CORPUS CHRISTI, Texas — The City of Corpus Christi's desal project was approved for a low interest loan from the state, the third loan of this type the City has received for the Inner Harbor Facility.
City Manager Peter Zanoni said that before the Texas Water Development Board approved it's $535 million loan request, the city had all the financing in place to cover it's $750-million desal project.
The costs were covered by a combination of loans and City funds. However, this low interest loan will help the City save taxpayers money. If the City is awarded a federal grant there could be another $180 million.
The City's desal application with the Texas Water Development Board was rated the second highest proposal among 20 from around the state. On Tuesday, that board met in Austin and approved the City's request for $535 million in low interest loans.
"It just means we are really utilizing the tools that the state of Texas is offering us to secure these monies for a project such as desalination which is a huge project, so it means a great deal towards the taxpayer," Mayor Paulette Guajardo said.
What does it mean to taxpayers? A huge cost savings, according to Chief Operating Officer for Corpus Christi Water Drew Molly.
"We would ultimately save the ratepayer $126 million over the life of the project, so it's a 30-year note," Molly said. "Basically we are borrowing money for 30 years to pay for this project and over the years we would save the ratepayer $126 million."
The City is also applying for a grant to help pay for the desalination plant and getting those federal dollars would be a huge win.
"We think we will be successful with grant funding," Molly said. "We don't know how much but we know we have a great relationship with the Bureau of Reclamation, they're partners of ours on the Choke Canyon Reservoir so we have a very good familiarity with that organization."
City Manager Peter Zanoni said the federal grant the City is going to apply for in the fall is near the $200 million mark.
"We're going to apply for grants with the Bureau of Reclamation, the U.S. Bureau of Reclamation up to $180 million and if we get that grant it will be a nonrepayable grant."
City officials told 3NEWS that our water rates are not going to go up this year because of the desal project. However, in the coming years when the loans become due there will have to be increases.