The City of Davis announced that that the State Water Resources Control Board (SWRCB) authorized a $95.5 Million State Revolving Fund (SRF) loan for Davis’ and UC Davis’ shares of the regional water project.
“Tens of millions in low interest financing are headed to Yolo County, thanks in large part to the efforts of local water suppliers seeking to minimize cost of service increases for their users,” said a city release.
The Woodland-Davis Clean Water Agency (WDCWA) and the City of Davis announced today that the State Water Resources Control Board (SWRCB) authorized a $95.5 Million State Revolving Fund (SRF) loan for Davis’ and UC Davis’ shares of the regional water project.
With a low 1.7 percent interest rate and 30-year term, the loan provides a savings of $36.5 million for the City of Davis when compared to conventional financing. Additionally, the City of Davis has a separately pending application for a $35 million SRF loan with similar terms to fund needed improvements to the city’s existing water distribution system.
With both loans, City of Davis ratepayers will save a total of $51.5 million in financing costs over the next 30 years, the city said.
“We are very pleased the SWRCB approved the loan for Davis’ share of the regional facilities,” said Dan Wolk, Davis Mayor and WDCWA Vice-Chair. “We’ve spent the past 18 months working on the complex application and terms, but it was well worth the intensive effort. We’re making good on our promise to minimize project costs and aggressively pursue outside funding and low-interest loans to reduce the impact on rates. These actions, along with UC Davis’ recent decision to join the project and share costs, will lower Davis’ costs and the pressure for future rate increases.”
The regional surface water project, also known as the Davis-Woodland Water Supply Project, is currently under construction. Slated for completion in late 2016, “the new facilities will address significant drinking water and wastewater quality problems in the communities of Woodland and Davis.”
The city release stated that, among its many benefits, it will:
- increase reliability and diversify water supplies in both communities and for UC Davis;
- facilitate compliance with current and future wastewater discharge requirements;
- improve treated wastewater effluent quality, thereby protecting and improving the condition of the Delta;
- protect groundwater from over pumping while still meeting the region’s agricultural needs;
- reduce fish mortality in the Sacramento River as a result of a new, state-of-the-art water;
- be a diversion facility that is being jointly built with RD2035; and
- provide thousands of construction-related jobs as well as long-term permanent employment for Water Treatment Plant operators and maintenance personnel.
“The water project is an exemplary model of a true regional partnership. With our project partners, we have been able to achieve very significant economies of scale in all facets of planning, design, construction and operations, ultimately reducing the long-term cost for water users,” said Bill Marble, Woodland Mayor Pro Tem and WDCWA Chair. “The importance of this partnership to ours and future generations cannot be overstated,” he added.
“Planning for the Davis-Woodland Project began in 1994 and has been a collaborative effort between Davis, Woodland, and UC Davis over the past 20 years,” said California Senator Lois Wolk. “The loan agreement with the State Water Resources Control Board is the next step toward completion of this project. This low interest loan will reduce the costs for ratepayers and ensure that their money is spent wisely. The project will provide high quality drinking water for residents, improve the ecosystem health of the Delta where the water ultimately ends up, and advances our statewide water policy goals.”
Earlier this year, the Agency received an SRF loan from the California Department of Public Health in the amount of $111million for the City of Woodland’s share of the regional water project. Woodland also received a separate $31.5 million SRF loan for local improvements to the Woodland water distribution system.
In total, SRF loans for both Woodland and Davis are projected to cover more than 98 percent of the regional water project costs. Both cities have now approved all rate increases necessary to proceed with their shares of the project. Officials from both cities emphasized the importance of developing regional partnerships and securing state and federal funding in their efforts to minimize increases to water rates.
“Water affordability is critical to the California economy, and also heavily impacts our State’s low and fixed-income residents,” said 4th District Assemblymember Mariko Yamada. “As communities face the rising costs of food, medicines, and education, I applaud today’s Board vote in support of a long-term, regional approach to keeping water rates down.”
–David M. Greenwald reporting