Wichita Northwest Water Facility Receives WIFIA Funding to Save Ratepayers Nearly $100 Million

The City of Wichita, with support from Burns & McDonnell, secured nearly $280.9 million in federal credit financing to fund the new Wichita Northwest Water Facility. The new water treatment plant will provide 120 million gallons per day to serve the City of Wichita, surrounding communities, industries and wholesale customers.

Burns & McDonnell has been working closely with the City to secure funding to deliver a state-of-the-art facility while providing the best possible value to ratepayers since beginning the Water Infrastructure Finance and Innovation Act (WIFIA) application process in 2018. Through WIFIA, a low-interest loan program will allow debt payments to be deferred until five years after construction is complete, saving ratepayers an estimated $97 million compared to traditional municipal bond issuance. In addition, the project can start seven years earlier than it otherwise would without a WIFIA loan.

"We have already had great success in finding process optimization and value engineering opportunities that benefit both the project and the ratepayers of Wichita, saving millions of dollars in capital construction costs," says Ron Coker, senior vice president and general manager of the Water Group, Burns & McDonnell. "The plan also gives the community a high level of financial security as the guaranteed maximum price will not go up — even if interest rates, material costs or other factors do."

The project to replace the City's current water treatment plant, which is 80 years old, is being designed and built through a joint venture led by Burns & McDonnell and Alberici Construction. The project utilizes a progressive design-build delivery method that allowed the City to lock in pricing early in the design process nearly $15 million below the City's budget. In today's trying times, the design-build partnership is also heavily focused on utilization of local resources and includes several local design and construction firms along with national design partner HDR.

The WIFIA loan allows the City to finance nearly $280 million of construction costs at a 1.17% interest rate over a 30-year term. The City will also be seeking financing from Kansas' State Revolving Fund for an additional $267 million to cover the total costs associated with this $550 million project.

"Our team is rooted in the Wichita community and is committed to the successful delivery of the Northwest Water Facility and associated economic growth in Wichita," says Coker. "This project is important for the people of Wichita and we take our responsibility very seriously. Every day, we will continue to work with the City's staff to design and build this facility in a manner that drives efficiency and meets the needs of the people of Wichita."

Burns & McDonnell has delivered water projects for the City of Wichita for over a century. In response to the growing need to fortify the nation's critical infrastructure, Burns & McDonnell continues to design and build the systems and structures that will keep the U.S. moving forward. Across the nation, the firm is currently working on nearly 13,000 projects that touch the 16 critical infrastructure categories identified by the U.S. Department of Homeland Security.

Source: Burns & McDonnell
Date: May 6, 2020