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Governor Ivey Announces Funds Transferred to ADEM for Statewide Water and Sewer Projects

MONTGOMERY – Governor Kay Ivey announced today that the Alabama Department of Finance has signed an agreement with the Alabama Department of Environmental Management (ADEM) that officially provides $225 million in COVID-19 relief funds to ADEM for grants to provide or improve water and sewer services to residents across the state.

The money is from Alabama’s share of the American Rescue Plan Act (ARPA) funds passed by Congress in 2021. The Alabama Legislature appropriated the $225 million for high-needs water and sewer projects during a Special Session called by Governor Ivey in January. In its appropriation, the Legislature directed the funds to the Department of Finance and designated ADEM to oversee the program.

The memorandum of agreement signed by the Department of Finance and ADEM will provide the funds to ADEM to be distributed as grants to “qualifying public water and sewer systems for the purpose of improving access to clean water and sewer infrastructure projects and the economic impact thereof,” according to the agreement. ADEM will implement the “Water and Sewer Infrastructure COVID-19 Recovery Fund Program” using criteria that weighs the water and sewer systems’ infrastructure needs and their financial needs.

“Every Alabamian should have access to clean drinking water and safe, sanitary disposal of wastewater,” said Governor Ivey. “We are extremely pleased that through this program we are able to make that a reality for many of our citizens who have lacked such basic services. Not only will these projects improve access to clean drinking water and sanitary sewers, they will also generate economic activity and create jobs by pumping millions of dollars into communities, many of which are rural and far from large industries and big employers. This is truly a win-win for the people of Alabama.”

Of the $225 million, the Legislature appropriated $120 million for grants to public water or sewer systems with previously identified emergency or high-need projects and do not require a local match; $100 million for grants to public water and sewer systems that may require local matching funds based on their ability to pay; and $5 million for grants to demonstration projects in the Black Belt to address sewage disposal problems prevalent in rural, low-population-density areas where poor soil conditions prevent wastewater from septic systems from being absorbed into the ground.

ADEM already manages two State Revolving Fund loan programs – one for drinking water systems, the other for sewer systems.

It announced Tuesday that 398 of the state’s 1,061 public water and sewer systems – 37 percent – already had applied for grants under the COVID-19 Recovery Fund Program.

“This is an indication of the tremendous needs that exist among water and sewer systems,” said ADEM Director Lance LeFleur. “It is also indicative of the vast water and sewer infrastructure needs across the country due to aging systems, increased demand because of population growth and the need to provide services to people who are currently unserved or underserved. Many of these systems haven’t upgraded their infrastructure in 40 to 50 years.”

For more information about the water and sewer projects, go to The site also provides regular updates on grant applications, links to water and sewer grant application forms, and ADEM contact information.