AMSA Legislative Alert (LA02-03)

To: Members & Affiliates, Legislative Policy Committee, and
Legal Affairs Committee
From: National Office
Date: March 15, 2002
Subject: HOUSE INFRASTRUCTURE BILL INTRODUCED, FEATURES GRANTS
Reference: LA02-03
Attachments: - H.R. 3930 (PDF ~77 KB)
- House T&I section by section summary of H.R. 3930 (PDF ~71 KB)
- AMSA Testimony

The House Water Resources & Environment Subcommittee's Chairman and Ranking Member, Representatives John Duncan (R-TN) and Peter DeFazio (D-OR), have introduced their version of a clean water infrastructure bill, the "Water Quality Financing Act of 2002" (H.R. 3930). According to Subcommittee staff, H.R. 3930 is on the fast track to be marked up in the full Transportation & Infrastructure (T&I) Committee on Wednesday, March 20.

Unlike its Senate counterpart (S. 1961), H.R. 3930 focuses solely on funding for the clean water state revolving fund (CWSRF) program, establishing a new five-year, $20 billion loan program for wastewater treatment and other water quality needs. H.R. 3930 differs from S. 1961 in several respects, but most notably in the inclusion of a mandatory grant set-aside program as well as less onerous requirements for loan recipients. A copy of the House Transportation & Infrastructure (T&I) section-by-section summary of H.R. 3930 is included for your review. The introduction of H.R. 3930 came just hours before the Subcommittee's March 13 hearing on clean water infrastructure legislation, which featured AMSA testimony by Patrick T. Karney, Director of the Metropolitan Sewer District of Greater Cincinnati. A copy of Karney's testimony also has been attached to this Legislative Alert.

AMSA Pressure Leads to Grant Provision, Softening of Loan Requirements
Intense lobbying efforts by AMSA and the Water Infrastructure Network (WIN) helped convince the bill sponsors to include a grant provision in H.R. 3930. The grant provision (see Section 123(i)(4)), similar to one included in legislation (H.R. 3792) introduced in February by Representatives Sue Kelly (R-NY) and Ellen Tauscher (D-CA), would require states to use not less than 25 percent of its annual CWSRF allocation to provide additional subsidization in any year when Congress appropriates at least $1.4 billion for the loan program. As envisioned in H.R. 3930, the grant funds would be available for subsidizing projects on the state's priority list to address state-defined affordability concerns. AMSA strongly supports the inclusion of the grant provision, and recommended in testimony that states be given the authority to define affordability broadly to include a wider array of wastewater projects.

Apart from the grant language, H.R. 3930 also expands the list of eligible projects to include POTW investments in security and funding for nonpoint sources and wet weather watershed projects. States would be required to develop an "integrated priority list", which prioritizes projects based on their ability to achieve water quality improvements. Factors to be considered in developing this priority list include state information on the Section 303(d) impaired waters list and 305(b) water quality assessments.

The bill would include requirements for loan recipients to demonstrate efficiency in operation, management, and financing. These are similar to, but less onerous than, the Senate counterpart bill. H.R. 3930 would require recipients to conduct a physical and operational analysis of that part of the system proposed for repair, replacement, or expansion; to analyze the cost and effectiveness of alternative management and financing approaches, including rate structures, bond issuance, consolidation, and public-private partnerships; and develop and implement plans for funding asset maintenance, repair, and replacement. AMSA suggested in its testimony that the House instead consider alternatives, such as WIN's recommended establishment of a new institute for technology and management excellence, for encouraging POTW efficiency. AMSA also urged the House to establish a formal process to evaluate alternatives for providing a long-term and sustainable funding approach to meet America's wastewater infrastructure needs.

In addition, H.R. 3930 would also clarify that bonds for the purpose of funding water and wastewater facilities are to be exempt from the volume cap on private activity bonds.

AMSA will continue to provide the membership with regular updates on the progress of the House and Senate funding legislation as they proceed to mark up. For further information, please contact Lee Garrigan at 202/833-4655 or lgarrigan@amsa-cleanwater.org.

Attachments:

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