WIFIA Credit Assistance Letters of Interest Due April 10
The U.S. Environmental Protection Agency (USEPA) is accepting letters of interest (LOI) through midnight April 10, 2017 for credit assistance under the new Water Infrastructure Finance and Innovation Act (WIFIA) program. The WIFIA program will provide long-term, low-cost credit assistance in the form of direct loans and loan guarantees to creditworthy water and wastewater projects.
USEPA will collect LOI in two selection rounds in FY 2017. The second LOI submittal period, if needed, will begin on August 1, 2017 and end at midnight in the time zone of the prospective borrower on September 29, 2017.
Prospective borrowers must submit all LOI electronically via email at: email@example.com. USEPA says prospective borrowers will receive a confirmation email and are advised to request a return receipt to confirm transmission. Prospective borrowers can access additional information, including the WIFIA program handbook and application materials, on the WIFIA website.
WIFIA provides another option for financing large infrastructure projects in addition to the State Revolving Funds (SRF) and bond market. USEPA estimates that funds appropriated to the WIFIA program can be leveraged at a ratio up to 60 to one, which means the $17 million program budget could allow USEPA to make more than $1 billion in loans and stimulate about $2 billion in total infrastructure investment.
The U.S. Environmental Protection Agency outlines WIFIA eligibility requirements on its website.
-Federal, state or local government entities
-Partnerships and joint ventures
-Corporations and trusts
-Tribal governments or consortium of tribal governments
-State Clean Water and Drinking Water SRF programs
-Wastewater conveyance and treatment projects that are eligible for the Clean Water SRF
-Drinking water treatment and distribution projects that are eligible for the Drinking Water SRF
-Enhanced energy efficiency at drinking water and wastewater facilities
-Brackish or seawater desalination, aquifer recharge, and water recycling projects
-Acquisition of property if it is integral to the project or will mitigate the environmental impact of a project
-Bundled SRF projects submitted under one application by an SRF program
-A combination of projects secured by a common security pledge
-Development phase activities, including planning, preliminary engineering, design, environmental review, revenue forecasting, and other pre-construction activities.
-Construction, reconstruction, rehabilitation, and replacement activities.
-Acquisition of real property or an interest in real property, environmental mitigation, construction contingencies, and acquisition of equipment.
-Capitalized interest necessary to meet market requirements, reasonably required reserve funds, capital issuance expenses and other carrying costs during construction.
Important Program Features
-Projects must cost at least $20 million for large communities and $5 million for small communities (population of 25,000 or less).
-WIFIA assistance may not exceed 49% of a project’s eligible costs.
-Total federal assistance may not exceed 80% of a project’s eligible costs.
-The interest rate on the loan will not be less than the yield on U.S. Treasury securities of a similar maturity at the date of closing.
-Loans may have a repayment schedule of up to 35 years or the useful life of the project, whichever is shorter. There is no repayment obligation until five years after substantial completion of the project.
-The project must have a dedicated source of revenue and be deemed creditworthy. The senior obligation of the project must receive an investment grade rating. A preliminary rating opinion letter is required at the time of application, and two final rating opinion letters are required prior to closing.
-NEPA, Davis-Bacon, American Iron and Steel, and all other federal cross-cutter provisions apply.