The state awarded its first $100 million toward new reservoirs and water supply projects across Georgia on Wednesday, although officials hedged their bets on what environmentalists have called a risky investment.
The money is the first to flow through a new program launched last year by Gov. Nathan Deal in a four-year plan to spend $300 million on projects expected to help boost the state’s home-grown water supply.
Nearly all of the money awarded in this initial round came in the form of loans to local governments and agencies, who will eventually have to pay the money back. Eight projects received funding out of 15 submitted for consideration, mostly in North Georgia, for loans and grants to plan, permit or build reservoirs or wells.
Nine applicants had asked the state to take a direct ownership stake in their project – a novel step envisioned by Gov. Nathan Deal last year when he pledged to jump-start reservoir development. But state officials passed on investing in any reservoir, buying into just two projects, both of them involving wells.
Kevin Clark, executive director of the Georgia Environmental Finance Authority (GEFA), said the reservoir projects “weren’t really ripe” yet for that kind of direct funding, despite getting millions in loans. But he said he was encouraged the program was off to a good start. In all, the agency awarded $90.4 million in loans, with an additional $9 million in direct state investment money.
A second round of award money is expected to be given out early next year.
Deal started the finance program to expand Georgia’s water supply amid an ongoing fight with Alabama and Florida. Lake Lanier, which supplies metro Atlanta with water, has long been the catalyst for lawsuits from neighboring states over water policy.
Clark, who led a task force to consider how to implement Deal’s plan, has said all options are on the table, including water reuse and desalinization projects. Reservoirs and wells, however, made the first cut for funding.
With seven water supply reservoirs in the federal permitting process — and others in planning stages — Georgia is in the spotlight for what critics consider risky, high-cost projects.
"It’s kind of throwing good money after bad,” said Jenny Hoffner, water supply director for the Washington-based American Rivers, which last month spotlighted Georgia in its “Money Pit” report on water supply reservoirs in the Southeast.
The group, founded in 1973, works to help restore and protect the nation’s rivers and streams.
Hundreds of millions of dollars are already on the line for both taxpayers and utility ratepayers, Hoffner said. Even for those projects that received money Wednesday, more money will be needed to complete construction and get operations up and running.
“That’s a huge burden that we could avoid by using cheaper, faster and more reliable sources of water supplies that are not on the [GEFA] list,” she said. Among alternatives, Hoffner said communities should focus on more efficient water use, including rethinking how they use their current water supply systems.
Paulding County Administrator Michael Jones said his community’s proposed 305-acre Richland Creek reservoir will come just in time. The county, which has grown steadily even with the recession, was approved for a $29 million, 40-year loan for the project, which is estimated to cost $86.4 million in all.
“We will outstrip our resources some point in 2020, 2030,” Jones said. “We know the demands are going to be there. These reservoir takes us further on down the line."
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