The U.S. Department of Agriculture (USDA) works to enhance the livability of rural communities. Its broad range of services to enhance the quality of life for rural residents can include support for onsite wastewater treatment systems.

Such funding falls under the Rural Development Mission Area within the USDA, which includes three agencies: Rural Housing Service (RHS), Rural Business – Cooperative Service (RBS), and Rural Utilities Service (RUS).

Altogether, Rural Development provided about $42.5 billion in financial assistance in fiscal year 2010 (ending Sept. 30, 2010), including funds authorized under regular programs and the American Recovery and Reinvestment Act.

Variety of offerings

Although this article primarily describes the Water and Waste Disposal program administered by RUS, other Rural Development programs are also mentioned. The majority of projects funded are for centralized or public
systems, but each of these agencies can potentially provide funds for various entities to construct onsite wastewater systems, including individual and cluster systems.

RBS administers a number of programs, not all of which pertain to onsite wastewater treatment. However, the Business and Industry Loan Guarantee program enables business owners to receive guaranteed loans through banks to build or improve their assets, including commercial or industrial facilities that could include onsite wastewater treatment.

The Rural Business Enterprise Grant program finances construction of facilities that can attract business development. This includes industrial parks and attendant utilities, which could include onsite systems.

RHS can provide assistance for construction and improvements to single-family homes and multi-family homes through loans and grants to individuals and developers. For example, a homeowner could apply for funding through the program to construct an onsite wastewater treatment system for the residence through the single-family loan, grant, or loan guarantee programs. A developer could include onsite treatment as part of the cost of construction or improvements to a multi-family structure.

Finally, RHS includes the Community Facilities (CF) program, which
can finance the development of schools, hospitals, community centers and other facilities. Recipients of CF funds must be public bodies, tribes or not-for-profit corporations.

Funding utility projects

The RUS provides funding for electric, telecommunication and water infrastructure in rural areas. The program within RUS likely to be of greatest interest to the onsite wastewater community is the Water and Waste
Disposal program.

Through this program loans, grants and loan guarantees for development or improvements to water and wastewater systems are available to public bodies, tribes, and not-for-profit corporations. Installation or improvement of individual or cluster onsite wastewater systems is allowed as an eligible cost, as long as the systems are centrally managed according to 7 CFR 1780.9 (g).

Requirements for obtaining funds for use in onsite treatment facilities under the Water and Waste Disposal program include:

Approval by the agency in the form of an agreement between the applicant and the individual users of the system.

Adequate loan security or collateral (for loan funds).

Indebtedness of an individual user to the applicant must not exceed the useful life of the facilities installed, and the interest rate charged must not exceed the rate charged to the applicant by the agency.

Easements for ingress to and egress from the installed facilities must allow the applicant to operate and maintain onsite facilities without additional permissions from users.

Adequate means must be provided for the applicant to deny service in case of non-payment.

A case in point

These rules essentially require the system to be managed according to management Model 5, Responsible Management Entity Ownership Model, described in the U.S. EPA document, Voluntary National Guidelines for Management of Onsite and Clustered (Decentralized) Wastewater Treatment Systems. This model describes the case where a central entity owns, operates, and maintains the decentralized system.

An example of a centralized system that was financed by RUS under the Water and Waste Disposal program was the Southern Iowa Rural Water Association (SIRWA) project in Shannon City. Given a population of only 70, the city had no easy way to pay for wastewater system improvements.

The town had been receiving water service from SIRWA and asked if that association would help by providing central management of a decentralized wastewater system in the town. RUS funded construction of a wastewater system, including a septic tank and a conventional leachfield, peat filter, or sand filter at each property.

The $470,000 total project cost reflected an estimated savings of $200,000 for the alternative of a centralized conventional gravity collection system with lagoon treatment. SIRWA operates and maintains the system as the borrower and system owner.

This significant savings for a small rural community was made possible through the assistance of Rural Development and the creativity of the community in considering a different approach to a common problem.

Competitive grants

In addition to the loans, grants and loan guarantees available under the construction program, RUS administers a competitive grant program that awards Technical Assistance and Training grants to eligible entities.

Since the 1990s, RUS has funded the National Drinking Water Clearinghouse of the National Environmental Services Center at West Virginia University, enabling the center to provide technical assistance to a broad spectrum of customers. Some of these funds offset the cost of State Onsite Regulators Alliance annual conferences.

There are opportunities through Rural Development for funds to be used for onsite and decentralized wastewater systems, including associated technical assistance and training. While the programs are not specifically intended for this purpose, for some projects like Shannon City, the decentralized option will be the most economical, and the funds can be appropriately used for the decentralized alternative.

As long as program requirements like centralized management can be met, Rural Development funding is a real possibility to help communities interested in onsite wastewater systems. More information about Rural Development programs is available from USDA state offices. Visit www.rurdev.usda.gov/StateOfficeAddresses.html. O