Clean Water and Drinking Water Revolving Funds: Which Public Dollars Paid for the Work?

A false expenditure certification can draw payment from clean water and drinking water revolving funds that combine federal capitalization, state money and repayments from earlier loans. If you work with project invoices, expenditure certifications or laboratory results, the financing agreement connects what you see to the public money behind the work. This page follows that financing and payment chain, from the fund to the expense someone certified.

How Does a Water Revolving Fund Payment Reach a Project?

The Environmental Protection Agency supplies capitalization grants to state revolving funds, and states contribute matching money. States then finance projects through their own agreements. As the Environmental Protection Agency explains in its description of the drinking-water fund, the state stands between the federal capitalization and the water system receiving assistance.

The fund keeps working after its first loans. Principal repayments, loan interest, investment earnings and proceeds from bonds can support later assistance. That is the revolving part: repaid money becomes available for another project.

For someone inside a water utility or a state financing agency, the executed financing agreement identifies the financing relationship. The draw request and supporting invoices show what the recipient asked the fund to cover. The disbursement record shows the release of money.

A federal cash draw records movement from the federal grant, while a project disbursement records money going to a project. The Environmental Protection Agency’s financial reporting tracks executed assistance, project disbursements and federal grant cash draws separately. We follow those stages to identify whose money supported the disputed cost.

How Do Clean Water and Drinking Water State Revolving Funds Differ?

The Clean Water State Revolving Fund finances projects such as sewer improvements and landfill-leachate treatment. The Drinking Water State Revolving Fund supports drinking-water projects, including work involving lead service lines and emerging contaminants. Both use state financing structures, but the particular project and its agreement identify which program supplied assistance.

The distinction matters even when the same community receives support for both. The Environmental Protection Agency describes separate sewer and drinking-water assistance in its Lewes example. Someone examining a sewer invoice needs the sewer financing record, with the drinking-water support kept in its own account of the project.

California’s Program Contains Several Public Sources

California’s 2026-27 Clean Water State Revolving Fund Intended Use Plan brings federal capitalization and state funding together. It includes federal base, supplemental and emerging-contaminant capitalization alongside Proposition 1, Proposition 68, Proposition 4 and state appropriations.

An intended-use plan describes planned financing. An executed agreement records the financing actually arranged for the recipient, and payment records show the money released under it. For an insider concerned about a false invoice, the useful detail is the source assigned to that invoice, including any state-only funding, rather than the largest federal figure associated with the program.

Which Records Connect an Invoice to the Fund?

The executed agreement, approved budget, draw request, invoice and expenditure certification connect the expense to the financing. California’s September 2024 disbursement instructions make that relationship concrete. An executed agreement or amendment and the relevant budget approval precede processing of a request.

Form 260 requests the disbursement. Form 261 carries the invoice details and the authorized representative’s expenditure certification. A person working in accounts payable may know what the invoice bought, while the representative signing the certification makes the statement supporting the request. We examine the expense and that statement together.

The instructions also connect the request to payment timing. Costs must already have been paid or must be paid within 30 days after the recipient receives the money, with unused funds returned. The recipient’s payment ledger supplies the next part of the story: what happened to the funds after disbursement.

California also says recipient wages and expenses cannot include a profit markup. That makes the underlying payroll or expense amount consequential when the recipient charges its own costs. Someone who knows how those costs were assembled may be able to explain a difference that the signed certification leaves out.

These records give us specific questions to work through with you. Which version of the budget supported the request? What did the authorized representative certify, and what expense did the invoice actually describe? The agreement and its amendments supply the approved terms against which those statements can be read.

What Does Principal Forgiveness Mean for a Water Project?

Principal forgiveness is the portion of assistance the recipient does not have to repay. For a project accountant, it describes the repayment responsibility, while the invoice and disbursement records show which expense the fund covered.

The Environmental Protection Agency’s 2024 Clean Water State Revolving Fund Annual Report illustrates the distinction through Marquette County Solid Waste Management Authority’s landfill-leachate project. The authority received a $7,000,000 loan that included $4,435,908 in principal forgiveness.

The report also describes the Lewes Board of Public Works’ manufactured-home-park sewer project. Its $2,742,146 loan carried 100% principal forgiveness. Here, the loan label and the repayment burden tell different stories: the stated principal was entirely forgiven.

When Does a Water-Project Certification Support a False Claim?

A knowingly false certification can support a false claim when it influences payment for the project. The financing agreement identifies the funded work and conditions, while the invoice, certification and payment show how the representation reached the payer. What did someone say the public money was paying for, and what did they know about the actual expense?

A false bill can reach federal money through a state fund or another grant recipient, even when no federal agency pays the bill directly. We examine the identified funding source and the representation used to obtain that money. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

New York Certified Executive-Chamber Salaries as Water-Program Costs

New York State Environmental Facilities Corporation admitted using indirect-cost certifications to charge the federal Clean Water State Revolving Fund for salaries and benefits associated with positions in the Governor’s Executive Chamber. In its settlement agreement with the United States, the corporation acknowledged that those positions did not have the represented relationship to the program. The certifications supplied the asserted connection between the payroll and the water money.

The agreement identified $281,227 in excess indirect costs and required a $500,000 settlement. The admitted facts concerned eight certifications during fiscal years 2009 through 2019. We see what the certification accomplished: it gave the Executive Chamber a water-program job.

For someone preparing cost allocations or reviewing grant expenses, the relevant comparison is between the work the employees performed and the relationship certified to the program. That is where knowledge of the actual job can matter as much as knowledge of the accounting.

Stantec and Cardno: Bidding on Solicitations They Helped Write

The Justice Department alleged that Stantec Consulting Services Inc. and Cardno Consulting LLC helped draft solicitations and then competed for and performed the resulting work under 75 EPA Brownfields assessment grants. Applications represented compliance with the competition requirement, and the settlement agreement says EPA relied on those representations. The department announced a $4 million settlement in July 2025 to resolve the allegations.

The alleged procurement conflict put competing firms up against specifications their rivals had helped write. Stantec and Cardno’s case concerns statements about how the work was awarded, while New York’s admissions concern salaries charged to the water program. In each, the statement supporting public money needs to be read against what happened inside the organization.

Where Does a Water Test Fit Into the Payment Chain?

A water test fits into the payment inquiry through the environmental information or certification required for the funded work. The Environmental Protection Agency’s quality-assurance requirements for financial assistance address the collection, production and use of environmental information. The approved quality assurance project plan supplies the starting point for examining that work.

We follow the technical record from sampling and chain of custody through instrument output, calibration, quality controls, validation and the final report. The financing and billing records connect that technical work to the representation used for payment. A laboratory supplies environmental information, while an authorized recipient representative certifies expenditures. Those responsibilities can belong to different organizations.

If you know that a final report differs from the underlying test work, your knowledge can identify the precise statement worth examining. We connect that difference to the approved testing requirements, the invoice and the funding agreement. If your concern instead begins with an expense certification, the underlying payroll, invoice or payment ledger supplies the comparison. The starting document changes with the work you know.

When You Know What the Water Money Paid For

If the expense certified to a water fund differs from the work you know, speak with our whistleblower experts about that payment. We build your strongest water-funding whistleblower case around what you know and what the financing records show, and bring in water-funding whistleblower lawyers with the experience your case needs. We stay beside you from the first conversation through the case.