$185m in aid set for Mass.

The grants - which will also help communities make energy-guzzling water treatment plants more efficient - will reduce the cost that ratepayers will be assessed for the projects.

US Environmental Protection Agency administrator Lisa Jackson said the stimulus money will create "new opportunities and jobs" for communities, but neither she nor her staff could provide a figure on how many jobs would be created in Massachusetts.

Most of the money will go for projects that were already in the works. "We would have been moving forward with the project anyway," said Ron LaFreniere, commissioner of public works for Marlborough, which is modernizing a waste treatment plant built in 1972.

But the government aid will significantly reduce what the city has to borrow for the $35 million addition, which will filter out 75 percent more phosphorous from water before it flows into the Assabet River.

"That's going to have a dramatic effect on the cost to ratepayers," he said.

Two-thirds of the federal money will be used for 127 projects designed to reduce the flow of sewage and untreated stormwater into rivers and the ocean - from a sewer extension in Acton to a water main replacement in West Springfield. The grants will reduce communities' existing loans for the projects by 8 to 14 percent, and that may spur some to start construction sooner.

"Some cities and towns have been reluctant to move forward with projects because of the high cost, and this is giving them an incentive to get the projects underway," said Bob Keough, spokesman for the state Executive Office of Energy and Environmental Affairs.

The remaining federal money will pay for wind turbines, solar panels, and other measures to reduce energy use by wastewater treatment plants.

"These will be major construction projects, and will put a lot of people to work," said Keough, though he said it was too early to estimate how many.

The money will also help reduce energy use at wastewater plants, said Jackson, noting that in some communities the plants are the largest users of energy. "The idea is that over time you make that plant energy-neutral or even energy-generating," she said in an interview.

The State Revolving Fund grants low-interest loans to water and sewage districts using state and federal money. Projects that have been approved for these loans are the ones eligible for the cost-reduction grants. This year, the fund approved 80 sewer upgrades that total about $744 million and 52 drinking water projects for $242 million.

The Massachusetts Water Resources Authority, which delivers drinking water and scrubs wastewater for about 2 million people in Eastern Massachusetts, received $25 million in loan reductions under the stimulus plan. About $1.6 million will go to install rooftop solar panels at the Deer Island Sewage Treatment Facility. The MWRA currently gets about 20 percent of its electricity from methane created by its waste treatment. It is also erecting two wind turbines.

While the stimulus money is welcomed by cash-strapped city governments, some are concerned about the strings attached and the tight deadlines.

Brendan O'Regan, director of the Newburyport Department of Public Services, said getting help to pay for modernization of his town's 25-year-old wastewater treatment plant will reduce costs to ratepayers, but he worries about the Aug. 1 application deadline. "My concern is that in trying to meet these deadlines, you jeopardize the quality of the project," he said.

In Gloucester, public works director Michael Hale is working on an upgrade of the city's 24-year-old waste treatment plant and a $4 million project to separate sewer and storm runoff drains. The 10 percent reduction in the amount the city will have to borrow helps, he said, but the federal grants have more restrictions and tighter deadlines than if the city funded the work using traditional municipal bonds.

"We're doing the upgrades regardless of the stimulus money," he said. "These are basic upgrades. We're not putting in shiny doorknobs and marble bathrooms, but fixing the moving components of the plant."

The Massachusetts funding announced yesterday is part of $6 billion being awarded from the American Recovery and Reinvestment Act to fund water and wastewater infrastructure projects across the country in the form of low-interest loans, principal forgiveness, and grants.

Beth Daley of the Globe staff contributed to this report. Tara Ballenger can be reached at tballenger@globe.com.