Los Osos sewer project will have easier time getting federal funds with waiver

President Barack Obama has signed legislation that removes a key obstacle to obtaining federal funding for the Los Osos sewer project.

The agriculture appropriations bill for 2010 waives a rule that prevents communities with populations greater than 10,000 from being eligible for federal loans and grants.

Lawmakers and county public works officials say the waiver significantly increases the likelihood of receiving assistance in paying for construction of the $165 million sewer project.

“This is a very important milestone for the project,” said John Diodati, county public works administrator and grants coordinator.The county plans to apply for both grants and low-interest, long-term loans. The amount of the funding request has not been determined, but the U.S. Department of Agriculture has more than $3 billion available.

“It’s a huge pot of money,” Diodati said. “We are optimistic that it will fund a significant portion of the project.”

Once federal funding has been received from one source, it increases the likelihood that funding can be received from other federal agencies, Diodati said. The Environmental Protection Agency and the Department of Energy also have money available for projects of this kind.

Diodati plans to submit the application for the federal funding by the end of the year. A decision by the USDA is expected in early March.

Getting the waiver included in the bill was a cooperative effort among Reps. Lois Capps, D-Santa Barbara, and Kevin McCarthy, R-Bakersfield, and Sen. Dianne Feinstein.

“This announcement comes after the San Luis Obispo County Supervisors recently approved a site for the wastewater treatment plant, clearing another significant hurdle for this project,” Capps said.

The county is building a complete sewage collection, treatment and effluent disposal system to replace septic systems currently used in Los Osos. The project is intended to prevent nitrates from polluting groundwater and bacteria from polluting Morro Bay as well as stop saltwater intrusion into deeper aquifers.

Reach David Sneed at 781-7930.