Title
Resolution to Adopt the Detroit Water and Sewerage Department (DWSD) Sewer Rehabilitation Project Plan for Fiscal Year (FY) 2027 Clean Water State Revolving Fund (CWSRF) Funding Consideration
Body
Agenda of: April 22, 2026
Item No.: 2026-112
TO: The Honorable
Board of Directors
Great Lakes Water Authority
FROM: Suzanne R. Coffey, P.E.
Chief Executive Officer
Great Lakes Water Authority
DATE: April 22, 2026
RE: Resolution to Adopt the Detroit Water and Sewerage Department (DWSD) Sewer Rehabilitation Project Plan for Fiscal Year (FY) 2027 Clean Water Revolving Fund (CWSRF) Funding Consideration
MOTION
Upon recommendation of Nicolette Bateson, Chief Financial Officer/Treasurer, the Board of Directors (Board) of the Great Lakes Water Authority (GLWA) approve the attached resolution to adopt the Detroit Water and Sewerage Department (DWSD) Sewer Rehabilitation Project Plan for FY 2027 Clean Water State Revolving Fund (CWSRF) funding consideration; and authorizes the CEO to take such other action as may be necessary to accomplish the intent of this vote.
BACKGROUND
The Great Lakes Water Authority (GLWA) secures capital improvement financing for Detroit Water and Sewerage Department (DWSD) in accordance with foundational documents related to the establishment of GLWA. Pursuant to Section 7.2(b) of the Regional Sewage Disposal System Lease between the City of Detroit and GLWA, “The Authority shall cooperate fully with the City in the implementation of Detroit Capital Improvement Program, including financing through the Authority.…”
DWSD has identified a Sewer Rehabilitation Project for submittal to the Michigan Department of Environment, Great Lakes, and Energy (EGLE) for FY 2027 CWSRF funding consideration. This project consists of rehabilitating aging and/or compromised sewer mains in select neighborhoods throughout the city of Detroit located in all Council Districts. This includes cured-in-place pipe (CIPP) rehabilitation, spot repairs, and manhole replacements. These improvements will reduce the frequency of basement backups and cave-ins caused by sewer mains. The impact of the project will be improved customer satisfaction and safe, reliable collection of wastewater. The estimated cost of this project is $39 million.
The deadline to submit all CWSRF project planning documents to EGLE is May 1, 2026. A public hearing must be held for the impacted area of the project prior to submission. The Sewer Rehabilitation Project Plan was presented at a DWSD Public Hearing on February 18, 2026, and adopted by the DWSD Board of Water Commissioners on the same date. Per notification from EGLE, GLWA is not required to hold a separate public hearing for the local project. The project plan and Public Hearing Notice can be viewed on DWSD’s website at: www.detroitmi.gov/dwsd <http://www.detroitmi.gov/dwsd>.
JUSTIFICATION
The Michigan Department of Environment, Great Lakes, and Energy requires the GLWA Board of Directors approve a resolution adopting the DWSD project plan. The resolution must be signed and included with the final project planning documents by the May 1, 2026 deadline. DWSD shall submit the project plan to EGLE with GLWA as the loan applicant if approved for funding.
GLWA concurs with the DWSD Sewer Rehabilitation Project Plan adoption and will pursue low interest funding through the CWSRF program. Historically, DWSD has qualified as a significantly overburdened community, allowing it to secure additional priority points, which improves the chance of funding, and to attain the lowest CWSRF interest rate. While FY 2027 CWSRF interest rates may not be published until October 2026, significantly overburdened applicants currently qualify for 1.00 percent financing on 20-year and 30-year loans. These loans typically offer substantial interest savings compared to similar open-market revenue bonds. By way of example, a $39 million CWSRF loan provides approximately $26.5 million in potential interest savings over a 30-year term compared to a 4.5% market-based alternative.
Another advantage to the SRF program is interest costs are only incurred on amounts drawn from the loan instead of the entire loan amount. This results in additional debt service savings early in the term of the loan compared to market-based transactions.
BUDGET IMPACT
GLWA will be the loan applicant on CWSRF loans issued on behalf of DWSD, and DWSD will be the CWSRF loan recipient as determined by EGLE. All project costs financed by GLWA, on behalf of DWSD, through the CWSRF program bonds and resulting principal and interest payments on the bonds will be directly allocable to the DWSD local system. Debt service is anticipated to begin on October 1, 2027 for this project and will be included as part of the FY 2028 - FY 2029 biennial budget.
COMMITTEE REVIEW
This matter was presented to the GLWA Audit Committee at its March 27, 2026 meeting. The Audit Committee unanimously recommends that the Great Lakes Water Authority Board of Directors approve the attached resolution to adopt the Detroit Water and Sewerage Department (DWSD) Sewer Rehabilitation Project Plan for FY 2027 Clean Water State Revolving Fund (CWSRF) funding consideration as presented.
SHARED SERVICES IMPACT
This item does not impact the shared services agreement between GLWA and DWSD.