County officials and residents at the northwest end of Lake Berryessa have millions of new reasons to hope for a revamp to the aging water treatment plant near Pope Valley.

The Lake Berryessa Resort Improvement District, which serves water and sewer to Berryessa Estates’ 500 residents, will receive a $2.25 million federal stimulus grant to replace the drinking water treatment facility, Rep. Mike Thompson, D-St. Helena, announced Thursday.

“Rural areas of our district need as much, if not more, help from the stimulus act,” Thompson said in a statement. “When I voted for recovery funding for our country, it was for projects like this that will invest in and improve our community, while creating jobs. This is a great day for Lake Berryessa residents.”

Diane Dillon, the Napa County supervisor who represents Lake Berryessa, said she is grateful for Thompson’s support in getting the funds. She now hopes that assessments on property owners — intended to cover upgrades to the water treatment and sewage plants — will be reduced.

Napa County engineers were thrilled at the news.

“Fantastic,” said Don Ridenhour, Napa County’s public works director.

Property owners at Berryessa Estates had agreed to pay an assessment to cover the costs of several infrastructure improvements, including the replacement of the water treatment plant. An engineering consultant has estimated the project at $1.1 million. But three rounds of bids since last fall failed to line up a contractor with a proposal at that price. The lowest bid, in April, came at $1.2 million, said Nate Galambos, Napa County principal engineer.

Galambos said the stimulus money should cover all construction, inspection and administration costs of the new water treatment plant.

 The plant, which could be under construction in November, will serve the subdivision when it is built out with about 340 homes. Construction could take a year, Galambos said.

The district needs to build and repair its water and wastewater treatment systems in order to comply with state water regulations.

The district has been fined $400,000 for a series of water treatment and release violations over the years.

Under a deal with the Regional Water Quality Control Board, the district will be able to pay the fines in installments if it repairs its water and sewer treatment systems.

The district has completed a series of improvements, including creating six acres of sprayfields for the district’s sewer system and repairing or replacing 8,500 feet of sewer pipes.

Projects that still have to be completed include the repair or construction of three water tanks, Galambos said.