Last month, Texas voters approved a plan that will authorize $2 billion in state funding to finance 50 years of water infrastructure projects. The money will come via a transfer from the state?s Rainy Day Fund, which is flush as a result of oil and gas revenue.
Rather than provide funding to new water projects, the $2 billion will be used to offer favorable financing terms for public agencies pursuing projects designed to conserve or reuse water, or create new taps of reservoirs designed to expand the water supply. The money will be paid back as part of a revolving loan fund.
?Today, the people of Texas made history, ensuring we?ll have the water we need to grow and thrive for the next five decades, without raising state taxes,? Texas Gov. Rick Perry said in a statement. ?Now it?s time to get to work on the projects that?ll help us meet our growing water needs, preserving and improving both our economic strength and quality of life.?
The move is the second time in two years Texas voters have voted to spend big money on water infrastructure. In 2011, they approved $6 billion in bonding authority for the state?s water board to help fund water projects.
The Texas Water Development Board will use the $2 billion to offer regional and local authorities the ability to do projects at lower interest rates, with longer payment periods or with payment deferrals, according to Merry Klonower, a spokeswoman for the Texas Water Development Board. ?Those types of financing packages are what incentivizes them to move forward with building their water supply projects,? Klonower said last month.
Failure to pursue projects outlined in the state?s 50-year water plan could mean that up to half the state would lack access to an adequate water supply during drought periods. Advocates for water infrastructure portrayed the situation as an economic development issue since businesses may think twice about expanding or moving to Texas given the uncertainty about water resources.
The favorable vote now triggers a timeline intended to ensure the projects start relatively quickly. State leaders will soon start appointing members to a water finance advisory committee, while the Texas Water Redevelopment Board will create a group tasked with prioritizing projects. The board must determine how the funds will be prioritized and how the funding will be allocated by March 2015.
Leave a Reply