Rural Water Assistance Fund Program 

The Rural Water Assistance Fund (RWAF) is a financing initiative administered by the Texas Water Development Board (TWDB) to support small rural utilities in Texas with low-cost funding for water and wastewater projects. The RWAF was enhanced following the enactment of Senate Bill 28 and Senate Joint Resolution 75 by the 88th Texas Legislature in 2023, which led to the creation of the Texas Water Fund. Voter approval of Proposition 6 in November 2023 and a one-time $1 billion general revenue allocation under Senate Bill 30 further bolstered the fund. The RWAF aims to empower small rural utilities, specifically those categorized as “rural political subdivisions,” with financial assistance for water-related infrastructure. These subdivisions include nonprofit water supply corporations, municipalities serving populations of 10,000 or fewer, districts, and counties where no urban area exceeds 50,000 residents. Eligible entities may also collaborate with federal or state agencies or other rural political subdivisions to seek funding. Funding can be applied to a variety of water and wastewater projects, including but not limited to planning, design, and construction of wells, water lines, desalination facilities, treatment plants, reservoirs, and acquisition of water rights. It also includes wastewater collection and treatment facilities, pollution abatement initiatives, and regional utility consolidations. The RWAF supports projects included in the State or Regional Water Plans and facilitates access to service from larger utilities when appropriate. Applicants may apply for funding across different project phases. Pre-design funding includes initial planning, environmental reviews, and feasibility assessments. Once approved, funds for final design and construction are held in escrow. For applicants pursuing construction-only funding, all plans, permits, and bids must be secured and approved before the loan closing. To qualify for RWAF assistance, entities must meet criteria specified under Texas Water Code § 15.001(14). A series of prerequisites such as water conservation plans, prior water use survey responses, and reviews of water loss thresholds are required. Projects over $500,000 necessitate the adoption of a drought contingency plan. Entities ineligible for tax-exempt funding may qualify through taxable or AMT bonds if they meet applicable U.S. tax requirements. Projects must also comply with U.S. Iron and Steel requirements. As of now, the RWAF program is not accepting applications. For future participation and inquiries, applicants are encouraged to reach out to their designated TWDB Regional Project Implementation Team. The Texas Water Development Board office is located at 1700 North Congress Avenue, Austin, TX 78701, and can be reached by phone at 512-463-7847 or by fax at 512-475-2053.

Entities should ensure eligibility under TWC § 15.001(14), maintain compliance with water use surveys, and prepare conservation/drought contingency plans if seeking assistance over $500,000.