Bonds from Solano County could help two cities boost their local economies.

More than $1.25 million of Recovery Zone Economic Development bonds could be directed to Dixon. The Dixon City Council on Jan. 26 will consider the option of borrowing the money to fund two major projects in the city.

Another $700,000 could go to Benicia.

The Solano County Board of Supervisors designated the entire county in September as a recovery zone, given the county's double-digit unemployment and high foreclosure rate.

Solano County has a direct allocation of $1.95 million in Recovery Zone Economic Development bonds that may be directed to public entities within the recovery zone.

The designated funds, according to a staff report, are an attempt to spur economic activity by directing favorable bonding opportunities to public and private entities.

Three projects were submitted for consideration, as supervisors voted 5-0 Tuesday and agreed to divide the money among all three.

Of the money, $500,000 has been earmarked for building a water system in the northeast quadrant of the city. Another $750,000 has been allotted for drainage improvements in Dixon's downtown area, which have been a problem for a considerable time.

The city of Benicia also has been allotted $700,000 to replace street structural sections and build drainage systems in the industrial neighborhood next to Interstate 680 and Suisun Bay.

Dixon City Manager Nancy Huston emphasized that the allocation would be to take out low-interest bonds that would be paid back over time.

"This is not a grant," she said. "The council needs to decide if it should accept the bonds and create a debt for the city. This is an opportunity for them (councilmembers) to consider."

Huston added that they wouldn't use redevelopment funds.

"Both of these projects are really important and are both top priorities," she said. "But, if I had to pick, I would try to fix an already-existing problem."

Huston did acknowledge that, right now, the northeast quadrant doesn't have a water system. Having access to water out there would jump-start economic development.

Solano's Public Information Officer Steve Pierce explained that all three projects are worthwhile, but Dixon's projects were given the money because of the "long-term impact on creating jobs."

Benicia, he explained, can apply to the state for the remainder of the money when the state redistributes unused Recovery Zone Economic Development bonds this year.