Drinking Water Source Protection Fund

The Drinking Water Source Protection Fund is administered by the Oregon Health Authority Drinking Water Services in coordination with the Oregon Department of Environmental Quality. The program originates from federal Safe Drinking Water Act resources and is designed to help public water systems proactively protect their drinking water sources from contamination. The fund supports both planning and implementation activities that reduce risks within delineated source water areas, including aquifers, springs, and surface water watersheds that supply public drinking water systems. The program reflects a long-standing state and federal partnership to improve water quality and reduce the long-term costs associated with contamination treatment or replacement of water sources. The primary purpose of this funding opportunity is to reduce contamination risks through targeted source water protection activities. The program supports projects that enhance delineation of source areas, conduct risk assessments, develop protection plans, and implement strategies that prevent or mitigate pollution. Eligible uses of funds include inventorying contaminant sources, evaluating threats to water quality, developing protection ordinances, implementing pollution prevention measures, and conducting public education efforts. Conservation planning activities are also eligible, particularly those that assess the feasibility of land acquisition or easements to protect water sources. However, funds cannot be used for routine system operations, infrastructure upgrades, or treatment facility construction, as the focus remains on prevention rather than remediation. Funding is available through both grants and low-interest loans. Grants are offered up to seventy thousand dollars per eligible water system, while loans may reach up to one hundred thousand dollars for qualifying projects. Additional funding tracks include land acquisition planning grants and a pilot regional collaborative grant program, which provides up to one hundred seventy five thousand dollars per project to encourage coordination among multiple water systems. All awarded funds must be expended within two years of contract execution, and disbursement occurs on a reimbursement basis after a funding agreement is finalized. There is no stated matching requirement for applicants, making the program accessible to smaller or resource-limited systems. Eligibility is limited to publicly and privately owned community water systems and nonprofit non-community water systems that have completed a source water assessment. Systems must meet regulatory definitions, including serving a minimum number of connections or individuals. Federally owned systems and for-profit non-community systems are not eligible. Additional restrictions apply to systems with recent funding awards or multiple open projects, although exceptions exist for regional collaborative applications. Applicants must also comply with federal requirements, including restrictions on certain telecommunications equipment and adherence to procurement standards. The application process requires submission of a completed Drinking Water Source Protection application form that clearly outlines the proposed project, its objectives, and expected outcomes. Applications must be approved by the governing body of the water system and signed by an authorized official. Projects are evaluated based on criteria including the sensitivity of the source area, presence of contamination risks, existing contaminant detections, proposed risk reduction activities, and the likelihood of achieving measurable improvements. Additional consideration is given to disadvantaged communities. After submission, applications are reviewed, scored, and ranked to determine funding priority, and selected projects proceed to contracting with Business Oregon. The application timeline for the 2026 funding cycle opens in late January and closes in mid March. Following submission, projects are reviewed and ranked through the spring, with funding announcements and contracting occurring later in the year. Projects typically begin implementation after contracts are executed and must be completed within a two year period, with limited extensions available under specific circumstances. While the program operates on an annual cycle, emergency expedited funding may be available outside the standard timeline for urgent contamination threats. Applicants are encouraged to engage with program staff early to refine project ideas and ensure eligibility.

Focus on projects that demonstrate clear risk reduction potential and address high risk contamination sources; align proposal with scoring criteria such as sensitivity of source area and measurable outcomes; engage early with OHA or DEQ staff for guidance