The Economically Distressed Areas Program (EDAP), administered by the Texas Water Development Board (TWDB), provides financial assistance for water and wastewater projects in economically distressed residential areas. These areas lack basic water or sewer services, or their existing systems fail to meet state standards. EDAP funding helps support planning, land acquisition, design, and construction efforts for first-time water and wastewater services or improvements to non-compliant systems. Only residential projects are eligible for assistance under this program.

Eligible applicants for EDAP funding include cities, counties, water districts, nonprofit water supply corporations, and other political subdivisions. One key requirement is that the project must be located in an area where the median household income is no more than 75% of the state median income. Additionally, the residential subdivision in question must have been established on or before June 1, 2005. The city or county must adopt and enforce Model Subdivision Rules to regulate subdivisions before applying for financial assistance.

EDAP provides a combination of grants and loans, with 70% of the funding given as a grant and 30% as a loan. Loans under the program are limited to a maximum 20-year term. If a project seeks more than 50% grant funding, a public health nuisance determination from the Texas Department of State Health Services is required. The prioritization of funding is based on legislative criteria, giving preference to projects that address public health and safety concerns or are subject to enforcement actions.

The program’s funding is primarily derived from constitutional bonding authority. In 2019, Texas voters approved a proposition authorizing the issuance of up to $200 million in general obligation bonds for EDAP projects. However, actual funding availability is determined through biennial legislative appropriations. For the current biennium, approximately $100 million has been allocated.

Applicants must comply with several program requirements, including demonstrating inadequate financial resources to provide water and sewer services, maintaining authorization from the Texas Commission on Environmental Quality (TCEQ) for waste disposal regulation, and securing any necessary permits. Additional obligations may include adopting water conservation and drought contingency plans, ensuring compliance with U.S. Iron and Steel Manufactured Goods requirements, and meeting legislative water loss threshold limits.

For more information, applicants can contact their designated TWDB Regional Project Implementation Team. Several resources are available, including the EDAP Intended Use Plan, application materials, model subdivision rules training, and previous funding reports. Workshops and other informational sessions are also available to help applicants navigate the funding process and meet eligibility requirements.