Assistance for Rural Water Systems Act of 2026

This bill provides new grant and low-interest loan options (zero percent or 1 percent interest) for rural water, wastewater, and waste disposal systems. It directly assists eligible rural facilities facing public health/safety needs or financial hardship in disadvantaged or economically distressed areas. Key provisions allow the Secretary to forgive loan principal/interest, modify loan terms, or refinance existing loans - though new loans cannot be combined with these modifications for the same facility. Eligibility for hardship-based assistance requires the Secretary to establish affordability metrics based on water costs relative to median household income in each area. The bill amends existing rural water programs under the Consolidated Farm and Rural Development Act.