The state is planning to spend approximately $1.28 billion next year on a range of projects designed to improve the environmental infrastructure of the systems that deliver clean drinking water to residents and eliminate harmful substances in sewage discharged into New Jersey’s waterways.
The financing plan advanced by the New Jersey Environmental Infrastructure Trust is the second-largest program ever proposed by the agency and would include about $355 million to build greater resiliency into those facilities, many of which suffered massive damage during Hurricane Sandy.
The program, reviewed annually by the Legislature prior to adoption of the state budget for the next fiscal year, is expected to win approval before the summer recess. The four-bill package already has cleared the Senate Environment and Energy Committee.
What is unusual about this year’s program is that New Jersey received an extra $229 million infusion of funds to deal with problems created by Sandy, in addition to the yearly installment it receives from the federal government to address water quality issues.
Those federal dollars will be matched with state money through the trust to address the impact of the superstorm on water and wastewater systems. According to the state Department of Environmental Protection, those facilities suffered about $2.6 billion in damage from the hurricane.
Beyond building more resiliency into those systems, the funding package this year will provide up to $35 million to those facilities to provide them with backup power in case the traditional power grid fails as happened during Sandy.
Because the plants had no power, more than 37 boil-water advisories were issued, affecting 360,000 residents. Outages at nearly 100 wastewater treatment plants led to billions of gallons of untreated sewage flowing into New Jersey’s waterways.
The trust, set up in 1985 by the Kean administration, has proven to be a successful vehicle for helping municipalities and others finance needed improvements to facilities providing drinking water to residents and upgrading wastewater treatment plants. It provides low-interest loans to those facilities.
Since it was established it has financed more than 1,100 projects totaling over $6.1 billion, according to David Zimmer, the executive director of the trust. Officials believe the low-interest loans has saved ratepayers at least $2.1 billion, by reducing financing costs for projects by 25 percent to 30 percent, he said.
This year, there was a quite bit of demand from facilities seeking funding, with requests of more than $1.24 billion, according to Zimmer.
There are several wrinkles in this year’s financing plan. The state will set aside $57 million in clean water project loans, which could be forgiven once construction on the project starts. Another $11 million in drinking water quality loans could be forgiven, once project construction begins.
The program also will provide $12 million to help deal with problems cause by combined sewer overflow systems, a major source of pollution to the state’s waterways when heavy rains cause raw sewage to seep into rivers and bays.
Another $12 million will be set aside for projects in the Barnegat Bay Watershed, one of the state’s most threatened waterways.
The state also plans to provide a modest amount of money to help fund improvements to small drinking-water systems serving populations of up to 500 people.
While more expansive than in past years, the program stills falls far short of what some say the state needs to invest in upgrading its water infrastructure. A blue-ribbon panel suggested a year ago that the state should invest $44 billion in its water infrastructure over the next five years.