Safe Drinking Water Boost: Minnesota Town Secures $5.54 Million for New Facility

The City of Underwood is set to see major improvements to its water infrastructure thanks to a $5.54 million financing package awarded by the Minnesota Public Facilities Authority (PFA). The funding will allow the community to construct a new water treatment plant, replacing aging facilities and adding modern filtration systems to ensure safe and reliable drinking water for residents and businesses.

The funding announcement follows approval of a bipartisan $700 million capital investment package during the 2025 legislative session, which included significant resources for clean water projects across Greater Minnesota. Senator Jordan Rasmusson, who authored the legislation, said the investment is part of a broader effort to strengthen essential infrastructure in communities across the state. “Congratulations to the City of Underwood on receiving this important funding,” he said. “Clean water is foundational for every thriving community, and this project will keep Underwood’s water system strong for years to come.”

The financing package includes a $1.7 million loan through the Drinking Water State Revolving Fund, a $3.5 million grant through the Drinking Water State Revolving Fund – Principal Forgiveness program, and a $350,000 grant from the Water Infrastructure Fund. Together, these resources will make it possible for Underwood to undertake a project that would otherwise have been financially out of reach for the small city.

Mayor Anna Kiser expressed gratitude for the award, noting how critical it is for communities like Underwood to receive state support. “Safe drinking water is a right for everyone. Without the assistance of organizations like PFA, small cities would disappear,” she said. “The funding that the City of Underwood is receiving will enable us to continue to provide safe water to our residents and businesses at a rate our property owners can afford while still being able to enjoy all that our small community offers. For that, we are always grateful.”

The new water treatment facility is expected to resolve ongoing maintenance challenges and reduce costly repairs, providing a more sustainable and efficient system. Once completed, residents will benefit from improved water quality and long-term reliability.

The Minnesota Public Facilities Authority plays a central role in strengthening communities across the state by providing financing and technical assistance for essential infrastructure projects. By helping local governments construct and modernize facilities, the PFA supports public health, protects the environment, and promotes economic growth.

The investment in Underwood is one more example of how strategic funding can help small towns thrive while preserving affordability and quality of life for their residents.