The needs of Provo City's wastewater infrastructure as well as the push to meet new State requirements have been discussed for some time now. Public Works met with the State regarding a loan for a portion of the cost of the project. The State Water Quality Board authorized funding of $2 million in principal forgiveness and a loan of $75.8 million with a 0.5% interest rate repayable over 20 years. The payments would be interest only until the project is completed, principal payments not to exceed $50,000 per year until 2027.
Council would like to move forward with the loan. Because the request was for $120 million, the funding gap would need to be addressed. Several options were discussed and Council members invited a proposal from staff regarding the issue of sewer capacity banking and an evaluation of the net present value calculation of the State loan versus traditional revenue bonds. This will return to a future Council meeting. You can view the presentation slides online