All 50 States and Puerto Rico have established and are implementing DWSRF programs through receipt of a capitalization grant. In FY 07, States made 578 loans to systems for a total of $1.6 billion dollars to conduct infrastructure improvement projects. Of the total number of loans, 72 percent went to small water systems that serve 10,000 persons or fewer. States also used funds to prevent drinking water contamination through source water protection and enhanced system management. In FY 07 and in FY 08, four awards were made to Territories and 38 awards were made to Tribes to conduct infrastructure improvement projects that are needed to achieve or maintain compliance with SDWA requirements. In FY 09, States, Tribes, and Territories will continue to receive funding to support infrastructure improvement projects.

Uses and Use Restrictions

Capitalization grants are made available to each State and Puerto Rico for the purpose of establishing a DWSRF for providing assistance to drinking water systems for infrastructure improvements.

The capitalization grant is deposited in the State's DWSRF, and is used to provide loans and other types of financial assistance to eligible public water systems.

A State may elect to use up to 31% of the capitalization grant for other eligible activities, including 4% for administration of the program.

States may also elect to transfer up to one-third of the DWSRF capitalization grant to the Clean Water State Revolving Fund (CWSRF) or an equivalent amount from the CWSRF to the DWSRF program.

Grants are also made available to Federally Recognized Indian Tribal Governments, U.S Territories, and the District of Columbia.

Assistance agreement awards under this program may involve or relate to geospatial information.

Further information regarding geospatial information may be obtained by viewing the following website: http://geodata.epa.gov.

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Eligibility Requirements

Applicant Eligibility

States, the District of Columbia, U.S.

Territories or Possessions (the Commonwealth of Puerto Rico, Virgin Islands, Mariana Islands American Samoa, and Guam), and Federally Recognized Indian Tribal Governments are eligible for grants from the program.

For certain competitive funding opportunities under this CFDA description, the Agency may limit eligibility to compete to a number or subset of eligible applicants consistent with the Agency's Assistance Agreement Competition Policy.

Beneficiary Eligibility

States, U.S. Territories or Possessions (the Commonwealth of Puerto Rico, Virgin Islands, Mariana Islands American Samoa, and Guam), Federally Recognized Indian Tribal Governments, local, and intrastate.

Credentials/Documentation

To receive a grant, an applicant enters into an agreement with the EPA Regional Administrator which shall include, but are not limited to, the requirements set forth in Section 130 of the SDWA. Recipients must follow OMB Circular No. A-87, "Cost Principles for State, Local and Indian Tribal Governments."

Aplication and Award Process

Preapplication Coordination

States are required to prepare and provide for public comment on a plan identifying the intended uses (Intended Use Plan, or IUP) of the funds in the DWSRF and how those uses support the goals of the DWSRF.

The IUP is to be submitted no later than the application.

An environmental impact statement is not required prior to grant award; however, a State environmental review process must be applied to all subsequent State assistance for drinking water systems.

Regarding pre-application/pre-proposal assistance with respect to competitive funding opportunities under this program description, EPA will generally specify the nature of the pre-application/pre-proposal assistance, if any, that will be available to applicants in the competitive announcement.

For additional information, contact the individual(s) listed as "Information Contacts" or see Appendix IV of the Catalog.

This program is eligible for coverage under E.O.

12372, "Intergovernmental Review of Federal Programs." An applicant should consult the office or official designated as the single point of contact in his or her State for more information on the process the State requires to be followed in applying for assistance, if the State has selected the program for review.

Application Procedures

The standard application forms as furnished by the Federal agency and required by OMB Circular No. A-102 must be used for this program. EPA requires final applications to be made on Standard Form 424. Requests for application kits must be submitted to the Environmental Protection Agency, Grants and Interagency Agreements Management Division, 1200 Pennsylvania Avenue, N.W., Mailcode 3903R, Washington, DC 20460 or through the appropriate Regional Office listed in Appendix IV of the Catalog. Additional information on the EPA grant package can be found at: http://www.epa.gov/ogd/grants/how_to_apply.htm. Grants for Tribes, U.S. Territories, and the District of Columbia are selected based on funding priorities established by EPA Regional Offices. States must certify that they have the legal authority to receive a capitalization grant and that they have the legal authority to operate the program. States must provide assurance in their applications that they have the legal, managerial, technical and operational capabilities to administer the DWSRF program competently and that they will comply with all applicable Federal cross-cutting authorities and Federal statutes. Applicants may be able to use http://www.grants.gov to electronically apply for certain grant opportunities under this CFDA.

Award Procedures

A grant application is reviewed by the appropriate Regional Office, and if approved, the grant is awarded by the Regional Administrator under a delegation of authority from the Administrator of EPA. EPA Headquarters retains the authority to review certain applications or parts thereof. For competitive awards, EPA will review and evaluate applications, proposals, and/or submissions in accordance with the terms, conditions, and criteria stated in the competitive announcement. Competitions will be conducted in accordance with EPA policies/regulations for competing assistance agreements.

Deadlines

Applications should be submitted to the appropriate Regional Office no later than June 30 of the year following the year of appropriation to allow sufficient time for review and processing prior to the September 30 reallotment deadline.

Authorization

Safe Drinking Water Act (SDWA) Amendments of 1996, Section 130, Public Law 104-182.

Range of Approval/Disapproval Time

Approval time averages 45 days.

Appeals

Assistance agreement competition-related disputes will be resolved in accordance with the dispute resolution procedures published in 70 FR (Federal Register) 3629, 3630 (January 26, 2005). Copies of these procedures may also be requested by contacting the individual(s) listed as "Information Contacts." Disputes relating to matters other than the competitive selection of recipients will be resolved under 40 CFR 30.63 or 40 CFR 31.70, as applicable.

Renewals

For those portions of the applicant's program that do not change from year to year, a subsequent grant application may incorporate by reference relevant portions of the previous year's application which have not changed.

Assistance Considerations

Formula and Matching Requirements

The funds available for allotment to State DWSRF programs are those funds appropriated by Congress under the Safe Drinking Water Act (SDWA 1452; 40 CFR 35.3540-35.3585). EPA allots funds to each State based on the State's proportional share of total eligible needs reported for the most recent Drinking Water Infrastructure Needs Survey (which is conducted every four years). The minimum proportional share that each State can receive is 1% of total funds available to States. EPA reserves up to 0.33 percent of the funds available for allotment to the States to provide grants to the U.S. Territories (Virgin Islands, Mariana Islands American Samoa, and Guam). The SDWA also requires the Administrator to reserve 1 percent of the funds available for allotment to the States to provide grants to the District of Columbia. The SDWA also allows EPA to reserve funds for national set-asides that include: up to 1.5 percent of the national appropriation for grants to Indian Tribes, and funding for health effects studies, small system technical assistance, and monitoring of unregulated contaminants. The required State match is 20 percent of the amount of the capitalization made to the State. States must also provide a match or demonstrate a credit for state funded eligible activities to receive Federal funds for certain program support activities. For additional information go to http://www.epa.gov/safewater/dwsrf/allotments/index.html.

Length and Time Phasing of Assistance

Funds are available for obligation during the fiscal year in which they are allotted and during the following year. The term of the grant shall be determined at the time of award. States must agree to enter into binding commitments with loan recipients to provide financial assistance from the DWSRF in an amount equal to the sum of Federal assistance, less amounts used by the State for eligible set-aside purposes, and the State match. States are also required to agree to commit and expend all funds in the DWSRF as efficiently as possible, and in a timely manner.

Post Assistance Requirements

Reports

States shall provide biennial reports to the Regional Administrator in accordance with the schedule established in the grant agreement (generally not later than 90 days after the end of the second fiscal year during which the payments were received).

The biennial report shall describe how the State has met the goals and objectives for the preceding two fiscal years as identified in its intended use plans for those periods, including identification of loan recipients, loan amounts, and loan terms and similar details on other forms of financial assistance provided from the DWSRF.

For grants to Tribes and U.S.

Territories, procedures for accounting, auditing, evaluating, and reviewing any program for activities in whole or in part shall be governed by regulations at 40 CFR Parts 31 and 35, "Environmental Program Grants for Tribes," with reports as required by the specific terms of the agreement.

Audits

Grants and cooperative agreements are subject to inspections and audits by the Comptroller General of the United States, the EPA Office of Inspector General, other EPA staff, or any authorized representative of the Federal government. Reviews by the EPA Project Officer and the Grants Specialist may occur each year. In accordance with the provisions of OMB Circular No. A-133 (Revised, June 27, 2003), "Audits of States, Local Governments, and Nonprofit Organizations," nonfederal entities that expend $500,000 or more in a year in Federal awards shall have a single or a program-specific audit conducted for that year. Nonfederal entities that expend less than $500,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in OMB Circular No. A-133. States must comply with the provisions of the Single Audit Act Amendments of 1996, and the OMB Circular No. A-133 and Compliance Supplement. States are also encouraged to conduct annual independent audits. The audit of the fund to be prepared by the State or an independent auditor must be in accordance with the standards of the Government Accountability Office (known as the Generally Accepted Government Auditing Standards). To the extent that the set-asides are used for project purposes that must be repaid, or are directly related to the DWSRF (e.g., administration) or are revolving funds themselves, they must be part of an audited opinion(s). The audits must provide an auditor's opinion on the DWSRF financial statements, a report on internal controls and a report on compliance with laws and regulations. Those set-aside funds that are not loaned out may be audited in conjunction with audits conducted under the Single Audit Act, as described in OMB Circular No. A-133 and OMB's Compliance Supplement for Single Audits of State and Local Governments.

Records

Financial records, including all documents to support entries on accounting records and to substantiate changes to each grant, must be kept available to personnel authorized to examine EPA grant accounts. All records must be maintained for three years from the date of submission of the final expenditure report. If questions still remain, such as those raised as a result of audit, related records should be retained until the matter is completely resolved. As part of the annual review conducted by the Agency to assess a State's performance against activities identified in the intended use plan and biennial report, and to determine compliance with the terms of the capitalization grant agreement, the State or assistance recipient shall make available to EPA such records as the Regional Administrator reasonably requires to review and determine State compliance with the requirements of the SDWA.

Financial Information

Account Identification

68-0103-0-1-304; STAG.

Obigations

FY 07 $788,194,200; FY 08 $829,029,000; and FY 09 est. $838,167,000.

Range and Average of Financial Assistance

States: $8,146,000 to $66,424,000/fiscal year; $16,105,000/fiscal year. Tribes: $4,000 to $1,600,000/fiscal year; $320,000/fiscal year. Territories: $249,200 to $8,229,300/fiscal year; $2,189,000/fiscal year.

Regulations, Guidelines, and Literature

EPA Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments (40 CFR Part 31) and Drinking Water State Revolving Funds (40 CFR Part 35, Subpart L). Additional program information, including contact information for State program managers, is available online at http://www.epa.gov/safewater/dwsrf.html.

Information Contacts

Regional or Local Office

See EPA Regional Offices listed in Appendix IV of the Catalog, or online.

Headquarters Office

Peter Shanaghan, Infrastructure Branch (4606M), Drinking Water Protection Division, Office of Groundwater and Drinking Water, Environmental Protection Agency, 1200 Pennsylvania Avenue, N.W., Washington, DC 20460. Telephone: (202) 564-3848; Fax: (202) 564-1836; E-mail: shanaghan.peter@epa.gov.

Criteria for Selecting Proposals

The evaluation and selection criteria for competitive awards under this CFDA description will be described in the competitive announcement.