Aquifers are underground reservoirs that hold groundwater. The reservoirs are comprised of permeable rock that can hold and transmit water to the surface via natural springs or by pumping — some communities draw their water supply from groundwater aquifers, either through centralized systems or via private wells.

In this context, avoided costs are the savings that result from adequately meeting water demands and not needing to treat and transmit additional water volume.

Asset management is the process by which utilities account for, track, and monitor the infrastructure that makes up water, wastewater, or stormwater systems. Facets of asset management involve prioritizing projects to make the best use of limited funds, identifying needed repairs and replacements, and anticipating infrastructure needs and improvements. Good asset management improves water affordability because utilities can act proactively and avoid costly infrastructure failures such as main breaks.

An outstanding balance; overdue charges on a water bill can lead to penalty fees, water shutoffs, and other compounding, debt-driven issue.

Rates are “appropriately set” when utilities are able to collect enough revenue to cover their operating costs, maintain water infrastructure systems and processes (i.e. water collection, treatment, transmission, and discharge), and protect and ensure consumer affordability.

Water infrastructure that is deteriorating due to a variety of factors, such as disinvestment, lack of maintenance, etc.

According to the Pacific Institute, water is affordable when its cost does not prohibit access to the resource, nor interfere with other essential expenditures (ex. food, shelter, electricity).

Advocacy refers to the various ways that stakeholders make their voices heard on issues that affect their lives and the lives of others in their communities, state, and country. It also involves helping policymakers find specific solutions to issues and problems

In the context of this toolkit, bonds are debt obligations that state or local governments issue to finance infrastructure projects, such as water main replacements. A bond can also be described as a written promise to repay funds over a given period of time.

In the context of this toolkit, block grants are monies that the federal government provides to state and local governments for a variety of community development purposes, ranging from infrastructure improvements to equipment purchases. So long as the funds are used to support community development and investment, there are few strings attached to block grant dollars.

A block rate is a water rate structure that is based on customer usage (measured in blocks, or tiers). An increasing block rate structure charges more per unit of water as usage increases, and a decreasing block rate charges less per unit of water as usage increases; increasing block rates are often used to encourage water conservation.

Black, Indigenous, and People of Color.

A bioswale is a vegetated channel that uses natural processes to carry, retain, and infiltrate stormwater. A green stormwater infrastructure technique, bioswales are generally designed to have engineered soil and native plants that improve stormwater infiltration and retention capacity.

A type of Customer Assistance Program (CAP), billing assistance programs are designed to help customers pay their bills based on their circumstances. This assistance can come in many forms: a subsidy or discount on the total bill amount, a billing payment plan, or an extended due date, for example.

Bill discounts are a type of Customer Assistance Program (CAP) whereby some portion of the total water bill amount has been reduced. Bill discounts are generally used to accommodate economic hardship, but customers may also receive discounts by enrolling in water conservation programs.

Utility costs can be divided into two categories: Capital costs are the expenses required to construct new water infrastructure, and operating costs are the monies that go toward its business functioning (salaries, for instance).

Capital improvement plans list all planned projects, equipment purchases, and major planning/engineering studies of a utility or municipality. These implementation plans provide a working blueprint for sustaining and improving the community infrastructure and typically include information about construction timeframes, and financing and funding needs.

Capitalization grants are awarded to states by the Environmental Protection Agency (EPA) to create and maintain Clean Water State Revolving Funds. These grants: (1) enable states to encourage construction of wastewater treatment facilities that meet the enforceable requirements of the Clean Water Act; (2) increase the emphasis on nonpoint source pollution control and protection of estuaries, and (3) establish permanent financing institutions in each state to provide continuing sources of financing for water quality maintenance.

Centralized infrastructure systems collect, treat, and distribute water and wastewater at a central location (i.e. a treatment plant). Such systems make up the majority of water and wastewater infrastructure networks

As the climate changes, water resources and infrastructure systems will be impacted in several ways. In the context of this toolkit, climate change refers to the extreme weather patterns that impact water cycles and water systems, including periods of increased rainfall or drought. Old infrastructure may not be sized to manage increasingly severe storm events, which can lead to overwhelmed sewer systems, flooding of homes, yards, and streets, and untreated sewage and stormwater seeping into rivers and lakes. Prolonged drought periods may lead to depleted groundwater tables, causing water access issues. Municipalities must make investments in aging water infrastructure to ensure its resilience: these investments will likely cause rate increases, which could create affordability issues.

The Environmental Protection Agency (EPA) delineates public water systems by community size: very small (500 or less); small (501-3,300); medium (3,301-10,000); large (10,001-100,000); and very large (100,001 or more). These categorizations help the EPA develop more responsive guidance, regulatory oversight, technical support, and funding and financing — while “very small” and “small” systems make up about 95 percent of all public water systems, they serve only 12 percent of all customers.

The fee a utility charges when a new customer is connected to a water system and begins receiving water service.

Conservation is a sustainability practice that focuses on reducing water use to preserve natural resources —  they are often implemented to achieve ecosystem health goals, but they also naturally improve water affordability (i.e. less water use means a lower water bill). Conservation practices are usually behavior-based; for example, taking a shorter shower, or not keeping a faucet running while brushing teeth.

A consumer bill of rights provides legal grounds for ratepayer complaints and provides guidance on rate-setting from a consumer protection angle. They often require the implementation of direct assistance programs for vulnerable populations and halt water shutoffs due to an inability to pay.

The Safe Drinking Water Act defines “contaminant” as any physical, chemical, biological, or radiological substance or matter in water. Contamination can result from industrial and agricultural pollutants, or household products that enter the water supply when dispose; some common pollutants include lead, copper, arsenic, and perfluorooctanoic acids (PFOAs). Though many Americans have access to clean and safe drinking water, drinking water may reasonably be expected to contain at least small amounts of some contaminants — proper asset management and proactive infrastructure investment can reduce widespread contamination and public health crises.

The requirements a low-income customer must meet in order to be considered for a customer assistance program (CAP).

Customer assistance programs (CAPs) are used as a supportive mechanism for households who cannot afford to pay as dictated by the standard rate structure. CAPs are designed to help customers manage past-due bills and pay current bills, and may include bill discounts, flexible payment terms, temporary hardship assistance, and water efficiency programs.

A classification of ratepayer types, e.g. residential single-family building, residential multifamily building, commercial, industrial, low-income, fixed-income, etc. These classes help utilities set responsive rates, and can help them both collect more revenue and improve affordability outcomes.

A community with an unemployment rate that is at least 1 percent greater than the national average unemployment rate (based on the most recent 24-month period for which data is available).

According to the Clean Water Act, discharge is the result of any pollutant being added to navigable waters (e.g. rivers and lakes) from any point source (i.e. wastewater treatment plant or factory); examples of pollutants include “solid waste, sewage, garbage, sewage sludge, chemical wastes, industrial, municipal, and agricultural waste.” Unless authorized by permit, Congress prohibits discharge.

While the exact definition is usually left to funder discretion, disadvantaged communities normally refers to communities with poor socioeconomic outcomes or existing environmental vulnerabilities (e.g. air and water pollution contamination, extreme flooding impacts, etc.) Many federal and state programs require that a portion of funding be set aside for disadvantaged communities or those with economic hardships.

Direct assistance programs are a customer service program (CAP) that provide “direct” relief to the ratepayer by way of bill discounts, debt forgiveness, or crisis assistance. Often, direct assistance programs constitute a cross-subsidy, where one group of customers bears costs on behalf of another; such deliberate cross-subsidies are illegal in many jurisdictions and forbidden by utility policies in others (EPA, 2016, “Customer Assistance Programs”).

Minimum required amount of water needed to fulfill basic residential indoor water uses, such as drinking, bathing, and cooking.

Rate structures that account for consumer type and ability to pay (also see “equity” entry).

An enterprise fund is (mostly) comprised of utility customer fees, and its sole purpose is to cover the utility expenses. An enterprise fund operates independent from a parent government, meaning that its revenues and expenditures should not be commingled with general fund money of the local government.

A repository of finance and funding resources, The Clearinghouse allows users to filter their search based on user type, topic area, and location, and it also includes case studies and webinars.

The U.S. Federal Agency responsible for monitoring environmental issues and implementing environment-related federal policies and practices. The EPA sets standards for monitoring air and water quality, and holds communities accountable to these standards, requiring compliance action and reporting of air and water quality concerns.

The natural system of plants and animals, and water, land, and air resources, that work together to create a habitable community.

Financial savings and efficiencies due to an increase in the number of users.

Water rates that are set based on the full or comprehensive cost of water service (i.e. water collection, treatment, transmission, operations, and maintenance.) Full-cost pricing helps utilities ensure that they will collect enough revenue to cover the costs of operating and maintaining their system.

Frontline communities typically bear the largest burden of environmental and economic injustice, and generally are the first to experience challenges and endure the greatest impact of those challenges. In the United States, due to historical and current practices of discrimination and racism, frontline groups usually consist of Black, Indigenous, and People of Color, who also typically have low  or unstable incomes, disabilities, and/or lack citizenship status.

Flooding occurs when rainfall or snowmelt overwhelms wastewater infrastructure and waterways, and makes its way into basements, backyards, and streets.  Flooding is intensified by more frequent and severe rain events due to climate change, and many communities do not have the wastewater or stormwater infrastructure capacity to handle these events.

The ability of the community (as a whole, or on average), to bear the costs of service (versus affordability, which considers the ability of individual households and water utility customers).

Initiatives created by federal agencies to implement federal policies.

Policies passed by Congress that are enacted at the federal level and administered by a federal agency.

Agencies that operate within the federal government and address specific policy areas, such as the environment (Environmental Protection Agency), housing (Housing and Urban Development), health (Health and Human Services), and energy (Department of Energy).

An initiative created by the American Recovery and Reinvestment Act (ARRA) that aims to increase investment in green infrastructure, water and energy efficiency, or other environmentally innovative activities. ARRA requires that all states set aside a portion of their Drinking and Clean Water State Revolving Loan Funds for Green Project Reserve projects.

Grants are funds that do not require recipient repayment. Thus, grants tend to be very competitive — while they rarely cover the full costs of projects, grants can be very helpful in covering some implementation costs, especially in disadvantaged communities (see the “loan” entry).

Introduced in 2020 during the COVID-19 pandemic, H.R. 6552 declared that water to be a human right and proposed the creation of a grant program to assist low-income households in affording drinking water and wastewater services. The Act, which did not pass, would have authorized a pilot program consisting of mini-grants awarded to drinking water and wastewater system operators to develop and implement customer assistance programs (CAPs), including percentage-of-income payment plans, direct billing assistance, lifeline rates, bill discounts, household conservation retrofits, and others.

When a water utility shuts off water services for a household without the household’s consent, often due to unpaid bills. Water shutoffs can create enormous, and sometimes long-lasting, problems for those impacted, including health and sanitation, credit, child custody, and homeownership issues.

A published document the identifies the planned uses of all Clean Water and Drinking Water State Revolving Fund programs. Intended use plans describe how those funds will be used to support the overall goals of the programs, and explain how the projects have been prioritized (also see “project priority list” entry).

Sometimes referred to as a “one water” approach, integrated resource planning utilizes least-cost planning strategies (e.g. using cost-benefit analyses to make investment decisions), and incorporates scenario planning, participatory decision-making, and community involvement. Integrated resource planning also considers wastewater and stormwater systems alongside water supply systems, because each system is connected to the overall quantity and quality of the water system.

In the context of this toolkit, influence refers to the power that an individual, organization, or coalition has to initiate or affect change at the local, state, or federal level (also see the “advocacy” entry).

A natural process in which water (typically rainwater) soaks a porous/permeable surface such as soil, rather than running off an impermeable surface like concrete. The process of infiltration may remove some rainwater pollutants, which can help protect local groundwater and surface water quality. Infiltration is one of the primary mechanisms by which green stormwater infrastructure reduces flooding, as rain drops sink where they fall rather than running into a wastewater pipe.

A type of customer assistance program (CAP), income payment plans establish a payment plan inline with household income; these payment plans are typically available to households with overdue bills, or bills that are too high to pay in a lump sum.

A type of bond where buyer interest payments are tied to the project performance. The projects funded by these bonds usually have social and environmental benefits (see the “social impact investing” entry).

Introduced in 2018, this bill would have established a new pilot program that issued grants to community water systems to develop low-income household assistance programs. Though did not pass, its language has informed subsequent legislative efforts, including H.R. 6552.

While there isn’t necessarily an industry-agreed upon term, low-capacity communities are understood to have fewer staff and financial resources to plan, implement, and operate infrastructure, whereas high-capacity communities are well resourced and can take on projects proactively and strategically. Federal and state programs should orient technical assistance toward low-capacity communities to ensure that they receive needed support to avoid infrastructure failures.

A loan is a financing tool in which an amount of money is lent from one entity to another with a promise to repay the principal amount plus interest. Loans are prevalent in water infrastructure financing, and federal and state governments often work to reduce interest rates so loan programs are more accessible to municipalities, especially those that have communities with economic hardships.

The practice of using funds from a given source to attract other investment sources for a project. For example, when looking at the Water Infrastructure Finance and Innovation Act, common leveraging sources include SRF funds, private capital, and local investment, including bond issuance.

A method of planning that uses cost-benefit analyses to achieve the least-cost outcome. To ensure that least-cost outcomes do not cause harm to vulnerable/disadvantaged communities, least-cost planning must be done with an equity lens.

Land use refers to the way that communities use land, e.g. residential neighborhoods, agricultural land, park land, conservation areas, commercial corridors, industrial zones, etc. Land uses impact wastewater, drinking water, and stormwater systems in different ways (i.e. agricultural and industrial land use practices might contribute to source water quality impairments, requiring expensive clean-up efforts).

The process of installing meters in order to measure how much water a customer uses per billing cycle. Meters can also help individuals prevent excess water loss by accurately reporting household water use.

The middle value in a collection of numbers, where 50 percent of the group is below the value and 50 percent is above the value. Median Household income is commonly used to measure affordability of water services, though there are well documented flaws with this metric, such as the fact that it does not consider the prevalence of poverty throughout a community.

The cost to upkeep water infrastructure to ensure equipment continues to work efficiently and can achieve the operational goals, e.g. cleaning, calibration, leak detection and repairs, greasing, etc. Maintenance costs are often combined with operation costs when using the term “operations and maintenance,” or O&M.

Pollution that is generated from a widespread source, such as excess fertilizer on grass and farms, as opposed to a specific point, such as a pipe from a factory. Projects are often designated to address nonpoint pollution, specifically.

The idea that when one alternative is chosen, there is a loss of potential gain from other alternatives.

A formal process whereby feedback and suggestions can be made about a proposed rule or regulation that is under consideration by the governing agency. Public comments are one form of influence that individuals or groups have on local, state, and federal decision-making.

The idea that when one alternative is chosen, there is a loss of potential gain from other alternatives. Project priority lists are part of an Intended Use Plan; they include projects that will score highly when looking at state revolving fund criteria, and are therefore most likely to be funded.

The ability to organize resources (e.g. money) and people to implement an action or idea. Those with power have the ability to choose between desirable options.

Potable water has been treated to ensure safe consumption; also referred to as “drinking water.”

When harmful substances, such as chemicals or microorganisms, contaminate a body of water (e.g. a lake or river).

An initial, small-scale adaptation of a program to test its effectiveness and operation, often used to determine if a program should be expanded and implemented on a larger scale.

A green stormwater infrastructure technique, permeable pavement has a porous surface that allows stormwater to infiltrate rather than run off into the sewer system. Porous surface types include interlocking bricks, gravel, or permeable asphalt or concrete.

The goals that a program intends to accomplish; ideally, these goals should be measurable.

In general, this concept captures the fact that future water costs will be greater than past water costs, which have historically been quite low. These historically low rates have contributed to the underinvestment in U.S. infrastructure, which has led to failings and contributed to affordability challenges.

Infrastructure is right-sized when the amount of gray water infrastructure (pipes, tunnels, treatment facilities) is proportional to the population — when an infrastructure system is too large, it can lead to high water bills because there are fewer customers to pay for its maintenance, and when an infrastructure system is too small, water bills may be higher due to stress, overload, and increased incidences of system failure.

The money that the water utility collects in rates and fees from its customers.

In the context of water affordability, retrofits typically refer to the installation of conservation or efficiency fixtures to reduce water usage and save money.

The process by which two or more nearby utilities merge into a single entity, bundle resources, coordinate processes (such as rate setting), establish new governance structures, and share resources.

The consumer who is served by the water utility and pays the water bill.

The pricing method a utility uses to calculate how much a consumer will pay for water usage; it includes both the base (fixed) fee and the volumetric charge.

A green stormwater infrastructure technique, a rain garden it is a vegetated bowl designed to collect, retain, and infiltrate stormwater using natural processes. Rain barrels such as bioswales are generally designed to have engineered soil and native plants to improve onsite stormwater infiltration and retention capacity.

A body of elected officials who represent their constituents by researching, writing, and enacting state law (legislation), and performing an oversight role for the state executive branch.

Utilities and private wells draw source water from rivers, streams, lakes, and springs — source water protection includes a wide variety of actions for safeguarding or improving the quality and/or quantity of drinking water sources and their contributing areas.

Also called socially responsible investing, or ESG (environmental, social and governance) investing, social impact investing focuses on companies and organizations that promote ethical and conscientious considerations, such as environmental sustainability, social justice, and corporate ethics.

A term used to describe an infrastructure project that is considered to be at an advanced enough stage of development for implementation to begin; planning may be almost complete, and approval permits may already be in place, or can be quickly obtained.

A percentage of State Revolving Loan funds that go toward general activities such as operator certification and technical training, i.e. set-asides are not used to directly fund infrastructure projects.

The smaller pipe that connects a property to the public water supply line (which is sometimes referred to as the water main).

Houses and other buildings that are not connected to a public system treat their wastewater onsite via a septic system that is comprised of a septic tank and drainfield (i.e. shallow, covered drains). The septic tank is the underground water-tight container that holds the wastewater long enough for solids to settle down to the bottom before the liquid components enter the drainfield.

Water rates that vary based on the season, e.g. a utility might implement higher rates in the summer to discourage excessive water use (particularly for irrigation purposes).

Surface water is any body of water that is above ground, including rivers, lakes, streams, wetlands, and reservoirs. Many communities draw their water supply from lakes and reservoirs, and discharge stormwater and treated wastewater into rivers and streams.

Typically used in the energy sector, utilities set higher rates during peak usage hours and lower rates during off-peak hours. This rate variability incentivizes customers to use less energy during peak hours, which saves them money, and helps the utility meet efficiency goals and conserve resources.

A type of municipal bond where the bond-buyer does not have to pay taxes on bond income.

A type of volumetric charge where each unit of water after any base (fixed or service) charge is set at the same price (e.g. $8 per thousand gallons).

Underbounded communities are created when, in an effort to avoid providing services, municipalities elect not to annex nearby unincorporated communities. Because underbounded areas are socioeconomically disadvantaged (particularly those that are low-income and/or majority BIPOC), these communities struggle to make needed infrastructure upgrades, which increases the risk of infrastructure failure.  These communities typically fall into the “disadvantaged, vulnerable, or economically-hardshipped communities” category.  (Texas A&M University, “On Municipal Underbounding”)

Vulnerable populations can either refer to specific groups of people, e.g. children younger than 18, aging adults 65 years and older, pregnant women and nursing mothers, persons with disabilities, and persons with chronic illnesses, or to specific households and communities who face threats to water access and affordability.

An area of land that drains or “sheds” water into a specific waterbody (creek, river, lake etc.)

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The entity responsible for water treatment, distribution, rate-setting, and issuing water charges (i.e. the entity that generates a water bill).

The source water and infrastructure (i.e. pipes and treatment facilities) needed to deliver water to households, businesses and industrial customers.

WRDA is federal legislation through which Congress appropriates funds for water infrastructure and amends U.S. Army Corps of Engineers authorizations. WRDA bills typically pass biennially, and their impact varies depending on the interests and commitments of the legislative and executive branches.

The entity responsible for water treatment, distribution, rate-setting, and issuing water charges (i.e. the entity that generates a water bill). Water quality refers to the cleanliness and safety of drinking water or a body of water. The Environmental Protection Agency (EPA) regulates water quality and sets different standards based on how the water will be used. For instance, drinking water must be treated to a different standard than a river or stream. The Clean Water Act regulates the discharge of pollution into waterways and sets water quality standards aimed primarily at protecting natural resources. The Safe Drinking Water Act regulates drinking water and sets protective drinking water standards for more than 90 contaminants. Communities are required to produce annual water quality reports to ensure compliance with federal regulations.

Utilities treat and transmit billions of gallons of water every day…and every day billions of gallons of water are lost due to system leaks or water main breaks, loss that costs utilities and, subsequently, ratepayers trillions of dollars. Good asset management, auditing practices, and comprehensive residential metering can help utilities get a handle on water loss levels and begin to recoup these losses.

Established in 2014, WIFIA is a federal water infrastructure financing program whereby communities can cover up to 49 percent of project costs using low-interest WIFIA funds, which can support a broad array of water infrastructure investment efforts.

Includes all the sewer pipes, water mains, treatment centers, flood control measures, water storage units and dams, chemicals, energy, and other elements that supply and manage water, wastewater, and stormwater. Water infrastructure also includes natural processes, such as green stormwater infrastructure, that manage stormwater and protect local water quantity and quality.

Practices and equipment (e.g.  low flow toilets) that reduce water use at the household level or throughout an infrastructure system. Reduced water use supports affordability outcomes by lowering bills, and also protects source water by reducing the need for increased water withdrawals or the development of new sources.

The document that shows how much a water/wastewater customer owes the utility that, ideally, includes the volume of water that the customer used — visit the “Utilities” section of this guide for details about the components and corresponding terminology of a water bill.

A report of all of the infrastructure (pipes, plants, etc.) in a system that outlines water use for each infrastructure unit, logs repairs (completed and forthcoming), and cites other planned investments. An audit report supports good asset management practices.

Water audits are an assessment of water treated, transmitted, used, and lost throughout the water supply system. A water audit can help utilities identify leaks in their water infrastructure and strategically address leaks, based on level of loss identified.