The city of Columbia, Tenn., will receive a $272 million federal loan to expand its drinking water system as population and economic growth increase demand in the region.
The U.S. Environmental Protection Agency (EPA) announced the Water Infrastructure Finance and Innovation Act (WIFIA) loan for Columbia’s Long-Term Water Supply Program. The financing will support a new raw water intake, transmission infrastructure and improvements to the city’s existing water treatment system.
EPA records show the loan closed Sept. 24.
The project is intended to increase the amount of drinking water available to Columbia and surrounding communities while improving the reliability of the regional water system.
Columbia Power & Water Systems (CPWS) operates the city’s water system. Its long-term water supply initiative includes a new intake on the Duck River, as well as expanded treatment capacity and other system improvements.
Earlier federal environmental documents describe the program as encompassing water supply, treatment and distribution improvements involving the CPWS system and major wholesale customers. The project is designed to meet increasing water demand while improving drought resilience.
CPWS has said its new water infrastructure will provide greater redundancy and move its primary raw water intake to a new location on the Duck River.
The federal loan is one component of a broader financing strategy for the water improvements.
In May, Columbia considered accepting a separate $75 million Drinking Water State Revolving Fund loan for the second phase of its water treatment plant expansion. CPWS said that financing was among the funding sources contemplated for its overall long-term water supply strategy.
EPA said the WIFIA loan will allow Columbia to customize its repayment schedule, potentially reducing financing costs over the life of the project.
WIFIA financing can provide repayment periods of as long as 35 years after a project is substantially completed. Borrowers can also defer repayments for as long as five years after completion and structure payments around anticipated revenues and expenses.
Congress established the WIFIA program in 2014 to provide long-term federal financing for major drinking water, wastewater and stormwater infrastructure.
Since the program’s first loan closed in 2018, EPA has closed 157 loans totaling $24 billion. Those loans are helping finance about $53 billion in water infrastructure projects, which EPA estimates will support 177,000 jobs.
EPA says approximately $11 billion in WIFIA financing remains available for additional water infrastructure projects nationwide. The agency is also waiving certain application and credit-processing fees for communities with populations of 25,000 or fewer during fiscal years 2026 and 2027.
Photo by Pixabay from Pexels
For more of the latest from the expansive government marketplace, check Government Market News daily for new stories, insights and profiles from public sector professionals. Check out our national contracting newsletter here.
