This agreement provides a capitalization grant for the recipient's drinking water state revolving fund (DWSRF) program

The Environmental Protection Agency (EPA) Region 2 awarded the Puerto Rico Department of Health a $5.59 million Formula Grant under the Drinking Water State Revolving Fund (DWSRF) program (CFDA 66.468), effective October 1, 2025, through September 30, 2032. This capitalization grant enables the Puerto Rico Infrastructure and Financing Authority (PRIFA), serving as subrecipient, to establish and maintain a low-cost, long-term financing mechanism for drinking water infrastructure improvements across Puerto Rico. The primary deliverables include providing below-market-rate financing to eligible public water systems for the planning, design, and construction of drinking water improvement projects. Additionally, funds support set-aside activities such as technical assistance to small water systems, operator certification programs, and source water protection initiatives.

PRIFA manages fund administration by depositing capitalization grant amounts into DWSRF accounts, maintaining comprehensive accounting and financial records, conducting annual independent audits, and coordinating cash draws with EPA for corresponding disbursements. The anticipated outcomes are improved public health protection through increased technical, managerial, and financial capacity of public water systems, with benefits extending to citizens throughout Puerto Rico. The majority of funding will support drinking water construction projects that address critical water quality and infrastructure needs in the territory.

The award furthers the public health protection objectives of the safe drinking water act (SDWA). Activities:the recipient of these funds will provide low interest rate financing to eligible public water systems for the costs associated with the planning, design, and construction of eligible drinking water improvement projects. The recipient may also use some of the funding for specific set-asides, including but not limited to providing technical assistance to small systems, for operator certification activities, and source water protection activities. Subrecipient:the PR infrastructure and financing authority receives capitalization grant donations and deposits them into the DWSRF accounts, maintains the accounting system for the operation of the program; maintains fiscal and financial records, and provides prdoh (as required) with reports summarizing all transactions with the DWSRF. Prifa also have an annual independent audit performed and makes the cash draws from EPA for the corresponding disbursement in accordance with the terms and conditions of the capitalization grant agreement, among other things. Most of the funds on this category will be used on drinking water construction projects in PR.outcomes:the anticipated deliverables include financing, planning, design, and construction of eligible public health-related projects. Deliverables will also be used to increase the technical, managerial, and financial capacity of public water systems. The expected outcome is public health protection. The intended beneficiaries include citizens throughout the state.