Bond Buyer 6/10/14 2:54pm ET By Jim Watts

DALLAS — President Obama on Tuesday signed into law a $12.3 billion water infrastructure bill that will fund 34 port, inland waterway, and flood control projects over the next 10 years.
The first water bill passed by Congress since 2008, the Water Resources Reform and Development Act includes a five-year, two-part $350 million Water Infrastructure Finance and Innovation Act that provides credit enhancement and loans for flood control, drinking water, and waste water projects.
The two WIFIA programs — one for flood control financing overseen by the U.S. Army Corps of Engineers and the other for drinking and waste water financing overseen by the Environmental Protection Agency — are modeled on the Transportation Infrastructure Finance and Innovation Act program for highway and transit projects.
The low-interest WIFIA loans can be used to fund up to 49% of large water projects costing at least $20 million and smaller projects of up to $5 million on systems serving 25,000 customers or fewer.
However, tax-exempt bonds, including private activity bonds, cannot be part of the funding package for projects that receive WIFIA assistance.
Total funding for the five-year pilot WIFIA program is set at $40 million in fiscal 2015, $50 million in 2016, $70 million in 2017, $90 million in 2018, and $100 million in 2019.
The WIFA program was funded at $100 million a year in the original Senate version but was not included in the House bill.
Funding the 34 projects specified in the new law are expected to require $5.4 billion of federal spending through 2019 and another $6.9 billion through 2024, the Congressional Budget Office said in its analysis of the legislation. Several projects expected to extend past 2024.
The largest single allocation in the bill is $6.7 billion for the $10.3 billion Morganza-to-Gulf system of levees, locks, and other flood control structures on the Mississippi River in Louisiana. Other large projects in the list of 34 include $1.2 billion for environmental work in Chesapeake Bay and $748 million for improvements to the Sabine Neches Waterway along the Texas-Louisiana line.

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