State Water Board outlines 2025 Drinking Water SRF intended use plan and SAFER fund-expenditure priorities; staff propose expanded aid for failing and at‑risk, 

SACRAMENTO — At a July 15 workshop the State Water Resources Control Board reviewed two related funding proposals: the 2025 Drinking Water State Revolving Fund intended use plan (IUP) and the fund‑expenditure plan (FEP) for the Safe and Affordable Drinking Water Fund that supports SAFER program activities.

Mike Downey and Lisa Hong of the Division of Financial Assistance led the IUP presentation with Kristen Appold co-presenting grant and principal‑forgiveness proposals. The IUP proposes a loan capacity target of roughly $300 million per year and a $50 million maximum grant/principal‑forgiveness cap for eligible projects above 200 connections. Staff said the cap is intended to allow sustainable loan flows for the SRF while ensuring broad distribution of funds.

Staff proposed expanding grant eligibility and award amounts to address hexavalent chromium (Chrome‑6) exceedances and emerging‑contaminant treatment needs. The IIJA (Infrastructure Investment and Jobs Act) and related federal pots earmark funds for emerging contaminants; staff said California expects approximately $183 million in EC (emerging contaminants) funds in 2025 and proposed raising the maximum EC award to $25 million for large systems and removing per‑connection limits for disadvantaged or small systems.

Kristen Appold outlined principal‑forgiveness and grant priorities: prioritize failing systems, continue support for SAFER, expand eligibility to at‑risk systems for certain categories, and propose a tiered cap for very small systems (under 200 connections) to respect language in some state bond funds. Lisa Hong said the 2026 fiscal year is the last year of IIJA SRF appropriations; staff urged applicants to apply as quickly as appropriate to ensure eligible uses are funded.

Separately, the draft FEP presented by staff (Sampole, Division of Financial Assistance) proposed new guidance for serving communities reliant on domestic wells and state small water systems, including: (1) a three‑part strategy to share data, fill funding gaps coordinated with local mitigation programs (GSAs/management zones) and to promote long‑term solutions such as consolidation or decentralized treatment; (2) clearer eligibility guidance for interim (emergency) assistance, technical assistance (TA) milestones, and a recommendation to increase the board’s urgent‑needs cap from $500,000 to $1,000,000; and (3) a proposed two‑year limit on state interim assistance, with case‑by‑case flexibility if households are actively progressing toward long‑term solutions.

Staff said TA demand has grown rapidly: more than 400 planning work plans are active and many extend multiple years. The FEP would dedicate additional SAFER state resources to expand TA agreements, accelerate planning and protect interim assistance for domestic wells and state smalls. Staff warned that federal funding timelines (some IIJA pots expire in 2026) create urgency for project readiness.

Public commenters included municipal officials representing systems with Chrome‑6 exceedances (Coachella, Los Banos), water‑sector trade groups and advocacy organizations. They urged expedited timelines and clarity on how much state grant assistance will be available for large Chrome‑6 projects, and requested staff outreach to applicants whose projects are near readiness.

Board members pressed staff on how at‑risk systems would be prioritized, how TA capacity would be measured and increased, and whether stricter eligibility rules would unintentionally delay projects. Staff said they would coordinate further with Division of Drinking Water staff and with local agencies (GSAs, counties) and that written public comments on the IUP are due July 28 with board adoption of the final IUP planned for Aug. 19. The SAFER FEP comment period closes July 31 and staff plans to return to the board in August for final action.