Clean Water Advocacy - Newsroom - AMSA in the News
No. 33
Tuesday, February 19, 2002 Page A-1
ISSN 1521-9402
News
Water Pollution
Senate Bill Would Authorize $35 Billion Over Five Years for Water, Wastewater
Fund
Legislation that would authorize $35 billion over five years for the drinking
water and clean water state revolving loan funds was introduced in the Senate
Feb. 15.
The bill (no number yet) is intended to modernize the SRF and provide states
more flexibility in how the funds are allocated, according to a fact sheet
supplied by the Senate Environment and Public Works Committee. The chief
sponsors are Sens. James Jeffords (I-Vt.), chairman of the committee, Robert
Smith (R-N.H.), Bob Graham (D-Fla.), and Mike Crapo (R-Idaho).
Jeffords said in a statement that the legislation, known as the Water Investment
Act of 2002, is designed to provide more money and flexibility to states to
"ensure that the 'next generation' of water quality issues receives appropriate
focus."
Authorization Levels
The authorization of appropriations under the legislation would be as follows:
in fiscal year 2003, $3.2 billion for the clean water SRF and $1.5 billion for
the drinking water SRF;
in fiscal 2004, $3.2 billion for the clean water SRF and $2 billion for drinking
water SRF;
in fiscal 2005, $3.6 billion for the clean water SRF and $2 billion for the
drinking water SRF;
in fiscal 2006, $4 billion for the clean water SRF and $3.5 billion for the
drinking water SRF; and
in fiscal 2007, $6 billion for each of the two SRFs.
The clean water SRF has not been reauthorized since the Clean Water Act was
reauthorized in 1987. The drinking water SRF was established in the 1996 Safe
Drinking Water Act amendments, which authorized $9.6 billion in capital funding
through fiscal 2003. Nearly $4 billion was actually appropriated for the
drinking water SRF in those five fiscal years, according to information from the
Environmental Protection Agency.
The legislation would make several changes to the clean water SRF incorporating
certain elements already present in the drinking water fund.
Access for Private Systems
For the first time, it would allow privately owned systems access to the funds,
which is already allowed for drinking water.
"Most privately owned wastewater systems are very small such as trailer parks,
are very much in need, and are currently excluded," the bill summary said.
In addition, the bill would retain provisions in both SRFs limiting to 30
percent the amount that can be used by states as direct grants for
infrastructure.
It also would allow for extension of the loan term from 20 years to 30 years and
would allow for principle forgiveness. Communities that are not disadvantaged
would be eligible for "more favorable loan terms" if they show that the
financial benefit would be used to develop a rate structure that would help
low-income ratepayers, the summary said.
The clean water SRF would also mirror the fund for drinking water by calling on
recipients to have "basic technical, managerial, and financial capacity to
operate their system." This includes calling on utilities to have asset
management planning in place or in development. States would have to have a
strategy within three years to help publicly owned treatment works develop this
capacity, the bill summary said. POTWs would have to show "adequate technical,
managerial, financial capacity" including asset management in order to be
eligible for funds.
Consideration of Restructuring Options
Both POTWs and drinking water facilities would have to consider restructuring
options as a condition of receiving SRF money. These include consolidating
ownership or management with another facility, forming public-private
partnerships or other cooperative partnerships, and using non-structural
alternatives or technologies, the bill summary said.
The bill would direct utilities to have a rate structure in place that reflects
the actual cost of service.
"This feature in particular is designed to ensure that once this federal
investment occurs, the local owners of these plants will take the management
actions they need to take to repair and replace their existing infrastructure in
the future without federal assistance," the bill summary said.
A Democratic aide on the House Transportation and Infrastructure Committee told
BNA Feb. 14 that a companion bill would probably be introduced after Congress
returns from its recess the week of Feb. 25. Legislation (H.R. 668) was
introduced in 2001 by Reps. Sue Kelly (R-N.Y.) and Ellen O. Tauscher (D-Calif.)
that would increase funding for the clean water SRF to $3 billion a year through
fiscal 2006.
State, Utility Response Positive
State water pollution officials and waste water treatment officials told BNA
Feb. 15 they were happy about the bill.
"This is a great leap forward," Linda Eichmiller, deputy director of the
Association of State and Interstate Water Pollution Control Administrators,
said. "It signals a strong intent to continue to support the program."
The SRF program replaces the construction grants program of the 1970s and 1980s
that many criticized as an inefficient expenditure of funds. The program
provided about $60 billion to build waste water treatment plants after the
federal Clean Water Act was enacted in 1972.
Officials with the Association of Metropolitan Sewerage Agencies said they
needed more time to study the bill, but added that it shows a recognition of the
need for more federal assistance for infrastructure.
Officials with the National Association of Water Companies, which represent
private water and waste water utilities, said they were pleased with the bill
because it imposed requirements to ensure greater accountability and
efficiencies in publicly run systems.
The bill does not "create a new wasteful, counterproductive grant program,"
Peter Cook, executive director of the association, said in a statement. "Also
the bill requires that systems receiving SRF assistance have in place both a
rate structure that reflects the actual cost of service and an asset management
plan."
Eichmiller said the bill sponsors need to be sure that the language ensures that
the process for obtaining funds remains simple and streamlined, adding that she
was concerned about some of the provisions for public participation.
The bill would provide opportunity for comment when developing project priority
lists and intended use plans.
By Susan Bruninga