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The U.S. Environmental Protection Agency (EPA) issued final guidance March 2 to its regional offices on how it will award and administer capitalization grants to state revolving funds under the newly enacted American Recovery and Reinvestment Act (ARRA). The guidance provides States with the requirements they need to follow in order to access and use the funds available through the stimulus package for the Clean Water and Drinking Water State Revolving Fund Programs (CWSRF and DWSRF). The stimulus provided $4 billion to the CWSRF and $2 billion for the DWSRF. The final guidance is available on the NACWA website by clicking here .

This final guidance tracks closely with the draft guidance that NACWA distributed last month through its white paper, which was distributed via Legislative Alert 09-05 on February 20th. Some of the highlights include:

• To receive funds, states must provide details on their “intended-use plans.” They must provide EPA with detailed information on every project, including a description, the amount of assistance, and an estimate of the number of jobs that will be created or retained.

• To accelerate the process for getting money to the States, EPA will allow states to apply for conditional grants and partial grants based on draft “intended use plan” submissions if all other components of the program are in place.

• States may blend funds from the ARRA with “base” funds from previous appropriations as long as they meet applicable requirements of the ARRA for the entire project. However, the funds must be separately managed and tracked with States required to report on a weekly basis to EPA how funds are being used. This information will be posted on www.recovery.gov, the government-wide, web-based tracking system for the stimulus.

• States will have up to 180 days to certify that they do not have sufficient eligible projects to meet the 20% set aside requirement for green and environmentally innovative projects before they can use the funds for traditional water and wastewater projects.

• EPA intends to issue additional guidance on how States will need to implement the requirements of “Buy American” provisions contained in the ARRA. The provision requires that none of the appropriated funds may be used for the construction, alteration, maintenance, or repair of a public building or public work unless all the iron, steel, and manufactured goods used in the project are produced in the United States, unless the recipient provides a waiver to EPA or compliance would be inconsistent with U.S. obligations under international agreements.

• States must demonstrate by February 17, 2010 that funds have been obligated for projects that are under contract and ready for construction or the EPA Administrator will deobligate a State’s SRF funds and reallocate them to States that can show they have projects that can go to construction within 120 days.

NACWA will update its white paper to reflect key changes in the final guidance and will continue to track the implementation of the stimulus and provide members with information as it becomes available. For more information, contact: Patricia Sinicropi at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or Byron DeLuke at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .