Wyoming Governor Mark Gordon and state officials have taken back $6.2 million in federal funds from some small towns and redistributed it to others that are on track to complete important water and sewer projects before the end of the year. If they hadn’t done this, the money would have been returned to the federal government.
Some small towns like Lingle, Wamsutter, and Big Piney struggled to meet the strict federal requirements for these funds and had tight deadlines to complete the necessary studies and prepare projects. As a result, local officials had to compete with other towns for a limited number of engineering and construction firms to get the work done.
Governor Gordon said that the state anticipated this situation and had set a deadline of October 1 for towns to meet the federal compliance requirements. Those who didn’t meet the deadline risked losing their grants. The $6.2 million that was returned will now be used by other towns that met the deadlines to help with their project funding.
The funds come from the American Rescue Plan Act (ARPA), a federal program with $350 billion for pandemic recovery and infrastructure projects, including upgrades to water and sewer systems. Wyoming received over $1 billion from this fund, with $144 million allocated for water and sewer improvements.
Dozens of Wyoming towns will benefit from these ARPA grants, including projects like sewer upgrades in Laramie and water tank repairs in Shoshoni. However, some towns that lost their grants will now have to find other funding sources for their water system upgrades.
Justin Schilling from the Wyoming Association of Municipalities said that while it’s difficult for towns to lose these funds, the state had to act to ensure the money didn’t go back to Washington D.C. The state has also been working to reallocate other ARPA funds for various pandemic relief efforts.
Wyoming’s water and sewer systems are aging, and many towns struggle to afford expensive upgrades. Some, like Rawlins, need millions of dollars to replace old water pipes. Meanwhile, other towns, like Midwest and Edgerton, rely on ARPA funds to replace old pipelines that are at risk of corrosion due to the environment.
Delays in funding can lead to higher costs as prices rise and competition for contractors increases. With federal infrastructure projects happening across the country, Wyoming’s towns are competing for a small pool of contractors.
To address the funding gap, Wyoming is turning to its Mineral Royalty Grant program, which uses federal mineral royalties to help towns with water and sewer projects. Governor Gordon has proposed adding $20 million to this program to help with urgent projects, though past funding requests have been reduced. If approved, the program could have $47.5 million available for the 2025-26 budget cycle.