Loan to save Yuba County money on CalPERS payment
Jul. 18—Yuba Water Agency said Tuesday that Yuba County is expected to save more than $400,000 over the next year due to a $9 million low-interest loan that was approved to help cover the county's pension obligations.
The low-interest loan from Yuba Water Agency to help cover the county's annual payment to the California Public Employees' Retirement System (CalPERS) continues the assistance provided by Yuba Water since 2017, officials said. Each year, the county has repaid the short-term loan in full as it continues to finance its unfunded liability portion of its CalPERS payment.
Officials said an unfunded pension liability is the gap between future benefits that a pension fund expects to pay out and its current assets.
"This agreement is about saving the county money and giving them more flexibility in how they meet their pension obligations," Kurtis Crawford, Yuba Water's director of finance, said in a statement. "The loan has no negative impact on our reserves since we'll still be earning the same interest in repayments as we would from keeping the money in savings. It's a win-win for all."
Officials said the loan from Yuba Water will allow the county to make its "annual payment to CalPERS in one lump sum at a discount rather than financing it through CalPERS at a higher percent interest rate."
Support for Olivehurst, Linda
Also on Tuesday, Yuba Water increased its support for a county project to improve drainage in Olivehurst.
The proposed drainage project is expected to span the lengths of Western Avenue and Fleming Way, plus most portions of Second, Third, Fifth, Eighth, Ninth and Eleventh avenues. Officials said the funds coming from Yuba Water would only go toward elements related to reducing flood risk.
"Olivehurst is a historic Gold Rush community," Dan Peterson, Yuba County director of public works, said in a statement. "There was never a true, engineered drainage system installed. Ditches were put in to keep water off the roadway, but year after year, they have proven insufficient. This project will install not just the first-ever formal drainage system, but curbs, gutters and sidewalks as well, to help us be more resilient in the future."
Officials said the funds provided by Yuba Water will help the county "be more competitive" for a grant made available through the California Transportation Commission's Local Transportation Climate Adaptation Program. The program requires applicants to show they can cover at least 20% of a project's total cost.
Previously, Yuba Water committed $7.5 million for the Olivehurst project.
"In recent months, the county has implemented changes that could increase the potential state grant funding to $38,540,000, bringing the total project cost to $48,477,325," Yuba Water officials said. "To meet the increased cost share, Yuba Water committed an additional $2.4 million to Yuba County, for a total of just over $9.9 million. The revised $9.9 million grant from Yuba Water would only be issued if the county successfully secures funding from the California Transportation Commission. Assuming funding is secured, construction could begin as soon as 2026."
Yuba Water leaders also approved a grant of up to $487,000 to help the Linda County Water District relocate water and sewer assets to accommodate and match improvements already underway as part of Yuba County's Cedar Lane Safe Routes to School Project. This project, officials said, will add new sidewalks, bike lanes and storm drains in West Linda.
"That project is moving forward thanks to a $21 million grant to Yuba County from the California Transportation Commission and supported by a $5.4 million cost share grant from Yuba Water," officials said.
