Board approves SRF amendments, places five projects on state plan and awards loans and grants

The South Dakota Board of Water and Natural Resources approved a series of funding and planning actions on June 25, including amendments to the 2025 state revolving fund (SRF) intended‑use plans to request emerging contaminant funds and transfer available clean‑water SRF amounts to the drinking‑water SRF where demand is higher.

Staff recommended changes to the narrative of the 2025 Clean Water SRF and Drinking Water SRF intended‑use plans to enable use of remaining emerging contaminant allocations and to transfer clean‑water SRF portions to drinking‑water SRF where eligible projects exist, Andy (staff) told the board. The board moved, seconded and approved the amendment request following staff presentation.

Why it matters: The amendment allows the department to apply for and direct federal emerging‑contaminant allocations to projects that can use the funds this year, and to shift clean‑water SRF dollars to drinking‑water uses with higher demand.

The board also reviewed and placed five projects onto the 2026 State Water Facilities Plan. Staff described project scopes, estimated loan amounts and eligibility criteria for each: Crooks will pursue a second connection to Minnehaha Community Water Corporation (estimated $3,800,000 loan at 4% for 30 years); Millbank seeks a new treatment plant to address secondary contaminants (estimated $10,000,000 at 3.75% for 20 years); Randall Community Water District proposed future capacity upgrades (listed on the state water plan but not eligible for drinking‑water SRF financing; project total estimated $31,907,000); Webster requested full meter replacement and remote read systems (estimated $908,000 at 2.75% for 10 years); and White proposed storm sewer improvements (estimated $325,000 at 4% for 30 years). "Projects placed onto the plan at this meeting will remain on the facilities plan through December 2027," staff said.

Board action on awards and loans: The board approved staff recommendations to: award a $51,900,000 Clean Water SRF loan to the City of Sioux Falls for clarifier replacements and associated upgrades (3.75% interest, 20‑year term) and to approve a $2,500,000 Clean Water SRF loan to the City of Hecla with principal forgiveness of up to 80% not to exceed $2,000,000, contingent on bond resolution and surcharge adoption. Motions on both items were moved, seconded and carried by voice vote.

ARPA reallocation and solid‑waste action: Staff reported $206,749.07 of unobligated American Rescue Plan Act (ARPA) funds and recommended awarding those funds to the Shared Resources joint project (a partnership of Minnehaha Community Water Corporation and the Big Sioux Community Water System) to meet ARPA expenditure deadlines. The board approved awarding the additional ARPA grant dollars to Shared Resources, bringing that project's ARPA total to $51,148,897.07.

The board also approved a solid‑waste management program award to the Department of Agriculture and Natural Resources for a PFAS firefighting‑foam collection and disposal program, a 100% grant not to exceed $250,000 under authority of the 2026 omnibus bill (Senate Bill 37).

De‑obligations and administrative items: At the borrowers' requests, the board rescinded prior loan resolutions and de‑obligated three loans: Dupree (rescind $1,314,452 Clean Water SRF loan C461247203), Hecla (rescind $2,500,000 loan C461276‑03) and Presho (rescind $105,000 consolidated loan). The board also approved updated authorized representative designations for staff and new joint powers agreements with planning districts to support SRF application processing and Davis‑Bacon monitoring.

What the board said: Chair called the approvals routine and thanked staff for coordination with communities. Staff emphasized the need to obligate ARPA funds by federal deadlines and noted limited remaining eligible projects that can absorb some subsidy categories.

Next steps: Projects placed on the State Water Facilities Plan will remain eligible through December 2027; loans are contingent on borrower actions such as bond resolutions and surcharge adoptions. The board noted additional funding amendments and awards could appear at upcoming meetings.

Ending: The board approved the slate of amendments, placements, awards and rescissions and moved on to a presentation of the 2026 surface water quality assessment report.