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Small Loans Program

The Small Loans Program (SLP), a subprogram within the Clean Water Fund Program (CWFP), provides interest rate subsidies to eligible applicants for State Trust Fund (STF) loans used to fund DNR-approved wastewater and storm water infrastructure projects. Total project costs must be $2 million or less after all contracts are awarded. The SLP may not subsidize STF interest charges for projects that have been completed for more than three years.

Who may apply?

Eligible applicants include Wisconsin cities, towns, villages, counties, sanitary districts and other qualifying municipalities.

How may funds be used?

The program funds are for reasonable and necessary costs directly related to the planning, design, and construction of eligible projects that are needed to achieve or maintain compliance with federal and state regulations and Wisconsin Pollutant Discharge Elimination System (WPDES) permits. Funds may be used to construct, improve, modify, purchase, replace, restore and upgrade systems and infrastructure that are used for collection, transmission, storage, treatment and disposal of wastewater, or for collection and treatment of storm water. The parallel cost percentage will determine what percentage of costs are eligible for interest rate subsidy.

  • For a list of eligible projects, see s. NR 162.39, Wis. Adm. Code.
  • For a list of eligible costs, see s. NR 162.40, Wis. Adm. Code.

The following is a partial list of eligible projects and costs:

  • A project necessary to prevent a municipality from significantly exceeding a wastewater effluent limitation contained in its WPDES permit.
  • A project necessary for the replacement or major rehabilitation of an existing sewer collection system and necessary to maintain the integrity and performance of the treatment works serving the municipality.
  • A project necessary to eliminate actual or imminent pollution of groundwater, surface water or threat to human health in unsewered areas within a municipality.
  • The construction of individual systems serving one or more residences, if the municipality complies with the requirements of s. NR 162.39(3), Wis. Adm. Code.
  • Storm water projects must lead to, or provide, treatment to control discharged water quality.

The following is a partial list of ineligible projects and costs:

  • Projects with total costs in excess of $2,000,000.
  • Hook-up charges payable to other municipalities.
  • Storm water projects that are solely for drainage and flood control.
  • Costs included in the STF loan that are not related to the wastewater or storm water project.
  • Laterals that transport wastewater from structures to municipally- or privately-owned wastewater systems.
  • Sewers that only serve development not in existence as of the date of the SLP Interest Rate Subsidy Application.

What are the effective interest rates?

This PDF shows the effective interest rates for approved projects after the SLP subsidy is applied. The amount of subsidy provided under the SLP may not exceed the amount of subsidy that would have been provided on a loan for the project through the CWFP. Note that the SLP does not offer principal forgiveness.

What influences the amount of SLP subsidy?

The share of the interest cost paid by the SLP varies from time to time. It depends on the following variables:

  • STF interest rates are variable depending on loan terms and current market conditions. Current STF rates are available at
  • CWFP interest rates are variable depending on municipal population, MHI, current market conditions. View the current interest rates at
  • The portion of an eligible project specifically related to receiving, storing, and/or adding capacity for the treatment of septage will receive an effective interest rate of 0%.


Interest subsidy

The SLP pays part of the interest cost for your loan.

No federal requirements

Projects do not need to comply with certain federal requirements, such as American Iron and Steel, cost and effectiveness certification, disadvantaged business enterprises, fiscal sustainability plan certification and prevailing wage rates.

No issuance costs

The SLP does not charge an application or closing fee. The program does not require you to hire a bond counsel. A CWFP administrative fee, if imposed, shall be included in the biennial finance plan established under s. 281.59 (3), Wis. Stats., which is approved by the building commission under s. 13.48, Wis. Stats.

How and when do we apply?

The SLP encourages municipalities to apply for an STF loan before submitting an SLP application. A municipality should arrange its submittal of the Interest Rate Subsidy Application after the STF approves its STF loan.

State Trust Fund application

Direct questions about the STF loan application to the BCPL Loan Officer at

Small Loans Program application

To receive an interest rate payment from the SLP, you must submit a notice of Intent to Apply (ITA) and an Interest Rate Subsidy Application.

SLP intent to apply

Municipalities who intend to apply for any type of financial assistance through the CWFP are required to submit a notice of Intent to Apply (ITA) as established in s. 281.58, Wis. Stats., and ch. NR 162, Wis. Adm. Code. The ITA must be submitted using the online system by Oct. 31 at 11:59 p.m. of the year prior to the intended interest rate subsidy application date. Information regarding the Priority Evaluation and Ranking Formula (PERF) is required as part of the ITA submittal.

ITAs must be submitted for all CWFP projects, including SLP projects. All ITAs must be submitted annually until the requested financial assistance has been awarded because ITAs are only valid for one state fiscal year (July 1 through June 30). Failure to submit a complete ITA for the appropriate state fiscal year may result in the denial of project financing.

SLP interest rate subsidy application

Applications for Small Loans Program projects are accepted throughout the state fiscal year for which there is a valid ITA. So, if your project has a valid ITA listed on the state fiscal year 2021 Project Priority List (PPL), then you may submit an SLP application anytime between July 1, 2020, and June 30, 2021.

The SLP Interest Rate Subsidy Application Form is authorized by s. 281.58, Wis. Stats. Submitting a completed form and a proposed or executed inter-municipal agreement, if applicable, to the DNR is mandatory for each applicant seeking interest rate subsidy from the CWFP. Failure to submit a complete application to the DNR may be grounds for denial of the application.

Per s. NR 162.41, Wis. Adm. Code, at a minimum, a complete application must include the following:

  • Evidence of an approved facility plan or other DNR approved plan.
  • Evidence of biddable and approval Plans and Specifications submitted to the DNR Bureau of Water Quality.
  • Two copies of a complete Interest Rate Subsidy Application Form, including estimated or actual construction costs and replacement fund information.
  • A proposed or executed inter-municipal agreement in cases where 2 or more municipalities discharge to or through the same treatment works or BMP.
  • Signed BCPL loan documents including copies of the STF loan application, application review letter, and Certificate of Indebtedness.
  • Evidence of Parallel Cost Estimate submitted to the DNR Bureau of Water Quality

Incomplete applications will be ineligible for loan funding for the applicable fiscal year. If the municipality chooses to move forward with the project, the Interest Rate Subsidy Agreement (IRSA) may not be processed until the application is made complete.

The submission of additional documentation is required, per s. NR 162.42, Wis. Adm. Code, before a DNR loan project manager can prepare the municipality's IRSA. After the successful submission of a complete application, your project manager will work with you on the submittal of these documents and establish a realistic timeline for issuing the IRSA.

Deadline for signing the IRSA

An applicant shall sign an IRSA within eight months after the date the department notifies the applicant that the application is accepted. If an IRSA is not signed within eight months of the DNR's notification of acceptance, the applicant's project shall lose its allocated subsidy, and the municipality will need to apply again for financial assistance in another fiscal year if they still wish to receive an interest rate subsidy for the project.


After the execution of the IRSA, DOA may provide interest rate subsidy for the eligible portion of project costs incurred within the scope of a scored project. The DNR shall determine compliance with the terms and conditions of the IRSA before interest rate subsidy payments are made. Subsidy payments shall be applied to the interest due on the STF loan.

Project closeout

Before the project closeout, the DNR shall determine that all the applicable requirements of s. NR 162.47(4), Wis. Adm. Code, are met.


Each January, the STF invoices the municipality for a loan payment due on March 15. Prior to the March 15 loan payment, the SLP sends the municipality a check for part of the loan interest. The municipality deposits the check and makes its STF loan payment.

A municipality may prepay all or a portion of its State Trust Fund loan without penalty from Jan. 1 to Aug. 31 each year. A 30-day notice of prepayment is required by STF. The SLP will adjust the remaining interest subsidy payments to reflect any prepayments.

Contact information
For information on the Small Loans Program, contact:
Kevin Olson, SLP specialist
For information on the State Trust Fund loans, contact:
Board of Commissioners of Public Lands loan officer

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Disclaimer of guidance: This document is intended solely as guidance and does not contain any mandatory requirements except where requirements found in statute or administrative rule are referenced. Any regulatory decisions made by the Department of Natural Resources in any matter addressed by this guidance will be made by applying the governing statutes and administrative rules to the relevant facts. Program implementation details are outlined in the governing administrative codes and statutes: §§ 281.58 and 281.59, Wis. Stat., and § NR 162.38, Wis. Adm. Code.