPA.
* Storm Water Sewers includes both storm water infrastructure and
efforts to plan and implement municipal storm water management
programs.
* Recycled Water Distribution includes projects to convey recycled
water (i.e., treated wastewater) from treatment facilities to end users
such as golf courses and municipal gray water systems.
As shown in figure 3, nationwide, states have allocated about 60
percent of their CWSRF wastewater infrastructure dollars for secondary
and advanced treatment projects at wastewater treatment facilities. The
remainder supports sewers and other conveyances.
Figure 3: CWSRF Financial Assistance by Subcategory of Wastewater
Infrastructure Projects, Fiscal Years 1987 through 2005:
[See PDF for image]
Note: Percentages may not add to 100 due to rounding.
[A] Storm Water Sewers and Recycled Water Distribution together add to
less than one-half of 1 percent of CWSRF assistance for wastewater
infrastructure.
[End of figure]
Since the CWSRF's inception, the total dollar amounts that states
annually provide for wastewater infrastructure and nonpoint source
projects has increased. However, CWSRF support for wastewater
infrastructure has increased at a greater pace than the amount for
nonpoint source projects. Figure 4 shows that states have used their
CWSRFs to finance wastewater:
infrastructure projects since 1987 but only began to use them to
support nonpoint source projects in 1990. The annual percentage of the
CWSRFs states allocated to nonpoint source projects peaked in 1996 at
about 10 percent.
Figure 4: CWSRF Support for Wastewater Infrastructure and Nonpoint
Source Pollution Control Projects, Fiscal Years 1987 through 2005:
[See PDF for image]
[End of figure]
Nonpoint Source Projects Represent 4 Percent of CWSRFs but Account for
Over 25 Percent of All CWSRF-Supported Projects:
Direct CWSRF support for nonpoint source pollution control activities
represents only 4 percent (about $2 billion) of CWSRFs allocated by the
states but accounts for over 25 percent of all CWSRF-supported projects
because nonpoint source projects are typically less expensive than
wastewater infrastructure projects. The extent to which states have
used their CWSRFs to support nonpoint source projects varies. To date,
37 states have reported using some portion of their CWSRF funds to
directly support nonpoint source projects. Among them, Wyoming has
allocated the greatest percentage of funds to nonpoint source projects
(44 percent), while New York has allocated the greatest dollar amount
(over $700 million). Figure 5 illustrates the percentage of funding
that all 51 programs have allocated to nonpoint source projects since
the CWSRF's inception. Detailed state by state figures are provided in
appendix II.
Figure 5: CWSRF Support for Nonpoint Source Projects as a Percentage of
Total CWSRF Support, Fiscal Years 1987 through 2005:
[See PDF for image]
[End of figure]
To be eligible for CWSRF support, a nonpoint source pollution control
project must help implement a state's EPA-approved Nonpoint Source
Pollution Management Plan.[Footnote 11] Each state determines which
nonpoint source pollution control activities are eligible for funding.
Nationally, there are 11 major categories of nonpoint source pollution
control projects that have received CWSRF support:
* Agricultural Best Management Practices include projects to reduce
water pollution resulting from activities related to the production of
animals and food crops.[Footnote 12] Projects can include nutrient
management practices for the storage and disposal of animal waste;
techniques to minimize pollution related to agricultural activities
such as grazing, composting, pesticide spraying, planting, harvesting,
fertilizing, and tillage; and irrigation water management.
* Individual/Decentralized Sewage Treatment encompasses the
rehabilitation or replacement of individual septic tanks or community
sewage disposal systems. This category also includes the construction
of collector sewers to transport waste from individual septic systems
to a cluster septic tank or other decentralized facility.
* Groundwater-Unknown Source relates to the protection of groundwater
and includes projects to protect wellheads and prevent contamination in
areas where groundwater is replenished.
* Storage Tanks include tanks above or below ground designed to hold
petroleum products or chemicals. Projects may include spill containment
systems; the upgrade, rehabilitation, or removal of leaking tanks; and
the treatment of contaminated soils and groundwater.
* Sanitary Landfills manages water pollution emanating from landfills
and includes activities such as collection of leachate or on-site
treatment, capping, and closure.
* Silviculture includes best management practices related to forestry
activities such as timber harvesting, removal of streamside vegetation,
road construction, and mechanical preparation for the planting of
trees. Eligible activities include preharvest planning, streamside
buffers, road management, and re-vegetation of disturbed areas.
* Marina includes water pollution control activities related to boating
and freshwater marinas. Pump-out systems, oil containment booms, and
efforts to minimize discharge of sewage from boats are included in this
category.
* Resource Extraction includes pollution control activities related to
mining and quarrying. Projects supported can include the construction
of detention berms and the revegetation of areas affected by mining
activities.
* Brownfields include abandoned, idle, and underused industrial sites.
Eligible projects include groundwater monitoring wells, treatment of
contaminated soils and groundwater, capping of contaminated areas to
prevent storm water infiltration, and removal of storage tanks at
brownfields.
* Hydromodification relates to the water channel modification, dam
construction, stream bank and shoreline erosion, and wetland or
riparian area protection or restoration. Examples of eligible
activities include conservation easements; shore erosion control;
wetland development and restoration; installation of open, vegetated
drainage channels designed to detain and/or treat storm water; and bank
and channel stabilization.
* Urban includes activities related to erosion, sedimentation, and
discharge of pollutants (e.g., oil, grease, road salt, toxic chemicals)
from construction sites, roads, bridges, and parking lots.
As shown in figure 6, states have provided the greatest level of
nonpoint source support--almost 40 percent of all CWSRF nonpoint source
dollars--to mitigate contaminated runoff from sanitary landfills.
Figure 6: CWSRF Support by Subcategory of Nonpoint Source Projects,
Fiscal Years 1987 through 2005:
[See PDF for image]
Note: Percentages may not add to 100 due to rounding.
[A] Taken together, the Silviculture, Marina, Resource Extraction, and
Brownfields categories account for about 2 percent of CWSRF nonpoint
source dollars.
[End of figure]
Although sanitary landfill projects received the largest share of CWSRF
nonpoint source dollars, EPA reports that agricultural best management
practices account for over 55 percent of all CWSRF-supported nonpoint
source projects receiving CWSRF support. Agricultural best management
practices--such as constructing a manure retention pond to control
pollution created by contaminated storm water runoff--are typically
less expensive than other types of nonpoint source projects. EPA also
reports that the construction or repair of decentralized or
individualized wastewater treatment systems (i.e., septic systems)
accounted for about another one-third of all CWSRF-supported nonpoint
source projects.
Twelve states have reported to EPA that they have indirectly addressed
nonpoint sources of pollution with projects categorized under
wastewater treatment infrastructure. This may occur, for example, when
a state provides a loan to build a centralized collection system or
wastewater treatment plant to replace failing individual septic
systems, which EPA and the states define as a nonpoint source of water
pollution. Because the solution to the nonpoint source pollution
problem is technically a wastewater treatment facility, EPA considers
the expenditure to be in the wastewater infrastructure category. As
detailed in table 1, these 12 states have devoted at least $650 million
of their collective financing for wastewater infrastructure projects to
address nonpoint sources of pollution.
Table 1: States Voluntarily Reporting Use of CWSRFs to Address Nonpoint
Sources of Water Pollution with a Wastewater Treatment System, Fiscal
Years 1987 through 2005:
Dollars in millions.
State: Arizona;
Amount of wastewater assistance used to address nonpoint sources of
pollution: $140.6.
State: Delaware;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 59.3.
State: Indiana;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 39.6.
State: Kansas;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 4.9.
State: Massachusetts;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 12.2.
State: Minnesota;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 104.9.
State: New Mexico;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 0.6.
State: New York;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 81.3.
State: North Carolina;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 18.0.
State: Oregon;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 35.5.
State: Rhode Island;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 150.8.
State: South Carolina;
Amount of wastewater assistance used to address nonpoint sources of
pollution: 7.1.
State: Total;
Amount of wastewater assistance used to address nonpoint sources of
pollution: $654.7.
Source: EPA's National Information Management System.
Note: Numbers may not add to total due to rounding.
[End of table]
Smaller Communities Account for 23 Percent of CWSRF Dollars Loaned, but
Over 60 Percent of All CWSRF-Supported Projects:
Figure 7 shows that since the inception of the CWSRF program, small
communities--defined by EPA as having less than 10,000 inhabitants--
have received about 23 percent of total CWSRF dollars.[Footnote 13] In
contrast, over 60 percent of all CWSRF loan agreements supported
projects within these smaller communities.
Figure 7: CWSRF Support by Community Size as a Percentage of Total
CWSRF Support, Fiscal Years 1987 through 2005:
[See PDF for image]
Note: Percentages may not add to 100 due to rounding. EPA reports that,
as of June 30, 2005, total CWSRF financial assistance equals $52.7
billion and that the total number of CWSRF loan agreements equals
16,752. EPA does not collect data on the types of individual projects
(e.g., wastewater infrastructure or nonpoint source) or type of loan
agreement that each community receives.
[End of figure]
Figure 8 shows the considerable degree to which the states vary in the
extent to which their CWSRFs support small communities. It illustrates,
for example, that just over half of the CWSRF programs have provided 30
percent or more of their CWSRF funds for projects in small communities.
Pennsylvania has provided the greatest dollar amount ($914 million), as
well as a high percentage of loans (90 percent) to projects in small
communities. At the other end of the spectrum, California has provided
the lowest CWSRF dollar amount (4 percent) and loans (15 percent) for
projects in small communities.
Figure 8: CWSRF Support to Small Communities as a Percentage of Total
CWSRF Support, Fiscal Years 1987 through 2005:
[See PDF for image]
[End of figure]
States' Allocation Strategies Reflect Diverse Clean Water Needs and
CWSRF Program Goals:
Our interviews with state and EPA officials suggest that the diversity
states exhibit in their CWSRF spending reflects the variation in what
they see as their most pressing water quality infrastructure needs,
their most pressing water quality problems, and the degree to which
they rely on CWSRF funds to protect smaller communities. EPA and state
officials predict that, in future years, states are likely to alter
their current CWSRF allocation strategies in response to growing demand
and shifting clean water needs and priorities.
Some States Focus on Conventional Wastewater Problems:
Some states have focused their CWSRFs on supporting the construction of
wastewater treatment plants and conveyance systems. According to EPA
officials, these states consider wastewater infrastructure needs their
highest CWSRF priority and seek other sources of funding to support
nonpoint source pollution problems and estuary management activities.
In some cases, state legislation restricts the use of CWSRFs for
nonpoint source projects. For example, the legislation that created
Alabama's CWSRF limits the scope of the program by defining projects
that receive CWSRF funds as traditional public wastewater facilities.
Other states have passed legislation restricting the types of entities
that can receive CWSRF loans. Nevada and Colorado, for example, have
limited their CWSRF borrowers to local municipalities or similar
government entities, thereby excluding private or nongovernmental
entities from receiving CWSRF funds.
Even where state law allows CWSRF funds to be used for nonpoint source
projects, some state CWSRF administrators have told EPA officials that
they are not comfortable with using CWSRF funds for this purpose,
especially when demand for funding for wastewater infrastructure
projects in their states is high. For example, according to officials
in EPA's New York Regional Office, large parts of Puerto Rico lack
basic sewers and wastewater treatment facilities. Consequently, Puerto
Rico's CWSRF has focused on these needs. Similarly, according to
officials in EPA's Kansas City Regional Office, Kansas has focused on
wastewater treatment projects due to high levels of borrower demand for
support for these types of projects.
Some states that are willing and legally able to fund both wastewater
infrastructure and nonpoint source projects have not done so because of
low borrower demand for nonpoint source projects. Officials in EPA's
Dallas and Atlanta Regional Offices told us that Louisiana, Kentucky,
and New Mexico are willing to fund nonpoint source projects but have
not done so because of a lack of borrower demand. Similarly, North
Carolina and Texas CWSRF officials explained that groups that typically
implement nonpoint source projects often pursue grant money for their
projects from federal, state, or private sources rather than CWSRF
loans. CWSRF officials in states we visited indicated that nonpoint
source borrowers are often reluctant to accept a CWSRF loan because
they lack a dedicated source of revenue to repay it. While wastewater
treatment plants can depend on user rates for loan repayments, nonpoint
source borrowers may not have a readily available or dedicated source
of revenue to repay a loan. As such, these officials suggest that the
availability of grants through other federal-or state-funded programs
may affect the level of demand for CWSRF loans for nonpoint source
projects.
Most States Report Using Some of Their CWSRFs to Support Nonpoint
Source Projects:
As of June 2005, 37 states reported using some portion of their CWSRF
funds to support nonpoint source projects, up from only 2 states in
1990. The considerable progress in restoring the nation's waterways
since the passage of the Clean Water Act is largely attributable to
significant efforts to reduce pollutant levels from point sources of
pollution, which are those that contribute pollutants directly to a
body of water from a pipe or other conveyance. However, EPA reports
that one-third of the nation's assessed waters still do not meet water
quality standards. Recognizing the considerable role of nonpoint source
pollution in these standards violations, the majority of states have
decided to focus at least some attention on addressing these problems
with their CWSRF resources.
EPA has encouraged all states to use a watershed management approach to
solving water quality problems, which according to state and EPA
officials, has increased the number of states addressing nonpoint
source pollution with their CWSRFs.[Footnote 14] While traditional
water quality programs have focused on specific sources of pollution,
such as sewage discharges, or on specific water resources, such as a
river segment or a wetland, a watershed management approach addresses
water quality problems at the watershed level. According to officials
at EPA headquarters and several regional offices, this approach to
water quality management often highlights the role of nonpoint source
pollution in noncompliance issues. These officials suggested that
states using a watershed management approach are more likely to fund
nonpoint source projects with CWSRF resources. Additionally, CWSRF
officials in Ohio and Minnesota told us that developments in water
quality monitoring technologies and expansion of monitoring efforts
have helped their states better identify nonpoint sources of pollution.
According to these officials, the role of nonpoint source pollution in
noncompliance has been "uncovered" over the years as they have improved
monitoring efforts and as point sources of pollution--such as
wastewater treatment facilities--are brought into compliance.
Some states have been highly proactive in encouraging use of CWSRF
funds to support nonpoint source projects. For example, in an effort to
ensure that CWSRFs address nonpoint source problems, some states have
passed legislation setting aside a portion of their CWSRFs to be used
exclusively for nonpoint source projects. For example, Washington state
regulations require that CWSRF administrators reserve up to 20 percent
of available funds for nonpoint source pollution control and
comprehensive estuary conservation and management projects.
Other states have developed innovative lending approaches to overcome
some of the barriers to funding nonpoint source projects with CWSRF
resources. To increase the number of nonpoint source borrowers while
minimizing loan transaction costs, some states pass CWSRF loan risks
and loan servicing responsibilities onto third parties. These states
have established pass-through lending or linked-deposit programs,
whereby loans are passed through state agencies, municipalities, or
local banks before reaching the borrower. Minnesota's CWSRF program,
for example, works with the Minnesota Department of Agriculture to
allocate a portion of its funds to counties, soil and water
conservation districts, and others to help establish minirevolving loan
accounts. These local units of government work with local financial
institutions to provide low interest loans for projects proposed by
farmers, rural landowners, and agriculture supply businesses for
projects to implement, among other things, agricultural best management
practices. The local units of government approve eligible projects and
refer borrowers to the local financial institutions. Using CWSRF funds
from the minirevolving loan account, the bank provides low-interest
loans to qualified borrowers. The lending institution assumes the risk
and management responsibility for the loan. Other states--such as
Massachusetts and Missouri--have set up similar pass-through loan
programs to address nonpoint sources of pollution with CWSRF funds.
To overcome the challenge of finding a dedicated source of repayment
for nonpoint source projects, Ohio's Water Resource Restoration Sponsor
Program integrates CWSRF support for nonpoint source projects into
loans for wastewater treatment plants. According to Ohio CWSRF
officials, communities seeking a CWSRF loan for a wastewater treatment
facility can receive a discount to the interest payments that would
otherwise be due on their wastewater project loans. After the
wastewater facility loan has been awarded, the amount of the interest
discount is advanced to the community, which then assumes
responsibility for financing the implementation of the associated
nonpoint source project. In return, the community receives a reduction
to its wastewater facility loan's interest rate of up to 0.2 percent. A
community that participates in this program does not typically
implement the nonpoint source project itself. Rather, it enters into an
agreement with an implementing partner, such as a land trust or a park
district. Using the interest discount funds, this partner develops and
implements a nonpoint source project (such as a plan to restore and
permanently protect a waterbody's aquatic habitat resources) but does
not repay the CWSRF. Instead, the sponsoring community covers the cost
as part if its repayment of its wastewater facility loan.
According to Ohio officials, the benefit of the state's program is that
water restoration projects that may not normally receive CWSRF funding
are completed with the help of the wastewater treatment plants. Based
in part on the program's success, Ohio officials have decided to set
aside $15 million of CWSRF resources each year for their Water Resource
Restoration Sponsor Program. A few other states are in the process of
establishing similar sponsorship programs.
Some States Target Borrowers in Small or Economically Disadvantaged
Communities:
Just as states vary in the way they allocate CWSRF resources according
to water quality needs, they also vary in the extent to which they
target borrowers in small or economically disadvantaged communities.
Smaller communities may struggle more to raise capital for water
quality infrastructure than larger communities with broader tax and
rate bases. In 1992, Congress directed EPA to establish a Small Town
Environmental Planning Task Force to, among other things, advise EPA on
how to work better with small communities. The task force found that
technical and administrative capacity is often severely limited in
small towns, which often lack full-time officials and professional
staff. Moreover, the task force found that small communities tend to
have severely limited tax bases and budgets and, therefore, may not
have the necessary credit ratings to attract capital to finance their
wastewater infrastructure. In addition, infrastructure costs fall
disproportionately on small towns because entry-level costs must be
distributed over a smaller base.
Recognizing these challenges, some states--such as Montana,
Pennsylvania, and West Virginia--use their CWSRFs to help rural, low-
income communities meet required sewage and water quality standards. In
Pennsylvania, almost 90 percent of all CWSRF loan agreements and 75
percent of total funding is directed to projects in small communities.
Several states have set aside a portion of their funds for CWSRF-funded
projects in small or economically disadvantaged communities. For
example, Oregon reserves up to 15 percent of its CWSRF to support
projects in communities with populations of 5,000 or less that are
facing severe water quality problems. According to EPA and state
officials, some CWSRF programs have rules to protect the ability of
small communities to access CWSRF funds. For example, some states such
as New York and Minnesota have placed limits on the amount of CWSRF
support any one borrower--such as a major metropolitan area--can
receive in a given year.
A number of states offer small or economically disadvantaged
communities special assistance when applying for CWSRF loans. For
example, Ohio offers CWSRF loans with (1) a zero percent interest rate
to communities with populations of less than 2,500 and a median
household income of less than $45,000 and (2) a 1 percent interest rate
to those with populations between 2,500 and 10,000 and a median
household income of less than $38,000. West Virginia CWSRF
administrators are able to extend repayment terms up to 40 years to
qualified disadvantaged communities to help make projects more
affordable. Kentucky offers special state-funded, short-term loans to
small communities to help them cover expenses related to obtaining a
CWSRF loan. Montana has developed special outreach and technical
assistance programs to help small communities take advantage of the
CWSRF program. Montana officials explained that many small communities
lack the necessary administrative structures to receive a CWSRF loan or
lack the technical expertise to develop competitive applications for
CWSRF loans. The state has contracted with the Rural Community
Assistance Partnership, a nonprofit organization, to provide technical
assistance to rural and small communities to guide them through the
process of developing a competitive application and set up the
necessary administrative structures to receive a CWSRF loan. Officials
in several small Montana communities told us that, without this
technical assistance, they would not have been able to receive the
CWSRF loans that were critical to the financing of their wastewater
infrastructure.
Future State Allocation Strategies Will Likely Reflect Shifting
Priorities:
According to the EPA and state officials we interviewed, demand for
CWSRF support for both point and nonpoint source projects will grow
considerably in the future, and states will likely alter their CWSRF
allocation strategies in response to shifting clean water needs and
priorities. Among the factors these officials cite in predicting
changes in states' allocation strategies are (1) aging wastewater
infrastructure needing rehabilitation or replacement; (2) population
growth and redistribution; (3) changes in EPA enforcement priorities,
particularly with regard to limiting sewage discharges during wet
weather conditions; (4) pressure to implement EPA's TMDL program; and
(5) stricter EPA and state water quality standards for temperature,
nutrients, and sediments.
Officials in all 10 EPA regional offices and a number of state
officials told us that the need to repair or replace aging wastewater
infrastructure will be a major driver of future demand for CWSRF
resources. These officials point out that many of the wastewater
treatment plants and conveyances built with federal support in the
early 1970s in response to the passage of the Clean Water Act are now
reaching the end of their useful lives. EPA data indicate that
wastewater treatment plants typically have an expected useful life of
20 to 50 years before they require expansion or rehabilitation.
Wastewater conveyances such as pipes and sewers have life cycles that
can range from 15 to over 100 years. In addition, some wastewater
systems on the East Coast still rely on pipes that are almost 200 years
old. Taking into account the need to repair or replace these aging
systems, a 2002 Congressional Budget Office analysis estimated that
between 2000 and 2019, $260 to $418 billion will be needed for
wastewater infrastructure, while current spending is approximately $10
billion per year.[Footnote 15] CBO's analysis suggests that the gap
between current and needed spending could be as high as $11 billion per
year.
In addition to repairing or replacing existing infrastructure, EPA
officials predict that some states will face increased demand for new
wastewater treatment systems in response to population growth. In
addition to overall population growth, EPA also indicates that the
existing U.S. population is shifting geographically, requiring rapid
increases in wastewater treatment capacity in certain areas. EPA
officials indicated that some states in the West--such as Utah and
Nevada--and the South--such as Georgia and Florida--are already
experiencing rapid population growth and considerable pressure to
expand existing treatment capacity. In addition, EPA officials point
out that in the near-term, some states along the Gulf Coast will have
to balance the need for new growth with demand to replace or repair
wastewater infrastructure that was damaged by recent hurricanes.
In response to recent EPA wet weather policies and enforcement actions,
some state and EPA officials predict that a number of states will
experience increased demand for CWSRF assistance to address combined
sewer overflows (CSO), which are discharges of untreated wastewater
from a combined sewer system. Combined sewer systems collect and
transport both sanitary sewage and storm water runoff in a single-pipe
system to a wastewater treatment facility. Constructed prior to the
1950s, combined sewer systems exist in primarily older, urban
communities in the Northeast, Middle Atlantic, Midwest, and Northwest.
An overflow typically occurs when the total wastewater and storm water
flow exceeds the capacity of the system and, by design, discharges
directly into a receiving water body. Pollutants in CSOs have been
shown to be a major contributor to nonattainment of water quality
standards and may pose significant public health and pollution threats.
As such, EPA has selected these problems as national enforcement
priorities. Sixty percent of the more than 9,000 combined sewer systems
nationwide serve communities of fewer than 10,000 people---the very
communities that face some of the most difficulty in raising capital to
address environmental infrastructure. States have already used almost
$5 billion of CWSRF funds to correct CSOs, and EPA recently reported to
Congress that an additional $50 billion is required nationwide.
Officials in some Midwestern states--such as Michigan and Minnesota--
predict that addressing CSOs will be one of the biggest drivers of
demand and that funding these projects will become a higher priority in
the future. According to officials in EPA's Chicago and Atlanta
Regional Offices, some states facing major CSO problems--such as
Indiana and Kentucky--have indicated that the CWSRF will be a primary
source of funding for their long-term CSO management plans.
State and EPA officials also point out that demand for CWSRF support
for nonpoint source pollution control projects is likely to grow as
states begin projects to bring impaired waters into compliance with
EPA's TMDL program. A TMDL is a calculation of the total maximum amount
of a pollutant that a body of water can receive each day and still meet
water quality standards.[Footnote 16] Water quality standards are set
by states, territories, and tribes and identify the uses for each body
of water such as drinking water supply, contact recreation (swimming),
and aquatic life support (fishing). States generally determine if a
body of water is meeting standards by comparing monitoring data with
applicable state water quality criteria. If the body of water fails to
meet applicable federal, state, or local water quality, then the state
is required to list that water as impaired. EPA guidance provides that
the state should then develop a TMDL implementation plan that specifies
reductions necessary to achieve the standard and then eventually
implement a cleanup plan. According to EPA guidance, the state
implementation plan should specify which pollution sources will be
restricted to meet water quality standards. State and EPA officials
indicate that a majority of standards violations relate to nonpoint
sources of pollution and, subsequently, a number of TMDL projects
address nonpoint sources of water pollution. For example, Minnesota
CWSRF officials told us that they believe 86 percent of the pollution
in their impaired waters emanates from nonpoint sources of pollution.
According to some state and EPA officials, many states are considering
the CWSRF as a major source of funding, given the amount of resources
and the overall costs of implementing the plans.
In a similar vein, EPA and state officials also pointed out that
stricter federal, state, and local water quality standards will
continue to drive up demand for CWSRF loans for both point and nonpoint
source projects. For example, according to officials in EPA's
Philadelphia Regional Office, stricter biological and nutrient
standards in the recent Chesapeake Bay Agreement will drive demand for
CWSRF loans in Mid-Atlantic states. Officials in Minnesota told us they
are experiencing a surge in demand for CWSRF loans to repair or replace
individual failing septic systems due to greater attention and more
stringent enforcement by state and county regulators. EPA officials in
EPA's Seattle Regional Office point out that efforts to protect the
region's endangered salmon and bull head trout through the Endangered
Species Act may force wastewater treatment plants to upgrade their
treatment efforts and local municipalities to address nonpoint sources
of pollution. These officials predict that tougher temperature and
sediment standards in waters receiving effluent will drive demand,
especially for nonpoint source projects, in states such as Washington,
Idaho, and Oregon.
EPA and the States Use Specific Financial and Environmental Measures to
Evaluate Efficient and Effective Use of CWSRF Resources:
EPA and the states use a uniform set of financial and environmental
measures to help determine efficient and effective use of CWSRF
resources. EPA and state-level officials rely on three measures to
assess financial performance, including a set of national financial
indicators, an annual Program Evaluation Report conducted by the
cognizant EPA regional office for each state CWSRF program, and an
annual independent financial audit of the state program. Efforts to
measure the environmental benefits of states' CWSRFs are relatively new
and generally center on EPA's recently developed electronic
Environmental Benefits Reporting System.
EPA Uses Three Measures of States' CWSRF Financial Performance to
Ensure Efficient and Effective Use:
Since the CWSRF program's inception, all states have used similar
measures to evaluate CWSRF financial performance. The first measure,
EPA's National Financial Indicators, consists of five individual
national financial indicators. According to an EPA headquarters
official responsible for these indicators, the agency developed these
indicators in conjunction with the states to provide a balanced
approach to understanding the different objectives of CWSRF financial
performance. According to a senior EPA headquarters official, CWSRF
project-summary information, reported by the states in the National
Information Management System, is used to calculate the indicators on a
state by state and national level. The indicators include the
following:
* Return on Federal Investment estimates how many dollars in
environmental investment have been generated for every federal dollar
spent through the program.
* Ratio of Executed Loans to Funds Available for Loans (often referred
to as the "pace" at which loans are made) measures the cumulative
dollar amount of executed loan agreements relative to the cumulative
dollar amount of funds available for loans. It is one indicator of how
quickly funds are made available to finance CWSRF eligible projects.
* Ratio of CWSRF Loan Disbursement to Executed Loans measures the speed
at which projects are proceeding toward completion by comparing the
cumulative dollar amount of CWSRF loan disbursements with the
cumulative dollar amount of executed loan agreements and expressing
this as a percentage.
* Estimated Additional CWSRF Loans Made Due to Leveraging estimates the
dollar amount of additional projects that have been funded, that
otherwise might not have been, had leveraged bonds not been issued.
This is done by comparing the cumulative amount of CWSRF executed loans
with the cumulative amount of funds available after subtracting the net
funds provided by issuing bonds.
* Sustainability of the Fund gauges how well the CWSRFs are maintaining
their invested or contributed capital, without making adjustments for
loss of purchasing power due to inflation.
EPA's second measure to evaluate effective and efficient use of CWSRF
dollars is its annual review and accompanying written PERs conducted by
EPA's regional offices of each state program. According to the EPA's
annual review guidance, the review is intended to, among other things
(1) evaluate the success of the state's performance in achieving goals
and objectives identified in its Intended Use Plan (which identifies
the intended uses of the amounts available to its CWSRF) and the
state's Annual Report (which describes how the state has met the goals
and objectives of the previous fiscal year as identified by the
Intended Use Plan), (2) determine how the CWSRF is achieving the intent
of the Clean Water Act, (3) assess the financial status and performance
of the fund, and (4) evaluate progress in identifying the environmental
and public health benefits of the program. The review, based on the
information collection and evaluation process, ends with the issuance
of the PER.
EPA's third measure is the annual financial audit. The Clean Water Act
requires the 51 state-level CWSRF programs to undergo these audits to
determine whether the CWSRF financial statements are presented fairly
in all material respects in conformity with Generally Accepted
Accounting Principles (GAAP) and whether the state has complied with
the laws, regulations, and the provisions of CWSRF capitalization
grants.[Footnote 17] The audit, conducted under the Single Audit Act,
focuses on the state's overall CWSRF program, rather than individual
capitalization grants awarded to states by EPA. In addition,
independent audits are conducted in 43 states by auditors contracted by
the state; EPA's Office of Inspector General currently conducts audits
for the remaining eight programs.[Footnote 18]
EPA and the States Have Recently Started Reporting Environmental
Benefits of CWSRF-Funded Projects as a Measure of Efficient and
Effective Use of Program Resources:
Quantifying an environmental program's financial transactions is an
inherently more straightforward exercise than quantifying its
environmental benefits. Nonetheless, the EPA Office of Water's
Environmental Indicator Task Force has been developing environmental
indicators for the CWSRF since at least 1991. This task force,
comprised of federal and state officials, identified obstacles to
measuring benefits and shared ideas for solutions. It attempted to
develop key environmental indicators, such as the number of pounds of
pollutants removed from wastewater treatment plant effluent. However, a
number of obstacles prevented collection of comprehensive environmental
benefits measurements--most notably (1) a lack of baseline
environmental data and (2) technical difficulties in attributing
benefits specifically to the CWSRF. EPA headquarters officials also
explained that environmental monitoring activities are not an allowable
use of CWSRF funds, even as an administrative expense.[Footnote 19]
Despite these complications, the requirements of the Government
Performance and Results Act and EPA's own Strategic Plan have long
recognized the need for outcome-based measures for the agency's
programs. Moreover, according to EPA headquarters officials, recent
reviews by the Office of Management and Budget (OMB) and EPA's Office
of Inspector General provided further impetus to quantify environmental
outcomes of the CWSRF. In particular, a 2004 EPA Office of Inspector
General report criticized the program for not developing a
comprehensive plan for measuring results and recommended that such a
plan be developed. In a similar vein, OMB's Program Assessment Rating
Tool (PART)[Footnote 20] review of the CWSRF cited its inability to
link dollar expenditures with environmental improvements.
In response, representatives of a state-EPA work group and of the
Association of State and Interstate Water Pollution Control
Administrators (assisted by an EPA contractor) developed the
Environmental Benefits Reporting System in July 2005. This system
strives to capture anticipated environmental benefits that are expected
to result from CWSRF-funded projects. The system does not require any
environmental monitoring, focusing instead on anticipated environmental
benefits. According to EPA headquarters officials, all 51 programs have
agreed to use the system to report the environmental benefits of their
CWSRF-funded projects and must report on all loans made from
capitalization grants received after January 1, 2005.
By July 2005, states were able to enter data about anticipated
environmental improvements to bodies of water resulting from CWSRF-
funded projects. Unlike the National Information Management System
data, which is submitted by the states each year in the aggregate, the
environmental benefits data is submitted on a per-project basis, at the
time of loan execution. As of February 2006, 42 states have begun using
it to report CWSRF-supported projects, including nonpoint source
projects.
Some states are attempting to go beyond EPA's requirements by gathering
data on actual environmental benefits from their CWSRF-funded projects,
including nonpoint source projects. Washington State, for example,
recently required applicants to monitor the environmental impact of all
of its CWSRF projects 3 to 5 years after project completion. Between
2001 and 2003, Oklahoma conducted water quality monitoring on 19
receiving streams, both upstream and downstream of CWSRF-funded
improvements to remove pollutants and increase dissolved oxygen in
effluent entering the streams. However, the study could not determine
the extent to which these particular projects improved overall water
quality in the streams, largely because baseline environmental data
were unavailable.
Other states are going beyond the minimal requirements of the EPA
system by estimating the degree to which pollution is prevented by
specific CWSRF-funded projects. Delaware CWSRF officials, for example,
explained that since 2000, they have used estimates of the amount of
pollutants a proposed CWSRF project would remove from the waste stream
to develop the state's Project Priority List. As another example,
according to EPA's Seattle regional officials, Oregon has begun to
award additional points to CWSRF project applicants (thus increasing
the priority of the project) if they agree to conduct their own
environmental monitoring and evaluation.
As EPA and the states have long known, quantifying environmental
programs' benefits with any degree of precision is a challenging
exercise. Nonetheless, their efforts to do so regarding the CWSRF are
particularly important, given the sizable investment of both federal
and state dollars in the program.
Agency Comments and Our Evaluation:
EPA reviewed a draft of this report and provided technical comments,
which have been fully incorporated.
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report are listed in appendix III.
Signed by:
John B. Stephenson:
Director, Natural Resources and Environment:
[End of section]
Appendix I: Scope and Methodology:
GAO's review focused on the following questions:
* To what extent are states currently using their Clean Water State
Revolving Funds (CWSRF) to support conventional wastewater treatment
plant construction versus other qualifying expenses?
* What strategies do states use to allocate their CWSRF dollars among
qualifying expenses?
* What measures do states use to ensure that their allocation
strategies are resulting in the most efficient and effective use of
their CWSRFs?
To determine the extent to which states are currently using their
CWSRFs to support conventional wastewater infrastructure versus other
qualifying expenses, we summarized data from the Environmental
Protection Agency's (EPA) National Information Management System
(NIMS), the database EPA uses to track expenditures for all 51 CWSRF
programs. To assess the reliability of the NIMS data, we interviewed
knowledgeable EPA officials regarding EPA's procedures for collecting
NIMS data from states and monitoring the quality of data submitted by
states. We also reviewed EPA-issued guidance for states inputting data
to the NIMS database. Based on these interviews and guidance we
determined that the data about the usage of CWSRF dollars were
sufficiently reliable for the purposes of this report. Moreover, CWSRF
programs must comply with the Single Audit Act and Generally Accepted
Accounting Principles (GAAP) and undergo independent financial audits.
However, we determined that data about the number of CWSRF loan
agreements were of less certain reliability to identify the exact
percentage of loan agreements between qualifying expenses, given that
states vary in the way that they account for the number of loan
agreements. For example, states do not use common standards to report
the numbers of projects supported by a loan agreement, such as the
number of projects that are point source versus nonpoint source in
nature. Therefore, in figure 2, we reported data about the number of
loan agreements with appropriate caveats.
To examine the strategies states use to allocate their CWSRF dollars
among qualifying expenses, we interviewed EPA and state-level agency
officials and reviewed annual reports and other official EPA and state-
level documents. These interviews included officials at EPA
headquarters, in all 10 EPA regional offices, and select state-level
agency officials. We conducted field visits to Delaware, Minnesota,
Montana, North Carolina, Ohio, Texas, and Washington to obtain detailed
information about CWSRF allocation strategies. We selected the states
using a number of factors, including the following:
* geographic diversity, to accommodate variation in water quality
issues;
* diversity of total amount of CWSRF support;
* diversity in CWSRF-supported projects to include states that do and
do not support nonpoint source projects with CWSRF dollars and states
that support varying or unique types of wastewater or nonpoint source
projects; and:
* a balance of states with and without an Integrated Project Priority
Setting System.
Balancing these criteria, our selected states allowed us to make the
following field visits:
* seven states in 6 of the 10 EPA regions;
* the second largest program (Texas) and the second smallest
(Delaware);
* five states that supported nonpoint source projects, to varying
degrees; and:
* four states with an Integrated Project Priority Setting System and
three states with a traditional project prioritization system.
These field visits and the documents provided by state-level officials
allowed us to include information on a broad range of criteria states
use to prioritize projects and determine funding. During these field
visits, we conducted interviews with state-level CWSRF program
officials and selected recipients of CWSRF loans. To gather information
on additional states, we conducted semistructured phone interviews with
EPA officials from all 10 regional offices, and we followed up with
selected state-level CWSRF officials to discuss allocation strategies
and other aspects of their programs. We used these interviews to
identify the role the EPA regional offices may have in shaping the
state-level CWSRF programs and to gather information on regional trends
and EPA initiatives regarding the CWSRF. We also reviewed each state's
most recent EPA-conducted annual CWSRF Program Evaluation Review.
To examine how states ensure that their allocation strategies result in
the most efficient and effective use of their CWSRFs, we interviewed
EPA and state officials about the financial and environmental measures
they use to assess CWSRF performance. The examination of the most
recent Program Evaluation Review also provided information on the
financial and program performance of each state's CWSRF. In addition,
we reviewed EPA's electronic CWSRF Environmental Benefits Reporting
System by interviewing the contractor that designed it and other
knowledgeable EPA and state-level officials regarding the process and
mechanisms that states use to input data.
We conducted our work between July 2005 and April 2006 in accordance
with generally accepted government auditing standards.
[End of section]
Appendix II: Selected Clean Water State Revolving Fund Financial Data:
The following tables (tables 2-6) and figure (fig. 9) present selected
Clean Water State Revolving Fund (CWSRF) financial data.
Table 2: Clean Water State Revolving Fund for Wastewater Treatment,
Nonpoint Source, and Estuary Projects, by State, Fiscal Years 1987
through 2005:
Dollars in millions.
U.S. total;
Total assistance: $52,703.7;
Wastewater treatment: $4,9951.1;
Nonpoint source: $2,060.8;
Estuaries: $0.
State: Alabama;
Total assistance: $772.8;
Wastewater treatment: $772.8;
Nonpoint source: $0;
Estuaries: $0.
State: Alaska;
Total assistance: 198.3;
Wastewater treatment: 152.2;
Nonpoint source: 46;
Estuaries: 0.
State: Arizona;
Total assistance: 580.4;
Wastewater treatment: 580.4;
Nonpoint source: 0;
Estuaries: 0.
State: Arkansas;
Total assistance: 345.5;
Wastewater treatment: 327.9;
Nonpoint source: 17.5;
Estuaries: 0.
State: California;
Total assistance: 3,044.2;
Wastewater treatment: 2,184.1;
Nonpoint source: 230.2;
Estuaries: 0.
State: Colorado;
Total assistance: 616.7;
Wastewater treatment: 611.4;
Nonpoint source: 5.3;
Estuaries: 0.
State: Connecticut;
Total assistance: 956.6;
Wastewater treatment: 956.6;
Nonpoint source: 0;
Estuaries: 0.
State: Delaware;
Total assistance: 157.5;
Wastewater treatment: 146.3;
Nonpoint source: 11.2;
Estuaries: 0.
State: Florida;
Total assistance: 2,035.3;
Wastewater treatment: 2,018.8;
Nonpoint source: 16.5;
Estuaries: 0.
State: Georgia;
Total assistance: 647.2;
Wastewater treatment: 639.3;
Nonpoint source: 7.9;
Estuaries: 0.
State: Hawaii;
Total assistance: 183;
Wastewater treatment: 179.1;
Nonpoint source: 3.9;
Estuaries: 0.
State: Idaho;
Total assistance: 225.8;
Wastewater treatment: 223.1;
Nonpoint source: 2.7;
Estuaries: 0.
State: Illinois;
Total assistance: 1,732.6;
Wastewater treatment: 1,732.6;
Nonpoint source: 0;
Estuaries: 0.
State: Indiana;
Total assistance: 1,374.6;
Wastewater treatment: 1,373.5;
Nonpoint source: 1.1;
Estuaries: 0.
State: Iowa;
Total assistance: 439.9;
Wastewater treatment: 437.3;
Nonpoint source: 2.6;
Estuaries: 0.
State: Kansas;
Total assistance: 724.7;
Wastewater treatment: 724.7;
Nonpoint source: 0;
Estuaries: 0.
State: Kentucky;
Total assistance: 463.2;
Wastewater treatment: 463.2;
Nonpoint source: 0;
Estuaries: 0.
State: Louisiana;
Total assistance: 407.9;
Wastewater treatment: 407.9;
Nonpoint source: 0;
Estuaries: 0.
State: Maine;
Total assistance: 376.4;
Wastewater treatment: 369.6;
Nonpoint source: 6.8;
Estuaries: 0.
State: Maryland;
Total assistance: 949.3;
Wastewater treatment: 853.2;
Nonpoint source: 96.1;
Estuaries: 0.
State: Massachusetts;
Total assistance: 3,131.8;
Wastewater treatment: 3,079.6;
Nonpoint source: 52.2;
Estuaries: 0.
State: Michigan;
Total assistance: 2,149.9;
Wastewater treatment: 2,149.9;
Nonpoint source: 0;
Estuaries: 0.
State: Minnesota;
Total assistance: 1,586.9;
Wastewater treatment: 1,479.5;
Nonpoint source: 107.4;
Estuaries: 0.
State: Mississippi;
Total assistance: 420;
Wastewater treatment: 420;
Nonpoint source: 0;
Estuaries: 0.
State: Missouri;
Total assistance: 1,429.3;
Wastewater treatment: 1,418.2;
Nonpoint source: 11.1;
Estuaries: 0.
State: Montana;
Total assistance: 189.6;
Wastewater treatment: 159.6;
Nonpoint source: 30;
Estuaries: 0.
State: Nebraska;
Total assistance: 223.3;
Wastewater treatment: 210.4;
Nonpoint source: 12.8;
Estuaries: 0.
State: Nevada;
Total assistance: 251.9;
Wastewater treatment: 239.9;
Nonpoint source: 12;
Estuaries: 0.
State: New Hampshire;
Total assistance: 382.8;
Wastewater treatment: 284;
Nonpoint source: 98.8;
Estuaries: 0.
State: New Jersey;
Total assistance: 1,969.7;
Wastewater treatment: 1,855.7;
Nonpoint source: 113.9;
Estuaries: 0.
State: New Mexico;
Total assistance: 142.2;
Wastewater treatment: 142.1;
Nonpoint source: 0.1;
Estuaries: 0.
State: New York;
Total assistance: 7,942.7;
Wastewater treatment: 6,512.2;
Nonpoint source: 738.7;
Estuaries: 0.
State: North Carolina;
Total assistance: 772.5;
Wastewater treatment: 772.5;
Nonpoint source: 0;
Estuaries: 0.
State: North Dakota;
Total assistance: 150;
Wastewater treatment: 142;
Nonpoint source: 7.9;
Estuaries: 0.
State: Ohio;
Total assistance: 3,233.9;
Wastewater treatment: 3,067.5;
Nonpoint source: 166.4;
Estuaries: 0.
State: Oklahoma;
Total assistance: 449.2;
Wastewater treatment: 449.2;
Nonpoint source: 0;
Estuaries: 0.
State: Oregon;
Total assistance: 528;
Wastewater treatment: 514.4;
Nonpoint source: 13.6;
Estuaries: 0.
State: Pennsylvania;
Total assistance: 1,228.7;
Wastewater treatment: 1,217.9;
Nonpoint source: 10.8;
Estuaries: 0.
State: Puerto Rico;
Total assistance: 298.6;
Wastewater treatment: 298.6;
Nonpoint source: 0;
Estuaries: 0.
State: Rhode Island;
Total assistance: 634.7;
Wastewater treatment: 623.9;
Nonpoint source: 10.8;
Estuaries: 0.
State: South Carolina;
Total assistance: 520.1;
Wastewater treatment: 512;
Nonpoint source: 8.1;
Estuaries: 0.
State: South Dakota;
Total assistance: 203.8;
Wastewater treatment: 192;
Nonpoint source: 11.8;
Estuaries: 0.
State: Tennessee;
Total assistance: 685;
Wastewater treatment: 685;
Nonpoint source: 0;
Estuaries: 0.
State: Texas;
Total assistance: 3,700.1;
Wastewater treatment: 3,698.2;
Nonpoint source: 1.9;
Estuaries: 0.
State: Utah;
Total assistance: 233.6;
Wastewater treatment: 232.2;
Nonpoint source: 1.3;
Estuaries: 0.
State: Vermont;
Total assistance: 122.1;
Wastewater treatment: 122.1;
Nonpoint source: 0;
Estuaries: 0.
State: Virginia;
Total assistance: 1,234.7;
Wastewater treatment: 1,213.1;
Nonpoint source: 21.7;
Estuaries: 0.
State: Washington;
Total assistance: 741.9;
Wastewater treatment: 683.9;
Nonpoint source: 58;
Estuaries: 0.
State: West Virginia;
Total assistance: 478.9;
Wastewater treatment: 473.3;
Nonpoint source: 5.6;
Estuaries: 0.
State: Wisconsin;
Total assistance: 1,196;
Wastewater treatment: 1,184.3;
Nonpoint source: 11.7;
Estuaries: 0.
State: Wyoming;
Total assistance: $240;
Wastewater treatment: $133.8;
Nonpoint source: $106.2;
Estuaries: $0.
Source: EPA's National Information Management System.
Note: Total amounts may not add to the sum of wastewater treatment,
nonpoint source, and estuaries assistance categories due to amounts not
allocated between categories.
[End of Table]
Table 3: Clean Water State Revolving Fund Assistance by Community Size,
Fiscal Years 1987 through 2005:
Dollars in millions.
U.S. total;
Total CWSRF assistance: $52,703.7;
Population less than 3,500: $5,539.5;
Population 3,500 to 9,999: $6,564.2;
Population 10,000 to 99,999: $17,608.8;
Population 100,000 and above: $22,919.2.
State: Alabama;
Total CWSRF assistance: $772.8;
Population less than 3,500: $30.8;
Population 3,500 to 9,999: $81.2;
Population 10,000 to 99,999: $413.7;
Population 100,000 and above: $247.1.
State: Alaska;
Total CWSRF assistance: 198.3;
Population less than 3,500: 14.4;
Population 3,500 to 9,999: 75.1;
Population 10,000 to 99,999: 24;
Population 100,000 and above: 84.8.
State: Arizona;
Total CWSRF assistance: 580.4;
Population less than 3,500: 62.1;
Population 3,500 to 9,999: 135.3;
Population 10,000 to 99,999: 258.4;
Population 100,000 and above: 124.6.
State: Arkansas;
Total CWSRF assistance: 345.5;
Population less than 3,500: 47.3;
Population 3,500 to 9,999: 76.1;
Population 10,000 to 99,999: 153.7;
Population 100,000 and above: 68.4.
State: California;
Total CWSRF assistance: 3,044.2;
Population less than 3,500: 72.2;
Population 3,500 to 9,999: 72.2;
Population 10,000 to 99,999: 952.6;
Population 100,000 and above: 1,947.2.
State: Colorado;
Total CWSRF assistance: 616.7;
Population less than 3,500: 106.4;
Population 3,500 to 9,999: 99.6;
Population 10,000 to 99,999: 291.6;
Population 100,000 and above: 119.
State: Connecticut;
Total CWSRF assistance: 956.6;
Population less than 3,500: 45.7;
Population 3,500 to 9,999: 162.4;
Population 10,000 to 99,999: 542.7;
Population 100,000 and above: 205.9.
State: Delaware;
Total CWSRF assistance: 157.5;
Population less than 3,500: 45.1;
Population 3,500 to 9,999: 50.1;
Population 10,000 to 99,999: 62.4;
Population 100,000 and above: 0.
State: Florida;
Total CWSRF assistance: 2,035.3;
Population less than 3,500: 91.4;
Population 3,500 to 9,999: 252.2;
Population 10,000 to 99,999: 785.5;
Population 100,000 and above: 906.1.
State: Georgia;
Total CWSRF assistance: 647.2;
Population less than 3,500: 62.3;
Population 3,500 to 9,999: 153.5;
Population 10,000 to 99,999: 304.1;
Population 100,000 and above: 127.3.
State: Hawaii;
Total CWSRF assistance: 183;
Population less than 3,500: 67;
Population 3,500 to 9,999: 14.6;
Population 10,000 to 99,999: 97.5;
Population 100,000 and above: 3.9.
State: Idaho;
Total CWSRF assistance: 225.8;
Population less than 3,500: 54.6;
Population 3,500 to 9,999: 48.3;
Population 10,000 to 99,999: 87.9;
Population 100,000 and above: 35.
State: Illinois;
Total CWSRF assistance: 1,732.6;
Population less than 3,500: 120.6;
Population 3,500 to 9,999: 208.8;
Population 10,000 to 99,999: 688.5;
Population 100,000 and above: 714.7.
State: Indiana;
Total CWSRF assistance: 1,374.6;
Population less than 3,500: 238.9;
Population 3,500 to 9,999: 209.9;
Population 10,000 to 99,999: 452.3;
Population 100,000 and above: 473.5.
State: Iowa;
Total CWSRF assistance: 439.9;
Population less than 3,500: 137;
Population 3,500 to 9,999: 153;
Population 10,000 to 99,999: 95.9;
Population 100,000 and above: 54.
State: Kansas;
Total CWSRF assistance: 724.7;
Population less than 3,500: 189.3;
Population 3,500 to 9,999: 124;
Population 10,000 to 99,999: 273.9;
Population 100,000 and above: 137.5.
State: Kentucky;
Total CWSRF assistance: 463.2;
Population less than 3,500: 78.2;
Population 3,500 to 9,999: 128.1;
Population 10,000 to 99,999: 226.3;
Population 100,000 and above: 30.6.
State: Louisiana;
Total CWSRF assistance: 407.9;
Population less than 3,500: 10.2;
Population 3,500 to 9,999: 49.5;
Population 10,000 to 99,999: 217.2;
Population 100,000 and above: 131.
State: Maine;
Total CWSRF assistance: 376.4;
Population less than 3,500: 54.7;
Population 3,500 to 9,999: 156.3;
Population 10,000 to 99,999: 165.3;
Population 100,000 and above: 0.
State: Maryland;
Total CWSRF assistance: 949.3;
Population less than 3,500: 65.5;
Population 3,500 to 9,999: 89.1;
Population 10,000 to 99,999: 208.9;
Population 100,000 and above: 585.8.
State: Massachusetts;
Total CWSRF assistance: 3,131.8;
Population less than 3,500: 71.6;
Population 3,500 to 9,999: 257.6;
Population 10,000 to 99,999: 1,567.8;
Population 100,000 and above: 1,234.9.
State: Michigan;
Total CWSRF assistance: 2,149.9;
Population less than 3,500: 112.4;
Population 3,500 to 9,999: 155.9;
Population 10,000 to 99,999: 786.9;
Population 100,000 and above: 1,094.8.
State: Minnesota;
Total CWSRF assistance: 1,586.9;
Population less than 3,500: 302.7;
Population 3,500 to 9,999: 189.9;
Population 10,000 to 99,999: 220.8;
Population 100,000 and above: 873.6.
State: Mississippi;
Total CWSRF assistance: 420;
Population less than 3,500: 48.5;
Population 3,500 to 9,999: 49.5;
Population 10,000 to 99,999: 292.2;
Population 100,000 and above: 29.7.
State: Missouri;
Total CWSRF assistance: 1,429.3;
Population less than 3,500: 128;
Population 3,500 to 9,999: 215.8;
Population 10,000 to 99,999: 299.5;
Population 100,000 and above: 785.9.
State: Montana;
Total CWSRF assistance: 189.6;
Population less than 3,500: 84.5;
Population 3,500 to 9,999: 23.4;
Population 10,000 to 99,999: 81.7;
Population 100,000 and above: 0.
State: Nebraska;
Total CWSRF assistance: 223.3;
Population less than 3,500: 80.2;
Population 3,500 to 9,999: 51.3;
Population 10,000 to 99,999: 40.7;
Population 100,000 and above: 51.1.
State: Nevada;
Total CWSRF assistance: 251.9;
Population less than 3,500: 13.3;
Population 3,500 to 9,999: 23.8;
Population 10,000 to 99,999: 62.9;
Population 100,000 and above: 151.8.
State: New Hampshire;
Total CWSRF assistance: 382.8;
Population less than 3,500: 21.3;
Population 3,500 to 9,999: 49;
Population 10,000 to 99,999: 213.1;
Population 100,000 and above: 99.4.
State: New Jersey;
Total CWSRF assistance: 1,969.7;
Population less than 3,500: 123;
Population 3,500 to 9,999: 199.7;
Population 10,000 to 99,999: 921.4;
Population 100,000 and above: 725.6.
State: New Mexico;
Total CWSRF assistance: 142.2;
Population less than 3,500: 5;
Population 3,500 to 9,999: 28;
Population 10,000 to 99,999: 65.2;
Population 100,000 and above: 44.1.
State: New York;
Total CWSRF assistance: 7,942.7;
Population less than 3,500: 405.4;
Population 3,500 to 9,999: 255.5;
Population 10,000 to 99,999: 1,092;
Population 100,000 and above: 6,189.7.
State: North Carolina;
Total CWSRF assistance: 772.5;
Population less than 3,500: 91.9;
Population 3,500 to 9,999: 142.7;
Population 10,000 to 99,999: 463.1;
Population 100,000 and above: 74.8.
North Dakota;
Total CWSRF assistance: 150;
Population less than 3,500: 37.9;
Population 3,500 to 9,999: 2.1;
Population 10,000 to 99,999: 109.9;
Population 100,000 and above: 0.1.
Ohio;
Total CWSRF assistance: 3,233.9;
Population less than 3,500: 484.1;
Population 3,500 to 9,999: 358.1;
Population 10,000 to 99,999: 987.1;
Population 100,000 and above: 1,404.7.
Oklahoma;
Total CWSRF assistance: 449.2;
Population less than 3,500: 49.9;
Population 3,500 to 9,999: 52.2;
Population 10,000 to 99,999: 219.3;
Population 100,000 and above: 127.7.
Oregon;
Total CWSRF assistance: 528;
Population less than 3,500: 71.3;
Population 3,500 to 9,999: 190;
Population 10,000 to 99,999: 203;
Population 100,000 and above: 63.7.
Pennsylvania;
Total CWSRF assistance: 1,228.7;
Population less than 3,500: 566.7;
Population 3,500 to 9,999: 346.8;
Population 10,000 to 99,999: 304;
Population 100,000 and above: 10.5.
Puerto Rico;
Total CWSRF assistance: 298.6;
Population less than 3,500: 96.3;
Population 3,500 to 9,999: 41;
Population 10,000 to 99,999: 81.4;
Population 100,000 and above: 79.9.
Rhode Island;
Total CWSRF assistance: 634.7;
Population less than 3,500: 51;
Population 3,500 to 9,999: 52.8;
Population 10,000 to 99,999: 161.4;
Population 100,000 and above: 369.5.
State: South Carolina;
Total CWSRF assistance: 520.1;
Population less than 3,500: 21;
Population 3,500 to 9,999: 93.6;
Population 10,000 to 99,999: 351.8;
Population 100,000 and above: 53.7.
State: South Dakota;
Total CWSRF assistance: 203.8;
Population less than 3,500: 40;
Population 3,500 to 9,999: 14.1;
Population 10,000 to 99,999: 82.1;
Population 100,000 and above: 67.6.
State: Tennessee;
Total CWSRF assistance: 685;
Population less than 3,500: 40.3;
Population 3,500 to 9,999: 118.3;
Population 10,000 to 99,999: 276.8;
Population 100,000 and above: 249.6.
State: Texas;
Total CWSRF assistance: 3,700.1;
Population less than 3,500: 234.1;
Population 3,500 to 9,999: 539.1;
Population 10,000 to 99,999: 975;
Population 100,000 and above: 1,951.8.
State: Utah;
Total CWSRF assistance: 233.6;
Population less than 3,500: 42.1;
Population 3,500 to 9,999: 47.4;
Population 10,000 to 99,999: 81.1;
Population 100,000 and above: 63.
State: Vermont;
Total CWSRF assistance: 122.1;
Population less than 3,500: 30.5;
Population 3,500 to 9,999: 51.6;
Population 10,000 to 99,999: 40;
Population 100,000 and above: 0.
State: Virginia;
Total CWSRF assistance: 1,234.7;
Population less than 3,500: 180.4;
Population 3,500 to 9,999: 187.6;
Population 10,000 to 99,999: 464.6;
Population 100,000 and above: 402.1.
State: Washington;
Total CWSRF assistance: 741.9;
Population less than 3,500: 149.7;
Population 3,500 to 9,999: 132.6;
Population 10,000 to 99,999: 272.9;
Population 100,000 and above: 186.8.
State: West Virginia;
Total CWSRF assistance: 478.9;
Population less than 3,500: 158.6;
Population 3,500 to 9,999: 173.7;
Population 10,000 to 99,999: 146.6;
Population 100,000 and above: 0.
State: Wisconsin;
Total CWSRF assistance: 1,196;
Population less than 3,500: 166.2;
Population 3,500 to 9,999: 126.9;
Population 10,000 to 99,999: 381.3;
Population 100,000 and above: 521.7.
State: Wyoming;
Total CWSRF assistance: $240;
Population less than 3,500: $37.8;
Population 3,500 to 9,999: $54.9;
Population 10,000 to 99,999: $132.3;
Population 100,000 and above: $15.1.
Source: EPA's National Information Management System.
Note: Numbers may not add to total due to rounding.
[End of Table]
Table 4: Clean Water State Revolving Fund National Financial
Indicators, Fiscal Years 1987 through 2005:
Dollars in millions.
U.S. total;
Project disbursements as a percentage of cash draws: 212%;
Assistance provided as a percentage of funds available: 95%;
Project disbursements as a percentage of assistance provided: 85%;
Sustainability/ retained earnings: $4,314.0.
States that have leveraged:
Alabama;
Project disbursements as a percentage of cash draws: 305%;
Assistance provided as a percentage of funds available: 95%;
Project disbursements as a percentage of assistance provided: 88%;
Sustainability/ retained earnings: $35.3.
Arizona;
Project disbursements as a percentage of cash draws: 277;
Assistance provided as a percentage of funds available: 112;
Project disbursements as a percentage of assistance provided: 72;
Sustainability/ retained earnings: 4.6.
Arkansas;
Project disbursements as a percentage of cash draws: 187;
Assistance provided as a percentage of funds available: 91;
Project disbursements as a percentage of assistance provided: 81;
Sustainability/ retained earnings: 27.4.
California;
Project disbursements as a percentage of cash draws: 178;
Assistance provided as a percentage of funds available: 94;
Project disbursements as a percentage of assistance provided: 91;
Sustainability/ retained earnings: 396.0.
Colorado;
Project disbursements as a percentage of cash draws: 313;
Assistance provided as a percentage of funds available: 93;
Project disbursements as a percentage of assistance provided: 85;
Sustainability/ retained earnings: 14.0.
Connecticut;
Project disbursements as a percentage of cash draws: 276;
Assistance provided as a percentage of funds available: 98;
Project disbursements as a percentage of assistance provided: 89;
Sustainability/ retained earnings: 28.9.
Florida;
Project disbursements as a percentage of cash draws: 195;
Assistance provided as a percentage of funds available: 107;
Project disbursements as a percentage of assistance provided: 72;
Sustainability/ retained earnings: 276.5.
Illinois;
Project disbursements as a percentage of cash draws: 156;
Assistance provided as a percentage of funds available: 92;
Project disbursements as a percentage of assistance provided: 93;
Sustainability/ retained earnings: 196.0.
Indiana;
Project disbursements as a percentage of cash draws: 187;
Assistance provided as a percentage of funds available: 81;
Project disbursements as a percentage of assistance provided: 77;
Sustainability/ retained earnings: 41.2.
Iowa;
Project disbursements as a percentage of cash draws: 151;
Assistance provided as a percentage of funds available: 80;
Project disbursements as a percentage of assistance provided: 91;
Sustainability/ retained earnings: 41.4.
Kansas;
Project disbursements as a percentage of cash draws: 315;
Assistance provided as a percentage of funds available: 104;
Project disbursements as a percentage of assistance provided: 85;
Sustainability/ retained earnings: -11.3.
Maine;
Project disbursements as a percentage of cash draws: 210;
Assistance provided as a percentage of funds available: 93;
Project disbursements as a percentage of assistance provided: 92;
Sustainability/ retained earnings: 32.1.
Maryland;
Project disbursements as a percentage of cash draws: 163;
Assistance provided as a percentage of funds available: 92;
Project disbursements as a percentage of assistance provided: 83;
Sustainability/ retained earnings: 136.0.
Massachusetts;
Project disbursements as a percentage of cash draws: 309;
Assistance provided as a percentage of funds available: 116;
Project disbursements as a percentage of assistance provided: 83;
Sustainability/ retained earnings: 292.0.
Michigan;
Project disbursements as a percentage of cash draws: 195;
Assistance provided as a percentage of funds available: 103;
Project disbursements as a percentage of assistance provided: 86;
Sustainability/ retained earnings: -140.6.
Minnesota;
Project disbursements as a percentage of cash draws: 373;
Assistance provided as a percentage of funds available: 98;
Project disbursements as a percentage of assistance provided: 97;
Sustainability/ retained earnings: 100.6.
Missouri;
Project disbursements as a percentage of cash draws: 233;
Assistance provided as a percentage of funds available: 83;
Project disbursements as a percentage of assistance provided: 94;
Sustainability/ retained earnings: 75.2.
Nevada;
Project disbursements as a percentage of cash draws: 221;
Assistance provided as a percentage of funds available: 91;
Project disbursements as a percentage of assistance provided: 73;
Sustainability/ retained earnings: 13.7.
New Jersey;
Project disbursements as a percentage of cash draws: 206;
Assistance provided as a percentage of funds available: 71;
Project disbursements as a percentage of assistance provided: 79;
Sustainability/ retained earnings: 418.7.
New York;
Project disbursements as a percentage of cash draws: 323;
Assistance provided as a percentage of funds available: 103;
Project disbursements as a percentage of assistance provided: 100;
Sustainability/ retained earnings: 219.6.
North Dakota;
Project disbursements as a percentage of cash draws: 139;
Assistance provided as a percentage of funds available: 64;
Project disbursements as a percentage of assistance provided: 98;
Sustainability/ retained earnings: 19.5.
Ohio;
Project disbursements as a percentage of cash draws: 193;
Assistance provided as a percentage of funds available: 102;
Project disbursements as a percentage of assistance provided: 67;
Sustainability/ retained earnings: 91.8.
Oklahoma;
Project disbursements as a percentage of cash draws: 229;
Assistance provided as a percentage of funds available: 84;
Project disbursements as a percentage of assistance provided: 86;
Sustainability/ retained earnings: 30.7.
Rhode Island;
Project disbursements as a percentage of cash draws: 299;
Assistance provided as a percentage of funds available: 129;
Project disbursements as a percentage of assistance provided: 69;
Sustainability/ retained earnings: 7.9.
South Dakota;
Project disbursements as a percentage of cash draws: 159;
Assistance provided as a percentage of funds available: 98;
Project disbursements as a percentage of assistance provided: 71;
Sustainability/ retained earnings: 23.4.
Texas;
Project disbursements as a percentage of cash draws: 294;
Assistance provided as a percentage of funds available: 94;
Project disbursements as a percentage of assistance provided: 86;
Sustainability/ retained earnings: 237.2.
Virginia;
Project disbursements as a percentage of cash draws: 209;
Assistance provided as a percentage of funds available: 85;
Project disbursements as a percentage of assistance provided: 86;
Sustainability/ retained earnings: 208.6.
States that have not leveraged:
Alaska;
Project disbursements as a percentage of cash draws: 116;
Assistance provided as a percentage of funds available: 81;
Project disbursements as a percentage of assistance provided: 80;
Sustainability/ retained earnings: 31.2.
Delaware;
Project disbursements as a percentage of cash draws: 118;
Assistance provided as a percentage of funds available: 98;
Project disbursements as a percentage of assistance provided: 68;
Sustainability/ retained earnings: 9.7.
Georgia;
Project disbursements as a percentage of cash draws: 115;
Assistance provided as a percentage of funds available: 79;
Project disbursements as a percentage of assistance provided: 78;
Sustainability/ retained earnings: 147.8.
Hawaii;
Project disbursements as a percentage of cash draws: 142;
Assistance provided as a percentage of funds available: 54;
Project disbursements as a percentage of assistance provided: 99;
Sustainability/ retained earnings: 52.3.
Idaho;
Project disbursements as a percentage of cash draws: 143;
Assistance provided as a percentage of funds available: 90;
Project disbursements as a percentage of assistance provided: 69;
Sustainability/ retained earnings: 45.2.
Kentucky;
Project disbursements as a percentage of cash draws: 130;
Assistance provided as a percentage of funds available: 86;
Project disbursements as a percentage of assistance provided: 74;
Sustainability/ retained earnings: 79.5.
Louisiana;
Project disbursements as a percentage of cash draws: 142;
Assistance provided as a percentage of funds available: 89;
Project disbursements as a percentage of assistance provided: 83;
Sustainability/ retained earnings: 42.9.
Mississippi;
Project disbursements as a percentage of cash draws: 149;
Assistance provided as a percentage of funds available: 100;
Project disbursements as a percentage of assistance provided: 76;
Sustainability/ retained earnings: 75.9.
Montana;
Project disbursements as a percentage of cash draws: 167;
Assistance provided as a percentage of funds available: 98;
Project disbursements as a percentage of assistance provided: 97;
Sustainability/ retained earnings: 6.9.
Nebraska;
Project disbursements as a percentage of cash draws: 161;
Assistance provided as a percentage of funds available: 91;
Project disbursements as a percentage of assistance provided: 82;
Sustainability/ retained earnings: 18.8.
New Hampshire;
Project disbursements as a percentage of cash draws: 166;
Assistance provided as a percentage of funds available: 100;
Project disbursements as a percentage of assistance provided: 72;
Sustainability/ retained earnings: 33.0.
New Mexico;
Project disbursements as a percentage of cash draws: 123;
Assistance provided as a percentage of funds available: 70;
Project disbursements as a percentage of assistance provided: 89;
Sustainability/ retained earnings: 33.7.
North Carolina;
Project disbursements as a percentage of cash draws: 148;
Assistance provided as a percentage of funds available: 97;
Project disbursements as a percentage of assistance provided: 76;
Sustainability/ retained earnings: 122.5.
Oregon;
Project disbursements as a percentage of cash draws: 159;
Assistance provided as a percentage of funds available: 108;
Project disbursements as a percentage of assistance provided: 75;
Sustainability/ retained earnings: 61.1.
Pennsylvania;
Project disbursements as a percentage of cash draws: 140;
Assistance provided as a percentage of funds available: 88;
Project disbursements as a percentage of assistance provided: 89;
Sustainability/ retained earnings: 129.6.
Puerto Rico;
Project disbursements as a percentage of cash draws: 126;
Assistance provided as a percentage of funds available: 78;
Project disbursements as a percentage of assistance provided: 56;
Sustainability/ retained earnings: 21.4.
South Carolina;
Project disbursements as a percentage of cash draws: 166;
Assistance provided as a percentage of funds available: 93;
Project disbursements as a percentage of assistance provided: 84;
Sustainability/ retained earnings: 123.4.
Tennessee;
Project disbursements as a percentage of cash draws: 152;
Assistance provided as a percentage of funds available: 90;
Project disbursements as a percentage of assistance provided: 74;
Sustainability/ retained earnings: 150.7.
Utah;
Project disbursements as a percentage of cash draws: 185;
Assistance provided as a percentage of funds available: 100;
Project disbursements as a percentage of assistance provided: 96;
Sustainability/ retained earnings: 20.1.
Vermont;
Project disbursements as a percentage of cash draws: 123;
Assistance provided as a percentage of funds available: 88;
Project disbursements as a percentage of assistance provided: 94;
Sustainability/ retained earnings: 2.1.
Washington;
Project disbursements as a percentage of cash draws: 171;
Assistance provided as a percentage of funds available: 100;
Project disbursements as a percentage of assistance provided: 77;
Sustainability/ retained earnings: 102.4.
West Virginia;
Project disbursements as a percentage of cash draws: 129;
Assistance provided as a percentage of funds available: 93;
Project disbursements as a percentage of assistance provided: 91;
Sustainability/ retained earnings: 29.9.
Wisconsin;
Project disbursements as a percentage of cash draws: 171;
Assistance provided as a percentage of funds available: 109;
Project disbursements as a percentage of assistance provided: 85;
Sustainability/ retained earnings: 147.8.
Wyoming;
Project disbursements as a percentage of cash draws: 170%;
Assistance provided as a percentage of funds available: 91%;
Project disbursements as a percentage of assistance provided: 68%;
Sustainability/ retained earnings: $36.7.
Source: EPA's National Information Management System.
Note: Numbers may not add to totals due to rounding.
[End of Table]
Table 5: Clean Water State Revolving Funds Available for Projects,
Fiscal Years 1987 through 2005:
Dollars in millions.
U.S. total;
Federal capitalization: $23,251.5;
State contributions: $4,806;
Leveraged bonds: $23,424.4;
Gross loan principal repayments: $13,187.9;
Gross loan interest payments: $7,459.6;
Gross investment earnings: $4,955.7;
SRF funds available for projects: $55,266.2.
Alabama;
Federal capitalization: $249;
State contributions: $107.3;
Leveraged bonds: $587.1;
Gross loan principal repayments: $224.2;
Gross loan interest payments: $176.4;
Gross investment earnings: $165.5;
SRF funds available for projects: $812.3.
Alaska;
Federal capitalization: 137.7;
State contributions: 27.8;
Leveraged bonds: 0;
Gross loan principal repayments: 54;
Gross loan interest payments: 17.5;
Gross investment earnings: 21.7;
SRF funds available for projects: 245.2.
Arizona;
Federal capitalization: 158.6;
State contributions: 40.5;
Leveraged bonds: 276;
Gross loan principal repayments: 115.8;
Gross loan interest payments: 49.1;
Gross investment earnings: 50.4;
SRF funds available for projects: 518.6.
Arkansas;
Federal capitalization: 162.8;
State contributions: 31;
Leveraged bonds: 116.9;
Gross loan principal repayments: 97.6;
Gross loan interest payments: 59.6;
Gross investment earnings: 36.5;
SRF funds available for projects: 378.7.
California;
Federal capitalization: 1,709.8;
State contributions: 309.4;
Leveraged bonds: 298.9;
Gross loan principal repayments: 649.3;
Gross loan interest payments: 306.1;
Gross investment earnings: 95.6;
SRF funds available for projects: 3,229.5.
Colorado;
Federal capitalization: 169.3;
State contributions: 39.3;
Leveraged bonds: 557;
Gross loan principal repayments: 145.7;
Gross loan interest payments: 76.7;
Gross investment earnings: 111.1;
SRF funds available for projects: 660.6.
Connecticut;
Federal capitalization: 327.2;
State contributions: 103.9;
Leveraged bonds: 800.4;
Gross loan principal repayments: 291.2;
Gross loan interest payments: 110.8;
Gross investment earnings: 263.8;
SRF funds available for projects: 980.5.
Delaware;
Federal capitalization: 107.2;
State contributions: 21.4;
Leveraged bonds: 0;
Gross loan principal repayments: 26.3;
Gross loan interest payments: 5.6;
Gross investment earnings: 4.1;
SRF funds available for projects: 160.3.
Florida;
Federal capitalization: 844.1;
State contributions: 174.3;
Leveraged bonds: 150.7;
Gross loan principal repayments: 528.6;
Gross loan interest payments: 209.4;
Gross investment earnings: 81.6;
SRF funds available for projects: 1911.
Georgia;
Federal capitalization: 450.1;
State contributions: 88.8;
Leveraged bonds: 0;
Gross loan principal repayments: 161.1;
Gross loan interest payments: 93.1;
Gross investment earnings: 54.6;
SRF funds available for projects: 821.3.
Hawaii;
Federal capitalization: 169.8;
State contributions: 662.9;
Leveraged bonds: 0;
Gross loan principal repayments: 61.6;
Gross loan interest payments: 28.6;
Gross investment earnings: 23.7;
SRF funds available for projects: 339.8.
Idaho;
Federal capitalization: 109;
State contributions: 21.8;
Leveraged bonds: 0;
Gross loan principal repayments: 79.2;
Gross loan interest payments: 30.9;
Gross investment earnings: 14.3;
SRF funds available for projects: 250.8.
Illinois;
Federal capitalization: 1,028.4;
State contributions: 188.8;
Leveraged bonds: 189.5;
Gross loan principal repayments: 418.6;
Gross loan interest payments: 142.5;
Gross investment earnings: 69.7;
SRF funds available for projects: 1,881.9.
Indiana;
Federal capitalization: 557.6;
State contributions: 115.5;
Leveraged bonds: 1,301.2;
Gross loan principal repayments: 168.2;
Gross loan interest payments: 108.4;
Gross investment earnings: 263.1;
SRF funds available for projects: 1,688.
Iowa;
Federal capitalization: 283.3;
State contributions: 53.1;
Leveraged bonds: 186.5;
Gross loan principal repayments: 139.3;
Gross loan interest payments: 82.9;
Gross investment earnings: 115.1;
SRF funds available for projects: 547.4.
Kansas;
Federal capitalization: 211.4;
State contributions: 43.1;
Leveraged bonds: 403.5;
Gross loan principal repayments: 137.3;
Gross loan interest payments: 78.8;
Gross investment earnings: 54.4;
SRF funds available for projects: 695.4.
Kentucky;
Federal capitalization: 304.8;
State contributions: 63;
Leveraged bonds: 0;
Gross loan principal repayments: 103.4;
Gross loan interest payments: 51.6;
Gross investment earnings: 27.9;
SRF funds available for projects: 538.5.
Louisiana;
Federal capitalization: 249.5;
State contributions: 50.3;
Leveraged bonds: 0;
Gross loan principal repayments: 127.8;
Gross loan interest payments: 50.3;
Gross investment earnings: 16.6;
SRF funds available for projects: 460.4.
Maine;
Federal capitalization: 177.3;
State contributions: 37.8;
Leveraged bonds: 97.3;
Gross loan principal repayments: 117.6;
Gross loan interest payments: 58.5;
Gross investment earnings: 23;
SRF funds available for projects: 404.7.
Maryland;
Federal capitalization: 544.2;
State contributions: 102.4;
Leveraged bonds: 160.9;
Gross loan principal repayments: 234.1;
Gross loan interest payments: 134.8;
Gross investment earnings: 104.8;
SRF funds available for projects: 1,027.7.
Massachusetts;
Federal capitalization: 831.1;
State contributions: 171;
Leveraged bonds: 2,747.9;
Gross loan principal repayments: 490.9;
Gross loan interest payments: 616.7;
Gross investment earnings: 421;
SRF funds available for projects: 2,705.
Michigan;
Federal capitalization: 1,023.1;
State contributions: 205;
Leveraged bonds: 1967;
Gross loan principal repayments: 387.5;
Gross loan interest payments: 187.5;
Gross investment earnings: 314.9;
SRF funds available for projects: 2,079.7.
Minnesota;
Federal capitalization: 434.1;
State contributions: 93.5;
Leveraged bonds: 999;
Gross loan principal repayments: 479.5;
Gross loan interest payments: 255.2;
Gross investment earnings: 189.3;
SRF funds available for projects: 1,625.6.
Mississippi;
Federal capitalization: 225.1;
State contributions: 45.7;
Leveraged bonds: 0;
Gross loan principal repayments: 84;
Gross loan interest payments: 56.9;
Gross investment earnings: 19;
SRF funds available for projects: 421.7.
Missouri;
Federal capitalization: 625.7;
State contributions: 121.9;
Leveraged bonds: 1,400.5;
Gross loan principal repayments: 489.2;
Gross loan interest payments: 338;
Gross investment earnings: 65.3;
SRF funds available for projects: 1,713.8.
Montana;
Federal capitalization: 114;
State contributions: 33.7;
Leveraged bonds: 0;
Gross loan principal repayments: 46.9;
Gross loan interest payments: 14.1;
Gross investment earnings: 6.9;
SRF funds available for projects: 194.2.
Nebraska;
Federal capitalization: 119.7;
State contributions: 24.5;
Leveraged bonds: 0;
Gross loan principal repayments: 87.6;
Gross loan interest payments: 27.6;
Gross investment earnings: 15.7;
SRF funds available for projects: 245.8.
Nevada;
Federal capitalization: 108.7;
State contributions: 20.8;
Leveraged bonds: 104.7;
Gross loan principal repayments: 42.5;
Gross loan interest payments: 34.2;
Gross investment earnings: 11.3;
SRF funds available for projects: 278.3.
New Hampshire;
Federal capitalization: 226.3;
State contributions: 47.4;
Leveraged bonds: 0;
Gross loan principal repayments: 83.6;
Gross loan interest payments: 25.4;
Gross investment earnings: 7.5;
SRF funds available for projects: 381.2.
New Jersey;
Federal capitalization: 1,048.8;
State contributions: 220.6;
Leveraged bonds: 950.1;
Gross loan principal repayments: 605.1;
Gross loan interest payments: 358.7;
Gross investment earnings: 282.6;
SRF funds available for projects: 2,762.2.
New Mexico;
Federal capitalization: 113;
State contributions: 27;
Leveraged bonds: 0;
Gross loan principal repayments: 34;
Gross loan interest payments: 20.3;
Gross investment earnings: 13.3;
SRF funds available for projects: 203.1.
New York;
Federal capitalization: 2,574.7;
State contributions: 515;
Leveraged bonds: 6,318.1;
Gross loan principal repayments: 2,374.1;
Gross loan interest payments: 1,355.5;
Gross investment earnings: 1,106.8;
SRF funds available for projects: 7,694.8.
North Carolina;
Federal capitalization: 424.6;
State contributions: 88.8;
Leveraged bonds: 0;
Gross loan principal repayments: 177.1;
Gross loan interest payments: 81.9;
Gross investment earnings: 40.5;
SRF funds available for projects: 796.
North Dakota;
Federal capitalization: 102.4;
State contributions: 24.8;
Leveraged bonds: 75.3;
Gross loan principal repayments: 41.2;
Gross loan interest payments: 19.9;
Gross investment earnings: 45.2;
SRF funds available for projects: 233.2.
Ohio;
Federal capitalization: 1,300.2;
State contributions: 270.4;
Leveraged bonds: 1,173.3;
Gross loan principal repayments: 524.8;
Gross loan interest payments: 391.9;
Gross investment earnings: 181.7;
SRF funds available for projects: 3,164.3.
Oklahoma;
Federal capitalization: 178.4;
State contributions: 41.3;
Leveraged bonds: 146;
Gross loan principal repayments: 219.9;
Gross loan interest payments: 22.6;
Gross investment earnings: 31.7;
SRF funds available for projects: 536.1.
Oregon;
Federal capitalization: 263.5;
State contributions: 54.6;
Leveraged bonds: 0;
Gross loan principal repayments: 121.1;
Gross loan interest payments: 57.8;
Gross investment earnings: 21.4;
SRF funds available for projects: 489.8.
Pennsylvania;
Federal capitalization: 894;
State contributions: 181;
Leveraged bonds: 0;
Gross loan principal repayments: 292.2;
Gross loan interest payments: 76.8;
Gross investment earnings: 52.8;
SRF funds available for projects: 1,403.6.
Puerto Rico;
Federal capitalization: 287.9;
State contributions: 57.6;
Leveraged bonds: 0;
Gross loan principal repayments: 37.1;
Gross loan interest payments: 16.4;
Gross investment earnings: 5;
SRF funds available for projects: 381.5.
Rhode Island;
Federal capitalization: 149.7;
State contributions: 29.9;
Leveraged bonds: 416.3;
Gross loan principal repayments: 67;
Gross loan interest payments: 41;
Gross investment earnings: 52.8;
SRF funds available for projects: 493.1.
South Carolina;
Federal capitalization: 265.9;
State contributions: 53.2;
Leveraged bonds: 0;
Gross loan principal repayments: 123.8;
Gross loan interest payments: 81.9;
Gross investment earnings: 41.5;
SRF funds available for projects: 562.3.
South Dakota;
Federal capitalization: 114;
State contributions: 22.7;
Leveraged bonds: 4.5;
Gross loan principal repayments: 64.4;
Gross loan interest payments: 21.6;
Gross investment earnings: 24.4;
SRF funds available for projects: 207.3.
Tennessee;
Federal capitalization: 375.3;
State contributions: 78.7;
Leveraged bonds: 0;
Gross loan principal repayments: 174.7;
Gross loan interest payments: 110;
Gross investment earnings: 40.7;
SRF funds available for projects: 764.4.
Texas;
Federal capitalization: 1,220.9;
State contributions: 248.3;
Leveraged bonds: 1,615.1;
Gross loan principal repayments: 1,236;
Gross loan interest payments: 942.7;
Gross investment earnings: 137.6;
SRF funds available for projects: 3,936.1.
Utah;
Federal capitalization: 135.4;
State contributions: 24.5;
Leveraged bonds: 0;
Gross loan principal repayments: 58.8;
Gross loan interest payments: 10.1;
Gross investment earnings: 10;
SRF funds available for projects: 233.4.
Vermont;
Federal capitalization: 103.6;
State contributions: 20.7;
Leveraged bonds: 0;
Gross loan principal repayments: 15.9;
Gross loan interest payments: 0;
Gross investment earnings: 2.1;
SRF funds available for projects: 138.1.
Virginia;
Federal capitalization: 552.9;
State contributions: 110.8;
Leveraged bonds: 380.7;
Gross loan principal repayments: 315.6;
Gross loan interest payments: 169.7;
Gross investment earnings: 102.7;
SRF funds available for projects: 1,451.1.
Washington;
Federal capitalization: 388.1;
State contributions: 77.6;
Leveraged bonds: 0;
Gross loan principal repayments: 189;
Gross loan interest payments: 77.7;
Gross investment earnings: 24.7;
SRF funds available for projects: 741.7.
West Virginia;
Federal capitalization: 347.1;
State contributions: 69.4;
Leveraged bonds: 0;
Gross loan principal repayments: 81.5;
Gross loan interest payments: 13.4;
Gross investment earnings: 16.5;
SRF funds available for projects: 514.1.
Wisconsin;
Federal capitalization: 605.5;
State contributions: 119.3;
Leveraged bonds: 0;
Gross loan principal repayments: 275.2;
Gross loan interest payments: 154.2;
Gross investment earnings: 44.9;
SRF funds available for projects: 1,100.
Wyoming;
Federal capitalization: $119.8;
State contributions: $24;
Leveraged bonds: $0;
Gross loan principal repayments: $86.7;
Gross loan interest payments: $8.1;
Gross investment earnings: $28.6;
SRF funds available for projects: $262.4.
Source: EPA's National Information Management System.
Note: Numbers may not add to totals due to rounding.
[End of Table]
Figure 9: Annual Average Interest Rates for the Clean Water State
Revolving Fund Compared with Annual Average Market Interest Rates:
[See PDF for image]
Note: The market rate based on the Bond Buyer index for 20-year general
obligation (GO) bonds with a rating equivalent to Moody's Aa and
Standard and Poor's AA-minus. Data is the average of the reported
weekly Bond Buyer 20-bond GO index for each fiscal year ending June 30.
[End of figure]
Table 6: Assistance Provided Through the Clean Water State Revolving
Fund Program and Other State Funded Clean Water and Loan Grant
Programs, Fiscal Years 1987 through 2005:
Dollars in millions.
U.S. total;
CWSRF program: $52,703.7;
State-funded loans: [Empty];
State- funded grants: [Empty].
Reported total;
CWSRF program: [Empty];
State-funded loans: $3,865.3;
State- funded grants: $4,041.5.
Alabama;
CWSRF program: $772.8;
State-funded loans: $0;
State-funded grants: $0.
Alaska;
CWSRF program: 198.3;
State-funded loans: 0;
State-funded grants: 129.9.
Arizona;
CWSRF program: 580.4;
State-funded loans: NA;
State-funded grants: 1.2.
Arkansas;
CWSRF program: 345.5;
State-funded loans: 51.4;
State-funded grants: 3.
California;
CWSRF program: 3,044.2;
State-funded loans: 67.6;
State-funded grants: 116.8.
Colorado;
CWSRF program: 616.7;
State-funded loans: 48.7;
State-funded grants: 30.4.
Connecticut;
CWSRF program: 956.6;
State-funded loans: 88.7;
State-funded grants: 350.9.
Delaware;
CWSRF program: 157.5;
State-funded loans: 4.5;
State-funded grants: 35.4.
Florida;
CWSRF program: 2,035.3;
State-funded loans: 0;
State-funded grants: 148.3.
Georgia;
CWSRF program: 647.2;
State-funded loans: 68.2;
State-funded grants: 0.
Hawaii;
CWSRF program: 183;
State-funded loans: 44.8;
State-funded grants: 18.5.
Idaho;
CWSRF program: 225.8;
State-funded loans: 3.5;
State-funded grants: 26.3.
Illinois;
CWSRF program: 1,732.6;
State-funded loans: 0;
State-funded grants: 489.5.
Indiana;
CWSRF program: 1,374.6;
State-funded loans: 23.8;
State-funded grants: 54.7.
Iowa;
CWSRF program: 439.9;
State-funded loans: 0;
State-funded grants: 0.
Kansas;
CWSRF program: 724.7;
State-funded loans: 0;
State-funded grants: 0.
Kentucky;
CWSRF program: 463.2;
State-funded loans: 94;
State-funded grants: 36.9.
Louisiana;
CWSRF program: 407.9;
State-funded loans: 0;
State-funded grants: 0.
Maine;
CWSRF program: 376.4;
State-funded loans: 196.5;
State-funded grants: 89.7.
Maryland;
CWSRF program: 949.3;
State-funded loans: 0;
State-funded grants: 303.6.
Massachusetts;
CWSRF program: 3,131.8;
State-funded loans: 42.1;
State-funded grants: 0.
Michigan;
CWSRF program: 2,149.9;
State-funded loans: 2;
State-funded grants: 0.
Minnesota;
CWSRF program: 1,586.9;
State-funded loans: 0;
State-funded grants: 194.
Mississippi;
CWSRF program: 420;
State-funded loans: 1.5;
State-funded grants: 0.
Missouri;
CWSRF program: 1,429.3;
State-funded loans: 2.3;
State-funded grants: 97.1.
Montana;
CWSRF program: 189.6;
State-funded loans: 0;
State-funded grants: 0.
Nebraska;
CWSRF program: 223.3;
State-funded loans: 0;
State-funded grants: 0.
Nevada;
CWSRF program: 251.9;
State-funded loans: 0;
State-funded grants: 0.
New Hampshire;
CWSRF program: 382.8;
State-funded loans: 0;
State-funded grants: 173.5.
New Jersey;
CWSRF program: 1,969.7;
State-funded loans: 369.3;
State-funded grants: 0.
New Mexico;
CWSRF program: 142.2;
State-funded loans: 27.6;
State-funded grants: 63.4.
New York;
CWSRF program: 7,942.7;
State-funded loans: NA;
State-funded grants: NA.
North Carolina;
CWSRF program: 772.5;
State-funded loans: 62.9;
State-funded grants: 228.9.
North Dakota;
CWSRF program: 150;
State-funded loans: 0;
State-funded grants: 0.
Ohio;
CWSRF program: 3,233.9;
State-funded loans: 625.8;
State-funded grants: 319.
Oklahoma;
CWSRF program: 449.2;
State-funded loans: 112;
State-funded grants: 19.2.
Oregon;
CWSRF program: 528;
State-funded loans: NA;
State-funded grants: NA.
Pennsylvania;
CWSRF program: 1,228.7;
State-funded loans: 426.9;
State-funded grants: 48.6.
Puerto Rico;
CWSRF program: 298.6;
State-funded loans: 0;
State-funded grants: 0.
Rhode Island;
CWSRF program: 634.7;
State-funded loans: 58.1;
State-funded grants: 37.4.
South Carolina;
CWSRF program: 520.1;
State-funded loans: NA;
State-funded grants: NA.
South Dakota;
CWSRF program: 203.8;
State-funded loans: 0;
State-funded grants: NA.
Tennessee;
CWSRF program: 685;
State-funded loans: 0;
State-funded grants: 0.
Texas;
CWSRF program: 3,700.1;
State-funded loans: 225;
State-funded grants: 0.
Utah;
CWSRF program: 233.6;
State-funded loans: 54.2;
State-funded grants: 22.2.
Vermont;
CWSRF program: 122.1;
State-funded loans: 0.7;
State-funded grants: NA.
Virginia;
CWSRF program: 1,234.7;
State-funded loans: 0;
State-funded grants: 112.
Washington;
CWSRF program: 741.9;
State-funded loans: 3.1;
State-funded grants: 591.2.
West Virginia;
CWSRF program: 478.9;
State-funded loans: 248.1;
State-funded grants: 52.2.
Wisconsin;
CWSRF program: 1,196;
State-funded loans: 912;
State-funded grants: 247.5.
Wyoming;
CWSRF program: $240;
State-funded loans: $0;
State-funded grants: $0.
Legend:
NA=data not available:
Source: EPA's National Information Management System.
Note: Numbers may not add to totals due to rounding.
[End of table]
[End of section]
Appendix III: GAO Contact and Staff Acknowledgments:
GAO Contact:
John Stephenson (202) 512-3842:
Staff Acknowledgments:
In addition to the individual named above; Steven Elstein, Assistant
Director; Mark Braza; Greg Marchand; Tim Minelli; Justin L. Monroe;
Jonathan G. Nash; Alison O'Neill; and Amber Simco made key
contributions to this report.
FOOTNOTES
[1] The Federal Water Pollution Control Act Amendments of 1972 are
commonly referred to as the Clean Water Act.
[2] The District of Columbia does not participate in the Clean Water
State Revolving Fund program.
[3] The CWSRF is one source among many federal and state programs that
local governments can turn to for financial assistance with their water
quality projects. Federal agencies--such as the U.S. Department of
Agriculture's Rural Utility Service, the Department of Housing and
Urban Development, and the Department of Commerce's Economic
Development Administration--also provide grants and loans for the
construction of wastewater and sewer systems. According to EPA, 40
states also have separate grant or loan programs that provide financial
assistance for clean water projects.
[4] EPA also provides grants for nonpoint source projects through its
National Nonpoint Source program.
[5] EPA reports that since July 1, 1987, states have provided over
16,752 CWSRF loans to support 22,674 projects.
[6] Nonpoint source pollution, unlike pollution from industrial and
sewage treatment plants, flows into waterways from many diffuse
sources. Nonpoint source pollution is caused by rainfall or snowmelt
moving over and through the ground and transporting natural and human-
made pollutants, finally depositing them into surface bodies of water
and groundwater.
[7] According to EPA headquarters officials, all 51 CWSRF programs met
this "first use" requirement in the early 1990s. As such, these
officials indicate that this requirement no longer affects states'
funding decisions.
[8] According to EPA, as of June 30, 2005, no state has reported using
the estuary management category of qualifying expenses, but a few
states have reported that a portion of their wastewater treatment and
nonpoint source assistance also supports activities to develop or
implement management plans in federally designated estuaries.
[9] In order to estimate the amount of CWSRF support for the New Sewers
category, EPA collects data on CWSRF support in two additional CWSRF
expenditure categories--Collector Sewers and Interceptor Sewers.
Collector Sewers use pipes to consolidate and transfer wastewater from
sanitary or industrial wastewater sources to an interceptor sewer,
which then carries the wastewater to a treatment facility. Interceptor
Sewer projects include major sewer lines that receive wastewater from
collection sewers and carry the wastewater to a treatment facility or
another interceptor sewer.
[10] In order to estimate the amount of CWSRF support for Sanitary
Sewer Overflow correction, EPA collects data on CWSRF support in two
additional CWSRF expenditure categories--Infiltration/Inflow correction
and Replacement/Rehabilitation of Sewers. Infiltration/ Inflow
correction includes projects to control water penetration into sewer
systems through defective pipes, manholes, drains, and storm sewers.
Replacement/Rehabilitation of Sewers includes projects to reinforce or
rebuild structurally deteriorating sewers.
[11] Under the Clean Water Act, states are required to develop a
Nonpoint Source Pollution Management Plan that serves as a
comprehensive guide to each state's nonpoint source problems, pollution
control programs, and future steps for nonpoint source pollution
control and prevention.
[12] EPA tracks CWSRF expenditure data separately for nonpoint source
projects related to animal production and agricultural cropland but has
reported these data together as Agricultural Best Management Practices.
[13] This compares with U.S. Census figures showing that 41 percent of
the U.S. population lives in areas with fewer than 10,000 people.
[14] A watershed is the land area that drains water into a river system
or other body of water.
[15] Congressional Budget Office, Future Investment in Drinking Water
and Wastewater Infrastructure (Washington, D.C.: May 2002).
[16] Water quality standards comprise two key components--designated
uses and water quality criteria. Designated uses are uses assigned to
water bodies such as drinking water, contact recreation (e.g.,
swimming), and aquatic life support (e.g., fish populations). Water
quality criteria specify pollutant limits that are intended to protect
the designated uses of a water body, such as the maximum allowable
concentration of a pollutant (e.g., iron) or an important physical or
biological characteristic that must be met (e.g., an allowable
temperature range). Water quality criteria can be quantitative
("numeric") or qualitative ("narrative"), and they can include
components such as the frequency and duration of monitoring needed to
determine whether the criteria are being met.
[17] More specifically, the product of the audit is expected to include
(1) financial statements with an opinion (or disclaimer of opinion) as
to whether the CWSRF financial statements are presented fairly in all
material respects in conformity with GAAP; (2) a report on internal
controls related to the CWSRF financial statements that describes the
scope of testing of internal controls and the results of tests; and (3)
a report on compliance that includes an opinion as to whether the state
has complied in all material respects with laws, regulations, and the
provisions of the CWSRF capitalization grants.
[18] According to EPA headquarters officials, starting in fiscal year
2006, the EPA Inspector General will no longer perform audits for these
eight CWSRF programs. Instead, EPA headquarters officials will likely
conduct these audits using a mission contractor.
[19] According to EPA headquarters officials, environmental monitoring
equipment associated with a CWSRF-funded project is an allowable CWSRF
expense.
[20] According to OMB, the PART was developed to assess and improve
program performance so that the federal government can achieve better
results. A PART review helps identify a program's strengths and
weaknesses to inform funding and management decisions aimed at making
the program more effective.
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