After years of watching stormwater pool in streets and creep into yards, Daly City is getting a major assist from Washington in the form of cheap federal financing.
The Environmental Protection Agency is providing a $34 million low‑interest loan to the Daly City Joint Powers Financing Authority to upgrade the Vista Grande stormwater system. The project is designed to knock down neighborhood flooding, reroute more runoff into South Lake Merced, stabilize lake levels and boost regional water quality, all while cutting long‑term borrowing costs for the district and supporting local jobs.
According to an EPA release, the loan is being issued through the agency’s Water Infrastructure Finance and Innovation Act (WIFIA) program for the Vista Grande Drainage Basin Improvement Project. The financing is structured so the authority can draw funds as construction progresses, which federal officials say will save roughly $2.6 million over the life of the loan while supporting an estimated 500 construction and operations jobs.
What the Work Will Involve
On the ground, the plan calls for replacing an undersized canal, enlarging the existing Vista Grande tunnel, improving the overflow system that connects to Lake Merced and building a new outlet structure to the Pacific Ocean, according to project documents.
The San Francisco Public Utilities Commission, which is coordinating shoreline mitigation with Daly City, explains that some stormwater will be routed through screening devices, a treatment wetland and an impoundment before being diverted to South Lake Merced to help restore the basin’s natural hydrology. SFPUC notes that pre‑construction environmental mitigation around the lake shoreline is already underway.
Funding and Local Reaction
EPA Pacific Southwest Region Water Division Director Tomás Torres called the Vista Grande work critical water infrastructure upgrades to better protect San Mateo County communities from flooding, stabilize Lake Merced’s water levels and improve regional water quality, according to the federal agency.
Daly City City Manager Thomas J. Piccolotti described the WIFIA loan as a critical investment in Daly City and the region’s infrastructure and environmental stewardship, saying it will improve system reliability and safeguard water quality for generations. EPA published both comments in its announcement.
Timeline, Mitigation and Next Steps
Daly City says the Vista Grande project has long been through environmental review, with a joint EIR/EIS on file as officials prepare compensatory mitigation around Lake Merced to offset construction impacts. The city’s water department outlines accompanying habitat‑restoration work, including invasive plant removal, new native plantings and five‑year maintenance commitments around the lake.
Daly City, in coordination with the San Francisco Public Utilities Commission, lists a construction window running roughly from fall 2025 into 2027, and officials say securing the WIFIA financing clears a major hurdle for moving the work into that phase.
For Daly City residents who have watched gutters overflow during big storms, the project is intended to provide a very practical payoff: keeping stormwater in the system instead of in the street, while shoring up South Lake Merced as a regional water asset. City officials say construction will be staged to limit neighborhood disruptions, with more detailed information expected through city channels as contracts are awarded and schedules are finalized.
