On Oct. 7, 2022, the Colorado Water Resources and Power Development Authority (CWRPDA) Board approved $76 million for Denver Water to use for lead service line replacements. Specifically, this includes a $36,123,628 loan with a 30-year term, two payments annually at an interest rate of 2.75%, which will cost Denver Water approximately $1,776,146 in debt service annually. The funding Denver Water received is a low-interest loan that the utility will repay, with $40 million of the loan’s principle forgiven immediately as allowed by the legislation.

The $76 million in federal funding was requested to help accelerate the Lead Reduction Program in 2023-2025. The funds collected from the funding loan will go directly to replacing more lead service lines, ultimately saving ratepayers money as it will fast-track the program by roughly 1.5 years and result in an estimated 7,600 lead service line replacements.

Federal funds allow the Lead Reduction Program to be accelerated and completed in less time. For every 4,500 additional lead service lines replaced using these funds, the overall length of the program will be one year shorter.

The Lead Reduction Program cost is not just covered through water rates, but also bonds, cash reserves and hydropower generation, which is in line with other large capital improvement projects undertaken regularly by Denver Water. It’s important to note that the amount of money recovered from rates for the Lead Reduction Program varies based on the level of service required for each of our customer types, as our capital program costs are recovered via a cost-of-service model. That means the amount a customer’s rate may increase based on the Lead Reduction Program will vary depending on where the customer lives in Denver Water’s service area, the type of water user and how much water they use.