Elizabeth Tokash Duran, Clean Water State Revolving Fund program manager at the Department of Environmental Quality, and Diane Ament, director of the Public Finance Authority, briefed the committee on SRF operations, loan forgiveness and the interagency application portal used to coordinate funding.

Duran said the Clean Water SRF and the Drinking Water SRF operate as revolving loan funds, using federal capitalization grants, state bonding as match and loan repayments from borrowers to sustain lending. She said the program has provided more than $1 billion in project assistance since the program began in 1989. Loan terms are typically up to 30 years and the effective interest rate for SRF loans is currently about 2 percent.

Duran described loan forgiveness (treated operationally like grants) as constrained by available federal capitalization grants. She said loan forgiveness can be applied at levels of up to 75 percent for eligible recipients, and the DEQ limits total combined grants and loan forgiveness to 90 percent of a project where multiple grant sources are present. She also explained that the SRF programs prioritize projects through a published project priority list and that eligible projects include wastewater, stormwater, landfills and some water‑efficiency improvements (for example, meters). She emphasized that wastewater grant funding is limited and that the SRF loan program is the primary source for eligible wastewater projects that have demonstrated ability to repay.

Diane Ament of the Public Finance Authority explained the authority’s role: the PFA issues bonds to leverage federal capitalization grants so the programs can fund a greater volume of projects than grant dollars alone would allow. She said PFA issued $150 million in bonds in 2024 to finance the Clean Water SRF loan program and argued the approach has allowed the state to deliver significantly more assistance without a direct state appropriation to the SRF. Duran and Ament emphasized coordination: the FIND application portal shares project applications among DEQ, DWR, BND and PFA so agencies can assemble the best combined funding package for an applicant and avoid duplication of offers.

Duran provided examples of recent loan forgiveness and co‑funding: in 2023–24 the Clean Water SRF provided loan forgiveness totals and other grants to a small number of projects (sample years cited), but she cautioned that those amounts are limited and cannot be assumed available for all applicants. Committee members asked about lead service line replacement and program prioritization; Duran said lead‑line work is handled under the Drinking Water SRF, which has seen substantial federal investments in recent years.