The Pennsylvania Infrastructure Investment Authority on Wednesday approved a $65 million low-interest loan for the Pittsburgh Water and Sewer Authority that will pay for the first phase of a $326 million water main replacement program, officials said.

Over the next five years, PWSA plans to replace aging water mains, starting in 2020 with small diameter pipes, according to spokesman Jake Pawlak. The authority also will replace service lines running to homes and businesses if they’re made of lead.

Pawlak said the 20-year loan at 1% interest will pay for the first two years of work. He said PWSA would apply for other PennVest loans or borrow the money elsewhere to fund the remaining three years.

“We’re going to do the work, so we’ll finance it through however we have to, but we believe our track record with PennVest is very good,” he said. “Because of this award we will not have to borrow from the bond market in years 1 and 2, which we estimate is saving our ratepayers $20 million over 20 years.”

PWSA has been plagued with leaks, particularly in 2019, because of aging pipes that date in some cases to the Civil War. The authority has been working over the past year on replacing the old water mains, according to Paul Leger, who chairs the PWSA board of directors.

“Outside of maybe building a new water plant in the 1960s this is probably PWSA’s biggest capital project,” he said.

PWSA provides water and sewer services to more than 300,000 residents in Pittsburgh and surrounding communities.

PennVest last year provided PWSA with a loan totaling $35.4 million and a grant totaling $13.7 million to fund a lead line replacement program in 2019 and 2020.

PWSA has struggled since 2016 to reduce lead levels in water that have exceeded a federal threshold. It plans to replace all publicly-owned lead water lines by 2026. Last year the authority began adding the lead-inhibiting chemical orthophosphate to the water supply and the most recent testing indicated lead levels have dropped below federal limits.

Gov. Tom Wolf’s office on Wednesday announced $199 million in loans for 18 water and sewer projects, including PWSA’s, in 15 counties across Pennsylvania.

“Tackling Pittsburgh’s aging infrastructure after decades of disinvestment hasn’t been easy, but with the leadership of Gov. Wolf, PennVest and PWSA we’re making sure our water is safe and clean for generations of future residents,” Pittsburgh Mayor Bill Peduto said in a statement.

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