Tennessee’s Loan Program Enables Chattanooga Sewer Restoration

Jul 11

Tennessee’s Loan Program Enables Chattanooga Sewer Restoration

The city of Chattanooga has recently been granted awarded a $42.5 million low-interest loan from the state for local wastewater infrastructure improvements. This is the largest amount approved, which includes more than $60 million in loans, to five community and wastewater authorities. The loan for Chattanooga is expressly for maintaining its water and wastewater treatment plant by way of improvements, as well as, a collection system rehabilitation project. Chattanooga is spending an estimated $250 million to rehabilitate an aging sewer system that- during heavy rains- can send hundreds of thousands of raw waste flooding into the Tennessee River water. Tennessee’s 20-year wastewater loan carries a 1.29 percent interest rate. The State Revolving Fund Loan Program provides loans that help communities, utility districts, and water and wastewater authorities finance projects that protect Tennessee’s ground and surface waters and public health. Loans are used to finance the planning, design and construction of water and wastewater facilities. The loans are channeled through two separate programs: Tennessee’s Clean Water State Revolving Fund Loan Program (CWSRF) and the state’s Drinking Water State Revolving Fund Loan Program (DWSRF). Over the span of nearly 30 years, Tennessee’s CWSRF has awarded more than $1.6 billion in low-interest loans. The loans and principal forgiveness help fulfill infrastructure needs that will help communities foster economic development, keeping the city moving forward. Additionally, the Environmental Protection Agency provides grants to fund the program. Repayments are returned to the program and are used to fund future loans. Interest rates are often less than local governments can find on the private market with some interest charges at zero percent.

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