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Appendix C: Table of Contents

Section C-3: State Revolving Fund (SRF) Loan Program

The Indiana Revolving Fund (SRF) Loan Program provides low-interest loans to Indiana communities for projects that improve wastewater and drinking water infrastructures. The Indiana Finance Authority administers this program that protects both public health and the environment. Recently, SRF has implemented a program to fund NPS projects, as well. The Indiana SRF Loan Programs have provided over $1.3 billion dollars in low-interest loans to Indiana communities for projects that improve wastewater and drinking water infrastructure. More than 200 communities have closed on over 200 wastewater loans and 75 drinking water loans. Great strides have been made by communities with this money in addressing water quality problems from point sources; however, SRF recognizes that NPS run-off and watershed disturbances threaten these successes and impede future water quality improvements. In response to this situation, SRF has expanded its financing opportunities to projects that abate or prevent NPS pollution of Indiana’s waters. Integrating a NPS project with a wastewater or drinking water project may reduce a community’s SRF program loan interest rate by up to as much as 0.5 percent, or half of the cost of the NPS project.

Who Is Eligible?

  • Cities, towns, counties, regional sewer/water districts, conservancy districts, and water authorities are eligible for wastewater, drinking water, and NPS SRF loans; and,
  • Private and not-for-profit facilities are eligible only for drinking water SRF loans.

Where does the money come from?

  • The state applies to the U.S. EPA annually for capitalization grants to fund its SRF programs. To increase available funds, the state leverages its U.S. EPA capitalization grants in the municipal bond market. These funds are combined with the U.S. EPA required state match and are then made available to Indiana communities in the form of low-interest rate loans.

What types of projects are eligible for funding?

  • Any project where there is an existing pollution abatement and need is eligible for SRF funding;
  • Wastewater projects include:
    • treatment plant improvements and upgrades;sewer line extensions to existing unsewered properties;
    • combined sewer overflow corrections; and,
    • infiltration/inflow projects.
  • Drinking water projects include:
    • treatment plant improvements and upgrades;
    • water line extensions to existing unserved properties; and,
    • water storage facilities.
  • NPS projects include:
    • wetland protection and restoration measures;
    • on-site sewage disposal systems;
    • BMPs for agriculture and storm water run-off;
    • riparian buffers and conservation easements; and,
    • wellhead and source water protection measures.

What types of projects are not eligible for funding?

  • Projects that are solely intended for economic development;
  • Projects that are primarily for fire suppression; and,
  • Storm water projects that have no water quality benefits.

How does a community apply for a SRF loan?

What are the loan terms?

  • The SRF loan is a fixed rate, 20 year loan; and,
  • Interest rates reset quarterly and are at or below 90% of the average 20 year, AAA rated, general obligation bond Municipal Market Data. Rates are further discounted based on the applicant’s median household income (from current census data) and local user rates.

Where can I get more information about SRF loans?

  • For more information about SRF program administration and the SRF process, please contact the Indiana SRF Program Office at (317) 232-8655 or visit the SRF Web site.

Table of Contents