Funding guide

What Funding Programs Are Available for Missouri Water and Wastewater Utilities?

Published by Missouri Utility Resource Center

If you are a city clerk, utility superintendent, board member, mayor, or elected official, one of the most common questions you will eventually face is: Are there any grants available for this project?

The answer is usually: Yes, but probably not in the way many people first expect.

Many utility projects are funded through a combination of grants, low-interest loans, local revenue, and other financing tools. Understanding the major funding programs available in Missouri is often the first step toward moving a project from an idea to reality.

Below are several of the most common funding sources Missouri communities consider for water and wastewater improvement projects.

Missouri State Revolving Fund (SRF)

The Missouri State Revolving Fund, often called SRF, is frequently a starting point for major water and wastewater projects.

SRF funding can provide low-interest loans, extended repayment terms, principal forgiveness opportunities for qualifying communities, and affordability assistance in some situations.

Projects commonly funded through SRF may include water treatment improvements, wastewater treatment improvements, collection system rehabilitation, waterline replacements, lift station improvements, storage facilities, and pumping facilities.

For many communities, SRF serves as the foundation of a larger funding package.

Affordability Funding

Some Missouri communities may qualify for affordability assistance through programs connected to the SRF process.

These programs are generally intended to help communities with financial capacity challenges by reducing the amount that must ultimately be repaid.

Availability and eligibility vary by funding cycle and program requirements. For qualifying communities, affordability funding can significantly reduce the long-term financial impact of a project.

Regionalization Funding

Regionalization funding encourages cooperation between neighboring utility systems.

Examples may include interconnections between systems, consolidation efforts, shared treatment facilities, and regional infrastructure improvements.

These programs aim to improve long-term sustainability while reducing duplicate infrastructure costs. Communities considering regional solutions should begin discussions early because planning and coordination often take time.

Community Development Block Grant (CDBG)

CDBG funding can be an important resource for communities addressing public health, safety, and infrastructure needs.

Water and wastewater projects are frequently among the types of projects considered under Missouri community development programs.

Projects may involve water system improvements, wastewater improvements, service extensions, and health or safety concerns.

CDBG opportunities generally involve application cycles and eligibility requirements that communities should review well in advance.

USDA Rural Development

USDA Rural Development remains an important funding partner for many small communities.

Depending on project characteristics and eligibility, USDA funding may include loans, grants, or combinations of grants and loans.

Projects commonly include water distribution systems, wastewater collection systems, treatment facilities, and storage improvements.

Many small communities have delivered major utility improvements using USDA assistance as part of their funding approach.

Local Revenue and Rate Adjustments

While grants receive most of the attention, many successful utility projects ultimately rely on local revenue.

Examples include utility reserves, connection fees, sales tax revenues, capital improvement funds, and utility rate adjustments.

In many cases, local financial commitment helps strengthen the overall funding package.

Start Planning Before Funding Is Needed

One common misconception is that funding should be pursued only after a project has been fully defined.

In reality, communities often benefit from beginning funding discussions early.

Questions worth asking include:

• What problem is the community trying to solve?
• Is there a regulatory driver?
• What is the estimated project cost?
• What funding programs might fit this type of project?
• What planning documents may be required?
• What local financial commitment may be necessary?

The earlier these conversations occur, the more options communities generally have available.

Final Thoughts

There is no universal funding solution for every utility project.

Each community's circumstances are different, and most successful projects involve a combination of planning, financial analysis, engineering evaluation, and funding strategy.

The good news is that Missouri communities have access to a variety of funding resources. Understanding the available programs is often the first step toward making informed decisions about future utility investments.

Educational note: This article is intended for educational purposes only and should not be considered engineering, legal, accounting, financial, or grant application advice. Communities should consult qualified professionals regarding project-specific decisions.