Copyright 2001 eMediaMillWorks, Inc.
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Federal Document Clearing House
Congressional Testimony
March 27, 2001, Tuesday
SECTION: CAPITOL HILL HEARING TESTIMONY
LENGTH: 5974 words
COMMITTEE:
SENATE ENVIRONMENT AND PUBLIC WORKS
SUBCOMMITTEE: DRINKING WATER, FISHERIES AND WILDLIFE
HEADLINE: TESTIMONY WATER INFRASTRUCTURE
TESTIMONY-BY: JON SANDOVAL , CHIEF OF STAFF
AFFILIATION: IDAHO DEPARTMENT OF ENVIRONMENTAL QUALITY
BODY: March 27, 2001 Statement of J.R. Sandoval,
Chief of Staff State of Idaho Idaho Department of Environmental Quality BEFORE
THE UNITED STATES SENATE Subcommittee on Fisheries, Wildlife, and Water
Committee on Public Works and the Environment State Perspective: Needs of Small
Communities for Water and Wastewater Infrastructure Mr. Chairman and Members of
the Committee: My name is Jon Sandoval. I am Chief of Staff at the Idaho
Department of Environmental Quality in Boise, Idaho. I bring greetings to you,
Mr. Chairman, from Governor Kempthorne, and Director, Steve Allred. I am
testifying to share with you the perspectives of Idaho and other largely rural
Western States who, along with their small communities, face unique and often
overlooked challenges in meeting water and wastewater needs. On behalf of the
State of Idaho, I very much appreciate your invitation to share my comments with
you today. Water and Wastewater Infrastructure Needs of Small Communities
Enhancements over the years to the Safe Drinking Water Act (SDWA) and the Clean
Water Act (CWA) have significantly enabled states to address major improvements
in how infrastructure needs of small rural communities are served. States have
been very successful in their efforts to work with small communities to better
define current and projected infrastructure needs in rural areas. It is small
communities who are most impacted by lack of capacity and financial stress in
assuring citizens are provided safe drinking water and wastewater treatment at
an affordable cost. Small communities face a unique situation as they must weigh
the costs of necessary capital investments to meet national environmental and
public health goals of the CWA and the SDWA with other pressing public needs.
These communities struggle with the need to replace outdated and failing
infrastructure in order to achieve environmental compliance. Small communities
in Idaho, and in all Western states face a number of common issues: How much is
available to spend, and are revenues adequate? How do they document the need for
financial assistance? Can debt service be properly managed? How do they obtain
the necessary engineering, financial and technical expertise at an affordable
cost? How much does it cost to operate and maintain their facilities? How do
they find and obtain affordable public financing? How much of the cost will
consumers have to bear? Small communities in Idaho, and throughout the Western
United States, find themselves facing what they perceive are unrealistic
regulatory burdens. These same communities have serious funding limitations and
few opportunities to address drinking water quality and wastewater treatment
infrastructure needs in rural areas. In Idaho, the mechanics of documenting need
is a major challenge on our small communities. While limited technical
assistance is available from state and federal sources, these communities face a
number of obstacles when it comes to defining need as trends have continued to
suggest: - Federal requirements are increasingly becoming more stringent to
improve water quality and drinking water safety. - Increasing costs of attaining
these requirements will continue to escalate as there is a more directed focus
to: - use technologies that are more complex and expensive - recognize energy
use costs have tripled in the Pacific Northwest - acknowledge the rising costs
of capital improvements to replace aging and/or failing water distribution
systems and wastewater collection systems is, for many of these communities, an
extreme hardship. Small communities across the western portion of the United
States face substantive environmental challenges and responsibilities. Local
leaders find themselves, as one Mayor of a small community of 1500 in Eastern
Idaho stated "being documented to death". Documenting needs of small communities
to a host of jurisdictional and public financing agencies results in a great
deal of dialogue and discussion but, unfortunately, yields little or no
on-the-ground results. As the Mayor from that small town in Eastern Idaho
concludes: "It's all talk. I am asked to make de- facto decisions about complex
financing and technical issues about water treatment processes without the
benefit of knowing exactly what it means to my community". Small communities are
at a distinct disadvantage with federal requirements for environmental
compliance - as these entities lack necessary financial resources, capacity,
structure, access to technology, and the right tools in their communities to
make informed and rational decisions. The debate in small communities
traditionally focuses on the merits of upgrading a 20-year old wastewater
treatment plant, buying a fire truck, or upgrading a 50-year old elementary
school. What should the community determine is the best value for their tax
dollar: Environmental compliance? Schools? Public Safety? This is the reality of
the issues and the decisions small communities have to make. It is increasingly
difficult for small towns to manage and implement environmental requirements,
even though EPA and states have broadened and expanded their capacity to provide
direct technical assistance. States, as well as the federal government, often
impose unrealistic expectations on these communities to document need at a level
of detail without acknowledging the reality of the issues and decisions these
small communities in rural areas must make. The realities we need to address
when it comes to understanding and responding to the infrastructure needs of
small communities is that small towns and rural areas dominate our nation.
Approximately 90 million people live within jurisdictions serving less than
10,000 residents. Approximately 75 million people live in small, rural
communities of less than 2,500. One-third of all local governments do not have
any employees. 97 percent of the country's landmass is classified as "rural". In
Idaho, there are 36 rural counties, with 88.3 percent of Idaho's land area, and
36.2 percent of the state's population. Idaho averages 14.8 persons per square
mile, compared to 74.6 persons for the United States. Idaho is the seventh most
rural state in the country with rural counties averaging 6.1 persons per square
mile. Counties with fewer than six persons per square mile are often referred to
as "frontier areas" with six counties having less than two persons per square
mile. In Idaho, we define a "small community" as a community of 1,000 people or
less. I would encourage the Environmental Protection Agency to consider using
this definition because it has been our experience using our definition of small
communities ... these are the communities where the greatest hardship exists.
These are the communities where the need for infrastructure improvement and
enhancement are Idaho's biggest challenge and where we do not see enough federal
response to address the financial stress of rural communities. People who live
in small rural communities in Idaho are proud of their communities and their
rural heritage. They want to comply with reasonable health and environmental
standards. However, local officials are concerned about requirements where no
consideration for the unique circumstances and challenges of small communities
has been factored. These same local leaders take issue with unnecessary and
cumbersome regulations restricting a small community's ability to respond
intelligently to local priorities and needs. Small communities want to provide
the necessary infrastructure for safe drinking water supplies and wastewater
treatment facilities but need to have the federal government recognize the
limited financial capacity these small communities are experiencing. Changing
demographics, high unemployment, declining tax base and increased costs of doing
business are unique realities of small communities in rural areas. To not
acknowledge these realities is a grave mistake. If there is no regulatory relief
and no flexibility to find innovative mechanisms to finance small community
infrastructure needs, we will witness "regulatory and financial flight" by small
communities. As it stands, small communities in Idaho and across all states in
the West cannot viably comply with overly prescriptive environmental mandates or
find innovative ways to obtain and secure financing for infrastructure needs. We
have a responsibility as public policy makers to assist small communities to
build capacity to comply with reasonable environmental regulations and to solve
the financing issues in a collective effort to ensure public health and
environmental protection. Fiscal concerns at all levels of government, and
particularly for smaller, rural communities, have dramatically elevated the
issues of federal environmental protection program costs and flexibility.
Environmental laws depend extensively on State and local implementation, which
raise questions of where the financial burden should lie. Public health values
are also raised, as it is our responsibility to extend these values uniformly to
all citizens, which can also lead to unequal cost burdens because of variations
in local conditions, services involved, populations affected and economies of
scale. Environmental compliance has become more costly, especially for small
communities struggling with other competing public and community needs.
Environmental statutes (i.e., CWA and SDWA) are not consistent in addressing the
sharing of cost burden of achieving local public health and environmental
benefits. There is a tension between desired environmental goals at the national
level and the need to finance infrastructure enhancements at the local level.
Issues in this debate include greater use of market incentives, cost
effectiveness and flexibility in regulation, and more critical attention to who
should pay for environmental protection - the unfunded mandates issue. A general
perception in small communities in the West is that the costs to States and
localities imposed by Federal mandates are growing disproportionately faster
than Federal assistance. We calculate in Idaho, if we are to meet the
infrastructure needs of all small rural communities, we will need to spend
considerable state resources and need to find more innovative ways to fund
infrastructure needs. We suggest
grant funding or, at minimum,
very low interest loans in order to allow federally mandated projects to meet
new requirements. If we realistically want to address the small community water
and wastewater infrastructure need, we need to see more federal dollars directed
to local government in the form of
grants for costs related to
National Environmental Policy Act (NEPA) requirements. While the SRF programs in
Drinking Water and Wastewater work well for larger municipalities, small
communities are distinctly at a disadvantage when it comes to capacity,
documenting need, securing the necessary financing package to service to debt
obligations. Compounded by the cost factor is the additional perception that
there is no flexibility. State and local interests are at stake. The perceptions
of small communities is not to "roll back" environmental and other laws designed
to protect the public health and welfare --- but, on the contrary, to have firm
support that Congress should address the funding issues directly without
altering requirements to comply with pollution standards. Local government is
most affected by the costs of complying with federally mandated pollution
standards, particularly for meeting drinking water and sewage treatment
requirements. The capacity to borrow money at commercial financing institutions
is not a viable option. It is our experience that "small communities" without
staff, technical and financial expertise, access to technology, and no money -
need a much better solution to address their infrastructure needs. Small
communities will have to spend considerably more money per year than they now
spend if they are to meet the total investment, operation, and maintenance needs
to replace aging and failing distribution and collection systems. Small
communities are most frequently at a disadvantage when it comes to
"documentation". Small communities lack capacity, know- how, and sophistication
to produce Capital Improvement Plans, Environmental Impact Statements (EIS), or
Engineering Reports describing capital improvements necessary to provide safe
water or demonstrate adequate capacity to treat waste. In Idaho, as in most
rural states, where capital improvement plans and engineering reports are
unavailable or cannot be produced by small communities, the state response has
been effective. State Water Quality engineering staff take the lead to compile
required documentation on-site or through contractual assistance to the
community via a state initiated "planning
grant" to obtain the
necessary data to be submitted to EPA. We sometimes experience great frustration
in obtaining approval of priority projects with EPA as approximately 15% of our
proposed projects are "disapproved" for lack of adequate documentation. While
the documentation is provided, there is a general perception in Idaho that there
is heavy reliance at EPA to support "modeling data and applications" over
documented needs submitted by individual states. Based on the documentation we
collect from small communities, or when small communities have generated and
submitted detailed explanations of infrastructure needs on their own, we make
determinations for funding based on: - Public Health Emergency or Public Health
Hazard - Highest Priority to protect Water Quality and the environment -
Watershed Restoration - Watershed Protection from Impacts - Preventing Impacts
to Uses - Highest priority to protect water quality and the environment -
Ability to pay and secure public financing - Water Quality Violation - General
Conditions of Existing Facilities - Under Consent or Administrative Order -
Incentives: - Source water assessment - Master or facility plan complete -
Replacement fund established - Regionalization/consolidation plan implemented -
Rate structure - Monitoring requirements met - Affordability (O.M.R and debt
service greater than 2% of median household income (MHI) Small communities incur
pollution control costs because they own or operate public water supplies for
drinking water, sewage treatment and/or waste disposal facilities. The 1987
revision to the Clean Water Act began a phaseout of the long-standing federally
funded sewage treatment
grant program with a revolving loan
program that local governments could tap, but would have to repay. When it comes
to the needs of small communities, there have to be better solutions and a much
better federal response to provide direct funding assistance to communities of
1,000 or less. Our experience in Idaho, as it is with most states in the West,
is that we have to do a much better job of serving the needs for water and
wastewater infrastructure needs of small rural communities. It means, States and
EPA must be more flexible, innovative and more responsive to the needs of
communities who are experiencing severe financial hardship. We must work with
EPA to find better ways to increase state capacity to provide more technical
assistance to these impacted communities. A mandatory Wastewater Operator
Certification Program is a good idea in respect to evolving and expanding
federal testing and monitoring requirements --- but we need to ensure funding is
available to train operators before requirements are implemented if we want to
ensure we are protecting water treatment in small rural communities. In respect
to the WIN Report, Idaho does agree there will be a substantial funding gap for
water and wastewater systems between current investments in infrastructure and
the investments that will be needed annually over the next 20 years to replace
aging and failing pipes and to meet increasing federal compliance requirements.
Idaho has voted to support the resolution of the Environmental Council of the
States (ECOS) passed unanimously at its 2001 Spring Meeting on the Water Gap
Analysis. Providing additional resources to fix aging infrastructure is
essential, but no matter how it is ultimately done, states will be expected to
play a significant management role. In addition to the gaps in funding, states
also continue to face extraordinary needs to manage nonpoint source issues,
TMDLs, as well as new proposed rules to manage animal feeding operations ...
which in turn, have an impact on the infrastructure needs of small communities.
Increased assistance for state capacity to meet these needs must also be
factored into the debate as we attempt to address the rest of our water quality
challenges at the local, state and federal level. It is the financial and
prescriptive "federal strings" attached to the revolving loan programs for
drinking water and wastewater treatment that raise the hackles and the tempers
of local government officials trying to find reasonable financing mechanisms to
comply with pollution abatement requirements. The federal government must come
to fully recognize that local governments and ratepayers fund 90 percent of
clean and safe
water infrastructure costs while struggling to
resolve competing demands to educate children, maintain roads, fight crime, and
provide other basic access to primary health care services. Small communities
should not have "to choose between providing safe and clean water and funding
other necessary community and public needs". Better solutions are needed because
what we have is not working for small communities. Overall infrastructure
spending, according to the Congressional Budget Office, was about $200 billion
per year by the mid 1990s. The Federal capital expenditure, however, has
remained relatively flat at about $50 billion per year from 1977 to 1998, or
about two percent of the total Federal budget". Local government, and in
particular, small communities, has born the brunt of infrastructure improvements
and spending since the late 1950s. The economic history of rural communities is
closely linked with natural resources: soils, and water for crop and livestock
production; hardrock minerals, coal, oil, and natural gas extraction; and
forested lands for timber. Be it rural Idaho, or the Mora Valley of Northern New
Mexico; the agricultural production of the San Luis Valley in Southern Colorado;
the forested areas of Western Montana; or the Gas Hills in North Central Wyoming
---- small communities in these areas and throughout the West have continued to
depend on water as the life blood of their communities. However, new
technologies coupled with globalization of labor and the economy are changing
where and how Americans work. New applications in resource extraction industries
as well as growth in "service" occupations are helping to diversify many rural
economies. Such diversification offers opportunities for small communities.
Until the 1960's, environmental protection, whether to preserve environmental
amenities such as swimmable and fishable water, to protect economic values or
public health --- was almost solely the responsibility of local and State
government. Idaho believes it can manage environmental programs at reduced cost
and with more efficient service delivery mechanisms if given requisite
flexibility and the ability to decide and determine state environmental
protection priorities. In order to maximize our resources, the correct federal
response will be to address the economic issues of communities of 1,000 people
or less. The cost of environmental compliance and environmental protection vary
widely from one area to another. States are concerned about the need and the
cost to replace inadequate or aged drinking water and wastewater treatment
facilities. States are concerned about the impacts of these costs in rural areas
on small communities in particular. Without a significantly enhanced federal
role in providing direct financial assistance to drinking water and wastewater
infrastructure, critical investments in small communities will not occur. Idaho,
as well as other Western states, would consider entering into a serious
discussion with EPA to closely assess and evaluate the water and wastewater
treatment infrastructure needs of communities of 1,000 people or less. The area
of focus needs to be directed at increasing state capacity to address impacted
community issues, financing, documentation of needs, transmission costs,
regulatory compliance, and establishing standards appropriate to small rural
communities. We would ask Congress to seriously consider other funding options
to get financial resources to these communities in order to respond
appropriately to the infrastructure needs. It has been the Idaho experience that
small communities do not have the financial resources available to shoulder the
immediate and long-term infrastructure improvement or replacement costs of aged
facilities. There is a definitive need for targeted financial assistance to pay
for expensive water treatment facilities and adequate public water supplies in
small rural communities. The federal government must come to fully recognize
that local governments and ratepayers fund 90 percent of clean and safe
water infrastructure costs while struggling to resolve
competing demands to educate children, maintain roads, fight crime, and provide
other basic access to primary health care services. Small communities should not
have "to choose between providing safe and clean water and funding other
necessary community and public needs". Better solutions are needed because what
we have is not working for small communities and the infrastructure needs are
not being adequately addressed in spite of state government efforts to find more
creative ways to assist these communities. Local capacity for developing
long-term funding strategy is very limited in rural communities due in large to
the complexity of the policies. Economies of scale do not favor small
communities. Greater assistance is needed to help communities address
infrastructure issues and the need for capital asset management. The complex
matrix of federal, state and private funding sources provides flexibility in
water quality efforts; however, this flexibility only exists if knowledge and
capacity are present. Greater funding is needed to help build financial
knowledge and capacity of rural communities. We need to work together to design
and develop an integrated vision of the economic, environmental and social
characteristics of small communities. This requires strong leadership at all
levels. Thank you, Mr. Chairman and Members of the Committee, for this
opportunity to comment on this important issue to states and to the small
communities we serve in rural areas.
LOAD-DATE: April
17, 2001, Tuesday