Kansas Water Office outlines HB 2302 grant awards and rules; demand far outpaces funds

Victoria Asbury, director-level staff from the Kansas Water Office, told the House Agriculture and Natural Resources Budget Committee on March 6 that the agency is implementing House Bill 2302 (2023), a multi-year funding package designed to help municipalities and special water districts with planning and construction of water infrastructure.

Under HB 2302 the legislature provided an additional $35 million from the state general fund to the state water plan fund over five years; the Water Office described annual base funding and statutory allocations for two grant streams. Asbury said the statutory breakdown directs $18 million to remain in the state water plan fund for general water projects and programs, $5 million to a technical assistance fund and $12 million to a water projects fund; the agency described other appropriations and one-time increases that altered totals for FY2025.

For fiscal year 2025 the legislature added $10 million that lifted the technical assistance total to $7.5 million and the water projects total to $19.5 million, Asbury said. The Water Office said the technical assistance fund covers planning, engineering and preconstruction work (including grant and loan application preparation) and caps awards at $1 million per applicant. The water projects fund covers construction, repair, maintenance and loan assistance limited to two KDHE loan programs (Public Water Supply Loan Fund and Kansas Pollution Control Revolving Fund) and caps grants at $8 million per applicant.

Asbury described the Water Office’s evaluation criteria: statutory priority for municipalities with fewer than 2,000 residents, community factors (public-health and socioeconomic conditions), emergent needs, regionalization benefits and incorporation of conservation or climate considerations. She said projects that create a backup or regionalized supply or address drinking-water contaminants or distribution failures generally ranked higher.

Demand has far outpaced available funding. In the first year (FY2024) the Water Office received 309 applications requesting roughly $380 million and awarded 34 grants totaling $18 million. For FY2025 the office received 269 applications requesting approximately $233 million and awarded 70 grants totaling just over $26 million (39 technical-assistance grants and 31 water-projects grants). Asbury pointed to examples: Jewell County Rural Water District received a technical-assistance award to support design of a water tower and test wells after detecting elevated nitrates; the City of Ellis received technical assistance for distribution modeling to correct pressure deficits and reduce losses; other awards included a water-tower rehabilitation to address lead-painted coatings.

Asbury emphasized the program operates on a reimbursement model: awardees submit quarterly reports and invoices and receive payments after the Water Office verifies allowable expenditures. The office also contracts technical reviewers to check midpoints and completion of projects.

Committee members asked about specific statutory rules. Representative Roth questioned the requirement that communities must have made five years of loan payments before qualifying for loan-assistance grants; Asbury said the five-year rule is statutory rather than an agency policy; she described it as evidence of local "skin in the game." Lawmakers also asked about emergency bridging finance for communities facing imminent contamination or infrastructure failure; Asbury said other state and federal programs (e.g., KDHE, Department of Commerce CDBG funds) may provide options but the Water Office’s HB 2302 grants are not structured to provide immediate up-front bridge financing.

Ending: The Water Office said its application window generally opens in July and closes in September, with award announcements occurring in the winter; the agency recommended small utilities and special districts use the program for preconstruction planning and to leverage other state and federal funds. Asbury directed interested parties to the Water Office website for guidelines, application materials and frequently asked questions.