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This article discusses the establishment of the Drinking Water State Revolving Fund (DWSRF), authorized by the Safe Drinking Water Act (SDWA) amendments of 1996 to create new funding for states and their public water systems. The article discusses the following aspects of the DWSRF: appropriations increases; flexibility in developing DWSRF programs; implementation of DWSRF programs by states; a mechanism that allows states to develop a long-term source of lower-cost funding; and, set-aside funding. Includes reference, tables.