FPU wins $5.27M in low-interest rehab loans
Fayetteville Public Utilities (FPU) has been awarded over $5.2 million in low-interest loans to improve the wastewater system here.
Tennessee Gov. Bill Haslam and Department of Environment and Conservation Commissioner Bob Martineau made the announcement last week that Fayetteville was among four communities approved to receive more than $15 million in low-interest loans for water and wastewater infrastructure improvements.
The City of Fayetteville will receive $4.3 million for a project that includes infiltration inflow corrections for sewer rehabilitation at the Liberty, Pitts, Tanyard Branch, Winchester Highway and Laten Bottom facilities, in addition to other system-wide efforts. The project will be funded with a 20-year, $3.87 million loan with an interest rate of 1.17 percent and $430,000 in principal forgiveness that will not have to be repaid.
Additionally, the City of Fayetteville will receive $972,360 for a project that includes infiltration inflow corrections at the Tanyard Branch, Laten Bottom and Winchester Highway interceptors and system-wide, including storm water cross-connection elimination. The project will be funded with a 20-year, $732,187 loan with an interest rate of 1.17 percent and $240,173 in principal forgiveness that will not have to be repaid.
“We are pleased to be in a position to help address critical drinking water and wastewater infrastructure needs at the local level, making improvements that will benefit the health of these communities and economic growth,” Haslam said in making the announcement.
The State Revolving Fund (SRF) Loan Program provides low-interest loans that help communities, utility districts, and water and wastewater authorities finance projects that protect Tennessee’s ground and surface waters and public health. Loans are used to finance the planning, design and construction of water and wastewater facilities.
The Department of Environment and Conservation administers the SRF Loan Program for the state of Tennessee in conjunction with the Tennessee Local Development Authority. The U.S. Environmental Protection Agency provides grants to fund the program, and the state provides a 20 percent match. Loan repayments are returned to the program and are used to fund future SRF loans.
Through the SRF Program, communities, utility districts, and water and wastewater authorities can obtain loans with lower interest rates than most can obtain through private financing. Interest rates for loans can vary from zero percent to market rate based on each community’s economic index. Loans utilizing the 2010 EPA grant funds include more than 20 percent principal forgiveness for water and wastewater projects, 2011 EPA grant funds include 30 percent principal forgiveness for water and 10 percent principal forgiveness for wastewater projects, and 2012 EPA grant funds include 20 percent principal forgiveness for water and wastewater projects.
“The State Revolving Fund loan program is an important tool that assists in much needed infrastructure improvements, while keeping local communities moving forward as they prepare for future needs,” Martineau said.
The funding order of projects is determined by the SRF Loan Program’s Priority Ranking Lists that rank potential projects according to the severity of their pollution and/or compliance problems or for the protection of public health.
“We are fortunate to receive the SRFL funding,” said Britt Dye, general manager and CEO for Fayetteville Public Utilities. “We have applied for these funds since 2009. Projects financed by this funding will improve the wastewater infrastructure of our system.
“I would like to thank the FPU Board of Directors for being aggressive in obtaining this funding,” Dye added. “I would also like to thank Mayor John Ed Underwood and the Board of Aldermen for supporting this effort. Thanks to Governor Bill Haslam, Department of Environment and Conservation Commissioner Bob Martineau, Representative Pat Marsh and Senator Jim Tracy for their assistance in obtaining approval of this funding.
“Completion of these projects will improve the quality of life and allow for additional growth in our community.”
FPU has focused on major improvements in its sewer infrastructure over the past few years, receiving welcome news last summer that a six-year sewer connection moratorium had been lifted, thanks to those continued improvements.
Since its inception in 1987, Tennessee’s Clean Water State Revolving Fund Loan Program has awarded more than $1.27 billion in low-interest loans. Since its inception in 1996, Tennessee’s Drinking Water State Revolving Fund Loan Program has awarded more than $207 million in low-interest loans. Both programs combined award more than $80 million annually to Tennessee’s local governments for water and wastewater infrastructure projects.