Sanitary and Storm Sewer Project Funding
The Department of Environment and Natural Resources is committed to improving and maintaining wastewater treatment and storm water management infrastructure throughout the state. Grants and low-interest loans, offered through the Board of Water and Natural Resources, are available for these purposes.
Funding for sanitary and storm sewer projects is provided through the Clean Water State Revolving Fund program and the Consolidated Water Facilities Construction program. Applicants should expect to receive some portion of funding as a loan from the Clean Water SRF program. As a result, applicants must satisfy all requirements associated with the Clean Water SRF program.
State Water Plan
Sanitary and storm sewer projects requesting funding must be on the State Water Facilities Plan portion of the State Water Plan. State Water Plan applications must be postmarked or received at the Department of Environment and Natural Resources on or before the first day of October. Applications for amendment onto the State Water Facilities Plan are considered on a quarterly basis and must be postmarked or received by the department on or before the first day of February, May and August. A preliminary engineering report or facilities plan must accompany the application.
Top of page
Small Community Planning Grants
Communities of 2,500 or less can receive a Small Community Planning Grant to assist in the preparation of a preliminary engineering report or facilities plans. Small Community Planning Grant applications can be submitted at any time.
In order to be eligible for sanitary and storm sewer funding, a project must:
1) Be included on the State Water Facilities Plan prior to the application deadline; and
2) Be sponsored by one of the following entities: a special purpose district that has the authority to construct a water resources project; a state agency or general purpose government such as a municipality, county, or township; a federally recognized Indian tribe; or a nonprofit corporation.
Application Deadlines and Award Dates
Sanitary and storm sewer project applications are considered on a quarterly basis and must be postmarked or received by the department on or before the first day of January, April, July and October. The department will notify applicants of the date for the board meeting at which applications will be considered by the board. Board meeting dates are public noticed and available on the DENR website.
Additional Subsidy – Grants and Principal Forgiveness
Applicants that meet the minimum established residential wastewater rates may receive a grant or loan principal forgiveness. Adoption of minimum monthly utility rates provides no guarantee of an applicant receiving additional subsidy.
The minimum monthly residential wastewater rates necessary for an applicant to be eligible for additional subsidy are $30 based on 5,000 gallons usage or a flat fee for municipalities and sanitary districts and $40 based on 5,000 gallons usage or a flat fee for all other applicants.
Grant assistance may be awarded to applicants not meeting the minimum established rates for economic development opportunities, expansion into new areas, regionalization or consolidation of facilities, or other unique situations that may require special consideration.
The minimum rates are established in sections Administrative Rules of South Dakota 74:05:07:01(12) and 74:05:08:01(13).
Interest Rates and Terms
The board sets interest rates for the program and makes adjustments to the rates on an as-needed basis. By Administrative Rule, it is required that to amend the interest rates they must be included as part of the posted board meeting agenda.
Clean Water SRF Program Requirements
Financial Statements/Annual Reports - the applicant must submit the most recent audited financial statements or unaudited annual reports. This financial information must include a detailed break-down of the revenue fund pledged toward repayment of the loan.
Bond/Legal Counsel – political subdivisions must retain bond counsel when the application is submitted to the department. Bond counsel and legal counsel will prepare the loan documents for the applicant and all necessary resolutions and ordinances. An opinion will be issued by bond counsel on the applicant's ability to incur Clean Water SRF debt. The Clean Water Act prohibits the department from loaning funds to private, non-profit entities.
Facilities Planning Process - A Clean Water Facilities Plan must be prepared and submitted as part of the Clean Water SRF application. This is an engineering evaluation that describes the need for the proposed supply, treatment, storage or distribution project based on present conditions and future needs; evaluates the costs and adequacies of appropriate alternatives; identifies potential environmental impacts of the proposed project; and provides the selection and justification of a final alternative.
Several state and federal agencies must be given the opportunity to review and comment on the proposed project. These agencies are SD Game, Fish and Parks, US Fish and Wildlife Service, USDA Natural Resources Conservation Service, US Army Corps of Engineers and SD State Historic Preservation Office.
The facilities planning process requires a public hearing. A "Notice of Public Hearing" should be published at least 10 days prior to the hearing. The publication shall include a description of the project, the amount of SRF loan to be borrowed and the interest rate and term of the loan. Minutes must be kept at the public hearing and should include a summary of any comments received on the proposed project. A copy of the affidavit of publication and meeting minutes must be submitted as part of the final Facilities Plan.
Funding for Sanitary and Storm Sewer Projects of $250,000 or Less
Sanitary and storm sewer projects with a total cost of $250,000 or less may apply using the Small Water Facilities Funding application. These applicants are not subject to the Clean Water SRF program requirements.
Funding for Sanitary and Storm Sewer Projects That are Not Eligible for Clean Water SRF Loan
Sanitary and storm sewer projects that are not eligible for a Clean Water SRF loan may also apply using the Small Water Facilities Funding application. Common examples of projects not eligible for a Clean Water SRF loan are projects for private entities or projects to provide pre-treatment of industrial wastewater.
Rules and Regulations
Rules concerning the Consolidated Water Facilities Construction program may be found in the Administrative Rules of South Dakota 74:05:07. Rules and regulations concerning the Clean Water SRF Program may be found in the Administrative Rules of South Dakota 74:05:08 and the federal Clean Water Act. For copies of these rules or the Act, you may contact:
Department of Environment and Natural Resources
Division of Financial and Technical Assistance
Joe Foss Building
523 East Capitol
Pierre, South Dakota 57501
Phone: (605) 773-4216
Fax: (605) 773-4068
Email: Mike Perkovich
Top of page