New Year – New Funding Tool!
Willamette Water Supply Program leaders have long worked with state and federal government to broaden water infrastructure financing options, which will lessen the economic impact of infrastructure improvements on ratepayers. This advocacy helped pass the 2013 Water Infrastructure Finance and Innovation Act (WIFIA), a federal program designed to help drinking water, stormwater and wastewater utilities finance infrastructure new projects.
The new WIFIA is a significant improvement on previous legislation. The 2013 version of WIFIA allowed water utilities to use low-cost funding through state revolving loan funds, but it had a significant downside. Those who used WIFIA funds were banned from using tax-exempt bonds in combination with WIFIA loans. Because WIFIA loans could only finance up to 49 percent of the project’s total cost, the ban on municipal bond debt significantly discouraged the use of WIFIA funds.
Over the past year, the leadership of the America Water Works Association, TVWD and the City of Hillsboro worked with Oregon’s federal delegation to make WIFIA a better tool for local governments.
On December 3, 2015, Congress passed a five-year transportation bill, which also included the critical fix to WIFIA. The bill removed the ban on using tax-exempt bonds with WIFIA loans, allowing communities to pay for projects using a combination of WIFIA loans and tax-exempt municipal bonds. This change will allow the Willamette Water Supply Program to use the most efficient financing tools available, saving ratepayers money.
A special thank you to Senator Jeff Merkley, who is the original author of this new program, and Senator Ron Wyden and Representatives Suzanne Bonamici and Kurt Schrader for their support.