Apr 15th 2016 | Posted in Water by Peter Partheymuller

Board selects 28 water projects for SWIFT priority list from 40 submissions

In the first 15 years of the 21st century, the Texas Water Development Board (TWDB) authorized funding of about $2.5 billion for projects in the State Water Plan. In 2015 alone, the TWDB committed to $3.8 billion of State Water Plan projects, according to Jeff Walker (pictured), the deputy executive administrator for water supply and infrastructure.

The difference? The State Water Implementation Fund for Texas (SWIFT).

Big SWIFT LogoThe SWIFT program was created by the legislature in 2013 and approved by voters that same year. In 2015, local governments and water districts submitted 48 abridged applications seeking $5.5 billion in funding. TWDB staff recommended 39 of those projects, representing about $4.1 billion, be moved onto the next phase of the application process. Ultimately, about $3.8 in project funding was approved.

At this week’s TWDB board meeting, Walker presented to the board members staff recommendations for this year’s prioritization list. Forty short applications were submitted between Dec. 5, 2015, and Feb. 5, requesting $2.34 billion. The SWIFT priority list includes 28 projects representing $1.317 billion.

The entities that made the SWIFT priority list now have until May 11 to submit full applications for SWIFT funding, after which TWDB staffers will review them before selecting the projects that are deemed eligible for funding by July. Bonds will be sold in October, and the funding dispersed in December. “At which point, we’ll take a deep breath and get ready for the 2017 round of funding,” Walker said.

jeff_walkerOf the dozen projects that didn’t make the SWIFT priority list, the TWDB’s presentation stated that several entities withdrew their applications for one reason or another and six were deemed ineligible because the projects do not make use of “recommended water management strategies in the regional and state water plans,” as mandated by the SWIFT program.

Kimberly Leggett, a spokeswoman for the water board, explained that the TWDB tried to make the SWIFT program similar to other TWDB funding programs “to minimize additional new paperwork or requirements and to keep the process similar to what entities were already familiar with.” Still, there were a few applications that didn’t meet the parameters of the SWIFT regulations. Those projects are eligible for other funding mechanisms, however, and the entities were given advice on which of those their projects better fit.

“Since SWIFT is a relatively new program, there are going to be misunderstandings. But, generally, it seems that potential applicants are becoming more familiar with the program and its requirements,” she said.

The applications that will now be able to be submitted for full review include a wide variety of water projects. The largest amounts requested were by the city of El Paso, which asked for $150 million in funding for a groundwater importation project, and the city of Pearland, which requested $145 million that would go toward a surface water treatment plant. On the other end of the spectrum, the Upper Guadalupe River Authority requested $250,000 for a project to build off-channel surface water storage.

The funding provided by the SWIFT program comes primarily in the form of low-interest loans; 86 percent of the requested amount was for low-interest loans. Loan terms range up to 30 years, and entities receive a 35 percent interest rate subsidy on 20-year loans, 30 percent on 25-year loans and 25 percent on the 30-year loans. An entity can also request the TWDB to participate in a project, wherein the board would own the project on a temporary basis and be repaid through long-term, fixed-rate structured financing. The El Paso groundwater importation project, for instance, requested this funding mechanism.

Many government contracting opportunities will emerge from the SWIFT program. Learn more about them from SPI’s team of procurement consultants.