One Vista Ridge Loan Application Approved; A Second Denied
The San Antonio Water System could save millions of dollars in financing for one Vista Ridge project that’s on a priority list for funding. But getting that low interest loan may depend on another Vista Ridge project didn’t make the list.
In 2013 voters approved the State Water Implementation Fund for Texas, commonly referred to as SWIFT. The fund provides highly sought-after low-interest loans for building water projects. Qualifying for a SWIFT loan can save utilities and taxpayers a lot of money. For example, a $140 million SWIFT loan approved for Tarrant County last year is expected to save rate payers there more than $39 million over the cost of a traditional market loan.
The Texas Water Development Board recently considered two SWIFT loan applications for the Vista Ridge pipeline.
This week a $127 million loan request submitted by SAWS was placed on the priority list for approval. SAWS President and CEO Robert Puente says the money would build infrastructure needed to distribute the volume of water expected to flow through the Vista Ridge pipeline.
"When this project comes online our current system cannot accept 50,000 acre feet of water. Therefore at the intake we have to build storage tanks, we have to build bigger pipes, we have to have bigger pumps to move that water into our distribution system," Puente said.
The other $855 million loan request was submitted by the Central Texas Regional Water Supply Corp., a nonprofit created by financially troubled Abengoa Vista Ridge. It would have helped build the 142-mile pipeline. But the Texas Water Development Board’s Jeff Walker says the agency didn’t include that request on its priority list of projects to fund because Central Texas couldn’t prove it was a political subdivision, and that’s required by law.
"We asked some follow-up questions and never could get them to respond to us so we aired on the side of caution and did not prioritize them," Walker says.
So now there’s a chicken and egg kind of question: should the state award the low interest loan to SAWS for distributing the Vista Ridge water if the funding for the pipeline that would deliver the water is in question? Walker with the Water Development Board says that’s part of what the agency will ask SAWS in the next step of the process.
"How will this project be used? Will it be used if that water’s never available? How will it be paid for? What would be the burden on the citizens?," said Walker in describing the questions that must be satisfactorily answered for the SAWS application to be given final approval.
"You don’t want to fund an asset that’s never going to be used, that’s a burden to the taxpayers, a burden to the city and not a very good use of funds," Walker said.
The water development board expects final approval on this round of loans in July with money available for projects by December.
The Central Texas Regional Water Supply Corp. did not anyone to answer Texas Public Radio's questions. Puente says he’s not concerned about the Central Texas loan being denied. He says the company taking over the Vista Ridge project from ailing Abengoa has financing options, though it’s unlikely those options will provide the cost savings available through a state SWIFT loans.