WIFIA funding helps communities address the impacts of climate change

Changes in climate can have significant negative impacts on water infrastructure and utilities. To address the impacts of climate change, communities across the country are incorporating strategies supporting climate resiliency and mitigation into their water systems. Climate resiliency is a water system’s ability to maintain services despite climate-related stress and to be better prepared for future climate-related events. Climate mitigation refers to actions limiting the severity and rate of future climate change by reducing greenhouse gas emissions and advancing nature-based solutions. Examples of climate resiliency and mitigation activities undertaken by communities includes relocating treatment plants, incorporating renewable energy, conserving water supplies through water reuse, constructing stormwater infrastructure, and installing flood walls and backup generators.

The Water Infrastructure Finance and Innovation Act (WIFIA) program is one resource communities can use as they address climate change impacts. The WIFIA program is a government bank at the U.S. Environmental Protection Agency (EPA) that provides long-term, low-cost financing to borrowers for drinking water, wastewater and stormwater infrastructure projects. Since 2018, the WIFIA program has provided $20 billion in financing to support $44 billion in water infrastructure projects nationwide. Of this, more than $11 billion has helped communities increase resilience to climate-related events, like droughts and storms, and nearly $2 billion to reduce greenhouse gas emissions. The following examples of WIFIA-funded projects highlight the various ways communities across the country are utilizing WIFIA financing to further their climate resilience and mitigation efforts.

City of Fort Lauderdale’s seven neighborhood stormwater improvements project
The city of Fort Lauderdale, Fla., is vulnerable to the impacts of climate change, including sea-level rise and more frequent storm events. To address these challenges, Fort Lauderdale received a $120 million WIFIA loan to implement green and gray infrastructure to manage stormwater throughout the city’s most flood-prone neighborhoods. Fort Lauderdale estimates that 7,500 acre-feet per year of stormwater will be contained and diverted through this project. To lessen the impact on ratepayers, Fort Lauderdale deferred repayments for five years after project completion, allowing time to slowly adjust stormwater rates, as needed. By utilizing WIFIA financing, Fort Lauderdale will save an estimated $25 million over the life of the loan. This project will help Fort Lauderdale enhance climate resilience, upgrade stormwater infrastructure, and improve water quality.

Springfield Water and Sewer Commission’s infrastructure renewal program
The Springfield Water and Sewer Commission in Massachusetts received a $250 million WIFIA loan for their water and wastewater infrastructure renewal program. The commission is utilizing these funds to complete 30 projects that upgrade the drinking water and wastewater systems. Additionally, the commission will rehabilitate their hydropower facility, reducing need for fossil fuels and promoting energy efficiency. By securing WIFIA financing, the commission will save approximately $60 million and accelerate water infrastructure investments by 15 years.

Orange County Water District’s Groundwater Replenishment System final expansion project
In 2018, the Orange County Water District (OCWD) in California secured $135 million in WIFIA funding to expand its Groundwater Replenishment System (GWRS). This expansion increased the system’s capacity from 100 million gallons per day (MGD) to an additional 30 MGD. This project allowed the district to replenish the Orange County Groundwater Basin and reduce reliance on costly imported water supplies. With this final expansion, the GWRS now recycles all reclaimable wastewater from the Orange County Sanitation District, producing enough water to serve more than 1 million people. The district leveraged several advantageous WIFIA financing flexibilities, including placing the WIFIA loan on a subordinate lien at no additional cost, deferring repayments until five years after project completion, and completing a one-time interest rate reset. Initially, the 2018 loan was projected to save $16 million over its lifespan. Following the interest rate reset in 2020, the district anticipates additional savings of $75 million, substantially lowering costs for ratepayers.

About the WIFIA program
Like a bank, the WIFIA program has funding available on an ongoing basis, allowing prospective borrowers to request financing on their own schedule. When a prospective borrower is ready, they can submit a letter of interest to the WIFIA program to begin the financing process. Contact the WIFIA team today to learn more about WIFIA financing and how to submit a letter of interest. Visit the WIFIA program website and contact WIFIA staff directly at [email protected].

Dallas Shattuck is a senior program manager for the U.S. Environmental Protection Agency’s WIFIA program, where she focuses on program processes, policy, and stakeholder outreach and engagement.