Public Works Board amends emergency program policy to allow 0% interest on emergency loans

The Public Works Board voted Sept. 4 to amend its traditional emergency program policy to allow emergency projects to receive 0% interest loans, a change staff said is authorized under RCW 43.155.065.

Max Wedding, programs director, said the "meat of the policy recommendation is the 0% interest rate," and explained that staff and the Traditional Committee considered multiple options — offering 0% interest for all emergency projects or limiting it to distressed jurisdictions. Gary Roe asked that the policy be forward-facing and clarified whether it would apply to fiscal-year-27 awards; Roe said he preferred the change apply beginning in FY27. The committee recommended applying 0% interest to all emergency projects, and the board approved a motion to adopt the amendment effective for FY27 projects onward.

Not all members supported the change. Member Laura Petso said while she supported the concept of 0% interest, she would vote against adopting the policy because of longstanding concerns with hardship criteria and awarding 100% grants: “I fully support the committee recommendation for a 0% interest rate. But in the end, I'm gonna vote against this policy due to long standing concerns about our hardship criteria and about awarding a 100% grants for public works projects,” she said.

Staff told the board the authority exists under state statute for the board to make low-interest or interest-free loans or grants to local governments for emergency public works projects; the committee deliberated operational options and recommended a broad 0% interest approach, which the board approved by voice vote. Staff will incorporate the amendment into policy language and apply it to eligible FY27 emergency projects.

Why it matters: The change lowers borrowing costs for jurisdictions responding to emergency infrastructure failures, but some board members raised questions about eligibility thresholds and long-term fund impacts.