WIFIA passes and redefines water infrastructure funding  

JULY 2014 — The Water Resources Reform and Development Act (WRRDA) was recently signed by President Obama. Included in the new legislation was a five-year pilot program for the Water Infrastructure Finance and Innovation Act (WIFIA).

The new policy of WIFIA, administered by the EPA under WRRDA, will offer low-interest loans and loan guarantees to public-sector entities for water infrastructure projects. This is a crucial step in funding repairs or rehabilitations to revive the nation’s aging water and wastewater facilities and systems without the need for State Revolving Funds.

Eligible projects must cost at least $20 million, or $5 million for communities serving no more than 25,000. Additional terms to the policy require loans to be repaid within 35 years and limits WIFIA support of a project to 49% of the project cost. This encompasses a general limit of 80% for all federal assistance in any project and entails that tax-exempt debt not be used to pay the non-federal share of the project cost.

The American Water Works Association (AWWA) has been an integral player in paving the way for WIFIA throughout the entire legislative process. Currently, AWWA is encouraging House and Senate support to amend the policy and lift the 49% project cost limit, in addition to allowing the use of tax-exempt bonds. While not all terms sought out by AWWA were initially implemented, this pilot program will significantly change our nation’s water infrastructure needs in the coming years.

More information on WIFIA and its impending impact are highlighted here.