Borrego Water District
Last updated 9/16/2021 at 9:32am
The Borrego Water District (BWD) Board and Staff are focused on replacing aging water and sewer infrastructure including water wells/pipelines and waste water collection/treatment. Engineers and Operations Staff ensure the design and construction of the project meets all legal, environmental and operational requirements. Just as important is having the funds in place to finance these critical projects.
The preferred choice of financing future project is Federal and State Grants. In 2019, BWD received $500,000 to complete the drilling of a pilot hole on a new well and various planning related documents associated with the Groundwater Sustainability Plan development. In 2021-22 BWD is scheduled to receive over $2 M for replacement of 3 water tanks and almost $800,000 for renovation of the waste water treatment plant.
In an effort to look for the next round of Grant funding opportunities, BWD has retained the services of Best, Best and Krieger (BBK) for lobbying/advocacy services. BBK maintains office in both Washington DC and Sacramento for this purpose and fortunately for BWD, opportunities exist at both the Federal and State level.
Federal legislation associated with infrastructure construction and state budget expenditures aimed at “drought relief” are under development and will likely lead to the next round of grant funding. A specific request has already been submitted for construction of a pipeline in Borrego Springs Road as part of the Federal appropriations process.
Upcoming State Drought funding will hopefully provide funding opportunities for both infrastructure replacement as well as water right acquisition. The specific grant requirements for both Federal and State programs have not yet been developed.
When grant funding is not available, BWD must use rate revenue and in 2018, BWD issued $5.5 M in bonds at 3.8% to finance construction to two new wells and replacement of water and sewer pipelines, fire hydrants and well head piping/electrical. BWD debt has a refinancing option on October 1, 2021 and as with a home mortgage, payments can be reduced if interest rates have dropped since 2018. BWD determined market conditions were right and solicited bids to refinance. One bid was received from Capital One at for a rate of 2.19% for 15 years. The net impact from 1.61% reduction in the interest rate (3.8% to 2.19%) creates a savings of over $560,000 over the life of the new loan in reduced payments.
As part of the refinancing, BWD will also be issuing $2 M in new debt at 2.19% for 15 years for planned upcoming Capital expenditures. Grants and low interest financing will continue to be a focus of BWD Board and staff for the foreseeable future.