SRF Earmarks Reduce Set-Aside Funds For All States (FY2023-FY2026)

waterresources
Written By Ekta Patel

Each state can set aside a portion of their SRF capitalization grant to help run their programs. These set-aside allowances fund staff, technical assistance, SRF program management, and various activities including operator certification and other water system capacity building programs. Set-asides are calculated as a percentage of each state’s allotment (capped at 6% for clean water SRFs and 31% for drinking water SRFs).

Since FY2022, Congress has funded water earmarks from SRF appropriations before EPA calculates state allotments. This, in turn, reduces the amount of set-asides available to states. As such, every state loses set-aside capacity whether or not it receives any water project earmarks. Across FY2023, FY2024, and FY2026, that reduction is approximately $741.2 million nationwide, an average of $247.1 million per year.

This brief quantifies the set-aside loss by state, and provides recommendations for state programs and Congress.

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For more information, please see: policyinnovation.org/state-revolving-fund-earmarks

Ekta Patel

Ekta joined EPIC in 2025 as a Senior Policy Analyst in the Water Program. Previously, she served as a Water and Policy Advisor at USAID, where she developed strategies to advance water security and provided technical assistance to water, sanitation, and hygiene projects, with a focus on fragile and conflict-affected settings. Her experience spans water management in the western US, desalination, infrastructure financing, and US and international water governance. Earlier in her career, Ekta was a business analyst and product designer at an education technology start-up. She holds a PhD in Environmental Policy from Duke University and a BA with honors in Environmental Science and Public Policy from Harvard University.

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