On April 19, the U.S. Environmental Protection Agency issued its first-ever loan from the Water Infrastructure Finance and Innovation Act (WIFIA) for $134.5 million to the King County Wastewater Treatment Division to help finance the Georgetown Wet Weather Treatment Station.
Organizations have to be invited to submit an application, and the deadline is tight. Dan Kaplan, WTD financial services administrator, devoted one year to the pursuit of the low-interest loan, which will save ratepayers $32 million in interest payments over the life of the loan.
Dan had to first analyze and determine this was a good source of funding for WTD, and then had the tough task of convincing the EPA that the project was what they were looking for – that we could deliver it on time, and that we were able to engage in the challenging application process.
The WIFIA program supports spending on water and wastewater infrastructure. The Georgetown Wet Weather Treatment Station is designed to significantly reduce the amount of untreated wastewater and stormwater entering the Duwamish River, and will create approximately 1,400 direct and indirect jobs.
Of 44 national projects, only 12 were selected to proceed to the application stage.
It took three months to complete the application package, which required legal, engineering, and financial information from attorneys, project managers, permitting managers and finance staff. The process involved producing 32 pages of narrative, 70 exhibits, a preliminary rating letter from bond rating agencies, and a two-hour video conference presentation.
As this was the first loan ever awarded from the WIFIA program, the draft loan agreement included more than 100 pages of technical and legal requirements, which were reviewed in detail. Then the final loan language was negotiated. Dan managed a team of experts, including bond counsel, bond advisor, debt manager, prosecuting attorneys and project managers in developing an agreement that will provide the template for similar loans in the future.
For more information on the project, visit the Georgetown Wet Weather Treatment Station site.