The Kennewick Irrigation District will receive a $5 million, no-interest loan from the state to help pay for the districts project to bring Yakima River water to prime grape-growing land on Red Mountain.
The loan was part of the budget approved by the state Legislature last weekend, officials told KIDs board on Tuesday.
The loan is a critical part of paying for the $20.2 million project. KID already had received half of the $10 million expected from the state, but needed the other half to stay on schedule.
Officials hope to have river water flowing to all 1,785 acres in the Red Mountain American Viticultural Area between Richland and Benton City by summer 2014 - about a year earlier than originally expected.
Construction already has begun on the Kiona intake station, pump house and other improvements needed to deliver water to landowners on Red Mountain. The intake station is near the intersection of Highway 224 and Demoss Road.
Jason McShane, KIDs engineering and operations manager, said the request for bids will go out soon to build the pipelines and the two reservoirs needed. The KID board on Tuesday unanimously approved amending the contract with design team RH2 Engineering of Richland.
McShane said the amendment was needed to incorporate the decision to bury one of the reservoirs because of concerns of how the 30-foot tank would obstruct views. That will change the pipeline design.
It also will address the system that will allow KID to control the pumps and reservoir facilities using computers, he said.
The cost increase of $224,000 brought the total amount KID is authorized to pay RH2 Engineering to about $3.9 million, McShane said. That money would have been spent anyway, but in a different contract, he said.
This looks like one more hurdle that we can get behind us, said Gene Huffman, KIDs board president.
KID officials are still considering taking some of the KID-owned land out of the local improvement district, or LID, formed for the project, Huffman said.
Property owners within the LID will pay the almost $20.2 million cost of the project. KID is one of the landowners, with about 620 acres.
KID could choose to take about 111 acres out of the project, which would reduce the amount of debt service KID will pay as a landowner by about $1.2 million, officials have said. It would also allow other property owners to join the LID and receive irrigation water.
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