EPA seeking applicants for next round of WIFIA loans

The U.S. Environmental Protection Agency (EPA) is seeking applicants for up to $5.5 billion worth of loans and credit assistance through the Water Infrastructure Finance and Innovation Act (WIFIA) program. Community water systems and other prospective borrowers have until 12 p.m. EDT on July 6 to submit a letter of interest to the agency.

According to EPA’s formal Notice of Funding Availability, this round of funding will put a special focus on projects that reduce lead exposure and otherwise provide for clean and safe drinking water, as well as projects that repair, rehabilitate and replace aging infrastructure and conveyance systems. However, all types of projects eligible for WIFIA assistance will be considered.

To help potential borrowers navigate the process, EPA has updated the WIFIA program website to include resources such as application materials (including a new letter of interest form) and an updated WIFIA program handbook. The agency also plans to host several webinars during the letter of interest submittal period that will provide an overview of the WIFIA program and explain the process for submitting and evaluating letters of interest.

This latest round of loan funding was made possible by the FY18 omnibus appropriations bill that was recently signed into law by President Trump. That measure delivered $63 million for the WIFIA program, including $55 million that can be leveraged into loans and credit assistance.

RELATED: AWWA applauds doubling of WIFIA funding

EPA expects to leverage these funds at a 100-1 ratio, leading to $5.5 billion in available loan funds.  Because these loans may cover up to 49 percent of a project’s total cost, EPA forecasts the assistance could support approximately $11 billion in total water infrastructure investment.

Water groups such as the Association of Metropolitan Water Agencies (AMWA) and the American Water Works Association (AWWA) worked with members of Congress to create WIFIA in 2014, and AMWA is now supporting a proposal to reauthorize the program for an additional five years. EPA is currently in the process of evaluating the applications of 12 projects that sought a total of $2.3 billion worth of loans last year in WIFIA’s inaugural funding round.

Administered by EPA, WIFIA lowers the cost of large water infrastructure projects by providing low-interest, long-term federal loans to communities. The additional funding will allow EPA to solicit more letters of interest and loan applications from interested water utilities.

Modeled after the successful Transportation Infrastructure Finance and Innovation Act, WIFIA leverages federal dollars so that for every dollar Congress appropriates, 50 to 60 dollars are expected to be loaned out. With the United States facing a $2 trillion water and wastewater infrastructure challenge, many water utilities rely on low-interest loans to spur along critical water infrastructure projects.

Sources: AMWA, AWWA

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