Infrastructure Financing
AWWA began shining a light on the issue of investment—or, as it were, underinvestment—in critical water infrastructure. The Association published a report in 2012 called Buried No Longer: Confronting America’s Water Infrastructure Challenge. This report, free to download, determined that over a trillion dollars should be invested in buried water infrastructure between 2012 and 2035. AWWA members were not just talking about the problem, however. We had a viable approach to spur investment that Congress should act on now—the Water Infrastructure Financing Innovations Act (WIFIA). Download the WIFIA White Paper.
In January 2017, The U.S. Environmental Protection Agency (EPA) announced the availability of approximately $1 billion in credit assistance for water infrastructure projects under the new Water Infrastructure Finance and Innovation Act (WIFIA) program. The WIFIA program is a federal credit program administered by EPA for eligible water and wastewater infrastructure projects.
The WIFIA program can fund development and implementation activities for eligible projects:
- Drinking water treatment and distribution projects that are eligible for the Drinking Water SRF
- Drought prevention, reduction, or mitigation projects
- Enhanced energy efficiency projects at drinking water and wastewater facilities
- Brackish or seawater desalination, aquifer recharge, alternative water supply, and water recycling projects
- Acquisition of property if it is integral to the project or will mitigate the environmental impact of a project
- Wastewater conveyance and treatment projects that are eligible for the Clean Water SRF
- A combination of projects secured by a common security pledge or submitted under one application by an SRF program
Eligible borrowers are:
- Local, state, tribal, and federal government entities
- Partnerships and joint ventures
- Corporations and trusts
WIFIA application process is three phases:
Phase 1: Project Selection: EPA announces the amount of funding it will have available and solicits letters of interest from prospective borrowers. In the letter of interest, prospective borrowers demonstrate their projects eligibility, financial creditworthiness, engineering feasibility, and alignment with EPA’s policy priorities. Based on this information, EPA selects projects which it intends to fund and invites them to continue to the application process.
Phase 2: Project Approval: Each invitee submits an application for WIFIA credit assistance. Using this information, the WIFIA program conducts a detailed financial and engineering review of the project. Based on that review, the WIFIA program proposes terms and conditions for the project and negotiates them with the prospective borrower until they develop a mutually agreeable term sheet. The Administrator demonstrates project approval by executing the project’s term sheet.
Phase 3: Negotiation and Closing: Based on the term sheet, the WIFIA program finalizes the terms of credit assistance to a prospective borrower. At closing, the Administrator and the prospective borrower execute the credit agreement, which is the binding legal document that allows the borrower to receive WIFIA funds.
For more details please visit the EPA/WIFIA website here or sign up for the WIFIA information sessions.
The CA-NV Section, AWWA is documenting our members interest and participation in the WIFIA program by compiling copies of intent letters from the Phase 1 application process. To participate in this documentation, simply email a copy of your intent letter to info@ca-nv-awwa.org. We appreciate your participation with this project.