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Board adopts FY25–26 Clean Water SRF intended use plan; Prop 4 uncertainty leaves water recycling funds conditional
Summary
The board approved the State's Clean Water State Revolving Fund FY25–26 intended use plan, allocating federal and state SRF allotments, restoring water‑recycling grant caps to $15 million per project and advancing a fundable list of loans and grants while noting that Proposition 4 bond appropriations remain subject to the state budget process.
The State Water Resources Control Board adopted the Fiscal Year 2025–26 Clean Water State Revolving Fund Intended Use Plan (IUP) on Aug. 5, approving a fundable list of loan projects and grant priorities while noting that water recycling construction grants depend heavily on projected Proposition 4 appropriations. Lisa Hong of the Division of Financial Assistance summarized federal allotments, an in‑house application backlog and staffing constraints that limit how many applications can be processed even when money is available.
Staff proposed adding 12 loan projects to the fundable list (scenario E, which includes the Town of Windsor) and restoring the water recycling construction grant maximum to $15 million per project pending Prop 4 appropriation. The proposal also continues $50 million grant maximums for disadvantaged community small‑community wastewater projects addressing violations or septic‑to‑sewer conversions, and sets aside $20 million in Clean Water SRF principal forgiveness for stormwater projects. Staff recommended transferring $15 million earmarked for emerging contaminants to the Drinking Water SRF this cycle because current demand sits on the drinking‑water side; staff said funds could be reallocated later if clean‑water EC projects materialize.
Public commenters included Community Water Center and other advocates who urged increased technical assistance funding for septic‑to‑sewer projects; Tribal leaders and partners requested loan forgiveness for the Quartz Valley Indian Reservation's proposed Scott River Headwaters acquisition; utilities and trade groups asked for clarity on timelines and CalWaters integration. The board approved the IUP with a change sheet and asked staff to continue outreach and to coordinate the CalWaters rollout with applicant assistance.
