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New SRF Affordability Criteria Development

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Environment, Great Lakes, and Energy

New SRF Affordability Criteria Development

A virtual public hearing has been scheduled on August 11, 2025 at 1:00 pm

On August 11, 2025, EGLE will hold a virtual public hearing at 1:00 p.m. on the draft Overburdened Criteria for SRF programs. Attendance at the public hearing is not required and comments given at the hearing will not be given more weight than comments submitted via email. The public comment period opened May 15, 2025 and closes August 29, 2025. Direct your questions to Mark Conradi

Sign-Up to Attend the Public Hearing

Draft: SRF Affordability Criteria Definitions

The draft criteria for overburdened municipal systems have two changes from the current criteria, which are highlighted below. The draft criteria for significantly overburdened municipal systems contain no changes. 

Overburdened Municipal Systems:

An Overburdened municipal system is a municipal system in which all the following conditions are met:

  1. Users served by a proposed drinking water project, sewage treatment works project, or storm water treatment project are directly assessed for the costs of construction.
  2. The median household income of the area directly assessed the costs of the proposed drinking water, sewage treatment works project or storm water treatment project is below 80% of the statewide median annual household income for this state. 
  3. The municipality demonstrates at least one of the following:
  • The taxable value per capita of the area directly assessed the costs of the proposed project falls into the communities representing the lowest 20% of Michigan’s population within that category. 
  • The annual user costs for the corresponding portion of the water system (sewage and storm water treatment or drinking water) exceed 1.5% of the median annual household income of the area directly assessed the costs of the proposed project.

Significantly Overburdened Municipal Systems:

A Significantly overburdened municipal system is a municipal system in which all the following conditions are met:

  1. Users served by a proposed drinking water project, sewage treatment works project, or storm water treatment project are directly assessed for the costs of construction.
  2. The municipal system demonstrates at least one of the following:
  • The median annual household income of the area directly assessed the costs of the proposed project is less than 125% of the federal poverty guidelines for a family of four in the 48 contiguous United States.
  • The taxable value per capita of the area directly assessed the costs of the proposed project falls into the communities representing the lowest 10% of Michigan’s population within that category. 

 

A municipal system which qualifies as a significantly overburdened municipal system would also be considered an overburdened municipal system. However, any potential benefits may only be applied under one designation or the other.

Why are criteria updates being considered?

Public Act 132 of 2022 that revised Public Act 451 of 1994 allows for overburdened and significantly overburdened scoring criteria to be updated no more frequently than every three years. The current criteria have been in place for the FY24, FY25, and FY26 loan cycles and EGLE is reviewing and potentially updating the criteria for State Revolving Fund projects in FY27 and beyond.

View the current affordability criteria

Timeline for SRF overburdened criteria updates:

  • January – Statistics from FY24 and FY25 will be posted to provide an overview of program outcomes.
  • May - EGLE will be scheduling two virtual public meetings in May where additional details on prior statistics and/or data on how criteria changes would have affected prior scoring will be shared. Both meetings will have the same content and those interested will be asked to attend the one that fits their schedule best. After these meetings EGLE will begin to start accepting public comments on the SRF overburdened criteria.
  • July – A draft release of criteria will be posted to this site and EGLE will continue to accept public comments.
  • August – A public hearing will be held regarding the draft criteria followed by an additional month-long period to continue receiving public comments.
  • September - Updated overburdened criteria will be posted for Fiscal Years 2027, 2028, and 2029 so applicants will have time to see and review them prior to submitting an ITA for Fiscal Year 2027.

Virtual Information Meeting Recordings

Two identical presentations and listening sessions were held virtually on different days and times to allow for more participation. Recordings of each of the meetings have been made available for reference. 

Overview Statistics from Fiscal Year (FY) 2024 and 2025

The following statistics were compiled from projects on the FY24 and FY25 Intended Use Plans. It is not intended to be an exhaustive list or imply if and what changes EGLE may propose for the overburdened qualification criteria for FY27, FY28, and FY29.

Summary of FY 24-25

  • Number of projects that applied for overburdened status: 612
  • Number of projects that qualified for overburdened status: 431
  • Number of projects that qualified without calculation either by being in the lowest 20% of Michigan’s population in taxable value per capita (TVPC) or by having a median annual household income (MAHI) below 125% of the federal poverty level for a family of 4: 149
  • Number of projects that qualified as overburdened or significantly overburdened and did not receive funding (fell outside of the fundable range): 251
  • Number of regional systems that qualified as overburdened: 137
  • Number of non-regional systems that qualified as overburdened: 294

Average MAHI and TVPC

  • FY24 average MAHI of applicant qualifying as overburdened: $44,378.86
  • FY24 average TVPC of applicant qualifying as overburdened: $28,994.36
  • FY25 average MAHI of applicant qualifying as overburdened: $51,784.27
  • FY25 average TVPC of applicant qualifying as overburdened: $31,914.30

Average Resident Equivalent User Cost

  • FY24 average applicant cost per REU: $973.92
  • FY25 average applicant cost per REU: $1271.42
  • FY24 and FY25 - Regional systems average cost per REU: $923.29
  • FY24 and FY25 - non-regional systems average cost per REU: $1233.80
Fiscal year 2024-25 State Revolving Fund Funded or Planned Project Locations in Relation to CJEST Determination Areas

FY24 and FY25 projects mapped and compared to the Climate and Economic Justice Screening tool

EGLE mapped FY24 and FY25 projects in the fundable range and compared them to the most recent version of The Council on Environmental Quality’s (CEQ) Climate and Economic Justice Screening Tool (CEJST) which was used to determine progress towards the Environmental Justice 40 policy.

CEJST used indicators of burdens in eight categories: climate change, energy, health, housing, legacy pollution, transportation, water and wastewater, and workforce development and from that determines if a community is classified as disadvantaged, partially disadvantaged, or not disadvantaged. When comparing the methods in how CEJST and EGLE SRF classify communities, CEJST classified 60% of the projects in Michigan’s fundable range as disadvantaged. Using EGLE’s overburdened criteria, which use median household income, taxable value per capita, and cost of service per residential equivalent unit, 87% of projects in the fundable range qualified as overburdened. While EGLE uses fewer complex criteria to define an overburdened community, it resulted in more projects qualifying as overburdened.

Click to view the SRF and CEJST comparison map
Sankey diagram showing the flow of projects in FY24

Flow of Projects in FY24

  • Projects on the FY24 CWSRF and DWSRF Intended Use Plans: 271
  • Projects that qualified as overburdened: 136
  • Projects that qualified as significantly overburdened: 70
  • Projects that did not qualify as overburdened: 65
  • Projects funded in FY24: 105
  • Projects that were not funded in FY24 that reapplied in FY25: 123
  • Projects that qualified as overburdened: 60
  • Projects that qualified as significantly overburdened: 19
  • Projects that did not qualify as overburdened: 44
  • Projects of the 123 that reapplied in FY25 that were still not able to be funded: 105
Click to expand the flow of projects diagram