Tennessee Governor Bill Lee and the Tennessee Department of Environment and Conservation Commissioner David Salyers Monday announced approximately $2 million in low-interest loans for clean water and drinking water infrastructure improvements.
Improved water and wastewater infrastructure is critical for improving water quality and protecting public health, said officials.
The loans are for the city of Cleveland in Bradley County and the town of Bell Buckle in Bedford County. Cleveland will receive a construction loan totaling $1,771,000 and Bell Buckle will receive a construction loan of $325,000. Further, the entire loan for Bell Buckle comes with principal forgiveness.
The loans are part of the State Revolving Fund Loan Program. 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.
“We are pleased to assist local communities with resources to improve infrastructure,” Governor Lee said. “These loans will help keep Tennesseans safe and bolster quality of life for citizens in these areas.”
“The low-cost loan program has been a major boost for communities across the state,” Commissioner Salyers said. “We look forward to the improvements in Cleveland and Bell Buckle that these loans will make happen.”
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, which applies to the Bell Buckle loan announced Monday.
During fiscal year 2019, TDEC has awarded $13,345,300 in drinking water loans and $83,194,500 in clean water loans for a total of $96,539,800 to meet the state’s water infrastructure needs. Tennessee’s Clean Water State Revolving Fund Loan Program has awarded more than $2 billion in low-interest loans since its inception in 1987. The state’s Drinking Water State Revolving Fund Loan Program has awarded more than $300 million in low-interest loans since its inception in 1996.
TDEC 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.
The clean water loan announced Monday is for:
City of Cleveland (Bradley County) – The city of Cleveland will receive a construction loan totaling $1,771,000 for collection system expansion (installation of 8,900 linear feet of sanitary sewer line) to eliminate use of septic systems in the area. The loan includes federal funding in the amount of $1,593,900 and an additional $177,100 in principal forgiveness that will not have to be repaid. The loan has a 20-year repayment period at an interest rate of 1.37 percent.
Town of Bell Buckle (Bedford County) – The town of Bell Buckle will receive a construction loan in the amount of $325,000 to complete the Main Street water line replacement project, replacing aging cast iron mainline that serves 20 percent of the town’s population. The project is funded with principal forgiveness as part of TDEC’s effort to better address the needs of small and disadvantaged communities. The loan has a 20-year term with no interest.