Jul. 1--EL PASO -- The Public Service Board is on the brink of getting a $12 million, interest-free stimulus package loan that will be used to fund five stormwater projects the state has identified as priorities.

The PSB of the El Paso Water Utilities is briskly putting together a final application to meet a July 22 deadline that would allow the utility to break ground by February on projects that include a wetland in the Lower Valley.

"We always enjoy free money," said PSB Chairman Ruben Guerra. "That's going to play a huge role in how we evaluate any future rate increase, and it may mitigate the need for a rate increase for some time."

The board voted 4-0 at a special meeting Tuesday to request that the City Council issue $12 million in revenue bonds to be purchased by the Texas Water Development Board -- the agency administering the stimulus program. Mayor John Cook, a member of the Public Service Board, was absent and did not vote.

City officials estimate the loan will allow the utility to save $6.7 million that otherwise would go for paying interest.

The Texas Water Development Board in turn will provide the PSB a 20-year, no-interest loan to finance five projects: --Featherlake II Basin, a $3.6 million project to build a second water retention site near Roseway and Loop 375 that will double as a wetland.

--Pershing Dam, a $1.8 million project to raise by 4 feet and widen an emergency spillway that was breached during the 2006 floods.

--RV Channel, a $1.6 million project to reconstruct a dilapidated stormwater channel that crosses Interstate 10 east of Loop 375.

--Northeast Channel 2, a $3.8 million project to build a stormwater channel that runs parallel to Sun Valley Drive.

--Basin G Excavation, a $1.2 million project to regrade and expand the basin near the Jonathan Rogers water treatment plant in the Lower Valley.

Nick Costanzo, El Paso Water Utilities vice president, requested Tuesday that the PSB ensure the readiness of those projects to receive the interest-free loan and meet the deadlines imposed by the Texas Water Development Board.

"This is a unique opportunity, the stimulus funding, so we can address stormwater issues without affecting stormwater rates," Costanzo said.

The PSB is asking the City Council to authorize a request for financial assistance at its meeting July 14, then OK the sale of revenue bonds by Sept. 23. If things fall into place, the PSB expects to receive the money by November.

Darren Meritz may be reached at dmeritz@elpasotimes.com; 546-6127.

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