Defining Affordability: Targeting Federal Funds to Improve Water Quality to “Disadvantaged Communities” in North Carolina

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Source: EFC at UNC

Under the Drinking Water State Revolving Fund (DWSRF) Program, states receive capitalization grants to improve their drinking water facilities. States may provide longer term loans and principal forgiveness (not to exceed 30% of their annual DWSRF grant) to “disadvantaged communities.” This research explores how North Carolina should define a “disadvantaged community” as it relates to the DWSRF. It includes an exploration of the criteria used by the thirty other states that have already established disadvantaged communities programs. The paper aligns existing practices from other states with the unique needs of North Carolina to suggest specific affordability criteria that this state should employ in determining which populations are eligible to receive this type of financial assistance. With water rates currently rising faster than overall inflation, these funds may be crucial in supplying safe drinking water to smaller, poorer communities across North Carolina.

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