Chattanooga, Cleveland Get Wastewater Loans From TDEC

  • Tuesday, February 19, 2019

Five communities, including Chattanooga and Cleveland, will receive $66.8 million in low-interest loans for clean water and drinking water infrastructure improvements from TDEC.

The city of Chattanooga will receive two loans totaling $24 million for inflow and infiltration correction for Dobb Branch Sewer improvements and inflow and infiltration correction for the South Chickamauga Sewer Basin. The first loan is for $3 million with federal funding in the amount of $2,700,000 and an additional $300,000 in principal forgiveness that will not have to be repaid. A $3 million cap applies to the federal funding in the clean water loan program. A companion loan is funded from the State Revolving Fund at $21 million. Both loans have a 20-year repayment period at an interest rate of 2.05 percent.

The city of Cleveland will receive a loan increase in the amount of $379,500 for its collection system expansion to include the installation of approximately 7,750 linear feet of sewer lines to replace septic tanks. The project is funded from the State Revolving Fund with a 20-year repayment period and an interest rate of 1.56 percent.

Tennessee’s Revolving Fund Loan Program maintains priority ranking lists for both the Drinking Water State Revolving Fund and the Clean Water State Revolving Fund. Over $90 million is loaned annually to cities, utility districts, and energy or water/waste water authorities, with projects appearing on the priority ranking lists for planning, design, and construction of eligible water and wastewater projects.

Governor Bill Lee said, “I’m pleased to see our communities are getting the help they need for infrastructure development.”

“These programs help communities make updates they need in infrastructure, and we are glad we can assist in this way,” said TDEC Commissioner David Salyers. “Abundant, clean water is important to quality of life in Tennessee, and this program is an excellent way to make such improvements affordable.” 

Through the State Revolving Fund Program, communities, utility districts and water and wastewater authorities can obtain loans with lower interest rates than most can obtain through private financing. Interest rates for loans can vary from zero percent to market rate based on each community’s economic index. Loans utilizing EPA grant funds can also include a principal forgiveness component.

Tennessee’s Clean Water State Revolving Fund Loan Program has awarded more than $2 billion in low-interest loans since its inception in 1987. Tennessee’s Drinking Water State Revolving Fund Loan Program has awarded more than $300 million in low-interest loans since its inception in 1996.

The Department of Environment and Conservation administers the State Revolving Fund Program in conjunction with the Tennessee Local Development Authority. The U.S. Environmental Protection Agency provides grants to fund the program, and the state provides a 20 percent match. Loan repayments are returned to the program and are used to fund future SRF loans.

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