Governor's Clean Water Initiative

What is the Clean Water Initiative?

FAQ for Media

Q: What is the Clean Water Initiative?

A:The Clean Water Initiative was announced in Governor Quinn’s 2012 Budget Address and launched the program in October 2012. This state program makes $1 billion in low-cost loans available to local governments investing in waste water and drinking water capital projects. Local governments can use these funds for a variety of programs, including replacing aging water mains, upgrading water towers, or bringing waste water treatment facilities in line with new federal standards.

Q: How can communities benefit from the Clean Water Initiative?

A:Many communities across Illinois have outdated water systems (in some areas, water mains are still made out of wood). Updating these systems will improve safety and comply with current federal standards. But undertaking large infrastructure improvements is often daunting, especially following the economic downturn. The Clean Water Initiative frees up additional dollars at low borrowing rates and also removes some restrictions on earlier lending programs to make it easier for local governments to improve a community’s water system, ensuring safe drinking water and improving waste water management.

In addition to ensuring safe drinking water and waste water management, the Clean Water Initiative will also create jobs across the state. According to the U.S. Conference of Mayors and Associated General Contractors of America, a $1 billion investment in public water infrastructure can support the creation of up to 28,500 jobs, including 9,700 direct construction jobs, 4,600 indirect supplier jobs and 14,200 induced jobs, for pipefitters, plumbers, engineers, carpenters, electricians and other professional trades.

Q: How does the Clean Water Initiative improve upon the State Revolving Fund?

A:The SRF offered only $300 million each year and had stringent deadlines for applications. With these limited funds, some projects couldn’t be funded. The Clean Water Initiative both expands the pool of funds available ($1 billion) and now allows the IEPA to process applications on a year-round, rolling basis.

Q: How can communities apply for these low-cost loans?

A: Units of local governments, including sanitary districts, can contact the Illinois Environmental Protection Agency (IEPA), including Geoff Andres, Manager of the Infrastructure Financial Assistance Section (217) 782-2027, Al Keller, Manager of Water Pollution Control Permits (217) 782-0610, and David Cook, Manager of Public Water Supply Permits (217) 782-0078.

Q: How is this funded? How can Illinois afford to offer these loans?

A: The Clean Water Initiative has no impact on the State’s General Fund or the State’s General Obligation bond rating. It’s an update to the State Revolving Fund (SRF), funded in Illinois and other states with annual federal grants, a one-time infusion in American Recovery and Reinvestment Act of 2009 funds, a previously-committed state match, plus the principal and interest from loan repayments.

Since 1989, IEPA’s well-managed SRF program has provided more than $4.3 billion in below-market interest rate loans to 472 Illinois communities, without a single defaulted loan. This excellent track record has earned a AAA bond rating, a large amount of repaid interest to increase the pool of available funds, and the equity of the $2.2 billion in loans that will be repaid over the next 20 years.

All of this allows the IEPA, working alongside the Illinois Finance Authority (IFA) and the Department of Commerce and Economic Opportunity (DCEO), to expand this low-interest loan program without adding additional state funds.

Further, the revenues generated from loan repayments can be used to meet the original state match requirement, which will free up those Illinois tax dollars for other vital programs.