South Dakota communities and rural water systems are receiving nearly $39 million in state and federal funding for drinking water and solid waste projects across the state.
The South Dakota Board of Water and Natural Resources approved $38.9 million in loans and grants at its meeting in Pierre Thursday, including $19.6 million in low-interest loans and $19.3 million in grants.
The funding will support projects ranging from a new water tower in Aberdeen and water-system improvements in Milbank to a major regional water project serving Clay County and upgrades to the Northwest South Dakota Regional Landfill.
The awards come through the Department of Agriculture and Natural Resources’ Drinking Water State Revolving Fund Program, Drinking Water Emerging Contaminants for Small or Disadvantaged Communities program, American Rescue Plan Act funds and Solid Waste Management Program.
Clay Rural Water System received the largest single award, a $16.5 million Drinking Water Emerging Contaminants for Small or Disadvantaged Communities grant to connect the system to the city of Elk Point.
The project will include approximately 23 miles of pipe, a 500,000-gallon storage tank, a booster station and a master water meter.
Elk Point also received $730,000 through the Drinking Water State Revolving Fund Program to connect its existing water system to Clay Rural Water System with a new 1,400-foot water main. The loan carries a 3.75 percent interest rate over 30 years.
Milbank received a $10 million Drinking Water State Revolving Fund loan to install package filters and an aeration unit in its water treatment system. The loan carries a 3.75 percent interest rate over 20 years.
Aberdeen received $2.5 million through the Drinking Water State Revolving Fund to construct a 1.5-million-gallon elevated water tower and a 16-inch transmission line connecting existing residents in the northeast part of the city.
The city previously received $10 million for the project. The latest loan, which carries a 3.75 percent interest rate over 20 years, completes its funding.
Randall Community Water District received $5 million through the Drinking Water State Revolving Fund to expand system capacity and provide additional water to Mitchell.
The project includes a new 30-inch HDPE transmission line, booster stations, storage facilities and upgrades to the treatment facility. The loan carries a 3.75 percent interest rate over 30 years.
The water district also received an additional $905,000 in ARPA grant funding for the project, bringing its total ARPA grant award to $23.97 million. Previous grants and loans for the project total more than $118 million.
Kingbrook Rural Water System received an additional $250,000 in ARPA grant funding for upgrades at two water treatment facilities, four pump stations, an elevated tank near Arlington and a pipeline along Highway 25 north of DeSmet.
The additional award brings the project’s total ARPA grant funding to $15.12 million. Previous funding was approved in April 2022 and June 2024.
Mid-Dakota Rural Water System received an additional $600,000 in ARPA grant funding for improvements that include advanced metering infrastructure, paralleling of pipe, a new backwash recovery system and additional membrane capacity.
The additional award brings the project’s total ARPA grant funding to $22.22 million. Previous funding was approved in April 2022, June 2024 and January 2026.
Shared Resources Inc. received an additional $905,341 in ARPA grant funding for a project that includes a new water treatment plant, well field, distribution pipeline and two storage tanks.
Shared Resources is a joint effort between Minnehaha Community Water Corporation and the Big Sioux Community Water System. Previous funding was approved in April 2022, June 2024, May 2025, January 2026 and June 2026.
The additional award brings the project’s total ARPA grant funding to $52.05 million.
The Northwest South Dakota Regional Landfill received a $129,000 Solid Waste Management Program grant and a $502,000 loan to replace aging equipment and purchase a new bulldozer, roll-off trailer and 10 garbage dumpsters.
The loan carries a 3.50 percent interest rate over 10 years.
Webster received a $908,000 Drinking Water State Revolving Fund loan, including $726,000 in principal forgiveness, to replace 1,075 outdated water meters and upgrade the city’s software and remote-reading system.
The loan carries a 2.50 percent interest rate over 10 years.
The Solid Waste Management Program provides grants and loans for solid waste disposal, recycling and waste tire projects. The Legislature annually appropriates funding for the program through the Omnibus Water Funding Bill.
The Drinking Water State Revolving Fund programs are funded by the state and U.S. Environmental Protection Agency and provide low-interest loans for public drinking water system projects and other water-quality projects. Funding comes from federal appropriations, loan repayments and bonds.
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