City says state funding appears available for harbor, road and lead service line work; bidding planned for scattered-site LSL replacements

City staff told the council that state Department of Natural Resources (DNR) funding — including Safe Drinking Water and Clean Water funds supported by federal infrastructure dollars — appears to be available for several Two Rivers projects this year, including harbor work, the Sixteenth Road reconstruction, and a scattered-site lead service line (LSL) replacement program.

Staff said the DNR has not finalized all eligibility lists but has told the city it “scored real well” and should expect funding for the LSL program. The city reported it expects principal forgiveness on portions of the private-side LSL work and that some mains may qualify for principal forgiveness as well; staff used the phrase “20% principal forgiveness” when referring to mains, and said the private-side assistance could be in the neighborhood of $2,500 per household for eligible scattered-site replacements.

Council and staff discussion also noted that the lead-and-copper rule has been the subject of a national legal challenge by the American Water Works Association, and that program timing and federal support could affect local implementation plans. Staff told council they plan to proceed to bid the scattered-site LSL project and will await final DNR guidance on funding and reimbursement timing.

Why it matters: Replacing lead service lines is costly for households and municipalities. City staff said the combination of state DNR funds, principal forgiveness and federal infrastructure support makes the upcoming projects feasible to bid and implement this year.

Ending: Staff said they will continue to coordinate with the DNR on final eligibility and will move forward with procurement for the scattered-site LSL work once guidance is confirmed.