Purpose

• Establishment of a grant program to support planning and assistance for drinking water regionalization, helping counties, municipalities, and townships create or expand regional drinking water systems.

Main Provisions

• Eligible recipients
  • Grants are available to counties, municipalities, and townships that want to pursue regional drinking water systems under Minnesota Statutes chapter 116A.
• Eligible expenses
  • Funds may be used for planning activities, including feasibility studies, engineering analyses, legal and financial assessments, community engagement, preliminary and final design work, and activities necessary for district formation under chapter 116A to support regional drinking water infrastructure.
• Grant administration
  • By November 1, 2026, the commissioner of health must develop an application process and selection criteria that prioritize projects addressing aging infrastructure, water quality, affordability, or economic development.
• Grant maximum and match
  • Each grant may not exceed $300,000 per recipient per year.
  • Recipients must provide a matching fund of at least 25 percent of the total grant amount.
• Reporting
  • The commissioner must report by January 15, 2027 to the chairs and ranking minority members of the legislative committees with jurisdiction over water infrastructure. The report should summarize grants awarded, progress of funded projects, and recommendations for future funding to support drinking water regionalization efforts.

Funding Details

• Appropriation
  • $1,000,000 in fiscal year 2027 is appropriated from the general fund to the commissioner of health for grants to counties, municipalities, and townships to support drinking water regionalization efforts.
  • This is a one-time appropriation and is available until June 30, 2027.

Significant Changes to Law

• Creates a new grant program under the health department to support planning and development of regional drinking water systems.
• Establishes specific eligibility, allowable planning activities, and a defined grant cap with a 25% required match.
• Requires an application process and priority criteria focused on aging infrastructure, water quality, affordability, and economic development.
• Allocates a one-time funding appropriation for this purpose and requires a progress/reporting plan by early 2027.

Potential Impacts

• Local governments can plan and move toward regional drinking water systems, which may improve water quality, affordability, and economic development.
• The program funds planning and formation activities but does not directly fund construction, suggesting a preparatory step toward regionalization.
• Communities must meet matching requirements and report on progress to legislators.

Relevant Terms drinking water regionalization regional drinking water systems planning activities feasibility studies engineering analyses legal assessments financial assessments community engagement preliminary design final design district formation Minnesota Statutes chapter 116A aging infrastructure water quality affordability economic development grant recipient grant maximum matching funds reporting general fund appropriation one-time appropriation commissioner of health Department of Health counties municipalities townships