A Fairer Funding Stream
Reforming the Clean Water State Revolving Fund Can Equitably Improve Water Infrastructure Across the Country
The Clean Water State Revolving Fund (CWSRF) provides billions of dollars in federal funding for local wastewater and stormwater systems that provide safe sanitation, healthy waterways, and protection from flooding. Given the importance of these resources, it’s critical that the programs provide equitable access to financial assistance to all communities across the country—no matter where they’re located or who lives in them.
To better understand the distribution of CWSRF funding, NRDC and EPIC analyzed data on CWSRF assistance from 2011 to 2020 and found that while municipalities with more water quality violations and lower median incomes are statistically more likely to receive assistance, smaller municipalities and those with larger populations of color are statistically less likely to receive CWSRF assistance.
States’ CWSRF policies must be reformed to provide all potential recipients with an even playing field. The goal of clean water for all will remain out of reach until every community has a fair and equitable shot at receiving financial assistance through the nation’s largest clean water infrastructure program.
Our key findings and policy recommendations are summarized here.
Key findings:
Communities of color often bear the greatest burden of inequitable access to clean water infrastructure and have the most severe need for CWSRF resources. However, our analysis found municipalities with larger white populations were more likely to receive CWSRF assistance. An increase of 10 percent in the proportion of residents that identify as non-Hispanic white was associated with a 0.31-percentage-point increase in the likelihood of receiving an award.
Small towns often need federal financial support due to limited local funds, but they may face hurdles accessing assistance due to a lack of capacity. We found municipalities with larger populations have a greater likelihood of receiving CWSRF assistance, indicating that state agencies may not be adequately helping small communities access funding.
State CWSRF programs are more likely to direct funds to lower-income communities and those with more Clean Water Act violations. These results are consistent with the CWSRF program’s goal of investing resources in communities that need help upgrading infrastructure and coming into legal compliance. We found an additional $10,000 in median household income from the average was associated with a 1.45-percentage-point lower likelihood of receiving assistance. Moving from zero to 1-10 water quality violations increased the likelihood of receiving an award by 8.7 percentage points on average; municipalities with more than 10 violations were even more likely to receive assistance.
Policy Recommendations
Congress should continue to increase investment in the program to ensure that adequate funding is available for communities in need.
States should assign higher priority to projects in underserved communities, ensure that those projects qualify for the most favorable award terms, and distribute more funding in the form of grants or forgivable loans.
Program administrators must be more proactive in promoting the availability of these critical funds, coordinating with other sources of infrastructure funding, and providing hands-on assistance to help communities apply.
