EPA Announces $128M WIFIA Loan To Improve Drinking Water Reliability In Drought-Prone Santa Cruz, California

This loan is part of a $37B investment in water infrastructure through WIFIA

Today, in conjunction with Infrastructure Week, the U.S. Environmental Protection Agency (EPA) announced a $128M Water Infrastructure Finance and Innovation Act (WIFIA) loan to the City of Santa Cruz, California to upgrade their drinking water system to be more resilient to drought and climate change. With this WIFIA loan, EPA is helping the City of Santa Cruz protect its water supply and deliver safe, reliable drinking water to nearly 100,000 residents.

“Western cities like Santa Cruz know how finite a resource water can be and must manage accordingly to deliver safe, reliable drinking water to residents, and the Biden-Harris Administration is committed to investing in water infrastructure through existing programs like WIFIA and the historic Bipartisan Infrastructure Law,” said EPA Assistant Administrator for Water Radhika Fox. “With this WIFIA funding, the City of Santa Cruz is modernizing their drinking water treatment facility to be resilient to both drought and extreme rain impacts that the city has faced over the last few years.”

Located in a drought-prone region, the City of Santa Cruz is wholly dependent on local water supplies. With this WIFIA loan, the city will modernize critical facilities by converting existing groundwater wells into aquifer storage and recovery wells and updating its raw water conveyance pipeline. Ultimately, the city will be able maximize the use of all water sources in response to climate impacts. The project will also support treatment process upgrades to address current and emerging contaminants, as well as source water quality variability.

“The WIFIA loan from the EPA allows Santa Cruz to make critical investments in securing our community’s water future, while saving our ratepayers substantial costs,” said Rosemary Menard, Santa Cruz Water Director. “We’re grateful for the opportunity the WIFIA loan provides to respond to the increasing challenges to water supply reliability posed by climate change.”

By financing with the low interest rate of a WIFIA loan, the City of Santa Cruz will save approximately $18M. The Construction and operations for the project are estimated to create over 1,000 jobs.

Background
Established by the Water Infrastructure Finance and Innovation Act of 2014, the WIFIA program is a federal loan program administered by EPA. The WIFIA program’s aim is to accelerate investment in the nation’s water infrastructure by providing long-term, low-cost supplemental credit assistance for regionally and nationally significant projects. The WIFIA program has an active pipeline of pending applications for projects that will result in billions of dollars in water infrastructure investment and thousands of jobs.

EPA is currently accepting letters of interest for WIFIA and SWIFIA loans. Learn more about submitting a letter of interest for a WIFIA or SWIFIA loan.

In addition to WIFIA loans, there are many federal funding resources available for communities and utilities to improve vital water and wastewater resources. This week marks Infrastructure Week and 18 months since President Biden signed the Bipartisan Infrastructure Law – a once-in-a-generation investment in our nation’s infrastructure and competitiveness. The Bipartisan Infrastructure Law provides a historic $50B investment in upgrading critical water, wastewater, and stormwater infrastructure.

Learn more about the WIFIA program and other water infrastructure investments.