EPW COMMITTEE APPROVES
WASHINGTON, D.C. - The
Senate Environment and Public Works (EPW) Committee today approved the Water
Investment Act on a vote of 13 to 6.
The bill improves the financial and environmental sustainability of America's
water programs and provides additional resources to States and localities to
meet water infrastructure needs.
EPW Committee Chairman U.S. Sen. Jim Jeffords, I - Vt., said,
"I am very pleased that the Committee has approved this
vitally important bill. The Water Investment
Act authorizes $20 billion for clean water projects, such as wastewater
treatment plants, and $15 billion for safe drinking water projects, such as
drinking water supply systems and authorizes $1 billion a year for five years
to help small communities meet the arsenic requirement. It also contains a provision to reauthorize
a wet weather grant program at $250 million per year for five years to remedy
sewerage overflows.
“This bill increases loan subsidization for disadvantaged communities,
increases flexibility of water infrastructure loans terms and promotes
innovative, nontraditional methods of resolving water quality problems."
The Bill:
Increases Funding
This legislation
authorizes funding of $20 billion over 5 years nationwide for clean water and
$15 billion over 5 years nationwide for safe drinking water projects.
The legislation also aims to ensure that water facilities that
borrow SRF funds are accountable and financially sustainable when they
construct water infrastructure.
Specifically, this bill ensures that recipients of funds under the CWSRF
have the basic technical, managerial, and financial capacity to operate their
systems. It also ensures that basic
financial management practices, such as asset management planning, are in place
or under development.
The Water Investment Act
requires states to develop a strategy within 3 years of the date of enactment
to assist treatment works in developing technical, managerial, and financial
capacity (hereafter referred to as "capacity").
In order to ensure that
facilities are utilizing the most efficient organizational structure possible,
this bill requires that facilities consider restructuring plans before
receiving funds from the SRF. Theses options include consolidation of
management or ownership with another facility, forming cooperative
partnerships, or using non-structural alternatives or technologies.
Water infrastructure plans that are not coordinated with existing
local development plans may inadvertently provide incentives for excessive or uncontrolled
growth. This legislation recognizes
that concern and includes a provision that specifically requires States to
ensure that water projects are coordinated with local land use plans, regional
transportation improvement and long-range transportation plans, and state,
regional and municipal watershed plans.
In order to ensure the
long-term financial sustainability of water systems, facilities are also
required, as a condition of receipt of funds, to have in place or have a plan
in place to achieve, a rate structure that reflects the actual cost of
service. This feature is designed to
ensure that once this federal investment occurs, the local owners of these
plants will take the management actions necessary to repair and replace their
existing infrastructure in the future with minimal state and federal assistance.
Recognizing that private
wastewater facilities provide a valuable public good and generally operate with
financial accountability, this bill allows privately owned wastewater
facilities to access funds from the CWSRF.
Already permitted under the Safe Drinking Water Act, States will be
required to make private wastewater facilities eligible for funding under the
CWSRF if such utilities are identified in the State's needs survey. Many small systems are privately owned and
the most in need of assistance, yet currently ineligible for assistance.
Increases Flexibility in Loans
Recognizing that not all
communities possess the resources to complete these plans, states are
authorized to provide assistance, including principal forgiveness, to treatment
works to help develop capacity.
In order to provide
flexibility in state loan programs and to address the needs of disadvantaged
communities, this bill permits states to extend the repayment time for
loans. Noting the success of the
disadvantaged communities programs of the Safe Drinking Water Act, this bill
authorizes similar programs under the Clean Water Act. Specifically, it allows the administrators
of state SRF's to extend the repayment of a loan to a disadvantaged community
from 20 to 40 years and allows more favorable loan terms (including principal
forgiveness) for those loans. The bill
also permits states to extend the repayment of a loan to all other communities
from 20 to 30 years.
Recognizing the needs of larger communities with diverse income
groups within their borders, S. 1961 also includes a new opportunity for States
to provide more favorable loan terms to communities that may not be
disadvantaged as a whole, but contain pockets of disadvantaged
individuals. This bill authorizes States
to direct assistance to disadvantaged individuals (based on the State's affordability
criteria) through individual rate structures in a service area or through a
similarly effective program.
The bill further enhances the flexibility offered to states by
making the authority to transfer up to 33% funds between the Safe Drinking
Water Act and Clean Water Act State revolving funds permanent.
In order to increase States' options to address water quality, the
bill also expands project eligibility.
Under current law, projects to construct publicly owned treatment works,
to fund nonpoint source plans and estuary plans are all eligible for
assistance. S. 1961 makes several
important changes to the eligibility and the priority lists.
First, it revises eligibility under the Clean Water Act to include
water conservation, reuse, and recycling, and for security. It also includes provisions that require
that a State 's priority list include not only treatment works, but also all
eligible projects.
Currently, states are only required to list treatment works
projects rather than include all eligible projects. This change ensures that projects included in Nonpoint Source
Management Programs (319 plans) and National Estuary Programs (320 plans) as
well as conservation, reuse and recycling projects, and for security are
considered in intended use plans. S.
1961 also clarifies that planning, design, and associated preconstruction costs
are eligible for funds under the Clean Water Act and Safe Drinking Water Act
State Revolving Funds as stand-alone items.
The vast majority of wastewater and drinking water facilities are
classified as small. Yet, small
communities may not possess the resources to develop capacity. To ensure that both public and private small
systems can effectively develop projects to solve water problems, S. 1961
provides four main types of technical assistance for small communities.
It permits the state to use up to 2% of its capitalization grant
to provide grants to small systems (classified as systems serving 10,000 people
or less) for assistance in financial management, user fee analysis, budgeting,
capital improvement planning, and repair scheduling.
It authorizes $7 million per year over 5 years for technical
assistance to small systems serving less than 3,300 people.
It reauthorizes the Small Public Water Systems Technology
Assistance Centers for an additional $5 million per year over 5 years.
Finally, it reauthorizes the Environmental Finance Centers for
$1.5 million per year over 5 years.
The Water Investment Act also includes several incentives for use
of non-structural technologies which are often more cost-effective and less environmentally
harmful. It specifically states that
these approaches are eligible to receive funding under the Clean Water State
Revolving Fund and requires that recipients of funds consider the use of more
environmentally sensitive technologies.
In addition, it authorizes a demonstration program at $20 million per
year over 5 years to promote innovations in technology and alternative
approaches to water quality management and water supply.
While the Clean Water Act has been generally successful in
addressing point source pollution, nonpoint source pollution continues to be a
problem. The use of nontraditional
technologies in the Water Investment Act will help ensure that nonpoint source
pollution receives appropriate emphasis under the Clean Water Act.
In order to ensure that federal funds are used to remedy problems
of significant noncompliance with the Clean Water Act, S. 1961 requires that
water facilities may not receive funds from the State Revolving Fund unless
those funds will enable the facility to remedy the violations of significant
noncompliance. This provision does not
prohibit facilities under enforceable administrative or judicial orders to
address the problem of significant noncompliance from receiving funds. It also does not prohibit facilities in
significant noncompliance from receiving funds for planning, design, or
security purposes.
It also ensures that public participation in the execution of the
state revolving loan funds will be increased through public outreach. This will
ensure that individuals interested in the selection and prioritization of water
quality projects are given ample opportunity for participation in the process.
In order to provide States with long-term guidance in planning for
water needs in the future, the bill also requires the United States Geological
Survey to conduct a nationwide assessment that identifies areas of the U.S. at
risk for water shortage or surplus in the next 50 years and areas where these
risks are regional. This title calls for the Secretary of Interior, through
USGS, to conduct three specific tasks: assess the state of the water resources
of the U.S., develop and execute federal water research priorities, and share
and distribute information. The
research priority list is intended to provide some structure to ongoing federal
water resource research. The Secretary
is required to provide the results of the assessment to Congress and report
every 2 years on the implementation of this title.