Oro Valley Council approves $12M WIFA loan for water infrastructure projects

During the Oro Valley Town Council Regular Session on April 16, 2025, a significant discussion centered around the approval of a loan agreement with the Water Infrastructure Finance Authority of Arizona (WIFA). This loan, amounting to $12 million from the Drinking Water State Revolving Fund, aims to support the completion of the Northwest Recharge Recovery Delivery System (NWRDS) project, which is crucial for the town's water sustainability.

The NWRDS project is designed to enhance Oro Valley's water resources by delivering an additional 4,000 acre-feet of water. The project consists of several partnered and independent initiatives, with a majority already funded and under construction. The council previously approved a $6 million private placement loan to finance part of this initiative. However, two independent projects still require additional funding to reach completion.

Water Utility Director Peter Abraham emphasized that the need for this financing has been anticipated since 2019, as outlined in the town's water rate reports. The loan will specifically fund the construction of the Twin Peaks booster station and seven miles of transmission main, with an expected completion date in the summer of 2026. This project represents a long-term investment in the community's water infrastructure, ensuring sustainability for future generations.

The WIFA loan agreement includes a provision for over $1 million in forgivable principal, reducing the town's repayment obligation to approximately $11 million. The loan will be amortized over 20 years, with an estimated interest rate of around 3.45%. Notably, the town will not incur interest charges until it begins to draw on the loan, allowing for potential savings.

The council's approval of this loan is a critical step in securing Oro Valley's water future, reflecting a proactive approach to managing the town's resources amid growing demands. As the project progresses, it is expected to bolster the community's infrastructure and support its long-term sustainability goals.