Arizona’s Water Infrastructure Finance Authority is “strongly considering” public financing as it seeks ideas on how the drought-prone state could expand its water supply with the help of a $1 billion fund, the agency’s head said.
WIFA Director Chuck Podolak told reporters Friday that bonds are “on the table” in conjunction with the long-term water augmentation fund created last year by the state legislature. At least 75% of the money is allocated for water importation projects that would likely be developed through public-private partnerships.
Arizona Water Infrastructure Finance Authority
“I expect a successful project will involve private-sector debt, private-sector equity,” Podolak said. “We have the ability to put some public-sector equity into that and I think we do have the ability to put in some public-sector debt.”
Podolak added the use of bonds would depend on the type of project, the financing package, and the legislature’s commitment to place $1 billion into the augmentation fund over three years.
As a first step, WIFA issued a request for information last week seeking to identify and understand “water augmentation opportunities,” with a submission deadline of Nov. 15.
Podolak said the agency is looking for potential project ideas, innovations and opportunities, as well as suggestions on ownership, partnerships, and financings.
“We’re hoping to have a lot come from the engineering sector, the project development sector, the financial sector — really the people who may come to us with projects,” he said. “At the same time we’re doing this RFI, we’re doing what we’re calling the bottom-up needs assessment and naturally looking at that demand side of things.”
The Colorado River supplies 36% of Arizona’s water, with groundwater accounting for 41%, in-state rivers generating 18%, and reclaimed water providing 5%.
WIFA will launch a project solicitation process later this year or early next year and expects IDE Technologies to participate in that competitive process with its desalination proposal, according to Podolak.
In December, the WIFA board agreed to evaluate the Israel-based company’s proposal that envisions a pipeline from a yet-to-be-built desalination facility in Puerto Penasco, Mexico, to the state’s major water distributor, the Central Arizona Project.
In the initial phase of the project, WIFA would provide a long-term commitment on behalf of the state to purchase 300,000 acre-feet per year of treated water that could increase to up to 1 million acre-feet annually in subsequent phases.
“It’s very, very clear the board wants to see alternatives and the board wants to see projects like IDE compared against other options,” Podolak said, adding WIFA staff has yet to present an analysis of the IDE proposal to the board.