Shearman & Sterling represented the U.S. Environmental Protection Agency (USEPA) in connection with the issuance of an approximately $440 million loan to the Los Angeles County Sanitation Districts (LACSD) to support the Joint Water Pollution Control Plant Effluent Outfall Tunnel Project (“Clearwater Project”) including a new agreement setting forth terms applicable to all secured debt facilities of LACSD for their sewerage system. This loan, issued under the Water Infrastructure Finance and Innovation Act (WIFIA), will help replace the tunnels that the main sewer system relies on and modernize wastewater infrastructure across Los Angeles County. These improvements will prevent wastewater from flooding waterways, contamination of drinking water and ensure the reliability of a sewerage system that the five million citizens in Los Angeles County depend upon.
The Clearwater project will combine the two current outfall tunnels into one 18-foot diameter, 7-mile long tunnel system that will have sufficient capacity for the higher flow levels that Los Angeles County experiences during storms.
To date, the WIFIA program has extended 85 loans totaling $14.9 billion in credit assistance to help finance over $32 billion for water infrastructure projects. Shearman has represented USEPA on more than one-third of WIFIA financings closed to date.