USDA Rural Development — Water & Waste Disposal Loan and Grant Program

Long-term, low-interest loans (up to 40 years) and combinable grants for drinking water, wastewater, and stormwater infrastructure in rural communities of 10,000 people or fewer.

USDA Rural Development's Water and Environmental Programs are the only federal financing source dedicated exclusively to water infrastructure in small rural communities. Loans run up to 40-year terms at favorable rates — often well below commercial lending and below even SRF rates for the most distressed communities. Grants can be combined with loans to lower the per-household cost burden, especially for low-income service areas.Eligible projects include new drinking water and wastewater system construction, treatment plant upgrades, lead service line replacement, source water protection, stormwater drainage, and decentralized septic systems. Eligible applicants include municipalities, public water and sewer authorities, federally recognized tribes, and certain nonprofits operating qualified systems.The associated Predevelopment Planning Grant program provides up to $30,000 to help low-income communities prepare a fundable application — critical for the smallest systems. The Rural Decentralized Water Systems Grant Program runs through partner nonprofits to make small loans and grants directly to individual homeowners for failing on-site systems. Applications are accepted year-round on a rolling basis through the RD Apply portal.