Amador Water Agency to borrow for treatment‑plant upgrades after long-standing capacity shortfall; board briefed on WIFIA loan plan
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Summary
Amador Water Agency officials briefed supervisors that Ione and Tanner water treatment plants need an estimated $60 million in upgrades to restore reliable capacity, and outlined a financing plan centered on a WIFIA low‑interest loan and bonding that will likely require rate increases.
Amador Water Agency General Manager Larry McKinney briefed the Amador County Board on the agency’s multi‑year efforts to address treatment‑plant capacity and system reliability in Ione and Tanner service areas.
McKinney said both the Ione and Tanner plants have been operating at or above maximum capacity for years, limiting new connections and heightening reliability risks. A recent update put the combined treatment‑plant improvements at roughly $60 million, with Ione’s upgrade estimated at about $27 million. The projects collectively would increase plant maximum and ‘‘reliable’’ capacities: McKinney described Ione’s current permitted maximum as about 2.8 million gallons per day (MGD), a targeted reliable capacity of 3.0 MGD and a design maximum of 4.0 MGD.
The agency plans to finance the projects with a combination of borrowing and grants. McKinney told the board AWA is pursuing a Water Infrastructure Finance and Innovation Act (WIFIA) low‑interest federal loan and expects to close a WIFIA loan in December; the loan use and WIFIA structure would allow draws as work proceeds and waives interest payments until project completion. He said the agency is also preparing to go to the bond market for additional financing and noted the agency’s credit ratings have improved since 2021 after earlier work to address enterprise financial health.
McKinney said the agency’s five‑year financial plan anticipated borrowing but inflation and higher construction costs mean the projects are now more expensive than the 2021 projections. He said the board is considering rate increases over the next five years to meet debt coverage requirements and pay for capital. The agency will hold a public rate hearing in December and is running a rate study now to present recommended adjustments. McKinney said the agency has been conservative in financial modeling and is not assuming new growth when calculating borrowing capacity.
Ending: McKinney said if projects are financed on schedule and bid results are favorable, construction could begin in late 2025 and may take 2–3 construction seasons to complete. He asked the county to continue supporting letters for federal grant and appropriations requests and to maintain coordination with local planners.
