This report examines the condition of wastewater treatment facilities in communities of 10,000 persons or fewer. Capital spending requirements for these systems in 1988 are estimated at $13.7 billion and are expected to grow by $4.4 billion over the next 20 years. Likewise, the number of persons receiving sewage treatment will grow from 32 million to 57 million by the year 2008. Analysis of the excess flow capacity of small-community systems shows the average system was operating at 80 percent of capacity, while 20 percent of existing systems were operating in excess of current design flows.