Millions of Dollars Available for New Mexico Water System Improvement Projects

Does your water system need improvement? Does it need repairs, expansion, regionalization, storage, treatment to remove contaminants, new pipes, or replacement of lead service lines? Or does your community need a new water source to replace a contaminated well?

The New Mexico Environment Department (NMED) has access to millions of dollars in loans to help with these and other types of water system projects. These loans are available to community water systems as well as non-profit, non-community water systems (for example, at a school or a camp). The loans come from the Drinking Water State Revolving Fund. That is a federal-state program that provides low-cost financial assistance to water systems for a wide range of drinking water projects.

These loans offer excellent terms:

  • Communities with a low median household income can qualify for 0% interest, and up to 75% of the loan principal may be forgiven.
  • For regionalization projects, up to 90% of the loan principal may be forgiven.
  • For green projects – like water conservation, increased efficiency, and green infrastructure – even more of the loan principal may be forgiven.
  • Loans for removing “emerging contaminants” from water systems – including PFAS and manganese – may be 100% forgiven. The six lists of emerging contaminants are here:

Getting started is easy. Your water system administrator just needs to:

1) Submit a simple pre-application, using this form:

This is the checklist of necessary information for the form:

2)Provide some additional documents when NMED’s Drinking Water Bureau staff request them.

3)Complete a full loan application for the New Mexico Finance Authority after the pre-application is placed on the Fundable Priority List.

Help is available!

  • If your water system administrator isn’t sure exactly what is wrong with your water system, staff from the New Mexico Rural Water Association may be able to come out and troubleshoot.
  • The Rural Community Assistance Corporation and the Southwest Environmental Finance Center may be able to help the administrator with the application process.
  • The Infrastructure Support Team at NMED’s Drinking Water Bureau is available to answer questions. Please contact them at:
  • And if the pre-application isn’t placed on the Fundable Priority List the first time around, NMED staff will provide recommendations on how to strengthen it before it is re-submitted.

For more information, visit:

You can find links to the pre-application and the checklist on that site, too. Thanks to the New Mexico Environment Department for this information and work to help New Mexico communities

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