Glendale Water & Power is set to spend $7.8 million on capital improvements and research projects this year — a major boost for the system that officials said could only be achieved after issuing $35 million in bonds last month.

The projects, which include upgrading water mains and wells, will not only improve water distribution and quality, but also bring jobs to construction workers, officials said.

“It is a one-city WPA, as we like to boast,” City Manager Scott Ochoa said at a City Hall meeting Tuesday night, referring to the “Works Progress Administration” that was established during the Great Depression.

City officials had originally planned a “zeroed-out” budget this year due to thin margins on the water side of the utility, which will not likely dig its way out of a nearly $11-million hole until 2016 as customer rates continue to increase over the next three years.

With officials keenly aware that bond rating agencies were keeping a close eye on the utility, the City Council narrowly approved the bond issuance in November.

The heavy borrowing from electricity revenues to pay for large infrastructure projects led to the need for years of water rate increases and a complete rate overhaul that now charges people depending on the level of their water use and the size of their meter.

One of the only major expenditures that had been planned for this year was $1.5 million in research on the water contaminant chromium 6, which would be reimbursed by federal and state grants.

But with the bond money now in hand, utility officials have an aggressive plan to improve “nuts and bolts” infrastructure. The rest of the money will be used on projects over the next two fiscal years.

Projects include Adams Hill, Kenneth and Ben Lomond water main replacements, as well as water and pipe cleaning, according to a city report.

“We are taking the initiative to make sure we get that money out on the street,” Ochoa said.

The City Council also agreed to refinance $31.6 million in electricity bonds that were issued in 2003 to improve the Grayson Power Plant.

By issuing $23.6 million in new bonds for refinancing, the utility interest rate is expected to drop from 4.94% to 3.5%, according to the city, saving Glendale Water & Power $2.8 million over the remaining 19-year life span of the bond issuance.

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