Agency Financing $13 Billion in Water Infrastructure Nationwide
On Oct. 1, the U.S. Environmental Protection Agency announced an $88 million loan to the Soquel Creek Water District for an innovative water reuse project to produce safe drinking water by purifying recycled water.
“Monterey Bay plays a vital role in the region’s marine health and biodiversity,” said EPA Pacific Southwest Regional Administrator John Busterud. “EPA’s financial support to the Soquel Creek Water District will help protect the Bay while replenishing local groundwater and ensuring that the community is more resilient against drought.”
The EPA said the project will use advanced technology to purify recycled water, producing 1.3 million gallons per day of safe, high-quality water and providing a reliable, sustainable and drought-resistant water supply that meets current and future demands. The technology involves reverse osmosis, microfiltration, and ultraviolet light/advanced oxidation.
The low-interest loan comes from the 2014 Water Infrastructure Finance and Innovation Act, which aimed to accelerate investment in the nation’s water infrastructure.
Since March, EPA has announced 15 WIFIA loans and updated four existing loans with lower interest rates, which the agency said would save ratepayers $1 billion compared to market financing.
EPA expects this loan will save Soquel Creek Water District an estimated $66.7 million compared to market financing while project construction and operation are expected to create an estimated 581 jobs.
“With 40 states anticipating some freshwater shortages within their borders in the next 10 years, projects like Pure Water Soquel Creek are taking the challenge of meeting 21st century water demands,” said David Ross, EPA assistant administrator for water. “EPA is able to support innovative water infrastructure to help diversify water supplies and protect groundwater while saving ratepayers money.”
In February, EPA Administrator Andrew Wheeler announced the National Water Reuse Action Plan, which identifies 37 actions led by a spectrum of federal, state, local and other water sector interests. Over the coming months, EPA will seek input from stakeholders to help inform the next iteration of the action plan, slated for release in spring 2021.
The cost estimate for the Pure Water Soquel project has not been finalized but the water district plans to use its own funds, a Proposition 1 Groundwater grant and a Seawater Intrusion Control loan from the state of California.
“I want to congratulate the Soquel Creek Water District for this significant milestone in the history of the Pure Water Soquel project,” said U.S. Representative Jimmy Panetta (D-Carmel Valley). “Seawater intrusion into critical groundwater supplies is of great concern throughout my coastal district, and with this low-interest loan, the district can begin the next phase project, helping ensure the long-term protection of our local water supply.”
“This very low-interest loan from WIFIA is a real landmark in Soquel Creek Water District’s efforts to address our critical water supply issues,” said Assembly Member Mark Stone (D-Scotts Valley). “We are so fortunate here in Santa Cruz County to benefit from this extraordinary level of support and funding from the U.S. EPA, as well as from our own State Water Board, which is making the difference in assuring long-term sustainability of the community’s drinking water supply.”
“Maintaining a clean, reliable supply of drinking water is clearly one of the most vital issues here and throughout California,” said Santa Cruz County Supervisor Zach Friend, who represents Soquel, Aptos and Capitola. “With the help of this generous WIFIA loan from the U.S. EPA, the Soquel Creek Water District is poised to take a giant leap forward toward local water supply sustainability, by creating a new source of pure water, replenishing the groundwater, and preventing further seawater contamination.”
“We’re grateful to the EPA for this WIFIA loan, which will help the District in our roles as both our community’s water supplier and environmental steward,” said Dr. Bruce Daniels, president of the Soquel Creek Water District board of directors. “Assuring the sustainability of our groundwater supply is paramount. With this loan, we’re able to accomplish that, while reducing the burden on our rate payers and providing a drought-proof water supply for today and future generations.”
“This low-interest loan represents a valuable partnership and investment among the District, the EPA and our local rate payers in support of our Pure Water Soquel Project,” said Ron Duncan, Soquel Creek Water District general manager. “The project will replenish and protect the groundwater — our sole source of drinking water — from being further contaminated by saltwater intrusion, which is already detected in multiple locations. Thanks to the EPA and this WIFIA loan, we’re on track to implement Pure Water Soquel.”
WIFIA is providing financial support at a critical time as the federal government, EPA, and the water sector work together to help mitigate the public health and financial impacts of COVID-19.
Since the first WIFIA loan closed in April 2018, EPA has now issued 31 such loans totaling $6 billion to help finance $13 billion for water infrastructure projects while creating 28,000 jobs and saving ratepayers $2.7 billion.
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For information about the selection process, visit: https://www.epa.gov/wifia/wifia-funding-currently-available.