Agenda Item #13.7
For Council Meeting of: September 15, 2026
CITY OF SANTA ROSA
CITY COUNCIL
TO: MAYOR AND CITY COUNCIL
FROM: JENNIFER BURKE, DIRECTOR, SANTA ROSA WATER
SUBJECT: CLEAN WATER STATE REVOLVING FUND APPLICATION AND WATER INFRASTRUCTURE FINANCE AND INNOVATION ACT LETTER OF INTEREST AND LOAN APPLICATION FOR THE FULTON ROAD SEWER LIFT STATION RELOCATION PROJECT AGENDA ACTION: RESOLUTION
RECOMMENDATION
Santa Rosa Water recommends that the Council adopt three resolutions: 1) authorizing the submission of a Letter of Interest and loan application to the U.S. Environmental Protection Agency for Water Infrastructure Finance and Innovation Act financing; 2) authorizing the submission of a Financial Assistance Application to the State Water Resources Control Board for Clean Water State Revolving Fund financing and designating authorized representatives; and 3) declaring the City’s intent to reimburse eligible Project expenditures from Clean Water State Revolving Fund financing proceeds. The resolutions would also authorize the City Manager or designee to represent the City in connection with the proposed financing, subject to the terms and limitations stated in each resolution. This action requests appropriation of one-time Clean Water State Revolving Fund financing and Water Infrastructure Finance and Innovation Act financing.
EXECUTIVE SUMMARY
Santa Rosa Water is seeking authorization to apply for up to $17,850,000 in Clean Water State Revolving Fund financing from the State Water Resources Control Board and up to $17,150,000 in Water Infrastructure Finance and Innovation Act financing from the U.S. Environmental Protection Agency for the Fulton Road Sewer Lift Station Relocation Project. Together, the proposed loans would provide up to $35,000,000 in low-cost financing for eligible Project costs. The recommended action also includes a resolution declaring the City’s intent to reimburse eligible Project expenditures from future CWSRF financing proceeds.
GOAL
This item relates to Council Goal #1 - Achieve and Maintain Budgeting Excellence and Fiscal Stability by pursuing low-cost financing for critical wastewater infrastructure and supporting the long-term financial sustainability of the Local Wastewater Fund.
BACKGROUND/PRIOR COUNCIL REVIEW
The Clean Water State Revolving Fund (CWSRF) was established through the 1987 amendments to the federal Clean Water Act as a source of low-interest financing for eligible water-quality infrastructure projects. In California, the CWSRF program is administered by the State Water Resources Control Board and provides long-term, below-market-rate financing for the planning, design, and construction of wastewater collection and treatment facilities.
Federal and state contributions capitalize state CWSRF programs. Loan repayments are returned to the fund and used to finance additional water-quality and public-health infrastructure projects.
Established in 2014, the Water Infrastructure Finance and Innovation Act (WIFIA) program is a federal credit program administered by the U.S. Environmental Protection Agency. WIFIA provides long-term, low-cost financing for eligible water and wastewater infrastructure projects. A WIFIA loan generally may finance up to 49 percent of eligible project costs and may be combined with other financing sources, including State Revolving Fund assistance.
The Fulton Road Sewer Lift Station Relocation Project will abandon the existing Sewer Lift Station at Fulton Road and West College Avenue and construct a replacement facility on City-owned property located approximately 600 feet to the west. The Project will improve pumping efficiency by approximately 30 percent, increasing pumping capacity and overall system performance. These improvements will significantly reduce the risk of sanitary sewer overflows, unplanned outages, and emergency repairs, decreasing maintenance costs and enhancing long-term reliability and resilience.
With an anticipated Project cost of $35,000,000, Santa Rosa Water is seeking a $17,150,000 WIFIA loan and a $17,850,000 CWSRF loan to be paid back over a 30-year period.
ANALYSIS
The Fulton Road Sewer Lift Station has reached the end of its useful service life and needs to be relocated and rebuilt. This Project will improve system reliability and resilience and reduce vulnerability to service disruptions. The Project will improve the responsiveness of this critical wastewater facility during extreme events, including wildfires, power disruptions, and intense storm events, ensuring continued protection of public health and water quality.
The City Manager, in coordination with Santa Rosa Water is submitting a CWSRF Application to the Water Board and a letter of interest and application for a WIFIA loan to the EPA to provide funding for the Fulton Road Sewer Lift Station Relocation Project.
The WIFIA program offers flexible debt financing that will minimize the burden on cash funding. Loan repayments can be deferred for up to five years after Project completion and can be customized to match anticipated revenue for up to 35 years after Project completion.
The CWSRF program generally offers financing terms of up to 30 years or the useful life of the Project, whichever is shorter, with an interest rate equal to one-half of the State’s most recent general obligation bond rate.
Applicable interest rates and final repayment terms will be established through the respective program-approval and loan-closing processes.
FISCAL IMPACT
If approved, the proposed WIFIA and CWSRF loans would provide up to $35,000,000 to finance eligible Project costs. The City would be responsible for repayment of principal and interest in accordance with the final financing agreements. Debt-service payments are anticipated to be funded by the Local Wastewater Fund and will be included in future budget requests. Approval of the recommended action does not appropriate the financing proceeds and would have no impact on the General Fund.
ENVIRONMENTAL IMPACT
On November 1, 2018, the Board of Public Utilities adopted a Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program and approved the Fulton Road Sewer Lift Station Relocation Project. The recommended action concerns applications for financing for the previously approved Project and does not modify the Project’s physical scope or authorize any physical activity beyond that previously reviewed and approved. Staff has determined that no substantial changes to the Project, substantial changes in circumstances, or new information of substantial importance require additional environmental review pursuant to CEQA Guidelines Section 15162. Accordingly, the previously adopted Mitigated Negative Declaration remains applicable, and no further environmental review is required.
BOARD/COMMISSION/COMMITTEE REVIEW AND RECOMMENDATIONS
On November 1, 2018, the Board of Public Utilities: (1) adopted the Mitigated Negative Declaration; (2) approved the Project; (3) adopted the Mitigation Monitoring and Reporting Program; (4) directed staff to file a Notice of Determination; and (5) approved the acquisition of 1225 Fulton Road, Santa Rosa.
On March 6, 2025, the Board of Public Utilities approved Project Work Order No. A010135-2016-36 under the Master Professional Services Agreement with Brelje & Race Consulting Engineers of Santa Rosa, California, to provide professional engineering design services.
On August 20, 2026, the Board of Public Utilities approved recommending that the City Council authorize the submission of a Financial Assistance Application to the State Water Resources Control Board for Clean Water State Revolving Fund financing and a Letter of Interest and loan application to the U.S. Environmental Protection Agency for Water Infrastructure Finance and Innovation Act financing; and authorize the City Manager or designee to represent the City in connection with the financing agreements, including taking all actions necessary to execute and administer the agreements and any amendments thereto.
NOTIFICATION
Not applicable.
ATTACHMENTS
Resolution 1 – WIFIA
Resolution 2 – CWSRF Reimbursement
Resolution 3 – CWSRF Authorizing
PRESENTER
Katie Robinson, Administrative Analyst
CLEAN WATER STATE REVOLVING FUND APPLICATION AND WATER INFRASTRUCTURE FINANCE AND INNOVATION ACT LETTER OF INTEREST AND LOAN APPLICATION FOR THE FULTON ROAD SEWER LIFT STATION RELOCATION PROJECT PAGE 3 OF 3