$7.5 billion in Available Financing for Water Infrastructure Projects
According to the EPA, the U.S. Environmental Protection Agency announced the availability of $7.5 billion of Water Infrastructure Finance and Innovation Act (WIFIA) funding. The WIFIA program offers long-term loans to help communities implement critical water infrastructure projects, which protect public health, deliver environmental benefits, create over 60,000 good-paying jobs, protect waterways including drinking water sources, and support local economies, at a lower cost.
“Good infrastructure is the foundation for delivering clean, safe water to people across the country,” said EPA Administrator Michael S. Regan. “The Biden-Harris administration has prioritized water infrastructure investment with this $7.5 billion infrastructure funding through WIFIA, on top of the unprecedented $50 billion in funding the Biden-Harris Administration secured under the Bipartisan Infrastructure Law. With these resources, communities will keep building on progress to replace lead pipes, cut PFAS pollution, and protect people from climate change.”
The WIFIA program provides its borrowers with creative, affordable financing options. It can fund the planning, design, and construction of a wide range of water infrastructure projects and offers the ability to combine multiple projects into a single loan. By streamlining the funding process, communities can accelerate their infrastructure projects. The WIFIA program offers interest rate resets, debt structuring, and fast disbursements, benefits not traditionally offered with other financing sources. For example, borrowers may defer repayment for up to five years following construction completion, and then customize their repayment schedule through the 35-year loan term. This flexibility provides borrowers with immediate funding to implement projects while helping to keep rates more affordable.
This is the eighth round of funding available, and it includes $6.5 billion available through WIFIA and $1 billion available through the State Water Infrastructure Financing Authority, known as SWIFIA. EPA is accepting letters of interest for WIFIA and SWIFIA loans. To date, EPA’s WIFIA program has closed loans totaling more than $20 billion to help finance $44 billion in projects across the country. More than 100 borrowers nationwide are utilizing WIFIA loan to finance projects that benefit over 64 million Americans. Completed WIFIA-financed projects show positive health and environmental outcomes, as well as the advantages of financing with WIFIA loans. For example:
- Orange County Water District (California) customers have a more drought-proof drinking water supply and are less reliant on imported water due to the completion of the Groundwater Replenishment System Expansion project. When interest rates lowered in 2020, the district was able to lower its interest rate, saving it an additional $75 million in financing costs.
- City of Wichita (Kansas) residents benefit from more reliable drinking water because of its new Northwest Water Treatment Facility. Due to WIFIA financing, the project was initiated seven years sooner than originally planned and now delivers clean drinking water to the community.
- City of Tacoma Sewer Utility (Washington) customers have a more reliable, resilient wastewater treatment system because of the completion of the Electrical Distribution System Replacement Project, which modernized the treatment plant’s electrical system. By deferring WIFIA loan repayment for four years after construction completion, the city can pay off existing state-revolving fund (SRF) loans prior to repaying their WIFIA loan.
The funding announcement demonstrates EPA’s continued commitment to water infrastructure improvements that ensure all communities have access to clean and safe drinking water. For this round of funding, EPA has identified the following priority areas:
- Increasing investment in disadvantaged communities and improving health and livability.
- Making rapid progress on lead service line replacement.
- Addressing PFAS – known as “forever chemicals” – and emerging contaminants.
- Strengthening climate resilience in the water sector.
- Supporting water innovation and resilience.
Learn more about the WIFIA program and this funding announcement.
Background
Established by the Water Infrastructure Finance and Innovation Act of 2014, the WIFIA program is a federal loan program administered by the EPA. The WIFIA program aims to accelerate investment in the nation’s water infrastructure by providing long-term, low-cost supplemental credit assistance for regionally and nationally significant projects. The WIFIA program has an active pipeline of pending applications for projects that will result in billions of dollars in water infrastructure investment and thousands of jobs. EPA accepts requests for WIFIA financing on an ongoing basis. Learn more about submitting a letter of interest for a WIFIA loan.
The WIFIA program also advances the Biden-Harris Administration’s Justice40 Initiative, which set a goal that 40% of the overall benefits of certain federal investments in climate, clean energy, the development of critical clean water and wastewater infrastructure, and other areas flow to disadvantaged communities that are marginalized by underinvestment and overburdened by pollution. Learn more about submitting a letter of interest for a WIFIA loan.
In addition to WIFIA loans, President Biden’s Bipartisan Infrastructure Law made a once-in-a-generation investment in the nation’s water infrastructure and made many types of federal funding resources available for communities and utilities to improve vital water and wastewater resources.
