Medford Secures $147 Million Federal Loan to Fix Wastewater Plant After Years of Rogue River Pollution Problems
MEDFORD, Ore. — A $147 million U.S. Environmental Protection Agency (EPA) loan under the Water Infrastructure Finance and Innovation Act (WIFIA) was approved to support major wastewater infrastructure investments in Medford. It will be used to improve the City’s wastewater treatment plant.
Medford Wastewater Upgrades Get Federal Funding Boost
Medford is racing to catch up after years of findings of Rogue River pollution and a Clean Water Act lawsuit. While new upgrades are planned to meet stricter nutrient limits and finally clean up the river, they come at a massive cost.
The city needs to upgrade up to 60% of the existing wastewater plant to reduce nitrogen and phosphorus levels by about 70% and lower the temperature of the treated water before it enters the Rogue River.
Source: EPA WIFIA loans news release dated Dec 18 2025 / City of Medford release on the $147M WIFIA loan
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The WIFIA loan, announced on Thursday, is a critical milestone for the wastewater plant to meet federal environmental standards and is part of broader actions that authorize three WIFIA loans totaling $240 million to communities in Oregon and Washington.
| Community | Loan | Project focus | Impact noted by EPA |
|---|---|---|---|
| Medford, Oregon | $147M | Wastewater infrastructure | 166,000 people / 900+ jobs / Rogue River protection |
| Rockwood Water PUD, northwest Oregon | $28M | Cascade Groundwater Development Project | Drinking water reliability for 66,000 people |
| King County, Washington | $65M | Modernize wastewater system | Replace and build components / add 50 years useful life to part of pipeline |
WIFIA loans offer flexible repayment terms and competitive interest rates. The long-term, low-cost financing allows the city to move forward with critical infrastructure improvements while managing costs for ratepayers.
According to the EPA, the Medford WIFIA loan will benefit approximately 166,000 people, improve wastewater infrastructure reliability, protect water quality in the nationally significant Rogue River, and support the creation of more than 900 local jobs during construction.
U.S. Senator Jeff Merkley created the WIFIA program to invest in water infrastructure projects and job creation after hearing from local Oregon leaders that water infrastructure is one of the top issues facing their communities. He said, “WIFIA continues to be a great model for delivering results through local and federal collaboration.”
Medford Wastewater Plant Plagued By Soaring Interest Rates
The up to $300 million overhaul of the city’s Regional Water Reclamation Facility also faces higher costs due to higher interest rates. Medford’s wastewater plant upgrade is necessary to comply with the federal Clean Water Act, or face fines or other penalties.
Budgeting for the project has proved problematic as Medford officials face interest rates on loans that have gone from a low of 1.8% just a few years ago to as high as 5% in the current market.
Medford will borrow $20 million of the $300 million this year at an interest rate of 4.5% to 5% for 10 years, after which it can be refinanced.
Even the EPA Water Infrastructure Finance and Innovation Act attracts interest of around 4.5%, but the loan can be refinanced if rates go lower. The city aims to keep rates as low as possible and avoid locking the city into long-term loans of 20 or 30 years.
The higher interest could add millions of dollars to the project’s cost over the life of the loans. The city faces a tricky balancing act to avoid ratepayers in the valley being hit with even steeper increases to help pay off the loans.
The current sewer treatment bill for all users of the Regional Water Reclamation Facility is $9.79 per month and is expected to surge to $35-45 per month over the next 10 years.