EPA announces funding for water infrastructure loans

Local governments can apply for loans to improve their water infrastructure through a new round of $6.5 billion in funding recently announced by the U.S. Environmental Protection Agency.

Financing is available through the Water Infrastructure Finance and Innovation Act program and the State Infrastructure Financing Authority WIFIA program, with a focus on underserved and overburdened communities.

Established by the Water Infrastructure Finance and Innovation Act of 2014, the EPA’s federal loan and guarantee program aims to accelerate investment in the nation’s water infrastructure by providing long-term, low-cost supplemental loans for regionally and nationally significant projects.

“Water infrastructure provides the foundation for healthy and vibrant communities by delivering safe drinking water and returning our treated wastewater to the environment,” said Radhika Fox, the EPA’s assistant administrator for water, in a statement. “In too many communities, these essential pipes and pumps are decades old and need to be upgraded.”

For this funding round, the EPA has identified four priorities for project financing:
• Increasing investment in economically stressed communities
• Making rapid progress on lead service line replacement
• Addressing PFAS and emerging contaminants
• Supporting “one water” innovation and resilience

Prospective borrowers can begin submitting letters of interest to the EPA on Sept. 6. The EPA will continue accepting letters of interest until all of the available funds have been committed, though it recommends that letters of interest be sent early in the process.

Assistance can support a wide range of projects, including:
• Drinking water treatment and distribution projects
• Wastewater conveyance and treatment projects
• Nonpoint source pollution management program
• Management, reduction, treatment or recapture of stormwater
• National estuary program projects
• Enhanced energy efficiency projects at drinking water and wastewater facilities
• Desalination, aquifer recharge, alternative water supply, and water recycling projects
• Drought prevention, reduction, or mitigation projects

The EPA’s focus on underserved communities for this program aligns with the goals of President Joe Biden’s Justice40 initiative, which aims to have federal agencies deliver at least 40% of benefits from certain investments, including water and wastewater infrastructure, to underserved communities.

To date, the program has closed nearly 90 loans and provided more than $15 billion in credit assistance for water infrastructure projects. The loans closed include $250 million to the Springfield Water and Sewer Commission toward a $550 million water and wastewater upgrade project.

Through its Water and Wastewater Infrastructure Renewal Program, Springfield is increasing system reliability and ensuring safe drinking water by rehabilitating, replacing and upgrading the commission’s drinking water and wastewater treatment processes. According to the EPA, the federal financing will accelerate Springfield’s system updates by 15 years and will save the city an estimated $60 million in the process.

Visit the EPA website for more information.