$120M Water Infrastructure Loan Awarded in CA

WEDNESDAY, APRIL 13, 2022


Earlier this month, the U.S. Environmental Protection Agency announced it has awarded a $120 million Water Infrastructure Finance and Innovation Act loan to a utilities agency in San Bernardino County, California. The Inland Empire Utilities Agency will use the loan to implement its Regional Wastewater System Improvements Program, supporting high-quality recycled water and access to reliable, long-term wastewater treatment.

“I want to congratulate the Inland Empire Utilities Agency for developing a water reuse program to meet current and future needs while utilizing EPA’s low-interest and flexible WIFIA loan to reduce costs,” said EPA Assistant Administrator for Water Radhika Fox.

“Investing in water infrastructure is a win-win for public health, the environment, and job creation and we look forward to bringing these benefits to communities across through country through WIFIA and investments through the Bipartisan Infrastructure Law.”

The Regional Wastewater System Improvements Program will reportedly upgrade four wastewater treatment facilities to help to mitigate the impacts of climate change its service area, which is prone to droughts. The program is anticipated to ensure reliable access to wastewater treatment and recycled water and reducing reliance on imported water supplies. 

Additionally, improvements through the program will safeguard that IEUA continues to maintain compliance with statewide standards for recycled water production. According to the project’s fact sheet, the loan will go towards four projects to:

  • Expand the system's capacity;
  • Increase its solids handling capacity;
  • Increase the flow capacity and overall efficiency of lift stations; and
  • Enhance the facility’s ability to reliably produce high quality recycled water.

Construction will include a new solids treatment facility, offsite pump stations and force mains, increased stream capacity, and replacement of the existing conveyance pipelines, headworks, odor control systems and aeration blowers, the EPA reports.

Overall, the project is expected to serve a population of 875,000 in Chino, California, and surrounding areas. The IEUA reportedly covers 242-square miles and distributes imported water, provides industrial and municipal wastewater collection and treatment services, and other related utility services.

“The Inland Empire Utilities Agency’s project will improve critical water infrastructure, help fight drought and reduce climate change impacts in San Bernardino County,” said EPA Pacific Southwest Regional Administrator Martha Guzman. “Through WIFIA, EPA is delivering on its commitment to modernize the nation’s water infrastructure to improve public health and environmental protection while supporting local economies.”

In January, IEUA announced that it was selected by the EPA as one of 55 project applicants across 30 states invited to apply for a low-interest WIFIA loan. Funding at the time was expected to be approved for $94 million to subsidize its improvement program, a combination of multiple improvement projects across IEUA facilities that aid in safeguarding public health and improving water quality across the service area.

“Given the State’s dire water supply conditions, the time is now to take necessary action and continue to grow and implement investments in water-saving infrastructure. The partnership between IEUA and EPA is critical to providing long-term resource solutions for the region now and into the future,” said IEUA Board President Steve Elie.

“The IEUA Regional Wastewater System Improvements Program will expand capacity to help leverage additional water supplies and infrastructure to ensure continued reliable wastewater services and support continued growth in western San Bernardino County. IEUA and the EPA have had a long-standing partnership and we look forward to our continued collaboration while being a part of the solution for California’s water needs.”

According to the EPA, IEUA will save approximately $27 million by financing with a WIFIA loan. Expected to be completed in 2026, the project construction and operation are expected to create an estimated 780 jobs.

IEUA also received a $196 million WIFIA loan in 2020 for the Regional Water Recycling Plant No. 5 (RP-5) Expansion Project. Also under the agency’s Regional Wastewater System Improvements Program, the project will expand RP-5’s liquids treatment capacity and construct a new solids handling facility to support expected service area growth.

The expansion project is expected to be completed by 2025.

WIFIA Background, Closed Loans

The federal loan and guarantee program was established by the Water Infrastructure Finance and Innovation Act of 2014 by the EPA. The goal of the program is to accelerate investment in the nation’s water infrastructure by providing long-term, low-cost supplemental credit assistance.

In total, since 2017, WIFIA has selected 189 projects to apply for WIFIA loans. The EPA reports that selected borrowers have requested nearly $29 billion.

The Agency has announced 63 loans that total over $12 billion in credit assistance for $26 billion in water infrastructure projects. It has reportedly created more than 73,000 jobs and saved ratepayers over $4.5 billion.

In looking at last year's numbers through a WIFIA program report released in February, the Agency only closed 27 loans, totaling over $4 billion. However, despite the challenges faced last year in wake of COVID-19, the Agency reports to have $11 billion worth of projects in the pipeline and a portfolio of 41 loans which supplied $7.8 billion in total financing.

“With the recent selection of 58 new projects, including a record number of projects serving small communities, drinking water needs, and lower-income populations, I am looking forward to what 2021 holds for the program and the new opportunities we will have to help finance critical water infrastructure projects,” wrote Jorianna Jernberg, Acting Director, WIFIA Management Division.

In breaking down the program’s accomplishments and funds requested by project type:

  • $6.8 billion for wastewater;
  • $6.3 billion for drinking water;
  • $2.5 billion for water reuse;
  • $1.7 billion for stormwater; and
  • $1.7 billion for combination projects.

At a glance, projects were given loans ranging between $16 million to $700 million, with 19 projects receiving loans under $100 million. The report adds that 78% of these loans are still under construction.

A full 2020 report can be viewed here.

A full list of WIFIA closed loans can also be viewed here.

Recent Loan Awards

In December, the EPA announced that it had invited 39 new projects to apply for WIFIA loans. The EPA anticipates that, as funding becomes available, $6.7 billion in WIFIA loans will help finance over $15 billion in water infrastructure projects across 24 states. The invited projects will also reportedly help modernize water infrastructure for 25 million Americans and create up to 49,000 jobs.

Projects selected by the EPA to apply look at impacts of extreme weather events, the climate crisis, cybersecurity, green infrastructure and water reuse. Approximately $1.2 billion in loans are available to support infrastructure in historically underserved communities.

In a goal to diversify the program, the EPA selected three small communities, with populations of 25,000 or less, for WIFIA loans totaling nearly $62 million. The EPA reports that entities in Connecticut, Delaware and Hawaii are invited to apply for the first time.

A full list of invited projects can be found here

In January, the EPA announced three WIFIA loans totaling $688 million to help advance water infrastructure projects.

“In my first year as EPA Administrator, I have visited communities from coast to coast. I’ve seen aging infrastructure that communities count on for clean and safe water. I’ve seen the harm that is caused when water systems fail, and I’ve seen the revitalization that comes with new investment,” said EPA Administrator Michael S. Regan. 

“Investing in water infrastructure strengthens the health of our communities while creating good paying jobs. This is a fundamental way that EPA is Building a Better America under President Biden’s leadership, and its why we’re so excited to put more than $50 billion to work in water infrastructure through the Bipartisan Infrastructure Law.”

In a speech to the U.S. Conference Mayors, Regan announced the three new WIFIA loans, awarded to:

  • City of Baltimore ($396 million): implement projects to improve the reliability and resiliency of its water systems, including by replacing water mains ahead of schedule, with the city saving approximately $100 million while project construction and operation are expected to create an estimated 2,700 jobs;
  • Union Sanitary District, California ($250 million): fund upgrades to aging water infrastructure to improve wastewater treatment, reduce nutrient discharges to the San Francisco Bay and increase resiliency to the impacts of climate change, with project construction and operation are expected to create 1,630 jobs; and
  • Milwaukee Metropolitan Sewerage District ($42 million):  expand its stormwater management capacity and reduce flood risk in historically underserved communities, with project construction and operation expected to create an estimated 130 jobs.

According to the EPA, the agency closed 29 WIFIA loans in the first year of the Biden-Harris Administration, investing over $5 billion nationwide to protect public health and the environment while creating over 36,000 jobs.

Under the bipartisan infrastructure law, the EPA will receive $50 billion to improve the country’s drinking water, wastewater and stormwater infrastructure, reportedly the largest investment in water ever made by the federal government. The Agency will also provide $7.4 billion in 2022 to the State Revolving Funds, with more over the next five years.

   

Tagged categories: Environmental Controls; Environmental Protection Agency (EPA); EPA; Funding; Government; Grants; Green Infrastructure; Infrastructure; Infrastructure; NA; North America; Program/Project Management; Upcoming projects; Wastewater Plants; Water/Wastewater

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