California City Receives $62 Million EPA Water Infrastructure Loan

March 11, 2020

California city receives $62 Million EPA Water Infrastructure Loan for wastewater treatment plant

The U.S. EPA announced a $62 million Water Infrastructure Finance and Innovation Act (WIFIA) loan to the City of Morro Bay, California to replace the City’s 63-year old wastewater treatment plant.

The plant will be replaced with a new treatment and water recycling facility and the improvements will reduce discharges into the ocean as well as increase water supply and flood resilience, according to the press release.

Morro Bay is the first small community nationwide to receive a WIFIA loan.

“This WIFIA loan will help improve water quality in Morro Bay, while using advanced water reuse technology to help provide an enduring source of water to the small community of Morro Bay,” said EPA Administrator Andrew Wheeler. “Through WIFIA, EPA is playing a key role in President Trump’s efforts to improve and upgrade our nation’s water infrastructure. With this loan closing, EPA has now issued 17 WIFIA loans totaling $3.7 billion in credit assistance to help finance $8.4 billion for water infrastructure projects while creating more than 16,000 jobs.”

The City of Morro Bay will replace its existing treatment plant to help supplement the city’s water supply, reduce reliance on imported water and improve groundwater quality with the addition of highly treated water, according to the EPA. The new facility will be moved inland to increase its resiliency and reduce the risk of flooding.

“Securing this low-interest federal funding is a sound financial decision for the City,” said Mayor John Headding. “Signing the agreements now means that we will lock in near-historic low interest rates and ensure maximum benefit for our ratepayers.”

This water reclamation project will cost $126 million. EPA’s WIFIA loan will finance nearly half of that figure, which is up to $62 million, and the California State Water Resources Control Board will finance approximately $64 million from its Clean Water State Revolving Fund Loan Fund. 

The WIFIA loan will save the City of Morro Bay an estimated $29 million and project construction and operation are expected to create 403 jobs, reported the EPA.

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